CSLM Digital Asset Acquisition Corp III, Ltd 8-K, filed Oct 7, 2026
CSLM Digital Asset Acquisition Corp III, Ltd (KOYN)
About this 8-K
CSLM Digital Asset Acquisition Corp III, Ltd filed this 8-K on October 7, 2026, reporting on events of October 6, 2026.
Items reported
- Item 1.01: Entered into a material agreement
- Item 7.01: Regulation FD disclosure
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| N/A | ||||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including
area code: (
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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.
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| The Stock Market LLC | ||||
| The Stock Market LLC | ||||
| The Stock Market LLC |
Item 1.01 Entry into a Material Definitive Agreement.
Business Combination Agreement
On October 6, 2026, CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company (“KOYN” or “Acquiror”) entered into a business combination agreement (the “Business Combination Agreement”) with First Digital Group Ltd., a Gibraltar private company (the “Company” or “First Digital”), CSLM III Holdings Ltd, a Cayman Islands exempted company and a wholly-owned subsidiary of KOYN (“PubCo”). Acquiror will establish a Cayman Islands exempted company limited by shares (“Merger Sub”), as a direct wholly-owned subsidiary of KOYN, for the purpose of effectuating the transactions contemplated by the Business Combination Agreement. Capitalized terms used in this Current Report on Form 8-K (this “Report”) but not otherwise defined herein have the meanings given to them in the Business Combination Agreement.
Pursuant to the Business Combination Agreement, among other things, (i) the Company will re-domicile from Gibraltar to the Cayman Islands and transfer by way of continuation as an exempted company limited by shares in the Cayman Islands (the “Re-domiciliation and Continuation”); (ii) following the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo; and (iii) following the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”) with the Company being the surviving entity and becoming a wholly-owned subsidiary of PubCo.
Reincorporation Merger
In connection with the Reincorporation Merger, at the Reincorporation Effective Time:
| ● | each issued and outstanding Acquiror Unit immediately prior to the Reincorporation Merger Effective Time will be separated automatically into its constituent securities (i.e., one Acquiror Class A Ordinary Share and one-half of an Acquiror Warrant); | |
| ● | each issued and outstanding Acquiror Class B Ordinary Share immediately prior to the Reincorporation Merger Effective Time will be automatically cancelled and cease to exist in exchange for one newly issued PubCo Class A Ordinary Share; | |
| ● | each issued and outstanding Acquiror Class A Ordinary Share immediately prior to the Reincorporation Merger Effective Time (including the Acquiror Class A Ordinary Share from the separation of the Acquiror Units) will be automatically cancelled and cease to exist in exchange for one newly issued PubCo Class A Ordinary Share; and | |
| ● | each issued and outstanding Acquiror Warrant immediately prior to the Reincorporation Merger Effective Time (including the Acquiror Warrants from the separation of the Acquiror Units) will cease to be a warrant with respect to Acquiror Class A Ordinary Shares and be converted automatically into a PubCo Warrant to purchase one PubCo Class A Ordinary Share at $11.50 per share. |
Acquisition Merger and Merger Consideration
At least one Business Day following the Reincorporation Merger and the Re-domiciliation and Continuation (subject to the completion of the Reincorporation Merger and the Re-domiciliation and Continuation having occurred) but in any event within three Business Days after the Reincorporation Merger Effective Time, subject to the terms and conditions set forth in the Business Combination Agreement, the Acquisition Merger shall take place.
1
In connection with the Acquisition Merger, at the Acquisition Merger Effective Time:
| ● | each Company Exchanging Share that is held by Mr. Vincent Chok shall automatically be cancelled and cease to exist in exchange for such number of newly issued PubCo Class B Ordinary Shares that is equal to the Exchange Ratio, as applicable, as determined in accordance with the Business Combination Agreement, based on a total Company Valuation of $250 million, subject to adjustment provided in the Business Combination Agreement. |
| ● | each Company Exchanging Share that is held by any person other than Mr. Vincent Chok shall automatically be cancelled and cease to exist in exchange for such number of newly issued PubCo Class A Ordinary Shares that is equal to the Exchange Ratio, as applicable, as determined in accordance with the Business Combination Agreement, based on a total Company Valuation of $250 million, subject to adjustment provided in the Business Combination Agreement. |
| ● | each FDG Token (a token that confers the holder thereof an option exercisable into a Company Preference Share) that is outstanding and vested and not converted into Company Preference Shares prior to the Acquisition Merger Effective Time shall automatically be cancelled and cease to exist in exchange for the right to receive from Nemi Limited (“Nemi”) the number of PubCo Class A Ordinary Shares that any one Company Preference Share was exchanged for at the Acquisition Merger Effective Time, to be transferred by Nemi to the holder of such FDG Token. |
| ● | each FDG Token that is not vested prior to the Acquisition Merger Effective Time shall automatically be cancelled and cease to exist without any conversion thereof or payment or other consideration therefor, provided that the board of directors of PubCo, in its sole discretion, may decide to re-grant options or other equity awards under the PubCo Equity Incentive Plan to the holders of such unvested FDG Tokens after the Acquisition Merger Effective Time. |
| ● | the warrants issued by the Company on or around the date of the Business Combination Agreement (the “Binance Company Warrant”) to Alphanest Holdings Ltd (the “Binance Warrantholder”), a company organized and existing under the laws of the United Arab Emirates, shall automatically be terminated and expire in exchange for the warrants issued by PubCo to the Binance Warrantholder (the “Binance PubCo Warrant”) that entitles the Binance Warrantholder to subscribe for a number of PubCo Class A Ordinary Shares equal to the number of the unsubscribed FDG Warrant Shares (as defined in the Binance PubCo Warrant) multiplied by the Exchange Ratio. A form of Binance PubCo Warrant is filed with this Report as Exhibit 10.8 and is incorporated herein by reference. The foregoing description of the form of Binance PubCo Warrant does not purport to be complete and is qualified in its entirety by the terms and conditions of the Binance PubCo Warrant. |
| ● | the warrants issued by the Company on or around the date of the Business Combination Agreement (the “Noble Elite Company Warrant”) to Noble Elite Ltd (the “Noble Elite”), a company organized and existing under the laws of the Cayman Islands, shall automatically be terminated and expire in exchange for the warrants issued by PubCo to Noble Elite (the “Noble Elite PubCo Warrant”) that entitles Noble Elite to subscribe for a number of PubCo Class A Ordinary Shares equal to the number of the unsubscribed FDG Warrant Shares (as defined in the Noble Elite PubCo Warrant) multiplied by the Exchange Ratio. A form of Noble Elite PubCo Warrant is filed with this Report as Exhibit 10.9 and is incorporated herein by reference. The foregoing description of the form of Noble Elite PubCo Warrant does not purport to be complete and is qualified in its entirety by the terms and conditions of the Noble Elite PubCo Warrant. |
| ● | the PubCo shall issue 5,000,000 PubCo Class B Ordinary Shares to Mr. Vincent Chok. |
2
Representation and Warranties
Under the Business Combination Agreement, the Company and KOYN made representations and warranties to each other, including without limitation as to the organization, subsidiaries, due authorization, no conflict, governmental authorities and consents, capitalization, financial statements and internal controls, undisclosed liabilities, litigation and proceedings, legal compliance, contracts and no defaults, taxes, absence of changes, proxy/registration statement, investment company, and brokers’ fees; in the case of the Company, as to its benefit plans, labor relations and employees, insurance, licenses, equipment and other tangible property, real property, intellectual property, privacy and cybersecurity, stablecoins, environmental matters, anti-corruption compliance, anti-money laundering, sanctions and international trade compliance, and in the case of KOYN, as to its SEC filings, trust account, business activities, and Nasdaq listing.
Covenants and Agreements of the Parties
The Business Combination Agreement also contains joint covenants of the parties regarding their conduct during the period between the signing of the Business Combination Agreement and the earlier of the closing of the Business Combination or the termination of the Business Combination Agreement, including covenants regarding, among other things, regulatory approvals and filings, preparation of proxy statement/registration statement, shareholder approvals, support of transaction, tax matters, cooperation and consultation, indemnification and insurance, public announcements, adoption of PubCo Equity Incentive Plan, post-merger closing directors and officers of PubCo.
The Business Combination Agreement also includes certain covenants (i) provided by the Company, in connection with, among other things, the conduct of business, inspection, alternative proposals, exchange listing, notice of development, no trading, shareholder litigation, and shareholder proxies, and (ii) provided by KOYN, in connection with, among other things, the trust account proceeds and related available equity, the conduct of business, inspection, Nasdaq listing, no solicitation, public filings, notice of developments and shareholder litigation.
Prior to the Acquiror Shareholders’ Meeting, the Acquiror Board shall also (i) approve and adopt an equity incentive plan in form and substance reasonably satisfactory to the Company and the Acquiror (the “PubCo Equity Incentive Plan”), under which the maximum number of PubCo Ordinary Shares to be reserved for issuance shall be equal to ten percent (10%) of the Post-Closing Fully Diluted Share Count (excluding the number of shares to be reserved under the PubCo Equity Incentive Plan); and (ii) shall approve an agreement by and between PubCo and Mr. Vincent Chok in form and substance reasonably satisfactory to the Company and the Acquiror, providing for the equity grant and vesting conditions, including the key performance indicators as set forth in Schedule 1 (Earn-out Summary) to the Business Combination Agreement (the “Founder Earn-Out Agreement”). The Acquiror Board shall recommend to the shareholders of the Acquiror to approve the PubCo Equity Incentive Plan and Founder Earn-Out Agreement at the Acquiror Shareholders’ Meeting.
At the Acquisition Merger Effective Time, PubCo shall issue the Founder Earn-Out Shares, being PubCo Class B Ordinary Shares issuable to Mr. Vincent Chok pursuant to Schedule 1 (Earn-out Summary) to the Business Combination Agreement and the Founder Earn-Out Agreement assuming the achievement of all milestones, and directly deposit them into escrow (the “Founder Escrow Shares”). The Founder Escrow Shares shall be released upon the achievement of post-closing milestones as set forth in Schedule 1 (Earn-Out Summary) to the Business Combination Agreement, with any shares for which the applicable milestone is not achieved within the applicable period being forfeited and cancelled.
Conditions to Consummation of the Business Combination
Consummation of the Mergers is subject to the satisfaction or waiver by the respective parties of a number of conditions, including the approval of the Business Combination Agreement and the Mergers by KOYN’s and the Company’s respective shareholders.
Other conditions to each party’s obligations include, among other things: (i) the completion of the Re-domiciliation and Continuation; (ii) the effectiveness of the proxy/registration statement; (iii) the approval of PubCo’s initial listing application with Nasdaq in connection with the Mergers; and (iv) no governmental authority having enacted, issued, promulgated, enforced or entered any law or governmental order that is then in effect and which has the effect of making the closing of the Business Combination illegal or which otherwise prevents or prohibits consummation of the closing of the Business Combination.
3
Other conditions to KOYN’s obligations include, among other things: (i) the Company Fundamental Representations (as defined in the Business Combination Agreement) and certain other Company’s representations and warranties (in each case disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Company Material Adverse Effect” or any similar qualification or exception) being true and correct in all respects at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date, and at and as of the Acquisition Merger Closing Date as if made at the and as of the Acquisition Merger Closing Date; (ii) each of the covenants of the Company and the Acquisition Entities to be performed as of or prior to the Acquisition Merger Closing having been performed in all material respects; (iii) the Company having delivered to KOYN a certificate signed by an authorized director or officer of each of the Company and the Acquisition Entities certifying that certain conditions specified in the Business Combination Agreement have been fulfilled; (iv) there has not been any Event that has had, or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect; (v) there has not been any Legal Proceeding pending or threatened in writing against the Company that has a Company Material Adverse Effect; and (vi) PubCo shall have received all Transaction Documents to which the Company is a party duly executed and delivered by the Company, including without limitation the Sponsor Warrant.
Other conditions to the obligations of the Company, include, among other things: (i) the Acquiror Fundamental Representations (as defined in the Business Combination Agreement) (in each case disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Acquiror Material Adverse Effect” or any similar qualification or exception) being true and correct in all respects at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date, and at and as of the Acquisition Merger Closing Date as if made at the and as of the Acquisition Merger Closing Date, (ii) each of the covenants of Acquiror and the Acquisition Entities to be performed as of or prior to the Acquisition Merger Closing have been performed in all material respects, and (iii) PubCo and Acquisition Entities having delivered to the Company a certificate signed by an authorized director or officer of PubCo certifying that certain conditions specified in the Business Combination Agreement have been fulfilled.
Termination
The Business Combination Agreement may be terminated by mutual written consent of the Company and KOYN and under certain circumstances, including, among other things: (i) by written notice from either the Company or KOYN to the other if any governmental authority has enacted, issued, promulgated, enforced or entered any law or governmental order that is then in effect and which has the effect of making the Acquisition Merger Closing or Reincorporation Merger Closing illegal or which otherwise prevents or prohibits consummation of either of the Mergers, other than any such restraint that is immaterial; (ii) by written notice to KOYN from the Company if the Acquiror Shareholder Approval (as defined in the Business Combination Agreement) has not been obtained by reason of the failure to obtain the required vote at the Acquiror Shareholders’ Meeting; (iii) by written notice to the Company from KOYN if there is any breach of any representation, warranty, covenant or agreement on the part of the Company set forth in the Business Combination Agreement, except that, if such breach is curable by the Company through the exercise of its reasonable best efforts within a certain period; (iv) by written notice from either the Company or KOYN to the other if the Acquisition Merger Closing has not occurred on or before the date that is six (6) months from the date of the Business Combination Agreement; (v) by written notice to the Company from KOYN if the Company Shareholder Approval (as defined in the Business Combination Agreement) has not been obtained by reason of the failure to obtain the required vote at the Company Shareholders’ Meeting; or (vi) by written notice to KOYN from the Company if there is any breach of any representation, warranty, covenant or agreement on the part of KOYN set forth in the Business Combination Agreement, except that, if such breach is curable by KOYN through the exercise of its reasonable best efforts within a certain period.
In the event of the termination of the Business Combination Agreement, the Business Combination Agreement will forthwith become void and have no effect, without any liability on the part of any party thereto or its respective affiliates, officers, directors or shareholders, other than any liability of the Company, PubCo, KOYN, Merger Sub, as the case may be, for any willful and material breach of the Business Combination Agreement occurring prior to the termination.
4
Governing Law and Dispute Resolution
The Business Combination Agreement, and all claims or causes of action based upon, arising out of, or related to it or the transactions contemplated thereby, is governed by, and construed in accordance with, the laws of the State of New York, without giving effect to principles or rules of conflict of laws to the extent such principles or rules would require or permit the application of laws of another jurisdiction.
A copy of the Business Combination Agreement is filed with this Report as Exhibit 2.1 and is incorporated herein by reference. The foregoing description of the Business Combination Agreement does not purport to be complete and is subject to, and is qualified in its entirety by, the full text of the Business Combination Agreement.
Related Agreements
This section describes the material provisions of certain additional agreements entered into or to be entered into pursuant to the Business Combination Agreement (the “Related Agreements”) but does not purport to describe all of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of each of the Related Agreements, copies of each of which are attached hereto as exhibits. Shareholders and other interested parties are urged to read such Related Agreements in their entirety.
Company Shareholders Support Agreements
In connection with the execution of the Business Combination Agreement, on October 6, 2026, the Company, KOYN, and certain shareholders of the Company (the “Requisite Shareholders”), entered into Company Shareholders Support Agreements (the “Company Shareholders Support Agreements”), pursuant to which the Requisite Shareholders agreed to, among other things, (i) subject to certain permitted transfers provided therein, not to transfer any Subject Shares (as defined in the Company Shareholders Support Agreement) until the Expiration Time (as defined in the Company Shareholders Support Agreement), (ii) to vote all the Subject Shares in favor of proposals in connection with the Business Combination, and (iii) to vote all the Subject Shares against the proposals in connection with other alternative business combinations other than the Business Combination with KOYN.
Copies of the Company Shareholders Support Agreements are filed with this Report as Exhibit 10.1 and 10.2 respectively, and are incorporated herein by reference. The foregoing description of the Company Shareholders Support Agreements does not purport to be complete and is qualified in its entirety by the terms and conditions of the form of the Company Shareholders Support Agreement.
Sponsor Support Agreement
In connection with the execution of the Business Combination Agreement, on October 6, 2026, the Company, KOYN, and CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted company (the “Sponsor”), entered into a Sponsor Support Agreement (the “Sponsor Support Agreement”), pursuant to which the Sponsor agreed to, among other things, (i) subject to certain permitted transfers provided therein, not to transfer any Subject Shares (as defined in the Sponsor Support Agreement) until the Expiration Time (as defined in the Sponsor Support Agreement), (ii) to vote all the Subject Shares in favor of proposals in connection with the Business Combination, and (iii) to vote all the Subject Shares against the proposals in connection with other alternative business combinations other than the Business Combination with the Company.
A copy of the Sponsor Support Agreement is filed with this Report as Exhibit 10.3 and is incorporated herein by reference. The foregoing description of the Sponsor Support Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Sponsor Support Agreement.
5
Form of Registration Rights Agreement
In connection with the execution of the Business Combination Agreement, prior to the Reincorporation Merger Effective Tine, PubCo and certain other parties thereto will enter into a Registration Rights Agreement (the “Registration Rights Agreement”), pursuant to which PubCo will grant certain registration rights with respect to PubCo’s securities held by such other parties following the closing of the Business Combination.
A form of the Registration Rights Agreement is filed with this Report as Exhibit 10.4 and is incorporated herein by reference. The foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Registration Rights Agreement.
Form of Lock-Up Agreements
Prior to the Acquisition Merger Effective Time, PubCo is expected to enter into lock-up agreements (the “Lock-up Agreements”) with its directors, officers, and certain other shareholders who will hold more than 5% of the issued and outstanding shares of PubCo Ordinary Shares upon the Acquisition Merger Effective Time. Pursuant to the Lock-Up Agreements, such parties will, subject to certain customary exceptions, agree not to sell, offer to sell, contract or agree to sell, pledge or otherwise dispose of, directly or indirectly, any PubCo Ordinary Shares, or any rights, options, warrants or other securities convertible into or exercisable or exchangeable for any PubCo Ordinary Shares (including any PubCo Ordinary Shares issuable upon the exercise of any such securities) (collectively, the “Subject Securities”) held by them immediately after the Acquisition Merger Effective Time until the earlier to occur of: (A) 180 days after Acquisition Merger Effective Time, or (B) the date on which PubCo completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of PubCo’s shareholders having the right to exchange their PubCo Ordinary Shares or other equity securities of PubCo for cash, securities or other property. Notwithstanding the foregoing, after at least 120 days after the Acquisition Merger Effective Time, (a) 25% of the Subject Securities shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $12.00 for 20 consecutive trading days, (b) up to 50% of the Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $14.00 for 20 consecutive trading days, (c) up to 75% of the Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $16.00 for 20 consecutive trading days, and (d) all Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $18.00 for 20 consecutive trading days.
A form of the Lock-Up Agreements is filed with this Report as Exhibit 10.5 and is incorporated herein by reference. The foregoing description of the Lock-Up Agreements does not purport to be complete and is qualified in its entirety by the terms and conditions of the Lock-Up Agreement.
Form of Sponsor Share Restructuring Agreement and Sponsor Warrant
Immediately prior to the Acquisition Merger Effective Time, the Sponsor and PubCo will enter into a sponsor share restructuring agreement (the “Sponsor Share Restructuring Agreement”), providing that: (a) 1,891,667 Sponsor PubCo Shares (or a quarter of Sponsor PubCo Shares that Founder Shares will be exchanged for at the Reincorporation Effective Time) shall be forfeited at the Acquisition Merger Effective Time in exchange for a warrant to purchase (i) 1,891,667 PubCo Class A Ordinary Shares plus (ii) PubCo Class A Ordinary Shares in an amount equal to the Remaining Working Capital Warrant Coverage, substantially in the form of Sponsor Warrant (the “Sponsor Warrant”). The PubCo Class A Ordinary Shares issuable upon exercise of the Sponsor Warrant shall be Registrable Securities (as defined in the Registration Rights Agreement) and shall be registered for resale along with the other securities contemplated by the Registration Rights Agreement in accordance with the terms thereof; and (b) 1,891,667 Sponsor PubCo Shares shall be deposited into escrow at the Acquisition Merger Effective Time and released upon the achievement of post-closing milestones as set forth in Schedule 1 (Earn-Out Summary) to the Business Combination Agreement, with any shares for which the applicable milestone is not achieved within the applicable period being forfeited and cancelled.
Forms of the Sponsor Warrant are filed with this Report as Exhibit 10.6 respectively, and are incorporated herein by reference. The foregoing description of the Sponsor Share Restructuring Agreement and the Sponsor Warrant do not purport to be complete and are qualified in their entirety by the terms and conditions of the Sponsor Share Restructuring Agreement and the Sponsor Warrant.
6
Form of Joinder Agreement
As promptly as practicable following the date of the Business Combination Agreement and in any event prior to the initial filing of the Registration Statement with the SEC, Acquiror shall cause Merger Sub to be formed in the Cayman Islands solely for the purpose of engaging in the transactions contemplated by the Business Combination Agreement. When it is formed, the Merger Sub shall be wholly-owned by Acquiror. Following the formation of Merger Sub, the Acquiror shall cause Merger Sub to execute and deliver to the parties to Business Combination Agreement a joinder agreement (the “Joinder Agreement”), pursuant to which, among other things, Merger Sub shall become a party to the Business Combination Agreement as of the date of the Business Combination Agreement.
A form of Joinder Agreement is filed with this Report as Exhibit 10.7 and is incorporated herein by reference. The foregoing description of form of Joinder Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Joinder Agreement.
Item 7.01 Regulation FD Disclosure.
On October 6, 2026, KOYN and the Company issued a joint press release announcing the execution of the Business Combination Agreement and the proposed Business Combination, a copy of which is furnished as Exhibit 99.1 to this Report and incorporated into this Item 7.01 by reference.
Furnished as Exhibit 99.2 to this Report and incorporated by reference into this Item 7.01 is an investor presentation (the “Investor Presentation”), that the Company and KOYN have prepared for use in connection with the Business Combination.
The information in this Item 7.01, including Exhibits 99.1 and 99.2, is being furnished pursuant to Item 7.01 and will not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise be subject to the liabilities of that section, nor will it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Securities Exchange Act of 1934, as amended. This Report should not be deemed an admission as to the materiality of any information contained in the press release or the investor presentation. KOYN and the Company do not undertake any obligation to update the press release or the investor presentation.
Additional Information and Where to Find It
The proposed transactions will be submitted to shareholders of the Company for their consideration and approval. The Company, the PubCo, and KOYN intend to jointly file a registration statement (the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”) which will include a preliminary proxy statement in connection with the KOYN’s solicitation for proxies for the vote by the KOYN’s shareholders in connection with the proposed Business Combination and other matters as described in the Registration Statement, as well as a prospectus relating to the offer of the securities to be issued in connection with the proposed Business Combination. After the Registration Statement is filed and declared effective, KOYN will mail a definitive proxy statement and other relevant documents to its shareholders as of the record date established for voting on the proposed Business Combination. KOYN’s shareholders and other interested persons are advised to read, once available, the preliminary proxy statement/prospectus and any amendments thereto and, once available, the definitive proxy statement/prospectus, in connection with the KOYN’s solicitation of proxies for its extraordinary general meeting of shareholders to be held to approve, among other things, the proposed Business Combination, because these documents will contain important information about KOYN, the Company and the proposed transactions. Shareholders may also obtain a copy of the preliminary or definitive proxy statement/prospectus, once available, as well as other documents filed with the SEC regarding the proposed Business Combination and other documents filed with the SEC by the Company, the PubCo and KOYN, without charge, at the SEC’s website located at www.sec.gov or by directing a request to the Company.
7
Participants in the Solicitation
KOYN, the Company, PubCo and their respective directors, executive officers, and other members of management and employees may, under SEC rules, be deemed to be participants in the solicitations of proxies from KOYN’s shareholders in connection with the proposed transactions contemplated by the Business Combination Agreement. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of the KOYN’s shareholders in connection with the proposed transactions will be set forth in the proxy statement/prospectus to be filed with the SEC in connection with the Mergers. You can find more information about KOYN’s directors and executive officers in the KOYN’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the SEC on March 19, 2026. Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests will be included in the proxy statement/prospectus when it becomes available. Shareholders, potential investors and other interested persons should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from the sources indicated above.
Forward-Looking Statements
Certain statements made in this Report are forward-looking statements. When used in this Report, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the KOYN’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: the inability of the Company and KOYN to consummate the Mergers within the time provided in the KOYN’s amended and restated memorandum and articles of association; performance of the Company’s business; the risk that the approval of the shareholders of the KOYN for the Mergers is not obtained; failure to realize the anticipated benefits of the Mergers, including as a result of a delay in consummating the Mergers; the level of redemptions made by the KOYN’s shareholders and its impact on the amount of funds available in the KOYN’s trust account to complete the Mergers; risks relating to the combined company’s sources of cash and cash resources; risks relating to the combined company’s ability to manage future growth; the effects of competition on the combined company’s future business; the outcome of any potential litigation, government and regulatory proceedings, any investigations and inquiries involving the parties to the transactions; the impact of pandemics, global conflicts, the global economic status or tariffs on the Company’s or the combined company’s business; and those factors discussed in the KOYN’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the SEC on March 19, 2026, and other documents of the Company, the PubCo, and KOYN filed, or to be filed, with the SEC. PubCo, the Company or KOYN expressly disclaims any obligation or undertaking to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
No Offer or Solicitation
This Report shall not constitute a solicitation of a proxy, consent, or authorization with respect to any securities or in respect of any business combination. This Report shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act, or an exemption therefrom.
8
Item 9.01 Financial Statements and Exhibits.
| Exhibit No. | Description | |
| 2.1* | Business Combination Agreement dated October 6, 2026. | |
| 10.1* | Company Shareholders Support Agreement dated October 6, 2026 by and between First Digital and Nemi Limited. | |
| 10.2* | Company Shareholders Support Agreement dated October 6, 2026 by and among First Digital, Vincent Chok, and Noble Elite Ltd. | |
| 10.3* | Sponsor Support Agreement dated October 6, 2026. | |
| 10.4 | Form of Registration Rights Agreement | |
| 10.5 | Form of Lock-up Agreement. | |
| 10.6 | Form of Sponsor Warrant | |
| 10.7 | Form of Joinder agreement | |
| 10.8* | Form of Binance PubCo Warrant | |
| 10.9* | Form of Noble Elite PubCo Warrant | |
| 99.1 | Press Release dated October 6, 2026. | |
| 99.2 | Investor Presentation | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
| * | The exhibits and schedules to this Exhibit have been omitted in accordance with Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish supplementally to the SEC a copy of all omitted exhibits and schedules upon its request. |
9
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CSLM DIGITAL ASSET ACQUISITION CORP III, LTD | ||
| Date: October 6, 2026 | By: | /s/ Vikas Mittal |
| Name: | Vikas Mittal | |
| Title: | Chief Financial Officer | |
10
Exhibit 2.1
BUSINESS COMBINATION AGREEMENT
by and among
CSLM III Holdings, LTD
CSLM DIGITAL ASSET ACQUISITION CORP III, LTD,
FIRST DIGITAL GROUP LTD.
and
SUCH OTHER PARTIES THAT MAY BECOME PARTIES HERETO
dated October 6, 2026
Table of Contents
| BUSINESS COMBINATION AGREEMENT | 1 | |||
|---|---|---|---|---|
| Article I | CERTAIN DEFINITIONS | 3 | ||
| Article II | THE MERGERS; MERGER CLOSING | 16 | ||
| Article III | EFFECTS OF THE MERGERS ON COMPANY AND ACQUIROR EQUITY SECURITIES | 19 | ||
| Article IV | REPRESENTATIONS AND WARRANTIES OF THE COMPANY | 23 | ||
| Article V | REPRESENTATIONS AND WARRANTIES OF ACQUIROR | 43 | ||
| Article VI | REPRESENTATIONS AND WARRANTIES OF THE ACQUISITION ENTITIES | 52 | ||
| Article VII | COVENANTS OF THE COMPANY | 55 | ||
| Article VIII | COVENANTS OF ACQUIROR | 59 | ||
| Article IX | JOINT COVENANTS | 63 | ||
| Article X | CONDITIONS TO CLOSING | 73 | ||
| Article XI | TERMINATION/EFFECTIVENESS | 76 | ||
| Article XII | MISCELLANEOUS | 77 | ||
Exhibits
Exhibit A Form of PubCo Charter
Exhibit B Company Shareholders Support Agreement
Exhibit C Sponsor Support Agreement
Exhibit D Registration Rights Agreement
Exhibit E Form of Lock-up Agreement
Exhibit F Form of Sponsor Warrant
Exhibit G Form of Joinder Agreement
Exhibit H Form of Binance PubCo Warrant
Exhibit I Form of Noble Elite PubCo Warrant
Schedules
Schedule 1 Earn-Out Summary
i
INDEX OF DEFINED TERMS
| $ | Section 1.1 | |
| Acquiror | Preamble | |
| Acquiror Acquisition Proposal | Section 1.1 | |
| Acquiror Board | Section 1.1 | |
| Acquiror Board Recommendation | Section 9.2(b)(iii) | |
| Acquiror Charter | Section 1.1 | |
| Acquiror Class A Ordinary Shares | Section 1.1 | |
| Acquiror Class B Ordinary Shares | Section 1.1 | |
| Acquiror Cure Period | Section 11.1(g) | |
| Acquiror Disclosure Letter | Article V | |
| Acquiror Financial Statements | Section 5.6(c) | |
| Acquiror Fundamental Representations | Section 1.1 | |
| Acquiror Group | Section 12.20(a) | |
| Acquiror Indemnified Parties | Section 9.6(a) | |
| Acquiror Material Adverse Effect | Section 1.1 | |
| Acquiror Ordinary Shares | Section 1.1 | |
| A Acquiror Public Shares | Section 1.1 | |
| Acquiror Redemption Price | Section 1.1 | |
| Acquiror SEC Filings | Section 5.5(a) | |
| Acquiror Share Redemption | Section 1.1 | |
| Acquiror Shareholders’ Approval | Section 1.1 | |
| Acquiror Shareholder Redemption Right | Section 1.1 | |
| Acquiror Shareholders | Section 1.1 | |
| Acquiror Shareholders’ Meeting | Section 9.2(b)(i) | |
| Acquiror Transaction Expenses | Section 1.1 | |
| Acquiror Transaction Expense Cap | Section 1.1 | |
| Acquiror Unit | Section 1.1 | |
| Acquiror Warrant Agreement | Section 1.1 | |
| Acquiror Warrants | Section 1.1 | |
| Acquisition Entities | Section 1.1 | |
| Acquisition Entity Fundamental Representations | Section 1.1 | |
| Acquisition Entity Fundamental Representations | Section 1.1 | |
| Acquisition Intended Tax Treatment | Recitals | |
| Action | Section 1.1 | |
| Adjusted Price | Section 8.11 | |
| Adjustment Period | Section 8.11 | |
| Affiliate | Section 1.1 | |
| Agreement | Preamble | |
| Agreement End Date | Section 11.1(e) | |
| AI | Section 1.1 | |
| AI Inputs | Section 1.1 | |
| AI Laws | Section 4.20(f) | |
| AI Technology | Section 1.1 | |
| Alternative Proposal | Section 1.1 | |
| Anti-Bribery Laws | Section 1.1 | |
| Anti-Money Laundering Laws | Section 1.1 | |
| Applicable Price | Section 8.11 | |
| Articles of the Surviving Company | Section 2.3(d) |
ii
| Binance Warrantholder | Section 1.1 | |
| Binance Company Warran | Section 1.1 | |
| Business Combination | Section 1.1 | |
| Business Day | Section 1.1 | |
| Cayman Companies Act | Recitals | |
| Cayman Registrar | Section 1.1 | |
| CCM | Section 1.1 | |
| Closing Filing | Section 9.7(b) | |
| Closing Press Release | Section 9.7(b) | |
| Code | Recitals | |
| Company | Preamble | |
| Company AI | Section 1.1 | |
| Code | Section 1.1 | |
| Collateral Securitie | Recitals | |
| Company Benefit Plan | Section 1.1 | |
| Company Board | Section 1.1 | |
| Company Board Recommendation | Section 9.2(c)(ii) | |
| Company Charter | Section 1.1 | |
| Company Cure Period | Section 11.1(d) | |
| Company Data | Section 1.1 | |
| Company Disclosure Letter | Article IV | |
| Company Exchanging Share | Section 1.1 | |
| Company Founder | Section 1.1 | |
| Company Fundamental Representations | Section 1.1 | |
| Company Group | Section 12.20(b) | |
| Company Indemnified Parties | Section 9.6(a) | |
| Company Intellectual Property | Section 1.1 | |
| Company Licensed IP | Section 1.1 | |
| Company Material Adverse Effect | Section 1.1 | |
| Company Ordinary Shares | Section 1.1 | |
| Company Owned IP | Section 1.1 | |
| Company Preference Shares | Section 1.1 | |
| Company Products | Section 1.1 | |
| Company Related Party | Section 1.1 | |
| Company Shareholder | Section 1.1 | |
| Company Shareholder Approval | Section 4.3(b) | |
| Company Shareholders’ Meeting | Section 9.2(c)(i) | |
| Company Shareholder Spreadsheet | Section 3.2(b) | |
| Company Shareholders Support Agreement | Recitals | |
| Company Shares | Section 1.1 | |
| Company Transaction Expenses | Section 1.1 | |
| Company Valuation | Section 1.1 | |
| Company Website | Section 1.1 | |
| Company Written Objection | Section 2.3(b) | |
| Confidentiality Agreement | Section 4.29 | |
| Contracts | Section 1.1 | |
| COTS Technology | Section 1.1 | |
| Copyrightable Works | Section 4.19(a) | |
| D&O Indemnified Parties | Section 9.6(a) | |
| Disclosure Letter | Section 1.1 | |
| Dissenting Company Shareholders | Section 3.4(a) | |
| Dissenting Company Shares | Section 3.4(a) | |
| DLA | Section 12.20(b) | |
| DTC | Section 1.1 |
iii
| Environmental Laws | Section 1.1 | |
| Equity Securities | Section 1.1 | |
| ERISA | Section 1.1 | |
| Events | Section 1.1 | |
| Exchange Act | Section 1.1 | |
| Exchange Ratio | Section 1.1 | |
| FDG Token | Section 1.1 | |
| Founder Shares | Section 1.1 | |
| Financial Statements | Section 4.8(a) | |
| Acquisition Merger Closing | Section 2.3(a) | |
| Acquisition Merger Closing Date | Section 2.3(a) | |
| Acquisition Merger | Recitals | |
| Acquisition Merger Consideration | Section 1.1 | |
| Acquisition Merger Effective Time | Section 2.3(a) | |
| GAAP | Section 1.1 | |
| Generative AI Tools | Section 1.1 | |
| Gibraltar Companies Act | Recitals | |
| Governing Documents | Section 1.1 | |
| Government Official | Section 1.1 | |
| Governmental Authority | Section 1.1 | |
| Governmental Authorization | Section 4.5 | |
| Governmental Order | Section 1.1 | |
| Hazardous Material | Section 1.1 | |
| IFRS | Section 1.1 | |
| Inbound IP Agreements | Section 1.1 | |
| Indebtedness | Section 1.1 | |
| Intellectual Property | Section 1.1 | |
| Intellectual Property Agreements | Section 1.1 | |
| Intellectual Property Registrations | Section 1.1 | |
| Inbound IP Agreements | Section 1.1 | |
| Intended Tax Treatment | Recitals | |
| Interim Period | Section 7.1 | |
| International Trade Laws | Section 1.1 | |
| Investment Company Act | Section 1.1 | |
| IPO | Section 5.8 | |
| IRS | Section 1.1 | |
| JOBS Act | Section 1.1 | |
| Law | Section 1.1 | |
| Leased Real Property | Section 1.1 | |
| Legal Proceedings | Section 4.10 | |
| Licenses | Section 1.1 | |
| Lien | Section 1.1 | |
| Lock-up Agreement | Recitals | |
| Merger Sub | Preamble | |
| Nasdaq | Section 5.17 | |
| Nemi | Section 1.1 | |
| Non-Recourse Parties | Section 12.18(b) | |
| Ordinary Share Equivalents | Section 8.11 | |
| Outbound IP Agreements | Section 1.1 |
iv
| PCAOB | Section 1.1 | |
| Permitted Liens | Section 1.1 | |
| Person | Section 1.1 | |
| Personal Information | Section 1.1 | |
| Personnel IP Contracts | Section 4.19(c) | |
| Plan of Acquisition Merger | Section 1.1 | |
| Plan of Reincorporation Merger | Section 1.1 | |
| Privacy Laws | Section 1.1 | |
| Proxy/Registration Statement | Section 9.2(a)(i) | |
| PubCo Charter | Section 2.1 | |
| PubCo Class A Ordinary Shares | Section 1.1 | |
| PubCo Class B Ordinary Shares | Section 1.1 | |
| PubCo Ordinary Shares | Section 1.1 | |
| PubCo Warrants | Section 1.1 | |
| Real Property Leases | Section 4.18(a)(ii) | |
| Redeeming Acquiror Shares | Section 1.1 | |
| Registration Rights Agreement | Recitals | |
| Regulatory Approvals | Section 9.1(a) | |
| Related Party Agreements | Section 4.12(a)(vi) | |
| Remaining Trust Fund Proceeds | Section 8.1 | |
| Remaining Working Capital Amount | Section 1.1 | |
| Remaining Working Capital Warrant Coverage | Section 1.1 | |
| Representatives | Section 1.1 | |
| Requisite Company Shareholders | Section 1.1 | |
| restraint | Section 10.1(g) | |
| Restricted Person | Section 1.1 | |
| Sanctioned Jurisdiction | Section 1.1 | |
| Sanctioned Person | Section 1.1 | |
| Sanctions | Section 1.1 | |
| Sarbanes-Oxley Act | Section 1.1 | |
| Stablecoin Issuance | Recitals | |
| SEC | Section 1.1 | |
| Reincorporation Intended Tax Treatment | Recitals | |
| Reincorporation Merger Closing | Section 2.2(a) | |
| Reincorporation Merger Closing Date | Section 2.2(a) | |
| Reincorporation Merger | Recitals | |
| Reincorporation Merger Consideration | Section 1.1 | |
| Reincorporation Merger Effective Time | Section 2.2(a) | |
| Re-domiciliation and Continuation Intended Tax Treatment | Recitals | |
| Securities Act | Section 1.1 | |
| Security Incident | Section 4.20(c) | |
| Signing Filing | Section 9.7(b) | |
| Signing Press Release | Section 9.7(b) | |
| Software | Section 1.1 | |
| Sponsor | Section 1.1 | |
| Sponsor PubCo Shares | Section 1.1 | |
| Sponsor Support Agreement | Recitals | |
| Subsidiary | Section 1.1 | |
| Surviving Company | Recitals | |
| Surviving Company Share | Section 1.1 | |
| Surviving Acquiror | Recitals |
v
| Tax | Section 1.1 | |
| Tax Return | Section 1.1 | |
| Taxes | Section 1.1 | |
| Technical Documentation | Section 1.1 | |
| Terminating Acquiror Breach | Section 11.1(g) | |
| Third Party Data | Section 1.1 | |
| Transaction Document | Section 1.1 | |
| Transaction Financing | Section 9.8 | |
| Transaction Financing Agreements | Section 9.8 | |
| Transaction Proposals | Section 9.2(a)(i) | |
| Transactions | Section 1.1 | |
| Treasury Regulations | Section 1.1 | |
| Trust Account | Section 5.8 | |
| Trust Agreement | Section 5.8 | |
| Trustee | Section 5.8 | |
| Unit Separation | Section 3.1(a)(i) | |
| Unregistered Marks | Section 4.19(a) | |
| Working Capital Amount | Section 8.11 | |
| wholly-owned Subsidiary | Section 1.1 |
vi
BUSINESS COMBINATION AGREEMENT
This Business Combination Agreement, dated October 6, 2026 (this “Agreement”), is made and entered into by and among CSLM III Holdings Ltd, a Cayman Islands exempted company limited by shares with registration number 435166 (“PubCo”), CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares with registration number 412434 (“Acquiror”), First Digital Group Ltd., a Gibraltar private company limited by shares with registration number 121963 (the “Company”), and such other parties that join this Agreement by signing the Joinder Agreement (as defined below) (collectively, the “Parties” or “parties”).
RECITALS
WHEREAS, Acquiror is a blank check company incorporated as a Cayman Islands exempted company limited by shares and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses;
WHEREAS, Acquiror has established PubCo in the Cayman Islands, as a direct wholly owned subsidiary of Acquiror, for the purpose of effectuating the transactions contemplated by this Agreement (inclusive of the Reincorporation Merger), with the objective of acting as the publicly traded holding company for its Subsidiaries;
WHEREAS, Acquiror will establish a Cayman Islands exempted company limited by shares (“Merger Sub”), as a direct wholly-owned subsidiary of Acquiror, for the purpose of effectuating the transactions contemplated by this Agreement (inclusive of the Acquisition Merger);
WHEREAS, the Parties hereto desire and intend to effect a business combination transaction whereby (a) at least one (1) Business Day prior to the Reincorporation Merger Closing Date (as defined below), the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Companies Act 2014 of Gibraltar and Companies (Re-Domiciliation) Regulations 1996 of Gibraltar (the “Gibraltar Companies Act”) and the Companies Act (2026 Revision) of the Cayman Islands (the “Cayman Companies Act”) (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity (for the periods from and after the Reincorporation Merger Effective Time (as defined below), PubCo may also be referred to as the “Surviving Acquiror”), and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Re-domiciliation and Continuation and the Reincorporation Merger and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo (for the periods from and after the Acquisition Merger Effective Time (as defined below), the Company may also be referred to as the “Surviving Company”), with each of the Mergers to occur upon the terms and subject to the conditions of this Agreement and in accordance with the Cayman Companies Act;
WHEREAS, upon the Reincorporation Merger Effective Time, (i) all of the issued and outstanding securities of Acquiror immediately prior to the Reincorporation Merger Effective Time shall no longer be issued and outstanding and shall automatically be cancelled, in exchange for the right of the holders thereof to receive certain securities of PubCo as determined in accordance with this Agreement, and (ii) each share of PubCo issued and outstanding as of immediately prior to the Reincorporation Merger Effective Time shall no longer be issued and outstanding and shall automatically be cancelled, in each case, upon the terms and subject to the conditions set forth in this Agreement and in accordance with the provisions of the Cayman Companies Act and other applicable laws;
WHEREAS, upon the Acquisition Merger Effective Time, (i) each Company Exchanging Share shall automatically be cancelled and converted into, and shall thereafter represent the right of each holder of the Company Exchanging Shares to receive, such number of newly issued PubCo Ordinary Shares as determined in accordance with this Agreement, and (ii) each share of Merger Sub issued and outstanding as of immediately prior to the Acquisition Merger Effective Time shall automatically be converted into one (1) Surviving Company Share and accordingly, the Surviving Company shall become a wholly-owned subsidiary of PubCo;
WHEREAS, the Parties intend for the Reincorporation Merger to qualify as a reorganization described in Section 368(a)(1)(F) of the Code (the “Reincorporation Intended Tax Treatment”);
1
WHEREAS, the parties intend for the Re-domiciliation and Continuation to qualify as a reorganization described in Section 368(a)(1)(F) of the Code (the “Re-domiciliation and Continuation Intended Tax Treatment”);
WHEREAS, the parties intend for the Acquisition Merger to qualify as a reorganization described in Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code (“Acquisition Intended Tax Treatment” and, together with the Reincorporation Intended Tax Treatment and the Re-domiciliation and Continuation Intended Tax Treatment, the “Intended Tax Treatment”);
WHEREAS, the board of directors of PubCo has (i) determined that it is advisable for PubCo to enter into this Agreement and the other Transaction Documents to which PubCo is a party, and (ii) approved the execution and delivery of this Agreement and the other Transaction Documents to which PubCo is a party and the transactions contemplated hereby and thereby (including the Mergers);
WHEREAS, the Company Board (as defined below) has (i) determined that it is advisable for the Company to enter into this Agreement and the other Transaction Documents to which the Company is a party, (ii) approved the execution and delivery of this Agreement and the other Transaction Documents to which the Company is a party and the transactions contemplated hereby and thereby (including the Re-domiciliation and Continuation and the Acquisition Merger), and (iii) recommended the adoption and approval of this Agreement and the other Transaction Documents to which the Company is a party and the transactions contemplated hereby and thereby (including the Acquisition Merger) by the Company Shareholders;
WHEREAS, the Acquiror Board (as defined below) has (i) determined that it is advisable for Acquiror to enter into this Agreement and the other Transaction Documents to which Acquiror is a party, (ii) approved the execution and delivery of this Agreement and the other Transaction Documents to which Acquiror is a party and the transactions contemplated hereby and thereby (including the Mergers), and (iii) recommended the adoption and approval of this Agreement and the other Transaction Documents to which Acquiror is a party and the transactions contemplated hereby and thereby (including the Mergers) by the Acquiror Shareholders;
WHEREAS, in furtherance of the Mergers and in accordance with the terms hereof, Acquiror shall provide an opportunity to its shareholders to have their issued and outstanding Acquiror Public Shares redeemed on the terms and subject to the conditions set forth in this Agreement and Acquiror’s Governing Documents (as defined below) in connection with obtaining the Acquiror Shareholders’ Approval (as defined below);
WHEREAS, the Parties are currently contemplating a FDUSD stablecoin issuance on terms and conditions as may be agreed by the Company and Acquiror which may be collateralized by convertible notes or other securities of the Company or one of its Subsidiaries (such securities, “Collateral Securities”) (such issuance of stablecoin, “Stablecoin Issuance”);
WHEREAS, as a condition and inducement to Acquiror’s and PubCo’s willingness to enter into this Agreement, simultaneously with the execution and delivery of this Agreement, the Requisite Company Shareholders (as defined below) have each executed and delivered to Acquiror and PubCo the Company Shareholders Support Agreement substantially in the form attached hereto as Exhibit B (the “Company Shareholders Support Agreement”);
WHEREAS, as a condition and inducement to the Company’s willingness to enter into this Agreement, simultaneously with the execution and delivery of this Agreement, the Sponsor has executed and delivered to the Company the Sponsor Support Agreement in the form attached hereto as Exhibit C (the “Sponsor Support Agreement”);
WHEREAS, prior to the Reincorporation Merger Effective Time, Acquiror, Sponsor, PubCo and certain other parties thereto shall have entered into a registration rights agreement in the form attached hereto as Exhibit D (the “Registration Rights Agreement”); and
WHEREAS, prior to the Acquisition Merger Effective Time, Sponsor, Company Founder and certain other parties thereto shall have entered into a lock-up agreement substantially in the form attached hereto as Exhibit E (the “Lock-up Agreement”).
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth in this Agreement and intending to be legally bound hereby, Acquiror and the Company, and upon their execution and delivery of the Joinder Agreement, the other Parties, agree as follows:
2
ARTICLE I
CERTAIN DEFINITIONS
Section 1.1. Definitions. As used herein, the following terms shall have the following meanings:
“$” means lawful money of the United States.
“Acquiror Acquisition Proposal” means (i) any Business Combination, in one transaction or a series of transactions, involving Acquiror or any of its current or future controlled Affiliates or involving all or a material portion of the assets, equity securities or businesses of Acquiror or its current or future controlled Affiliates (whether by merger, consolidation, recapitalization, purchase or issuance of equity securities, purchase of assets, tender offer or otherwise); or (ii) any equity or similar investment in or by Acquiror and/or any of its controlled Affiliates, in each case, other than the Transactions.
“Acquiror Board” means the board of directors of Acquiror.
“Acquiror Charter” means the second amended and restated memorandum and articles of association of Acquiror as may be amended from time to time.
“Acquiror Class A Ordinary Shares” means Class A ordinary shares, par value $0.0001 per share, of Acquiror.
“Acquiror Class B Ordinary Shares” means Class B ordinary shares, par value $0.0001 per share, of Acquiror.
“Acquiror Fundamental Representations” means the representations and warranties made pursuant to Section 5.1 (Acquiror Organization), Section 5.2 (Due Authorization), Section 5.3 (No Conflict), the final sentence of Section 5.11 (Undisclosed Liabilities), Section 5.12 (Capitalization of Acquiror) and Section 5.13 (Brokers’ Fees).
“Acquiror Material Adverse Effect” means any event, state of facts, development, circumstance, occurrence or effect (collectively, “Events”) that (i) has had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the business, assets and liabilities, results of operations, prospects or financial condition of Acquiror, taken as a whole or (ii) does or would reasonably be expected to, individually or in the aggregate, prevent or materially adversely affect the ability of Acquiror to consummate the Transactions; provided that in no event would any of the following, alone or in combination, be deemed to constitute, or be taken into account in determining whether there has been or will be, an Event under clause (i) of the definition of an “Acquiror Material Adverse Effect”: (a) any change in applicable Laws or GAAP or any interpretation thereof following the date of this Agreement, (b) any change in interest rates or economic, political, business or financial market conditions generally, (c) the taking of any action required to be taken under this Agreement, (d) any natural disaster (including hurricanes, storms, tornados, flooding, earthquakes, volcanic eruptions or similar occurrences), cyberattacks, epidemic or pandemic, acts of nature or change in climate, (e) any acts of terrorism or war, the outbreak or escalation of hostilities, geopolitical conditions, local, national or international political conditions, (f) any action taken by, or at the request of, the Company; (g) the announcement of this Agreement and consummation of the Transactions, including any termination of, reduction in or similar adverse impact (but in each case only to the extent attributable to such announcement or consummation) on Acquiror’s relationships, contractual or otherwise, with third parties or (h) any change in the trading price or volume of the Acquiror Units, Acquiror Ordinary Shares, or Acquiror Warrants (provided that the underlying causes of such changes referred to in this clause (h) may be considered in determining whether there is an Acquiror Material Adverse Effect except to the extent such cause is otherwise excluded under any of clauses (a) through (g) of this definition); provided, further, that in the case of each of clauses (a), (b), (d) and (e), any such Event to the extent such Event disproportionately and adversely affects Acquiror relative to other similarly situated special purpose acquisition companies shall not be excluded from and shall be taken into account in the determination of whether there has been, or would reasonably be expected to be, an Acquiror Material Adverse Effect, but only to the extent of the incremental disproportionate effect on the Acquiror relative to such similarly situated special purpose acquisition companies. Notwithstanding the foregoing, with respect to Acquiror, the number of Acquiror Shareholders who exercise their Acquiror Shareholder Redemption Right or the failure to obtain Acquiror Shareholders’ Approval shall be deemed not to be an Acquiror Material Adverse Effect.
3
“Acquiror Ordinary Shares” means Acquiror Class A Ordinary Shares and Acquiror Class B Ordinary Shares, as applicable.
“Acquiror Public Shares” means the Acquiror Class A Ordinary Shares issued and outstanding that were initially sold in the initial public offering of Acquiror (including the offering in connection with the exercise of the over-allotment option).
“Acquiror Redemption Price” means a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the Trust Account (such interest shall be net of taxes payable) and not previously released to the Acquiror to pay its taxes, divided by the number of then issued Acquiror Public Shares, in connection with obtaining Acquiror Shareholders’ Approval.
“Acquiror Share Redemption” means the election of an eligible (as determined in accordance with Acquiror’s Governing Documents) holder of Acquiror Public Shares to redeem all or a portion of the Acquiror Public Shares held by such holder at the Acquiror Redemption Price in connection with the transactions contemplated by this Agreement.
“Acquiror Shareholder Redemption Right” means the right of an eligible (as determined in accordance with Acquiror’s Governing Documents) holder of Acquiror Public Shares to redeem all or a portion of the Acquiror Public Shares held by such holder at a per-share price, payable in cash, equal to a pro rata share of the aggregate amount on deposit in the Trust Account (including any interest earned on the funds held in the Trust Account) (as determined in accordance with Acquiror’s Governing Documents) in connection with the Transaction Proposals.
“Acquiror Shareholders” means the holders of Acquiror Ordinary Shares as of the record date for the purpose of Acquiror Shareholders’ Approval.
“Acquiror Transaction Expenses” means any and all documented out-of-pocket fees and expenses paid or payable by Acquiror, Sponsor or its Affiliates (whether or not billed or accrued for) as a result of or in connection with Acquiror’s negotiation, documentation and consummation of the Transactions, including (a) all fees (excluding (i) fees of the underwriters of the IPO with respect to deferred underwriting commissions, and (ii) fees deposited into the Trust Account to extend the period of time Acquiror has to consummate its initial business combination in accordance with Acquiror’s Governing Documents), costs, expenses, brokerage fees, commissions, finders’ fees and disbursements of financial advisors, investment banks, data room administrators, attorneys, accountants and other advisors and service providers, including consultants and public relations firms and (b) any and all filing fees paid or payable by Acquiror, Sponsor or its Affiliates to Governmental Authorities in connection with the Transactions.
“Acquiror Transaction Expense Cap” means $4,500,000, but excluding any Acquiror Transaction Expenses paid or payable out of the Working Capital Amount.
“Acquiror Unit” means collectively (i) the public units issued by Acquiror in the IPO (including pursuant to the exercise of the underwriters’ overallotment option), and (ii) the private units issued by Acquiror to the Sponsor and CCM in a private placement in conjunction with its IPO, in each case of a public unit or a private unit, consisting of one Acquiror Class A Ordinary Share and one-half of an Acquiror Warrant.
“Acquiror Warrant Agreement” means the Warrant Agreement, dated August 26, 2025, between Acquiror and Continental Stock Transfer & Trust Company.
“Acquiror Warrants” means the warrants to purchase one (1) Acquiror Class A Ordinary Share at an exercise price of $11.50 (subject to adjustment as set forth therein) issued prior to the date of this Agreement, with the terms as set forth therein and in the Acquiror Warrant Agreement.
“Acquisition Entities” means PubCo and Merger Sub and “Acquisition Entity” means either of them.
4
“Acquisition Entity Fundamental Representations” means the representations and warranties made pursuant to Section 6.1 (Acquisition Entity Organization), Section 6.2 (Due Authorization), Section 6.3 (No Conflict) and Section 6.7 (Brokers’ Fees).
“Acquisition Merger Consideration” means the PubCo Ordinary Shares receivable by Company Shareholders pursuant to Section 3.1(b)(i).
“Action” means any claim, action, suit, audit, examination, assessment, arbitration, mediation or formal inquiry, or any proceeding or investigation, by or before any Governmental Authority.
“Affiliate” means, with respect to any specified Person, any Person that, directly or indirectly, controls, is controlled by, or is under common control with, such specified Person, whether through one or more intermediaries or otherwise, provided, however, that for purposes of this Agreement, (i) Sponsor and Acquiror shall be deemed not to be Affiliates of the Company; and (ii) Affiliates of Acquiror and Affiliates of Sponsor shall be deemed to only refer to Sponsor, Acquiror and, if applicable, their respective directors and officers. The term “control” (including the terms “controlling,” “controlled by” and “under common control with”) means 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.
“AI Inputs” means any and all data, content or materials of any nature (including text, numbers, images, photos, graphics, video, audio or computer code) used to train, validate, test, improve or deploy any AI Technology.
“AI Technology” means any and all machine learning, deep learning, and other artificial intelligence (“AI”) technologies, including statistical learning algorithms, models (including large language models), neural networks and other AI tools or methodologies, all software implementations of any of the foregoing, and related hardware or equipment.
“Alternative Proposal” means, with respect to the Company and its Subsidiaries, other than the transactions contemplated hereby, (i) any acquisition or purchase by any third party, directly or indirectly, of 20% or more of any shares of any class of outstanding voting or equity securities of the Company or any of its Subsidiaries, or any tender offer (including a self-tender) or exchange offer that, if consummated, would result in any third-party beneficially owning any shares of 20% or more of any class of outstanding voting or equity securities of the Company or any of its Subsidiaries, (ii) any merger, acquisition, amalgamation, consolidation, business combination, joint venture or other similar transaction involving the Company or any of its Subsidiaries, the business of which constitutes 20% or more of the net revenues, net income or assets of the Company or any of its Subsidiaries, (iii) retaining advisors, selecting underwriters, or otherwise commencing any work in relation to an initial public offering, or resolving to make, or making, any filing or submission for an initial public offering with any stock exchange or regulator or (iv) any liquidation, dissolution, recapitalization, extraordinary dividend or other significant corporate reorganization of the Company or any of its Subsidiaries, the business of which constitutes 20% or more of the net revenues, net income or assets of the Company or any of its Subsidiaries.
“Anti-Bribery Laws” means the anti-bribery and accounting provisions of the Foreign Corrupt Practices Act of 1977, as amended, and all other applicable anti-corruption and bribery Laws.
“Anti-Money Laundering Laws” means, the applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions in which the Company or any of its Subsidiaries operates, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any relevant Governmental Authority.
“Binance Warrantholder” means Alphanest Holdings Ltd, a company organized and existing under the laws of the United Arab Emirates, its successors or permitted assigns.
5
“Binance Company Warrant” means the warrant issued on or around the date hereof by the Company to Binance Warrantholder (as may be amended, restated, supplemented and modified from time to time).
“Business Combination” has the meaning set forth in Article 2.1 of the Acquiror Charter as in effect on the date hereof.
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York and Hong Kong or Governmental Authorities in the Cayman Islands and Gibraltar are authorized or required by Law to close.
“Cayman Registrar” means the Registrar of Companies of the Cayman Islands.
“CCM” means Cohen & Company Capital Markets, a division of Cohen & Company Securities, LLC.
“CCM Agreement” means the letter agreement, dated November 21, 2025, by and between the Company and CCM.
“Company AI” means all AI Technology currently or previously used by the Company, including all such AI Technology incorporated or employed in or used in the development of the Company Products, including any usage of Generative AI Tools to assist in the development of source code for Software within the Company Products, the development or use of proprietary AI Technology, and the development or use of AI Inputs to train, validate, test, improve or deploy any third party AI.
“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Company Benefit Plan” means an “employee benefit plan” as defined in Section 3(3) of ERISA or any similar plan subject to laws of a jurisdiction outside of the United States (whether or not subject to ERISA), or any other plan, policy, program, practice, or agreement (including any employment, bonus, incentive or deferred compensation, or employee loan, note or pledge agreement, and any equity or equity-based compensation, profit-sharing, severance, retention, retirement, supplemental retirement, pension scheme, disability, death benefit, fringe benefit, insurance, change in control or similar plan, policy, program, practice or agreement) providing compensation or other benefits to any current or former (solely to the extent of any ongoing liability) director, officer, individual consultant, worker or employee, or other individual service provider, which are maintained, sponsored or contributed to by the Company, or to which the Company or any of the Company’s Subsidiaries is a party or has or would reasonably be expected to have any liability, and in each case whether or not (i) subject to the Laws of the United States, (ii) in writing or (iii) funded, but excluding in each case any statutory plan, program, practice or arrangement that is required under applicable law and maintained by any Governmental Authority.
“Company Board” means the board of directors of the Company.
“Company Charter” means, the amended and reinstated memorandum and articles of association of the Company as may be amended from time to time.
“Company Data” means all data contained in the Systems or any databases of the Company or any of its Subsidiaries (including any and all Trade Secrets) and all other information and compilations used by or held for use by the Company.
“Company Exchanging Share” means each Company Share issued and outstanding immediately prior to the Acquisition Merger Effective Time, but excluding any Company Shares referred to in Section 3.1(b)(v) and any Dissenting Company Shares (if any).
“Company Founder” means Mr. Vincent Chok.
6
“Company Fundamental Representations” means the representations and warranties made pursuant to Section 4.1 (Company Organization), Section 4.2 (Subsidiaries), Section 4.3 (Due Authorization), Section 4.4(a) (No Conflict), Section 4.6 (Capitalization of the Company), the final sentence of Section 4.9 (Undisclosed Liabilities), and Section 4.28 (Brokers’ Fees).
“Company Intellectual Property” means the Company Owned IP and the Company Licensed IP.
“Company Licensed IP” means Intellectual Property owned by Persons other than (i) the Company or (ii) one of its Subsidiaries and which is licensed (or purported to be licensed) by the Company or any of its Subsidiaries.
“Company Material Adverse Effect” means any event, state of facts, development, circumstance, occurrence or effect (collectively, “Events”) that (i) has had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the business, assets and liabilities, results of operations, prospects or financial condition of the Company and its Subsidiaries, taken as a whole or (ii) does or would reasonably be expected to, individually or in the aggregate, prevent or materially adversely affect the ability of the Company to consummate the Transactions; provided that in no event would any of the following, alone or in combination, be deemed to constitute, or be taken into account in determining whether there has been or will be, an Event under clause (i) of the definition of a “Company Material Adverse Effect”: (a) any change in applicable Laws or the accounting principles applicable to the Company, or any interpretation thereof following the date of this Agreement, (b) any change in interest rates or economic, political, business or financial market conditions generally, (c) the taking of any action required to be taken under this Agreement, (d) any natural disaster (including hurricanes, storms, tornados, flooding, earthquakes, volcanic eruptions or similar occurrences), cyberattacks, epidemic or pandemic, acts of nature or change in climate, (e) any acts of terrorism or war, the outbreak or escalation of hostilities, geopolitical conditions, local, national or international political conditions, (f) any failure in and of itself of the Company to meet any projections or forecasts (provided that the exception in this clause (f) shall not prevent or otherwise affect a determination that any Event underlying such failure has resulted in or contributed to a Company Material Adverse Effect except where such Event is otherwise excluded under any of clauses (a) through (e) or clauses (g) through (h) of this definition), (g) any Events generally applicable to the industries or markets in which the Company and its Subsidiaries operate, (h) any action taken by, or at the request of, Acquiror; (i) the announcement of this Agreement and consummation of the Transactions, including any termination of, reduction in or similar adverse impact (but in each case only to the extent attributable to such announcement or consummation) on the Company’s and its Subsidiaries’ relationships, contractual or otherwise, with third parties (other than such impact on licenses with Governmental Authorities, which impact shall not be excluded) or (j) any matter set forth on the Company Disclosure Letter which is stated therein as constituting a Company Material Adverse Effect (disregarding this clause (j)); provided, further, that in the case of each of clauses (a), (b), (d), (e) and (g), any such Event to the extent such Event disproportionately and adversely affects the business, assets, liabilities, results of operations or condition of the Company and its Subsidiaries, taken as a whole, relative to other similarly situated participants in the industries in which such Persons operate shall not be excluded from and shall be taken into account in the determination of whether there has been, or would reasonably be expected to be, a Company Material Adverse Effect, but only to the extent of the incremental disproportionate effect on the Company and its Subsidiaries, taken as a whole, relative to such similarly situated participants.
“Company Ordinary Shares” means the ordinary shares, par value $0.01, of the Company.
“Company Owned IP” means all Intellectual Property in which the Company or one of its Subsidiaries has (or purports to have) an ownership interest.
“Company Preference Shares” means the preference shares, par value $0.001, of the Company.
“Company Products” means each of the products, services, and Software that have been or are currently being developed, marketed, distributed, licensed, sold, offered, or provided by or on behalf of the Company or any of its Subsidiaries, including any products and services (i) made available through or part of a Company Website or (ii) derived from or incorporating any Company Data.
7
“Company Related Party” means any (a) member, shareholder or equity interest holder who, together with its Affiliates, directly or indirectly holds, or holds to right to acquire no less than 5% of the total outstanding share capital of the Company or any of its Subsidiaries, or (b) any director or officer of the Company or any of its Subsidiaries or any immediate family member of the foregoing Persons, in the case of clauses (a) and (b), excluding the Company and any of its Subsidiaries.
“Company Shares” means the Company Ordinary Shares and the Company Preference Shares.
“Company Shareholder” means any holder of any Company Shares
“Company Transaction Expenses” means any and all documented out-of-pocket fees and expenses paid or payable by the Company or any of its Subsidiaries or Affiliates (whether or not billed or accrued for) as a result of or in connection with the negotiation, documentation and consummation of the Transactions, including (a) all fees, costs, expenses, brokerage fees, commissions, finders’ fees and disbursements of financial advisors, investment banks, data room administrators, attorneys, accountants and other advisors and service providers, including consultants and public relations firms, and (b) any and all filing fees payable by the Company or any of its Subsidiaries or Affiliates to Governmental Authorities in connection with the Transactions, but in each case excluding any fees or expenses payable in the form of Equity Securities of the Company, PubCo or other Persons.
“Company Valuation” means $250 million, subject to adjustment as contemplated by Section 8.1.
“Company Website” means any public or private website or application owned, controlled, maintained or operated at any time by or on behalf of the Company or one of its Subsidiaries.
“Confidentiality Agreement” means Non-Disclosure and Confidentiality Agreement, dated December 9, 2025, by and between the Acquiror and the Company.
“Contracts” means any legally binding (whether written or verbal) contracts, deeds, agreements, subcontracts, leases, licenses, sublicenses, insurance policies, purchase orders or undertakings of any nature that have any outstanding rights or obligations.
“COTS Technology” means any non-customized Intellectual Property, Software, or other technology (including Software provided as a software-as-a-service offering) that is available to any purchaser or licensee upon acceptance of a publisher’s, manufacturer’s, distributor’s, service provider’s, distributor’s or reseller’s standard contract, license, terms of use, terms of service, or similar contractual provisions for the applicable Intellectual Property, Software, or other technology on a non-exclusive basis for a cost of less than $25,000 in the aggregate or less than $25,000 per year for the applicable items of Intellectual Property, Software, or other technology.
“Disclosure Letter” means, as applicable, the Company Disclosure Letter or the Acquiror Disclosure Letter.
“DTC” means Depository Trust Company.
“Environmental Laws” means any and all applicable Laws relating to Hazardous Materials, pollution, or the protection or management of the environment or natural resources, or protection of human health (with respect to exposure to Hazardous Materials).
“Equity Securities” means, with respect to any Person, any capital stock, share, equity interests, membership interests, partnership interests or registered capital, joint venture or other ownership interests in such Person and any options, warrants or other securities (for the avoidance of doubt, including debt securities) that are directly or indirectly convertible into, or exercisable or exchangeable for, such capital stock, share, equity interests, membership interests, partnership interests or registered capital, joint venture or other ownership interests (whether or not such derivative securities are issued by such Person).
8
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
“Exchange Ratio” means a ratio equal to the quotient of (i) Company Valuation divided by the Acquiror Redemption Price, divided by (ii) (A) the total number of Company Shares issued and outstanding immediately prior to the Acquisition Merger Effective Time plus (B) without duplication of clause (A), the aggregate number of shares of Company Shares that will be issued upon full exercise of the Binance Company Warrant and the Noble Elite Company Warrant, which is 12,821,050 Company Preference Shares for this prong (B) as of the date hereof (in each case of (A) and (B), other than any securities of the Company issued or issuable pursuant to any Transaction Financing, if any).
“FDG Token” means a token that confers the holder thereof an option exercisable into Company Preference Share, to be transferred by Nemi to such holder, at an exercise ratio of 1:1 (one token to one Company Preference Share), in accordance with the Terms & Conditions of FDG Tokens.
“Forfeited Sponsor PubCo Shares” means (i) the 3,783,334 Sponsor PubCo Shares forfeited or held in escrow pursuant to Section 8.11 and (ii) the 250,000 Sponsor PubCo Shares surrendered pursuant to Section 9.13(a).
“Founder Earn-Out Shares” means all of the PubCo Class B Ordinary Shares issuable to the Company Founder as contemplated by Schedule 1 (Earn-out Summary) and the Founder Earn-Out Agreement assuming the achievement of all milestones set forth in Schedule 1 (Earn-out Summary), i.e. 20% of the Post-Closing Share Count.
“Founder Shares” means 7,666,667 Class B ordinary shares of Acquiror initially purchased by the Sponsor in connection with the IPO, of which as of the date hereof 7,566,667 Class B ordinary shares are held by the Sponsor.
“Founder Transaction Bonus Shares” means 5,000,000 PubCo Class B Ordinary Shares to be issued to the Company Founder at the Acquisition Merger Effective Time pursuant to Section 3.1(b)(vii).
“GAAP” means generally accepted accounting principles in the United States as in effect from time to time.
“Generative AI Tools” means AI Technology capable of generating various types of content (including text, images, video, audio, or computer code) based on user-supplied prompts.
“Governing Documents” means the legal document(s) by which any Person (other than an individual) establishes its legal existence, or which govern(s) its internal affairs. For example, the “Governing Documents” of a corporation are its certificate of incorporation and bylaws, the “Governing Documents” of a limited partnership are its limited partnership agreement and certificate of limited partnership, the “Governing Documents” of a Cayman Islands exempted company limited by shares are its memorandum of association and articles of association, and the “Governing Documents” of a Gibraltar private company limited by shares are its memorandum of association and articles of association.
“Government Official” means any officer, cadre, civil servant, employee or any other person acting in an official capacity for any Governmental Authority (including any political party or official thereof), any candidate for political office, or any employee of a government owned or controlled entity.
“Governmental Authority” means any federal, national, state, provincial, municipal, local or foreign government, governmental authority, taxing, regulatory or administrative agency, governmental commission, department, board, bureau, agency or instrumentality, court or tribunal.
“Governmental Order” means any order, judgment, injunction, decree, writ, stipulation, determination or award, in each case, entered by or with any Governmental Authority.
9
“Hazardous Material” means any (i) pollutant, contaminant, chemical, (ii) industrial, solid, liquid or gaseous toxic or hazardous substance, material or waste, (iii) petroleum or any fraction or product thereof, (iv) asbestos or asbestos-containing material, (v) polychlorinated biphenyl, (vi) chlorofluorocarbons, or (vii) other substance, material or waste, in each case, which are regulated under any Environmental Law or as to which liability may be imposed pursuant to Environmental Law.
“IFRS” means the International Financial Reporting Standards issued by the International Accounting Standards Board, as in effect from time to time.
“Inbound IP Agreements” means assignments, licenses, sublicenses, consent to use agreements, settlements, coexistence agreements, covenants not to sue or assert, permissions and other Contracts (including any right to receive or obligation to pay royalties or any other consideration) to which the Company or one of its Subsidiaries is a party, beneficiary or otherwise bound, in each case concerning any Intellectual Property owned by a third Person, and including any such Contracts pursuant to which the Company or one of its Subsidiaries is granted rights (including rights of refusal and option rights) in Intellectual Property owned by a third Person; provided that this definition excludes all Contracts that pertain to Open Source Software or COTS Technology.
“Indebtedness” means with respect to any Person, without duplication, any obligations, contingent or otherwise, in respect of (a) the principal of and premium (if any) in respect of all indebtedness for borrowed money, including accrued interest and any per diem interest accruals, (b) the principal and interest components of capitalized lease obligations under IFRS, (c) amounts drawn (including any accrued and unpaid interest) on letters of credit, bank guarantees, bankers’ acceptances and other similar instruments (solely to the extent such amounts have actually been drawn), (d) the principal of and premium (if any) in respect of obligations evidenced by bonds, debentures, notes and similar instruments, (e) the termination value of interest rate protection agreements and currency obligation swaps, hedges or similar arrangements (without duplication of other indebtedness supported or guaranteed thereby), (f) the principal component of all obligations to pay the deferred and unpaid purchase price of property and equipment which have been delivered, including “earn outs” and “seller notes,” (g) any unfunded or underfunded liabilities pursuant to any pension, retirement, or nonqualified deferred compensation plan or arrangement and any earned but unpaid compensation (including salary, bonuses and paid time off) for any period prior to the Acquisition Merger Closing Date), and (h) breakage costs, prepayment or early termination premiums, penalties, or other fees or expenses payable as a result of the consummation of the transactions contemplated hereby in respect of any of the items in the foregoing clauses (a) through (g), and (i) all Indebtedness of another Person referred to in clauses (a) through (h) above guaranteed or for which the Company or any of its Subsidiaries has given assurance, comfort, keep-well or any similar undertaking, directly or indirectly, jointly or severally.
“Intellectual Property Agreements” means all Inbound IP Agreements and Outbound IP Agreements.
“Intellectual Property Registrations” means all Company Owned IP that is subject to any issuance, registration, application or other filing by, to or with any Governmental Authority or authorized private registrar in any jurisdiction, including registered trademarks, domain names and copyrights, issued and reissued patents and pending applications for any of the foregoing.
“Intellectual Property” means all rights, title, and interest in and to any of the following throughout the world to the extent recognized by applicable Law: (a) issued patents and patent applications (including divisionals, continuations, continuations-in-part, extensions, reexaminations, reissues, revisions, designations, validations, extensions and counterparts thereof), patent disclosures, inventions and invention disclosures (whether or not patentable or reduced to practice); (b) trademarks, service marks, trade dress, trade and business names, corporate names, logos, slogans and other source identifiers (and all derivatives, translations, transliterations, and combinations of the foregoing) and Internet domain names and social media handles, together with all goodwill associated with each of the foregoing, and all applications, registrations, and renewals in connection therewith, together with all designations, validations, extensions, and counterparts thereof; (c) copyrights and copyrightable works, including all works of authorship, and all derivatives, translations, adaptations, and combinations of the foregoing, and all applications, registrations, and renewals in connection therewith, together with all designations, validations, extensions, and counterparts therefore, and all related moral and economic rights; (d) Trade Secrets; (e) Software; (f) all rights of privacy and rights of publicity, including the right to use the name, voice, likeness, signature and biographies of real persons, together with all goodwill related thereto; (g) all other intellectual, proprietary or industrial rights; and (h) all registrations and applications for any of the foregoing.
10
“International Trade Laws” means all export, import, customs, anti-boycott, and other trade Laws or programs administered, enacted or enforced by any relevant Governmental Authority, including but not limited to: (a) the U.S. Export Administration Regulations, the U.S. International Traffic in Arms Regulations, and the import Laws and regulations administered by U.S. Customs and Border Protection; (b) the anti-boycott Laws administered by the U.S. Departments of Commerce and Treasury; and (c) any other similar export, import, customs, anti-boycott, or other trade Laws or programs in any relevant jurisdiction to the extent they are applicable to the Company or any of its Subsidiaries.
“Investment Company Act” means the Investment Company Act of 1940, as amended.
“IRS” means the U.S. Internal Revenue Service.
“JOBS Act” means the Jumpstart Our Business Startups Act of 2012, as amended.
“Law” means any statute, law, ordinance, rule, regulation or Governmental Order, in each case, of any Governmental Authority, or any provisions or interpretations of the foregoing by the competent Governmental Authorities, including general principles of common and civil law and equity.
“Leased Real Property” means all real property leased, licensed, subleased or otherwise used or occupied by the Company or any of its Subsidiaries.
“Licenses” means any approvals, authorizations, consents, licenses, registrations, permits or certificates of a Governmental Authority.
“Lien” means all liens, mortgages, deeds of trust, pledges, hypothecations, encumbrances, security interests, adverse claim, options, rights of preemption, leases, subleases, licenses, restrictions, claims or other liens of any kind whether consensual, statutory or otherwise, and whether filed, recorded or perfected under applicable Law (including any restriction on the receipt of any income derived from any asset, any restriction on the use of any asset and any restriction on the possession, exercise or transfer of any other attribute of ownership of any asset, but in any event excluding transfer restrictions under applicable securities Laws).
“Nemi” means Nemi Limited, a company incorporated under the Laws of Marshall Islands.
“Noble Elite Company Warrant” means the warrant issued on or around the date hereof by the Company to Noble Elite (as may be amended, restated, supplemented and modified from time to time).
“Noble Elite” means Noble Elite Ltd., an exempted company organized and existing under the laws of the Cayman Islands, its successors or permitted assigns.
“Open Source Software” means any (a) Software licensed or distributed as free Software, open source Software (e.g., Linux) or under similar licensing or distribution models, (b) Software that may require as a condition of use, modification or distribution that such Software or other Software incorporated into, derived from or distributed with such Software: (i) be disclosed or distributed in source code form, (ii) be licensed for the purpose of making derivative works or (iii) be redistributable at no charge, and/or (c) Software licensed or distributed under any of the following licenses or distribution models, or licenses or distribution models similar to any of the following: GNU’s General Public License (GPL) or Lesser/Library GPL (LGPL), Common Public License, the Artistic License (e.g., PERL), BSD, MIT, the Mozilla Public License, the Netscape Public License, the Sun Community Source License (SCSL), the Sun Industry Source License (SISL) and the Apache Software License, or any license approved by or designated as open source by the Open-Source Initiative or that meets the Free Software definition as promulgated by the Free Software Foundation.
“Outbound IP Agreements” means assignments, licenses, sublicenses, consent to use agreements, settlements, coexistence agreements, covenants not to sue or assert, permissions and other Contracts (including any right to receive or obligation to pay royalties or any other consideration) to which the Company or any of its Subsidiaries is a party, beneficiary or otherwise bound, in each case concerning (i) any Company Owned IP or (ii) any Company Licensed IP that is exclusively licensed to the Company or one of its Subsidiaries, and including any such Contracts pursuant to which any third party is granted rights (including rights of refusal and option rights) in any Company Owned IP or any Company Licensed IP that is exclusively licensed to the Company or one of its Subsidiaries.
11
“PCAOB” means the U.S. Public Company Accounting Oversight Board.
“Permitted Liens” means (i) mechanic’s, materialmen’s and similar Liens arising in the ordinary course of business with respect to any amounts (A) not yet due and payable or which are being contested in good faith through appropriate proceedings and (B) for which adequate accruals or reserves have been established in accordance with IFRS, (ii) Liens for Taxes (A) not yet due and payable or (B) which are being contested in good faith through appropriate proceedings and for which adequate accruals or reserves have been established in accordance with IFRS (with respect to the Company or any of its Subsidiaries) or GAAP (with respect to Acquiror), (iii) defects or imperfections of title, easements, encroachments, covenants, rights-of-way, conditions, matters that would be apparent from a physical inspection or current, accurate survey of such real property, restrictions and other similar charges or encumbrances that do not, in the aggregate, materially impair the value or materially interfere with the use of the Leased Real Property, (iv) with respect to any Leased Real Property (A) the interests and rights of the respective lessors with respect thereto, including any statutory landlord liens and any Lien thereon, (B) any Lien permitted under a Real Property Lease, and (C) any Liens encumbering the underlying fee title of the real property of which the Leased Real Property is a part, (v) zoning, building, entitlement and other land use and environmental regulations promulgated by any Governmental Authority that do not, in the aggregate, materially interfere with the current use of, or materially impair the value of, the Leased Real Property, (vi) non-exclusive licenses of Intellectual Property entered into in the ordinary course of business consistent with past practice, (vii) ordinary course purchase money Liens and Liens securing rental payments under operating or capital lease arrangements for amounts not yet due or payable, (viii) other Liens arising in the ordinary course of business consistent with past practice with respect to the borrowing of money in connection with workers’ compensation, unemployment insurance or other types of social security, (ix) reversionary rights in favor of landlords under any Leased Real Property with respect to any of the buildings or other improvements owned by the Company or any of its Subsidiaries, and (x) other Liens incurred in the ordinary course of business consistent with past practice that do not, individually or in the aggregate, materially and adversely affect the use of the property affected by such Lien, or materially disrupt, the ordinary course operation of the businesses of the Company and its Subsidiaries, taken as a whole, or the Acquiror (as applicable).
“Person” means any individual, firm, corporation, partnership, limited liability company, incorporated or unincorporated association, joint venture, joint stock company, Governmental Authority or instrumentality or other entity of any kind.
“Personal Information” means all information (a) that relates to, describes, is capable of being associated with, or could reasonably be linked to, directly or indirectly, an identified or identifiable individual or (b) for which the receipt, collection, compilation, use, storage, processing, sharing, safeguarding, security, disclosure, transfer, destruction or disposal is governed by applicable Privacy Laws relating to information about an identified or identifiable person and governing the receipt, collection, compilation, use, storage, processing, sharing, safeguarding, security, disclosure, transfer (including cross-border transfer), destruction or disposal of such information, in each case, to the extent such information is regulated as “personal data,” “personal information,” or an equivalent term under applicable Privacy Laws.
“Plan of Acquisition Merger” means the plan of merger for the Acquisition Merger in the form and substance reasonably satisfactory to the Company and Acquiror and any amendment or variations thereto made in accordance with the provisions of the Cayman Companies Act and the terms thereof.
“Plan of Reincorporation Merger” means the plan of merger for the Reincorporation Merger in the form and substance reasonably satisfactory to the Company and Acquiror and any amendment or variation thereto made in accordance with the provisions of the Cayman Companies Act and the terms thereof.
“Post-Closing Fully Diluted Share Count” means the Post-Closing Share Count, plus (i) 1,891,667 PubCo Class A Ordinary Shares issuable under the Sponsor Warrant (i.e. the 1,891,667 PubCo Class A Ordinary Shares referenced in Section 8.11(a)(i)) and (ii) the total number of PubCo Ordinary Shares reserved for issuance under the PubCo Equity Incentive Plan pursuant to Section 9.10(a).
12
“Post-Closing Share Count” means the sum of, without duplication, the following PubCo Ordinary Shares as of immediately after the Acquisition Merger Effective Time: (i) the total number of PubCo Ordinary Shares issued or exchanged for in connection with the Reincorporation Merger and the Acquisition Merger pursuant to Section 3.1(a)(ii) (excluding the Forfeited Sponsor PubCo Shares), Section 3.1(a)(iii), Section 3.1(b)(i) and Section 3.1(b)(vii), (ii) the total number of PubCo Ordinary Shares issued to Black Spade and CCM as of immediately after the Acquisition Merger Effective Time pursuant to Section 9.13 and Section 9.14, and (iii) the total number of PubCo Ordinary Shares issuable under the Binance PubCo Warrant and the Noble Elite PubCo Warrant assuming full exercise thereof. For the avoidance of doubt, the Post-Closing Share Count does not include any Sponsor Escrow Shares or Founder Escrow Shares.
“Privacy Laws” means all Laws that govern: (a) the privacy, security, confidentiality or Processing of Personal Information, including such information insofar as it applies to employees or contractors, (b) the use or disclosure of Personal Information in connection with online marketing or advertising, or (c) the scope of purposes for which Personal Information may be Processed, in each case, to the extent applicable to the Company’s and its Subsidiaries’ Processing activities in the jurisdictions in which they operate or target individuals.
“Process” or “Processing” means any operation or set of operations which is performed on Personal Information, whether or not by automated means, such as collection, recording, organization, structuring, storage, adaptation, alteration, moderation, retrieval, consultation, use, disclosure by transmission, transfer, dissemination, safeguarding, control or otherwise making available, alignment or combination, restriction, erasure or destruction.
“PubCo Class A Ordinary Shares” means the Class A ordinary shares of PubCo, having the rights and subject to the restrictions set out in the PubCo Charter, each of which shall be entitled to one (1) vote at any shareholders’ meeting or written consent of shareholders of PubCo.
“PubCo Class B Ordinary Shares” means the Class B ordinary shares of PubCo, having the rights and subject to the restrictions set out in the PubCo Charter, each of which shall be entitled to ten (10) votes at any shareholders’ meeting or written consent of shareholders of PubCo.
“PubCo Ordinary Shares” means, the PubCo Class A Ordinary Shares and the PubCo Class B Ordinary Shares, as applicable.
“PubCo Warrants” means the warrants issuable by PubCo in exchange of Acquiror Warrants at the Reincorporation Merger Effective Time.
“Redeeming Acquiror Shares” means Acquiror Public Shares in respect of which the eligible (as determined in accordance with the Acquiror Charter) holder thereof has validly exercised (and not validly revoked, withdrawn or lost) his, her or its Acquiror Shareholder Redemption Right.
“Remaining Working Capital Amount” means the positive balance, if any, of the Working Capital Amount remaining and held as unrestricted cash by Acquiror outside the Trust Account as of immediately prior to the Acquisition Merger Effective Time, minus the sum of (i) any debt for borrowed money of Acquiror as of immediately prior to the Acquisition Merger Effective Time and (ii) all unpaid Acquiror Transaction Expenses as of immediately prior to the Acquisition Merger Effective Time.
“Remaining Working Capital Warrant Coverage” means the number of PubCo Class A Ordinary Shares equal to (x) the Remaining Working Capital Amount divided by (y) $0.50.
“Representatives” of a Person means, collectively, officers, directors, employees, accountants, consultants, legal counsel, advisors, agents and other representatives of such Person or its Affiliates.
“Requisite Company Shareholders” means Company Shareholders holding the requisite number of Company Shares sufficient to enable the Company Shareholder Approval to be obtained without the affirmative vote of any other Company Shareholder.
13
“Restricted Person” means any Person identified on the U.S. Department of Commerce’s Denied Persons List, Unverified List or Entity List or the U.S. Department of State’s Debarred List.
“Sanctioned Jurisdiction” means any country or territory subject to comprehensive Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Russia, Syria, Venezuela, and the Crimea region of Ukraine and non-government controlled areas of the Zaporizhzhia and Kherson regions of Ukraine, the so-called Donetsk People’s Republic and the so-called Luhansk People’s Republic).
“Sanctioned Person” means any Person that is (a) organized under the Laws of, or resident or located in, any Sanctioned Jurisdiction, (b) included on any list of Persons subject to Sanctions (including, but not limited to, the U.S. Department of the Treasury’s Specially Designated Nationals and Blocked Persons List and the Sectoral Sanctions Identification List; or any similar list maintained or administered by the United Nations Security Council, HM Treasury of the United Kingdom, the European Union, any European Union member states, or any other Governmental Authority where the Company or any of its Subsidiaries operates), or (c) owned fifty percent (50%) or more, directly or indirectly, controlled by, or acting on behalf or at the direction of any Person or Persons described in clauses (a) or (b).
“Sanctions” means those trade, economic and financial sanctions Laws, embargoes, and restrictive measures administered, enacted or enforced from time to time by (a) the United States (including through the U.S. Department of the Treasury’s Office of Foreign Assets Control or the Department of State), (b) the European Union or any European Union member states, (c) the United Nations Security Council, (d) His Majesty’s Treasury of the United Kingdom, or (e) any other Governmental Authority where the Company or any of its Subsidiaries operates.
“Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002, as amended.
“SEC” means the United States Securities and Exchange Commission.
“Reincorporation Merger Consideration” means all of PubCo Ordinary Shares and PubCo Warrants receivable by the shareholders of Acquiror pursuant to Section 3.1(a).
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Software” means any and all (a) computer programs and applications, architectures, libraries, firmware and middleware, including any and all software implementations of algorithms, models and methodologies, whether in source code or object code, (b) databases and compilations, including any and all data and collections of data, whether machine readable or otherwise, (c) descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing and (d) programmer and user documentation, including user manuals and training materials, relating to any of the foregoing.
“Sponsor” means CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted limited liability company.
“Sponsor PubCo Shares” means the PubCo Class A Ordinary Shares issued to the Sponsor in exchange for the Founder Shares held by the Sponsor pursuant to Section 3.1(a)(ii).
“Subsidiary” means, with respect to a Person, a corporation or other entity of which more than fifty percent (50%) of the voting power of the Equity Securities or equity interests is owned, directly or indirectly, by such Person and, in case of a limited partnership, limited liability company or similar entity, such Person is a general partner or managing member or has the power to direct the policies, management and affairs of such entity, and a Subsidiary is a “wholly-owned Subsidiary” of such Person when substantially all of the voting power of its Equity Securities or equity interests is owned or controlled by such Person.
“Surviving Company Share” means an ordinary share of the Surviving Company.
14
“Systems” means, collectively, the Software, computer hardware (whether general or special purpose), telecommunications capabilities (including all voice, data and video networks) and other similar or related equipment and items of automated, computerized or software systems and any other networks or systems and related services that are used by or relied on by the Company or any of its Subsidiaries.
“Tax” or “Taxes” means (a) any and all federal, state, local, foreign or other taxes imposed by any Governmental Authority, including all income, gross receipts, license, payroll, recapture, net worth, employment, escheat and unclaimed property obligations, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, Equity Securities, ad valorem, value added, inventory, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, governmental charges, duties, levies and other similar charges imposed by a Governmental Authority in the nature of a tax, alternative or add-on minimum, or estimated taxes, and including any interest, penalty, or addition thereto, (b) any liability for payment of amounts described in clause (a) whether as a result of being a member of an affiliated, consolidated, combined or unitary group for any period or otherwise through operation of law, and (c) any liability for the payment of amounts described in clauses (a) or (b) as a result of any tax sharing, tax group, tax indemnity or tax allocation agreement (excluding commercial agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes) with, or any other express or implied agreement to indemnify, any other person.
“Tax Return” means any return, declaration, report, form, statement, information statement or other document filed or required to be filed with any Governmental Authority with respect to Taxes, including any claims for refunds of Taxes, any information returns and any schedules, attachments, amendments or supplements of any of the foregoing.
“Technical Documentation” means all technical and descriptive materials (including all copies in whatever form, including digital or electronic copies) relating to the acquisition, design, development, use, maintenance, support and ongoing development of Software and products, including source code, annotations, know-how, system documentation, statements of principles of operation, schematics, programs, compilers, “workbenches,” tools and higher level (or “proprietary”) languages used for the development, maintenance and implementation of such Software and products, and all pertinent commentary or explanation that may be necessary to render such materials understandable and usable by a trained computer programmer.
“Third Party Data” means all data of any kind or character contained in the Company’s and any of its Subsidiaries’ computer, telecommunications and information technology systems, assets and equipment, in each case whether owned and operated by the Company or one of its Subsidiaries or any other Person for the Company’s benefit and which are used in or necessary to the operation of the Company, as well as any databases owned or controlled by the Company, and all other information and data compilations used by, or necessary to the Company’s business, that was licensed, received, or collected from any other Person.
“Trade Secrets” means trade secrets, confidential information, customer data and customer records, reports, Software and Software development methodologies, technical information, proprietary information, technology, plans, drawings, blueprints, and know-how.
“Transaction Documents” means, collectively, this Agreement, the Plan of Acquisition Merger, the Plan of Reincorporation Merger, the Company Shareholders Support Agreement, the Sponsor Support Agreement, the Registration Rights Agreement, the Lock-up Agreement, the PubCo Equity Incentive Plan, the Founder Earn-Out Agreement, the PubCo Charter, the Sponsor Share Restructuring Agreement, the Sponsor Warrant, the Binance Company Warrant, the Binance PubCo Warrant, the Noble Elite PubCo Warrant, the Escrow Agreement and any other agreements, documents or certificates entered into or delivered pursuant hereto or thereto, and the expression “Transaction Document” means any one of them.
“Transactions” means, collectively, the Re-domiciliation and Continuation, the Mergers, and each of the other transactions contemplated by this Agreement or any of the other Transaction Documents.
15
“Treasury Regulations” means the regulations promulgated under the Code by the United States Department of the Treasury (whether in final, proposed or temporary form), as the same may be amended from time to time.
“Working Capital Amount” means the proceeds held by Acquiror outside of the Trust Account for working capital and other general corporate purposes, which, as set forth in Acquiror’s Registration Statement on Form S-1 (File No. 333-288156) filed with the SEC in connection with the IPO, was approximately $2,973,324 at time of the IPO. For the avoidance of doubt, Working Capital Amount shall not include any working capital loans or other loans owed to Sponsor or any other Person by Acquiror.
Section 1.2. Construction.
(a) Unless the context of this Agreement otherwise requires, (i) words of any gender include each other gender; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) the terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words refer to this entire Agreement; (iv) the terms “Article” or “Section” refer to the specified Article or Section of this Agreement; (v) the word “including” shall mean “including, without limitation” and (vi) the word “or” shall be disjunctive but not exclusive.
(b) Unless the context of this Agreement otherwise requires, references to statutes shall include all regulations promulgated thereunder and references to statutes or regulations shall be construed as including all statutory and regulatory provisions consolidating, amending or replacing the statute or regulation.
(c) Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless Business Days are specified.
(d) All accounting terms used herein and not expressly defined herein shall have the meanings given to them under IFRS.
Section 1.3. Knowledge. As used herein, (a) the phrase “to the knowledge” of the Company shall mean the knowledge of the individuals identified on Section 1.3 of the Company Disclosure Letter, and (b) the phrase “to the knowledge” of Acquiror or an Acquisition Entity shall mean the actual knowledge of the individuals identified on Section 1.3 of the Acquiror Disclosure Letter, in each case, as such individuals would have acquired in the exercise of reasonable inquiries of direct reports.
ARTICLE II
THE MERGERS; MERGER CLOSING
Section 2.1. Pre-Closing Actions.
(a) At least one (1) Business Day prior to the Reincorporation Merger Closing Date, the Company shall complete the Re-domiciliation and Continuation by (i) redomiciling from Gibraltar to Cayman Islands and (ii) transferring by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable). For the avoidance of doubt and notwithstanding anything to the contrary contained in this Agreement, the Parties acknowledge and agree that the timing and completion of the Re-domiciliation and Continuation depend on actions of Governmental Authorities in Gibraltar and Cayman Islands and other third parties, each outside of the Company’s control, and the Company shall not be liable to any Party for any failure or delay to complete the Re-domiciliation and Continuation to the extent arising from matters outside its reasonable control.
16
Section 2.2. The Reincorporation Merger.
(a) Reincorporation Merger. On the date which is no later than five (5) Business Days after the first date on which all conditions set forth in Section 10.1, Section 10.2 and Section 10.3 shall have been satisfied or validly waived (other than those conditions that by their terms are to be satisfied at the Acquisition Merger Closing, but subject to the satisfaction or waiver thereof) and at least one (1) Business Day after the Re-domiciliation and Continuation, or at such other time or in such other manner as shall be agreed upon by Acquiror and the Company in writing, the closing of the Transactions contemplated by this Agreement with respect to the Reincorporation Merger (the “Reincorporation Merger Closing”) shall take place remotely by conference call and exchange of documents and signatures in accordance with Section 12.9. At the Reincorporation Merger Closing, Acquiror shall merge with and into PubCo, with PubCo being the surviving company in the Reincorporation Merger (the day on which the Reincorporation Merger Closing occurs, the “Reincorporation Merger Closing Date”) and Merger Sub becoming a wholly-owned Subsidiary of PubCo. On the Reincorporation Merger Closing Date, Acquiror and PubCo shall execute and cause to be filed with the Cayman Registrar, the Plan of Reincorporation Merger and such other documents as may be required in accordance with the applicable provisions of the Cayman Companies Act or by any other applicable Law to make the Reincorporation Merger effective. The Reincorporation Merger shall become effective at the time when the Plan of Reincorporation Merger is registered by the Cayman Registrar or at such later time permitted by the Cayman Companies Act as may be agreed by PubCo and Acquiror in writing and specified in the Plan of Reincorporation Merger, provided that such later time shall not be a date later than the second (2nd) Business Day after the date when the Plan of Reincorporation Merger is filed and registered with the Cayman Registrar (the “Reincorporation Merger Effective Time”).
(b) Effects of the Reincorporation Merger. At and after the Reincorporation Merger Effective Time, the Reincorporation Merger shall have the effects set forth in this Agreement, the Plan of Reincorporation Merger and the applicable provisions of the Cayman Companies Act. Without limiting the generality of the foregoing, and subject thereto, at the Reincorporation Merger Effective Time, all the property, rights, privileges, agreements, powers and franchises, liabilities and duties of Acquiror and PubCo shall vest in and become the property, rights, privileges, agreements, powers and franchises, liabilities and duties of PubCo as the Surviving Acquiror (including all rights and obligations with respect to the Trust Account), which shall include the assumption by PubCo of any and all agreements, covenants, duties and obligations of Acquiror and PubCo set forth in this Agreement and the other Transaction Documents to which Acquiror or PubCo is a party, and Merger Sub shall thereafter exist as a wholly-owned subsidiary of PubCo and the separate corporate existence of Acquiror shall cease to exist.
(c) Organizational Documents of the Surviving Acquiror. At the Reincorporation Merger Effective Time, the memorandum and articles of association of PubCo, as in effect immediately prior to the Reincorporation Merger Effective Time, shall be amended and restated and replaced in its entirety with the form of amended and restated memorandum and articles of association of PubCo attached hereto as Exhibit A (the “PubCo Charter”), until thereafter amended in accordance with the terms thereof and the Cayman Companies Act.
(d) Directors and Officers of PubCo. At the Reincorporation Merger Effective Time, the board of directors of PubCo shall consist of such members as provided in Section 9.9(a), and the officers of PubCo shall be those persons as provided in Section 9.9(b). Each director and officer of PubCo shall hold office in accordance with the Governing Documents of PubCo until they are removed or resign in accordance with the Governing Documents of PubCo or until their respective successors are duly elected or appointed and qualified.
(e) Tax Treatment of the Reincorporation Merger. For federal income tax purposes, the Reincorporation Merger is intended to qualify for the Reincorporation Intended Tax Treatment. The Acquiror hereby (i) adopts this Agreement as a “plan of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations, (ii) agree to file and retain such information with respect to the Reincorporation Merger as shall be required under Section 1.368-3 of the United States Treasury Regulations, and (iii) agree to file all Tax and other informational returns with respect to the Reincorporation Merger on a basis consistent with such characterization, unless required to do otherwise pursuant to a final determination as defined in Section 1313(a) of the Code (or pursuant to any similar provision of applicable state, local or foreign Law). Each of the Parties acknowledge and agree that each such party (a) has had the opportunity to obtain independent legal and tax advice with respect to the transactions contemplated by this Agreement and (b) is responsible for paying its own Taxes, including any adverse Tax consequences that may result if the Reincorporation Merger is determined not to qualify for the Reincorporation Merger Intended Tax Treatment.
17
Section 2.3. The Acquisition Merger.
(a) Acquisition Merger. At least one (1) Business Day after the Reincorporation Merger and the Re-domiciliation and Continuation (subject to the completion of the Reincorporation Merger and the Re-domiciliation and Continuation having occurred) but in any event within three (3) Business Days after the Reincorporation Merger Effective Time, or at such other time or in such other manner as shall be agreed upon by Acquiror and the Company in writing, the closing of the Transactions contemplated by this Agreement with respect to the Acquisition Merger (the “Acquisition Merger Closing”) shall take place remotely by conference call and exchange of documents and signatures in accordance with Section 12.9. At the Acquisition Merger Closing, Merger Sub shall merge with and into the Company, with the Company being the surviving company of the Acquisition Merger (the day on which the Acquisition Merger Closing occurs, the “Acquisition Merger Closing Date”). On the Acquisition Merger Closing Date, upon the Acquisition Merger Closing, PubCo, the Company and Merger Sub shall execute and cause to be filed with the Cayman Registrar the Plan of Acquisition Merger and such other documents as may be required in accordance with the applicable provisions of the Cayman Companies Act or by any other applicable Law to make the Acquisition Merger effective. The Acquisition Merger shall become effective at the time when the Plan of Acquisition Merger is registered by the Cayman Registrar or at such later time permitted by the Cayman Companies Act as may be agreed by PubCo and the Company in writing and specified in the Plan of Acquisition Merger, provided that such later time shall not be a date later than the second (2nd) Business Day after the date when the Plan of Acquisition Merger is filed and registered with the Cayman Registrar (the “Acquisition Merger Effective Time”).
(b) Notice to Company Shareholders Delivering Written Objection. If any Company Shareholder gives to the Company, before the Company Shareholder Approval is obtained at the Company Shareholders’ Meeting, written objection to the Acquisition Merger (each, a “Company Written Objection”) in accordance with Section 238(2) of the Cayman Companies Act, the Company shall, in accordance with Section 238(4) of the Cayman Companies Act, within twenty (20) days immediately following the date on which the Company Shareholder Approval is obtained, promptly give written notice of the authorization of the Acquisition Merger to each such Company Shareholder who has made a Company Written Objection.
(c) Effect of the Acquisition Merger. At and after the Acquisition Merger Effective Time, the Acquisition Merger shall have the effects set forth in this Agreement, the Plan of Acquisition Merger and the applicable provisions of the Cayman Companies Act. Without limiting the generality of the foregoing, and subject thereto, at the Acquisition Merger Effective Time, all the property, rights, privileges, agreements, powers and franchises, liabilities and duties of the Company and Merger Sub shall vest in and become the property, rights, privileges, agreements, powers and franchises, liabilities and duties of the Company as the Surviving Company, which shall include the assumption by the Company of any and all agreements, covenants, duties and obligations of the Company and Merger Sub set forth in this Agreement and the other Transaction Documents to which the Company or Merger Sub is a party, and the Company shall thereafter exist as a wholly-owned subsidiary of PubCo and the separate corporate existence of Merger Sub shall cease to exist.
(d) Organizational Documents of the Surviving Company. At the Acquisition Merger Effective Time, the Company Charter, as in effect immediately prior to the Acquisition Merger Effective Time, shall be amended and restated and replaced in its entirety in the form and substance reasonably satisfactory to the Company and Acquiror (the “Articles of the Surviving Company”), and, as so amended and restated, shall be the memorandum and articles of association of the Surviving Company, until thereafter amended in accordance with the terms thereof and the Cayman Companies Act.
(e) Directors and Officers of the Surviving Company. At the Acquisition Merger Effective Time, the sole director of Merger Sub shall cease to hold office, and the board of directors and officers of the Surviving Company shall consist of the board of the directors and officers of the Company immediately prior to the Acquisition Merger Effective Time. Each director and officer of the Surviving Company shall hold office in accordance with the Governing Documents of the Surviving Company until they are removed or resign in accordance with the Governing Documents of the Surviving Company or until their respective successors are duly elected or appointed and qualified.
18
(f) Tax Treatment of the Acquisition Merger. For federal income tax purposes, the Acquisition Merger is intended to qualify for the Acquisition Merger Intended Tax Treatment. The Parties hereby (i) adopt this Agreement as a “plan of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations, (ii) agree to file and retain such information with respect to the Acquisition Merger as shall be required under Section 1.368-3 of the United States Treasury Regulations, and (iii) agree to file all Tax and other informational returns with respect to the Acquisition Merger on a basis consistent with such characterization, unless required to do otherwise pursuant to a final determination as defined in Section 1313(a) of the Code (or pursuant to any similar provision of applicable state, local or foreign Law). Each of the Parties acknowledge and agree that each such party (a) has had the opportunity to obtain independent legal and tax advice with respect to the transactions contemplated by this Agreement and (b) is responsible for paying its own Taxes, including any adverse Tax consequences that may result if the Acquisition Merger is determined not to qualify for the Acquisition Merger.
ARTICLE III
EFFECTS OF THE MERGERS ON COMPANY AND ACQUIROR EQUITY SECURITIES
Section 3.1. Conversion of Acquiror and Company Securities.
(a) At the Reincorporation Merger Effective Time, by virtue of and as part of the agreed consideration for the Reincorporation Merger and without any action on the part of any holder of securities of Acquiror or holder of securities of PubCo:
(i) Acquiror Units. Each Acquiror Unit issued and outstanding immediately prior to the Reincorporation Merger Effective Time shall be automatically detached and the holder thereof shall be deemed to hold one Acquiror Class A Ordinary Share and one-half of an Acquiror Warrant in accordance with the terms of the applicable Acquiror Unit (the “Unit Separation”); provided that no fractional Acquiror Warrants will be issued in connection with the Unit Separation such that if a holder of Acquiror Units would be entitled to receive a fractional Acquiror Warrant upon the Unit Separation, the number of Acquiror Warrants to be issued to such holder upon the Unit Separation shall be rounded down to the nearest whole number of Acquiror Warrants. The underlying Acquiror Class A Ordinary Shares and the Acquiror Warrants held or deemed to be held following the Unit Separation shall be converted in accordance with the applicable terms of this Section 3.1(a).
(ii) Acquiror Class B Ordinary Shares. Subject to Section 8.11, each Acquiror Class B Ordinary Share (i.e. each Founder Share) issued and outstanding immediately prior to the Reincorporation Merger Effective Time shall automatically be cancelled and cease to exist in exchange for one newly issued PubCo Class A Ordinary Share. As of the Reincorporation Merger Effective Time, each holder of Acquiror Class B Ordinary Shares shall cease to have any other rights in and to such Acquiror Class B Ordinary Shares, except as expressly provided herein.
(iii) Acquiror Class A Ordinary Shares. Immediately following the Unit Separation in accordance with Section 3.1(a)(i), each Acquiror Class A Ordinary Share (which, for the avoidance of doubt, includes the Acquiror Class A Ordinary Shares held as a result of the Unit Separation) issued and outstanding immediately prior to the Reincorporation Merger Effective Time (other than (1) any Acquiror Ordinary Shares referred to in Section 3.1(a)(v) and (2) Redeeming Acquiror Shares) shall automatically be cancelled and cease to exist in exchange for one newly issued PubCo Class A Ordinary Share. As of the Reincorporation Merger Effective Time, each Acquiror Shareholder shall cease to have any other rights in and to such Acquiror Class A Ordinary Shares, except as expressly provided herein.
(iv) Exchange of Acquiror Warrants. Each Acquiror Warrant (which, for the avoidance of doubt, includes the Acquiror Warrants held as a result of the Unit Separation) outstanding immediately prior to the Reincorporation Merger Effective Time shall cease to be a warrant with respect to Acquiror Class A Ordinary Shares and be automatically converted into a warrant to purchase one PubCo Class A Ordinary Share (each, a “PubCo Warrant”). Each PubCo Warrant shall continue to have and be subject to the same terms and conditions as were applicable to such Acquiror Warrant immediately prior to the Reincorporation Merger Effective Time (including any repurchase rights and cashless exercise provisions).
19
(v) Acquiror Treasury Shares. Notwithstanding Section 3.1(a)(ii) above or any other provision of this Agreement to the contrary, if there are any Acquiror Ordinary Shares that are held by Acquiror as treasury shares or any Acquiror Ordinary Shares held by any direct or indirect Subsidiary of Acquiror immediately prior to the Reincorporation Merger Effective Time, such Acquiror Ordinary Shares shall automatically be cancelled and shall cease to exist without any conversion thereof or payment or other consideration therefor.
(vi) Redeeming Acquiror Shares. Each Redeeming Acquiror Share issued and outstanding immediately prior to the Reincorporation Merger Effective Time shall automatically be cancelled and cease to exist and shall thereafter represent only the right to be paid Acquiror Redemption Price per share in accordance with the Acquiror Charter.
(vii) Shares of PubCo. The share(s) of PubCo issued and outstanding immediately prior to the Reincorporation Merger Effective Time shall automatically be cancelled and shall cease to exist without any conversion thereof or payment or other consideration therefor.
(b) At the Acquisition Merger Effective Time, by virtue of and as the agreed consideration for the Acquisition Merger and without any action on the part of any holder of Company Shares or securities of the Company or Merger Sub:
(i) Company Exchanging Shares. (x) Each Company Exchanging Share that is held by the Company Founder shall automatically be cancelled and cease to exist in exchange for such number or fraction of a newly issued PubCo Class B Ordinary Share that is equal to the Exchange Ratio, without interest, subject to rounding pursuant to Section 3.1(c); and (y) each Company Exchanging Share (other than the Dissenting Company Shares) that is held by any Person (other than the Company Founder) shall automatically be cancelled and cease to exist in exchange for such number or fraction of a newly issued PubCo Class A Ordinary Share that is equal to the Exchange Ratio, without interest, subject to rounding pursuant to Section 3.1(c). As of the Acquisition Merger Effective Time, each holder of a Company Exchanging Share shall cease to have any other rights in and to the securities of Company or the Surviving Company, except as expressly provided herein.
(ii) FDG Tokens. Each FDG Token that is outstanding and vested and not converted into Company Preference Shares prior to the Acquisition Merger Effective Time shall automatically be cancelled and cease to exist in exchange for the right to receive from Nemi the fraction or number of PubCo Class A Ordinary Share(s) that one Company Preference Share was exchanged for at the Acquisition Merger Effective Time, to be transferred by Nemi to the holder of such FDG Token (subject to any transfer restrictions applicable to Nemi under applicable Laws), subject to the relevant terms and conditions applicable to such exercise. Each FDG Token that is not vested prior to the Acquisition Merger Effective Time shall automatically be cancelled and cease to exist without any conversion thereof or payment or other consideration therefor, provided that the board of directors of the PubCo, in its sole discretion, may decide to re-grant options or other equity awards under the PubCo Equity Incentive Plan to the holders of such unvested FDG Tokens after the Acquisition Merger Effective Time. For the avoidance of doubt, any Company Preference Shares corresponding to any unexercised FDG Token are held by Nemi and will be exchanged for PubCo Class A Ordinary Share(s) at the Acquisition Merger Effective Time pursuant to Section 3.1(b)(i) and continue to be held by Nemi in trust for the original holders of the unexercised FDG Tokens after the Acquisition Merger Effective Time until Nemi transfers such PubCo Class A Ordinary Share(s) to the original holders of the unexercised FDG Tokens in accordance with the Terms & Conditions of FDG Tokens or as otherwise determined by the board of directors of the PubCo (subject to any transfer restrictions applicable to Nemi under applicable Laws).
(iii) Exchange of the Binance Company Warrant. The Binance Company Warrant shall automatically be terminated and expire in exchange for a warrant issued by PubCo, and PubCo shall issue such warrant, to the Binance Warrantholder in the form attached hereto as Exhibit H (the “Binance PubCo Warrant”) that entitles the Binance Warrantholder to subscribe for a number of PubCo Class A Ordinary Shares equal to the number of the unsubscribed FDG Warrant Shares (as defined in the Binance PubCo Warrant) multiplied by the Exchange Ratio, during the exercise period at the exercise price and subject to the exercise conditions as set out in the Binance PubCo Warrant, and on the terms set out in the Binance PubCo Warrant.
20
(iv) Exchange of the Noble Elite Company Warrant. The Noble Elite Company Warrant shall automatically be terminated and expire in exchange for a warrant issued by PubCo, and PubCo shall issue such warrant, to Noble Elite in the form attached hereto as Exhibit I (the “Noble Elite PubCo Warrant”) that entitles Noble Elite to subscribe for a number of PubCo Class A Ordinary Shares equal to the number of the unsubscribed FDG Warrant Shares (as defined in the Noble Elite PubCo Warrant) multiplied by the Exchange Ratio, during the exercise period at the exercise price and subject to the exercise conditions as set out in the Noble Elite PubCo Warrant, and on the terms set out in the Noble Elite PubCo Warrant.
(v) Treasury Shares. Notwithstanding Section 3.1(b)(i) above or any other provision of this Agreement to the contrary, if there are any Company Shares that are held by the Company as treasury shares or any Company Shares held by any direct or indirect Subsidiary of the Company immediately prior to the Acquisition Merger Effective Time, such Company Shares shall automatically be cancelled and shall cease to exist without any conversion thereof or payment or other consideration therefor.
(vi) Dissenting Company Shares. Each Dissenting Company Share issued and outstanding immediately prior to the Acquisition Merger Effective Time held by a Dissenting Company Shareholder shall automatically be cancelled and cease to exist in accordance with Section 3.4 and shall thereafter represent only the right to be paid the fair value of such Dissenting Company Shares determined in accordance with Section 238 of the Cayman Companies Act and such other rights as are granted by the Cayman Companies Act.
(vii) Founder Transaction Bonus Shares. At the Acquisition Merger Effective Time, PubCo shall issue the Founder Transaction Bonus Shares to the Company Founder. The Founder Transaction Bonus Shares shall be fully paid and non-assessable when issued.
(viii) Merger Sub Shares. Each share of capital stock of Merger Sub issued and outstanding immediately prior to the Acquisition Merger Effective Time shall automatically be converted into one validly issued, fully paid and non-assessable ordinary share of the Surviving Company, which ordinary share shall constitute the only issued and outstanding share in the capital of the Surviving Company.
(ix) Sponsor PubCo Shares. The Sponsor PubCo Shares shall be restructured in accordance with Section 8.11.
(c) Notwithstanding anything to the contrary contained herein, no fraction of a PubCo Ordinary Share will be issued by virtue of the Mergers or the other Transactions, and each Person who would otherwise be entitled to a fraction of a PubCo Ordinary Share (after aggregating all fractional PubCo Ordinary Shares that otherwise would be received by such holder) shall instead have the number of PubCo Ordinary Shares issued to such Person rounded down in the aggregate to the nearest whole PubCo Ordinary Share.
Section 3.2. Payment of Acquisition Merger Consideration.
(a) At least three (3) Business Days prior to the Acquisition Merger Closing, Acquiror shall deliver to the Company, the calculation of the Acquiror Redemption Price, prepared by the Trustee in good faith in accordance with the Trust Agreement and the Acquiror Charter. The calculation of the Acquiror Redemption Price delivered by Acquiror hereunder shall be subject to reasonable review of, and be agreed by, the Company, and shall comport with the provisions of this Agreement and the terms of the Acquiror Charter, and the Acquiror shall take into account the reasonable comments raised by the Company.
21
(b) At least three (3) Business Days prior to the Acquisition Merger Closing, the Company shall deliver to PubCo a spreadsheet (as finalized pursuant to this Section 3.2, the “Company Shareholder Spreadsheet”), prepared by the Company in good faith in accordance with this Agreement and setting forth the following, in each case, as of immediately prior to the Acquisition Merger Effective Time, based, when relevant, on assumptions reasonably acceptable to Acquiror which are described in detail in the Company Shareholder Spreadsheet (i) the name and address of record of each holder of and the number of Company Shares held by each including the Company Dissenting Shares and (ii) the allocation of Acquisition Merger Consideration payable to each Company Shareholder. The contents of the Company Shareholder Spreadsheet delivered by the Company hereunder shall be subject to reasonable review and comment by Acquiror, and shall comport with the provisions of this Agreement, but the Company shall, in all events, remain solely responsible for the contents of the Company Shareholder Spreadsheet. The Parties agree that PubCo shall be entitled to rely on the Company Shareholder Spreadsheet when issuing the Acquisition Merger Consideration.
(c) For the purpose of clarification, nothing contained in this Section 3.2 or in the Company Shareholder Spreadsheet shall be construed or deemed to: (i) modify the Company’s obligations pursuant to Section 7.1(e) to obtain Acquiror’s prior consent to the issuance of any securities; or (ii) alter or amend the definition of the Acquisition Merger Consideration.
Section 3.3. Withholding. Notwithstanding any other provision of this Agreement, each of Acquiror, PubCo and the Company, as applicable, shall be entitled to deduct and withhold from any amount payable pursuant to this Agreement such Taxes as may be required to be deducted and withheld from such amounts under the Code, Treasury Regulations, or any other applicable Tax Law (as reasonably determined by Acquiror, PubCo, or the Company, respectively). To the extent that any amounts are so deducted and withheld, such deducted and withheld amounts shall be (a) timely remitted to the appropriate Governmental Authority and (b) treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made. The applicable payor intending to so deduct and withhold an amount pursuant to this Section 3.3 shall (1) notify the Person in respect of which such deduction and withholding is intended to be made that the applicable payor intends to deduct and withhold and provide such Person a description of the applicable provisions of Law pursuant to which such deduction and withholding is required, and (2) provide reasonable opportunity for such Person to provide any applicable forms or other documentary evidence that would have the effect of reducing or eliminating such withholding or deduction.
Section 3.4. Dissenting Shares.
(a) Notwithstanding any provision of this Agreement to the contrary and to the extent available under the Cayman Companies Act, Company Shares that are issued and outstanding immediately prior to the Acquisition Merger Effective Time and that are held by Company Shareholders who shall have validly exercised their dissenters’ rights for such Company Shares in accordance with Section 238 of the Cayman Companies Act and otherwise complied with all of the provisions of the Cayman Companies Act relevant to the exercise and perfection of dissenters’ rights (the “Dissenting Company Shares,” and the holders of such Dissenting Company Shares being the “Dissenting Company Shareholders”) shall not be converted into, and such Dissenting Company Shareholders shall have no right to receive, the applicable Acquisition Merger Consideration unless and until such Dissenting Company Shareholder fails to perfect or withdraws or otherwise loses his, her or its right to dissenters’ rights under the Cayman Companies Act. The Company Shares owned by any Company Shareholder who fails to perfect or who effectively withdraws or otherwise loses his, her or its dissenters’ rights pursuant to the Cayman Companies Act shall cease to be Dissenting Company Shares and shall thereupon be deemed to have been converted into, and to have become exchangeable for, as of the Acquisition Merger Effective Time, the applicable Acquisition Merger Consideration, without any interest thereon in accordance with Section 3.1(b)(i).
(b) Prior to the Acquisition Merger Closing, the Company shall give Acquiror prompt written notice of any demands for dissenters’ rights made in accordance with the Cayman Companies Act and received by the Company from Company Shareholders, and any withdrawals of such demands and the Company shall have complete control over its negotiations and proceedings with respect to such dissenters’ rights of its shareholders, except that the Company shall not make or commit or agree to make any payment with respect to any exercise by its shareholders of its rights to dissent from the Acquisition Merger or commit or agree to settle or compromise any demands for appraisal, without the prior written consent of the Acquiror (which consent shall not to be unreasonably withheld or delayed).
22
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except (a) as set forth in the disclosure letter delivered to Acquiror by the Company on the date of this Agreement (the “Company Disclosure Letter”) which may be supplemented from time to time by the Company prior to the Acquisition Merger Closing (each section of which, subject to Section 12.10, qualifies the correspondingly numbered and lettered representations and warranties in this Article IV), and (b) as otherwise explicitly contemplated by this Agreement, the other Transaction Documents or in connection with the Transactions, the Company represents and warrants to Acquiror as of the date hereof, as of the Reincorporation Merger and as of the Acquisition Merger Closing as follows:
Section 4.1. Company Organization. The Company has been duly incorporated, formed or organized and is validly existing under the Laws of its jurisdiction of incorporation or organization, and has the requisite company or corporate power, as applicable, and authority to own, lease or operate all of its properties and assets and to conduct its business as it is now being conducted. The Governing Documents of the Company, as amended to the date of this Agreement and as previously made available by or on behalf of the Company to Acquiror, are true, correct and complete. The Company is duly licensed or qualified and in good standing as a foreign or extra-provincial corporation (or other entity, if applicable) in each jurisdiction in which its ownership of property or the character of its activities is such as to require it to be so licensed or qualified or in good standing, as applicable, except where the failure to be so licensed or qualified or in good standing would not, individually or in the aggregate, have, or reasonably be expected to have, a Company Material Adverse Effect.
Section 4.2. Subsidiaries. A complete list, as of the date of this Agreement, of each Subsidiary of the Company and its jurisdiction of incorporation, formation or organization, outstanding Equity Securities, and holders of Equity Securities (including respective numbers and percentages), as applicable, is set forth on Section 4.2 of the Company Disclosure Letter. The Subsidiaries of the Company have been duly formed or organized and are validly existing under the Laws of their jurisdiction of incorporation or organization and have the requisite power and authority to own, lease or operate all of their respective properties and assets and to conduct their respective businesses as they are now being conducted. True, correct and complete copies of the Governing Documents of the Company’s Subsidiaries, in each case, as amended to the date of this Agreement, have been previously made available to Acquiror by or on behalf of the Company. Each Subsidiary of the Company is duly licensed or qualified and in good standing as a foreign corporation (or other entity, if applicable) in each jurisdiction in which its ownership of property or the character of its activities is such as to require it to be so licensed or qualified or in good standing, as applicable, except where the failure to be so licensed or qualified or in good standing would not, individually or in the aggregate, have, or reasonably be expected to have, a Company Material Adverse Effect.
Section 4.3. Due Authorization.
(a) Other than the Company Shareholder Approval and the shareholder special resolutions to be passed by the Company under the laws of Gibraltar prior to, and in connection with the approval of, the Re-domiciliation and Continuation (the “Re-domiciliation and Continuation Shareholder Approval”), the Company has all requisite company or corporate power, as applicable, and authority to execute and deliver this Agreement and the other documents to which it is a party contemplated hereby and (subject to the approvals described in Section 4.5) to consummate the transactions contemplated hereby and thereby and to perform all of its obligations hereunder and thereunder. The execution and delivery of this Agreement and the other documents to which the Company is a party contemplated hereby and the consummation of the transactions contemplated hereby and thereby have been duly and validly authorized and approved by the Company Board, and other than the Company Shareholder Approval and the Re-domiciliation and Continuation Shareholder Approval, no other company or corporate proceeding on the part of the Company is necessary to authorize this Agreement and the other documents to which the Company is a party contemplated hereby. This Agreement has been, and on or prior to the Acquisition Merger Closing, the other documents to which the Company is a party contemplated hereby will be, duly and validly executed and delivered by the Company and this Agreement constitutes, and on or prior to the Acquisition Merger Closing, the other documents to which the Company is a party contemplated hereby will constitute, a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws (currently in effect or enacted following the date hereof) affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity.
23
(b) Assuming that a quorum (as determined pursuant to the Company Charter) is present, the approval and authorization of the Acquisition Merger and the Plan of Acquisition Merger shall require approval by a special resolution of the holders of at least two-thirds (2/3) of the Company Shares entitled to vote, who attend (in person or by proxy) and vote (in person or by proxy) thereupon (as determined in accordance with the Company’s Governing Documents) at a shareholders’ meeting duly called by the Company Board and held for such purpose (the “Company Shareholder Approval”). The Company Shareholder Approval and the Re-domiciliation and Continuation Shareholder Approval are the only votes of any of the Company Shares necessary in connection with entry into this Agreement and the other Transaction Documents by the Company and the consummation of the transactions contemplated hereby and thereby, including the Acquisition Merger Closing.
(c) On or prior to the date of this Agreement, the Company Board has duly adopted resolutions (i) determining that this Agreement and the other Transaction Documents to which the Company is a party contemplated hereby and the transactions contemplated hereby and thereby are advisable and fair to, and in the best interests of, the Company and its shareholders, as applicable, and (ii) authorizing and approving the execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which the Company is a party contemplated hereby and the transactions contemplated hereby and thereby. No other corporate action is required on the part of the Company or any of its shareholders to enter into this Agreement or the documents to which the Company is a party contemplated hereby or to approve the Transactions other than the Company Shareholder Approval.
Section 4.4. No Conflict. Subject to the receipt of the consents, approvals, authorizations and other requirements set forth in Section 4.3 and Section 4.5 and except as set forth on Section 4.4 of the Company Disclosure Letter, the execution and delivery by the Company of this Agreement and the other Transaction Documents to which the Company is a party and the consummation of the transactions contemplated hereby and thereby do not and will not (a) violate or conflict with any provision of, or result in the breach of, or default under the Governing Documents of the Company, (b) violate or conflict with any provision of, or result in the breach of, or default under any Law or Governmental Order applicable to the Company or any of the Company’s Subsidiaries, (c) violate or conflict with any provision of, or result in the breach of, result in the loss of any right or benefit, or cause acceleration, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under any Contract of the type described in Section 4.12 to which the Company or any of the Company’s Subsidiaries is a party or by which the Company or any of the Company’s Subsidiaries may be bound, or terminate or result in the termination of any such foregoing Contract, or (d) result in the creation of any Lien (other than Permitted Liens) upon any of the properties or assets of the Company or any of the Company’s Subsidiaries, except, in the case of clauses (b) through (d), to the extent that the occurrence of the foregoing would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of the Company to enter into and perform their respective obligations under this Agreement, or (ii) have or reasonably be expected to have a Company Material Adverse Effect.
Section 4.5. Governmental Authorities; Consents. Assuming the truth and completeness of the representations and warranties of Acquiror and the Acquisition Entities contained in this Agreement, no consent, waiver, approval or authorization of, or designation, declaration or filing with, or notification to, any Governmental Authority (each, a “Governmental Authorization”) or other Person is required on the part of the Company or its Subsidiaries with respect to the Company’s execution or delivery of this Agreement or the consummation by the Company of the transactions contemplated hereby, except (a) as otherwise listed in Section 4.5 of the Company Disclosure Letter, (b) for the Company Shareholder Approval and the Re-domiciliation and Continuation Shareholder Approval, (c) the filing of the Proxy/Registration Statement with the SEC, other filings with respect to the Transactions pursuant to the applicable state blue sky or other securities Laws, the filings and consents required from public authorities relating to the Re-domiciliation and Continuation in both Gibraltar and Cayman Islands, the registration of the Plan of Acquisition Merger and filing of the related documentation with the Cayman Registrar, the filing of the Articles of the Surviving Company and the PubCo Charter with the Cayman Registrar and publication of notification of the Acquisition Merger in the Cayman Islands Government Gazette, in each case in accordance with the Cayman Companies Act, and (d) for any consents, approvals, authorizations, designations, declarations, waivers or filings, the absence of which would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of the Company to enter into and perform its obligations under this Agreement, or (ii) be or reasonably be expected to be material to the business of the Company and its Subsidiaries (taken as a whole).
24
Section 4.6. Capitalization of the Company.
(a) As of the date of this Agreement, the authorized share capital of the Company consists of USD 103,000 divided into 300,000 ordinary shares of USD 0.01 each and 100,000,000 preference shares of USD 0.001 each, of which the following are issued and allotted: 1,300 ordinary shares of USD 0.01 each and 36,154,071 preference shares of USD 0.001 each. Set forth in Section 4.6(a) of the Company Disclosure Letter is a true, correct and complete list of each record holder of Company Shares and the number of Company Shares held by each such holder as of the date of this Agreement, which in aggregate constitute the entire issued, allotted and paid-up share capital of the Company as of the date of this Agreement. All of the issued and allotted Company Shares (i) have been duly authorized and validly issued and allotted and are fully paid; (ii) have been offered and issued by the Company in compliance in all material respects with applicable Law, including the Gibraltar Companies Act, and federal and state securities Laws, and all requirements set forth in (1) the Governing Documents of the Company and (2) any other applicable Contracts governing the issuance or allotment of such securities to which the Company is a party or otherwise bound; (iii) are not subject to, nor have they been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of any applicable Law, the Governing Documents of the Company or any Contract to which the Company is a party or otherwise bound; and (iv) were issued free and clear of any Liens (other than the Company’s own Lien as provided for in the Company Charter). All filings and returns required by applicable Law to be delivered or made by the Company to Governmental Authorities in Gibraltar and any other jurisdiction in respect of all issuances and transfers of Company Shares have been duly and correctly delivered or made on a timely basis.
(b) Except as otherwise set forth in Section 4.6(b) of the Company Disclosure Letter and the Collateral Securities (if any), the Company has not issued, granted, and is not otherwise bound by or subject to any outstanding subscriptions, options, restricted stock, restricted stock units, share appreciation rights, warrants, rights or other securities (including debt securities) convertible, into or exchangeable or exercisable for Company Shares, any other commitments, calls, conversion rights, rights of exchange or privilege (whether preemptive, contractual or by matter of Law), plans or other agreements of any character providing for the issuance of additional shares, the sale of treasury shares or other equity interests, or for the repurchase or redemption of shares or other equity interests of the Company or the value of which is determined by reference to shares or other equity interests of the Company, and there are no voting trusts, proxies or agreements of any kind which may obligate the Company to issue, purchase, register for sale, redeem or otherwise acquire any Company Shares. All FDG Tokens issued and outstanding are set forth in Section 4.6(a) of the Company Disclosure Letter, and all Company Preference Shares issuable upon exercise of all issued and outstanding FDG Tokens are issued and outstanding as of the date hereof and are held by Nemi. As of the date hereof, neither the Company nor any of its Subsidiaries has issued any Collateral Securities.
Section 4.7. Capitalization of Subsidiaries.
(a) The outstanding share capital or other Equity Securities of each of the Company’s Subsidiaries (for the purpose of this Section 4.7(a) only, excluding the Acquisition Entities) (i) have been duly authorized and validly issued and allotted, are, to the extent applicable, fully paid and non-assessable; (ii) have been offered and issued in compliance in all material respects with applicable Law, including federal and state securities Laws, and all requirements set forth in (A) the Governing Documents of each such Subsidiary, and (B) any other applicable Contracts governing the issuance or allotment of such securities by such Subsidiary; (iii) other than the Collateral Securities (if any), are not subject to, nor have they been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of any applicable Law, the Governing Documents of each such Subsidiary or any Contract to which any such Subsidiary is a party or otherwise bound; and (iv) were issued free and clear of any Liens.
(b) The Company owns legally and beneficially all the issued and outstanding Equity Securities of such Subsidiaries free and clear of any Liens other than Permitted Liens.
25
(c) Except as set forth on Section 4.7(c) of the Company Disclosure Letter and the Collateral Securities (if any), there are no outstanding subscriptions, options, restricted stock, restricted stock units, stock appreciation rights, warrants, rights or other securities (including debt securities) exercisable or exchangeable for any Equity Securities of such Subsidiaries, any other commitments, calls, conversion rights, rights of exchange or privilege (whether preemptive, contractual or by matter of Law), plans or other agreements of any character providing for the issuance of additional shares, the sale of treasury shares or other equity interests, or for the repurchase or redemption of shares or other Equity Securities of such Subsidiaries or the value of which is determined by reference to shares or other equity interests of the Subsidiaries, and there are no voting trusts, proxies or agreements of any kind which may obligate any Subsidiary of the Company to issue, purchase, register for sale, redeem or otherwise acquire any of its Equity Securities.
Section 4.8. Financial Statements; Internal Controls.
(a) The Company has previously provided to Acquiror true and complete copies of the unaudited consolidated statement of financial position and consolidated statements of comprehensive income, changes in equity and cash flows of the Company and its Subsidiaries as of and for the years ended 30 June, 2024 and 30 June, 2025, which comply in all material respects with the applicable accounting requirements (including the standards of the PCAOB) and with the rules and regulations of the SEC, the Exchange Act and the Securities Act applicable to a registrant (the “Financial Statements”).
(b) Except as set forth on Section 4.8(b) of the Company Disclosure Letter, the Financial Statements (i) fairly present in all material respects the consolidated financial position of the Company and its consolidated Subsidiaries, as at the respective dates thereof, and the consolidated results of their operations, their consolidated incomes, their consolidated changes in equity and their consolidated cash flows for the respective periods then ended (except as may be indicated in the notes thereto and subject to normal year-end adjustment and the absence of footnotes if applicable), (ii) were prepared in conformity with IFRS applied on a consistent basis during the periods involved (subject to normal year-end adjustment and the absence of footnotes if applicable), (iii) were prepared from, and are in accordance in all material respects with, the books and records of the Company and its consolidated Subsidiaries, and (iv) were prepared in compliance in all material respects with the applicable accounting requirements (including the standards of the PCAOB) and with the rules and regulations of the SEC, the Exchange Act and the Securities Act applicable to a registrant, in effect as of the respective dates thereof.
(c) Neither the Company nor any director or officer of the Company or any of its Subsidiaries nor, to the knowledge of the Company, any independent auditor of the Company or its Subsidiaries, has identified or been made aware of (i) any significant deficiency or material weakness in the system of internal accounting controls utilized by the Company or any of its Subsidiaries, (ii) any fraud, whether or not material, that involves the Company’s management or other employees who have a role in the preparation of financial statements or the internal accounting controls utilized by the Company or any of its Subsidiaries or (iii) any claim or allegation regarding any of the foregoing.
(d) The Company maintains a system of internal accounting controls which the Company reasonably believes is 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 IFRS 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. The books and records of the Company have been, and are being, maintained in all material respects in accordance with IFRS and any other applicable legal and accounting requirements.
(e) Except as set forth on Section 4.8(e) of the Company Disclosure Letter, there are no outstanding loans or other extensions of credit made by the Company or its Subsidiaries to any of their respective executive officers (as defined in Rule 3b-7 under the Exchange Act) or any director of the Company or its Subsidiaries.
26
Section 4.9. Undisclosed Liabilities. Except for any Company Transaction Expenses, there is no other liability, Indebtedness or obligation of, or claim or judgment against, the Company or any of the Company’s Subsidiaries (whether direct or indirect, absolute or contingent, accrued or unaccrued, known or unknown, liquidated or unliquidated, or due or to become due), except for liabilities, debts, obligations, claims or judgments (a) reflected or reserved for on the Financial Statements or disclosed in the notes thereto, (b) that have arisen since the date of the most recent statement of financial position included in the Financial Statements in the ordinary course of business, consistent with past practice, of the Company and its Subsidiaries, (c) that are executory obligations under any Contract to which the Company or any of its Subsidiaries is a party or by which it is bound incurred in the ordinary course of business consistent with past practice of the Company and its Subsidiaries, (d) arising under this Agreement or any other Transaction Document, (e) that will be discharged or paid off prior to or at the Acquisition Merger Closing or (f) which are not and would not reasonably be expected to be material to the Company and its Subsidiaries (taken as a whole). As of the date hereof, as of the Acquisition Merger Closing and as of the Reincorporation Merger Closing, the Company is and will be solvent.
Section 4.10. Litigation and Proceedings. Except as set forth on Section 4.10 of the Company Disclosure Letter, as of the date hereof (a) there are no pending or, to the knowledge of the Company, threatened, lawsuits, claims, proceedings or any other Actions (including any investigations or formal inquiries pending or, to the knowledge of the Company, threatened at law or in equity by or before any Governmental Authority (collectively, “Legal Proceedings”)), against the Company or any of the Company’s Subsidiaries or their respective properties or assets involving an amount that exceeds $1,000,000; and (b) there is no outstanding Governmental Order specifically directed at and imposed upon the Company or any of the Company’s Subsidiaries or any of their respective properties or assets, except, in each case, as would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of the Company to enter into and perform its obligations under this Agreement, or (ii) be or reasonably be expected to be material to the business of the Company and its Subsidiaries (taken as a whole).
Section 4.11. Legal Compliance.
(a) Except as disclosed on Section 4.11(a) of the Company Disclosure Letter or as would not be or reasonably be expected to be material to the business of the Company and its Subsidiaries (taken as a whole), each of the Company and its Subsidiaries is in compliance with all applicable Laws in all material respects.
(b) Except as disclosed on Section 4.11(b) of the Company Disclosure Letter, in the past three (3) years, none of the Company or any of its Subsidiaries has received any written notice of, or been charged with, the violation of any Laws, by any Governmental Authority, except where such violation has not been and would not reasonably be expected to be material to the business of the Company and its Subsidiaries, taken as a whole.
(c) The Company and its Subsidiaries maintain a program of policies, procedures and internal controls reasonably designed and implemented to provide reasonable assurance that violation of applicable Law by any of the Company’s or its Subsidiaries’ directors, officers, or employees, acting on behalf of the Company or any of the Company’s Subsidiaries, will be prevented, detected and deterred.
Section 4.12. Contracts; No Defaults.
(a) Section 4.12(a) of the Company Disclosure Letter contains a listing of all Contracts described in clauses (i) through (xiv) below to which, as of the date of this Agreement, the Company or any of the Company’s Subsidiaries is a party or by which they are bound, other than a Company Benefit Plan, and true, correct and complete copies of the Contracts listed on Section 4.12(a) of the Company Disclosure Letter have previously been delivered to or made available to Acquiror or its Representatives, together with all amendments thereto.
(i) Each Contract involving obligations (contingent or otherwise), payments or revenues in excess of $750,000 in the twelve months ended December 31, 2024 or expected obligations (contingent or otherwise), payments or revenues in excess of $750,000 in the next twelve months after the date of this Agreement;
27
(ii) Each outstanding note, debenture, other evidence of Indebtedness, guarantee, loan, credit or financing agreement or instrument or other Contract for money borrowed by, or other Indebtedness of, the Company or any of the Company’s Subsidiaries, including any other agreement or commitment for future loans, credit or financing, in each case, in excess of $100,000 since December 31, 2024;
(iii) Each Contract for the acquisition of any Person or any business unit thereof or the disposition of any material assets of the Company or any of its Subsidiaries in the last three (3) years, in each case, involving payments in excess of $250,000 other than Contracts (A) in which the applicable acquisition or disposition has been consummated and there are no material obligations ongoing, or (B) solely between the Company and its wholly-owned Subsidiaries;
(iv) Each lease, rental or occupancy agreement, license, installment and conditional sale agreement, and other Contract that provides for the ownership of, leasing of, title to, use of, or any leasehold or other interest in any real or tangible personal property that involves aggregate payments in excess of $100,000 in any calendar year since the incorporation;
(v) Each Contract involving the formation, establishment, contribution to, or operation of a (A) partnership, (B) corporation, limited liability company or other entity, or (C) joint venture, alliance or similar entity, or involving a sharing of profits or losses (including joint development and joint marketing Contracts), or any investment in, loan to or acquisition or sale of the securities, Equity Securities or assets of any person involving payments of an amount higher than $100,000 (excluding, in the case of clauses (A) and (B), any wholly-owned Subsidiary of the Company);
(vi) Contracts between the Company and its Subsidiaries, on the one hand, and any Company Related Party, on the other hand, which are currently in force or under which any party thereto has outstanding obligations (collectively, “Related Party Agreements”), other than (1) Company Benefit Plans, (2) expense reimbursement arrangements entered into in the ordinary course of business consistent with past practice and (3) Contracts contemplated by this Agreement or other Transaction Documents;
(vii) Contracts that provide for change in control, retention or similar payments or benefits contingent upon, accelerated by or triggered by the consummation of the transactions contemplated hereby, other than any Contracts involving payments of an amount not exceeding $250,000 annually or in the aggregate;
(viii) Contracts containing covenants of the Company or any of the Company’s Subsidiaries (A) prohibiting or limiting the right of the Company or any of the Company’s Subsidiaries to engage in or compete with any Person in any line of business in any material respect or (B) prohibiting or restricting the Company’s and the Company’s Subsidiaries’ ability to conduct their business with any Person in any geographic area in any material respect;
(ix) Any collective bargaining agreement or similar labor-related Contract between the Company or any of the Company’s Subsidiaries, on one hand, and any labor union or other similar labor organization representing employees of the Company or any of the Company’s Subsidiaries, on the other hand;
(x) Each Contract (including license agreements, coexistence agreements and agreements with covenants not to sue, but not including assignment or transfer agreements, non-disclosure agreements or incidental trademark or other licenses incident to marketing, printing or advertising or services or other agreements entered into in the ordinary course of business) pursuant to which the Company or any of the Company’s Subsidiaries (A) grants to a third Person the right to use Intellectual Property of the Company and its Subsidiaries that is material to the business of the Company and its Subsidiaries, taken as a whole (other than non-exclusive licenses granted in the ordinary course of business consistent with past practice), or (B) is granted by a third Person the right to use Intellectual Property that is material to the business of the Company and its Subsidiaries, taken as a whole (other than Contracts granting non-exclusive rights to use COTS Technology or Open Source Software);
28
(xi) Any Contract (A) containing an agreement by the Company or any of its Subsidiaries to provide any Person with access to the Company’s or such Subsidiaries’ source code or (B) between the Company or one of its Subsidiaries and an escrow agent providing for the placement of the Company or such Subsidiaries’ source code into escrow;
(xii) Each Contract requiring capital expenditures by the Company or any of the Company’s Subsidiaries after the date of this Agreement in an amount in excess of $500,000 in any calendar year;
(xiii) Any Contract that (A) grants to any third Person any “most favored nation rights”; or (B) grants to any third Person (except for the Company’s wholly-owned Subsidiaries) price guarantees for a period greater than one (1) year from the date of this Agreement and involves in excess of $500,000 in any calendar year;
(xiv) Contracts granting to any Person (other than the Company or its Subsidiaries) a right of first refusal, first offer or similar preferential right to purchase or acquire equity interests or any other property of or in the Company or any of the Company’s Subsidiaries;
(xv) All Contracts providing for guarantees, indemnification arrangements and other hold harmless arrangements made or provided by the Company, including all ongoing agreements for repair, warranty, maintenance, service, indemnification or similar obligations, other than Standard Contracts, in each case that may involve potential liabilities in excess of $500,000 in any calendar year;
(xvi) Contracts in connection with the waiver, compromise, or settlement of any Legal Proceedings involving payment of an amount greater than $100,000 that remains outstanding as of the date of this Agreement;
(xvii) Contracts with any Governmental Authority;
(xviii) Contracts with the top five (5) vendors based on the aggregate dollar value of the Company’s and its Subsidiaries’ transaction volume with such counterparty during the twelve months for the period ended January 31, 2026;
(xix) Contracts with a sole-source supplier of any product or service in each case involving payments of an amount higher than $100,000; and
(xx) Any outstanding written commitment to enter into any Contract of the type described in subsections (i) through (xix) of this Section 4.12(a).
(b) Except for any Contract that will terminate upon the expiration of the stated term thereof prior to the Acquisition Merger Closing Date, all of the Contracts listed pursuant to Section 4.12(a) in the Company Disclosure Letter are (i) in full force and effect and (ii) represent the legal, valid and binding obligations of the Company or the Subsidiary of the Company party thereto and, to the knowledge of the Company, represent the legal, valid and binding obligations of the counterparties thereto. Except, in each case, where the occurrence of such breach or default or failure to perform would not have a Company Material Adverse Effect, (x) the Company and its Subsidiaries have performed in all respects all respective obligations required to be performed by them to date under such Contracts listed pursuant to Section 4.12(a) and neither the Company, the Company’s Subsidiaries, nor, to the knowledge of the Company, any other party thereto is in breach of or default under any such Contract, (y) during the last twelve (12) months, neither the Company nor any of its Subsidiaries has received any written claim or notice of termination, cancellation or breach of or default under any such Contract, and (z) to the knowledge of the Company, no event has occurred which individually or together with other events, has or would reasonably be expected to result in a breach of or a default under any such Contract by the Company or any of its Subsidiaries or, to the knowledge of the Company, any other party thereto (in each case, with or without notice or lapse of time or both).
29
Section 4.13. Company Benefit Plans.
(a) Section 4.13(a) of the Company Disclosure Letter sets forth a complete list, as of the date hereof, of each material Company Benefit Plan. With respect to each material Company Benefit Plan, the Company has made available to Acquiror, to the extent applicable, true, complete and correct copies of (A) such Company Benefit Plan (or, if not in writing, a written summary of its material terms) and all plan documents, trust agreements, insurance Contracts or other funding vehicles and all amendments thereto, (B) the most recent annual reports (or equivalent filings or audits required to be made by applicable Law), if any, required by applicable Law to be filed with a Governmental Authority with respect to Taxes in connection with each Company Benefit Plan, (C) the most recent determination or opinion letter, or equivalent materials, from the applicable taxing authority with respect to each Company Benefit Plan, if any, and (D) the most recent actuarial report or other financial statement relating to such Company Benefit Plan, if any.
(b) (i) Each Company Benefit Plan has been established, operated, funded, maintained and administered in compliance with its terms and all applicable Laws, except where failure to comply would not be or reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole; and (ii) in all material respects, all contributions required to be made with respect to any Company Benefit Plan on or before the date hereof have been made and all obligations in respect of each Company Benefit Plan as of the date hereof have been accrued and reflected in the Company’s financial statements to the extent required by IFRS.
(c) With respect to each Company Benefit Plan, no actions, suits or claims (other than routine claims for benefits in the ordinary course) are pending or, to the knowledge of the Company, threatened, and to the knowledge of the Company, no facts or circumstances exist that would reasonably be expected to give rise to any such actions, suits or claims, other than those actions, suits or claims that will not reasonably be expected to have, a material adverse effect on the Company and its Subsidiaries (taken as a whole).
(d) No Company Benefit Plan provides medical, surgical, hospitalization, death or similar benefits (whether or not insured) for employees or former employees of the Company or any Subsidiary for periods extending beyond their retirement or other termination of service, other than (i) coverage mandated by applicable Law, (ii) death benefits under any “pension plan,” or (iii) benefits the full cost of which is borne by the current or former employee (or his or her beneficiary).
(e) Except as set forth on Section 4.13(e) of the Company Disclosure Letter, the consummation of the transactions contemplated hereby will not, either alone or in combination with another event (such as a termination of employment or service following the consummation of the transactions contemplated hereby), (i) entitle any current or former employee, officer or other individual service provider of the Company or any Subsidiary of the Company to any severance pay or any other compensation or benefits payable or to be provided by the Company or any Subsidiary of the Company or (ii) accelerate the time of payment, funding or vesting, or increase the amount of compensation or benefits due to any such employee, officer or other individual service provider by the Company or a Subsidiary of the Company.
Section 4.14. Labor Relations; Employees.
(a) (i) Neither the Company nor any of its Subsidiaries is a party to or bound by any collective bargaining agreement, or any similar labor-related agreement with any labor union or similar labor organization representing employees of the Company or any of the Company’s Subsidiaries, and no such agreement is currently being negotiated by the Company or any of the Company’s Subsidiaries, and (ii) to the knowledge of the Company, no labor union or any other similar labor organization has a certification or representation petition currently pending before any applicable labor relations tribunal or similar Governmental Authority seeking to represent any of the employees of the Company or its Subsidiaries. To the knowledge of the Company, there has been no labor organizing activity involving any employees of the Company or any of its Subsidiaries in the past three (3) years. In the past three (3) years, there has been no actual or, to the knowledge of the Company, threatened strike, concerted slowdown, concerted work stoppage, lockout or other labor dispute against the Company or any Subsidiary of the Company, in each case except as would not be or reasonably be expected to be, individually or in the aggregate, material to the business of the Company and its Subsidiaries, taken as a whole.
30
(b) Each of the Company and its Subsidiaries are and have been for the past three (3) years, in compliance with all applicable Laws respecting labor and employment including, but not limited to, all Laws respecting terms and conditions of employment, health and safety, wages and hours, holiday pay, working time, employee classification, child labor, immigration, employment discrimination, disability rights or benefits, equal opportunity and equal pay, plant closures and layoffs, affirmative action, workers’ compensation, labor relations, and employee leave issues, except where the failure to comply would not reasonably be expected to be, individually or in the aggregate, have a Company Material Adverse Effect.
(c) In the past three (3) years, except as would not be or reasonably be expected to be material to the business of the Company and its Subsidiaries (taken as a whole), the Company and its Subsidiaries have not been party to (i) any material charge or complaint pending or to the knowledge of the Company threatened, before any Governmental Authority responsible for the prevention of unlawful employment practices brought by any employee of the Company or its Subsidiaries, (ii) to the knowledge of the Company, any investigation by any Governmental Authority responsible for the enforcement of labor, employment, wages and hours of work, child labor, immigration, or occupational safety and health Laws relating to the Company’s labor or employment practices, or (iii) any complaint or lawsuit pending or, to the knowledge of the Company, threatened before any Governmental Authority by or on behalf of any present or former employee of the Company or its Subsidiaries alleging violations of any applicable Law governing employment or the termination thereof involving an amount claimed against any of the Company or its Subsidiaries that exceeds $200,000.
(d) To the knowledge of the Company, no present employee of the Company or any of the Company’s Subsidiaries is in material violation of (i) any restrictive covenant or nondisclosure agreement with the Company or any of the Company’s Subsidiaries or (ii) any restrictive covenant or nondisclosure agreement with a former employer of such individual relating to (A) the right of any such individual to work for or provide services to the Company or any of the Company’s Subsidiaries’ or (B) the knowledge or use of trade secrets or proprietary information of such former employer, in each case except as would not be or reasonably be expected to be, individually or in the aggregate, material to the business of the Company and its Subsidiaries, taken as a whole.
(e) Neither the Company nor any of the Company’s Subsidiaries is party to a settlement agreement with outstanding obligations with a current or former officer or employee of the Company or any of the Company’s Subsidiaries that involves allegations of sexual harassment, sexual misconduct or unlawful discrimination against any current (i) officer of the Company or any of the Company’s Subsidiaries or (ii) executive-level employee of the Company or any of the Company’s Subsidiaries. To the knowledge of the Company, there are no material allegations of sexual harassment, sexual misconduct or unlawful discrimination against any current (y) officer of the Company or any of the Company’s Subsidiaries or (z) executive-level employee of the Company or any of the Company’s Subsidiaries, in each case made to or filed with the human resources department of the Company or the Company’s Subsidiaries by another employee of the Company or the Company’s Subsidiaries and currently pending or being investigated.
(f) In the past three (3) years, the Company and its Subsidiaries have not implemented any group terminations, group layoffs or similar workforce actions that required notices be provided to employees of the Company or its Subsidiaries pursuant to any Law where any material liability remains outstanding.
Section 4.15. Taxes.
(a) All income Tax Returns and all other material Tax Returns required to be filed by or with respect to the Company or any of its Subsidiaries have been timely filed (taking into account any applicable extensions) and all such Tax Returns (taking into account all amendments thereto) are true, correct and complete in all material respects. All material Taxes due and payable (whether or not shown on any Tax Return) have been fully and timely paid.
(b) The Company and each of its Subsidiaries have withheld from amounts owing to any employee, creditor or other Person all material Taxes required by Law to be withheld, paid over to the proper Governmental Authority in a timely manner all such withheld amounts required to have been so paid over and complied in all material respects with all applicable withholding and related reporting requirements with respect to such Taxes.
31
(c) No claim, assessment, deficiency or proposed adjustment for any material amount of Tax has been asserted or assessed by any Governmental Authority against the Company or any of its Subsidiaries that remains unresolved or unpaid.
(d) The Company and each of its Subsidiaries has complied in all material respects with all applicable Laws relating to Tax during the past six (6) years and has not failed to comply with an applicable Law relating to Tax for which the applicable statute of limitations has not expired as of the date hereof. There is no Tax audit or other examination of the Company or any of its Subsidiaries presently in progress, nor has the Company or any of its Subsidiaries been notified of any request or threat for such an audit or other examination. There are no waivers, extensions or requests for any waivers or extensions of any statute of limitations currently in effect with respect to any Taxes of the Company or any of its Subsidiaries.
(e) Neither the Company nor any of its Subsidiaries has made a request for or entered into a closing agreement, private letter ruling, advance tax ruling or similar agreement with any Governmental Authority with respect to Taxes. Neither the Company nor any of its subsidiaries has made a change of any method of accounting with respect to any Taxes.
(f) Neither the Company nor any of its Subsidiaries is a party to any Tax indemnification or Tax sharing or similar Tax agreement (other than any such agreement solely between the Company and a Subsidiary the equity of which is 100% owned by the Company either directly or indirectly and Contracts entered into in the ordinary course of business, in each case not primarily related to Taxes).
(g) No written claim has been made (or written notification delivered in any form) by any Governmental Authority where the Company or any of its Subsidiaries does not file Tax Returns that it is or may be subject to taxation in that jurisdiction.
(h) Except as disclosed on Schedule 4.15(h) of the Company Disclosure Letter, neither the Company nor any of its Subsidiaries has, or has ever had, a permanent establishment in any country other than the country of its organization, or is, or has ever been, subject to income Tax in a jurisdiction outside the country of its organization.
(i) The Company has not been, is not, and immediately prior to the Acquisition Merger Effective Time and Reincorporation Merger Effective Time will not be, treated as an “investment company” within the meaning of Section 368(a)(2)(F) of the Code.
(j) Neither the Company nor any of its Subsidiaries has taken any action or agreed to take any action, nor to the knowledge of the Company or any of its Subsidiaries are there any facts or circumstances, that would reasonably be expected to prevent, impair or impede the Intended Tax Treatment.
(k) There are no Liens for Taxes (other than Permitted Liens) upon the property or assets of the Company or any of its Subsidiaries.
(l) Neither the Company nor any of its Subsidiaries has participated in any “listed transaction,” or has failed to disclose a “reportable transaction” in each case as defined in U.S. Treasury Regulation section 1.6011-4(b).
(m) Neither the Company nor any of its Subsidiaries: (i) has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of securities (to any Person or entity that is not a member of the consolidated group of which the Company is the common parent corporation) qualifying for, or intended to qualify for, Tax-free treatment under Section 355 of the Code (A) within the two-year period ending on the date hereof or (B) in a distribution which could otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the Code) in conjunction with the transactions contemplated by this Agreement; (ii) is or has ever been (A) a U.S. real property holding corporation within the meaning of Section 897(c)(2) of the Code, (B) a member of any consolidated, combined, unitary or affiliated group of corporations for any Tax purposes other than a group of which the Company is or was the common parent corporation, or (C) has Liability for the Taxes under Treasury Regulation section 1.1502-6 (or any similar provision of state, local, or non-U.S. law), as a transferee or successor, by contract, or otherwise; or (iii) is a “controlled foreign corporation” as defined in Section 957 of the Code.
32
(n) The Company and each of its Subsidiaries have not deferred the withholding or remittance of any Taxes related or attributable to any wages for any employees of the Company.
(o) The Company and each of its Subsidiaries been in compliance in all respects with all applicable transfer pricing laws and legal requirements in all material respects.
(p) Neither the Company nor any of its Subsidiaries will be required to include any material item of income or exclude any material item of deduction for any taxable period beginning after the Closing Date as a result of: (i) any installment sale or open sale transaction disposition made by the Company nor any of its Subsidiaries before the Closing; (ii) any prepaid amount received outside of the ordinary course of business by the Company nor any of its Subsidiaries before the Acquisition Merger Closing; or (iii) any intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of state, local or non-U.S. income Tax law) existing before the Acquisition Merger Closing.
(q) The Company and each of its Subsidiaries have, with advice of U.S. tax counsel, considered the qualification of Acquisition Merger for the Acquisition Intended Tax Treatment and after such consideration, to the Knowledge of the Company and each of its Subsidiaries, there are no facts or circumstances that would reasonably be expected to prevent the Acquisition Merger from qualifying for the Acquisition Intended Tax Treatment.
(r) To the knowledge of the Company and each of its Subsidiaries, there are no facts or circumstances that would reasonably be expected to prevent the Reincorporation Merger from qualifying for the Reincorporation Intended Tax Treatment.
(s) The Company is a corporation for United States federal income tax purposes and is a “foreign person” within the meaning of section 1445(f)(3) of the Code. The Company is not, and has never been, created or organized in, or under the law of, the United States, any state thereof, or the District of Columbia. The Company is not treated as a domestic corporation pursuant to section 7874(b) of the Code and has not elected pursuant to section 897(i) of the Code to be treated as a domestic corporation for purposes of sections 897 and 1445 of the Code.
Section 4.16. Insurance. Section 4.16 of the Company Disclosure Letter contains a list of, as of the date hereof, all material policies or binders of property, fire and casualty, product liability, workers’ compensation, and other forms of insurance held by, or for the benefit of, the Company or any of the Company’s Subsidiaries as of the date of this Agreement. True, correct and complete copies of such insurance policies as in effect as of the date hereof have previously been made available to Acquiror. All such policies are in full force and effect, all premiums due have been paid, and no notice of cancellation or termination has been received by the Company or any of the Company’s Subsidiaries with respect to any such policy. Except as disclosed on Section 4.16 of the Company Disclosure Letter, no insurer has denied or disputed coverage of any material claim under an insurance policy during the last three (3) years.
Section 4.17. Licenses. The Company and its Subsidiaries have obtained, and maintain, all of the material Licenses reasonably required to permit the Company and its Subsidiaries to acquire, originate, own, operate, use and maintain their assets substantially in the manner in which they are now operated and maintained and to conduct the business of the Company and its Subsidiaries as currently conducted in all material respects. Each material License held by the Company or any of the Company’s Subsidiaries is in full force and effect. Neither the Company nor any of its Subsidiaries (a) is in default or violation (and no event has occurred which, with notice or the lapse of time or both, would constitute a material default or violation) of any term, condition or provision of any material License to which it is a party, (b) is or has been the subject of any pending or, to the knowledge of the Company, threatened Action by a Governmental Authority seeking the revocation, suspension, termination, modification, or impairment of any material License, or (c) has received any notice that any Governmental Authority that has issued any material License intends to cancel, terminate, materially modify the terms of, or not renew any such material License, except to the extent such material License may be amended, replaced, or reissued as a result of and as necessary to reflect the transactions contemplated hereby, or as otherwise disclosed in Section 4.17 of the Company Disclosure Letter. Section 4.17 of the Company Disclosure Letter sets forth a true, correct and complete list of all material Licenses held by the Company or its Subsidiaries.
33
Section 4.18. Real Property.
(a) Section 4.18(a) of the Company Disclosure Letter sets forth a true, correct and complete list, as of the date of this Agreement of (w) the street address of each parcel of Leased Real Property, (x) the identity of the lessor, lessee and current occupant (if different from lessee) of each such parcel of Leased Real Property, (y) the terms and rental payment amounts pertaining to each such parcel of Leased Real Property and (z) the current use of each such parcel of Leased Real Property. Neither the Company nor its Subsidiaries owns any real property. Except as would not be or reasonably be expected to be material to the business of the Company and its Subsidiaries (taken as a whole), with respect to each parcel of Leased Real Property:
(i) The Company or one of its Subsidiaries holds a good and valid leasehold estate in such Leased Real Property, free and clear of all Liens, except for Permitted Liens.
(ii) The Company and its Subsidiaries have delivered to Acquiror true, correct and complete copies of all leases, lease guaranties, subleases, agreements for the leasing, use or occupancy of, or otherwise granting a right in and to the Leased Real Property by or to the Company or any of its Subsidiaries, including all amendments, terminations and modifications thereof (collectively, the “Real Property Leases”), and none of such Real Property Leases has been modified in any material respect, except to the extent that such modifications have been disclosed by the copies delivered to Acquiror.
(iii) The Company’s and its Subsidiaries’, as applicable, possession and quiet enjoyment of the Leased Real Property under such Real Property Leases has not been materially disturbed and, there are no material disputes pending or to the knowledge of the Company threatened with respect to such Real Property Leases.
(iv) To the knowledge of the Company, no party, other than the Company or its Subsidiaries, has any right to use or occupy the Leased Real Property or any portion thereof.
(v) Neither the Company nor any of its Subsidiaries has received written notice of any condemnation proceeding or proposed similar Action or agreement for taking in lieu of condemnation with respect to any portion of the Leased Real Property. No material defaults by (A) the Company or its Subsidiaries or (B) to the knowledge of the Company, any landlord or sub-landlord, as applicable, presently exists under any Real Property Lease.
Section 4.19. Intellectual Property.
(a) Section 4.19(a) of the Company Disclosure Letter contains a complete and accurate list of all: (i) Intellectual Property Registrations as of the date of this Agreement, whether applied for or registered; (ii) material unregistered trademarks used by the Company (“Unregistered Marks”) and material unregistered copyrightable works (“Copyrightable Works”), in each case within the Company Owned IP; (iii) any Software within the Company Owned IP identified by project name; (iv) social media handles and their corresponding social media platforms within the Company Owned IP; and (v) Company Licensed IP, excluding (A) Open Source Software or (B) COTS Technology. Section 4.19(a) of the Company Disclosure Letter sets forth for each disclosed item, as may be applicable, the name of the current owner; the registration, issue, registration, application, and filing numbers and dates; the jurisdiction; the title or mark; the licensor, agreement name, parties, and date, the Governmental Authority or registrar; and status (including expiration dates). All required filings and maintenance/renewal fees related to the Intellectual Property Registrations have been timely filed with and paid to the relevant Governmental Authorities and authorized registrars, and there are no such fees or maintenance or renewal filings due within six (6) months after the date of this Agreement.
(b) The Company or one of the Company’s Subsidiaries is the sole and exclusive beneficial and record owner of all of the items of all right, title and interest in and to the Company Owned IP, free and clear of Liens other than Permitted Liens. The Company Owned IP, including the Intellectual Property Registrations, is subsisting, valid and enforceable. The Company has not dedicated to the public or otherwise allowed to fall into the public domain any Intellectual Property previously constituting Company Owned IP. All Intellectual Property that
34
has ever been developed and utilized by the Company is Company Owned IP. The Company or one of its Subsidiaries has a valid, enforceable and continuing right to use, license or otherwise exploit, as the case may be, pursuant to valid and enforceable written Inbound Intellectual Property Agreements (complete and correct copies of which have been made available to the Acquiror), all Company Licensed IP in the manner in which the Company or one of its Subsidiaries has used and/or commercially exploited such Company Licensed IP in the conduct of the business of the Company or such Subsidiary as previously and presently conducted. The Company Intellectual Property constitutes all Intellectual Property used in, held for use in the conduct and operations of the business of the Company as currently conducted.
(c) The Company or one of its Subsidiaries has entered into valid and enforceable written agreements with all past and current employees, independent contractors and consultants who or that have been employed, engaged or otherwise retained at any time by the Company or one of its Subsidiaries and who or that have contributed to the discovery, conception, development, creation, or reduction to practice of any Intellectual Property for or on behalf of the Company or otherwise within the scope of such employment, engagement or retention, in each case, pursuant to which each such Person has: (i) effectively, validly and irrevocably assigned to the Company all of such Person’s right, title, and interest in and to all such Intellectual Property, except non-assignable rights, which have been licensed to the Company on a perpetual, worldwide, royalty-free, fully paid up and non-exclusive basis; (ii) agreed to hold all Trade Secrets of the Company in confidence both during and after his or her employment, engagement or retention, as applicable; and (iii) waived their non-assignable rights (including moral rights) to any such Intellectual Property (collectively, the “Personnel IP Contracts”). The Company has made available to the Acquiror its templates of Personnel IP Contracts relating to and evidencing the Company’s ownership of Company Owned IP. No such Person has any claim, right or interest in or to any Company Owned IP.
(d) The consummation of the Transactions shall not result in (i) any assignment, forfeiture, termination, or placement of any Lien on Company Intellectual Property or any other restriction, limitation, loss or impairment of or payment of any additional amounts with respect to, nor require the consent of any other Person in respect of, the Company’s right to own, use or hold for use any Company Intellectual Property, (ii) the Company being in breach of any Contract involving Intellectual Property; (iii) the modification, cancellation, termination, suspension or acceleration of, any payment with respect to any Contract governing any Intellectual Property; or (iv) Acquiror or its Affiliates, or the Company and its Subsidiaries (each being “that Person” within the meaning of this subsection) being (A) bound by or subject to any noncompete or licensing obligation, covenant not to sue, or other restriction on or modification of the operation or scope of the current business of the Company or any of its Subsidiaries, which that Person was not bound by or subject to prior to Acquisition Merger Closing, or (B) obligated to (1) pay any royalties, honoraria, fees or other payments to any Person in excess of those payable by the Company and its Subsidiaries (taken as a whole) prior to the Acquisition Merger Closing, or (2) provide or offer any discounts or other reduced payment obligations to any Person in excess of those provided by the Company and its Subsidiaries (taken as a whole) to that Person prior to the Acquisition Merger Closing.
(e) None of the Company Owned IP, the Company or its Subsidiaries’ use of the Company Licensed IP, the conduct or operations of the Company, or the Company Products (or the making, use, offer for sale, sale, importation, exportation, distribution, performance or other disposal or exploitation of any such Company Products) has infringed, misappropriated (or constituted or resulted from a misappropriation of) or otherwise violated, or does infringe, misappropriate (or constitute or result from a misappropriation of) or otherwise violate, any Intellectual Property of any Person; provided, however, that the representations and warranties contained in this sentence shall be subject to the knowledge of the Company as they related to Open Source Software and COTS Technology. No Action is pending, threatened by a communication in writing received by the Company or, to the knowledge of the Company, threatened orally, either: (i) involving a claim against the Company or one of its Subsidiaries of infringement, misappropriation or other violation of any Intellectual Property of any Person; or (ii) challenging (A) the Company and its Subsidiaries’ use, practice or other exploitation of any Company Owned IP or any Company Licensed IP, (B) the Company and its Subsidiaries’ ownership of any Company Owned IP, (C) the validity or enforceability of any Company Owned IP, or (D) the validity or enforceability of any Company Licensed IP exclusively licensed to the Company or its Subsidiaries or, any other material Company Licensed IP but solely to the extent that the Company or any of its Subsidiaries was the recipient of the challenge or has been notified by such challenge by the relevant licensor(s). Except as set forth in Section 4.19(e) of the Company Disclosure Letter, the Company has not received any notice alleging that it has infringed, misappropriated or otherwise violated or is infringing, misappropriating, or otherwise violating, any Intellectual Property of any Person, and, to the knowledge of the Company, there are no facts or circumstances that would form the basis for
35
any such claim or challenge. To the knowledge of the Company, no Person has infringed, misappropriated or otherwise violated, or is infringing, misappropriating or otherwise violating any Company Owned IP or any Company Licensed IP exclusively licensed to the Company or its Subsidiaries, and no such claims have been made against any Person by the Company or its Subsidiaries nor has the Company or its Subsidiaries invited any Person to take a license with respect to any Company Owned IP or any Company Licensed IP exclusively licensed to the Company or its Subsidiaries.
(f) The Company has made available to Acquiror the repositories representing all Software within the Company Owned IP. No third party has been granted any right or license to the Company Products or any of the Intellectual Property embodied therein, other than non-exclusive licenses granted pursuant to an end user license agreement to customers of the Company or any of its Subsidiaries in the ordinary course of business consistent with past practice.
(g) The Company is in actual possession and control of (i) the applicable source code, object code, and user manuals for all Software within the Company Owned IP and for all Software within the Company Products, and (ii) Technical Documentation sufficient to allow for the continuation of the use, distribution, development, enhancement, maintenance and support of each item of such Software within the Company Owned IP. The source code for all current versions of Company Products can be compiled without material error into object code by a trained computer programmer. None of the source code or materials described in (i) and (ii) above, except those pertaining to COTS Technology or Open Source Software, has been licensed or provided to, or otherwise used or accessed by, any Person other than employees, consultants and contractors of the Company or its Subsidiaries, in each case, who or that have a “need to know” such source code and materials in connection with the performance of their duties to the Company or its Subsidiaries, and have a written confidentiality obligation to the Company or one of its Subsidiaries, as applicable, with respect to such source code or related materials. Neither the Company nor its Subsidiaries are obligated to provide to any Person the source code for any Software within the Company Owned IP. None of the source code or related materials for any Software within the Company Owned IP is in escrow or under any obligation to be deposited in escrow.
(h) All Software within the Company Owned IP and all Company Products perform in all material respects in accordance with the documentation and other written materials related thereto, is free of any exposed keys or credentials that permit unauthorized access or the unauthorized disruption, impairment, disablement or erasure of such Software, and is free from any defect, bug, virus, design or documentation error or corruptant that would have a material effect on the operation or use of such Software and that cannot be remedied or fixed in accordance with standard software development practices; provided, however, that the representations and warranties set forth in this sentence shall be to the knowledge of the Company as they relate to COTS Technology and Open Source Software. All reported material defects, warranty claims, and reports of errors are reflected in support logs maintained by the Company or one of its Subsidiaries in the ordinary course of business. No Software within the Company Owned IP contains any “back door,” “drop dead device,” “time bomb,” “Trojan horse,” “virus” or “worm” (as such terms are commonly understood in the software industry) or any other code designed or intended to have, or capable of performing or that without user intent will cause, any of the following functions: (i) disrupting, disabling, harming or otherwise impeding in any manner the operation of, or providing unauthorized access to, any Company Product or any computer or other device on which such Software is stored, installed or used; (ii) damaging or destroying any data or file without the user’s consent; (iii) bypass any technical security measure or masquerade as compliant so as to obtain access to any hardware or Software in contravention of such technical security measures; or (iv) sending information to the applicable Company or Company Subsidiary or any other Person, except to the extent required by applicable Law or Governmental Authority. No Software within the Company Owned IP: (x) constitutes, contains or is considered “spyware” or “trackware” (as such terms are commonly understood in the software industry); (y) records a user’s actions without such user’s knowledge (and, where a user’s consent is required pursuant to applicable Law, without such user’s consent), except to the extent required by applicable Law or Governmental Authority; or (z) gathers or transmits information regarding a user or a user’s behavior, in each case, without such user’s knowledge (and, where a user’s consent is required pursuant to applicable Law, without such user’s consent), except to the extent required by applicable Law or Government Authority.
36
(i) Section 4.19(i) of the Company Disclosure Letter sets forth a complete and accurate list of all Open Source Software that has been used by or for a Company or one of its Subsidiaries and for each such item of Open Source Software: (i) the name and version number of any Company Product(s) in which the Open Source Software has been used and the deployment status of such Company Product(s); (ii) the name of the applicable Open Source Software; (iii) the name of the applicable license to such Open Source Software (including version number); (iv) the manner in which such Open Source Software is used in, incorporated into, linked to, integrated or bundled with the applicable Company Product or Company Owned IP (e.g., embedded, static or dynamic linking, etc.); (v) whether such Open Source Software component was/is used “as is” or has been customized or modified by the Company or any Company Subsidiary; and (vi) the distribution status of the Open Source Software including whether distributed to third parties (e.g., for use on-premises with a third party) or used on a Company-hosted basis. The Company and the Company’s Subsidiaries are in full compliance with all the terms and conditions of all Intellectual Property Agreements for all Open Source Software used with any Company Product or Company Owned IP or in the operations of the Company and, to the knowledge of the Company, the Open Source Software used with any Company Licensed IP is used in full compliance with all the terms and conditions of all Intellectual Property Agreements for all Open Source Software used with any Company Product. The Company and its Subsidiaries have not used and do not use any Open Source Software or any modification or derivative thereof in a manner that, with respect to any of the Company Products or Company Owned IP, would (A) grant to any Person any rights to or immunities for use of any Company Owned IP or any Software within any Company Product, (B) require the disclosure or distribution of any Company Owned IP or any Software within any Company Product in source code form, (C) require licensing of any Company Owned IP or any Software within any Company Product for the purpose of making derivative works of such Company Owned IP or such Software, (D) require that the Company Owned IP or Software within any Company Product be reverse engineerable or (E) impose any restriction on the consideration to be charged for the distribution of any Company Owned IP or Company Product or otherwise obligate the Company or one of its Subsidiaries to make any Company Owned IP or Company Product available free of charge. For the avoidance of doubt, the use of Open Source Software solely under permissive open source licenses (including but not limited to MIT, Apache‑2.0, BSD‑2‑Clause, BSD‑3‑Clause, and ISC) that do not require disclosure of source code or reciprocal licensing of the Company Products or Company Owned IP shall not, by itself, be deemed to violate clauses (A)–(E).
(j) The Company and its Subsidiaries have taken steps that are consistent with generally accepted industry standards, and in any event no less than all commercially reasonable efforts, to protect and maintain the Company Intellectual Property and to protect and preserve the confidentiality of all material Trade Secrets included in the Company Intellectual Property, including requiring all Persons having access such Trade Secrets to execute written confidentiality and non-disclosure Contracts; provided, however, that the Company has not prior to Closing taken any step or made any effort to seek Intellectual Property Registrations relating to the Unregistered Marks, Copyrightable Works or Software. There has not been any unauthorized access, theft, disclosure, use or misappropriation of any Trade Secrets included in the Company Owned IP or any breach of any obligations owned with respect to Trade Secrets within Company Licensed IP.
(k) No funding, grant, facility, resource or personnel of any Governmental Authority or university, academic or educational institution or research institute was used in the development or creation, in whole or in part, of any Company Owned IP, and no Governmental Authority or university, academic or educational institution or research institute has any ownership rights, use rights, Liens or other interest in or to any Company Owned IP.
(l) Neither the Company and its Subsidiaries nor any Person who contributed to the discovery, conception, development, creation, or reduction to practice of any Company Owned IP has ever been a member of, or a contributor to, any industry standards body that requires its members or contributors to grant or offer to any other Person any license or right to any technology or Intellectual Property owned by such members or contributors.
(m) Neither the Company nor its Subsidiaries have transferred ownership of any technology or Intellectual Property to any third Person that was material to the business of the Company at the time it was transferred.
37
(n) Except “gas fees” required for issuing or redeeming stablecoins, neither the Company nor its Subsidiaries have any obligation to compensate any person or entity for the ownership, license, acquisition, design, development, distribution, marketing, use or maintenance of any Company Products. The Company and its Subsidiaries have complied, and have at all times during the last three (3) years complied, to the knowledge of the Company with all applicable Laws relating to the Company’s collection and use of Third Party Data. Neither the Company nor its Subsidiaries have received any written notice of any claims, investigations, or alleged violations of laws, regulations, licenses, or terms of service or use with respect to the use of any Third Party Data.
Section 4.20. Privacy and Cybersecurity.
(a) The Company and its Subsidiaries maintain and are in compliance with, and during the last three (3) years have maintained and been in compliance with, (i) all applicable Privacy Laws (and, all related, legally binding implementing rules, regulations, guidelines and circulars of data privacy regulators implementing or enforcing such Privacy Laws), (ii) the Company’s and its Subsidiaries’ posted or publicly facing privacy policies, and (iii) the Company’s and its Subsidiaries’ contractual obligations concerning Processing, privacy, confidentiality, and/or security of Personal Information; in each case of (i)-(iii) above, other than any non-compliance that, individually or in the aggregate, has not been or would not reasonably be expected to be material to the Company and its Subsidiaries taken as a whole. To the knowledge of the Company, all vendors, processors, and other third parties Processing Personal Information for or on behalf of the Company or any of its Subsidiaries have complied with all Privacy Laws in connection with their Processing of Personal Information for or on behalf of the Company and its Subsidiaries during the last three (3) years, except for any non-compliance that, individually or in the aggregate, has not been or would not reasonably be expected to be material to the Company and its Subsidiaries taken as a whole.
(b) In the past three (3) years, neither the Company nor any of its Subsidiaries have been subject to or received any written notice of any audit, investigation, complaint, or other Action by any Governmental Authority or other Person concerning any Company’s Processing of Personal Information or actual, alleged, or suspected violation of any Privacy Laws. There are no Actions by any Person (including any Governmental Authority) pending to which the Company or any of the Company’s Subsidiaries is a named party or, to the knowledge of the Company, threatened in writing against the Company or its Subsidiaries alleging a violation of any third Person’s privacy or Personal Information rights by the Company or its Subsidiaries in connection with the foregoing, except as would not reasonably be expected to be material to the business of the Company and its Subsidiaries taken as a whole.
(c) (i) During the last three (3) years, there have been, no breaches of the security of the information technology systems of the Company or its Subsidiaries, and (ii) during the last two (2) years, there have been no disruptions in any such information technology systems; in each case, that materially adversely affected the Company’s or its Subsidiaries’ business or operations, taken as a whole, and have not been remedied in all material respects. In the past three (3) years, the Company and its Subsidiaries have regularly performed a vulnerability assessment and obtained an independent penetration testing performed by a recognized third-party audit firm the Companies have used reasonable efforts to address and remediate all material threats and deficiencies identified in each such assessment. The Company has made available to Acquiror true, correct and complete copies of the Company’s data security policies that are currently in effect and material to the Company’s business and all penetration testing reports of the Company produced during the past three (3) years. The Company and its Subsidiaries take commercially reasonable measures (and any other measures required by applicable Law) designed to protect Personal Information in its possession or control against unauthorized access, use, modification, disclosure or other misuse, including through administrative, technical and physical safeguards. Except as would not reasonably be expected to be material to the business of the Company and its Subsidiaries, taken as a whole, during the last three (3) years, neither the Company nor any Subsidiary of the Company has (A) experienced any material incident in which such Personal Information collected or Processed by or on behalf of Company or any of its Subsidiaries was stolen, lost, made unavailable, improperly accessed, used, modified, exfiltrated, altered, erased, destroyed, compromised, or disclosed, in each case without the authorization of the Company or the relevant Subsidiary (as applicable), including in connection with a breach of security (“Security Incident”), or (B) received any written notice or complaint from any Person with respect to any Security Incident.
38
(d) Section 4.20(d) of the Company Disclosure Letter identifies all Company AI. The Company or one of its Subsidiaries either (i) exclusively owns all right, title and interest in and to the Company AI (including all Intellectual Property therein and associated therewith); or (ii) has a current, fully paid up right and license to use, maintain, reproduce, modify or create derivative works of such Company AI therefrom for the purpose of carrying on the business of the Company and its Subsidiaries in all relevant jurisdictions for a period ending no earlier than six (6) months after the date of this Agreement, including use in Company Products, and, to the knowledge of the Company, no facts or circumstances exist that would reasonably be expected to prevent, impair or impede the Company’s or one of its Subsidiaries’ ability to renew such license(s) on substantially similar terms. The Company or one of its Subsidiaries either (i) exclusively owns all right, title and interest in and to all outputs from Company AI; or (ii) has a worldwide, perpetual, irrevocable, transferable, sub-licensable, royalty-free, fully paid up right and license to use, maintain, reproduce, modify or create derivative works of outputs of all Company AI, including use in Company Products. The Company has not: (i) used any Company AI in a manner that has adversely affected, or would reasonably be expected to adversely affect. the ownership, validity, enforceability, registrability, copyrightability or patentability of any material Company Owned IP or material Company Licensed IP or any material content or other material output created by such Company AI that the Company or any of its Subsidiaries intended to maintain as proprietary; or (ii) used any Company AI in a manner that does not, in any material respect, comply with the applicable license or other Contract terms.
(e) The Company owns or has all necessary licenses to use all AI Inputs for the Company AI and all such AI Inputs (whether proprietary to, or licensed by, the Company) have been obtained and used in accordance with the applicable terms, Privacy Laws and AI Laws governing such use (including each end user license agreement, terms of use, privacy policies, consents, or other terms that govern the collection and use of third party data) and in compliance with all required consent and notification obligations under such terms and Laws. The Company has not permitted any Personal Information, Company Data or any Trade Secrets or confidential information of the Company or its customers to be used as AI Inputs for the benefit of third party AI Technology or any other third party technology. To the knowledge of the Company, and subject to any contrary requirements under applicable Law, the Company owns all Intellectual Property in and to any developments, modifications, updates or improvements made to the Company Products resulting from the use of AI data and there are no restrictions on any Company Entity’s ownership, exploitation or commercialization of the Company Products as a result of the use of the AI Inputs.
(f) The Company and the Company AI, are, and have during the last three (3) years been, compliant with all applicable Laws relating to the development, use, deployment, and sale of AI Technology, including the Colorado AI Act and the European Union Artificial Intelligence Act, to the extent such Laws are in force and applicable to the Company’s and its Subsidiaries’ activities related to AI Technology and the Company AI (collectively, “AI Laws”), except for any non-compliance that, individually or in the aggregate, has not been or would not reasonably be expected to be material to the Company and its Subsidiaries taken as a whole. No investigations, claims, or enforcement actions against the Company or user of the Company AI related to compliance with AI Laws are, to the knowledge of the Company, pending, threatened in writing or threatened orally, in each case, by any Governmental Authority or Person.
(g) No Person has made any claim or complaint to the Company in regard to the Company’s or any of its Subsidiaries’ use of Company AI during the last three (3) years.
(h) The use of AI Technology by the Company has not constituted during the last three (3) years, and does not constitute, a breach of any of the Company’s contractual obligations to any of its customers concerning the development, use, deployment, and sale of AI Technology, except as would not reasonably be expected to be material to the business of the Company and its Subsidiaries taken as a whole.
39
Section 4.21. Stablecoins.
(a) The Company and its Subsidiaries are, and for the past three (3) years have been in compliance in all material respects with all applicable Laws in all jurisdictions where they operate relating to the issuance, custody, trading, and transfer of digital assets (including stablecoins), including virtual asset service provider regulations, stablecoin reserve requirements, and anti-money laundering and know-your-customer obligations, as administered or enforced by any relevant Governmental Authority. The Company and its Subsidiaries hold all licenses, registrations, and approvals required under such Laws, except where the failure to hold such licenses, registrations, or approvals would not reasonably be expected to have a material adverse effect on the Company and its Subsidiaries, taken as a whole.
(b) All stablecoins issued by the Company or its Subsidiaries (including the First Digital USD (“FDUSD”)) are, in all material aspects and to the knowledge of the Company, fully backed on a one-to-one basis by reserves comprised of U.S. Treasury bills, overnight repurchase agreements, short-term fixed deposits, cash and/or other high-quality liquid assets) held in accounts or custodial arrangements segregated from operational funds at regulated financial institutions. No security interest, lien or other encumbrance has been granted by the Company or any Subsidiary over any such reserves. Such reserves are, in all material respects, free and clear of all liens, encumbrances, or adverse claims, subject to customary custodial or depository arrangements and liens arising in the ordinary course of custody or holding cash or financial instruments. The reserves supporting any stablecoin issued by the Company or its Subsidiaries have been subject to independent attestation or assurance engagements within the past twelve (12) months by a reputable accounting or assurance firms applying internationally recognized assurance standards. The Company and its Subsidiaries have caused independent attestations or assurance reports covering such reserves to be prepared and published, and provided to Acquiror true, correct, and complete copies of any such reports.
(c) No stablecoin, including FDUSD, has been issued, minted or burned except in accordance with the Company’s or its Subsidiaries’ documented procedures and with all required authorizations. No stablecoin has been issued without corresponding payment or reserve backing in place at the time of issuance, to the knowledge of the Company and in all material aspects. The Company makes no representation or warranty with respect to any transfer or other disposition of stablecoins by any third party following their issuance.
(d) The Company and its Subsidiaries own or have valid licenses to all intellectual property used or held for use in connection with the stablecoin business, including but not limited to all software, smart contracts, and related technology. All smart contracts and blockchain protocols developed or deployed by the Company or its Subsidiaries have been subject to commercially reasonable security audits during the past three (3) years, and, to the knowledge of the Company, contain no material defects, backdoors, or vulnerabilities that would reasonably be expected to adversely affect the security, functionality, or performance of such technology.
(e) All material agreements to which the Company or any of its Subsidiaries is a party relating to the support, listing, or trading of stablecoins (including FDUSD) on third-party platforms, to the knowledge of the Company, are in full force and effect. Neither the Company nor any of its Subsidiaries is in material breach of any such agreement, has received any notice of termination, or has any outstanding unpaid fees or obligations under such agreements.
(f) Neither the Company nor any of its Subsidiaries has received any written notice of, nor, to the knowledge of the Company, is subject to, any pending or, to the knowledge of the Company, threatened investigation, enforcement action, or proceeding by any Governmental Authority relating to digital asset activities, stablecoin issuance, or related financial services. There are no Actions by any Person (including any Governmental Authority) pending to which the Company or any of the Company’s Subsidiaries is a named party or, to the knowledge of the Company, threatened in writing against the Company or its Subsidiaries in connection with the stablecoin business, except as would not reasonably be expected to be material to the business of the Company and its Subsidiaries, taken as a whole.
40
Section 4.22. Environmental Matters. The Company and its Subsidiaries are and, except for matters which have been fully resolved, have been in material compliance with all Environmental Laws and neither the Company nor any of its Subsidiaries is subject to any current Governmental Order relating to any material non-compliance with Environmental Laws, in each case except as would not be or reasonably be expected to be, individually or in the aggregate, material to the business of the Company and its Subsidiaries, taken as a whole. There has been no material release of any Hazardous Materials by the Company or its Subsidiaries at, in, on or under any Leased Real Property or in connection with the Company’s and its Subsidiaries’ operations off-site of the Leased Real Property. No material Legal Proceeding is pending or, to the knowledge of the Company, threatened with respect to the Company’s and its Subsidiaries’ compliance with or liability under Environmental Laws, and, to the knowledge of the Company, there are no facts or circumstances which could reasonably be expected to form the basis of such a Legal Proceeding.
Section 4.23. Absence of Changes. Since the date of the most recent statement of financial position included in the Financial Statements, (i) there has not been any Company Material Adverse Effect; and (ii) except as set forth in Section 4.23 of the Acquiror Disclosure Letter, the Company has, in all material respects, conducted its business and operated its properties in the ordinary course of business consistent with past practice.
Section 4.24. Anti-Corruption Compliance.
(a) Neither the Company nor its Subsidiaries, nor any of their directors or officers, nor to the knowledge of the Company, any of the Company or its Subsidiaries’ respective employees, agents, Representatives or other Persons acting for or on behalf of the Company or any of its Subsidiaries has: (i) made any bribe, influence payment, kickback, payoff, benefits or any other type of payment (whether tangible or intangible) that would be unlawful under any applicable Anti-Bribery Laws; (ii) been in violation of any Anti-Bribery Laws, offered, paid, promised to pay, or authorized any payment or transfer of anything of value, directly or indirectly, to any person for the purpose of (A) influencing any act or decision of any Government Official in his or her official capacity, (B) inducing a Government Official to do or omit to do any act in relation to his or her lawful duty, (C) securing any improper advantage, (D) inducing a Government Official to influence or affect any act, decision or omission of any Governmental Authority, or (E) assisting the Company or any of its Subsidiaries, or any agent or any other Person acting for or on behalf of the Company or any of its Subsidiaries, in obtaining or retaining business for or with, or in directing business to, any Person; or (iii) accepted or received any contributions, payments, gifts, or expenditures that would be unlawful under any Anti-Bribery Laws.
(b) Each of the Company and its Subsidiaries, has instituted and maintains policies and procedures reasonably designed to ensure compliance with the Anti-Bribery Laws.
(c) As of the date hereof, there are no current or pending internal investigations, or, to the knowledge of the Company, any third-party investigations (including by any Governmental Authority), or internal or external audits that address any material allegations concerning possible material violations of the Anti-Bribery Laws related to the Company or any of the Company’s Subsidiaries.
Section 4.25. Anti-Money Laundering, Sanctions and International Trade Compliance.
(a) The Company and its Subsidiaries, and each of their respective directors officers, and to the knowledge of the Company, each of their respective employees, agents, Representatives and other Persons acting on behalf of the Company or any of the Company’s Subsidiaries (i) are, and have been for the past three (3) years, in compliance with all applicable Anti-Money Laundering Laws, Sanctions, and International Trade Laws, and (ii) have obtained all material licenses, consents, notices, waivers, approvals, orders, registrations, declarations, or other authorizations from, and have made any material filings with, any applicable Governmental Authority for all activities and transactions relating to the business operations of the Company or its Subsidiaries, including for the import, export, re-export, deemed export, deemed re-export, or transfer required under the International Trade Laws and Sanctions and the provision of financial services required under Anti-Money Laundering Laws. There are and have for the past three (3) years been no pending or, to the knowledge of the Company, threatened, claims, complaints, charges, investigations, voluntary disclosures or Legal Proceedings against the Company or any of the Company’s Subsidiaries related to violations of Anti-Money Laundering Laws, Sanctions, or International Trade Laws.
41
(b) Neither the Company nor any of its Subsidiaries nor any of their respective directors or officers, nor to the knowledge of the Company, any employees, agents, Representatives or other Persons acting on behalf of the Company or any of the Company’s Subsidiaries, (i) is, or has during the past three (3) years, been a Sanctioned Person or a Restricted Person, or (ii) has transacted business directly or indirectly with any Sanctioned Person or Restricted Person or with or in any Sanctioned Jurisdiction, in each case in violation of applicable Sanctions or International Trade Laws.
(c) The Company and its Subsidiaries have in place policies, procedures, controls, and systems reasonably designed to ensure compliance with all applicable Anti-Money Laundering Laws and Sanctions.
Section 4.26. Proxy/Registration Statement. The information supplied by the Company or any of its Subsidiaries in writing specifically for inclusion in the Proxy/Registration Statement shall not, at (a) the time the Proxy/Registration Statement is filed in accordance with Rule 424(b) of the Securities Act and/or pursuant to Section 14A of the Exchange Act or declared effective, (b) the time the Proxy/Registration Statement (or any amendment thereof or supplement thereto) is first mailed to (i) the Acquiror Shareholders and (ii) the Company Shareholders, and (c) the time of (i) the Acquiror Shareholders’ Meeting and (ii) the Company Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding the foregoing, the Company makes no representation, warranty or covenant with respect to any information supplied by or on behalf of Acquiror, its Affiliates or their respective Representatives on their respective behalf.
Section 4.27. Investment Company. The Company is not an “investment company” or a Person directly or indirectly “controlled” by or acting on behalf of an “investment company,” in each case within the meaning of the Investment Company Act.
Section 4.28. Brokers’ Fees. Except as set forth on Section 4.29 of the Company Disclosure Letter, no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated hereby based upon arrangements made by the Company, any of the Company’s Subsidiaries or any of their Affiliates with respect to which Acquiror or any of its Affiliates, the Company or any of the Company’s Subsidiaries has any obligation.
Section 4.29. No Outside Reliance. Notwithstanding anything contained in this Article IV or any other provision hereof, each of the Company and any of its respective directors, managers, officers, employees, equityholders, partners, members or Representatives, acknowledge and agree that the Company has made its own investigation of Acquiror and that neither Acquiror nor any of its Affiliates, agents or Representatives is making any representation or warranty whatsoever, express or implied, other than those expressly given by Acquiror in Article V, including any implied warranty or representation as to condition, merchantability, suitability or fitness for a particular purpose or trade as to any of the assets of Acquiror. Without limiting the generality of the foregoing, it is understood that any cost estimates, financial or other projections or other predictions that may be provided by Acquiror, as well as any information, documents or other materials (including any such materials reviewed by the Company or its Subsidiaries pursuant to the Confidentiality Agreement) or management presentations that have been or shall hereafter be provided to the Company, its Subsidiaries or any of its or their Affiliates or Representatives are not and will not be deemed to be representations or warranties of Acquiror, and no representation or warranty is made as to the accuracy or completeness of any of the foregoing except as may be expressly set forth in Article V of this Agreement. Except as otherwise expressly set forth in this Agreement, the Company understands and agrees that any assets, properties and business of Acquiror are furnished “as is,” “where is” and subject to and except as otherwise provided in the representations and warranties contained in this Agreement, with all faults and without any other representation or warranty of any nature whatsoever.
42
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF ACQUIROR
Except (a) as set forth in any Acquiror SEC Filings filed or submitted on or prior to the date hereof (excluding (i) any disclosures in any risk factors section that do not constitute statements of fact, any disclosures in any forward-looking statements disclaimer and any other disclosures that are generally cautionary, predictive or forward-looking in nature and (ii) any exhibits or other documents appended thereto) (it being acknowledged that nothing disclosed in such Acquiror SEC Filings will be deemed to modify or qualify the representations and warranties set forth in Section 5.8, Section 5.12 and Section 5.15), (b) as set forth in the disclosure letter delivered by Acquiror to the Company (the “Acquiror Disclosure Letter”) on the date of this Agreement which may be supplemented by Acquiror immediately prior to the Reincorporation Merger Closing (each section of which, subject to Section 12.10, qualifies the correspondingly numbered and lettered representations and warranties in this Article V), and (c) as otherwise explicitly contemplated by this Agreement, the other Transaction Documents or in connection with the Transactions, Acquiror represents and warrants to the Company as of the date hereof, as of the Reincorporation Merger and as of the Acquisition Merger Closing as follows (it being understood that when referring “Acquiror,” it shall be understood that it includes the Surviving Acquiror if the Reincorporation Merger has been completed, to the extent applicable):
Section 5.1. Acquiror Organization. Acquiror has been duly incorporated, formed or organized and is validly existing under the Laws of its jurisdiction of incorporation or organization, and has the requisite company or corporate power, as applicable, and authority to own, lease or operate all of its properties and assets and to conduct its business as it is now being conducted. Acquiror’s Governing Documents, as amended to the date of this Agreement and as previously made available by or on behalf of Acquiror to the Company, are true, correct and complete. Acquiror is duly licensed or qualified and in good standing as a foreign or extra-provincial corporation (or other entity, if applicable) in each jurisdiction in which its ownership of property or the character of its activities is such as to require it to be so licensed or qualified or in good standing, as applicable, except where the failure to be so licensed or qualified or in good standing would not, individually or in the aggregate, have or reasonably be expected to have, an Acquiror Material Adverse Effect.
Section 5.2. Due Authorization.
(a) Other than the Acquiror Shareholders’ Approval, Acquiror has all requisite company or corporate power, as applicable, and authority to execute and deliver this Agreement and the other documents to which it is a party contemplated hereby and (subject to the approvals described in Section 5.7), to consummate the transactions contemplated hereby and thereby and to perform all of its obligations hereunder and thereunder. The execution and delivery of this Agreement and the other documents to which Acquiror is a party contemplated hereby and the consummation of the transactions contemplated hereby and thereby have been (A) duly and validly authorized and approved by the Acquiror Board and (B) determined by the Acquiror Board as advisable to Acquiror and the Acquiror Shareholders and recommended for approval by the Acquiror Shareholders. No other company proceeding on the part of Acquiror is necessary to authorize this Agreement and the documents to which Acquiror is a party contemplated hereby. This Agreement has been, and on or prior to the Reincorporation Merger Closing, the other documents to which Acquiror is a party contemplated hereby will be, duly and validly executed and delivered by Acquiror, and this Agreement constitutes, and on or prior to the Reincorporation Merger Closing, the other documents to which Acquiror is a party contemplated hereby will constitute, a legal, valid and binding obligation of Acquiror, enforceable against Acquiror in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws (currently in effect or enacted following the date hereof) affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity.
43
(b) Assuming that a quorum (as determined pursuant to the Acquiror Charter) is present:
(i) the Transaction Proposal identified in clause (A) of Section 9.2(a)(i) shall require approval by Special Resolution (as defined in the Cayman Companies Act) of the Acquiror Shareholders, which requires an affirmative vote of the holders of at least two-thirds of the Acquiror Ordinary Shares who attend (in person or by proxy) and are entitled to vote and vote (in person or by proxy) thereupon (as determined in accordance with Acquiror’s Governing Documents) at a shareholders’ meeting duly called by the board of directors of Acquiror and held for such purpose; and
(ii) each of those Transaction Proposals identified in clauses (B) to (E) of Section 9.2(a)(i), in each case, shall require approval by an Ordinary Resolution (as defined in the Acquiror Charter), which requires an affirmative vote of the holders of at least a majority of the issued and outstanding Acquiror Ordinary Shares entitled to vote who attend (in person or by proxy) and vote (in person or by proxy) thereupon (as determined in accordance with the Acquiror Charter) at a shareholders’ meeting duly called by the board of directors of Acquiror and held for such purpose,
((i) and (ii) collectively, the “Acquiror Shareholders’ Approval”).
(c) The Acquiror Shareholders’ Approval is the only vote of any of Acquiror’s Shares necessary in connection with entry into this Agreement and the other Transaction Documents by Acquiror and the consummation of the transactions contemplated hereby and thereby, including the Acquisition Merger Closing and the Reincorporation Merger Closing.
(d) On or prior to the date of this Agreement, the Acquiror Board has duly adopted resolutions (i) determining that this Agreement and the other Transaction Documents to which the Acquiror is a party contemplated hereby and the transactions contemplated hereby and thereby are advisable and fair to, and in the best interests of, the Acquiror and its shareholders, as applicable, and (ii) authorizing and approving the execution, delivery and performance by the Acquiror of this Agreement and the other Transaction Documents to which the Acquiror is a party contemplated hereby and the transactions contemplated hereby and thereby. No other corporate action is required on the part of the Acquiror or any of its shareholders to enter into this Agreement or the documents to which the Acquiror is a party contemplated hereby or to approve the Transactions other than the Acquiror Shareholders’ Approval.
(e) At a meeting duly called and held, the Acquiror Board has approved the transactions contemplated by this Agreement as a Business Combination.
Section 5.3. No Conflict. Except as set forth on Section 5.3 of the Acquiror Disclosure Letter, subject to obtaining the Acquiror Shareholders’ Approval, the execution and delivery by Acquiror of this Agreement and the other Transaction Documents to which Acquiror is a party and the consummation of the transactions contemplated hereby and thereby do not and will not (a) violate or conflict with any provision of, or result in the breach of or default under the Governing Documents of Acquiror, (b) violate or conflict with any provision of, or result in the breach of, or default under any applicable Law or Governmental Order applicable to Acquiror, (c) violate or conflict with any provision of, or result in the breach of, result in the loss of any right or benefit, or cause acceleration, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under any Contract to which Acquiror is a party or by which Acquiror may be bound, or terminate or result in the termination of any such Contract or (d) result in the creation of any Lien (other than Permitted Liens) upon any of the properties or assets of Acquiror, except, in the case of clauses (b) through (d), to the extent that the occurrence of the foregoing would not, individually or in the aggregate, have, or reasonably be expected to have, a material adverse effect on the ability of Acquiror to enter into and perform its obligations under this Agreement.
Section 5.4. Litigation and Proceedings. Except as set forth on Section 5.4 of the Acquiror Disclosure Letter, as of the date hereof (a) there are no pending or, to the knowledge of Acquiror, threatened Legal Proceedings against Acquiror or its properties or assets; and (b) there is no outstanding Governmental Order specifically directed at and imposed upon Acquiror or any of its properties or assets, except, in each case, as would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of Acquiror to enter into and perform its obligations under this Agreement; or (ii) be or reasonably be expected to be material to the business of Acquiror.
44
Section 5.5. SEC Filings.
(a) Acquiror has timely filed or furnished all statements, prospectuses, registration statements, forms, schedules, reports and other documents required to be filed by it with the SEC since the IPO, pursuant to the Exchange Act or the Securities Act (collectively, as they have been amended since the time of their filing through the date hereof, the “Acquiror SEC Filings”). Each of the Acquiror SEC Filings, as of the respective date of its filing (or if amended or superseded by a filing prior to the date of this Agreement or the Reincorporation Merger Closing Date, then on the date of such filing), complied in all material respects with the applicable requirements of the Securities Act, the Exchange Act, the Sarbanes-Oxley Act and any rules and regulations promulgated thereunder applicable to the Acquiror SEC Filings. As of the respective date of its filing (or if amended or superseded by a filing prior to the date of this Agreement or the Reincorporation Merger Closing Date, then on the date of such filing), the Acquiror SEC Filings did 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 made therein, in light of the circumstances under which they were made, not misleading. As of the date hereof, there are no outstanding or unresolved comments in comment letters received from the SEC with respect to the Acquiror SEC Filings. To the knowledge of Acquiror, none of the Acquiror SEC Filings filed on or prior to the date hereof is subject to ongoing SEC review or investigation as of the date hereof.
(b) Except to the extent available on the SEC’s website through EDGAR, Acquiror has delivered to the Company copies in the form filed with the SEC of all of the following: (i) Acquiror’s annual reports on Form 10-K for each fiscal year of Acquiror beginning with the first year Acquiror was required to file such a form, (ii) Acquiror’s quarterly reports on Form 10-Q for each fiscal quarter that Acquiror filed such reports to disclose its quarterly financial results in each of the fiscal years of Acquiror referred to in clause (i) above, (iii) all other forms, reports, registration statements, prospectuses and other documents (other than preliminary materials) filed by Acquiror with the SEC since the beginning of the first fiscal year referred to in clause (i) above and (iv) all certifications and statements required by (A) Rules 13a-14 or 15d-14 under the Exchange Act, and (B) 18 U.S.C. §1350 (Section 906 of Sarbanes-Oxley Act) with respect to any report referred to in clause (i) above.
(c) As of the date of this Agreement, (i) the Acquiror Units issued by Acquiror in the IPO are listed on Nasdaq, (ii) Acquiror has not received any written deficiency notice from Nasdaq relating to the continued listing requirements of such Acquiror Units, (iii) there are no Actions pending or, to the knowledge of Acquiror, threatened against Acquiror by the Financial Industry Regulatory Authority with respect to any intention by such entity to suspend, prohibit or terminate the quoting of such Acquiror Units on Nasdaq and (iv) such Acquiror Units are in compliance with all of the applicable corporate governance rules of Nasdaq.
Section 5.6. Internal Controls; Listing; Financial Statements. Except as set forth on Section 5.6 of the Acquiror Disclosure Letter:
(a) except as not required in reliance on exemptions from various reporting requirements by virtue of Acquiror’s status as an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act, Acquiror has established and maintains disclosure controls and procedures (as defined in Rule 13a-15 under the Exchange Act). Such disclosure controls and procedures are designed to (i) ensure that material information relating to Acquiror, including its consolidated Subsidiaries, if any, is made known to Acquiror’s principal executive officer and its principal financial officer by others within those entities, particularly during the periods in which the periodic reports required under the Exchange Act are being prepared; and (ii) be effective in timely alerting Acquiror’s principal executive officer and principal financial officer to material information required to be included in Acquiror’s periodic reports required under the Exchange Act. Acquiror has established and maintained a system of internal controls over financial reporting (as defined in Rule 13a-15 under the Exchange Act) which it reasonably believes is sufficient to provide reasonable assurance regarding the reliability of Acquiror’s financial reporting and the preparation of Acquiror Financial Statements for external purposes in accordance with GAAP;
(b) to the knowledge of Acquiror, each director and executive officer of Acquiror has filed with the SEC on a timely basis all statements required by Section 16(a) of the Exchange Act and the rules and regulations promulgated thereunder;
45
(c) Except as disclosed in the Acquiror SEC Filings, the financial statements of the Acquiror contained in the Acquiror SEC Filings (the “Acquiror Financial Statements”) (i) fairly present in all material respects the financial position of Acquiror, as at the respective dates thereof, and the results of operations, changes in shareholders’ equity, and consolidated cash flows for the respective periods then ended, (ii) were prepared in conformity with GAAP applied on a consistent basis during the periods involved (except as may be indicated therein or in the notes thereto), (iii) comply in all material respects with the applicable accounting requirements and with the rules and regulations of the SEC, the Exchange Act and the Securities Act in effect as of the respective dates thereof, and (iv) prepared in accordance with PCAOB standards. The books and records of Acquiror have been, and are being, maintained in all material respects in accordance with GAAP and any other applicable legal and accounting requirements;
(d) there are no outstanding loans or other extensions of credit made by Acquiror to any executive officer (as defined in Rule 3b-7 under the Exchange Act) or director of Acquiror. Acquiror has not taken any action prohibited by Section 402 of the Sarbanes-Oxley Act; and
(e) except as not required in reliance on exemptions from various reporting requirements by virtue of Acquiror’s status as an “emerging growth company” within the meaning of the Securities Act, as modified by the JOBS Act or as otherwise set forth in the Acquiror SEC Filings, Acquiror maintains systems of internal control over financial reporting that are sufficient to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, including policies and procedures sufficient to provide reasonable assurance: (i) that Acquiror maintains records that in reasonable detail accurately and fairly reflect, in all material respects, its transactions and dispositions of assets; (ii) that transactions are recorded as necessary to permit the preparation of financial statements in conformity with GAAP; (iii) that receipts and expenditures are being made only in accordance with authorizations of management and its board of directors; and (iv) regarding prevention or timely detection of unauthorized acquisition, use or disposition of its assets that could have a material effect on its financial statements. Acquiror has delivered to the Company a true and complete copy (if any) of any disclosure (or, if unwritten, a summary thereof) by any representative of Acquiror to Acquiror’s independent auditors relating to any material weaknesses in internal controls and any significant deficiencies in the design or operation of internal controls that would adversely affect the ability of Acquiror to record, process, summarize and report financial data. Acquiror has no knowledge of any fraud or whistle-blower allegations, whether or not material, that involve management or other employees or consultants who have or had a significant role in the internal control over financial reporting of Acquiror;
(f) neither Acquiror nor any director or officer of Acquiror nor, to the knowledge of Acquiror, any employee of Acquiror, or Acquiror’s independent auditors has identified or been made aware of (i) any significant deficiency or material weakness in the system of internal accounting controls utilized by Acquiror, (ii) any fraud, whether or not material, that involves Acquiror’s management or other employees who have a role in the preparation of financial statements or the internal accounting controls utilized by Acquiror or (iii) any claim or allegation regarding any of the foregoing.
Section 5.7. Governmental Authorities; Consents. Assuming the truth and completeness of the representations and warranties of the Company and the Acquisition Entities contained in this Agreement, no consent, waiver, approval or authorization of, or designation, declaration or filing with, or notification to, any Governmental Authority or other Person is required on the part of Acquiror with respect to Acquiror’s execution or delivery of this Agreement or the consummation of the transactions contemplated hereby, except (a) as otherwise disclosed on Section 5.7 of the Acquiror Disclosure Letter, (b) for the Acquiror Shareholders’ Approval, (c) the filing of the Proxy/Registration Statement with the SEC, other filings with respect to the Transactions pursuant to the applicable state blue sky or other securities Laws, the registration of the Plan of Reincorporation Merger and filing of the related documentation with the Cayman Registrar, the filing of the PubCo Charter with the Cayman Registrar and publication of notification of the Reincorporation Merger in the Cayman Islands Government Gazette, in each case in accordance with the Cayman Companies Act, and (d) for any consents, approvals, authorizations, designations, declarations, waivers or filings, the absence of which would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of Acquiror to enter into and perform its obligations under this Agreement or (ii) be or reasonably be expected to be material to the business of Acquiror.
46
Section 5.8. Trust Account. As of the date of this Agreement, Acquiror has approximately $230,876,657 in a trust account (the “Trust Account”) (including, if applicable, an aggregate of approximately $9,200,000 of deferred underwriting commissions and other fees being held in the Trust Account), such monies held in cash deposit accounts pursuant to the Investment Management Trust Agreement, dated August 26, 2025, between Acquiror and Continental Stock Transfer & Trust Company, as trustee (the “Trustee”) (the “Trust Agreement”). There are no separate Contracts, side letters or other binding arrangements or understandings (whether written or unwritten, express or implied) that would cause the description of the Trust Agreement in the Acquiror SEC Filings to be inaccurate or that would entitle any Person (other than shareholders of Acquiror holding Acquiror Public Shares initially sold in Acquiror’s initial public offering (the “IPO”) who shall have elected to redeem their Acquiror Public Shares pursuant to Acquiror’s Governing Documents and the underwriters of the IPO with respect to deferred underwriting commissions) to any portion of the proceeds in the Trust Account. Prior to the Reincorporation Merger Closing, none of the funds held in the Trust Account may be released other than to pay Taxes and payments with respect to all Acquiror Share Redemptions. There are no claims or proceedings pending or, to the knowledge of Acquiror, threatened with respect to the Trust Account. Acquiror has performed all material obligations required to be performed by it to date under, and is not in default, in breach or delinquent in performance or any other respect (claimed or actual) in connection with, the Trust Agreement, and no event has occurred which, with due notice or lapse of time or both, would constitute such a default or breach thereunder. As of the Reincorporation Merger Effective Time, the obligations of Acquiror to dissolve or liquidate pursuant to Acquiror’s Governing Documents shall terminate, and as of the Reincorporation Merger Effective Time, Acquiror shall have no obligation whatsoever pursuant to Acquiror’s Governing Documents to dissolve and liquidate the assets of Acquiror by reason of the consummation of the transactions contemplated hereby (other than use of the funds in the Trust Account for Acquiror Share Redemptions and to pay the underwriters of the IPO with respect to deferred underwriting commissions). To the knowledge of Acquiror, as of the date hereof, following the Reincorporation Merger Effective Time, no Acquiror Shareholder shall be entitled to receive any amount in the Trust Account except to the extent such Acquiror Shareholder has exercised an Acquiror Share Redemption. As of the date hereof, assuming the accuracy of the representations and warranties of the Company contained herein and the compliance by the Company with its obligations hereunder, Acquiror does not have any reason to believe that any of the conditions to the use of funds in the Trust Account will not be satisfied or funds available in the Trust Account will not be available to Acquiror on the Reincorporation Merger Closing Date (other than use of the funds in the Trust Account for Acquiror Share Redemptions and to pay the underwriters of the IPO with respect to deferred underwriting commissions).
Section 5.9. Investment Company Act; JOBS Act. Acquiror is not an “investment company” or a Person directly or indirectly “controlled” by or acting on behalf of an “investment company,” in each case within the meaning of the Investment Company Act. Acquiror constitutes an “emerging growth company” within the meaning of the JOBS Act.
Section 5.10. Absence of Changes. Since the date of the most recent balance sheet included in the Acquiror SEC Filings, (a) there has not been any Acquiror Material Adverse Event or any event or occurrence that has had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the ability of Acquiror to enter into and perform its obligations under this Agreement, and (b) except as set forth in Section 5.10 of the Acquiror Disclosure Letter, Acquiror has, in all material respects, conducted its business and operated its properties in the ordinary course of business consistent with past practice.
Section 5.11. No Undisclosed Liabilities. Except for any Acquiror Transaction Expenses, there is no other liability, debt or obligation of or claim or judgment against Acquiror (whether direct or indirect, absolute or contingent, accrued or unaccrued, known or unknown, liquidated or unliquidated, or due or to become due), except for liabilities, debts, obligations, claims or judgments (a) set forth on Section 5.11 of the Acquiror Disclosure Letter, (b) reflected or reserved for on the financial statements or disclosed in the notes thereto included in Acquiror SEC Filings, (c) that have arisen since the date of the most recent balance sheet included in the Acquiror SEC Filings in the ordinary course of business of Acquiror, (d) that are executory obligations under any Contract to which Acquiror is a party or by which it is bound incurred in the ordinary course of business consistent with past practice of the Acquiror, (e) arising under this Agreement or any other Transaction Documents, (f) that will be discharged or paid off prior to or at the Reincorporation Merger Closing, or (g) which are not and would not reasonably be expected to be material to Acquiror. As of the date hereof, as of the Reincorporation Merger Closing and the Acquisition Merger Closing, the Acquiror or the Surviving Acquiror (as applicable) is and will be solvent.
47
Section 5.12. Capitalization of Acquiror. Except as set forth on Section 5.12 of the Acquiror Disclosure Letter:
(a) as of the date of this Agreement, the authorized share capital of Acquiror consists of (i) 445,000,000 Acquiror Class A Ordinary Shares, of which 23,891,250 shares are issued and outstanding as of the date of this Agreement (including 23,000,000 Acquiror Public Shares subject to possible redemption, and assuming the separation of all outstanding Acquiror Units into underlying Acquiror Ordinary Shares and Acquiror Warrants), and (ii) 50,000,000 Acquiror Class B Ordinary Shares, of which 7,666,667 shares (i.e. the Founder Shares) are issued and outstanding as of the date of this Agreement. Of the Founder Shares, 7,566,667 Founder Shares are held by the Sponsor. All issued and outstanding Acquiror Ordinary Shares (i) have been duly authorized and validly issued and are fully paid and non-assessable; (ii) have been offered, sold and issued by Acquiror in compliance in all material respects with applicable Law, including federal and state securities Laws, and all requirements set forth in (1) Acquiror’s Governing Documents, and (2) any other applicable Contracts governing the issuance of such securities to which Acquiror is a party or otherwise bound; (iii) are not subject to, nor have they been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of any applicable Law, Acquiror’s Governing Documents or any Contract to which Acquiror is a party or otherwise bound and (iv) were issued free and clear of any Liens (other than Acquiror’s own Lien as provided for in the Acquiror Charter);
(b) as of the date of this Agreement, [11,945,625] Acquiror Warrants are issued and outstanding (assuming the separation of all outstanding Acquiror Units into underlying Acquiror Class A Ordinary Shares and Acquiror Warrants). The Acquiror Warrants are not exercisable until thirty (30) days after the closing of a Business Combination. All outstanding Acquiror Warrants (i) have been duly authorized and validly issued and constitute valid and binding obligations of Acquiror, enforceable against Acquiror in accordance with their terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws (currently in effect or enacted following the date hereof) affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity; (ii) have been offered, sold and issued in compliance in all material respects with applicable Law, including federal and state securities Laws, and all requirements set forth in (1) Acquiror’s Governing Documents and (2) any other applicable Contracts governing the issuance of such securities; (iii) are not subject to, nor have they been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of any applicable Law, Acquiror’s Governing Documents or any Contract to which Acquiror is a party or otherwise bound and (iv) were issued free and clear of any Liens (other than Acquiror’s own Lien as provided for in the Acquiror Charter). Except for the Acquiror’s Governing Documents and this Agreement, there are no outstanding Contracts of Acquiror to repurchase, redeem or otherwise acquire any Acquiror Warrants;
(c) except as set forth in this Section 5.12 or as contemplated by this Agreement or the other documents contemplated hereby, Acquiror has not issued, granted, and is not otherwise bound by or subject to any outstanding subscriptions, options, restricted stock, restricted stock units, share appreciation rights, warrants, rights or other securities (including debt securities) convertible, into or exchangeable or exercisable for Acquiror Ordinary Shares, any other commitments, calls, conversion rights, rights of exchange or privilege (whether preemptive, contractual or by matter of Law), plans or other agreements of any character providing for the issuance of additional shares, the sale of treasury shares or other equity interests, or for the repurchase or redemption of shares or other equity interests of Acquiror or the value of which is determined by reference to shares or other equity interests of Acquiror, and there are no Contracts of any kind which may obligate Acquiror to issue, purchase, redeem or otherwise acquire any of its Acquiror Ordinary Shares; and
(d) Acquiror has no Subsidiaries, and does not own, directly or indirectly, any equity interests or other interests or investments (whether equity or debt) in any Person, whether incorporated or unincorporated. Acquiror is not party to any Contract that obligates Acquiror to invest money in, loan money to or make any capital contribution to any other Person.
48
Section 5.13. Brokers’ Fees. Except as set forth on Section 5.13 of the Acquiror Disclosure Letter, no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated hereby based upon arrangements made by Acquiror or any of its Affiliates, PubCo or Merger Sub.
Section 5.14. Indebtedness. Except as set forth in Section 5.14 of the Acquiror Disclosure Letter or as permitted by Section 8.4 after the date hereof, Acquiror does not have any Indebtedness exceeding $100,000.
Section 5.15. Taxes.
(a) All income Tax Returns and all other material Tax Returns required to be filed by or with respect to Acquiror have been timely filed (taking into account any applicable extensions) and all such Tax Returns (taking into account all amendments thereto) are true, correct and complete in all material respects. All material Taxes due and payable have been fully and timely paid. Section 5.15(a) of the Acquiror Disclosure Letter sets forth each jurisdiction where Acquiror files or is required to file a Tax Return.
(b) Acquiror has withheld from amounts owing to any employee, creditor or other Person all material Taxes required by Law to be withheld, paid over to the proper Governmental Authority in a timely manner all such withheld amounts required to have been so paid over and complied in all material respects with all applicable withholding and related reporting requirements with respect to such Taxes.
(c) There are no Liens for any material Taxes (other than Permitted Liens) upon the property or assets of Acquiror.
(d) No claim, assessment, deficiency or proposed adjustment for any material amount of Tax has been asserted or assessed by any Governmental Authority against Acquiror that remains unpaid.
(e) There is no Tax audit, investigation, examination, or other Action of Acquiror presently in progress, nor has Acquiror been notified of any request or threat for such an audit, investigation, examination, or other Action. There are no waivers, extensions or requests for any waivers or extensions of any statute of limitations currently in effect with respect to any Taxes of Acquiror.
(f) No written claim has been made (or written notification delivered in any form) by any Governmental Authority where Acquiror does not file Tax Returns that it is or may be subject to taxation in that jurisdiction.
(g) Acquiror has not participated in any “listed transaction,” or has failed to disclose a “reportable transaction” in each case as defined in U.S. Treasury Regulation section 1.6011-4(b).
(h) Acquiror has not taken any action or agreed to take any action, nor to the knowledge of Acquiror are there any facts or circumstances, that would reasonably be expected to prevent, impair or impede the Intended Tax Treatment.
(i) Acquiror is not a party to any Tax sharing agreement, Tax indemnification agreement, or Tax allocation agreement.
(j) Acquiror does not have any request for a material closing agreement, private letter ruling, or similar ruling in respect of Taxes pending between Acquiror, on the one hand, and any Tax authority, on the other hand.
(k) Acquiror has not received written notice of any claim from a Tax authority in a jurisdiction in which Acquiror does not file Tax Returns stating that Acquiror is or may be subject to Tax in such jurisdiction.
(l) To the knowledge of Acquiror, there are no facts or circumstances that would reasonably be expected to prevent the Reincorporation Merger from qualifying for the Reincorporation Intended Tax Treatment.
49
Section 5.16. Business Activities. Except as set forth on Section 5.16 of the Acquiror Disclosure Letter:
(a) since formation, Acquiror has not conducted any business activities other than activities related to the IPO or directed toward the accomplishment of a Business Combination. Except as set forth in Acquiror’s Governing Documents or as otherwise contemplated by this Agreement or the other Transaction Documents and the transactions contemplated hereby and thereby, there is no agreement, commitment, or Governmental Order binding upon Acquiror or to which Acquiror is a party which has or would reasonably be expected to have the effect of prohibiting or impairing any business practice of Acquiror or any acquisition of property by Acquiror or the conduct of business by Acquiror as currently conducted or as contemplated to be conducted as of the Reincorporation Merger Closing, other than such effects, individually or in the aggregate, which have not been and would not reasonably be expected to be material to Acquiror;
(b) except for the transactions contemplated by this Agreement and the other Transaction Documents, Acquiror does not own or have a right to acquire, directly or indirectly, any interest or investment (whether equity or debt) in any corporation, partnership, joint venture, business, trust or other entity. Except for this Agreement and the other Transaction Documents and the transactions contemplated hereby and thereby, Acquiror has no material interests, rights, obligations or liabilities with respect to, and is not party to, bound by or have its assets or property subject to, in each case whether directly or indirectly, any Contract or transaction which is, or would reasonably be interpreted as constituting, a Business Combination; and
(c) except for this Agreement and the other Transaction Documents to which Acquiror is a party and the other documents and transactions contemplated hereby and thereby, Acquiror is not as of the date hereof party to any Contract with any other Person that would require payments by Acquiror after the date hereof in excess of $100,000 in the aggregate with respect to any individual Contract (or in the aggregate with any series of related Contracts).
Section 5.17. Nasdaq Stock Market Quotation. The Acquiror Class A Ordinary Shares are registered pursuant to Section 12(b) of the Exchange Act and are listed for trading on the Nasdaq Global Market (“Nasdaq”) under the symbol “KOYN”. The Acquiror Units are registered pursuant to Section 12(b) of the Exchange Act and are listed for trading on the Nasdaq under the symbol “KOYNU”. The Acquiror Warrants are registered pursuant to Section 12(b) of the Exchange Act and are listed for trading on the Nasdaq under the symbol “KOYNW”. Acquiror is in compliance in all material respects with the rules of Nasdaq and there is no Action or proceeding pending or, to the knowledge of Acquiror, threatened against Acquiror by Nasdaq or the SEC with respect to any intention by such entity to deregister the Acquiror Class A Ordinary Shares, the Acquiror Units or the Acquiror Warrants or terminate their listing on Nasdaq. None of Acquiror nor any of its Affiliates or Representatives has taken any action to terminate the registration of the Acquiror Class A Ordinary Shares, the Acquiror Units or the Acquiror Warrants under the Exchange Act except as contemplated by this Agreement or any other Transaction Document.
Section 5.18. Proxy/Registration Statement. Except as set forth on Section 5.18 of the Acquiror Disclosure Letter, the information supplied by Acquiror in writing specifically for inclusion in the Proxy/Registration Statement shall not, at (a) the time the Proxy/Registration Statement is filed in accordance with Rule 424(b) of the Securities Act and/or pursuant to Section 14A of the Exchange Act or declared effective, (b) the time the Proxy/Registration Statement (or any amendment thereof or supplement thereto) is first mailed to (i) the Acquiror Shareholders and (ii) the Company Shareholders, and (c) the time of (i) the Acquiror Shareholders’ Meeting and (ii) the Company Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding the foregoing, Acquiror makes no representation, warranty or covenant with respect to any information supplied by or on behalf of the Company, its Subsidiaries or their respective Representatives on their respective behalf.
Section 5.19. Legal Compliance.
(a) Except as disclosed on Section 5.19(a) of the Acquiror Disclosure Letter or as would not be or reasonably be expected to be material to the Acquiror, Acquiror is in compliance with all applicable Laws in all material respects.
50
(b) Except as disclosed on Section 5.19(b) of the Acquiror Disclosure Letter, in the past three (3) years, Acquiror has not received any written notice of, or been charged with, the violation of any Laws, by any Governmental Authority, except where such violation has not been and would not reasonably be expected to be material to Acquiror.
(c) Acquiror maintains a program of policies, procedures and internal controls reasonably designed and implemented to provide reasonable assurance that violation of applicable Law by any of Acquiror’s directors, officers, or employees, acting on behalf of Acquiror, will be prevented, detected and deterred.
Section 5.20. Anti-Corruption Compliance.
(a) Neither Acquiror, nor any of its directors or officers, nor to the knowledge of Acquiror, any of Acquiror’s employees, agents, Representatives or other Persons acting for or on behalf of Acquiror has: (i) made any bribe, influence payment, kickback, payoff, benefits or any other type of payment (whether tangible or intangible) that would be unlawful under any applicable Anti-Bribery Laws; (ii) been in violation of any Anti-Bribery Laws, offered, paid, promised to pay, or authorized any payment or transfer of anything of value, directly or indirectly, to any person for the purpose of (A) influencing any act or decision of any Government Official in his or her official capacity, (B) inducing a Government Official to do or omit to do any act in relation to his or her lawful duty, (C) securing any improper advantage, (D) inducing a Government Official to influence or affect any act, decision or omission of any Governmental Authority, or (E) assisting Acquiror, or any agent or any other Person acting for or on behalf of Acquiror, in obtaining or retaining business for or with, or in directing business to, any Person; or (iii) accepted or received any contributions, payments, gifts, or expenditures that would be unlawful under any Anti-Bribery Laws.
(b) Acquiror has instituted and maintains policies and procedures reasonably designed to ensure compliance with the Anti-Bribery Laws.
(c) As of the date hereof, there are no current or pending internal investigations, or, to the knowledge of Acquiror, any third-party investigations (including by any Governmental Authority), or internal or external audits that address any material allegations concerning possible material violations of the Anti-Bribery Laws related to Acquiror.
Section 5.21. Anti-Money Laundering, Sanctions and International Trade Compliance.
(a) The Acquiror and its Subsidiaries, and each of their respective directors officers, and to the knowledge of the Acquiror, each of their respective employees, agents, Representatives and other Persons acting on behalf of the Acquiror or any of the Acquiror’s Subsidiaries (i) are, and have been for the past three (3) years, in compliance with all applicable Anti-Money Laundering Laws, Sanctions, and International Trade Laws, and (ii) have obtained all material licenses, consents, notices, waivers, approvals, orders, registrations, declarations, or other authorizations from, and have made any material filings with, any applicable Governmental Authority for all activities and transactions relating to the business operations of the Acquiror or its Subsidiaries, including for the import, export, re-export, deemed export, deemed re-export, or transfer required under the International Trade Laws and Sanctions and the provision of financial services required under Anti-Money Laundering Laws. There are and have for the past three (3) years been no pending or, to the knowledge of the Acquiror, threatened, claims, complaints, charges, investigations, voluntary disclosures or Legal Proceedings against the Acquiror or any of the Acquiror’s Subsidiaries related to violations of Anti-Money Laundering Laws, Sanctions, or International Trade Laws.
(b) Neither Acquiror nor any of its directors or officers, nor to the knowledge of Acquiror, any employees, agents, Representatives or other Persons acting on behalf of Acquiror, (i) is, or has during the past three (3) years, been a Sanctioned Person or a Restricted Person, or (ii) has transacted business directly or indirectly with any Sanctioned Person or Restricted Person or with or in any Sanctioned Jurisdiction, in each case in violation of applicable Sanctions or International Trade Laws.
(c) Acquiror has in place policies, procedures, controls, and systems reasonably designed to ensure compliance with all applicable Anti-Money Laundering Laws and Sanctions.
51
Section 5.22. No Outside Reliance. Notwithstanding anything contained in this Article V or any other provision hereof, each of Acquiror and any of its respective directors, managers, officers, employees, equityholders, partners, members or Representatives, acknowledge and agree that Acquiror has made its own investigation of the Company and that neither the Company nor any of its Affiliates, agents or Representatives is making any representation or warranty whatsoever, express or implied (other than those expressly given by the Company in Article IV), including any implied warranty or representation as to condition, merchantability, suitability or fitness for a particular purpose or trade as to any of the assets of the Company or its Subsidiaries. Without limiting the generality of the foregoing, it is understood that any cost estimates, financial or other projections or other predictions that may be contained or referred to in the Company Disclosure Letter or elsewhere, as well as any information, documents or other materials (including any such materials contained in any “data room” (whether or not accessed by Acquiror or its Representatives) or reviewed by Acquiror pursuant to the Confidentiality Agreement) or management presentations that have been or shall hereafter be provided to Acquiror or any of its Affiliates or Representatives are not and will be deemed not to be representations or warranties of the Company, and no representation or warranty is made as to the accuracy or completeness of any of the foregoing except as may be expressly set forth in Article IV of this Agreement. Except as otherwise expressly set forth in this Agreement, Acquiror understands and agrees that any assets, properties and business of the Company and its Subsidiaries are furnished “as is,” “where is” and subject to and except as otherwise provided in the representations and warranties contained in this Agreement, with all faults and without any other representation or warranty of any nature whatsoever.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF THE ACQUISITION ENTITIES
Each Acquisition Entity represents and warrants to the Company and Acquiror, on behalf of itself only, as of the date hereof (for PubCo only), the date of its respective Joinder Agreement (for the Merger Sub only), the date of the Reincorporation Merger Closing and the date of the Acquisition Merger Closing, as follows (except in the case of Section 6.9 and Section 6.11, which representations and warranties are made solely by PubCo):
Section 6.1. Acquisition Entity Organization. Such Acquisition Entity has been duly incorporated, formed or organized and is validly existing under the Laws of its jurisdiction of incorporation or organization, and has the requisite company or corporate power, as applicable, and authority to own, lease or operate all of its properties and assets and to conduct its business as it is now being conducted. The copies of such Acquisition Entity’s Governing Documents previously delivered by such Acquisition Entity to the Company and Acquiror, are true, correct and complete. Such Acquisition Entity is duly licensed or qualified and in good standing as a foreign or extra-provincial corporation (or other entity, if applicable) in each jurisdiction in which its ownership of property or the character of its activities is such as to require it to be so licensed or qualified or in good standing, as applicable, except where the failure to be so licensed or qualified or in good standing would not, individually or in the aggregate, have, or reasonably be expected to have, a material adverse effect on such Acquisition Entity.
Section 6.2. Due Authorization. Other than the approval by the shareholder of such Acquisition Entity, such Acquisition Entity has all requisite corporate power and authority to (a) execute and deliver this Agreement and the documents contemplated hereby, and (b) consummate the transactions contemplated hereby and thereby and perform all obligations to be performed by it hereunder and thereunder. The execution and delivery of this Agreement and the other documents to which such Acquisition Entity is a party contemplated hereby and the consummation of the transactions contemplated hereby and thereby have been (i) duly and validly authorized and approved by the board of directors of such Acquisition Entity and (ii) determined by the board of directors of such Acquisition Entity as advisable to such Acquisition Entity and such Acquisition Entity’s shareholder and recommended for approval by such Acquisition Entity’s shareholder. No other company proceeding on the part of such Acquisition Entity is necessary to authorize this Agreement and the other documents to which such Acquisition Entity is a party contemplated hereby, other than obtaining the shareholder approval of such Acquisition Entity. This Agreement has been, and at or prior to the Reincorporation Merger Closing, the other documents to which such Acquisition Entity is a party contemplated hereby will be, duly and validly executed and delivered by such Acquisition Entity, and this Agreement constitutes, and at or prior to the Reincorporation Merger Closing, the other documents to which such Acquisition Entity is a party contemplated hereby will constitute, a legal, valid and binding obligation of such Acquisition Entity, enforceable against such Acquisition Entity in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws (currently in effect or enacted following the date hereof) affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity.
52
Section 6.3. No Conflict. Subject to the obtaining of the shareholder approval of such Acquisition Entity, the execution and delivery by such Acquisition Entity of this Agreement and the other documents to which such Acquisition Entity is a party contemplated hereby and the consummation of the transactions contemplated hereby and thereby do not and will not (a) violate or conflict with any provision of, or result in the breach of or default under the Governing Documents of such Acquisition Entity, (b) violate or conflict with any provision of, or result in the breach of, or default under any applicable Law or Governmental Order applicable to such Acquisition Entity, (c) violate or conflict with any provision of, or result in the breach of, result in the loss of any right or benefit, or cause acceleration, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under any Contract to which such Acquisition Entity is a party or by which such Acquisition Entity may be bound, or terminate or result in the termination of any such Contract or (d) result in the creation of any Lien (other than Permitted Liens) upon any of the properties or assets of such Acquisition Entity, except, in the case of clauses (b) through (d), to the extent that the occurrence of the foregoing would not, individually or in the aggregate, have, or reasonably be expected to have, a material adverse effect on the ability of such Acquisition Entity to enter into and perform its obligations under this Agreement.
Section 6.4. Litigation and Proceedings. (a) There are no pending or, to the knowledge of such Acquisition Entity, threatened Legal Proceedings against such Acquisition Entity, its properties or assets; and (b) there is no outstanding Governmental Order specifically directed at and imposed upon such Acquisition Entity, nor are any properties or assets of such Acquisition Entity or its business bound or subject to any Governmental Order, except, in each case, as would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of such Acquisition Entity to enter into and perform its obligations under this Agreement; or (ii) be material to the business of such Acquisition Entity.
Section 6.5. Governmental Authorities; Consents. Assuming the truth and completeness of the respective representations and warranties of the Company and Acquiror contained in this Agreement, no consent, waiver, approval or authorization of, or designation, declaration or filing with, or notification to, any Governmental Authority or other Person is required on the part of such Acquisition Entity with respect to such Acquisition Entity’s execution or delivery of this Agreement or the consummation of the transactions contemplated hereby, except (a) for any consents, approvals, authorizations, designations, declarations, waivers or filings, the absence of which would not, individually or in the aggregate, (i) have, or reasonably be expected to have, a material adverse effect on the ability of such Acquisition Entity to enter into and perform its obligations under this Agreement, or (ii) be or reasonably be expected to be material to the business of the Acquisition Entities (taken as a whole) and (b) the filing of the Proxy/Registration Statement with the SEC, the registration of the Plan of Acquisition Merger, the Plan of Reincorporation Merger and related documentation with the Cayman Registrar and publication of notification of the Mergers in the Cayman Islands Government Gazette, in each case in accordance with the Cayman Companies Act.
Section 6.6. Capitalization of Acquisition Entities.
(a) As of the date of its Joinder Agreement, the authorized share capital of Merger Sub shall be as set forth in the respective Joinder Agreement. As of the date hereof, the authorized share capital of PubCo consists of USD 50,000 divided into 50,000 ordinary shares of USD 1.00 each, of which one (1) ordinary share is issued and allotted. PubCo is a wholly owned subsidiary of the Acquiror. Once incorporated, Merger Sub will be a wholly owned subsidiary of the Acquiror.
(b) All of the issued and outstanding Equity Securities of the respective Acquisition Entities (1) have been duly authorized and validly issued and allotted and are fully paid; (2) have been offered, sold, transferred and issued in compliance with applicable Law, including the Cayman Companies Act and federal and state securities Laws, and all requirements set forth in (A) the Governing Documents of the respective Acquisition Entities and (B) any other applicable Contracts governing the issuance or allotment of such securities to which the relevant Acquisition Entity is a party or otherwise bound; (3) are not subject to, nor have they been issued in violation of, any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of any applicable Law, the Governing Documents of the respective Acquisition Entities or any Contract to which the relevant Acquisition Entity is a party or otherwise bound; and (4) were issued free and clear of any Liens (other than each Acquisition Entity’s own Lien with respect to the issued shares in its capital as provided for in the Governing Documents of the relevant Acquisition Entity). All filings and returns required by applicable Law to be delivered or made by the relevant Acquisition Entity to the relevant authorities in the Cayman Islands or any other jurisdiction in respect of all issuances and transfers of Equity Securities of such relevant Acquisition Entity has been duly and correctly delivered or made on a timely basis.
53
(c) Except as set forth in this Section 6.6 or as contemplated by this Agreement or the other documents to which such Acquisition Entity is a party contemplated hereby, such Acquisition Entity has not granted any outstanding options, warrants, rights or other securities convertible, exercisable or exchangeable for any shares of such Acquisition Entity, or any other commitments or agreements providing for the issuance of additional shares, the sale of treasury shares, for the repurchase or redemption of any shares of such Acquisition Entity or the value of which is determined by reference to the shares of such Acquisition Entity, and there are no Contracts of any kind which may obligate such Acquisition Entity to issue, purchase, redeem or otherwise acquire any shares of such Acquisition Entity.
(d) Other than as contemplated by this Agreement, such Acquisition Entity has no Subsidiaries and does not own, directly or indirectly, any equity interests or other interests or investments (whether equity or debt) in any Person, whether incorporated or unincorporated. Such Acquisition Entity is not party to any Contract that obligates such Acquisition Entity to invest money in, loan money to or make any capital contribution to any other Person.
Section 6.7. Brokers’ Fees. Except for fees described on Section 4.28 of the Company Disclosure Letter or the fees described on Section 5.13 of the Acquiror Disclosure Letter, no broker, finder, investment banker or other Person is entitled to any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated hereby based upon arrangements made by such Acquisition Entity.
Section 6.8. Business Activities. Since formation, such Acquisition Entity has not conducted any business activities other than those directed toward the consummation of the Transactions. Except as set forth in such Acquisition Entity’s Governing Documents or as otherwise contemplated by this Agreement or the other Transaction Documents and the transactions contemplated hereby and thereby, there is no agreement, commitment, or Governmental Order binding upon such Acquisition Entity or to which such Acquisition Entity is a party which has or would reasonably be expected to have the effect of prohibiting or impairing any business practice of such Acquisition Entity or any acquisition of property by such Acquisition Entity or the conduct of business by such Acquisition Entity as currently conducted or as contemplated to be conducted as of the Reincorporation Merger Closing, other than such effects, individually or in the aggregate, which have not been and would not reasonably be expected to be material to such Acquisition Entity.
Section 6.9. PubCo Shares Issued at Closing. The Acquisition Merger Consideration, Reincorporation Merger Consideration and the Founder Transaction Bonus Shares, when issued in accordance with the terms hereof, shall be duly authorized and validly issued and allotted, fully paid and non-assessable and issued or allotted in compliance with all applicable Law, including state and federal securities Laws, and not subject to, and not issued in violation of, any Lien, purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of applicable Law, PubCo’s Governing Documents, or any Contract to which PubCo is a party or otherwise bound.
Section 6.10. Intended Tax Treatment. Such Acquisition Entity has not taken any action or agreed to take any action, nor to the knowledge of such Acquisition Entity are there any facts or circumstances, that could reasonably be expected to prevent, impair or impede the Acquisition Intended Tax Treatment.
Section 6.11. Valid Issuance. The PubCo Ordinary Shares issued pursuant to this Agreement, including the Acquisition Merger Consideration, the Founder Transaction Bonus Shares and the Reincorporation Merger Consideration, when issued in accordance with this Agreement, will be duly authorized and validly issued, and will be fully paid and nonassessable, and free of any Liens (other than Liens under the applicable Laws and in the Organizational Documents).
54
Section 6.12. No Outside Reliance. Notwithstanding anything contained in this Article VI or any other provision hereof, such Acquisition Entity and any of its respective directors, managers, officers, employees, equityholders, partners, members or Representatives, acknowledge and agree that such Acquisition Entity has made its own investigation of Acquiror and the Company and that neither Acquiror, the Company nor any of their respective Affiliates, agents or Representatives is making any representation or warranty whatsoever, express or implied (other than those expressly given by the Company in Article IV and Acquiror in Article V), including any implied warranty or representation as to condition, merchantability, suitability or fitness for a particular purpose or trade as to any of the assets of the Company or Acquiror. Without limiting the generality of the foregoing, it is understood that any cost estimates, financial or other projections or other predictions that may be provided by the Company or Acquiror, as well as any information, documents or other materials or management presentations that have been or shall hereafter be provided to any Acquisition Entity, its Subsidiaries or any of its Affiliates or Representatives are not and will be deemed not to be representations or warranties of the Company or Acquiror, and no representation or warranty is made as to the accuracy or completeness of any of the foregoing except as may be expressly set forth in this Agreement. Except as otherwise expressly set forth in this Agreement, such Acquisition Entity understands and agrees that any assets, properties and business of the Company or Acquiror are furnished “as is,” “where is” and subject to and except as otherwise provided in the representations and warranties contained in Article IV and Article V, with all faults and without any other representation or warranty of any nature whatsoever.
ARTICLE VII
COVENANTS OF THE COMPANY
Section 7.1. Conduct of Business. From the date of this Agreement through the earlier of the Acquisition Merger Closing or valid termination of this Agreement pursuant to Article XI (the “Interim Period”), the Company shall, and the Company shall cause its Subsidiaries to, except (i) as otherwise explicitly contemplated by (w) this Agreement, (x) the other Transaction Documents, (y) the Transactions or (z) subject to the prior written approval of Acquiror, the Transaction Financing Agreements (including the Stablecoin Issuance and/or the issuance of the Collateral Securities), (ii) as required by Law, (iii) as consented to by Acquiror in writing (which consent shall not be unreasonably conditioned, withheld, delayed or denied), or (iv) except as set forth on Section 7.1 of the Company Disclosure Letter, (A) use reasonable best efforts to operate its business in the ordinary course consistent with past practice; (B) comply with its Governing Documents, except solely in the case of any Subsidiary of the Company, where non-compliance by such Subsidiary would not be material to the Transactions or to the business of the Company and its Subsidiaries taken as a whole, and (C) not to take any of the following actions:
(a) change or amend its Governing Documents or the Governing Documents of any of the Company’s Subsidiaries, except changes or amendments as required by the Transactions (including in connection with the Re-domiciliation and Continuation) or, in the case of any of the Company’s Subsidiaries only, for any such amendment which is not material to the Transactions or to the business of the Company and its Subsidiaries, taken as a whole;
(b) make or declare any dividend or distribution to its shareholders or make any other distributions in respect of any of its Equity Securities (other than dividends by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary of the Company);
(c) sell, assign, transfer, convey, lease, exclusively license or otherwise dispose of any of its material tangible assets or properties with a value or purchase price in excess of $400,000 individually or $800,000 in the aggregate, except for (i) dispositions of obsolete or worthless equipment or other tangible assets or properties, (ii) transactions solely among the Company and its wholly-owned Subsidiaries or among its wholly-owned Subsidiaries, and (iii) transactions in the ordinary course of business consistent with past practice (including stablecoin reserve management involving acquisition and disposition of securities);
55
(d) (i) acquire (whether by merger, consolidation, amalgamation, scheme or similar transaction, purchase of securities of or otherwise) any corporation, partnership, association, joint venture or other business organization or division thereof; or (ii) make any acquisition of, or investment in, a business, by purchase of stock, securities or assets, contributions to capital, or loans or advances, in any such case of (i) and (ii) with a value or purchase price in excess of $300,000 individually or $600,000 in the aggregate, other than the ordinary course funding and cash management by the Company or its Subsidiaries of the Company’s Subsidiaries (including stablecoin reserve management involving acquisition and disposition of securities);
(e) issue or sell any debt securities or options, warrants or other rights to acquire any debt securities of the Company or any Subsidiary of the Company or otherwise incur, assume or guarantee or otherwise become liable for any Indebtedness, other than (i) in the case of the Company and its Subsidiaries only, in a principal amount not exceeding $500,000 in aggregate, (ii) subject to Section 8.1, any Company Transaction Expenses, or (iii) borrowings under credit agreements disclosed in Section 7.1(e) of the Company Disclosure Letter, in the form and within the limits that exist on the date hereof;
(f) (i) split or subdivide, combine or consolidate, reclassify, recapitalize or otherwise amend any terms of any shares or series of the Company or any of its Subsidiaries’ Equity Securities, except for any such transaction by a wholly-owned Subsidiary of the Company for its own Equity Securities where such Subsidiary remains a wholly-owned Subsidiary of the Company after consummation of such transaction; or (ii) amend any term or alter any rights of any of its outstanding Equity Securities;
(g) purchase, repurchase, redeem or otherwise acquire any of its issued and outstanding share capital or outstanding Equity Securities or Equity Securities of its Subsidiaries, except for transactions solely among the Company, any wholly-owned Subsidiary of the Company or among wholly-owned Subsidiaries of the Company in any such case for Equity Securities of a wholly-owned Subsidiary of the Company;
(h) (i) make or change any material election in respect of Taxes, (ii) amend, modify or otherwise change any filed material Tax Return, (iii) adopt or request permission of any Tax authority to change any accounting method in respect of material Taxes, (iv) enter into any closing agreement, private letter ruling, or other binding written agreement in respect of material Taxes or enter into any Tax sharing or similar agreement, (v) settle any claim or assessment in respect of material Taxes, (vi) surrender or allow to expire any right to claim a refund of material Taxes, (vii) consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of material Taxes or in respect to any Tax attribute that would give rise to any claim or assessment of Taxes, or (viii) settle any claim, Action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes, or (ix) file any amended Tax Return or claim for refund;
(i) take any action, or knowingly fail to take any action, where such action or failure to act would reasonably be expected to prevent, impair or impede the Intended Tax Treatment;
(j) other than (x) the Collateral Securities and those issued or sold pursuant to any Transaction Financing Agreement or the Stablecoin Issuance or (y) the issuance or transfer of Company Shares to holders of FDG tokens of the Company upon the cancellation of such FDG tokens, (i) issue or sell any of its Equity Securities, any options, warrants, rights of conversion or other rights, agreements, arrangements or commitment obligations to issue, deliver or sell any Equity Securities of the Company, any Subsidiary of the Company, or (ii) amend, waive or modify any terms or rights of or attaching to any Equity Securities of any of them, in each case of the foregoing (i) and (ii), other than issuance of Equity Securities by a Subsidiary of the Company (1) to the Company or a wholly-owned Subsidiary of the Company or (2) on a pro rata basis to all shareholders of such Subsidiary;
(k) adopt a plan of, or otherwise enter into or effect a, complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization or winding up of the Company or any of the Company’s Subsidiaries;
(l) make any material change in its accounting principles or methods unless required by IFRS or applicable Law or, to the extent applicable to the Company or a Subsidiary;
56
(m) other than those employment agreements, indemnification agreements, Contracts covered by any Company Benefit Plan, confidentiality agreements, non-competition agreements or any other agreement of similar nature in each case entered into on arm’s length terms in the ordinary course consistent with past practice with employees, enter into, renew or amend in any material respect or terminate, any Contract with a Company Related Party;
(n) terminate or allow to lapse any insurance policy protecting any of the Company’s assets, unless simultaneously with such termination or lapse, a replacement policy underwritten by an insurance company of nationally recognized standing having comparable deductions and providing coverage equal to or greater than the coverage under the terminated or lapsed policy for substantially similar premiums or less is in full force and effect;
(o) in the case of the Acquisition Entities only, conduct any business activities other than those solely related to the consummation of the Transactions;
(p) enter into, modify in any material respect or terminate (other than expiration in accordance with its terms or termination by the counterparties thereof) any Contract of a type required to be listed on Section 4.12(a) of the Company Disclosure Letter, other than in the ordinary course of business consistent with past practice or as required by Law;
(q) institute, settle or agree to settle any Action before any Governmental Authority, in each case in excess of $200,000 (exclusive of any amounts covered by insurance) or that imposes injunctive or other non-monetary relief on the Company that has a material adverse impact on the activities of the Company;
(r) disclose or agree to disclose to any Person (other than Acquiror or any of its Representatives) any Trade Secret of the Company or any of its Subsidiaries that is material to the business of the Company and its Subsidiaries, taken as a whole, other than (i) to the Group’s own officers, employees, advisors or agents, (ii) in the ordinary course of business consistent with past practice and pursuant to obligations to maintain the confidentiality thereof or (iii) as may be requested by Governmental Authorities;
(s) make or commit to make capital expenditures other than in an amount not in excess of $1,000,000, in the aggregate; and
(t) enter into any agreement to do any action prohibited under this Section 7.1.
Section 7.2. Access to Information. Subject to confidentiality obligations that may be applicable to information furnished to the Company or any of the Company’s Subsidiaries by third parties that may be in the Company’s or any of its Subsidiaries’ possession from time to time, and except for any information that is subject to attorney-client privilege (provided that, to the extent possible, the parties shall cooperate in good faith to permit disclosure of such information in a manner that preserves such privilege or compliance with such confidentiality obligations), and to the extent permitted by applicable Law, the Company shall, and the Company shall cause its Subsidiaries to, afford to Acquiror and its Representatives reasonable access during the Interim Period, during normal business hours and with reasonable advance notice, in such manner as to not materially interfere with the ordinary course of business of the Company and its Subsidiaries taken as a whole, to all of their respective properties, books and records, records and appropriate officers and employees of the Company and the Company’s Subsidiaries as such Representatives may reasonably request for the purposes of and in connection with the Transactions or any Transaction Documents, including information and such other materials and resources relating to any material Legal Proceeding initiated, pending or threatened during the Interim Period. All information obtained by Acquiror or its respective Representatives pursuant to this Section 7.2 shall be subject to the Confidentiality Agreement.
57
Section 7.3. Alternative Proposals. From the date hereof until the Acquisition Merger Closing Date or, if earlier, the termination of this Agreement in accordance with Article XI, the Company shall not (and the Company shall cause its Subsidiaries not to), and none of them shall permit any of their respective Representatives to, (a) solicit, initiate, facilitate or encourage any inquiries, proposals, indications of interest or offers that constitute, or that would reasonably be expected to constitute or lead to, an Alternative Proposal, (b) engage in, continue or otherwise participate in any discussions or negotiations with any third-party regarding an Alternative Proposal, or furnish to any third-party non-public information or provide to any third-party access to the businesses, properties, assets or personnel of the Company or any of its Subsidiaries, in each case for the purpose of encouraging or facilitating an Alternative Proposal, (c) enter into any acquisition agreement, merger agreement or similar definitive agreement, or any letter of intent, memorandum of understanding or agreement in principle, or any other agreement with respect to an Alternative Proposal, or (d) grant any waiver, amendment or release under any confidentiality agreement or otherwise knowingly facilitate any such inquiries, proposals, discussions, or negotiations or any effort or attempt by any Person to make, an Alternative Proposal. From and after the date hereof, the Company shall, and shall direct its Subsidiaries and controlled Affiliates and its and their respective officers, directors and Representatives to, immediately cease and terminate all discussions and negotiations with any Persons (other than Acquiror, Sponsor and their Representatives) with respect to an Alternative Proposal.
Section 7.4. Exchange Listing. From the date of this Agreement through the earlier of Acquisition Merger Closing and termination of this Agreement, PubCo shall apply for, and shall use reasonable best efforts to cause, and the Company shall provide all reasonable assistance reasonably required by PubCo in order for PubCo to cause, the PubCo Class A Ordinary Shares to be issued in connection with the Transactions to be approved for listing on Nasdaq and accepted for clearance by the DTC, subject to official notice of issuance, prior to the Acquisition Merger Closing Date.
Section 7.5. Notice of Developments. From and after the date of this Agreement until the earlier of the Acquisition Merger Closing or the termination of this Agreement in accordance with its terms, the Company shall promptly (and in any event prior to the Acquisition Merger Closing) notify Acquiror in writing, upon the Company or any of the Company’s Subsidiaries, as applicable, becoming aware (awareness being determined with reference to the knowledge of the Company) of: (a) the occurrence or non-occurrence of any event the occurrence or non-occurrence of which has caused or is reasonably likely to cause any condition to the obligations of any party to effect the Transactions not to be satisfied, (b) any material breach of a representation or warranty given by the Company in Article IV or by any Acquisition Entity in Article VI or (c) any notice or other communication from any Governmental Authority which is reasonably likely, individually or in the aggregate, to have an adverse effect in any material respect on the ability of the parties hereto (other than the Acquiror) to consummate the Transactions or to materially delay the timing thereof. The delivery of any notice pursuant to this Section 7.5 shall not cure any breach of any representation or warranty requiring disclosure of such matter or any breach of any covenant, condition or agreement contained in this Agreement or any other Transaction Document or otherwise limit or affect the rights of, or the remedies available to, Acquiror.
Section 7.6. Shareholder Litigation. Without limiting Section 7.1 above: (a) in the event that any litigation related to this Agreement, any other Transaction Document or the transactions contemplated hereby or thereby is brought, or, to the knowledge of the Company, threatened in writing, against the Company or any of its Subsidiaries, or the board of directors of the Company or any of its Subsidiaries, by any Company Shareholders prior to the Acquisition Merger Closing, the Company shall promptly after becoming aware of such litigation notify Acquiror and PubCo of such litigation and keep Acquiror and PubCo reasonably informed with respect to the status thereof; and (b) the Company shall provide Acquiror the opportunity to participate in (at Acquiror’s own cost and expense and subject to a customary joint defense agreement), but not control, the defense of any such litigation, shall consider in good faith Acquiror’s suggestions with respect to such litigation and shall not settle any such litigation without prior written consent of Acquiror, such consent not to be unreasonably withheld, conditioned, delayed or denied.
58
Section 7.7. No Trading. The Company acknowledges and agrees that it is aware, and that its Affiliates have been made aware of the restrictions imposed by U.S. federal securities laws and the rules and regulations of the SEC promulgated thereunder or otherwise and other applicable foreign and domestic Laws on a Person possessing material non-public information about a publicly traded company. The Company hereby agrees that it shall not and shall cause its Subsidiaries not to purchase or sell any securities of Acquiror in violation of such Laws, or cause or encourage any Person to do the foregoing.
Section 7.8. Shareholder Proxies. To the extent required for purposes of obtaining the Company Shareholder Approval, as soon as practicable following the date of this Agreement, the Company shall use commercially reasonable efforts to solicit from its shareholders entitled to vote on the Company Shareholder Approval (other than any Company Shareholder which is a party to the Company Shareholders Support Agreement) the agreement of such shareholders (in a form reasonably satisfactory to Acquiror) to vote (whether pursuant to a duly convened meeting of the shareholders of the Company or to approve by way of a written resolution of the shareholders of the Company) in favor of the Company Shareholder Approval, and/or to appoint individuals designated by the Company as proxies to vote in favor of the Company Shareholder Approval.
Section 7.9. Reference to the Surviving Company. For the purpose of this Article VII and Article IX, when referring “the Company,” it shall be understood that it includes the Surviving Company if the Acquisition Merger has been completed, to the extent applicable.
ARTICLE VIII
COVENANTS OF ACQUIROR
Section 8.1. Trust Account Proceeds and Related Available Equity. Upon satisfaction or waiver of the conditions set forth in Article X and provision of notice thereof to the Trustee (which notice shall be provided by Acquiror to the Trustee in accordance with the terms of the Trust Agreement), (a) in accordance with and pursuant to the Trust Agreement, at the Acquisition Merger Closing, Acquiror shall (i) cause any documents, opinions and notices required to be delivered to the Trustee pursuant to the Trust Agreement to be so delivered and (ii) use its reasonable best efforts to cause the Trustee to, and the Trustee shall thereupon be obligated to (1) pay as and when due all amounts payable to Acquiror Shareholders pursuant to the Acquiror Share Redemptions and pay to the underwriters of the IPO all outstanding deferred underwriting commissions, (2) pay all accrued and unpaid Company Transaction Expenses as set forth on a written statement to be delivered to PubCo by or on behalf of the Company, not less than two (2) Business Days prior to the Acquisition Merger Closing Date, which shall include the respective amounts and wire transfers instructions for the payment thereof, provided that the amount of such aggregate accrued and unpaid Company Transaction Expenses shall not to exceed $4,500,000, and any Company Transaction Expenses in excess of such amount shall result in an automatic reduction in the Company Valuation on a dollar for dollar basis, (3) pay all accrued and unpaid Acquiror Transaction Expenses, as set forth on a written statement to be delivered to PubCo by or on behalf of Acquiror, not less than two (2) Business Days prior to the Acquisition Merger Closing Date, which shall include the respective amounts and wire transfers instructions for the payment thereof, provided that the amount of such aggregate accrued and unpaid Acquiror Transaction Expenses shall not to exceed the Acquiror Transaction Expense Cap and any Acquiror Transaction Expenses in excess of such amount shall result in an automatic increase in the Company Valuation on a dollar for dollar basis and (4) after the deductions contemplated in (1), (2) and (3), pay all remaining amounts then available in the Trust Account (if any) (the “Remaining Trust Fund Proceeds”) to a bank account designated by the Surviving Company for its immediate use, subject to this Agreement and the Trust Agreement, and (b) thereafter, the Trust Agreement shall terminate, except as otherwise provided therein. If a bank account of PubCo or any of its Subsidiaries is designated by the Surviving Acquiror under Section 8.1(ii)(4), the payment of the Remaining Trust Fund Proceeds to such bank account may be treated as (i) an advance from the Surviving Company to PubCo or such Subsidiary of PubCo, or (ii) a dividend from the Surviving Company to PubCo, in each case, as determined by the Surviving Company in its sole discretion, subject to applicable Laws.
Section 8.2. Nasdaq Listing. From the date of this Agreement through the Acquisition Merger Effective Time, Acquiror shall use its reasonable best efforts to ensure Acquiror or the Surviving Acquiror (as applicable) remains listed as a public company on Nasdaq.
59
Section 8.3. No Solicitation by Acquiror. From the date hereof until the Acquisition Merger Closing Date or, if earlier, the termination of this Agreement in accordance with Article XI, Acquiror shall not, and shall direct the Sponsor, the Acquisition Entities, their respective Affiliates, and their respective officers, directors and Representatives not to, directly or indirectly (a) solicit, initiate, facilitate or encourage any inquiries, proposals, indications of interest or offers that constitute, or that would reasonably be expected to constitute or lead to, an Acquiror Acquisition Proposal, (b) engage in, continue or otherwise participate in any discussions or negotiations with any third-party regarding an Acquiror Acquisition Proposal, or furnish to any third-party non-public information or provide to any third-party access to the businesses, properties, assets or personnel of Acquiror, in each case for the purpose of encouraging or facilitating an Acquiror Acquisition Proposal, (c) enter into any acquisition agreement, merger agreement or similar definitive agreement, or any letter of intent, memorandum of understanding or agreement in principle, or any other agreement with respect to an Acquiror Acquisition Proposal, or (d) grant any waiver, amendment or release under any confidentiality agreement or otherwise knowingly facilitate any such inquiries, proposals, discussions, or negotiations or any effort or attempt by any Person to make, an Acquiror Acquisition Proposal. From and after the date hereof, Acquiror shall, and shall direct the Sponsor, the Acquisition Entities, their respective Affiliates, and their respective officers, directors and Representatives to, immediately cease and terminate all discussions and negotiations with any Persons (other than the Company and its Representatives) with respect to an Acquiror Acquisition Proposal. Notwithstanding the foregoing but subject to Section 12.14, nothing else in this Agreement shall prohibit Acquiror, or the Acquiror Board from making any legally required disclosure, including legally required disclosure of factual information regarding the business, financial condition or results of operations of Acquiror.
Section 8.4. Acquiror Conduct of Business. During the Interim Period, Acquiror shall, and shall cause the Acquisition Entities to, except (i) as otherwise explicitly contemplated by this Agreement or the other Transaction Documents, (ii) as required by Law, (iii) as consented to by the Company in writing (which consent shall not be unreasonably conditioned, withheld, delayed or denied) or (iv) as set forth in Section 8.4 of the Acquiror Disclosure Letter, (A) use reasonable best efforts to operate its business in the ordinary course consistent with past practice and (B) comply in all material respects with its Governing Documents. Without limiting the generality of the foregoing, except as set forth in Section 8.4 of the Acquiror Disclosure Letter or as consented to by the Company in writing (which consent shall not be unreasonably conditioned, withheld, delayed or denied), Acquiror shall not, and shall cause the Acquisition Entities not to, except as otherwise contemplated by this Agreement or the other Transaction Documents or as required by Law:
(a) to change, modify or amend the Trust Agreement or the Governing Documents of Acquiror (or to seek any approval from the Acquiror Shareholders) or the Acquisition Entities, except as contemplated by the Transaction Proposals;
(b) merge, consolidate or amalgamate with or into, invest in, or acquire (by purchasing a substantial portion of the assets of or equity in, or by any other manner) any other Person or be acquired by any other Person;
(c) (i) make or declare any dividend or distribution to its shareholders or make any other distributions in respect of any of its Equity Securities, (ii) split or subdivided, combine, consolidate, recapitalize reclassify or otherwise amend any terms of its Equity Securities, or (iii) purchase, repurchase, redeem or otherwise acquire any of its issued and outstanding Equity Securities of the Acquiror or any Acquisition Entity, other than redemptions of Acquiror Public Shares made as part of the Acquiror Share Redemptions and as contemplated in Section 8.11;
(d) (i) make or change any material election in respect of Taxes, (ii) amend, modify or otherwise change any filed material Tax Return, (iii) adopt or request permission of any Tax authority to change any accounting method in respect of material Taxes, (iv) enter into any closing agreement, private letter ruling, or other binding written agreement in respect of material Taxes or enter into any Tax sharing or similar agreement, (v) settle any claim or assessment in respect of material Taxes, (vi) surrender or allow to expire any right to claim a refund of material Taxes, (vii) consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of material Taxes or in respect to any Tax attribute that would give rise to any claim or assessment of Taxes, or (viii) settle any claim, Action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes, or (ix) file any amended Tax Return or claim for refund;
60
(e) take any action, or knowingly fail to take any action, where such action or failure to act would reasonably be expected to prevent, impair or impede the Intended Tax Treatment;
(f) other than as expressly required or contemplated by the Sponsor Support Agreement or any other Transaction Document, enter into, renew or amend in any material respect or terminate, any Contract with Sponsor or an Affiliate of Acquiror (including (i) any Person in which the Sponsor or any Affiliate of Acquiror has a direct or indirect legal or beneficial ownership interest of five percent (5%) or more, (ii) any Person who has a direct or indirect legal or beneficial ownership interest of five percent (5%) or more in the Sponsor or any Affiliate of Acquiror and (iii) any director or officer of Acquiror, the Sponsor or the Persons set forth in the foregoing (i) and (ii) or any immediate family member of the foregoing Persons), other than any Contract relating to any Contract relating to the non-redemption of Acquiror Ordinary Shares or any other Contract set out in Section 8.4(f) of the Acquiror Disclosure Letter;
(g) issue or sell any debt securities or options, warrants or other rights to acquire any debt securities of the Acquiror or the Acquisition Entities or otherwise incur, assume, guarantee or otherwise become liable for any Indebtedness, in each case other than (i) liabilities incurred in the ordinary course of business and in an amount, individually or in the aggregate, not to exceed $100,000, (ii) any Acquiror Transaction Expenses in an aggregate amount not exceeding USD4,500,000, or (iii) other Indebtedness as set out in Section 8.4(g) of the Acquiror Disclosure Letter;
(h) (i) issue or sell any Equity Securities or securities exercisable for or convertible into Equity Securities (other than issuances of Acquiror Ordinary Shares issuable upon, or subject to, the exercise or settlement of the Acquiror Warrants), (ii) grant any options, warrants or other equity-based awards with respect to any Equity Securities not outstanding on the date hereof, or (iii) other than pursuant to or as contemplated by the Transaction Documents, amend, modify or waive any of the material terms or rights of or attaching to any Equity Securities of Acquiror (including those set forth in any Acquiror Warrant or the Acquiror Warrant Agreement), including any amendment, modification or reduction of the warrant price set forth therein;
(i) adopt a plan of, or otherwise enter into or effect a liquidation, dissolution, restructuring, recapitalization or other reorganization or winding up of the Acquiror or the Acquisition Entities;
(j) make or commit to make capital expenditures other than in an amount not in excess of $100,000 in the aggregate;
(k) make any material change in its accounting principles or methods unless required by GAAP or applicable Law or, to the extent applicable to Acquiror or the Acquisition Entities;
(l) form any direct or indirect Subsidiary (other than the formation of PubCo and Merger Sub);
(m) institute, settle or agree to settle any Action before any Governmental Authority, in each case in excess of $200,000 (exclusive of any amounts covered by insurance) or that imposes injunctive or other non-monetary relief on Acquiror or the Acquisition Entities that has a material adverse impact on the activities of Acquiror or the Acquisition Entities;
(n) enter into any agreement to do any action prohibited under this Section 8.4.
Section 8.5. Acquiror Public Filings. From the date hereof through the Acquisition Merger Effective Time, Acquiror or the Surviving Acquiror (as applicable) will use reasonable efforts to keep current and timely file all reports required to be filed or furnished with the SEC and otherwise comply in all material respects with its reporting obligations under applicable Laws.
61
Section 8.6. Shareholder Litigation. Without limiting Section 8.4 above, in the event that any litigation related to this Agreement, any other Transaction Document or the transactions contemplated hereby or thereby is brought, or, to the knowledge of Acquiror, threatened in writing, against Acquiror or the board of directors of Acquiror by any Acquiror Shareholders prior to the Acquisition Merger Closing, Acquiror or the Surviving Acquiror (as applicable) shall promptly after becoming aware of such litigation notify the Company of any such litigation and keep the Company reasonably informed with respect to the status thereof. Acquiror or the Surviving Acquiror (as applicable) shall provide the Company the opportunity to participate in (at its own cost and subject to a customary joint defense agreement), but not control, the defense of any such litigation, and shall consider in good faith the Company’s suggestions with respect to such litigation and shall not settle any such litigation without the prior written consent of the Company, such consent not to be unreasonably withheld, conditioned, delayed or denied.
Section 8.7. Section 16 Matters. Prior to the Acquisition Merger Closing Date, Acquiror or the Surviving Acquiror (as applicable) shall take all such steps (to the extent permitted under applicable Law) as are reasonably necessary to cause any acquisition or disposition of PubCo Ordinary Shares or any derivative thereof that occurs or is deemed to occur by reason of or pursuant to the Transactions by each Person who is or will be or may become subject to Section 16 of the Exchange Act with respect to PubCo, including by virtue of being deemed a director by deputization, to be exempt under Rule 16b-3 promulgated under the Exchange Act.
Section 8.8. Notice of Developments. From and after the date of this Agreement until the earlier of the Acquisition Merger Closing or the termination of this Agreement in accordance with its terms, Acquiror shall promptly (and in any event prior to the Acquisition Merger Closing) notify the Company in writing, upon Acquiror becoming aware (awareness being determined with reference to the knowledge of Acquiror) of: (a) the occurrence or non-occurrence of any event the occurrence or non-occurrence of which has caused or is reasonably likely to cause any condition to the obligations of any party to effect the Transactions not to be satisfied, (b) any material breach of a representation or warranty given by Acquiror in Article V or (c) any notice or other communication from any Governmental Authority which is reasonably likely, individually or in the aggregate, to have an adverse effect in any material respect on the ability of the parties hereto (other than the Company or the Acquisition Entities) to consummate the Transactions or to materially delay the timing thereof. The delivery of any notice pursuant to this Section 8.8 shall not cure any breach of any representation or warranty requiring disclosure of such matter or any breach of any covenant, condition or agreement contained in this Agreement or any other Transaction Document or otherwise limit or affect the rights of, or the remedies available to, the Company or the Acquisition Entities.
Section 8.9. Access to Information. Subject to confidentiality obligations that may be applicable to information furnished to Acquiror by third parties that may be in Acquiror’s possession from time to time, and except for any information that is subject to attorney-client privilege (provided that, to the extent possible, the parties shall cooperate in good faith to permit disclosure of such information in a manner that preserves such privilege or compliance with such confidentiality obligations), and to the extent permitted by applicable Law, Acquiror shall afford to the Company and its Representatives reasonable access during the Interim Period, during normal business hours and with reasonable advance notice, in such manner as to not materially interfere with the ordinary course of business of Acquiror, to all of their respective properties, books and records, records and appropriate officers and employees of Acquiror as such Representatives may reasonably request for the purposes of and in connection with the Transactions or any Transaction Documents, including information and such other materials and resources relating to any material Legal Proceeding initiated, pending or threatened during the Interim Period.
Section 8.10. Reference to the Surviving Acquiror. For the purpose of this Article VIII and Article IX, when referring “Acquiror,” it shall be understood that it includes the Surviving Acquiror if the Reincorporation Merger has been completed, to the extent applicable.
62
Section 8.11. Sponsor Share Restructuring. As of immediately prior to the Acquisition Merger Effective Time, the Sponsor and PubCo shall enter into a sponsor share restructuring agreement in form and substance reasonably agreeable to the Sponsor and the Company (the “Sponsor Share Restructuring Agreement”), providing for the following:
(a) 1,891,667 Sponsor PubCo Shares (or a quarter of the Sponsor PubCo Shares that Founder Shares held by the Sponsor will be exchanged for at the Reincorporation Merger Effective Time pursuant to Section 3.1(a)) shall be forfeited at the Acquisition Merger Effective Time in exchange for a warrant to purchase (i) 1,891,667 PubCo Class A Ordinary Shares plus (ii) PubCo Class A Ordinary Shares in an amount equal to the Remaining Working Capital Warrant Coverage, substantially in the form attached hereto as Exhibit F (the “Sponsor Warrant”). The PubCo Class A Ordinary Shares issuable upon exercise of the Sponsor Warrant shall be Registrable Securities (as defined in the Registration Rights Agreement) and shall be registered for resale along with the other securities contemplated by the Registration Rights Agreement in accordance with the terms thereof; and
(b) At the Acquisition Merger Effective Time, 1,891,667 Sponsor PubCo Shares shall be directly deposited into escrow by PubCo with an escrow agent mutually agreed by the Sponsor and PubCo (the “Sponsor Escrow Shares”) in accordance with an escrow agreement in form and substance reasonably satisfactory to the Sponsor and the Company (the “Escrow Agreement”), and shall not be forfeited at such time. The Sponsor Escrow Shares shall be allocated pro-rata to the percentage of shares issued to the Company Founder among three tranches corresponding to the milestones set forth in Schedule 1 (Earn-Out Summary). Upon achievement of a milestone in accordance with Schedule 1 (Earn-Out Summary), the corresponding tranche of the Sponsor Escrow Shares shall be promptly released from escrow to the Sponsor or its affiliates. Any Sponsor Escrow Shares corresponding to a milestone that is not achieved by the end of the ten-year period set forth in Schedule 1 (Earn-Out Summary) shall be automatically forfeited to PubCo for no consideration and cancelled. During the period in which the Sponsor Escrow Shares are held in escrow, none of the escrow agent, the Sponsor or any other Person shall Transfer any Sponsor Escrow Shares then held in escrow; provided that the Sponsor shall be entitled to exercise or direct the escrow agent to exercise all voting rights in respect of such Sponsor Escrow Shares at any meeting of shareholders of PubCo or by written consent, and any dividend or distribution in respect of such Sponsor Escrow Shares shall accrue and be placed into the escrow and shall only be released together with the corresponding Sponsor Escrow Shares when the corresponding Sponsor Escrow Shares are released to the Sponsor (or, if such Sponsor Escrow Shares are forfeited to PubCo, the corresponding dividend or distribution shall be forfeited and returned to PubCo). The terms of the earn-out and escrow (including the voting of the Sponsor Escrow Shares) shall be set forth in the Sponsor Share Restructuring Agreement and the Escrow Agreement. The adjustment, clawback and sale-of-company provisions set forth in Schedule 1 (Earn-Out Summary) shall apply to the Sponsor Escrow Shares.
ARTICLE IX
JOINT COVENANTS
Section 9.1. Regulatory Approvals; Other Filings.
(a) Each of the Company, PubCo, Acquiror and Merger Sub shall use its commercially reasonable efforts to cooperate in good faith with any Governmental Authority and use its commercially reasonable efforts to undertake promptly any and all action required to obtain those regulatory approvals, consents, Actions, nonactions or waivers, and to provide any necessary or advisable regulatory notifications in connection with the Transactions (if any) (the “Regulatory Approvals”) as soon as reasonably practicable and any and all action necessary to consummate the Transactions as contemplated hereby. Each of the Company, PubCo, Acquiror and Merger Sub shall use commercially reasonable efforts to cause the expiration or termination of the waiting, notice or review periods under any applicable Regulatory Approval with respect to the Transactions as promptly as reasonably possible after the execution of this Agreement.
63
(b) With respect to each of the above filings, and any other requests, inquiries, Actions or other proceedings by or from Governmental Authorities, each of the Company, PubCo, Merger Sub and Acquiror shall (and, to the extent required, shall cause its controlled Affiliates to) (i) diligently and expeditiously defend and use reasonable best efforts to obtain any necessary clearance, approval, consent, or Governmental Authorization and to provide any necessary or advisable regulatory notifications under Laws prescribed or enforceable by any Governmental Authority for the transactions contemplated by this Agreement and to resolve any objections as may be asserted by any Governmental Authority with respect to the transactions contemplated by this Agreement; and (ii) cooperate in good faith with each other in the defense of such matters. To the extent not prohibited by Law, the Company shall (and the Company shall cause its Subsidiaries to) promptly furnish to Acquiror, and Acquiror and the Acquisition Entities shall promptly furnish to the Company, copies of any notices or written communications received by such party or any of its Affiliates from any third party or any Governmental Authority with respect to the transactions contemplated hereby, and each party shall permit counsel to the other parties an opportunity to review in advance, and each party shall consider in good faith the views of such counsel in connection with, any proposed written communications by such party and/or its Affiliates to any Governmental Authority concerning the transactions contemplated hereby; provided that none of the parties shall extend any waiting period or comparable period or enter into any agreement with any Governmental Authority without the written consent of the other parties. To the extent not prohibited by Law, the Company agrees to provide Acquiror and its counsel, and Acquiror agrees to provide the Company and its counsel, the opportunity, on reasonable advance notice, to participate in any substantive meetings or discussions, either in person or by telephone, between such party and/or any of its Affiliates, their respective agents or advisors, on the one hand, and any Governmental Authority, on the other hand, concerning or in connection with the transactions contemplated hereby.
(c) Subject to Section 12.6, the Company, on the one hand, and Acquiror, on the other, shall each be responsible for and pay one-half of the cost for the preparation, filing and other related fees in connection with the Regulatory Approvals.
(d) Notwithstanding the foregoing, nothing in this Agreement shall require, or be construed to require, the Company or any of its Affiliates to agree to (i) sell, hold, divest, discontinue or limit, before or after the Acquisition Merger Closing Date, any assets, businesses or interests of the Company or any of its Affiliates; (ii) any conditions relating to, or changes or restrictions in, the operations of any such assets, businesses or interests which, in either case, could reasonably be expected to result in a Company Material Adverse Effect or materially and adversely impact the economic or business benefits to the Company of the transactions contemplated by this Agreement; or (iii) any material modification or waiver of the terms and conditions of this Agreement.
Section 9.2. Proxy/Registration Statement; Acquiror Shareholders’ Meeting and Approvals; Company Shareholders’ Meeting and Approvals.
(a) Proxy/Registration Statement and Prospectus.
(i) As promptly as reasonably practicable after the execution of this Agreement, the Company, PubCo and Acquiror shall prepare, and PubCo and the Company shall, as co-registrants, jointly file with the SEC, a registration statement on Form F-4 (as amended or supplemented from time to time, and including a proxy statement and prospectus, the “Proxy/Registration Statement”) among other things, registering the PubCo Ordinary Shares and PubCo Warrants issuable to the Acquiror Shareholders and the Company Shareholders pursuant to this Agreement and the PubCo Ordinary Shares issuable to the Binance Warrantholder pursuant the Binance PubCo Warrant and the PubCo Ordinary Shares issuable to Noble Elite pursuant to the Noble Elite PubCo Warrant, and relating to the Acquiror Shareholders’ Meeting to approve and adopt: (A) the Reincorporation Merger and the Plan of Reincorporation Merger and the Acquisition Merger and the Plan of Acquisition Merger, (B) the approval of the PubCo Equity Incentive Plan, (C) the approval of the Founder Earn-Out Agreement, (D) this Agreement, the other Transaction Documents and the Business Combination, (E) the adjournment of the Acquiror Shareholders’ Meeting, if necessary, to permit further solicitation of proxies because there are not sufficient votes to approve and adopt any of the foregoing or any proposal in (F), and (F) any other proposals as the SEC (or staff member thereof) indicates are necessary in its comments to the Proxy/Registration Statement or correspondence related thereto and any other proposals required to be approved by the shareholders of Acquiror in order for the transactions contemplated hereby to be consummated (such proposals in (A) through (F), collectively, the “Transaction Proposals”).
64
(ii) Acquiror, PubCo and the Company shall (and the Company shall cause each of its Subsidiaries to) each use its commercially reasonable efforts to (1) cause the Proxy/Registration Statement when filed with the SEC to comply in all material respects with all Laws applicable thereto and rules and regulations promulgated by the SEC, (2) respond as promptly as reasonably practicable to and resolve all comments received from the SEC concerning the Proxy/Registration Statement, (3) cause the Proxy/Registration Statement to be declared effective under the Securities Act as promptly as practicable and (4) keep the Proxy/Registration Statement effective as long as is necessary to consummate the Transactions. Prior to the effective date of the Proxy/Registration Statement, the Company, PubCo and Acquiror shall (and shall cause each of its Subsidiaries to) use its commercially reasonable efforts to take all or any action required under any applicable federal or state securities Laws in connection with the issuance of PubCo Ordinary Shares pursuant to this Agreement. Each of the Company, PubCo and Acquiror also agrees to (and shall cause each of its Subsidiaries to) use its commercially reasonable efforts to obtain all necessary state securities law or “Blue Sky” permits and approvals required to carry out the Transactions, and the Company shall furnish all information concerning the Company and its Subsidiaries, and any of their respective members or shareholders as may be reasonably requested in connection with any such action.
(iii) As promptly as reasonably practicable after finalization and effectiveness of the Proxy/Registration Statement, unless otherwise mutually agreed by the Company and Acquiror, Acquiror shall use reasonable best efforts to within ten (10) Business Days thereof, mail the Proxy/Registration Statement to the Acquiror Shareholders. Each of Acquiror, PubCo and the Company shall furnish to the other parties all information concerning itself, its Subsidiaries, officers, directors, managers, shareholders, and other equityholders and information regarding such other matters as may be reasonably necessary or advisable or as may be reasonably requested in connection with the Proxy/Registration Statement, or any other statement, filing, notice or application made by or on behalf of Acquiror, PubCo, the Company or their respective Affiliates to any regulatory authority (including Nasdaq) in connection with the Transactions.
(iv) Subject to Section 12.6, the Company, on the one hand, and Acquiror, on the other, shall each be responsible for and pay one-half of the cost for the preparation, filing and mailing of the Proxy/Registration Statement and other related fees.
(v) Any filing of, or amendment or supplement to, the Proxy/Registration Statement will be mutually prepared and agreed upon by Acquiror, PubCo and the Company. PubCo will advise the Company and Acquiror, promptly after receiving notice thereof, of the time when the Proxy/Registration Statement has become effective or any supplement or amendment has been filed, of the issuance of any stop order, of the suspension of the qualification of any PubCo Ordinary Shares and PubCo Warrants to be issued or issuable in connection with this Agreement (or upon exercise of any PubCo Warrants) for offering or sale in any jurisdiction, or of any request by the SEC for amendment of the Proxy/Registration Statement or comments thereon and responses thereto or requests by the SEC for additional information and responses thereto, and shall provide the Company or Acquiror (as applicable) a reasonable opportunity to provide comments and amendments to any such filing. Acquiror, PubCo and the Company shall cooperate and mutually agree upon (such agreement not to be unreasonably withheld or delayed) any response to comments of the SEC or its staff with respect to the Proxy/Registration Statement and any amendment to the Proxy/Registration Statement filed in response thereto.
(vi) Each of Acquiror, PubCo and the Company shall ensure that none of the information supplied by it or its Subsidiaries or on its behalf for inclusion or incorporation by reference in (A) the Proxy/Registration Statement will, at the time the Proxy/Registration Statement is filed with the SEC, at each time at which it is amended and at the time it becomes effective under the Securities Act, 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 or (B) the Proxy/Registration Statement will, at the date it is first mailed to the Acquiror Shareholders and at the time of the Acquiror Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading.
(vii) If at any time prior to the Acquisition Merger Effective Time the Company, PubCo or Acquiror becomes aware that any information relating to the Company, PubCo, Acquiror or any of their respective Subsidiaries, Affiliates, directors or officers set forth in the Proxy/Registration Statement is required to be amended, so that the Proxy/Registration Statement would not include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading, the party which discovers such information shall promptly notify the other parties and an appropriate amendment or supplement describing and/or correcting such information shall be promptly filed with the SEC and, to the extent required by Law, disseminated to the Acquiror Shareholders and Company Shareholders.
65
(b) Acquiror Shareholders’ Approval.
(i) As promptly as reasonably practicable after the Proxy/Registration Statement is declared effective under the Securities Act, Acquiror shall establish a record date for, duly call and give notice of, convene and hold a meeting of the Acquiror Shareholders (including any adjournment or postponement thereof, the “Acquiror Shareholders’ Meeting”) to be held as promptly as reasonably practicable following the date that the Proxy/Registration Statement is declared effective under the Securities Act for the purpose of voting on the Transaction Proposals, obtaining the Acquiror Shareholders’ Approval (including if necessary any adjournment or postponement of such meeting for the purpose of soliciting additional proxies in favor of the adoption of this Agreement), and providing Acquiror Shareholders with the opportunity to elect to effect an Acquiror Share Redemption and such other matters as may be mutually agreed by Acquiror and the Company.
(ii) Acquiror will use its reasonable best efforts to (A) solicit from its shareholders proxies in favor of the adoption of the Transaction Proposals, including the Acquiror Shareholders’ Approval, and (B) obtain the vote or consent of its shareholders required by and in compliance with all applicable Law, Nasdaq rules and the Acquiror’s Governing Documents. Acquiror (A) shall consult with the Company regarding the record date and the date of the Acquiror Shareholders’ Meeting, and (B) shall not adjourn or postpone the Acquiror Shareholders’ Meeting more than twice (and in that event, for no more than thirty (30) days in the aggregate) without the prior written consent of Company (which consent shall not be unreasonably withheld, conditioned or delayed); provided that Acquiror shall not be required to adjourn or propose to adjourn the Acquiror Shareholders’ Meeting.
(iii) The Proxy/Registration Statement shall include a statement to the effect that the Acquiror Board has unanimously recommended that the Acquiror Shareholders vote in favor of the Transaction Proposals at the Acquiror Shareholders’ Meeting (such statement, the “Acquiror Board Recommendation”) and neither the Acquiror Board nor any committee thereof shall withhold, withdraw, qualify, amend or modify, or publicly propose or resolve to withhold, withdraw, qualify, amend or modify, the Acquiror Board Recommendation.
(c) Company Shareholder Approval.
(i) As promptly as reasonably practicable after the later of (x) the Proxy/Registration Statement is declared effective under the Securities Act and (y) the Re-domiciliation and Continuation is completed, unless the Company is able to obtain the unanimous written consent of all of its Shareholders entitled to vote at the Company shareholders’ meeting, the Company shall establish a record date for, duly call, give notice of, convene and hold a meeting of the Company Shareholders (including any adjournment thereof, the “Company Shareholders’ Meeting”) to be held as promptly as reasonably practicable following the date that the Proxy/Registration Statement is declared effective under the Securities Act for the purpose of obtaining the Company Shareholder Approval (including any adjournment of such meeting for the purpose of soliciting additional proxies in favor of this Agreement) and such other matter as may be mutually agreed by Acquiror and the Company. The Company will use its reasonable best efforts to (A) solicit from its shareholders proxies in favor of the Company Shareholder Approval and will take such other action as is reasonably necessary or advisable to obtain such proxies and the Company Shareholder Approval and (B) obtain the vote or consent of its shareholders required by and in compliance with all applicable Law and the Company’s Governing Documents (including if necessary any adjournment or postponement of such meeting for the purpose of establishing a quorum). The Company (y) shall set the date of the Company Shareholders’ Meeting not more than fifteen (15) days after the Proxy/Registration Statement is declared effective or such other date as may be agreed by Acquiror and the Company in writing, acting reasonably, and (z) shall not adjourn the Company Shareholders’ Meeting for more than three (3) Business Days in aggregate (and in any event to a date not less than 48 hours before the scheduled Acquiror Shareholders’ Meeting) without the prior written consent of Acquiror (which consent shall not be unreasonably withheld, conditioned or delayed).
66
(ii) The Company shall send the Proxy/Registration Statement and the meeting materials to the Company Shareholders entitled to vote at the Company Shareholders’ Meeting and shall include together with all such meeting materials it sends to such Company Shareholders in connection with the Company Shareholders’ Meeting a statement to the effect that the Company Board has unanimously recommended that the Company Shareholders vote in favor of the Company Shareholder Approval (such statement, the “Company Board Recommendation”) and neither the Company Board nor any committee thereof shall withhold, withdraw, qualify, amend or modify, or publicly propose or resolve to withhold, withdraw, qualify, amend or modify, the Company Board Recommendation.
(d) Shareholder Approvals of the Acquisition Entities. As promptly as reasonably practicable after the Acquiror Shareholders’ Approval is obtained, Acquiror shall take all necessary actions to approve, as the sole shareholder of PubCo and Merger Sub, either by sole shareholder written consent or by resolutions of the sole shareholder, each of PubCo and Merger Sub’s entry into this Agreement and the other Transaction Documents to which they are party, the performance of the obligations by PubCo and Merger Sub under this Agreement or the other Transaction Documents, and the consummation of the Mergers, the Transactions and any other transactions contemplated by this Agreement or the other Transaction Documents.
Section 9.3. Support of Transaction. Without limiting any covenant contained in Article VII or Article VIII, Acquiror, PubCo and the Company shall each, and each shall cause its Subsidiaries to, (a) use reasonable best efforts to obtain all material consents and approvals of third parties that any of Acquiror, PubCo or the Company or their respective Affiliates are required to obtain in order to consummate the Mergers, (b) take such other action as may be reasonably necessary or as another party hereto may reasonably request to satisfy the conditions of Article X or otherwise to comply with this Agreement and to consummate the transactions contemplated hereby as soon as practicable, and (c) use commercially reasonable efforts to carry out the Transaction Financing after the date hereof; provided that the Company and Acquiror shall not be required to act or omit to take any action that would constitute a breach of Section 7.1 or Section 8.4, respectively.
Section 9.4. Tax Matters.
(a) Transfer Taxes. All transfer, documentary, sales, use, real property, stamp, registration and other similar Taxes, fees and costs (including any associated penalties and interest) incurred in connection with this Agreement shall be paid for by the Company pursuant to Section 12.6.
(b) Tax Treatment. For U.S. federal income tax purposes (and for purposes of any applicable state or local Tax that follows the U.S. federal income tax treatment), the parties shall prepare and file all Tax Returns consistent with the Intended Tax Treatment (to the extent required to file such a Tax Return) and shall not take any inconsistent position on any Tax Return, or during the course of any audit, litigation or other proceeding with respect to Taxes, except as otherwise required by applicable Law.
(c) Exclusions or Inclusions under Sections 481, 7121, or similar provisions. None of the Parties will be required to include any material amount of income or exclude any item of deduction for any taxable period ending after the Closing Date as a result of: (i) adjustment under Section 481 of the Code (or any corresponding or similar provision of state, local or non-U.S. income Tax Law) by reason of a change in method of accounting for a taxable period ending on or before the Closing Date; (ii) any “closing agreement” described in Section 7121 of the Code (or similar provision of state, local or non-U.S. income Tax Law) executed on or before the Closing Date; (iii) any installment sale or open sale transaction disposition made on or before the Closing Date; or (iv) any prepaid amount received on or before the Closing Date outside the ordinary course of business.
(d) Stock Distributions Under Sections 355 and/or 361 of the Code. None of the Parties have, within the last two years, distributed stock of another person, or has had its stock distributed by another person, in a transaction that was purported or intended to be governed in whole or in part by Section 355 or Section 361 of the Code.
(e) As of the date of this Agreement, none of the Parties have any reason to believe that any conditions or facts exist that would reasonably be expected to prevent or impede the Mergers from qualifying for the Intended Tax Treatment.
67
(f) Tax Matters Cooperation. The parties shall (and shall cause its respective Affiliates to) cooperate fully, as and to the extent reasonably requested by another party hereto, in connection with the filing of relevant Tax Returns, and any audit or tax proceeding. Such cooperation shall include the retention and (upon the other party’s request) the provision of records and information reasonably relevant to any tax proceeding or audit, making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder.
(g) Tax Opinions. If, in connection with the preparation and filing of the Proxy/Registration Statement, the SEC requires that tax opinions be prepared and submitted regarding (i) the qualification of the Re-domiciliation and Continuation for the Re-domiciliation and Continuation Intended Tax Treatment, the Company will use its reasonable best efforts to cause U.S. tax counsel engaged by the Company to deliver such tax opinion to the Company, (ii) the qualification of the Reincorporation Merger for the Reincorporation Merger Intended Tax Treatment, the Acquiror will use its reasonable best efforts to cause U.S. tax counsel engaged by the Acquiror to deliver such tax opinion to the Acquiror, or (iii) the qualification of the Acquisition Merger for the Acquisition Merger Intended Tax Treatment, the Company will use its reasonable best efforts to cause U.S. tax counsel engaged by the Company to deliver such tax opinion to the Company. In each such case, each party shall use reasonable best efforts to execute and deliver customary Tax representation letters to the applicable tax counsel in form and substance reasonably satisfactory to such counsel. Notwithstanding anything to the contrary in this Agreement, U.S. tax counsel engaged by the Acquiror shall not be required to provide any opinion to any party regarding the tax consequences of the Re-domiciliation and Continuation or the Acquisition Merger, and U.S. tax counsel engaged by the Company shall not be required to provide any opinion to any party regarding the tax consequences of the Reincorporation Merger.
Section 9.5. Cooperation; Consultation. Prior to the Acquisition Merger Closing, each of the Company, the Acquisition Entities and Acquiror shall, and each of them shall cause its respective Subsidiaries (as applicable) and its and their respective Representatives to reasonably cooperate in a timely manner in connection with any financing arrangement the parties mutually agree to seek in connection with the transactions contemplated by this Agreement (it being understood and agreed that the consummation of any such financing by the Company, the Acquisition Entities or Acquiror shall be subject to the parties’ mutual agreement), including (if mutually agreed by the parties) (a) by providing such information and assistance as the other party may reasonably request, (b) granting such access to the other party and its Representatives as may be reasonably necessary for their due diligence, and (c) participating in a reasonable number of meetings, presentations, road shows, drafting sessions and due diligence sessions with respect to such financing efforts (including direct contact between senior management and other Representatives of the Company and its Subsidiaries at reasonable times and locations). All such cooperation, assistance and access shall be granted during normal business hours and shall be granted under conditions that shall not unreasonably interfere with the business and operations of the Company, Acquiror, or their respective auditors.
Section 9.6. Indemnification and Insurance.
(a) From and after the Acquisition Merger Effective Time, each of the Surviving Company and the Surviving Acquiror agrees that it shall, to the fullest extent permitted under applicable Law, indemnify and hold harmless each present and former director and officer of the (x) Company and each of its Subsidiaries (in each case, solely to the extent acting in their capacity as such and to the extent such activities are related to the business of the Company being acquired under this Agreement) (the “Company Indemnified Parties”) and (y) Acquiror and each of its Subsidiaries (the “Acquiror Indemnified Parties” together with the Company Indemnified Parties, the “D&O Indemnified Parties”) against any costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any Legal Proceeding, whether civil, criminal, administrative or investigative, arising out of or pertaining to matters existing or occurring at or prior to the Acquisition Merger Effective Time, whether asserted or claimed prior to, at or after the Acquisition Merger Effective Time, to the fullest extent that the Company, Acquiror or their respective Subsidiaries, as the case may be, would have been permitted under applicable Law and each of their respective certificate of incorporation, certificate of formation, bylaws, limited liability company agreement or other organizational documents in effect on the date of this Agreement to indemnify such D&O Indemnified Parties (including the advancing of expenses as incurred to the fullest extent permitted under applicable Law). Without limiting the foregoing, the Surviving Company and the Surviving Acquiror shall, and shall cause their Subsidiaries to (i) maintain for a period of not less than six (6) years from the Acquisition Merger Effective Time provisions in its Governing Documents concerning the indemnification and exoneration (including provisions relating to expense advancement) of the Company’s, Acquiror’s and their Subsidiaries’ former and current officers, directors, employees, and agents that are no less favorable to those Persons than the provisions of the Governing Documents of the Company, Acquiror or their respective Subsidiaries, as applicable, in each case, as of the date of this Agreement, and (ii) not amend, repeal or otherwise modify such provisions in any respect that would adversely affect the rights of those Persons thereunder, in each case, except as required by Law.
68
(b) For a period of six (6) years from the Acquisition Merger Effective Time, the Surviving Company shall, and PubCo shall cause the Surviving Company to, maintain in effect directors’ and officers’ liability insurance covering those Persons who are currently covered by Acquiror’s, the Company’s or their respective Subsidiaries’ directors’ and officers’ liability insurance policies (true, correct and complete copies of which have been heretofore made available to the Company, Acquiror or their respective Representatives, as applicable) on terms not less favorable than the terms of such current insurance coverage, except that in no event shall the Surviving Company be required to pay an annual premium for such insurance in excess of two hundred percent (200%) of the aggregate annual premium payable by Acquiror or the Company, as applicable, for such insurance policy for the year ended December 31, 2025; provided that (i) the Surviving Company may cause coverage to be extended under the current directors’ and officers’ liability insurance by obtaining a six (6) year “tail” policy containing terms not materially less favorable than the terms of such current insurance coverage with respect to claims existing or occurring at or prior to the Acquisition Merger Effective Time and (ii) if any claim is asserted or made within such six (6) year period, any insurance required to be maintained under this Section 9.6 shall be continued in respect of such claim until the final disposition thereof.
(c) Notwithstanding anything contained in this Agreement to the contrary, (i) this Section 9.6 shall survive the Acquisition Merger Closing indefinitely and shall be binding, jointly and severally, on PubCo, the Surviving Company and the Surviving Acquiror and all of their respective successors and assigns; and (ii) in the event that PubCo, the Surviving Company or the Surviving Acquiror or any of their successors or assigns consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or transfers or conveys all or substantially all of its properties and assets to any Person, then, and in each such case, each of PubCo, the Surviving Company and the Surviving Acquiror shall ensure that proper provision shall be made so that the successors and assigns of PubCo, the Surviving Company and the Surviving Acquiror, as applicable, shall succeed to the obligations set forth in this Section 9.6.
(d) On the Reincorporation Merger Closing Date, PubCo shall enter into customary indemnification agreements reasonably satisfactory to each of the Company and Acquiror with the post-Reincorporation Merger Closing directors and officers of PubCo, which indemnification agreements shall continue to be effective following the Reincorporation Merger Closing.
(e) The provisions of this Section 9.6: (i) are intended to be for the benefit of, and shall be enforceable by, each Person who is now, or who has been at any time prior to the date of this Agreement or who becomes prior to the Reincorporation Merger Closing, a D&O Indemnified Party, his or her heirs and his or her personal representatives, (ii) shall be binding on PubCo, the Surviving Company and the Surviving Acquiror and their respective successors and assigns, (iii) are in addition to, and not in substitution for, any other rights to indemnification or contribution that any such Person may have, whether pursuant to Law, Contract, Governing Documents, or otherwise and (iv) shall survive the consummation of the Reincorporation Merger Closing and the Acquisition Merger Closing and shall not be terminated or modified in such a manner as to adversely affect any D&O Indemnified Party without the prior written consent of such D&O Indemnified Party.
Section 9.7. Public Announcements.
(a) The Parties agree that, at any time on or after the date hereof and continuing until the earlier of the termination of this Agreement in accordance with Section 11.1 or the Acquisition Merger Closing, no public release, filing or announcement concerning this Agreement or the other Transaction Documents or the Transactions shall be issued by any Party or any of their Representatives or Affiliates without the prior written consent (not be unreasonably withheld, conditioned or delayed) of Acquiror and the Company, except as such release or announcement may be required by applicable Law or the rules or regulations of any securities exchange, in which case the applicable Party shall use commercially reasonable efforts to allow the other Parties reasonable time to comment on, and arrange for any required filing with respect to, such release or announcement in advance of such issuance.
69
(b) The Parties shall mutually agree upon and, as promptly as practicable after the execution of this Agreement (but in any event within twenty-four (24) hours thereafter), issue a press release announcing the execution of this Agreement (the “Signing Press Release”). Promptly after the issuance of the Signing Press Release (but in any event within four (4) Business Days of the execution of this Agreement), Acquiror shall file a current report on Form 6-K or other applicable form (the “Signing Filing”) with the Signing Press Release and a description of this Agreement as required by applicable securities Laws, which shall be subject to the Company’s review, comment and approval prior to filing. The Parties shall mutually agree upon and, as promptly as practicable after the Acquisition Merger Closing Date (but in any event within four (4) Business Days thereafter), issue a press release announcing the consummation of the Transactions (the “Closing Press Release”). Promptly after the issuance of the Closing Press Release, PubCo shall file a current report on Form 6-K or other applicable form (the “Closing Filing”) with the Closing Press Release and a description of the Transactions as required by all applicable Laws which Acquiror and the Company shall review, comment upon and approve (which approval shall not be unreasonably withheld, conditioned or delayed) prior to filing. In connection with the preparation of the Signing Press Release, the Signing Filing, the Closing Filing, the Closing Press Release, or any other report, statement, filing notice or application made by or on behalf of a Party to any Governmental Authority or other third party in connection with the Transactions, the Company on one hand, and each of Acquiror and the Acquisition Entities on the other, shall, upon request by the other, furnish the other parties with all information concerning themselves, their respective directors, officers and equity holders, and such other matters as may be reasonably necessary or advisable in connection with the Transactions, or any other report, statement, filing, notice or application made by or on behalf of a Party to any third party and/or any Governmental Authority in connection with the Transactions.
Section 9.8. Transaction Financings; Stablecoin Issuance.
(a) Each of the Company, the Acquisition Entities and Acquiror shall use reasonable best efforts to take, or cause to be taken, all actions and do, or cause to be done, all things necessary, proper or advisable to: (a) identify sources of financing from third parties in the form of equity investments (the “Transaction Financing”), as mutually agreed between the Company and Acquiror and negotiate binding agreements in connection therewith (the “Transaction Financing Agreements”), in the form and substance reasonably satisfactory to the Company and Acquiror; and (b) reasonably cooperate in a timely manner in connection with any such Transaction Financing.
(b) The Parties are contemplating to conduct a Stablecoin Issuance on terms and conditions as may be agreed by the Company and Acquiror.
Section 9.9. Post-Merger Closing Directors and Officers of PubCo. Each of the Surviving Company, PubCo and Acquiror shall take all such action within its power as may be necessary or appropriate such that upon the Reincorporation Merger Closing:
(a) the board of directors of PubCo shall consist of (i) such individuals as determined by the Company, and (ii) the required number of independent directors under applicable SEC and Nasdaq listing rules and regulations, provided that such independent directors shall be selected by the Company and be consented to by the Acquiror (which shall not be unreasonably withheld, delayed or conditioned), in each case until their respective successors are duly elected or appointed in accordance with PubCo’s Governing Documents.
(b) the officers of PubCo consist of such individuals as determined by the Company, until their respective successors are duly elected or appointed and qualified.
Section 9.10. PubCo Equity Incentive Plan; the Founder Earn-Out Agreement.
(a) Prior to the Acquiror Shareholders’ Meeting, the Acquiror Board shall approve and adopt an equity incentive plan in form and substance reasonably satisfactory to the Company and the Acquiror (the “PubCo Equity Incentive Plan”) in accordance with applicable Laws, and shall recommend to the shareholders of the Acquiror to approve the PubCo Equity Incentive Plan at the Acquiror Shareholders’ Meeting. The total number of PubCo Ordinary Shares to be reserved for issuance pursuant to the PubCo Equity Incentive Plan shall be equal to ten percent (10%) of the Post-Closing Fully Diluted Share Count (excluding the number of shares to be reserved under the PubCo Equity Incentive Plan (i.e. prong (ii) in the definition of Post-Closing Fully Diluted Share Count)). After the Acquisition Merger Closing, PubCo shall use commercially reasonable efforts to file an effective registration statement on Form S-8 (or other applicable form), as promptly as practicable following the date PubCo is first allowed to file a registration statement on Form S-8 (or other applicable form), with respect to the PubCo Ordinary Shares issuable under the PubCo Equity Incentive Plan.
70
(b) Prior to the Acquiror Shareholders’ Meeting, the Acquiror Board shall approve an agreement by and between PubCo and the Company Founder in form and substance reasonably satisfactory to the Company and the Acquiror, providing for the equity grant and vesting conditions, including the key performance indicators set forth on Schedule 1 (Earn-Out Summary) and otherwise in a form and substance reasonably satisfactory to the Company and Acquiror (the “Founder Earn-Out Agreement”), and shall recommend to the shareholders of the Acquiror to approve the Founder Earn-Out Agreement at the Acquiror Shareholders’ Meeting. No amendment, modification, or waiver of the earnout terms, including the performance milestones, share counts, or payout methodology, of the Founder Earn-Out Agreement shall be effective without the prior written consent of all independent directors of the PubCo Board of Directors (or the Compensation Committee thereof, if appointed).
(c) At the Acquisition Merger Effective Time, PubCo shall issue the Founder Earn-Out Shares and directly deposit them into escrow with an escrow agent mutually agreed by the Sponsor and PubCo (the “Founder Escrow Shares”) in accordance with the Escrow Agreement. The Founder Escrow Shares shall be released to the Company Founder in accordance with the milestones set forth in Schedule 1 (Earn-Out Summary) and the Founder Earn-Out Agreement. Upon achievement of a milestone in accordance with Schedule 1 (Earn-Out Summary), the corresponding tranche of the Founder Escrow Shares shall be promptly released from escrow to the Company Founder or its affiliates. Any Founder Escrow Shares corresponding to a milestone that is not achieved by the end of the ten-year period set forth in Schedule 1 (Earn-Out Summary) shall be automatically forfeited to PubCo for no consideration and cancelled. During the period in which the Founder Escrow Shares are held in escrow, none of the escrow agent, the Company Founder or any other Person shall Transfer any Founder Escrow Shares then held in escrow; provided that the Company Founder shall be entitled to exercise or direct the escrow agent to exercise all voting rights in respect of such Founder Escrow Shares at any meeting of shareholders of PubCo or by written consent, and any dividend or distribution in respect of such Founder Escrow Shares shall accrue and be placed into the escrow and shall only be released together with the corresponding Founder Escrow Shares when the corresponding Founder Escrow Shares are released to the Company Founder (or, if such Founder Escrow Shares are forfeited to PubCo, the corresponding dividend or distribution shall be forfeited and returned to PubCo). The terms of the escrow shall be set forth in the Founder Earn-Out Agreement and the Escrow Agreement. The adjustment, clawback and sale-of-company provisions set forth in Schedule 1 (Earn-Out Summary) shall apply to the Founder Escrow Shares.
Section 9.11. Transaction Documents.
(a) Prior to the Reincorporation Merger Closing Date, the Parties shall use best efforts to agree on the forms of the Transaction Documents not already agreed by the Parties and attached hereto as exhibits. The Parties shall (i) at the Acquisition Merger Effective Time, issue, or cause to be issued, the Binance PubCo Warrant to the Binance Warrantholder, (ii) at the Acquisition Merger Effective Time, issue, or cause to be issued, the Noble Elite PubCo Warrant to Noble Elite, and (iii) prior to or at the Acquisition Merger Effective Time, deliver to the Binance Warrantholder a copy of the Registration Rights Agreement executed by the PubCo to which the Binance Warrantholder will become a party as a Holder (as defined therein) upon the delivery to the Parties of a duly executed signature page of Binance Warrantholder thereto.
(b) Except as otherwise contemplated by this Agreement or the other Transaction Documents, during the Interim Period, Acquiror shall not amend any Transaction Document, or agree to amend any Transaction Document, unless consented to by the Company in writing (which consent shall not be unreasonably conditioned, withheld, or delayed).
(c) Except as otherwise contemplated by this Agreement or the other Transaction Documents, during the Interim Period, the Company shall not amend any Transaction Document, or agree to amend any Transaction Document, unless consented to by Acquiror in writing (which consent shall not be unreasonably conditioned, withheld, or delayed).
71
Section 9.12. Formation of Merger Sub and Joinder. As promptly as practicable following the date hereof (and in any event prior to the initial filing of the Registration Statement with the SEC), Acquiror shall cause Merger Sub to be formed in the Cayman Islands solely for the purpose of engaging in the Transactions (as more fully set forth in the recitals of this Agreement) with memorandum and articles of association of Merger Sub in a form and substance reasonably agreed upon by the Acquiror and the Company. When it is formed, each of PubCo and Merger Sub shall be one hundred percent (100%) owned by Acquiror, and from its formation and through the Acquisition Merger Closing, PubCo shall qualify as a foreign private issuer pursuant to Rule 3b-4 of the Exchange Act. Promptly after the Acquiror receives the memorandum and articles of association following the formation of Merger Sub from the Cayman Islands Registrar (and in any event within two (2) Business Days thereafter), the Acquiror shall (i) cause Merger Sub (as the case may be) to execute and deliver to the Parties a joinder agreement in the form attached hereto as Exhibit G (a “Joinder Agreement”), pursuant to which, among other things, Merger Sub shall (A) become a party to this Agreement as of the date thereof and (B) agree to be bound by the terms, covenants and other provisions of this Agreement applicable to Merger Sub under this Agreement and shall assume all rights and obligations applicable to Merger Sub hereunder, with the same force and effect as if originally named herein, and (ii) deliver to the Company evidence of Merger Sub’s adoption and approval of this Agreement and the Transactions in form and substance reasonably acceptable to the Company. Notwithstanding anything to the contrary contained in this Agreement, any reference in this Agreement to Merger Sub’s execution and delivery of this Agreement will mean Merger Sub’s execution and delivery of the Joinder Agreement, and any reference in this Agreement to any representation or warranty made by Merger Sub as of the date of this Agreement will mean any representation or warranty made by Merger Sub as of the date of its execution and delivery of the applicable Joinder Agreement. The rights and obligations of Merger Sub under this Agreement shall not be effective until its execution and delivery of the Joinder Agreement.
Section 9.13. Black Spade Arrangement.
(a) Concurrently with the consummation of the Acquisition Merger, PubCo shall issue 250,000 PubCo Class A Ordinary Shares to Black Spade Advisory Inc. (“Black Spade”) pursuant to the First Digital Strategic Advisory Agreement, dated December 23, 2025, by and between the Company and Black Spade (as amended and supplemented from time to time, the “Black Spade Agreement”). Concurrently with the consummation of the Acquisition Merger, the Sponsor shall surrender to PubCo 250,000 PubCo Class A Ordinary Shares for nil consideration, and the Parties shall procure that this arrangement is reflected in the Sponsor Share Restructuring Agreement.
(b) After the Acquisition Merger Effective Time, pursuant to the Black Spade Agreement, Black Spade is entitled to receive (i) 300,000 PubCo Class A Ordinary Shares if certain proceedings as specified in the Black Spade Agreement are finally resolved by no later than three (3) months after the Acquisition Merger Closing, or (ii) 250,000 PubCo Class A Ordinary Shares if certain proceedings as specified in the Black Spade Agreement are finally resolved by no later than six (6) months after the Acquisition Merger Closing. After the Acquisition Merger Effective Time, PubCo shall issue such PubCo Class A Ordinary Shares to Black Spade pursuant to the Black Spade Agreement, and upon the issuance of such PubCo Class A Ordinary Shares by PubCo to Black Spade pursuant to the Black Spade Agreement, the Sponsor shall simultaneously surrender to PubCo the same number of PubCo Class A Ordinary Shares for nil consideration.
(c) The Parties shall procure that the surrender of PubCo Class A Ordinary Shares pursuant to this Section 9.13 shall be reflected in the Sponsor Share Restructuring Agreement.
(d) The Parties acknowledge that Nemi has transferred 250,000 Company Preference Shares to Black Spade on or about the date hereof, and will transfer an additional 500,000 Company Preference Shares to Black Spade upon or about the Acquisition Merger Closing. Further, PubCo shall issue 250,000 PubCo Class A Ordinary Shares to Black Spade if certain proceedings as specified in the Black Spade Agreement are finally resolved by no later than one (1) year after the Acquisition Merger Closing.
72
Section 9.14. CCM Arrangement. Concurrently with the consummation of the Acquisition Merger, PubCo shall issue 700,000 PubCo Class A Ordinary Shares to CCM, provided that if the total gross proceeds from certain sources as provided in the CCM Agreement do not exceed US$200 million, such number of PubCo Class A Ordinary Shares should be reduced to 500,000 PubCo Class A Ordinary Shares.
Section 9.15. Change of PubCo Name. The Parties shall, prior to the Acquisition Merger Closing, take all necessary actions to cause the name of PubCo to be changed to “First Digital Holdings Ltd.” or such other name as may be mutually agreed upon by the Company and the Acquiror.
ARTICLE X
CONDITIONS TO CLOSING
Section 10.1. Conditions of Each Party’s Obligations. The obligations of each Party to consummate, or cause to be consummated, the Acquisition Merger, are subject to the satisfaction of the following conditions, any one or more of which may be waived in writing by the party or parties whose obligations are conditioned thereupon:
(a) the Company shall have completed the Re-domiciliation and Continuation (such Re-domiciliation and Continuation requiring (i) the Re-domiciliation and Continuation Shareholder Approval, (ii) applicable notice periods and legal processes being followed in connection with the Re-domiciliation and Continuation in accordance with the Gibraltar Companies Act and Cayman Companies Act, and (iii) the receipt of formal evidence confirming completion of the Re-domiciliation and Continuation from the relevant authorities in Gibraltar and Cayman Islands);
(b) the Reincorporation Merger shall have been consummated;
(c) the Acquiror Shareholders’ Approval shall have been obtained and remain in full force and effect;
(d) the Company Shareholder Approval shall have been obtained and remain in full force and effect;
(e) the Proxy/Registration Statement shall have become effective under the Securities Act and no stop order suspending the effectiveness of the Proxy/Registration Statement shall have been issued and no proceedings for that purpose shall have been initiated or threatened by the SEC and not withdrawn;
(f) (i) PubCo’s initial listing application with Nasdaq in connection with the Transactions shall have been conditionally approved and, immediately following the Acquisition Merger Closing, PubCo shall satisfy any applicable initial and continuing listing requirements of Nasdaq and PubCo shall not have received any written notice of material non-compliance therewith unless any non-compliance is curable within 30 days of receipt of such notice, and (ii) the PubCo Ordinary Shares to be issued in connection with the Transactions shall have been approved for listing on Nasdaq, subject to official notice of issuance; and
(g) no Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) or Governmental Order that is then in effect and which has the effect of making the Acquisition Merger Closing illegal or which otherwise prevents or prohibits consummation of the Acquisition Merger Closing (any of the foregoing, a “restraint”), and there shall have been no consent or approval from any Governmental Authority that, if not obtained, would render the Acquisition Merger Closing illegal (a “regulatory approval”), other than any such restraint or regulatory approval that is immaterial.
73
Section 10.2. Conditions to Obligations of Acquiror. The obligations of the Acquisition Entities and Acquiror to consummate, or cause to be consummated, the Acquisition Merger are subject to the satisfaction of the following additional conditions, any one or more of which may be waived in writing by Acquiror:
(a) The Company Fundamental Representations (in each case disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Company Material Adverse Effect” or any similar qualification or exception) shall be true and correct in all respects at and as of the date hereof, at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date respectively, and at and as of the Acquisition Merger Closing Date as if made at and as of the Acquisition Merger Closing Date (except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties shall be true and correct in all respects at and as of such date). Each of the other representations and warranties of the Company contained in this Agreement (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Company Material Adverse Effect” or any similar qualification or exception) shall be true and correct at and as of the date hereof, at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date, and at and as of the Acquisition Merger Closing Date as if made at and as of the Acquisition Merger Closing Date, respectively, in each case of the foregoing except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, a Company Material Adverse Effect (except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Company Material Adverse Effect” or any similar qualification or exception) shall be true and correct at and as of such date except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, a Company Material Adverse Effect);
(b) each of the covenants of the Company to be performed as of or prior to the Acquisition Merger Closing shall have been performed in all material respects;
(c) the Company shall have delivered to Acquiror a certificate signed by an authorized director or officer of each of the Company certifying that the conditions specified in clauses (a) to (b). have been fulfilled;
(d) there has not been any Event that has had, or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect;
(e) there has not been any Legal Proceeding pending or threatened in writing against the Company that has a Company Material Adverse Effect; and
(f) PubCo shall have received all Transaction Documents to which the Company is a party duly executed and delivered by the Company, including without limitation the Sponsor Warrant.
Section 10.3. Conditions to Obligations of the Company. The obligations of the Company to consummate, or cause to be consummated, the Acquisition Merger are subject to the satisfaction of the following additional conditions, any one or more of which may be waived in writing by the Company:
(a) The Acquiror Fundamental Representations (in each case disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Acquiror Material Adverse Effect” or any similar qualification or exception) shall be true and correct in all respects at and as of the date hereof, at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date respectively, and at and as of the Acquisition Merger Closing Date as if made at and as of the Acquisition Merger Closing Date (except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties shall be true and correct in all respects at and as of such date). Each of the other representations and warranties of the Acquiror contained in this Agreement (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Acquiror Material Adverse Effect” or any similar qualification or exception) shall be true and correct at and as of the date hereof, at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date,
74
and at and as of the Acquisition Merger Closing Date as if made at and as of the Acquisition Merger Closing Date, respectively, in each case of the foregoing except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, an Acquiror Material Adverse Effect (except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “Acquiror Material Adverse Effect” or any similar qualification or exception) shall be true and correct at and as of such date except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, an Acquiror Material Adverse Effect Material Adverse Effect). Each of the representations and warranties of the Acquisition Entities contained in this Agreement (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “material adverse effect” or any similar qualification or exception) shall be true and correct at and as of the date hereof, at and as of the Reincorporation Merger Closing Date as if made at and as of the Reincorporation Merger Closing Date, and at and as of the Acquisition Merger Closing Date as if made at and as of the Acquisition Merger Closing Date, respectively, except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, a material adverse effect on any Acquisition Entity (except with respect to such representations and warranties which speak as to an earlier date, which representations and warranties (disregarding any qualifications or exceptions contained therein relating to materiality, “material” or “material adverse effect” or any similar qualification or exception) shall be true and correct at and as of such date, except for inaccuracies in or the failure of such representations and warranties to be true and correct that, individually or in the aggregate, have not had, and would not reasonably be expected to have, a material adverse effect on any Acquisition Entity).
(b) each of the covenants of Acquiror and the Acquisition Entities to be performed as of or prior to the Acquisition Merger Closing shall have been performed in all material respects;
(c) PubCo (as the Surviving Acquiror) and the Acquisition Entities shall have delivered to the Company a certificate signed by an authorized director or officer of PubCo (as the Surviving Acquiror) and the Acquisition Entities certifying that the conditions specified in clauses (a) to (b) have been fulfilled;
(d) there has not been any Event that has had, or would reasonably be expected to have, individually or in the aggregate, an Acquiror Material Adverse Effect; and
(e) the Company shall have received all Transaction Documents to which any of PubCo, Acquiror, the Acquisition Entities or their respective Affiliates or shareholders (including the Sponsor) is a party duly executed and delivered by PubCo, Acquiror, the Acquisition Entities or their respective Affiliates, PubCo, Acquiror, the Acquisition Entities or their respective Affiliates or shareholders party thereto.
Section 10.4. Frustration of Conditions. Notwithstanding anything contained herein to the contrary, no Party may rely on the failure of any condition set forth in this Article X to be satisfied if such failure was caused by the failure of such Party or its Affiliates to comply with or perform any of its covenants or obligations set forth in this Agreement. For the avoidance of doubt, the occurrence of any Company Material Adverse Effect shall not be the fault of any party unless such Company Material Adverse Effect is a result of the breach of this Agreement or any other Transaction Document by such Party, in which case such breaching Party cannot rely on the non-satisfaction of Section 10.2(d) to not proceed with the Reincorporation Merger Closing or the Acquisition Merger Closing, and the occurrence of any Acquiror Material Adverse Effect shall not be the fault of any party unless such Acquiror Material Adverse Effect is a result of the breach of this Agreement or any other Transaction Document by such Party, in which case such breaching Party cannot rely on the non-satisfaction of Section 10.3(d) to not proceed with the Reincorporation Merger Closing or the Acquisition Merger Closing.
75
ARTICLE XI
TERMINATION/EFFECTIVENESS
Section 11.1. Termination. This Agreement may be terminated and the transactions contemplated hereby abandoned prior to the Acquisition Merger Effective Time:
(a) by mutual written consent of the Company and Acquiror;
(b) by written notice from either the Company or Acquiror to the other if any Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) or Governmental Order that is then in effect and which has the effect of making the Acquisition Merger Closing or Reincorporation Merger Closing illegal or which otherwise prevents or prohibits consummation of the Acquisition Merger Closing or Reincorporation Merger Closing, other than any such restraint that is immaterial;
(c) by written notice to Acquiror from the Company if the Acquiror Shareholders’ Approval shall not have been obtained by reason of the failure to obtain the required vote at the Acquiror Shareholders’ Meeting duly convened therefor or at any adjournment or postponement thereof;
(d) by written notice to the Company from Acquiror if there is any breach of any representation, warranty, covenant or agreement on the part of the Company set forth in this Agreement, such that the conditions specified in Section 10.1 or Section 10.2 would not be satisfied at the Acquisition Merger Closing (a “Terminating Company Breach”), except that, if such Terminating Company Breach is curable by the Company through the exercise of its reasonable best efforts, then, for a period of up to thirty (30) days after receipt by the Company of notice from Acquiror of such breach, but only as long as the Company continues to use its respective reasonable best efforts to cure such Terminating Company Breach (the “Company Cure Period”), such termination shall not be effective, and such termination shall become effective only if the Terminating Company Breach is not cured within the Company Cure Period; provided that the Acquiror shall not have the right to terminate this Agreement pursuant to this Section 11.1(d) if it is then in material breach of any of its representations, warranties, covenants or agreements set forth in this Agreement;
(e) by written notice from either the Company or Acquiror to the other if the Acquisition Merger Closing has not occurred on or before the date that is six (6) months from the date hereof (the “Agreement End Date”); provided that (i) the right to terminate this Agreement pursuant to this Section 11.1(e) shall not be available to Acquiror if Acquiror’s or Acquisition Entities’ material breach of this Agreement shall have primarily caused the failure of the Acquisition Merger Closing to occur on or before the Agreement End Date, and (ii) the right to terminate this Agreement pursuant to this Section 11.1(e) shall not be available to the Company if the Company’s material breach of this Agreement shall have primarily caused the failure of the Acquisition Merger Closing to occur on or before the Agreement End Date;
(f) by written notice to the Company from Acquiror if the Company Shareholder Approval shall not have been obtained by reason of the failure to obtain the required vote at the Company Shareholders’ Meeting duly convened therefor or at any adjournment or postponement thereof; or
(g) by written notice to Acquiror from the Company if there is any breach of any representation, warranty, covenant or agreement on the part of Acquiror set forth in this Agreement, such that the conditions specified in Section 10.1 or Section 10.3 would not be satisfied at the Acquisition Merger Closing (a “Terminating Acquiror Breach”), except that, if any such Terminating Acquiror Breach is curable by Acquiror through the exercise of its reasonable best efforts, then, for a period of up to thirty (30) days after receipt by Acquiror of notice from the Company of such breach, but only as long as Acquiror continues to exercise such reasonable best efforts to cure such Terminating Acquiror Breach (the “Acquiror Cure Period”), such termination shall not be effective, and such termination shall become effective only if the Terminating Acquiror Breach is not cured within the Acquiror Cure Period; provided that the Company shall not have the right to terminate this Agreement pursuant to this Section 11.1(g) if it is then in material breach of any of its representations, warranties, covenants or agreements set forth in this Agreement.
Section 11.2. Effect of Termination. In the event of the termination of this Agreement pursuant to Section 11.1, this Agreement shall forthwith become void and have no effect, without any liability on the part of any party hereto or its respective Affiliates, officers, directors or shareholders, other than liability of the Company, PubCo, Acquiror or Merger Sub, as the case may be, for any willful and material breach of this Agreement occurring prior to such termination, except that the provisions of this Section 11.2 and Article XII and the Confidentiality Agreement shall survive any termination of this Agreement.
76
ARTICLE XII
MISCELLANEOUS
Section 12.1. Trust Account Waiver. The Company hereby represents and warrants that it has read the final prospectus of Acquiror and filed with the SEC (File No. 333-288156) on August 27, 2025 and current report on Form 8-K of Acquiror dated and filed with the SEC on August 28, 2025 available at www.sec.gov, and understands that the Acquiror has established the Trust Account described therein for the benefit of the Acquiror’s public shareholders and that, except for a portion of the interest earned on the amounts held in the Trust Account pursuant to the Trust Agreement, the Acquiror may only disburse the funds in the Trust Account (i) to the public shareholders in the event of the conversion of their shares upon consummation of a business combination or amendment to the Acquiror’s certificate of incorporation relating to pre-business combination activity, (ii) to the public shareholders in connection with the Acquiror’s liquidation in the event the Acquiror is unable to consummate a business combination within the required time, and (iii) to the Acquiror concurrently with, or after the Acquiror consummates a business combination. Accordingly, for and in consideration of the Acquiror entering into this Agreement, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company hereby irrevocably waives any past, present or future Action of any kind against, and any right to access, the Trust Account or to collect from the Trust Account any monies that may be owed to it for any reason whatsoever, and will not seek recourse against the Trust Account at any time for any reason whatsoever.
Section 12.2. Waiver. Subject to Section 12.5, any party to this Agreement may, at any time prior to the Acquisition Merger Closing, by action taken by its board of directors or other officers or Persons thereunto duly authorized, (a) extend the time for the performance of the obligations or acts of the other parties hereto, (b) waive any inaccuracies in the representations and warranties (of another party hereto) that are contained in this Agreement or (c) waive compliance by the other parties hereto with any of the agreements or conditions contained in this Agreement, but such extension or waiver shall be valid only if set forth in an instrument in writing signed by the party granting such extension or waiver.
Section 12.3. Notices. All general notices, demands or other communications required or permitted to be given or made hereunder shall be in writing and delivered personally or sent by courier or sent by registered post or sent by electronic mail to the intended recipient thereof at its address or at its email address set out below (or to such other address or email address as a party may from time to time notify the other parties). Any such notice, demand or communication shall be deemed to have been duly served (a) if given personally or sent by courier, upon delivery during normal business hours at the location of delivery or, if later, then on the next Business Day after the day of delivery; (b) if sent by electronic mail during normal business hours at the location of delivery, immediately, or, if later, then on the next Business Day after the day of delivery; (c) the third Business Day following the day sent by reputable international overnight courier (with written confirmation of receipt); and (d) if sent by registered post, five (5) days after posting. The initial addresses and email addresses of the parties for the purpose of this Agreement are:
| (a) | If to Acquiror, PubCo or Merger Sub, to: | |||
|
CSLM Digital Asset Acquisition Corp III, Ltd 2400 E. Commercial Boulevard, Suite 900 Ft. Lauderdale, FL 33308 | ||||
| Attention: | Vik Mittal | |||
| Email: | vik@meteoracapital.com | |||
| with copies to (which shall not constitute notice): | ||||
| Loeb & Loeb LLP | ||||
|
345 Park Avenue New York, NY | ||||
| Attention: | Mitchell S. Nussbaum | |||
| Email: | mnussbaum@loeb.com | |||
77
| (b) | If to the Company, to: | |||
| First Digital Group Limited | ||||
| Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong | ||||
| Attention: | Vincent Chok; Legal Department | |||
| Email: | v.chok@1stDigital.com; legal@1stDigital.com | |||
| with copies to (which shall not constitute notice): | ||||
|
DLA Piper LLP (US) 555 Mission Street Suite 2400 San Francisco, CA 94105 | ||||
| Attention: | Jeffrey Selman | |||
| Email: | jeffrey.selman@us.dlapiper.com | |||
|
DLA Piper UK LLP | ||||
| Attention: | Yang Ge, Esq.; James Chang, Esq. | |||
| Email: | yang.ge@dlapiper.com; james.chang@dlapiper.com | |||
or to such other address or addresses as the parties may from time to time designate in writing. Copies delivered solely to outside counsel shall not constitute notice.
Section 12.4. Assignment. No party hereto shall assign this Agreement or any part hereof without the prior written consent of the other parties and any such transfer without such prior written consent shall be void. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns.
Section 12.5. Rights of Third Parties. Except as expressly provided herein, nothing expressed or implied in this Agreement is intended or shall be construed to confer upon or give any Person, other than the parties hereto, any right or remedies under or by reason of this Agreement; provided that (a) Binance Warrantholder may directly enforce Section 3.1(b)(iii), the second sentence of Section 9.11(a) and Section 12.12, (b) Noble Elite may directly enforce Section 3.1(b)(iv), the second sentence of Section 9.11(a) and Section 12.12, (c) the Company Founder may enforce Section 9.10, (d) the D&O Indemnified Parties may enforce Section 9.6; and (e) the Non-Recourse Parties may enforce Section 12.8.
Section 12.6. Expenses. Except as otherwise set forth in this Agreement (including Section 8.1), each party hereto shall be responsible for and pay its own expenses incurred in connection with this Agreement and the transactions contemplated hereby, including all fees of its legal counsel, financial advisers and accountants.
Section 12.7. Governing Law. This Agreement, and all claims or causes of action based upon, arising out of, or related to this Agreement or the transactions contemplated hereby, shall be governed by, and construed in accordance with, the Laws of the State of New York, without giving effect to principles or rules of conflict of Laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction (provided that the fiduciary duties of the Company Board and the board of directors of Acquiror, the Mergers and any exercise of appraisal and dissenters’ rights with respect to the Mergers, shall in each case be governed by the laws of the Cayman Islands).
78
Section 12.8. Headings; Counterparts. The headings in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Section 12.9. Electronic Execution of the Agreement and Certain Other Documents. The words “execution,” “execute,” “signed,” “signature,” and words of like import in or related to this Agreement or any Transaction Document (including any related amendments, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms complying with applicable law, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Cayman Islands Electronic Transactions Act (As Revised), the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
Section 12.10. Company Disclosure Letter and Acquiror Disclosure Letter. Each of the Company Disclosure Letter and the Acquiror Disclosure Letter (including, in each case, any section thereof) referenced herein are a part of this Agreement as if fully set forth herein. All references herein to the Company Disclosure Letter and/or the Acquiror Disclosure Letter (including, in each case, any section thereof) shall be deemed references to such parts of this Agreement, unless the context shall otherwise require. Any disclosure made by a party in the applicable Disclosure Letter, or any section thereof, with reference to any section of this Agreement or section of the applicable Disclosure Letter shall be deemed to be a disclosure with respect to such other applicable sections of this Agreement or sections of the applicable Disclosure Letter only if it is reasonably apparent on the face of such disclosure that such disclosure is responsive to such other section of this Agreement or section of the applicable Disclosure Letter. Certain information set forth in the Disclosure Letters is included solely for informational purposes and may not be required to be disclosed pursuant to this Agreement. The disclosure of any information shall not be deemed to constitute an acknowledgment that such information is required to be disclosed in connection with the representations and warranties made in this Agreement, nor shall such information be deemed to establish a standard of materiality.
Section 12.11. Entire Agreement. This Agreement (together with the Company Disclosure Letter and the Acquiror Disclosure Letter) and the other Transaction Documents constitute the entire agreement among the parties to this Agreement relating to the transactions contemplated hereby and supersede any other agreements, whether written or oral, that may have been made or entered into by or among any of the parties hereto or any of their respective Subsidiaries relating to the transactions contemplated hereby. No representations, warranties, covenants, understandings, agreements, oral or otherwise, relating to the transactions contemplated hereby exist between such parties except as expressly set forth in this Agreement and the other Transaction Documents.
Section 12.12. Amendments. This Agreement may be amended or modified in whole or in part, by and only by a duly authorized agreement in writing executed in the same manner as this Agreement and which makes reference to this Agreement; provided that after the Company Shareholder Approval or the Acquiror Shareholders’ Approval has been obtained, there shall be no amendment or waiver that by applicable Law requires further approval by the Company Shareholders or the Acquiror Shareholders, respectively, without such approval having been obtained; provided, further that (x) none of Section 12.5 and this Section 12.12, nor the form of the Registration Rights Agreement may be amended or modified in a manner that (i) adversely affects any right that is specific to Binance Warrantholder or (ii) adversely and disproportionately affect Binance Warrantholder as compared to the holders of Company Preference Shares, in each case without the prior written consent of Binance Warrantholder, (y) none of Section 3.1(b)(iii), the second sentence of Section 9.11(a), the definition of “Exchange Ratio” set forth in Section 1.1 or the form of the Binance PubCo Warrant may be amended or modified without the prior written consent of Binance Warrantholder, and (z) none of Section 3.1(b)(iv), the second sentence of Section 9.11(a) and Section 12.12, the definition of “Exchange Ratio” set forth in Section 1.1 or the form of the Noble Elite PubCo Warrant may be amended or modified without the prior written consent of Noble Elite.
79
Section 12.13. No Presumption Against Drafter. Each party hereto and its advisers cooperated in the drafting and preparation of this Agreement, and any and all drafts relating thereto may not be construed against any party by reason of its preparation. Accordingly, any rule of Law or any legal decision that would require interpretation of any ambiguities in this Agreement against the party that drafted it is of no application and is hereby expressly waived.
Section 12.14. Publicity.
(a) All press releases or other public communications relating to the transactions contemplated hereby, and the method of the release for publication thereof, shall prior to the Acquisition Merger Closing be subject to the prior mutual approval of Acquiror, PubCo and the Company, which approval shall not be unreasonably withheld or delayed by any party; provided that no party shall be required to obtain consent pursuant to this Section 12.14(a) to the extent any proposed release or statement is substantially equivalent to the information that has previously been made public without breach of the obligation under this Section 12.14(a).
(b) The restriction in Section 12.14(a) shall not apply to the extent the public announcement is required by applicable securities Law, any Governmental Authority or stock exchange rule; provided that in such an event, the party making the announcement shall use its commercially reasonable efforts to consult with the other parties in advance as to its form, content and timing. Disclosures resulting from the parties’ efforts to obtain approval under applicable Law and to make any related filing shall be deemed not to violate this Section 12.14.
Section 12.15. Severability. If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement shall remain in full force and effect. The parties further agree that if any provision contained herein is, to any extent, held invalid or unenforceable in any respect under the Laws governing this Agreement, they shall take any actions necessary to render the remaining provisions of this Agreement valid and enforceable to the fullest extent permitted by Law and, to the extent necessary, shall amend or otherwise modify this Agreement to replace any provision contained herein that is held invalid or unenforceable with a valid and enforceable provision giving effect to the intent of the parties.
Section 12.16. Jurisdiction; Waiver of Jury Trial.
(a) Each of the parties irrevocably and unconditionally submits to the exclusive jurisdiction of the federal courts of the State of New York sitting in New York, New York (or any appellate courts thereof), for the purposes of any Action (a) arising under this Agreement or the transactions contemplated hereby or (b) in any way connected with or related or incidental to the dealings of the parties in respect of this Agreement or the transactions contemplated hereby or any of the transactions contemplated hereby or thereby, and irrevocably and unconditionally waives any objection to the laying of venue of any such Action in any such court, and further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such Action has been brought in an inconvenient forum. Each party hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any Action (i) arising under this Agreement or the transactions contemplated hereby or (ii) in any way connected with or related or incidental to the dealings of the parties in respect of this Agreement or the transactions contemplated hereby or any of the transactions contemplated hereby or thereby, (A) any claim that it is not personally subject to the jurisdiction of the courts as described in this Section 12.16 for any reason, (B) that it or its property is exempt or immune from the jurisdiction of any such court or from any Action commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (C) that (x) the Action in any such court is brought in an inconvenient forum, (y) the venue of such Action is improper or (z) this Agreement, or the subject matter hereof, may not be enforced in or by such courts. Each party hereto agrees that service of any process, summons, notice or document by registered mail to such party’s respective address set forth in Section 12.3 shall be effective service of process for any such Action.
80
(b) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY, UNCONDITIONALLY AND VOLUNTARILY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, SUIT OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 12.17. Enforcement. The parties hereto agree that irreparable damage could occur in the event that 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 shall be entitled to seek an injunction or injunctions to prevent breaches of this Agreement and to specific enforcement of the terms and provisions of this Agreement, in addition to any other remedy to which any party is entitled at law or in equity. In the event that any Action shall be brought in equity to enforce the provisions of this Agreement, no party shall allege, and each party hereby waives the defense, that there is an adequate remedy at law, and each party agrees to waive any requirement for the securing or posting of any bond in connection therewith.
Section 12.18. Non-Recourse. Except in the case of claims against a Person in respect of such Person’s fraud and except as set forth in Section 12.5:
(a) this Agreement may only be enforced against, and any claim or cause of action based upon, arising out of, or related to this Agreement or the transactions contemplated hereby may only be brought against, the Company, PubCo, Acquiror and Merger Sub as named parties hereto; and
(b) except to the extent a party hereto (and then only to the extent of the specific obligations undertaken by such party hereto), (i) no past, present or future director, commissioner, officer, employee, incorporator, member, partner, shareholder, Representative or Affiliate of the Company, PubCo, Acquiror or Merger Sub and (ii) no past, present or future director, commissioner, officer, employee, incorporator, member, partner, shareholder, Representative or Affiliate of any of the foregoing (collectively, the “Non-Recourse Parties”) shall have any liability (whether in Contract, tort, equity or otherwise) for any one or more of the representations, warranties, covenants, agreements or other obligations or liabilities of any one or more of the Company, PubCo, Acquiror or Merger Sub under this Agreement for any claim based on, arising out of, or related to this Agreement or the transactions contemplated hereby.
Section 12.19. Non-Survival of Representations, Warranties and Covenants. Except (x) as otherwise contemplated by Section 11.2 or (y) in the case of claims against a Person in respect of such Person’s fraud, none of the representations, warranties, covenants, obligations or other agreements in this Agreement or in any certificate, statement or instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such representations, warranties, covenants, obligations, agreements and other provisions, shall survive the Acquisition Merger Closing and each such representation, warranty, covenant, obligation, agreement and provision shall terminate and expire upon the occurrence of the Acquisition Merger Effective Time (and there shall be no liability after the Acquisition Merger Closing in respect thereof), except for (a) those covenants and agreements contained herein that by their terms expressly apply in whole or in part after the Acquisition Merger Closing and then only with respect to any breaches occurring after the Acquisition Merger Closing, (b) the conversion of the securities of the Company and the Acquiror as contemplated by Article III, and (c) this Article XII.
81
Section 12.20. Conflicts and Privilege.
(a) Acquiror, the Company, PubCo and Merger Sub, on behalf of their respective successors and assigns (including, after the Acquisition Merger Closing, the Surviving Company and the Surviving Acquiror), hereby agree that, in the event a dispute with respect to this Agreement or the transactions contemplated hereby arises after the Acquisition Merger Closing between or among (x) the Sponsor, the shareholders or holders of other equity interests of Acquiror or the Sponsor and/or any of their respective directors, members, partners, officers, employees or Affiliates (other than the Surviving Company, the Surviving Acquiror and PubCo) (collectively, the “Acquiror Group”), on the one hand, and (y) the Surviving Company, the Surviving Acquiror, PubCo and/or any member of the Company Group, on the other hand, any legal counsel, including Loeb & Loeb LLP (“Loeb”), that represented Acquiror and/or the Sponsor prior to the Reincorporation Merger Closing may represent the Sponsor and/or any other member of the Acquiror Group, in such dispute even though the interests of such Persons may be directly adverse to the Surviving Company, the Surviving Acquiror or PubCo and even though such counsel may have represented Acquiror and/or the Sponsor in a matter substantially related to such dispute, or may be handling ongoing matters for the Surviving Company, the Surviving Acquiror or PubCo. Acquiror, the Company and Merger Sub, on behalf of their respective successors and assigns (including, after the Acquisition Merger Closing, PubCo the Surviving Company and the Surviving Acquiror), further agree that, as to all legally privileged communications prior to the Acquisition Merger Closing (made in connection with the negotiation, preparation, execution, delivery and performance under, or any dispute or Action arising out of or relating to, this Agreement, any other Transaction Document or the transactions contemplated hereby or thereby) between or among Acquiror, the Sponsor and/or any other member of the Acquiror Group, on the one hand, and Loeb, on the other hand, the attorney/client privilege and the expectation of client confidence shall survive the Mergers and belong to the Acquiror Group after the Acquisition Merger Closing, and shall not pass to or be claimed or controlled by the Surviving Company, the Surviving Acquiror and PubCo. Notwithstanding the foregoing, any privileged communications or information shared by the Company prior to the Acquisition Merger Closing with Acquiror or the Sponsor under a common interest agreement shall remain the privileged communications or information of the Company.
(b) PubCo, Acquiror and the Company, on behalf of their respective successors and assigns (including, after the Acquisition Merger Closing, the Surviving Company and the Surviving Acquiror), hereby agree that, in the event a dispute with respect to this Agreement or the transactions contemplated hereby arises after the Acquisition Merger Closing between or among (x) the shareholders or holders of other equity interests of the Company and/or any of its directors, members, partners, officers, employees or Affiliates (other than the Surviving Company, the Surviving Acquiror and PubCo) (collectively, the “Company Group”), on the one hand, and (y) the Surviving Company, the Surviving Acquiror, PubCo and/or any member of the Acquiror Group, on the other hand, any legal counsel, including DLA Piper (“DLA”) that represented the Company prior to the Acquisition Merger Closing may represent any member of the Company Group in such dispute even though the interests of such Persons may be directly adverse to the Surviving Company, the Surviving Acquiror or PubCo, and even though such counsel may have represented Acquiror, the Company and/or Merger Sub in a matter substantially related to such dispute, or may be handling ongoing matters for the Surviving Company, the Surviving Acquiror or PubCo. Acquiror, the Company and Merger Sub, on behalf of their respective successors and assigns (including, after the Acquisition Merger Closing, PubCo the Surviving Company and the Surviving Acquiror), further agree that, as to all legally privileged communications prior to the Acquisition Merger Closing (made in connection with the negotiation, preparation, execution, delivery and performance under, or any dispute or Action arising out of or relating to, this Agreement, any other Transaction Documents or the transactions contemplated hereby or thereby) between or among the Company, Merger Sub and/or any member of the Company Group, on the one hand, and DLA, on the other hand, the attorney/client privilege and the expectation of client confidence shall survive the Mergers and belong to the Company Group after the Acquisition Merger Closing, and shall not pass to or be claimed or controlled by the Surviving Company, the Surviving Acquiror and PubCo. Notwithstanding the foregoing, any privileged communications or information shared by the Sponsor prior to the Acquisition Merger Closing with the Company under a common interest agreement shall remain the privileged communications or information of the Sponsor.
[Remainder of page intentionally left blank]
82
IN WITNESS WHEREOF the Parties have hereunto caused this Agreement to be duly executed as of the date first above written.
| CSLM III HOLDINGS LTD | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
83
IN WITNESS WHEREOF the Parties have hereunto caused this Agreement to be duly executed as of the date first above written.
| CSLM DIGITAL ASSET ACQUISITION CORP III, LTD | |||
| By: | /s/ Vik Mittal | ||
| Name: | Vik Mittal | ||
| Title: | Chairman and Co-Chief Executive Officer | ||
84
IN WITNESS WHEREOF the Parties have hereunto caused this Agreement to be duly executed as of the date first above written.
| FIRST DIGITAL GROUP LTD. | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
85
EXHIBIT A
FORM OF PUBCO CHARTER
A-1
EXHIBIT B
COMPANY SHAREHOLDERS SUPPORT AGREEMENT
B-1
EXHIBIT C
SPONSOR SUPPORT AGREEMENT
C-2
EXHIBIT D
FORM OF REGISTRATION RIGHTS AGREEMENT
D-1
EXHIBIT E
FORM OF LOCK-UP AGREEMENT
E-1
EXHIBIT F
FORM OF SPONSOR WARRANT
F-1
EXHIBIT G
FORM OF JOINDER AGREEMENT
G-1
EXHIBIT H
FORM OF BINANCE PUBCO WARRANT
H-1
EXHIBIT I
FORM OF NOBLE ELITE PUBCO WARRANT
I-1
Schedule 1
Earn-Out Summary
Attached.
Sch. 1-1
Exhibit 10.1
COMPANY SHAREHOLDER SUPPORT AGREEMENT
This Company Shareholder Support Agreement (this “Agreement”) is made and entered into as of [●], 2026, by and among (i) First Digital Group Ltd., a Gibraltar private company limited by shares with registration number 121963 (the “Company”), (ii) Nemi Limited (the “Requisite Company Shareholder”), and (iii) CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares with registration number 412434 (the “Acquiror”). The Company, Acquiror, and the Requisite Company Shareholder are sometimes referred to herein as a “Party” and collectively as the “Parties”. Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Business Combination Agreement (as defined below).
RECITALS
A. On [●], 2026, Acquiror and the Company entered into a Business Combination Agreement (the “Business Combination Agreement”) pursuant to which, upon the terms and subject to the conditions set forth therein: (a) at least one (1) Business Day prior to the Reincorporation Merger, the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Reincorporation Merger and the Re-domiciliation and Continuation and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo and the outstanding securities of the Company immediately prior to the Acquisition Merger Effective Time being converted into securities of PubCo (the Mergers together with the other transactions contemplated by the Business Combination Agreement, the “Transactions”).
B. The Requisite Company Shareholder agrees to enter into this Agreement with respect to all Company Ordinary Shares and/or Company Preferred Shares (collectively, “Company Shares”) of which the Requisite Company Shareholder now or hereafter has beneficial ownership (as such term is defined in Rule 13d-3 under the Exchange Act) and/or record ownership (excluding the Transferred Shares (as defined below)) (all such Company Shares, together with any shares in the Company of which beneficial and/or record ownership and/or the power to vote (including, without limitation, by proxy or power of attorney) is hereafter acquired by the Requisite Company Shareholder (or any securities convertible into or exercisable or exchangeable for Company Shares) during the period from the date hereof through the Expiration Time (in any event, other than the Transferred Shares) are collectively referred to herein as the “Subject Shares”).
C. As a condition to the willingness of Acquiror and the Company to enter into the Business Combination Agreement and as an inducement and in consideration therefor, the Requisite Company Shareholder has agreed to enter into this Agreement.
D. Each of the Parties has determined that it is in its best interests to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree as follows:
1. Definitions. When used in this Agreement, the following terms in all of their tenses, cases and correlative forms shall have the meanings assigned to them in this Section 1 or elsewhere in this Agreement.
“Expiration Time” shall mean the earliest to occur of (a) the Acquisition Merger Effective Time, (b) such date and time as the Business Combination Agreement shall be terminated in accordance with Section 11.1 thereof and (c) the mutual written agreement of Acquiror, the Company and the Requisite Company Shareholder.
“Transfer” shall mean (i) any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, or entry into any contract, agreement, option or other arrangement or understanding with respect to any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, in each case directly or indirectly and voluntarily or involuntarily, of any interest owned by a person or any interest (including a beneficial interest) in, or the ownership, control or possession of, or establishing or increasing a put equivalent position or liquidating or decreasing a call equivalent position within the meaning of Section 16 of the Exchange Act, with respect to any interest owned by a person, (ii) any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any interest owned by a person or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii), excluding in each case entry into this Agreement and the Business Combination Agreement and the consummation of the transactions contemplated hereby and thereby.
2. Agreement to Retain the Subject Shares.
2.1 No Transfer of Subject Shares. Until the Expiration Time, the Requisite Company Shareholder agrees not to (x) Transfer any Subject Shares or (y) deposit any Subject Shares into a voting trust or enter into a voting agreement with respect to any Subject Shares or grant any proxy (except as otherwise provided herein), consent or power of attorney with respect thereto (other than pursuant to this Agreement). Notwithstanding the foregoing, (A) if the Requisite Company Shareholder is an individual, the Requisite Company Shareholder may Transfer any such Subject Shares (i) to any member of the Requisite Company Shareholder’s immediate family, or to a trust for the benefit of the Requisite Company Shareholder or any member of the Requisite Company Shareholder’s immediate family, the sole trustees of which are the Requisite Company Shareholder or any member of the Requisite Company Shareholder’s immediate family, (ii) by will, other testamentary document or under the laws of intestacy upon the death of the Requisite Company Shareholder, (iii) pursuant to a qualified domestic relations order or (iv) pursuant to a charitable gift or contribution, (B) if the Requisite Company Shareholder is an entity, the Requisite Company Shareholder may Transfer any Subject Shares to any partner, member, shareholder, or affiliate of the Requisite Company Shareholder in accordance with the terms of the Governing Documents of the Company, (C) the Requisite Company Shareholder may Transfer any Subject Shares upon the consent of Acquiror and (D) the Requisite Company Shareholder may Transfer any Company Shares to holders of FDG Tokens in accordance with the terms and conditions of the FDG Tokens and/or to Black Spade in accordance with the Black Spade Agreement (the Company Shares so transferred, the “Transferred Shares”); provided, that in each case of (A), (B) and (C), such transferee of such Subject Shares evidences in a writing, in form and substance reasonably satisfactory to Acquiror and the Company, such transferee’s agreement to be bound by and subject to all of the terms and provisions hereof to the same effect as such transferring Requisite Company Shareholder, prior and as a condition to the occurrence of such Transfer.
2.2 Additional Purchases. Until the Expiration Time, other than with respect to the Transferred Shares, the Requisite Company Shareholder agrees that any Subject Shares that the Requisite Company Shareholder purchases, that are issued to the Requisite Company Shareholder by the Company, that are otherwise hereinafter acquired by the Requisite Company Shareholder or with respect to which the Requisite Company Shareholder otherwise acquires sole or shared voting power (including by proxy or power of attorney) after the execution of this Agreement and prior to the Expiration Time, shall in each case be subject to the terms and conditions of this Agreement to the same extent as if they were Subject Shares owned by the Requisite Company Shareholder as of the date hereof. The Requisite Company Shareholder agrees, while this Agreement is in effect, to notify Acquiror and the Company promptly in writing (including by e-mail) of the number of any additional Subject Shares acquired, or over which voting power is acquired, by the Requisite Company Shareholder, if any, after the date hereof.
2
2.3 Unpermitted Transfers. Any Transfer or attempted Transfer of any Subject Shares in violation of this Section 2 shall, to the fullest extent permitted by applicable Law, be null and void ab initio.
3. Voting of Subject Shares. Hereafter until the Expiration Time, the Requisite Company Shareholder hereby unconditionally and irrevocably agrees that, at any meeting of the shareholders of the Company (or any adjournment or postponement thereof), and in any action by written consent of the shareholders of the Company requested by the Governing Documents of the Company or otherwise undertaken as contemplated by the Transactions (which written consent shall be delivered promptly, and in any event not later than two (2) Business Days, after the Company requests such delivery), the Requisite Company Shareholder shall: if a meeting is held, attend and appear at the meeting, in person or by proxy, or otherwise cause its Subject Shares to be counted as present thereat for purposes of establishing a quorum, and the Requisite Company Shareholder shall vote all of the Subject Shares to which the Requisite Company Shareholder has sole or shared voting power and is entitled to vote; and/or if a written consent or approval is requested, duly and promptly execute and provide such written consent or approval (or cause to be voted or so consented or approved), in person or by proxy, in respect of all of its Subject Shares: (i) in favor of (a) the Acquisition Merger, the Business Combination Agreement, the Transaction Documents, any required amendments to the Company’s Governing Documents, the PubCo Charter, and all of the other Transactions (including the issuance of PubCo Class B Shares to the Company Founder) (and any actions required in furtherance thereof), and (b) in favor of the other matters set forth in the Business Combination Agreement (including the Company Shareholder Approval, the Re-domiciliation and Continuation Shareholder Approval, and any other shareholder approval of the Transaction Documents or related matters that may be solicited by the Company Board) (clauses (a) and (b) collectively, the “Company Shareholder Approval Matters”), or if there are insufficient votes in favor of granting the approval of the Company Shareholder Approval Matters, in favor of the adjournment or postponement of such meeting of the shareholders of the Company to a later date, and (ii) in opposition to, other than as contemplated by the Business Combination Agreement, (x) any proposal, offer, or submission with respect to an Acquiror Acquisition Proposal or Alternative Proposal (“Competing Transaction”) or the adoption of any agreement to enter into a Competing Transaction, or (y) any proposal, action or agreement that would (A) frustrate, prevent or nullify any provision of this Agreement, the Business Combination Agreement, the Transaction Documents or the Mergers or any of the transactions contemplated hereby and thereby, (B) result in a breach in any respect of any covenant, representation, warranty or any other obligation or agreement of the Company under the Business Combination Agreement or (C) result in any of the conditions set forth in Article X of the Business Combination Agreement not being fulfilled, in each case of (x) and (y), other than those events or transactions as contemplated under the Business Combination Agreement or the other Transaction Documents; and (iii) in any other circumstances upon which a vote, consent or other approval with respect to the Company Shareholder Approval Matters is sought, to vote, consent or approve (or cause to be voted, consented or approved) all of the Requisite Company Shareholder’s Subject Shares held at such time in favor of the foregoing; provided, however, that the Requisite Company Shareholder shall not be required to vote or provide consent or take any other action, in each case to the extent any such vote, consent or other action would preclude SEC registration of the PubCo Ordinary Shares being issued to holders of Company Ordinary Shares as contemplated by the Business Combination Agreement.
4. Additional Agreements.
4.1 No Challenges. The Requisite Company Shareholder agrees not to commence, join in, facilitate, assist or encourage, and agrees to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Acquiror, Merger Sub, PubCo, the Company or any of their respective successors or directors (a) challenging the validity of, or seeking to enjoin the operation of, any provision of this Agreement or (b) alleging a breach of any fiduciary duty of any person in connection with the evaluation, negotiation or entry into the Business Combination Agreement or any other agreement in connection with the Transactions. The Requisite Company Shareholder hereby grants any consent or approval that may be required from them for the Business Combination Agreement or the Transactions under any applicable Contract binding on the Requisite Company Shareholder, the Company or Acquiror.
3
4.2 Further Actions. The Requisite Company Shareholder agrees, while this Agreement is in effect, not to take or omit to take, or agree to commit to take or omit to take, any action that would make any representation and warranty of the Requisite Company Shareholder contained in this Agreement inaccurate in any material respect. The Requisite Company Shareholder further agrees that it shall use its reasonable best efforts to cooperate with Acquiror and the Company to effect the transactions contemplated hereby and the Transactions, including to take or omit to take such actions, and execute such agreements, as may be reasonably requested by Acquiror or the Company in connection with the transactions contemplated hereby and the Transactions or that are necessary to give further effect thereto.
4.3 Consent to Disclosure. The Requisite Company Shareholder hereby consents to the publication and disclosure in the Proxy/Registration Statement (and, as and to the extent otherwise required by applicable securities Laws or the SEC or any other securities authorities, any other documents or communications provided by Acquiror, PubCo or the Company to any Governmental Authority or to securityholders of Acquiror) of the Requisite Company Shareholder’s identity and beneficial ownership of the Subject Shares and the nature of the Requisite Company Shareholder’s commitments, arrangements and understandings under and relating to this Agreement and, if deemed appropriate by Acquiror, PubCo or the Company, a copy of this Agreement. The Requisite Company Shareholder will promptly provide any information reasonably requested by Acquiror, PubCo or the Company for any regulatory application or filing made or approval sought in connection with the Transactions (including filings with the SEC).
4.4 Waiver of Dissenters’ Rights. The Requisite Company Shareholder hereby irrevocably waives, and agrees not to exercise or assert, any dissenters’ rights under Section 238 of the Companies Act (as Revised) of the Cayman Islands and any other similar statute in connection with the Transactions and the Business Combination Agreement.
4.5 No Redemption. The Requisite Company Shareholder undertakes that, from the date hereof and until the Expiration Time, it will not elect to cause the Company to redeem any Subject Shares now or at any time legally or beneficially owned by the Requisite Company Shareholder (whether pursuant to the Governing Documents of the Company, Law, contract or otherwise, notwithstanding the Requisite Company Shareholder may have rights thereunder), or submit or surrender any of its Subject Shares for redemption.
4.6 New Shares. In the event that prior to the Expiration Time, other than with respect to the Transferred Shares, (i) any equity securities of the Company are issued or otherwise distributed to the Requisite Company Shareholder pursuant to any share dividend or distribution, or any change in any of the Subject Shares or other share capital the Company by reason of any share subdivision, recapitalization, consolidation, exchange of shares or the like, (ii) the Requisite Company Shareholder acquires legal or beneficial ownership of any Company Shares after the date of this Agreement, or (iii) the Requisite Company Shareholder acquires the right to vote or share in the voting of any Company Shares after the date of this Agreement (collectively, the “New Securities”), the term “Subject Shares” shall be deemed to refer to and include such New Securities (including all such share dividends and distributions and any securities into which or for which any or all of the Subject Shares may be changed or exchanged into).
4.7 Shareholders’ Consent, Authorization or Approval. The Requisite Company Shareholder hereby irrevocably agrees and confirms that, insofar as (i) the Requisite Company Shareholder’s consent, authorization or approval is required or solicited, or (ii) the Requisite Company Shareholder forms part of a class of shareholders of the Company whose consent, authorization or approval is required, in any such case in respect of or in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, including pursuant to the Governing Documents of the Company or applicable Laws, the Requisite Company Shareholder hereby grants, provides and gives such consent, authorization or approval, and all specific resolutions that may be required to have been adopted by the Requisite Company Shareholder or class of shareholders in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, are hereby deemed adopted and approved by the Requisite Company Shareholder, in each case subject to such amendment, modification or supplement thereof as may be agreed to and adopted by the Company Board from time to time in its sole discretion so long as such amendment, modification or supplement does not have a material and disproportionate adverse impact on the Requisite Company Shareholder as to other similarly situated shareholders of the Company.
4
5. Representations and Warranties of the Requisite Company Shareholder. The Requisite Company Shareholder hereby, severally and not jointly, represents and warrants to Acquiror, the Company and PubCo as follows:
5.1 Ownership of the Company Shares. The Requisite Company Shareholder is either (a) the owner of the Company Shares indicated on Schedule A hereto opposite the Requisite Company Shareholder’s name, free and clear of any and all Liens, other than (i) those created by this Agreement or (ii) as may be set forth in the Governing Documents of the Company or (b) has the power to vote (including by proxy or power of attorney) the Company Shares indicated on Schedule A hereto opposite the Requisite Company Shareholder’s name. The Requisite Company Shareholder has as of the date hereof and, except pursuant to a Transfer permitted in accordance with Section 2.1 hereof, will have until the Expiration Time, sole or shared voting power (including the right to control such vote as contemplated herein), power of disposition, power to issue instructions with respect to the matters set forth in this Agreement and power to agree to all of the matters applicable to the Requisite Company Shareholder set forth in this Agreement, in each case, over all Subject Shares. As of the date hereof, the Requisite Company Shareholder does not own any other voting securities of the Company or have the power to vote (including by proxy or power of attorney) any other voting securities of the Company other than the Company Shares set forth on Schedule A opposite the Requisite Company Shareholder’s name. As of the date hereof, the Requisite Company Shareholder does not own any rights to purchase or acquire (i) any other equity securities of the Company or (ii) the power to vote any other voting securities of the Company, in each case except as set forth on Schedule A opposite the Requisite Company Shareholder’s name. There are no claims for finder’s fees or brokerage commissions or other like payments in connection with this Agreement or the transactions contemplated hereby payable by the Requisite Company Shareholder pursuant to arrangements made by the Requisite Company Shareholder.
5.2 Absence of Other Voting Agreement. Except for this Agreement, the Requisite Company Shareholder has not: (a) entered into any voting agreement, voting trust or similar agreement with respect to any Subject Shares or other equity securities of the Company owned by the Requisite Company Shareholder or (b) granted any proxy, consent or power of attorney with respect to any Subject Shares or other equity securities of the Company owned by the Requisite Company Shareholder (other than as contemplated by this Agreement).
5.3 Due Authority. The Requisite Company Shareholder has the full power and authority to make, enter into and carry out the terms of this Agreement. This Agreement has been duly and validly executed and delivered by the Requisite Company Shareholder (and, if the Requisite Company Shareholder is married and any of the Requisite Company Shareholder’s Subject Shares constitute community property or otherwise need spousal or other approval for this Agreement to be valid and binding, the Requisite Company Shareholder’s spouse), and constitutes a valid and binding agreement of the Requisite Company Shareholder enforceable against it in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar Laws of general applicability relating to or affecting creditor’s rights, and to general equitable principles). If this Agreement is being executed in a representative or fiduciary capacity, the Person signing this Agreement has full power and authority to enter into this Agreement on behalf of the Requisite Company Shareholder.
5.4 No Conflict; Consents.
(a) The execution and delivery of this Agreement by the Requisite Company Shareholder does not, and the performance by the Requisite Company Shareholder of the obligations under this Agreement and the compliance by the Requisite Company Shareholder with the provisions hereof do not and will not: (i) conflict with or violate any Law applicable to the Requisite Company Shareholder, (ii) contravene or conflict with, or result in any violation or breach of, any provision of any charter, certificate of incorporation, limited liability company agreement, certificate of formation, articles of association, by-laws, operating agreement or similar formation or governing documents and instruments of the Requisite Company Shareholder, as applicable, or (iii) result in any breach of or constitute a default (or an event that 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, or result in the creation of a Lien on any of the Subject Shares owned by the Requisite Company Shareholder pursuant to any contract or agreement to which the Requisite Company Shareholder is a party or by which the Requisite Company Shareholder is bound, except in the case of clause (i) or (iii) as would not reasonably be expected, either individually or in the aggregate, to materially impair the ability of the Requisite Company Shareholder to perform its obligations hereunder or to consummate the transactions contemplated hereby.
5
(b) No consent, approval, order or authorization of, or registration, declaration or filing with, any Governmental Authority or any other person is required by or with respect to the Requisite Company Shareholder in connection with the execution and delivery of this Agreement or the consummation by the Requisite Company Shareholder of the transactions contemplated hereby. If the Requisite Company Shareholder is a natural person, no consent of the Requisite Company Shareholder’s spouse is necessary under any “community property” or other Laws in order for the Requisite Company Shareholder to enter into and perform its obligations under this Agreement.
5.5 Absence of Litigation. As of the date hereof, there is no Action pending or, to the knowledge of the Requisite Company Shareholder, threatened, against the Requisite Company Shareholder that would reasonably be expected to impair, enjoin or materially delay the ability of the Requisite Company Shareholder to perform the Requisite Company Shareholder’s obligations hereunder or to consummate the transactions contemplated hereby.
5.6 Reliance by Acquiror, the Company and PubCo. The Requisite Company Shareholder understands and acknowledges that each of Acquiror, the Company and PubCo is entering into the Business Combination Agreement in reliance upon the Requisite Company Shareholder’s execution and delivery of this Agreement.
5.7 Adequate Information. The Requisite Company Shareholder is a sophisticated shareholder and has adequate information concerning the business and financial condition of Acquiror and the Company to make an informed decision regarding this Agreement and the Transactions, and has independently, without reliance upon Acquiror or the Company, and based on such information as the Requisite Company Shareholder has deemed appropriate, made its own analysis and decision to enter into this Agreement. The Requisite Company Shareholder acknowledges that none of Acquiror or the Company has made or makes any representation or warranty, whether express or implied, of any kind or character with respect to the matters covered herein, in each case except as expressly set forth in this Agreement. The Requisite Company Shareholder acknowledges that the agreements contained herein with respect to the Subject Shares held by the Requisite Company Shareholder are irrevocable.
6. Termination. This Agreement shall terminate upon the Expiration Time. The termination of this Agreement shall not relieve any party from any liability arising in respect of any willful and material breach of this Agreement prior to such termination.
7. Miscellaneous.
7.1 Further Assurances. From time to time, at another Party’s request and without further consideration, each Party shall execute and deliver such additional documents and take all such further action as may be reasonably necessary or desirable to consummate the transactions contemplated by this Agreement.
7.2 Fees and Expenses. Each of the Parties shall be responsible for its own fees and expenses (including, without limitation, the fees and expenses of investment bankers, accountants and counsel) in connection with the entering into of this Agreement and the consummation of the transactions contemplated hereby; provided that the fees and expenses of the Company and Acquiror shall be allocated as set forth in Section 12.6 of the Business Combination Agreement.
7.3 No Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in Acquiror, PubCo or the Merger Sub any direct or indirect ownership or incidence of ownership of or with respect to any Subject Shares.
7.4 Amendments, Waivers. This Agreement may not be amended except by an instrument in writing signed by each of the Parties hereto. At any time prior to the Expiration Time,
(a) Acquiror may (i) extend the time for the performance of any obligation or other act of any Requisite Company Shareholder, (ii) waive any inaccuracy in the representations and warranties of the Requisite Company Shareholder contained herein or in any document delivered by any Requisite Company Shareholder pursuant hereto and (iii) waive compliance with any agreement of the Requisite Company Shareholder or any condition to their obligations contained herein and any such extension or waiver shall be valid if set forth in an instrument in writing signed by Acquiror;
6
(b) the Requisite Company Shareholder may (i) extend the time for the performance of any obligation or other act of Acquiror or the Company, (ii) waive any inaccuracy in the representations and warranties of Acquiror or the Company contained herein or in any document delivered by Acquiror or the Company pursuant hereto and (iii) waive compliance with any agreement of Acquiror or the Company or any condition to their obligations contained herein.
7.5 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by email or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 7.5):
if to Acquiror:
CSLM Digital Asset Acquisition Corp III, Ltd
2400 E. Commercial Boulevard, Suite 900
Ft. Lauderdale, FL 33308
Attention: Vik Mittal
Email: vik@meteoracapital.com
with copies (which shall not constitute notice) to:
Loeb & Loeb LLP
345 Park Avenue
New York, NY
Attn: Mitchell S. Nussbaum
Email: mnussbaum@loeb.com
if to the Company:
First Digital Group Ltd.
Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong
Attention: Vincent Chok; Legal Department
Email: v.chok@1stDigital.com; legal@1stDigital.com
with copies (which shall not constitute notice) to:
DLA Piper LLP
20th Floor, South Tower, Beijing Kerry Center
1 Guanghua Road
Chaoyang District
Beijing 100020
China
| Attn: | Yang Ge | |
| James Chang |
| Telephone No.: | +86 10 8520 0616 | |
| +86 10 8520 0608 |
| Email: | yang.ge@dlapiper.com | |
| james.chang@dlapiper.com |
if to the Requisite Company Shareholder, to the address for notice set forth on Schedule A hereto,
7
7.6 Headings. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.
7.7 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby or any of the other Transactions is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.
7.8 Entire Agreement; Assignment. This Agreement and the schedules hereto (together with each transaction document in connection with the Transactions to which the Parties hereto are parties, to the extent referred to herein) constitute the entire agreement among the Parties with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, among the Parties, or any of them, with respect to the subject matter hereof. Except for transfers permitted by Section 2.1, this Agreement shall not be assigned (whether pursuant to a merger, by operation of law or otherwise) by any Party without the prior express written consent of the other Parties hereto.
7.9 Certificates. To the extent applicable, promptly following the date of this Agreement, the Company shall advise its transfer agent in writing that the Requisite Company Shareholder’s Subject Shares are subject to the restrictions set forth herein and, in connection therewith, provide the transfer agent of the Company, as applicable, in writing with such information as is reasonable to ensure compliance with such restrictions.
7.10 Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each Party, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
7.11 Interpretation.
(a) Unless the context of this Agreement otherwise requires, (i) words of any gender include each other gender, (ii) words using the singular or plural number also include the plural or singular number, respectively, (iii) the definitions contained in this agreement are applicable to the other grammatical forms of such terms, (iv) the terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words refer to this entire Agreement, (v) the terms “Section” and “Schedule” refer to the specified Section or Schedule of or to this Agreement, (vi) the word “including” means “including without limitation,” (vii) the word “or” shall be disjunctive but not exclusive, (viii) the word “person” means an individual, corporation, partnership, limited partnership, limited liability company, syndicate, person (including, without limitation, a “person” as defined in Section 13(d)(3) of the Exchange Act), trust, association or entity or government, political subdivision, agency or instrumentality of a government, and references to a person are also to its permitted successors and assigns, (ix), an “affiliate” of a specified person means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified person, (x) references to agreements and other documents shall be deemed to include all subsequent amendments and other modifications thereto and references to any Law shall include all rules and regulations promulgated thereunder and (xi) references to any Law shall be construed as including all statutory, legal, and regulatory provisions consolidating, amending or replacing such Law.
(b) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent and no rule of strict construction shall be applied against any Party.
8
7.12 Governing Law. This Agreement shall be governed by, and construed in accordance with, the Laws of the State of New York applicable to contracts executed in and to be performed in that State, without giving effect to principles or rules of conflict of Laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction. All legal actions and proceedings arising out of or relating to this Agreement shall be heard and determined exclusively in any federal and state courts located in the City of New York, Borough of Manhattan (the “Specified Courts”). The Parties hereby (a) irrevocably submit to the exclusive jurisdiction of the aforesaid Specified Courts for themselves and with respect to their respective properties for the purpose of any Action arising out of or relating to this Agreement brought by any Party, and (b) agree not to commence any Action relating thereto except in the Specified Courts, other than Actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by any such Specified Courts. Each of the Parties further agrees that notice as provided herein shall constitute sufficient service of process and the Parties further waive any argument that such service is insufficient. Each of the Parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any Action arising out of or relating to this Agreement or the transactions contemplated hereby any claim (a) that it is not personally subject to the jurisdiction of the Specified Courts for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such Specified Court or from any legal process commenced in such Specified Courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the Action in any such Specified Court is brought in an inconvenient forum, (ii) the venue of such Action is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such Specified Courts.
7.13 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof, and, accordingly, that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in the Specified Courts without proof of actual damages or otherwise, in addition to any other remedy to which they are entitled at law or in equity as expressly permitted in this Agreement. Each of the Parties hereby further waives (a) any defense in any action for specific performance that a remedy at law would be adequate and (b) any requirement under any Law to post security or a bond as a prerequisite to obtaining equitable relief.
7.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.14.
7.15 Counterparts; Electronic Delivery. This Agreement may be executed and delivered (including by facsimile or portable document format (.pdf) transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery by email to counsel for the other Parties of a counterpart executed by a Party shall be deemed to meet the requirements of the previous sentence.
7.16 Directors and Officers. Nothing in this Agreement shall be construed to impose any obligation or limitation on votes or actions taken by any director, officer, employee, agent, designee or other representative of the Requisite Company Shareholder, in each case, in his or her capacity as a director or officer of the Company or any of its Subsidiaries. The Requisite Company Shareholder is executing this Agreement solely in such capacity as a record or beneficial holder of Company Shares.
[Remainder of Page Intentionally Left Blank]
9
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| ACQUIROR: | |||
| CSLM Digital Asset Acquisition Corp III, Ltd | |||
| By: | /s/ Vik Mittal | ||
| Name: | Vik Mittal | ||
| Title: | Chairman and Co-Chief Executive Officer | ||
10
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| COMPANY: | |||
| First Digital Group Ltd. | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
11
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| REQUISITE COMPANY SHAREHOLDER: | |||
| NEMI LIMITED | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
12
Schedule A
Requisite Company Shareholder
| Requisite Company Shareholder | Company Preference Shares | Notice Address |
| Nemi Limited | 9,271,446 | Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong |
Sch. A-1
Exhibit 10.2
COMPANY SHAREHOLDER SUPPORT AGREEMENT
This Company Shareholder Support Agreement (this “Agreement”) is made and entered into as of [●], 2026, by and among (i) First Digital Group Ltd., a Gibraltar private company limited by shares with registration number 121963 (the “Company”), (ii) each shareholder of the Company as set forth on Schedule A (each, a “Requisite Company Shareholder”), and (iii) CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares with registration number 412434 (the “Acquiror”). The Company, Acquiror, and the Requisite Company Shareholders are sometimes referred to herein as a “Party” and collectively as the “Parties”. Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Business Combination Agreement (as defined below).
RECITALS
A. On [●], 2026, Acquiror and the Company entered into a Business Combination Agreement (the “Business Combination Agreement”) pursuant to which, upon the terms and subject to the conditions set forth therein: (a) at least one (1) Business Day prior to the Reincorporation Merger, the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Reincorporation Merger and the Re-domiciliation and Continuation and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo and the outstanding securities of the Company immediately prior to the Acquisition Merger Effective Time being converted into securities of PubCo (the Mergers together with the other transactions contemplated by the Business Combination Agreement, the “Transactions”).
B. The Requisite Company Shareholders agree to enter into this Agreement with respect to all Company Ordinary Shares and/or Company Preferred Shares (collectively, “Company Shares”) of which the Requisite Company Shareholders now or hereafter have beneficial ownership (as such term is defined in Rule 13d-3 under the Exchange Act) and/or record ownership.
C. As of the date hereof, the Requisite Company Shareholders are the owners of, and/or have voting power (including, without limitation, by proxy or power of attorney) over, such number and class of Company Shares as are indicated opposite each of their names on Schedule A attached hereto (all such Company Shares, together with any shares in the Company of which beneficial and/or record ownership and/or the power to vote (including, without limitation, by proxy or power of attorney) is hereafter acquired by any such Requisite Company Shareholder (or any securities convertible into or exercisable or exchangeable for Company Shares) during the period from the date hereof through the Expiration Time are collectively referred to herein as the “Subject Shares”).
D. As a condition to the willingness of Acquiror and the Company to enter into the Business Combination Agreement and as an inducement and in consideration therefor, the Requisite Company Shareholders have agreed to enter into this Agreement.
E. Each of the Parties has determined that it is in its best interests to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree as follows:
1. Definitions. When used in this Agreement, the following terms in all of their tenses, cases and correlative forms shall have the meanings assigned to them in this Section 1 or elsewhere in this Agreement.
“Expiration Time” shall mean the earliest to occur of (a) the Acquisition Merger Effective Time, (b) such date and time as the Business Combination Agreement shall be terminated in accordance with Section 11.1 thereof and (c) the mutual written agreement of Acquiror, the Company and such Requisite Company Shareholder.
“Transfer” shall mean (i) any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, or entry into any contract, agreement, option or other arrangement or understanding with respect to any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, in each case directly or indirectly and voluntarily or involuntarily, of any interest owned by a person or any interest (including a beneficial interest) in, or the ownership, control or possession of, or establishing or increasing a put equivalent position or liquidating or decreasing a call equivalent position within the meaning of Section 16 of the Exchange Act, with respect to any interest owned by a person, (ii) any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any interest owned by a person or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii), excluding in each case entry into this Agreement and the Business Combination Agreement and the consummation of the transactions contemplated hereby and thereby.
2. Agreement to Retain the Subject Shares.
2.1 No Transfer of Subject Shares. Until the Expiration Time, each Requisite Company Shareholder agrees not to (x) Transfer any Subject Shares or (y) deposit any Subject Shares into a voting trust or enter into a voting agreement with respect to any Subject Shares or grant any proxy (except as otherwise provided herein), consent or power of attorney with respect thereto (other than pursuant to this Agreement). Notwithstanding the foregoing, (A) if a Requisite Company Shareholder is an individual, such Requisite Company Shareholder may Transfer any such Subject Shares (i) to any member of such Requisite Company Shareholder’s immediate family, or to a trust for the benefit of such Requisite Company Shareholder or any member of such Requisite Company Shareholder’s immediate family, the sole trustees of which are such Requisite Company Shareholder or any member of such Requisite Company Shareholder’s immediate family, (ii) by will, other testamentary document or under the laws of intestacy upon the death of such Requisite Company Shareholder, (iii) pursuant to a qualified domestic relations order or (iv) pursuant to a charitable gift or contribution, (B) if a Requisite Company Shareholder is an entity, such Requisite Company Shareholder may Transfer any Subject Shares to any partner, member, shareholder, or affiliate of such Requisite Company Shareholder in accordance with the terms of the Governing Documents of the Company, and (C) a Requisite Company Shareholder may Transfer any Subject Shares upon the consent of Acquiror; provided, that in each case such transferee of such Subject Shares evidences in a writing, in form and substance reasonably satisfactory to Acquiror and the Company, such transferee’s agreement to be bound by and subject to all of the terms and provisions hereof to the same effect as such transferring Requisite Company Shareholder, prior and as a condition to the occurrence of such Transfer. Notwithstanding anything to the contrary in this Agreement, the Company Founder may transfer 813,500 Company Preference Shares to Noble Elite Ltd. at any time prior to the Expiration Time without the consent of Acquiror or any other Person.
2.2 Additional Purchases. Until the Expiration Time, each Requisite Company Shareholder agrees that any Subject Shares that such Requisite Company Shareholder purchases, that are issued to such Requisite Company Shareholder by the Company, that are otherwise hereinafter acquired by such Requisite Company Shareholder or with respect to which such Requisite Company Shareholder otherwise acquires sole or shared voting power (including by proxy or power of attorney) after the execution of this Agreement and prior to the Expiration Time, shall in each case be subject to the terms and conditions of this Agreement to the same extent as if they were Subject Shares owned by such Requisite Company Shareholder as of the date hereof. Each of the Requisite Company Shareholders agrees, while this Agreement is in effect, to notify Acquiror and the Company promptly in writing (including by e-mail) of the number of any additional Subject Shares acquired, or over which voting power is acquired, by such Requisite Company Shareholder, if any, after the date hereof.
2
2.3 Unpermitted Transfers. Any Transfer or attempted Transfer of any Subject Shares in violation of this Section 2 shall, to the fullest extent permitted by applicable Law, be null and void ab initio.
3. Voting of Subject Shares. Hereafter until the Expiration Time, each Requisite Company Shareholder hereby unconditionally and irrevocably agrees that, at any meeting of the shareholders of the Company (or any adjournment or postponement thereof), and in any action by written consent of the shareholders of the Company requested by the Governing Documents of the Company or otherwise undertaken as contemplated by the Transactions (which written consent shall be delivered promptly, and in any event not later than two (2) Business Days, after the Company requests such delivery), such Requisite Company Shareholder shall: if a meeting is held, attend and appear at the meeting, in person or by proxy, or otherwise cause its Subject Shares to be counted as present thereat for purposes of establishing a quorum, and such Requisite Company Shareholder shall vote all of the Subject Shares to which such Requisite Company Shareholder has sole or shared voting power and is entitled to vote; and/or if a written consent or approval is requested, duly and promptly execute and provide such written consent or approval (or cause to be voted or so consented or approved), in person or by proxy, in respect of all of its Subject Shares: (i) in favor of (a) the Acquisition Merger, the Business Combination Agreement, the Transaction Documents, any required amendments to the Company’s Governing Documents, the PubCo Charter, and all of the other Transactions (including the issuance of PubCo Class B Shares to the Company Founder) (and any actions required in furtherance thereof), and (b) in favor of the other matters set forth in the Business Combination Agreement (including the Company Shareholder Approval, the Re-domiciliation and Continuation Shareholder Approval, and any other shareholder approval of the Transaction Documents or related matters that may be solicited by the Company Board) (clauses (a) and (b) collectively, the “Company Shareholder Approval Matters”), or if there are insufficient votes in favor of granting the approval of the Company Shareholder Approval Matters, in favor of the adjournment or postponement of such meeting of the shareholders of the Company to a later date, and (ii) in opposition to, other than as contemplated by the Business Combination Agreement, (x) any proposal, offer, or submission with respect to an Acquiror Acquisition Proposal or Alternative Proposal (“Competing Transaction”) or the adoption of any agreement to enter into a Competing Transaction, or (y) any proposal, action or agreement that would (A) frustrate, prevent or nullify any provision of this Agreement, the Business Combination Agreement, the Transaction Documents or the Mergers or any of the transactions contemplated hereby and thereby, (B) result in a breach in any respect of any covenant, representation, warranty or any other obligation or agreement of the Company under the Business Combination Agreement or (C) result in any of the conditions set forth in Article X of the Business Combination Agreement not being fulfilled, in each case of (x) and (y), other than those events or transactions as contemplated under the Business Combination Agreement or the other Transaction Documents; and (iii) in any other circumstances upon which a vote, consent or other approval with respect to the Company Shareholder Approval Matters is sought, to vote, consent or approve (or cause to be voted, consented or approved) all of such Requisite Company Shareholder’s Subject Shares held at such time in favor of the foregoing; provided, however, that such Requisite Company Shareholder shall not be required to vote or provide consent or take any other action, in each case to the extent any such vote, consent or other action would preclude SEC registration of the PubCo Ordinary Shares being issued to holders of Company Ordinary Shares as contemplated by the Business Combination Agreement.
4. Additional Agreements.
4.1 No Challenges. Each Requisite Company Shareholder agrees not to commence, join in, facilitate, assist or encourage, and agrees to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Acquiror, Merger Sub, PubCo, the Company or any of their respective successors or directors (a) challenging the validity of, or seeking to enjoin the operation of, any provision of this Agreement or (b) alleging a breach of any fiduciary duty of any person in connection with the evaluation, negotiation or entry into the Business Combination Agreement or any other agreement in connection with the Transactions. Each Requisite Company Shareholder hereby grants any consent or approval that may be required from them for the Business Combination Agreement or the Transactions under any applicable Contract binding on such Requisite Company Shareholder, the Company or Acquiror.
3
4.2 Further Actions. Each Requisite Company Shareholder agrees, while this Agreement is in effect, not to take or omit to take, or agree to commit to take or omit to take, any action that would make any representation and warranty of such Requisite Company Shareholder contained in this Agreement inaccurate in any material respect. Each Requisite Company Shareholder further agrees that it shall use its reasonable best efforts to cooperate with Acquiror and the Company to effect the transactions contemplated hereby and the Transactions, including to take or omit to take such actions, and execute such agreements, as may be reasonably requested by Acquiror or the Company in connection with the transactions contemplated hereby and the Transactions or that are necessary to give further effect thereto.
4.3 Consent to Disclosure. Each Requisite Company Shareholder hereby consents to the publication and disclosure in the Proxy/Registration Statement (and, as and to the extent otherwise required by applicable securities Laws or the SEC or any other securities authorities, any other documents or communications provided by Acquiror, PubCo or the Company to any Governmental Authority or to securityholders of Acquiror) of such Requisite Company Shareholder’s identity and beneficial ownership of the Subject Shares and the nature of such Requisite Company Shareholder’s commitments, arrangements and understandings under and relating to this Agreement and, if deemed appropriate by Acquiror, PubCo or the Company, a copy of this Agreement. Each Requisite Company Shareholder will promptly provide any information reasonably requested by Acquiror, PubCo or the Company for any regulatory application or filing made or approval sought in connection with the Transactions (including filings with the SEC).
4.4 Waiver of Dissenters’ Rights. Each Requisite Company Shareholder hereby irrevocably waives, and agrees not to exercise or assert, any dissenters’ rights under Section 238 of the Companies Act (as Revised) of the Cayman Islands and any other similar statute in connection with the Transactions and the Business Combination Agreement.
4.5 No Redemption. Each of the Requisite Company Shareholders undertakes that, from the date hereof and until the Expiration Time, it will not elect to cause the Company to redeem any Subject Shares now or at any time legally or beneficially owned by such Requisite Company Shareholder (whether pursuant to the Governing Documents of the Company, Law, contract or otherwise, notwithstanding such Requisite Company Shareholder may have rights thereunder), or submit or surrender any of its Subject Shares for redemption.
4.6 New Shares. In the event that prior to the Expiration Time (i) any equity securities of the Company are issued or otherwise distributed to a Requisite Company Shareholder pursuant to any share dividend or distribution, or any change in any of the Subject Shares or other share capital the Company by reason of any share subdivision, recapitalization, consolidation, exchange of shares or the like, (ii) a Requisite Company Shareholder acquires legal or beneficial ownership of any Company Shares after the date of this Agreement, or (iii) a Requisite Company Shareholder acquires the right to vote or share in the voting of any Company Shares after the date of this Agreement (collectively, the “New Securities”), the term “Subject Shares” shall be deemed to refer to and include such New Securities (including all such share dividends and distributions and any securities into which or for which any or all of the Subject Shares may be changed or exchanged into).
4.7 Shareholders’ Consent, Authorization or Approval. Each Requisite Company Shareholder hereby irrevocably agrees and confirms that, insofar as (i) such Requisite Company Shareholder’s consent, authorization or approval is required or solicited, or (ii) such Requisite Company Shareholder forms part of a class of shareholders of the Company whose consent, authorization or approval is required, in any such case in respect of or in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, including pursuant to the Governing Documents of the Company or applicable Laws, such Requisite Company Shareholder hereby grants, provides and gives such consent, authorization or approval, and all specific resolutions that may be required to have been adopted by such Requisite Company Shareholder or class of shareholders in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, are hereby deemed adopted and approved by such Requisite Company Shareholder, in each case subject to such amendment, modification or supplement thereof as may be agreed to and adopted by the Company Board from time to time in its sole discretion so long as such amendment, modification or supplement does not have a material or disproportionate adverse impact on the Requisite Company Shareholder as to other similarly situated shareholders of the Company.
4
5. Representations and Warranties of the Requisite Company Shareholders. Each Requisite Company Shareholder hereby, severally and not jointly, represents and warrants to Acquiror, the Company and PubCo as follows:
5.1 Ownership of the Company Shares. Such Requisite Company Shareholder is either (a) the owner of the Company Shares indicated on Schedule A hereto opposite such Requisite Company Shareholder’s name, free and clear of any and all Liens, other than (i) those created by this Agreement or (ii) as may be set forth in the Governing Documents of the Company or (b) has the power to vote (including by proxy or power of attorney) the Company Shares indicated on Schedule A hereto opposite such Requisite Company Shareholder’s name. Such Requisite Company Shareholder has as of the date hereof and, except pursuant to a Transfer permitted in accordance with Section 2.1 hereof, will have until the Expiration Time, sole or shared voting power (including the right to control such vote as contemplated herein), power of disposition, power to issue instructions with respect to the matters set forth in this Agreement and power to agree to all of the matters applicable to such Requisite Company Shareholder set forth in this Agreement, in each case, over all Subject Shares. As of the date hereof, such Requisite Company Shareholder does not own any other voting securities of the Company or have the power to vote (including by proxy or power of attorney) any other voting securities of the Company other than the Company Shares set forth on Schedule A opposite such Requisite Company Shareholder’s name. As of the date hereof, such Requisite Company Shareholder does not own any rights to purchase or acquire (i) any other equity securities of the Company or (ii) the power to vote any other voting securities of the Company, in each case except as set forth on Schedule A opposite such Requisite Company Shareholder’s name. There are no claims for finder’s fees or brokerage commissions or other like payments in connection with this Agreement or the transactions contemplated hereby payable by such Requisite Company Shareholder pursuant to arrangements made by such Requisite Company Shareholder.
5.2 Absence of Other Voting Agreement. Except for this Agreement, such Requisite Company Shareholder has not: (a) entered into any voting agreement, voting trust or similar agreement with respect to any Subject Shares or other equity securities of the Company owned by such Requisite Company Shareholder or (b) granted any proxy, consent or power of attorney with respect to any Subject Shares or other equity securities of the Company owned by such Requisite Company Shareholder (other than as contemplated by this Agreement).
5.3 Due Authority. Such Requisite Company Shareholder has the full power and authority to make, enter into and carry out the terms of this Agreement. This Agreement has been duly and validly executed and delivered by such Requisite Company Shareholder (and, if such Requisite Company Shareholder is married and any of such Requisite Company Shareholder’s Subject Shares constitute community property or otherwise need spousal or other approval for this Agreement to be valid and binding, such Requisite Company Shareholder’s spouse), and constitutes a valid and binding agreement of such Requisite Company Shareholder enforceable against it in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar Laws of general applicability relating to or affecting creditor’s rights, and to general equitable principles). If this Agreement is being executed in a representative or fiduciary capacity, the Person signing this Agreement has full power and authority to enter into this Agreement on behalf of such Requisite Company Shareholder.
5.4 No Conflict; Consents.
(a) The execution and delivery of this Agreement by such Requisite Company Shareholder does not, and the performance by such Requisite Company Shareholder of the obligations under this Agreement and the compliance by such Requisite Company Shareholder with the provisions hereof do not and will not: (i) conflict with or violate any Law applicable to such Requisite Company Shareholder, (ii) contravene or conflict with, or result in any violation or breach of, any provision of any charter, certificate of incorporation, limited liability company agreement, certificate of formation, articles of association, by-laws, operating agreement or similar formation or governing documents and instruments of such Requisite Company Shareholder, as applicable, or (iii) result in any breach of or constitute a default (or an event that 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, or result in the creation of a Lien on any of the Subject Shares owned by such Requisite Company Shareholder pursuant to any contract or agreement to which such Requisite Company Shareholder is a party or by which such Requisite Company Shareholder is bound, except in the case of clause (i) or (iii) as would not reasonably be expected, either individually or in the aggregate, to materially impair the ability of such Requisite Company Shareholder to perform its obligations hereunder or to consummate the transactions contemplated hereby.
5
(b) No consent, approval, order or authorization of, or registration, declaration or filing with, any Governmental Authority or any other person is required by or with respect to such Requisite Company Shareholder in connection with the execution and delivery of this Agreement or the consummation by such Requisite Company Shareholder of the transactions contemplated hereby. If such Requisite Company Shareholder is a natural person, no consent of such Requisite Company Shareholder’s spouse is necessary under any “community property” or other Laws in order for such Requisite Company Shareholder to enter into and perform its obligations under this Agreement.
5.5 Absence of Litigation. As of the date hereof, there is no Action pending or, to the knowledge of such Requisite Company Shareholder, threatened, against such Requisite Company Shareholder that would reasonably be expected to impair, enjoin or materially delay the ability of such Requisite Company Shareholder to perform such Requisite Company Shareholder’s obligations hereunder or to consummate the transactions contemplated hereby.
5.6 Reliance by Acquiror, the Company and PubCo. Such Requisite Company Shareholder understands and acknowledges that each of Acquiror, the Company and PubCo is entering into the Business Combination Agreement in reliance upon such Requisite Company Shareholder’s execution and delivery of this Agreement.
5.7 Adequate Information. Such Requisite Company Shareholder is a sophisticated shareholder and has adequate information concerning the business and financial condition of Acquiror and the Company to make an informed decision regarding this Agreement and the Transactions, and has independently, without reliance upon Acquiror or the Company, and based on such information as such Requisite Company Shareholder has deemed appropriate, made its own analysis and decision to enter into this Agreement. Such Requisite Company Shareholder acknowledges that none of Acquiror or the Company has made or makes any representation or warranty, whether express or implied, of any kind or character with respect to the matters covered herein, in each case except as expressly set forth in this Agreement. Such Requisite Company Shareholder acknowledges that the agreements contained herein with respect to the Subject Shares held by such Requisite Company Shareholder are irrevocable.
6. Termination. This Agreement shall terminate upon the Expiration Time. The termination of this Agreement shall not relieve any party from any liability arising in respect of any willful and material breach of this Agreement prior to such termination.
7. Miscellaneous.
7.1 Further Assurances. From time to time, at another Party’s request and without further consideration, each Party shall execute and deliver such additional documents and take all such further action as may be reasonably necessary or desirable to consummate the transactions contemplated by this Agreement.
7.2 Fees and Expenses. Each of the Parties shall be responsible for its own fees and expenses (including, without limitation, the fees and expenses of investment bankers, accountants and counsel) in connection with the entering into of this Agreement and the consummation of the transactions contemplated hereby; provided that the fees and expenses of the Company and Acquiror shall be allocated as set forth in Section 12.6 of the Business Combination Agreement.
7.3 No Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in Acquiror, PubCo or the Merger Sub any direct or indirect ownership or incidence of ownership of or with respect to any Subject Shares.
7.4 Amendments, Waivers. This Agreement may not be amended except by an instrument in writing signed by each of the Parties hereto. At any time prior to the Expiration Time,
(a) Acquiror may (i) extend the time for the performance of any obligation or other act of any Requisite Company Shareholder, (ii) waive any inaccuracy in the representations and warranties of each Requisite Company Shareholder contained herein or in any document delivered by any Requisite Company Shareholder pursuant hereto and (iii) waive compliance with any agreement of each Requisite Company Shareholder or any condition to their obligations contained herein and any such extension or waiver shall be valid if set forth in an instrument in writing signed by Acquiror;
6
(b) the Requisite Company Shareholders may (i) extend the time for the performance of any obligation or other act of Acquiror or the Company, (ii) waive any inaccuracy in the representations and warranties of Acquiror or the Company contained herein or in any document delivered by Acquiror or the Company pursuant hereto and (iii) waive compliance with any agreement of Acquiror or the Company or any condition to their obligations contained herein.
7.5 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by email or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 7.5):
if to Acquiror:
CSLM Digital Asset Acquisition Corp III, Ltd
2400 E. Commercial Boulevard, Suite 900
Ft. Lauderdale, FL 33308
Attention: Vik Mittal
Email: vik@meteoracapital.com
with copies (which shall not constitute notice) to:
Loeb & Loeb LLP
345 Park Avenue
New York, NY
Attn: Mitchell S. Nussbaum
Email: mnussbaum@loeb.com
if to the Company:
First Digital Group Ltd.
Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong
Attention: Vincent Chok; Legal Department
Email: v.chok@1stDigital.com; legal@1stDigital.com
with copies (which shall not constitute notice) to:
DLA Piper LLP
20th Floor, South Tower, Beijing Kerry Center
1 Guanghua Road
Chaoyang District
Beijing 100020
China
| Attn: | Yang Ge | |
| James Chang |
| Telephone No.: | +86 10 8520 0616 | |
| +86 10 8520 0608 |
| Email: | yang.ge@dlapiper.com | |
| james.chang@dlapiper.com |
if to any Requisite Company Shareholder, to the address for notice set forth on Schedule A hereto,
7
7.6 Headings. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.
7.7 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby or any of the other Transactions is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.
7.8 Entire Agreement; Assignment. This Agreement and the schedules hereto (together with each transaction document in connection with the Transactions to which the Parties hereto are parties, to the extent referred to herein) constitute the entire agreement among the Parties with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, among the Parties, or any of them, with respect to the subject matter hereof. Except for transfers permitted by Section 2.1, this Agreement shall not be assigned (whether pursuant to a merger, by operation of law or otherwise) by any Party without the prior express written consent of the other Parties hereto.
7.9 Certificates. To the extent applicable, promptly following the date of this Agreement, the Company shall advise its transfer agent in writing that each Requisite Company Shareholder’s Subject Shares are subject to the restrictions set forth herein and, in connection therewith, provide the transfer agent of the Company, as applicable, in writing with such information as is reasonable to ensure compliance with such restrictions.
7.10 Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each Party, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
7.11 Interpretation.
(a) Unless the context of this Agreement otherwise requires, (i) words of any gender include each other gender, (ii) words using the singular or plural number also include the plural or singular number, respectively, (iii) the definitions contained in this agreement are applicable to the other grammatical forms of such terms, (iv) the terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words refer to this entire Agreement, (v) the terms “Section” and “Schedule” refer to the specified Section or Schedule of or to this Agreement, (vi) the word “including” means “including without limitation,” (vii) the word “or” shall be disjunctive but not exclusive, (viii) the word “person” means an individual, corporation, partnership, limited partnership, limited liability company, syndicate, person (including, without limitation, a “person” as defined in Section 13(d)(3) of the Exchange Act), trust, association or entity or government, political subdivision, agency or instrumentality of a government, and references to a person are also to its permitted successors and assigns, (ix), an “affiliate” of a specified person means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified person, (x) references to agreements and other documents shall be deemed to include all subsequent amendments and other modifications thereto and references to any Law shall include all rules and regulations promulgated thereunder and (xi) references to any Law shall be construed as including all statutory, legal, and regulatory provisions consolidating, amending or replacing such Law.
(b) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent and no rule of strict construction shall be applied against any Party.
8
7.12 Governing Law. This Agreement shall be governed by, and construed in accordance with, the Laws of the State of New York applicable to contracts executed in and to be performed in that State, without giving effect to principles or rules of conflict of Laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction. All legal actions and proceedings arising out of or relating to this Agreement shall be heard and determined exclusively in any federal and state courts located in the City of New York, Borough of Manhattan (the “Specified Courts”). The Parties hereby (a) irrevocably submit to the exclusive jurisdiction of the aforesaid Specified Courts for themselves and with respect to their respective properties for the purpose of any Action arising out of or relating to this Agreement brought by any Party, and (b) agree not to commence any Action relating thereto except in the Specified Courts, other than Actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by any such Specified Courts. Each of the Parties further agrees that notice as provided herein shall constitute sufficient service of process and the Parties further waive any argument that such service is insufficient. Each of the Parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any Action arising out of or relating to this Agreement or the transactions contemplated hereby any claim (a) that it is not personally subject to the jurisdiction of the Specified Courts for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such Specified Court or from any legal process commenced in such Specified Courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the Action in any such Specified Court is brought in an inconvenient forum, (ii) the venue of such Action is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such Specified Courts.
7.13 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof, and, accordingly, that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in the Specified Courts without proof of actual damages or otherwise, in addition to any other remedy to which they are entitled at law or in equity as expressly permitted in this Agreement. Each of the Parties hereby further waives (a) any defense in any action for specific performance that a remedy at law would be adequate and (b) any requirement under any Law to post security or a bond as a prerequisite to obtaining equitable relief.
7.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.14.
7.15 Counterparts; Electronic Delivery. This Agreement may be executed and delivered (including by facsimile or portable document format (.pdf) transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery by email to counsel for the other Parties of a counterpart executed by a Party shall be deemed to meet the requirements of the previous sentence.
7.16 Directors and Officers. Nothing in this Agreement shall be construed to impose any obligation or limitation on votes or actions taken by any director, officer, employee, agent, designee or other representative of any Requisite Company Shareholder or by any Requisite Company Shareholder that is a natural person, in each case, in his or her capacity as a director or officer of the Company or any of its Subsidiaries. Each Requisite Company Shareholder is executing this Agreement solely in such capacity as a record or beneficial holder of Company Shares.
[Remainder of Page Intentionally Left Blank]
9
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| ACQUIROR: | |||
| CSLM DIGITAL ASSET ACQUISITION CORP III, LTD | |||
| By: | /s/ Vik Mittal | ||
| Name: | Vik Mittal | ||
| Title: | Chairman and Co-Chief Executive Officer | ||
10
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| COMPANY: | |||
| FIRST DIGITAL GROUP LTD. | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
11
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| REQUISITE COMPANY SHAREHOLDERS: | |||
| VINCENT CHOK | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| NOBLE ELITE LTD. | |||
| By: | /s/ Ip Siu Wai Eva | ||
| Name: | Ip Siu Wai Eva | ||
| Title: | Director | ||
12
Schedule A
Requisite Company Shareholders
|
Requisite Company Shareholder |
Company Ordinary/Preference Shares |
Notice Address |
| Vincent Chok |
1,300 (Company Ordinary Shares)
19,050,788 (Company Preference Shares) |
Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong |
| Noble Elite Ltd. | 1,355,826 (Company Preference Shares) |
Maples Corporate Services Limited, PO Box 309, Ugland House, South Church Street, Grand Cayman, KY1-1104, Cayman Islands
c/o Suite 3613, 36/F, Two Pacific Place, 88 Queensway, Hong Kong |
| Total: |
1,300 (Company Ordinary Shares)
20,406,614 (Company Preference Shares) |
N/A |
Sch. A-1
Exhibit 10.3
SPONSOR SUPPORT AGREEMENT
This Sponsor Support Agreement (this “Agreement”) is made and entered into as of October 6, 2026, by and among (i) First Digital Group Ltd., a Gibraltar private company limited by shares with registration number 121963 (the “Company”), (ii) CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted limited liability company (the “Sponsor”), and (iii) CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares with registration number 412434 (the “Acquiror”). The Company, Acquiror, and the Sponsor are sometimes referred to herein as a “Party” and collectively as the “Parties”. Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Business Combination Agreement (as defined below).
RECITALS
A. On October 6, 2026, Acquiror and the Company entered into a Business Combination Agreement (the “Business Combination Agreement”) pursuant to which, upon the terms and subject to the conditions set forth therein: (a) at least one (1) Business Day prior to the Reincorporation Merger, the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Reincorporation Merger and the Re-domiciliation and Continuation and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo and the outstanding securities of the Company immediately prior to the Acquisition Merger Effective Time being converted into securities of PubCo (the Mergers together with the other transactions contemplated by the Business Combination Agreement, the “Transactions”).
B. The Sponsor agrees to enter into this Agreement with respect to all Acquiror Ordinary Shares of which the Sponsor now or hereafter has beneficial ownership (as such term is defined in Rule 13d-3 under the Exchange Act) and/or record ownership.
C. As of the date hereof, the Sponsor is the owner of, and has voting power (including, without limitation, by proxy or power of attorney) over, such number of Acquiror Ordinary Shares as are indicated opposite each of their names on Schedule A attached hereto (all such Acquiror Ordinary Shares, together with any shares in the Acquiror of which beneficial and/or record ownership and/or the power to vote (including, without limitation, by proxy or power of attorney) is hereafter acquired by the Sponsor (or any securities convertible into or exercisable or exchangeable for Acquiror Ordinary Shares) during the period from the date hereof through the Expiration Time are collectively referred to herein as the “Subject Shares”).
D. As a condition to the willingness of Acquiror and the Company to enter into the Business Combination Agreement and as an inducement and in consideration therefor, the Sponsor has agreed to enter into this Agreement.
E. Each of the Parties has determined that it is in its best interests to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree as follows:
1. Definitions. When used in this Agreement, the following terms in all of their tenses, cases and correlative forms shall have the meanings assigned to them in this Section 1 or elsewhere in this Agreement.
“Expiration Time” shall mean the earliest to occur of (a) the Acquisition Merger Effective Time, (b) such date and time as the Business Combination Agreement shall be terminated in accordance with Section 11.1 thereof and (c) the mutual written agreement of Acquiror, the Company and the Sponsor.
“Transfer” shall mean (i) any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, or entry into any contract, agreement, option or other arrangement or understanding with respect to any sale, assignment, encumbrance, pledge, hypothecation, disposition, loan or other transfer, in each case directly or indirectly and voluntarily or involuntarily, of any interest owned by a person or any interest (including a beneficial interest) in, or the ownership, control or possession of, or establishing or increasing a put equivalent position or liquidating or decreasing a call equivalent position within the meaning of Section 16 of the Exchange Act, with respect to any interest owned by a person, (ii) any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any interest owned by a person or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii), excluding in each case entry into this Agreement and the Business Combination Agreement and the consummation of the transactions contemplated hereby and thereby.
2. Agreement to Retain the Subject Shares.
2.1 No Transfer of Subject Shares. Until the Expiration Time, the Sponsor agrees not to (x) Transfer any Subject Shares or (y) deposit any Subject Shares into a voting trust or enter into a voting agreement with respect to any Subject Shares or grant any proxy (except as otherwise provided herein), consent or power of attorney with respect thereto (in each case, other than pursuant to this Agreement and in furtherance of the Business Combination Agreement and the transactions contemplated hereby and thereby). Notwithstanding the foregoing, (A) the Sponsor may Transfer any Subject Shares to any partner, member, shareholder, or affiliate of the Sponsor in accordance with the terms of the Governing Documents of the Sponsor as in effect as of the date hereof, and (B) the Sponsor may Transfer any Subject Shares upon the consent of Company; provided, that in each case such transferee of such Subject Shares evidences in a writing, in form and substance reasonably satisfactory to the Company, such transferee’s agreement to be bound by and subject to all of the terms and provisions hereof to the same effect as the Sponsor, prior and as a condition to the occurrence of such Transfer.
2.2 Additional Purchases. Until the Expiration Time, the Sponsor agrees that any Subject Shares that the Sponsor purchases, that are issued to the Sponsor by the Acquiror, that are otherwise hereinafter acquired by the Sponsor or with respect to which the Sponsor otherwise acquires sole or shared voting power (including by proxy or power of attorney) after the execution of this Agreement and prior to the Expiration Time, shall in each case be subject to the terms and conditions of this Agreement to the same extent as if they were Subject Shares owned by the Sponsor as of the date hereof, subject to compliance with applicable securities laws. The Sponsor agrees, while this Agreement is in effect, to notify the Company promptly in writing (including by e-mail) of the number of any additional Subject Shares acquired, or over which voting power is acquired, by the Sponsor, if any, after the date hereof.
2.3 Unpermitted Transfers. Any Transfer or attempted Transfer of any Subject Shares in violation of this Section 2 shall, to the fullest extent permitted by applicable Law, be null and void ab initio.
2
3. Voting of Subject Shares. Hereafter until the Expiration Time, the Sponsor hereby unconditionally and irrevocably agrees that, at any meeting of the shareholders of the Acquiror (or any adjournment or postponement thereof), and in any action by written consent of the shareholders of the Acquiror requested by the Governing Documents of the Acquiror or otherwise undertaken as contemplated by the Transactions (which written consent shall be delivered promptly, and in any event not later than two (2) Business Days, after the Acquiror requests such delivery), the Sponsor shall: if a meeting is held, attend and appear at the meeting, in person or by proxy, or otherwise cause its Subject Shares to be counted as present thereat for purposes of establishing a quorum, and the Sponsor shall vote all of the Subject Shares to which the Sponsor has sole or shared voting power and is entitled to vote; and/or if a written consent or approval is requested, duly and promptly execute and provide such written consent or approval (or cause to be voted or so consented or approved), in person or by proxy, in respect of all of its Subject Shares: (i) in favor of (a) the Reincorporation Merger, the Acquisition Merger, the Business Combination Agreement, the Transaction Documents, any required amendments to the Acquiror’s Governing Documents, the PubCo Charter, and all of the other Transactions (including the issuance of PubCo Class B Shares to the Company Founder) (and any actions required in furtherance thereof), and (b) in favor of the other matters set forth in the Business Combination Agreement (including the Transaction Proposals, the Acquiror Shareholders’ Approval, the Reincorporation Merger, and any other shareholder approval of the Transaction Documents or related matters that may be solicited by the Acquiror Board) (clauses (a) and (b) collectively, the “Acquiror Shareholder Approval Matters”), or if there are insufficient votes in favor of granting the approval of the Acquiror Shareholder Approval Matters, in favor of the adjournment or postponement of such meeting of the shareholders of the Acquiror to a later date, and (ii) in opposition to, other than as contemplated by the Business Combination Agreement, (x) any proposal, offer, or submission with respect to an Acquiror Acquisition Proposal or Alternative Proposal (“Competing Transaction”) or the adoption of any agreement to enter into a Competing Transaction, or (y) any proposal, action or agreement that would (A) frustrate, prevent or nullify any provision of this Agreement, the Business Combination Agreement, the Transaction Documents or the Mergers or any of the transactions contemplated hereby and thereby, (B) result in a breach in any respect of any covenant, representation, warranty or any other obligation or agreement of the Acquiror under the Business Combination Agreement or (C) result in any of the conditions set forth in Article X of the Business Combination Agreement not being fulfilled, in each case of (x) and (y), other than those events or transactions as contemplated under the Business Combination Agreement or the other Transaction Documents; and (iii) in any other circumstances upon which a vote, consent or other approval with respect to the Acquiror Shareholder Approval Matters is sought, to vote, consent or approve (or cause to be voted, consented or approved) all of the Sponsor’s Subject Shares held at such time in favor of the foregoing; provided, however, that the Sponsor shall not be required to vote or provide consent or take any other action, in each case to the extent any such vote, consent or other action would preclude SEC registration of the PubCo Ordinary Shares being issued to holders of Acquiror Ordinary Shares as contemplated by the Business Combination Agreement.
4. Additional Agreements.
4.1 No Challenges. The Sponsor agrees not to commence, join in, facilitate, assist or encourage, and agrees to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against Acquiror, Merger Sub, PubCo, the Company or any of their respective successors or directors (a) challenging the validity of, or seeking to enjoin the operation of, any provision of this Agreement or (b) alleging a breach of any fiduciary duty of any person in connection with the evaluation, negotiation or entry into the Business Combination Agreement or any other agreement in connection with the Transactions; provided, however, that the Sponsor may take any action to enforce or claim damages as a result of any willful breach of the Business Combination Agreement or this Agreement occurring prior to its termination. The Sponsor hereby grants any consent or approval that may be required from them for the Business Combination Agreement or the Transactions under any applicable Contract binding on the Sponsor, the Company or Acquiror.
3
4.2 Further Actions. The Sponsor agrees, while this Agreement is in effect, not to take or omit to take, or agree to commit to take or omit to take, any action that would make any representation and warranty of the Sponsor contained in this Agreement inaccurate in any material respect. The Sponsor further agrees that it shall use its reasonable best efforts to cooperate with Acquiror or the Company to effect the transactions contemplated hereby and the Transactions, including to take or omit to take such actions, and execute such agreements, as may be reasonably requested by Acquiror or the Company in connection with the transactions contemplated hereby and the Transactions or that are necessary to give further effect thereto. The Sponsor also undertakes that it shall exercise its power, to the extent applicable, either through voting or otherwise to procure that the Acquiror’s approval as the sole shareholder of PubCo and Merger Sub as contemplated by Section 9.2(d) of the Business Combination Agreement be obtained in accordance with Section 9.2(d) of the Business Combination Agreement.
4.3 Consent to Disclosure. The Sponsor hereby consents to the publication and disclosure in the Proxy/Registration Statement (and, as and to the extent otherwise required by applicable securities Laws or the SEC or any other securities authorities, any other documents or communications provided by Acquiror, PubCo or the Company to any Governmental Authority or to securityholders of Acquiror) of the Sponsor’s identity and beneficial ownership of the Subject Shares and the nature of the Sponsor’s commitments, arrangements and understandings under and relating to this Agreement and, if deemed appropriate by Acquiror, PubCo or the Company, a copy of this Agreement. The Sponsor will promptly provide any information reasonably requested by Acquiror, PubCo or the Company for any regulatory application or filing made or approval sought in connection with the Transactions (including filings with the SEC).
4.4 Waiver of Dissenters’ Rights. The Sponsor hereby irrevocably waives, and agrees not to exercise or assert, any dissenters’ rights under Section 238 of the Companies Act (as Revised) of the Cayman Islands and any other similar statute in connection with the Transactions and the Business Combination Agreement.
4.5 No Redemption. The Sponsor undertakes that, from the date hereof and until the Expiration Time, it will not elect to cause the Acquiror to redeem any Subject Shares now or at any time legally or beneficially owned by the Sponsor (whether pursuant to the Governing Documents of the Acquiror, Law, contract or otherwise, notwithstanding the Sponsor may have rights thereunder), or submit or surrender any of its Subject Shares for redemption.
4.6 New Shares. In the event that prior to the Expiration Time (i) any equity securities of the Acquiror are issued or otherwise distributed to the Sponsor pursuant to any share dividend or distribution, or any change in any of the Subject Shares or other share capital the Acquiror by reason of any share subdivision, recapitalization, consolidation, exchange of shares or the like, (ii) the Sponsor acquires legal or beneficial ownership of any Acquiror Ordinary Shares after the date of this Agreement, or (iii) the Sponsor acquires the right to vote or share in the voting of any Acquiror Ordinary Shares after the date of this Agreement (collectively, the “New Securities”), the term “Subject Shares” shall be deemed to refer to and include such New Securities (including all such share dividends and distributions and any securities into which or for which any or all of the Subject Shares may be changed or exchanged into).
4.7 Shareholders’ Consent, Authorization or Approval. The Sponsor hereby irrevocably agrees and confirms that, insofar as (i) the Sponsor’s consent, authorization or approval is required or solicited, or (ii) the Sponsor forms part of a class of shareholders of the Acquiror whose consent, authorization or approval is required, in any such case in respect of or in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, including pursuant to the Governing Documents of the Acquiror or applicable Laws, the Sponsor hereby grants, provides and gives such consent, authorization or approval, and all specific resolutions that may be required to have been adopted by the Sponsor or class of shareholders in connection with the Transactions, the Business Combination Agreement and the other transaction documents contemplated hereby and thereby, are hereby deemed adopted and approved by the Sponsor, in each case subject to such amendment, modification or supplement thereof as may be agreed to and adopted by the Acquiror Board from time to time in its sole discretion so long as such amendment, modification or supplement does not have a material and disproportionate adverse impact on the Sponsor as to other similarly situated shareholders of the Acquiror.
4
4.8 Waiver of Adjustment of Conversion Ratio. The Sponsor, as the holder of a majority of Acquiror Class B Ordinary Shares, hereby waives any adjustment to the Initial Conversion Ratio with respect to the Acquiror Class B Ordinary Shares as provided in Article 58 of the Acquiror Charter with respect to any issuance of the Acquiror Ordinary Shares or other Equity-Linked Securities (as defined in the Acquiror Charter) by the Acquiror in connection with the Transactions or the Business Combination Agreement.
5. Representations and Warranties of the Sponsor. The Sponsor hereby, severally and not jointly, represents and warrants to Acquiror, the Company and PubCo as follows:
5.1 Ownership of the Acquiror Ordinary Shares. The Sponsor is the owner of the Acquiror Ordinary Shares indicated on Schedule A hereto opposite the Sponsor’s name, free and clear of any and all Liens, other than (i) those created by this Agreement or (ii) as may be set forth in the Governing Documents of the Acquiror and has the power to vote (including by proxy or power of attorney) the Acquiror Ordinary Shares indicated on Schedule A hereto opposite the Sponsor’s name. The Sponsor has as of the date hereof and, except pursuant to a Transfer permitted in accordance with Section 2.1 hereof, will have until the Expiration Time, sole or shared voting power (including the right to control such vote as contemplated herein), power of disposition, power to issue instructions with respect to the matters set forth in this Agreement and power to agree to all of the matters applicable to the Sponsor set forth in this Agreement, in each case, over all Subject Shares. As of the date hereof, the Sponsor does not own any other voting securities of the Acquiror or have the power to vote (including by proxy or power of attorney) any other voting securities of the Acquiror other than the Acquiror Ordinary Shares set forth on Schedule A opposite the Sponsor’s name. As of the date hereof, the Sponsor does not own any rights to purchase or acquire (i) any other equity securities of the Acquiror or (ii) the power to vote any other voting securities of the Acquiror, in each case except as set forth on Schedule A opposite the Sponsor’s name. There are no claims for finder’s fees or brokerage commissions or other like payments in connection with this Agreement or the transactions contemplated hereby payable by the Sponsor pursuant to arrangements made by the Sponsor.
5.2 Absence of Other Voting Agreement. Except for this Agreement and except as disclosed in the Acquiror SEC Filings, the Sponsor has not: (a) entered into any voting agreement, voting trust or similar agreement with respect to any Subject Shares or other equity securities of the Acquiror owned by the Sponsor or (b) granted any proxy, consent or power of attorney with respect to any Subject Shares or other equity securities of the Acquiror owned by the Sponsor (other than as contemplated by this Agreement).
5.3 Due Authority. The Sponsor has the full power and authority to make, enter into and carry out the terms of this Agreement. This Agreement has been duly and validly executed and delivered by the Sponsor, and constitutes a valid and binding agreement of the Sponsor enforceable against it in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar Laws of general applicability relating to or affecting creditor’s rights, and to general equitable principles). If this Agreement is being executed in a representative or fiduciary capacity, the Person signing this Agreement has full power and authority to enter into this Agreement on behalf of the Sponsor.
5.4 No Conflict; Consents.
(a) The execution and delivery of this Agreement by the Sponsor does not, and the performance by the Sponsor of the obligations under this Agreement and the compliance by the Sponsor with the provisions hereof do not and will not: (i) conflict with or violate any Law applicable to the Sponsor, (ii) contravene or conflict with, or result in any violation or breach of, any provision of any charter, certificate of incorporation, limited liability company agreement, certificate of formation, articles of association, by-laws, operating agreement or similar formation or governing documents and instruments of the Sponsor, as applicable, or (iii) result in any breach of or constitute a default (or an event that 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, or result in the creation of a Lien on any of the Subject Shares owned by the Sponsor pursuant to any contract or agreement to which the Sponsor is a party or by which the Sponsor is bound, except in the case of clause (i) or (iii) as would not reasonably be expected, either individually or in the aggregate, to materially impair the ability of the Sponsor to perform its obligations hereunder or to consummate the transactions contemplated hereby.
5
(b) No consent, approval, order or authorization of, or registration, declaration or filing with, any Governmental Authority or any other person is required by or with respect to the Sponsor in connection with the execution and delivery of this Agreement or the consummation by the Sponsor of the transactions contemplated hereby.
5.5 Absence of Litigation. As of the date hereof, there is no Action pending or, to the knowledge of the Sponsor, threatened, against the Sponsor that would reasonably be expected to impair, enjoin or materially delay the ability of the Sponsor to perform the Sponsor’s obligations hereunder or to consummate the transactions contemplated hereby.
5.6 Reliance by the Company. The Sponsor understands and acknowledges that the Company is entering into the Business Combination Agreement in reliance upon the Sponsor’s execution and delivery of this Agreement.
5.7 Adequate Information. The Sponsor is a sophisticated shareholder and has adequate information concerning the business and financial condition of Acquiror and the Company to make an informed decision regarding this Agreement and the Transactions, and has independently, without reliance upon Acquiror or the Company, and based on such information as the Sponsor has deemed appropriate, made its own analysis and decision to enter into this Agreement. The Sponsor acknowledges that none of Acquiror or the Company has made or makes any representation or warranty, whether express or implied, of any kind or character with respect to the matters covered herein, in each case except as expressly set forth in this Agreement. The Sponsor acknowledges that the agreements contained herein with respect to the Subject Shares held by the Sponsor are irrevocable.
6. Termination. This Agreement shall terminate upon the Expiration Time. The termination of this Agreement shall not relieve any party from any liability arising in respect of any willful and material breach of this Agreement prior to such termination.
7. Miscellaneous.
7.1 Further Assurances. From time to time, at another Party’s request and without further consideration, each Party shall execute and deliver such additional documents and take all such further action as may be reasonably necessary or desirable to consummate the transactions contemplated by this Agreement.
7.2 Fees and Expenses. Each of the Parties shall be responsible for its own fees and expenses (including, without limitation, the fees and expenses of investment bankers, accountants and counsel) in connection with the entering into of this Agreement and the consummation of the transactions contemplated hereby; provided that the fees and expenses of the Company and Acquiror shall be allocated as set forth in Section 12.6 of the Business Combination Agreement.
7.3 No Ownership Interest. Nothing contained in this Agreement shall be deemed to vest in the Company, PubCo or the Merger Sub any direct or indirect ownership or incidence of ownership of or with respect to any Subject Shares.
7.4 Amendments, Waivers. This Agreement may not be amended except by an instrument in writing signed by each of the Parties hereto. At any time prior to the Expiration Time,
(a) the Company may (i) extend the time for the performance of any obligation or other act of any Sponsor, (ii) waive any inaccuracy in the representations and warranties of the Sponsor contained herein or in any document delivered by any Sponsor pursuant hereto and (iii) waive compliance with any agreement of the Sponsor or any condition to their obligations contained herein and any such extension or waiver shall be valid if set forth in an instrument in writing signed by the Company; and
(b) the Sponsor may (i) extend the time for the performance of any obligation or other act of Acquiror or the Company, (ii) waive any inaccuracy in the representations and warranties of Acquiror or the Company contained herein or in any document delivered by Acquiror or the Company pursuant hereto and (iii) waive compliance with any agreement of Acquiror or the Company or any condition to their obligations contained herein.
6
7.5 Notices. All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by email or by registered or certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 7.5):
if to Acquiror:
CSLM Digital Asset Acquisition Corp III, Ltd
2400 E. Commercial Boulevard, Suite 900
Ft. Lauderdale, FL 33308
Attention: Vik Mittal
Email: vik@meteoracapital.com
with copies (which shall not constitute notice) to:
Loeb & Loeb LLP
345 Park Avenue
New York, NY
Attn: Mitchell S. Nussbaum
Email: mnussbaum@loeb.com
if to the Company:
First Digital Group Ltd.
Room 4001, 40/F., Tower One, Lippo Centre, 89 Queensway, Hong Kong
Attention: Vincent Chok; Legal Department
Email: v.chok@1stDigital.com; legal@1stDigital.com
with copies (which shall not constitute notice) to:
DLA Piper LLP
20th Floor, South Tower, Beijing Kerry Center
1 Guanghua Road
Chaoyang District
Beijing 100020
China
| Attn: | Yang Ge | ||
| James Chang | |||
| Telephone No.: | +86 10 8520 0616 | ||
| +86 10 8520 0608 | |||
| Email: | yang.ge@dlapiper.com | ||
| james.chang@dlapiper.com | |||
if to the Sponsor, to the address for notice set forth on Schedule A hereto,
7.6 Headings. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.
7.7 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby or any of the other Transactions is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.
7
7.8 Entire Agreement; Assignment. This Agreement and the schedules hereto (together with each transaction document in connection with the Transactions to which the Parties hereto are parties, to the extent referred to herein) constitute the entire agreement among the Parties with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, among the Parties, or any of them, with respect to the subject matter hereof. Except for transfers permitted by Section 2.1, this Agreement shall not be assigned (whether pursuant to a merger, by operation of law or otherwise) by any Party without the prior express written consent of the other Parties hereto.
7.9 Certificates. To the extent applicable, promptly following the date of this Agreement, the Acquiror shall advise its transfer agent in writing that the Sponsor’s Subject Shares are subject to the restrictions set forth herein and, in connection therewith, provide the transfer agent of the Acquiror, as applicable, in writing with such information as is reasonable to ensure compliance with such restrictions.
7.10 Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each Party, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
7.11 Interpretation.
(a) Unless the context of this Agreement otherwise requires, (i) words of any gender include each other gender, (ii) words using the singular or plural number also include the plural or singular number, respectively, (iii) the definitions contained in this agreement are applicable to the other grammatical forms of such terms, (iv) the terms “hereof,” “herein,” “hereby,” “hereto” and derivative or similar words refer to this entire Agreement, (v) the terms “Section” and “Schedule” refer to the specified Section or Schedule of or to this Agreement, (vi) the word “including” means “including without limitation,” (vii) the word “or” shall be disjunctive but not exclusive, (viii) the word “person” means an individual, corporation, partnership, limited partnership, limited liability company, syndicate, person (including, without limitation, a “person” as defined in Section 13(d)(3) of the Exchange Act), trust, association or entity or government, political subdivision, agency or instrumentality of a government, and references to a person are also to its permitted successors and assigns, (ix), an “affiliate” of a specified person means a person who, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified person, (x) references to agreements and other documents shall be deemed to include all subsequent amendments and other modifications thereto and references to any Law shall include all rules and regulations promulgated thereunder and (xi) references to any Law shall be construed as including all statutory, legal, and regulatory provisions consolidating, amending or replacing such Law.
(b) The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent and no rule of strict construction shall be applied against any Party.
7.12 Governing Law. This Agreement shall be governed by, and construed in accordance with, the Laws of the State of New York applicable to contracts executed in and to be performed in that State, without giving effect to principles or rules of conflict of Laws to the extent such principles or rules would require or permit the application of Laws of another jurisdiction. All legal actions and proceedings arising out of or relating to this Agreement shall be heard and determined exclusively in any federal and state courts located in the City of New York, Borough of Manhattan (the “Specified Courts”). The Parties hereby (a) irrevocably submit to the exclusive jurisdiction of the aforesaid Specified Courts for themselves and with respect to their respective properties for the purpose of any Action arising out of or relating to this Agreement brought by any Party, and (b) agree not to commence any Action relating thereto except in the Specified Courts, other than Actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by any such Specified Courts. Each of the Parties further agrees that notice as provided herein shall constitute sufficient service of process and the Parties further waive any argument that such service is insufficient. Each of the Parties hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any Action arising out of or relating to this Agreement or the transactions contemplated hereby any claim (a) that it is not personally subject to the jurisdiction of the Specified Courts for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such Specified Court or from any legal process commenced in such Specified Courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the Action in any such Specified Court is brought in an inconvenient forum, (ii) the venue of such Action is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such Specified Courts.
8
7.13 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof, and, accordingly, that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof in the Specified Courts without proof of actual damages or otherwise, in addition to any other remedy to which they are entitled at law or in equity as expressly permitted in this Agreement. Each of the Parties hereby further waives (a) any defense in any action for specific performance that a remedy at law would be adequate and (b) any requirement under any Law to post security or a bond as a prerequisite to obtaining equitable relief.
7.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.14.
7.15 Counterparts; Electronic Delivery. This Agreement may be executed and delivered (including by facsimile or portable document format (.pdf) transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery by email to counsel for the other Parties of a counterpart executed by a Party shall be deemed to meet the requirements of the previous sentence.
7.16 Directors and Officers. Nothing in this Agreement shall be construed to impose any obligation or limitation on votes or actions taken by any director, officer, employee, agent, designee or other representative of the Sponsor in his or her capacity as a director or officer of the Acquiror or any of its Subsidiaries.
[Remainder of Page Intentionally Left Blank]
9
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| ACQUIROR: | |||
| CSLM DIGITAL ASSET ACQUISITION CORP III, LTD | |||
| By: | /s/ Vik Mittal | ||
| Name: | Vik Mittal | ||
| Title: | Chairman and Co-Chief Executive Officer | ||
10
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| COMPANY: | |||
| First Digital Group Ltd. | |||
| By: | /s/ Vincent Chok | ||
| Name: | Vincent Chok | ||
| Title: | Director | ||
11
In witness whereof, the Parties hereto have caused this Agreement to be executed as of the date first set forth above.
| SPONSOR: | |||
| CSLM ACQUISITION SPONSOR II, LTD | |||
| By: | /s/ Vik Mittal | ||
| Name: | Vik Mittal | ||
| Title: | Authorized Signatory | ||
12
Schedule A
Sponsor
| Sponsor | Acquiror Ordinary Shares | Notice Address | |
| CSLM ACQUISITION SPONSOR II, LTD | Acquiror Class A Ordinary Shares | 575,000 | 2400 E. Commercial Boulevard, Suite 900, Ft. Lauderdale, FL 33308 |
| Acquiror Class B Ordinary Shares | 7,566,667 | ||
| Total: | N/A | N/A | |
Sch. A-1
Exhibit 10.4
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of [●], 2026, is made and entered into by and among [PUBCO], a Cayman Islands exempted company limited by shares with registration number 435166 (the “Pubco”), CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted company (the “Sponsor”), Cohen & Company Capital Markets, a division of Cohen & Company Securities, LLC, the representative of the underwriters (the “Representative”) and the undersigned parties listed under Holder on the signature pages hereto (each such party, and any person or entity who hereafter becomes a party to this Agreement pursuant to Section 5.2 of this Agreement, a “Holder” and collectively the “Holders”). Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Business Combination Agreement (as defined below).
RECITALS
WHEREAS, on October 6, 2026, CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company (“Acquiror”), and First Digital Group Ltd., a Gibraltar private company limited by shares (the “Company”) entered into a Business Combination Agreement (the “Business Combination Agreement”) pursuant to which, upon the terms and subject to the conditions set forth therein: (a) at least one (1) Business Day prior to the Reincorporation Merger, the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Reincorporation Merger and the Re-domiciliation and Continuation and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo and the outstanding securities of the Company immediately prior to the Acquisition Merger Effective Time being converted into securities of PubCo (the Mergers together with the other transactions contemplated by the Business Combination Agreement, the “Business Combination”);
WHEREAS, upon the Reincorporation Merger Effective Time, all of the issued and outstanding securities of Acquiror immediately prior to the Reincorporation Merger Effective Time shall no longer be issued and outstanding and shall automatically be cancelled, in exchange for the right of the holders thereof to receive certain securities of PubCo, in each case, upon the terms and subject to the conditions set forth in the Business Combination Agreement and in accordance with the provisions of the Cayman Companies Act and other applicable laws;
WHEREAS, upon the Acquisition Merger Effective Time, each Company Exchanging Share shall automatically be cancelled and converted into, and shall thereafter represent the right of each holder of the Company Exchanging Shares to receive, such number of newly issued PubCo Ordinary Shares as determined in accordance with the Business Combination Agreement;
WHEREAS, as a result of the Business Combination, the Holders were issued certain PubCo Ordinary Shares and/or Warrants on the terms and conditions set forth in the Business Combination Agreement;
WHEREAS, Acquiror, the Sponsor, the Representative, and certain other parties thereto entered into that certain Registration Rights Agreement, dated as of August 26, 2025 (the “Prior Agreement”);
WHEREAS, pursuant to Section 5.5 of the Prior Agreement, upon the written consent of the Acquiror and the holders of at least a majority in interest of the Registrable Securities (as defined in the Prior Agreement) at the time in question (which majority must include the Representative if such amendment or modification is material and adverse to the Representative), compliance with any of the provisions, covenants and conditions set forth in the Prior Agreement may be waived, or any of such provisions, covenants or conditions may be amended or modified; provided, however, that notwithstanding the foregoing, any amendment hereto or waiver hereof that adversely affects any Holder (as defined in the Prior Agreement), solely in his, her or its capacity as a holder of the shares of the Acquiror, in a manner that is materially different from the other such holders (in such capacity) shall require the consent of each such Holder (as defined in the Prior Agreement) so affected;
WHEREAS, in connection with the transactions contemplated by the Business Combination Agreement, the Acquiror, the Sponsor and the Representative, constituting the majority of the holders of Registrable Securities (as defined in the Prior Agreement), desire to amend and restate the Prior Agreement in its entirety, and to enter into this Agreement with Pubco and Holders, pursuant to which the Pubco shall grant the Holders certain registration rights with respect to certain securities of the Pubco held thereby;
NOW, THEREFORE, in consideration of the representations, covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
Article 1
DEFINITIONS
1.1 Definitions. The terms defined in this Article 1 shall, for all purposes of this Agreement, have the respective meanings set forth below:
“Agreement” shall have the meaning given in the Preamble.
“Adverse Disclosure” shall mean any public disclosure of material non-public information, which, in the good faith judgment of the principal executive officer or the principal financial officer of the Pubco, after consultation with outside counsel to the Pubco, (a) would be required to be made in any Registration Statement or Prospectus in order for the applicable Registration Statement or Prospectus not to contain any Misstatement, (b) would not be required to be made at such time but for the filing, effectiveness or continued use of such Registration Statement or Prospectus, as the case may be, and (c) the Pubco has (x) a bona fide business purpose for not making such information public or (y) determined the premature disclosure of such information would materially adversely affect the Pubco.
“Block Trade” shall have the meaning given to it in subsection 2.3.1 of this Agreement.
“Board” shall mean the board of directors of the Pubco.
“Business Combination” shall have the meaning given in the Preamble.
“Commission” shall mean the U.S. Securities and Exchange Commission.
“Company” shall have the meaning given in the Preamble.
“Demanding Holder” shall mean any Holder or group of Holders, that together elects to dispose of Registrable Securities with a total offering price reasonably expected to exceed $25 million at the time of the Underwritten Demand, under a Registration Statement pursuant to an Underwritten Offering.
2
“Effectiveness Period” shall have the meaning given in subsection 3.1.1 of this Agreement.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as it may be amended from time to time.
“Financial Counterparty” shall have the meaning given in subsection 2.3.1 of this Agreement.
“Holders” shall have the meaning given in the Preamble.
“Holder Indemnified Persons” shall have the meaning given in subsection 4.1.1 of this Agreement.
“Lock-Up Agreement” shall mean the Lock-Up Agreement, dated as of the date hereof, by and among the Pubco and the Holders party thereto.
“Lock-Up Period” shall have the meaning ascribed to such term in the Lock-Up Agreement.
“Maximum Number of Securities” shall have the meaning given in subsection 2.1.4 of this Agreement.
“Misstatement” shall mean, in the case of a Registration Statement, an untrue statement of a material fact or an omission to state a material fact required to be stated therein, or necessary to make the statements therein not misleading, and in the case of a Prospectus, an untrue statement of a material fact or an omission to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
“Other Coordinated Offering” shall have the meaning given to it in subsection 2.3.1 of this Agreement.
“Piggyback Registration” shall have the meaning given in subsection 2.2.1 of this Agreement.
“Pro Rata” shall have the meaning given in subsection 2.1.4 of this Agreement.
“Prospectus” shall mean the prospectus (including the preliminary prospectus) included in any Registration Statement, as supplemented by any and all prospectus supplements and as amended by any and all post-effective amendments and including all material incorporated by reference in such prospectus.
“Registrable Security” shall mean (a) any PubCo Ordinary Shares held by a Holder as of the Acquisition Merger Effective Date (including the PubCo Ordinary Shares issued or issuable upon the exercise of the Warrants, or the exercise or conversion of any other equity security issued to a Holder pursuant to the terms of the Business Combination Agreement or the other Transaction Documents), (b) any PubCo Ordinary Shares issued to a Holder following the Acquisition Merger Effective Date pursuant to the terms of the Business Combination Agreement or the other Transaction Documents (including the PubCo Ordinary Shares issued or issuable upon the exercise or conversion of any equity security issued to a Holder pursuant to the terms of the Business Combination Agreement or the other Transaction Documents), (c) any other equity security of the Pubco issued or issuable with respect to any such PubCo Ordinary Shares set forth under the preceding subparagraphs (a) and (b) by way of a share capitalization or share split or in connection with a combination of shares, recapitalization, merger, consolidation or reorganization; provided, however, that, as to any particular Registrable Security, such securities shall cease to be Registrable Securities when: (A) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (B) such securities shall have been otherwise transferred, new certificates for such securities not bearing a legend restricting further transfer shall have been delivered by the Pubco and subsequent public distribution of such securities shall not require registration under the Securities Act; (C) such securities shall have ceased to be outstanding; (D) such securities may be sold without registration pursuant to Rule 144 promulgated under the Securities Act (or any successor rule promulgated thereafter by the Commission) (but with no volume or other restrictions or limitations); or (E) such securities have been sold to, or through, a broker, dealer or underwriter in a public distribution or other public securities transaction.
3
“Registration” shall mean a registration effected by preparing and filing a registration statement or similar document in compliance with the requirements of the Securities Act, and the applicable rules and regulations promulgated thereunder, and any such registration statement having become effective by the Commission.
“Registration Expenses” shall mean the out-of-pocket expenses of a Registration, including, without limitation, the following:
(i) all registration and filing fees (including fees with respect to filings required to be made with the Financial Industry Regulatory Authority) and any securities exchange on which the PubCo Ordinary Shares are then listed;
(ii) fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of counsel for the Underwriters in connection with blue sky qualifications of Registrable Securities);
(iii) printing, messenger, telephone and delivery expenses;
(iv) reasonable fees and disbursements of counsel for the Pubco;
(v) reasonable fees and disbursements of all independent registered public accountants of the Pubco incurred specifically in connection with such Registration or Underwritten Offering;
(vi) the fees and expenses incurred in connection with the listing of any Registrable Securities on each securities exchange or automated quotation system on which similar securities issued by the Pubco are then listed;
(vii) the fees and expenses in relation to the subsequent removal of the restrictive legend from the Registrable Securities;
(viii) the fees and expenses incurred by the Pubco in connection with any road show for any Underwritten Offerings; and
(ix) reasonable fees and expenses of one (1) legal counsel selected jointly by the Demanding Holders initiating an Underwritten Demand, the Requesting Holders participating in an Underwritten Offering and the Holders participating in a Piggyback Registration, as applicable, which fees and expenses shall not exceed USD150,000.
“Registration Statement” shall mean any registration statement under the Securities Act that covers the Registrable Securities pursuant to the provisions of this Agreement, including the Prospectus included in such registration statement, amendments (including post-effective amendments) and supplements to such registration statement and all exhibits to and all material incorporated by reference in such registration statement.
“Representative” shall have the meaning given in the Preamble.
“Requesting Holder” shall have the meaning given in subsection 2.1.3 of this Agreement.
“Securities Act” shall mean the Securities Act of 1933, as amended from time to time.
“Shelf Registration” shall have the meaning given in subsection 2.1.1 of this Agreement.
“Sponsor” shall have the meaning given in the Preamble.
“Suspension Event” shall have the meaning given in Section 3.4 of this Agreement.
4
“Underwriter” shall mean a securities dealer who purchases any Registrable Securities as principal in an Underwritten Offering and not as part of such dealer’s market-making activities.
“Underwritten Demand” shall have the meaning given in subsection 2.1.3 of this Agreement.
“Underwritten Offering” shall mean a Registration in which securities of the Pubco are sold to an Underwriter in a firm commitment underwriting for distribution to the public.
“Warrants” shall mean the PubCo Warrants, the Binance PubCo Warrant, the Noble Elite PubCo Warrant and the Sponsor Warrants.
Article 2
REGISTRATIONS
2.1 Registration.
2.1.1 Shelf Registration. The Pubco agrees that, as soon as practicable but no later than twenty (20) days after the consummation of the Business Combination, the Pubco will use commercially reasonable efforts to file with the Commission (at the Pubco’s sole cost and expense) a Registration Statement on Form F-3 (or, if Form F-3 is not available to be used by PubCo at such time, on Form F-1 or another appropriate form permitting Registration of the relevant Registrable Securities for resale by the Holders) registering the resale or other disposition of the Registrable Securities (a “Shelf Registration”).
2.1.2 Effective Registration. The Pubco shall use commercially reasonable efforts to cause such Registration Statement to become effective by the Commission as soon as reasonably practicable after the initial filing of the Registration Statement and in any event within ninety (90) days following the date of filing thereof. Subject to the limitations contained in this Agreement, the Pubco shall effect any Shelf Registration on such appropriate registration form of the Commission (a) as shall be selected by the Pubco and (b) as shall permit the resale or other disposition of the Registrable Securities by the Holders. If at any time a Registration Statement filed with the Commission pursuant to subsection 2.1.1 is effective and a Holder provides written notice to the Pubco that it intends to effect an offering of all or part of the Registrable Securities included on such Registration Statement, the Pubco will use commercially reasonable efforts to amend or supplement such Registration Statement as may be necessary in order to enable such offering to take place in accordance with the terms of this Agreement.
2.1.3 Underwritten Offering. Subject to the provisions of subsection 2.1.4 and Sections 2.4 and 3.4 hereof, any Demanding Holder may make a written demand for an Underwritten Offering pursuant to a Registration Statement filed with the Commission in accordance with subsection 2.1.1 (an “Underwritten Demand”). The Pubco shall, within ten (10) days of the Pubco’s receipt of the Underwritten Demand, notify, in writing, all other Holders of such demand, and each Holder who thereafter requests to include all or a portion of such Holder’s Registrable Securities in such Underwritten Offering pursuant to such Underwritten Demand (each such Holder that requests to include all or a portion of such Holder’s Registrable Securities in such Underwritten Offering, a “Requesting Holder”) shall so notify the Pubco, in writing, within two (2) days (one (1) day if such offering is an overnight or bought Underwritten Offering) after the receipt by the Holder of the notice from the Pubco. Upon receipt by the Pubco of any such written notification from a Requesting Holder(s), such Requesting Holder(s) shall be entitled to have their Registrable Securities included in such Underwritten Offering pursuant to such Underwritten Demand. All such Holders proposing to distribute their Registrable Securities through such Underwritten Offering under this subsection 2.1.3 shall enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering by the Demanding Holders initiating such Underwritten Offering. Notwithstanding the foregoing, the Pubco is not obligated to effect more than an aggregate of three (3) Underwritten Offerings pursuant to this subsection 2.1.3 and is not obligated to effect an Underwritten Offering pursuant to this subsection 2.1.3 within ninety (90) days after the closing of an Underwritten Offering.
5
2.1.4 Reduction of Underwritten Offering. If the managing Underwriter or Underwriters in an Underwritten Offering pursuant to an Underwritten Demand, in good faith, advises the Pubco, the Demanding Holders, the Requesting Holders and other persons or entities holding PubCo Ordinary Shares or other equity securities of the Pubco that the Pubco is obligated to include pursuant to separate written contractual arrangements with such persons or entities (if any) in writing that the dollar amount or number of Registrable Securities or other equity securities of the Pubco requested to be included in such Underwritten Offering exceeds the maximum dollar amount or maximum number of equity securities of the Pubco that can be sold in the Underwritten Offering without adversely affecting the proposed offering price, the timing, the distribution method or the probability of success of such offering (such maximum dollar amount or maximum number of such securities, as applicable, the “Maximum Number of Securities”), then the Pubco shall include in such Underwritten Offering, as follows: (a) first, the Registrable Securities of the Demanding Holders and the Requesting Holders (pro rata based on the respective number of Registrable Securities that each Demanding Holder and Requesting Holder has requested be included in such Underwritten Offering and the aggregate number of Registrable Securities that all of the Demanding Holders and Requesting Holders have requested be included in such Underwritten Offering (such proportion is referred to herein as “Pro Rata”)) that can be sold without exceeding the Maximum Number of Securities; (b) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (a), PubCo Ordinary Shares or other equity securities of the Pubco that the Pubco desires to sell and that can be sold without exceeding the Maximum Number of Securities; and (c) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (a) and (b), PubCo Ordinary Shares or other equity securities of the Pubco held by other persons or entities that the Pubco is obligated to include pursuant to separate written contractual arrangements with such persons or entities and that can be sold without exceeding the Maximum Number of Securities.
2.1.5 Withdrawal. A majority in interest of the Demanding Holders initiating an Underwritten Offering shall have the right to withdraw its Registrable Securities included in an Underwritten Offering pursuant to subsection 2.1.3 for any or no reason whatsoever upon written notification to the Pubco and the Underwriter or Underwriters (if any) of its intention to so withdraw at any time up to five (5) days prior to the filing of the applicable “red herring” prospectus or prospectus supplement used for marketing such Underwritten Offering. Following the receipt of any withdrawal notice, the Pubco shall promptly forward such withdrawal notice to any other Demanding Holders (if any) and other Requesting Holders (if any). Following the receipt of such notice, the other Demanding Holders and Requesting Holders, provided they collectively qualify as Demanding Holders, may elect to continue with the Underwritten Offering and such election to continue shall count as a Underwritten Demand of the continuing Demanding Holders for purposes of subsection 2.1.3 and not of the withdrawing Demanding Holders. If the Underwritten Offering is not continued pursuant to this subsection 2.1.5, then the withdrawn Underwritten Offering shall count as an effected Underwritten Offering for purposes of subsection 2.1.3.
2.2 Piggyback Registration.
2.2.1 Piggyback Rights. Subject to the provisions of subsection 2.2.2 and Sections 2.4 and 3.4 hereof, if the Pubco proposes to consummate an Underwritten Offering for its own account or for the account of shareholders of the Pubco (other than pursuant to Section 2.1), then the Pubco shall give written notice of such proposed action to all of the Holders as soon as practicable, which notice shall (a) describe the amount and type of securities to be included, the intended method(s) of distribution and the name of the proposed managing Underwriter or Underwriters, if any, and (b) offer to all of the Holders the opportunity to include of such number of Registrable Securities as such Holders may request in writing within two (2) days (unless such offering is an overnight or bought Underwritten Offering, then one (1) day), in each case after receipt of such written notice (such Registration a “Piggyback Registration”). The Pubco shall, in good faith, cause such Registrable Securities to be included in such Piggyback Registration and shall use its reasonable best efforts to cause the managing Underwriter or Underwriters of a proposed Underwritten Offering to permit the Registrable Securities requested by the Holders pursuant to this subsection 2.2.1 to be included in a Piggyback Registration on the same terms and conditions as any similar securities of the Pubco included in such Piggyback Registration and to permit the resale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof. All such Holders proposing to include Registrable Securities in an Underwritten Offering under this subsection 2.2.1 shall enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering by the Pubco.
6
2.2.2 Reduction of Piggyback Registration. If the managing Underwriter or Underwriters in an Underwritten Offering that is to be a Piggyback Registration, in good faith, advises the Pubco and the Holders of Registrable Securities participating in the Piggyback Registration in writing that the dollar amount or number of shares or equity securities of the Pubco that the Pubco desires to sell, taken together with (a) the shares or equity securities of the Pubco, if any, as to which the Underwritten Offering has been demanded pursuant to separate written contractual arrangements with persons or entities other than the Holders of Registrable Securities hereunder, (b) the Registrable Securities as to which a Piggyback Registration has been requested pursuant to this Section 2.2 and (c) the shares or equity securities of the Pubco, if any, as to which inclusion in the Underwritten Offering has been requested pursuant to separate written contractual piggyback registration rights of other shareholders of the Pubco, exceeds the Maximum Number of Securities, then:
(i) If the Underwritten Offering is undertaken for the Pubco’s account, the Pubco shall include in any such Underwritten Offering (A) first, the PubCo Ordinary Shares or other equity securities of the Pubco that the Pubco desires to sell, which can be sold without exceeding the Maximum Number of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (A), the Registrable Securities of Holders requesting a Piggyback Registration pursuant to subsection 2.2.1, Pro Rata, which can be sold without exceeding the Maximum Number of Securities; and (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A) and (B), PubCo Ordinary Shares or other equity securities of the Pubco, if any, as to which inclusion in the Underwritten Offering has been requested pursuant to written contractual piggyback registration rights of other shareholders of the Pubco, which can be sold without exceeding the Maximum Number of Securities; or
(ii) If the Underwritten Offering is pursuant to separate written contractual arrangements with persons or entities other than the Holders of Registrable Securities hereunder, then the Pubco shall include in any such Underwritten Offering (A) first, PubCo Ordinary Shares or other equity securities of the Pubco, if any, of such requesting persons or entities, which can be sold without exceeding the Maximum Number of Securities; (B) two, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A), the Registrable Securities of Holders requesting a Piggyback Registration pursuant to subsection 2.2.1, Pro Rata, which can be sold without exceeding the Maximum Number of Securities; (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (A) and (B), PubCo Ordinary Shares or other equity securities of the Pubco that the Pubco desires to sell, which can be sold without exceeding the Maximum Number of Securities; and (D) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A), (B) and (C), PubCo Ordinary Shares or other equity securities of the Pubco for the account of other persons or entities that the Pubco is obligated to register pursuant to separate written contractual arrangements with such persons or entities, which can be sold without exceeding the Maximum Number of Securities.
2.2.3 Piggyback Registration Withdrawal. Any Holder shall have the right to withdraw from a Piggyback Registration for any or no reason whatsoever upon written notification to the Pubco and the Underwriter or Underwriters (if any) of his, her or its intention to withdraw from such Piggyback Registration prior to (a) in the case of an Underwritten Offering, the launch of the roadshow (or other formal marketing activities) by the Underwriter(s); and (b) otherwise, the effectiveness of the Registration Statement filed with the Commission with respect to such Piggyback Registration. PubCo (whether on its own good faith determination or as the result of a request for withdrawal by persons pursuant to separate written contractual obligations) may withdraw a Registration Statement filed with the Commission in connection with a Piggyback Registration at any time prior to the effectiveness of such Registration Statement. Notwithstanding anything to the contrary in this Agreement, the Pubco shall be responsible for the Registration Expenses incurred in connection with the Piggyback Registration prior to its withdrawal under this subsection 2.2.3.
2.2.4 Unlimited Piggyback Registration Rights. For purposes of clarity, any Registration or Underwritten Offering effected pursuant to this Section 2.2 shall not be counted as an Underwritten Offering pursuant to an Underwritten Demand effected under Section 2.1 hereof.
7
2.3 Block Trades; Other Coordinated Offerings.
2.3.1 Notwithstanding any other provision of this Article 2, but subject to Sections 2.4 and 3.4, at any time and from time to time when an effective Registration Statement is on file with the Commission, if a Demanding Holder wishes to engage in (a) an underwritten registered offering not involving a “roadshow,” an offer commonly known as a “block trade” (a “Block Trade”) or (b) an “at the market” or similar registered offering through a broker, sales agent or distribution agent, whether as agent or principal, (an “Other Coordinated Offering”), in each case, with a total offering price reasonably expected to exceed, in the aggregate, $25 million, then if such Demanding Holder requires any assistance from the Pubco pursuant to this Section 2.3, such Holder shall notify the Pubco promptly of the Block Trade or Other Coordinated Offering at least five (5) business days prior to the day such offering is to commence and the Pubco shall use its commercially reasonable efforts to facilitate such Block Trade or Other Coordinated Offering; provided that the Demanding Holders representing a majority of the Registrable Securities wishing to engage in the Block Trade or Other Coordinated Offering shall use commercially reasonable efforts to work with the Pubco and any Underwriters or brokers, sales agents or placement agents (each, a “Financial Counterparty”) prior to making such request in order to facilitate preparation of the registration statement, prospectus and other offering documentation related to the Block Trade or Other Coordinated Offering.
2.3.2 Prior to the filing of the applicable “red herring” prospectus or prospectus supplement used in connection with a Block Trade or Other Coordinated Offering, a majority-in interest of the Demanding Holders initiating such Block Trade or Other Coordinated Offering shall have the right to withdraw from such Block Trade or Other Coordinated Offering for any or no reason whatsoever upon written notification to the Pubco, the Underwriter or Underwriters (if any) and Financial Counterparty (if any) of their intention to withdraw from such Block Trade or Other Coordinated Offering. Notwithstanding anything to the contrary in this Agreement, the Pubco shall be responsible for the Registration Expenses incurred in connection with a Block Trade or Other Coordinated Offering prior to its withdrawal under this subsection 2.3.2.
2.3.3 Notwithstanding anything to the contrary in this Agreement, Section 2.2 shall not apply to a Block Trade or Other Coordinated Offering initiated by a Demanding Holder pursuant to Section 2.3 of this Agreement.
2.3.4 The Demanding Holder in a Block Trade or Other Coordinated Offering shall have the right to select the Underwriters and Financial Counterparty (if any) for such Block Trade or Other Coordinated Offering (in each case, which shall consist of one or more reputable nationally recognized investment banks).
2.3.5 A Demanding Holder in the aggregate may demand no more than two (2) Block Trades or Other Coordinated Offerings pursuant to this Section 2.3 in any twelve (12) month period. For the avoidance of doubt, any Block Trade or Other Coordinated Offering effected pursuant to this Section 2.3 shall not be counted as a demand for an Underwritten Offering pursuant to subsection hereof.
2.4 Restrictions on Registration Rights. If (a) during the period starting with the date thirty (30) days prior to the Pubco’s good faith estimate of the date of the filing of, and ending on a date one hundred and twenty (120) days after the effective date of, a Pubco-initiated Registration and provided that the Pubco continues to actively employ, in good faith, all reasonable efforts to cause the applicable Registration Statement to become effective; (b) the Holders have requested an Underwritten Offering pursuant to an Underwritten Demand and the Pubco and the Holders are unable to obtain the commitment of underwriters to firmly underwrite the offer; or (c) the Holders have requested an Underwritten Offering pursuant to an Underwritten Demand and in the good faith judgment of the Board such Underwritten Offering would be seriously detrimental to the Pubco and the Board concludes as a result that it is essential to defer the undertaking of such Underwritten Offering at such time, then in each case the Pubco shall have the right, upon giving prompt written notice of such action to the affected Holders (which notice shall specify the nature of the event giving rise to such delay or suspension), delay the filing or initial effectiveness of, or suspend use of, such Registration Statement for the shortest period of time determined in good faith by the Pubco to be necessary for such purpose; provided, however, that the Pubco shall not defer its obligation in this manner more than once in any twelve (12)-month period.
8
2.5 Market Stand-off. In connection with any Underwritten Offering of equity securities of the Pubco (other than a Block Trade or Other Coordinated Offering), if reasonably requested by the Underwriter(s), each Holder that is (a) an executive officer, (b) a director or (c) Holder in excess of five percent (5%) of the outstanding PubCo Ordinary Shares (and for which it is customary for such a Holder to agree to a lock-up) agrees that it shall not Transfer any shares of PubCo Ordinary Shares or other equity securities of the Pubco (other than those included in such offering pursuant to this Agreement), without the prior written consent of the Pubco, during the ninety (90)-day period (or such shorter time agreed to by the managing Underwriters) beginning on the date of pricing of such offering, except as expressly permitted by such lock-up agreement or in the event the Underwriter(s) otherwise agree by written consent. Each such Holder agrees to execute a customary lock-up agreement in favor of the Underwriters to such effect (in each case on substantially the same terms and conditions as all such Holders).
Article 3
PUBCO PROCEDURES
3.1 General Procedures. The Pubco shall use its reasonable best efforts to effect such Registration or Underwritten Offering to permit the resale or other disposition of such Registrable Securities in accordance with the intended plan of distribution thereof, and pursuant thereto the Pubco shall, as expeditiously as possible and to the extent applicable:
3.1.1 prepare and file with the Commission after the consummation of the Business Combination a Registration Statement with respect to such Registrable Securities and use commercially reasonable efforts to cause such Registration Statement to become effective in accordance with Section 2.1 hereof and remain effective, including filing a replacement Registration Statement, if necessary, until all Registrable Securities covered by such Registration Statement have been sold or are no longer outstanding (such period, the “Effectiveness Period”);
3.1.2 prepare and file with the Commission such amendments and post-effective amendments to the Registration Statement, and such supplements to the Prospectus, as may be reasonably requested by the Holders or any Underwriter or as may be required by the rules, regulations or instructions applicable to the registration form used by the Pubco or by the Securities Act or rules and regulations thereunder to keep the Registration Statement effective until all Registrable Securities covered by such Registration Statement are sold in accordance with the intended plan of distribution set forth in such Registration Statement or supplement to the Prospectus or are no longer outstanding;
3.1.3 prior to filing a Registration Statement or Prospectus, or any amendment or supplement thereto, furnish without charge to the Underwriters or Financial Counterparty, if any, and the Holders of Registrable Securities included in such Registration or Underwritten Offering or Block Trade, and such Holders’ legal counsel, copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto and documents incorporated by reference therein), the Prospectus (including each preliminary Prospectus) and such other documents as the Underwriters and the Holders of Registrable Securities included in such Registration or Underwritten Offering or the legal counsel for any such Holders may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Holders; provided, that the Pubco will not have any obligation to provide any document pursuant to this clause that is available on the Commission’s EDGAR system;
3.1.4 prior to any Underwritten Offering of Registrable Securities, use commercially reasonable efforts to (a) register or qualify the Registrable Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the Holders of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request and (b) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved by such other governmental authorities as may be necessary by virtue of the business and operations of the Pubco and do any and all other acts and things that may be necessary or advisable to enable the Holders of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Pubco shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify or take any action to which it would be subject to general service of process or taxation in any such jurisdiction where it is not then otherwise so subject;
9
3.1.5 cause all such Registrable Securities to be listed on each securities exchange or automated quotation system on which similar securities issued by the Pubco are then listed;
3.1.6 provide a transfer agent or warrant agent, as applicable, and registrar for all such Registrable Securities no later than the effective date of such Registration Statement or Underwritten Offering;
3.1.7 advise each seller of such Registrable Securities, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the Commission suspending the effectiveness of such Registration Statement or the initiation or threatening of any proceeding for such purpose and promptly use its reasonable best efforts to prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued;
3.1.8 during the Effectiveness Period, furnish a conformed copy of each filing of any Registration Statement or Prospectus or any amendment or supplement to such Registration Statement or Prospectus or any document that is to be incorporated by reference into such Registration Statement or Prospectus, promptly after such filing of such documents with the Commission to each seller of such Registrable Securities or its counsel; provided, that the Pubco will not have any obligation to provide any document pursuant to this clause that is available on the Commission’s EDGAR system;
3.1.9 notify the Holders at any time when a Prospectus relating to such Registration Statement is required to be delivered under the Securities Act;
3.1.10 subject to the provisions of this Agreement, notify the Holders of the happening of any event as a result of which a Misstatement exists, and then to correct such Misstatement as set forth in Section 3.4 hereof;
3.1.11 in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering, or sale by a Financial Counterparty pursuant to such Registration, permit a representative of the Holders, the Underwriters or other Financial Counterparty facilitating such Underwritten Offering, Block Trade, Other Coordinated Offering or other sale pursuant to such Registration, if any, and any attorney or accountant retained by such Holders or Underwriter to participate, at each such person’s own expense, in the preparation of the Registration Statement or the Prospectus, and cause the Pubco’s officers, directors and employees to supply all information reasonably requested by any such representative, Underwriter, Financial Counterparty, attorney or accountant in connection with the Registration; provided, however, that such representatives or Underwriters or Financial Counterparty enter into confidentiality agreements, in form and substance reasonably satisfactory to the Pubco, prior to the release or disclosure of any such information;
3.1.12 obtain a comfort letter from the Pubco’s independent registered public accountants in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering, or sale by a Financial Counterparty pursuant to such Registration (subject to such Financial Counterparty providing such certification or representation reasonably requested by the Pubco’s independent registered public accountants and the Pubco’s counsel), in customary form and covering such matters of the type customarily covered by comfort letters as the managing Underwriter may reasonably request, and reasonably satisfactory to a majority-in-interest of the participating Holders;
3.1.13 in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering, or sale by a Financial Counterparty pursuant to such Registration, on the date the Registrable Securities are delivered for sale pursuant to such Registration, obtain an opinion, dated such date, of counsel representing the Pubco for the purposes of such Registration, addressed to the participating Holders or the Financial Counterparty, if any, and the Underwriters, if any, covering such legal matters with respect to the Registration in respect of which such opinion is being given as the participating Holders, Financial Counterparty or Underwriter may reasonably request and as are customarily included in such opinions and negative assurance letters, and reasonably satisfactory to such participating Holders, Financial Counterparty or Underwriter;
10
3.1.14 in the event of an Underwritten Offering or a Block Trade, or an Other Coordinated Offering or sale by a Financial Counterparty pursuant to such Registration to which the Pubco has consented, to the extent reasonably requested by such Financial Counterparty in order to engage in such offering, allow the Underwriters or Financial Counterparty to conduct customary “underwriter’s due diligence” with respect to the Pubco;
3.1.15 in the event of any Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a Financial Counterparty pursuant to such Registration, enter into and perform its obligations under an underwriting agreement or other purchase or sales agreement, in usual and customary form, with the managing Underwriter or the Financial Counterparty of such offering or sale;
3.1.16 make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve (12) months beginning with the first (1st) day of the Pubco’s first full calendar quarter after the effective date of the Registration Statement which satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any successor rule promulgated thereafter by the Commission);
3.1.17 use its reasonable efforts to make available senior executives of the Pubco to participate in customary “road show” presentations that may be reasonably requested by the Underwriter in any Underwritten Offering; and
3.1.18 otherwise, in good faith, cooperate reasonably with, and take such customary actions as may reasonably be requested by the Holders, in connection with such Registration.
Notwithstanding the foregoing, the Pubco shall not be required to provide any documents or information to an Underwriter or Financial Counterparty if such Underwriter of Financial Counterparty has not then been named with respect to the applicable Underwritten Offering or other offering involving a registration as an Underwriter or Financial Counterparty, as applicable.
3.2 Registration Expenses. The Registration Expenses in respect of all Registrations shall be borne by the Pubco. It is acknowledged by the Holders that the Holders shall bear all incremental selling expenses relating to the sale of Registrable Securities, such as Underwriters’ commissions and discounts, brokerage fees, Underwriter marketing costs and, other than as set forth in the definition of “Registration Expenses,” all reasonable fees and expenses of any legal counsel representing the Holders.
3.3 Requirements for Participation in Underwritten Offerings. In connection with any Registration Statement in which a Holder of Registrable Securities is participating, such Holder shall furnish (or cause to be furnished) to the Pubco in writing such information and affidavits as the Pubco reasonably requests for use in connection with any such Registration Statement or Prospectus (the “Holder Information”). Notwithstanding anything in this Agreement to the contrary, if any Holder does not provide the Pubco with its requested Holder Information, the Pubco may exclude such Holder’s Registrable Securities from the applicable Registration Statement or Prospectus if the Pubco determines, based on the advice of counsel, that it is necessary or advisable to include such information in the applicable Registration Statement or Prospectus and such Holder continues thereafter to withhold such information. No person or entity may participate in any Underwritten Offering for equity securities of the Pubco pursuant to a Registration initiated by the Pubco hereunder unless such person or entity (a) agrees to sell such person’s or entity’s securities on the basis provided in any underwriting arrangements approved by the Pubco and (b) completes and executes all customary questionnaires, powers of attorney, indemnities, lock-up agreements, underwriting agreements and other customary documents as may be reasonably required under the terms of such underwriting arrangements.
11
3.4 Adverse Disclosure; Suspension of Sales. Notwithstanding anything to the contrary in this Agreement, If the filing, initial effectiveness or continued use of a Registration Statement in respect of any Registration at any time would require the Pubco to make an Adverse Disclosure or would require the inclusion in such Registration Statement of financial statements that are unavailable to the Pubco for reasons beyond the Pubco’s control, the Pubco may, upon giving prompt written notice of such action to the Holders, delay the filing or initial effectiveness of, or suspend use of, such Registration Statement on not more than two (2) occasions for not more than sixty (60) consecutive calendar days on each occasion or not more than ninety (90) total calendars days, in each case, during twelve (12)-month period, determined in good faith by the Board to be necessary for such purpose. In the event the Pubco exercises its rights under the preceding sentence, the Holders agree to suspend, immediately upon their receipt of the notice referred to above, their use of the Prospectus relating to any Registration in connection with any sale or offer to sell Registrable Securities until such Holder receives written notice from the Pubco. The Pubco shall promptly notify the Holders of the expiration of any period during which the Pubco exercised its rights under this Section 3.4. The Holders shall maintain the confidentiality of such notice and its contents. Upon receipt of written notice from the Pubco that a Registration Statement or Prospectus contains a Misstatement, or in the opinion of counsel for the Pubco it is necessary to supplement or amend such Prospectus to comply with law, each of the Holders shall forthwith discontinue disposition of Registrable Securities until it has received copies of a supplemented or amended Prospectus correcting the Misstatement or including the information counsel for the Pubco believes to be necessary to comply with law (it being understood that the Pubco hereby covenants to prepare and file such supplement or amendment as soon as practicable after the time of such notice such that the Registration Statement or Prospectus, as so amended or supplemented, as applicable, will not include a Misstatement and complies with law), or until it is advised in writing by the Pubco that the use of the Prospectus may be resumed.
3.5 Reporting Obligations. As long as any Holder shall own Registrable Securities, the Pubco, at all times while it shall be a reporting company under the Exchange Act, covenants to file timely (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Pubco after the date hereof pursuant to Section 13(a) or 15(d) of the Exchange Act. The Pubco further covenants that it shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to resell or otherwise dispose of Registrable Securities held by such Holder without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act (or any successor rule promulgated thereafter by the Commission), including providing any legal opinions. Upon the request of any Holder, the Pubco shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements.
3.6 Limitation on Registration Rights. Notwithstanding anything herein to the contrary, (i) the Representative may not exercise its rights under Sections 2.1 and 2.2 hereunder after five (5) and seven (7) years, respectively, from the effective date of the Acquiror’s registration statement on Form S-1, and (ii) the Representative may not exercise its rights under Section 2.1 more than one time.
Article 4
INDEMNIFICATION AND CONTRIBUTION
4.1 Indemnification.
4.1.1 The Pubco agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers, directors, employees, advisors, agents, representatives, members and each person who controls such Holder (within the meaning of the Securities Act) (collectively, the “Holder Indemnified Persons”) against all losses, claims, damages, liabilities and expenses (including reasonable attorneys’ fees and inclusive of all reasonable attorneys’ fees arising out of the enforcement of each such persons’ rights under this Section 4.1) resulting from any Misstatement, except insofar as the same are caused by or contained or included in any information furnished in writing to the Pubco by or on behalf of such Holder Indemnified Person specifically for use therein.
12
4.1.2 In connection with any Registration Statement in which a Holder of Registrable Securities is participating, such Holder shall furnish to the Pubco in writing such information and affidavits as the Pubco reasonably requests for use in connection with any such Registration Statement or Prospectus and, to the extent permitted by law, shall, severally and not jointly, indemnify the Pubco, its officers, directors, employees, advisors, agents, representatives and each person who controls the Pubco (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses (including reasonable attorneys’ fees and inclusive of all reasonable attorneys’ fees arising out of the enforcement of each such persons’ rights under this Section 4.1) resulting from any Misstatement, but only to the extent that the same are made in reliance on and in conformity with information relating to the Holder so furnished in writing to the Pubco by or on behalf of such Holder specifically for use therein; provided, however, that the obligation to indemnify shall be several, not joint and several, among such Holders of Registrable Securities, and the liability of each such Holder of Registrable Securities shall be in proportion to and limited to the net proceeds received by such Holder from the sale of Registrable Securities pursuant to such Registration Statement.
4.1.3 Any person entitled to indemnification herein shall (a) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s right to indemnification hereunder to the extent such failure has not materially prejudiced the indemnifying party) and (b) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim or there may be reasonable defenses available to the indemnified party that are different from or additional to those available to the indemnifying party, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent shall not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim. No indemnifying party shall, without the consent of the indemnified party, consent to the entry of any judgment or enter into any settlement which cannot be settled in all respects by the payment of money (and such money is so paid by the indemnifying party pursuant to the terms of such settlement) or which settlement does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.
4.1.4 The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director, employee, advisor, agent, representative, member or controlling person of such indemnified party and shall survive the transfer of securities.
4.1.5 If the indemnification provided under this Section 4.1 is held by a court of competent jurisdiction to be unavailable to an indemnified party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, shall to the extent permitted by law contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified party shall be determined by a court of law by reference to, among other things, whether the Misstatement relates to information supplied by such indemnifying party or such indemnified party and the indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action; provided, however, that the liability of any Holder under this subsection 4.1.5 shall be limited to the amount of the net proceeds received by such Holder in such offering giving rise to such liability. The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be deemed to include, subject to the limitations set forth in subsections 4.1.1, 4.1.2 and above, any legal or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this subsection 4.1.5 were determined by pro rata allocation or by any other method of allocation, which does not take account of the equitable considerations referred to in this subsection 4.1.5. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this subsection 4.1.5 from any person who was not guilty of such fraudulent misrepresentation.
13
Article 5
MISCELLANEOUS
5.1 Notices. Any notice or communication under this Agreement must be in writing and given by (a) deposit in the United States mail, addressed to the party to be notified, postage prepaid and registered or certified with return receipt requested, (b) delivery in person or by courier service or sent by overnight mail via a reputable overnight carrier, in each case providing evidence of delivery or (c) transmission by facsimile or email. Each notice or communication that is mailed, delivered or transmitted in the manner described above shall be deemed sufficiently given, served, sent, and received, in the case of mailed notices, on the third (3rd) business day following the date on which it is mailed, in the case of notices delivered by courier service, hand delivery or overnight mail, at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger) or at such time as delivery is refused by the addressee upon presentation, and in the case of notices delivered by facsimile or email, at such time as it is successfully transmitted to the addressee. Any notice or communication under this Agreement must be addressed, if to the Pubco, to: [To insert Pubco’s address], and, if to any other Holder, to the address of such Holder as it appears in the applicable register for the Registrable Securities or such other address as may be designated in writing by such Holder (including on the signature pages hereto). Any party may change its address for notice at any time and from time to time by written notice to the other parties hereto, and such change of address shall become effective thirty (30) days after delivery of such notice as provided in this Section 5.1.
5.2 Assignment; No Third Party Beneficiaries.
5.2.1 This Agreement and the rights, duties and obligations of the Pubco hereunder may not be assigned or delegated by the Pubco in whole or in part.
5.2.2 Any Holder may assign or delegate such Holder’s rights, duties or obligations under this Agreement, in whole or in part, to any transferee of Registrable Securities; provided, however, for any Holder party to the Lock-up Agreement, prior to the expiration of the Lock-Up Period, such Holder may not assign or delegate such Holder’s rights, duties or obligations under this Agreement, in whole or in part, except in connection with a transfer of Registrable Securities by such Holder to a Permitted Transferee (as defined in the Lock-up Agreement) but only if such Permitted Transferee agrees to become bound by the transfer restrictions set forth in this Agreement.
5.2.3 This Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and its successors and the permitted assigns of the Holders, which shall include Permitted Transferees.
5.2.4 This Agreement shall not confer any rights or benefits on any persons that are not parties hereto, other than as expressly set forth in this Agreement and this Section 5.2.
5.2.5 No assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate the Pubco unless and until the Pubco shall have received (a) written notice of such assignment as provided in Section 5.1 hereof and (b) the written agreement of the assignee, in a form reasonably satisfactory to the Pubco, to be bound by the terms and provisions of this Agreement (which may be accomplished by an addendum or certificate of joinder to this Agreement). Any transfer or assignment made other than as provided in this Section 5.2 shall be null and void.
5.3 Counterparts. This Agreement may be executed in multiple counterparts (including facsimile or PDF counterparts), each of which shall be deemed an original, and all of which together shall constitute the same instrument, but only one of which need be produced.
14
5.4 Governing Law; Venue. NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK AS APPLIED TO AGREEMENTS AMONG NEW YORK RESIDENTS ENTERED INTO AND TO BE PERFORMED ENTIRELY WITHIN NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS OF SUCH JURISDICTION
5.5 Amendments and Modifications. Upon the written consent of (i) the Pubco, (ii) the Holders of at least a majority-in-interest of the Registrable Securities at the time in question (which majority must include the Representative if such amendment or modification is material and adverse to the Representative), (iii) so long as Noble Elite holds any Registrable Securities, Noble Elite (which consent shall not be unreasonably withheld, conditioned or delayed), and (iv) so long as Binance holds any Registrable Securities, Binance (which consent shall not be unreasonably withheld, conditioned or delayed), compliance with any of the provisions, covenants and conditions set forth in this Agreement may be waived, or any of such provisions, covenants or conditions may be amended or modified; provided, however, that notwithstanding the foregoing, any amendment hereto or waiver hereof that adversely affects any Holder, solely in his, her or its capacity as a holder of the shares of the Pubco, in a manner that is materially different from the other Holders (in such capacity) shall require the consent of each such Holder so affected. No course of dealing between any Holder or the Pubco and any other party hereto or any failure or delay on the part of a Holder or the Pubco in exercising any rights or remedies under this Agreement shall operate as a waiver of any rights or remedies of any Holder or the Pubco. No single or partial exercise of any rights or remedies under this Agreement by a party shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder or thereunder by such party.
5.6 Prior Agreement. The Acquiror, the Sponsor, and the Representative, by executing this Agreement, hereby agree and consent to amend and restate the Prior Agreement, and replace the Prior Agreement in its entirety by this Agreement.
5.7 Holder Information. Each Holder agrees, if requested in writing, to represent to the Pubco the total number of Registerable Securities held by such Holder in order for the Pubco to make determinations hereunder.
5.8 Other Registration Rights. The Pubco represents and warrants that as of the date hereof no person, other than a Holder of Registrable Securities, has any right to require the Pubco to register any securities of the Pubco for sale or to include such securities of the Pubco in any Registration filed by the Pubco for the sale of securities for its own account or for the account of any other person. Further, the Pubco represents and warrants that this Agreement supersedes any other registration rights agreement or agreement with similar terms and conditions and in the event of a conflict between any such agreement or agreements and this Agreement, the terms of this Agreement shall prevail.
5.9 Term. This Agreement shall terminate upon the earlier of (a) the tenth (10th) anniversary of the date of this Agreement and (b) the date as of which the Holders cease to hold any Registrable Securities. The provisions of Article 4 shall survive any termination.
[Signature Page Follows]
15
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
| Pubco: | ||
| [PUBCO] | ||
| By: | ||
| Name: | ||
| Title: | ||
[Signature Page to A&R Registration Rights Agreement]
16
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
| HOLDERS: | ||
| CSLM ACQUISITION SPONSOR II, LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
[Signature Page to A&R Registration Rights Agreement]
17
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
| HOLDERS: | ||
| COHEN & COMPANY CAPITAL MARKETS, | ||
| A DIVISION OF COHEN & COMPANY SECURITIES, LLC | ||
| By: | ||
| Name: | ||
| Title: | ||
[Signature Page to A&R Registration Rights Agreement]
18
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
| HOLDERS: | ||
| [●] | ||
| [NTD: To the shareholders of the Company who are subject to lock-up and who are otherwise restricted from selling shares, the Binance Warrantholder, and Noble Elite] | ||
| By: | ||
| Name: | ||
| Title: | ||
[Signature Page to A&R Registration Rights Agreement]
19
Exhibit 10.5
FORM OF LOCK-UP AGREEMENT
This Lock-Up Agreement (this “Agreement”) is dated as of [●], 2026, by and among [PUBCO], a Cayman Islands exempted company limited by shares (“PubCo”) and the shareholder of PubCo listed on the signature pages hereto (the “Shareholder”). Capitalized terms used but not defined herein shall have the respective meanings ascribed to such terms in the Business Combination Agreement (as defined below).
RECITALS
WHEREAS, the Shareholder owns certain equity interests in PubCo pursuant to the terms of the Business Combination Agreement.
WHEREAS, on the date hereof, PubCo consummated the transactions contemplated by that certain Business Combination Agreement, dated as of October 6, 2026 (as amended, the “Business Combination Agreement”), entered into by and among PubCo, First Digital Group Ltd., a Gibraltar private company limited by shares (the “Company”), CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares (the “Acquiror”), and Merger Sub, pursuant to which, upon the terms and subject to the conditions set forth therein: (a) at least one (1) Business Day prior to the Reincorporation Merger, the Company will (i) re-domicile from Gibraltar to the Cayman Islands, and (ii) transfer by way of continuation as an exempted company limited by shares in the Cayman Islands in accordance with the Gibraltar Companies Act and the Cayman Companies Act (as applicable) (the “Re-domiciliation and Continuation”), (b) at least one (1) Business Day after the consummation of the Re-domiciliation and Continuation, Acquiror will merge with and into PubCo (the “Reincorporation Merger”), with PubCo being the surviving entity and Merger Sub becoming a wholly-owned subsidiary of PubCo, and (c) at least one (1) Business Day after the completion of both the Reincorporation Merger and the Re-domiciliation and Continuation and within three (3) Business Days after the completion of the Reincorporation Merger, Merger Sub will merge with and into the Company (the “Acquisition Merger” and, together with the Reincorporation Merger, the “Mergers”), with the Company being the surviving entity and becoming a wholly-owned Subsidiary of PubCo and the outstanding securities of the Company immediately prior to the Acquisition Merger Effective Time being converted into securities of PubCo (the Mergers together with the other transactions contemplated by the Business Combination Agreement, the “Transactions”).
WHEREAS, in connection with the Transactions, the parties hereto wish to set forth herein certain understandings between such parties with respect to restrictions on the transfer of certain equity interests in PubCo acquired by the Shareholder pursuant to the terms of the Business Combination Agreement.
NOW, THEREFORE, the parties agree as follows:
1. Subject to the exceptions set forth herein, the Shareholder agrees not to, without the prior written consent of the board of directors of PubCo, (i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, the PubCo Ordinary Shares (the “PubCo Shares”) or any rights, options, warrants or other securities convertible into or exercisable or exchangeable for any PubCo Shares (the “PubCo Share Convertible Securities”), in each case held by it immediately after the Acquisition Merger Effective Time, as well as any PubCo Shares issuable upon the exercise of any such PubCo Share Convertible Securities (collectively, the “Subject Securities”), (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of such Subject Securities, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii) (the actions specified in clauses (i)-(iii), collectively, “Transfer”) for the period (the “Lock-Up Period”) commencing on the Acquisition Merger Effective Time and until
the earlier of (i) the date that is one hundred and eighty (180) days after the Acquisition Merger Effective Time, or (ii) the date on which PubCo completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of PubCo’s shareholders having the right to exchange their PubCo Shares or other equity securities of PubCo for cash, securities or other property. Notwithstanding the foregoing, after at least 120 days after the Acquisition Merger Effective Time, (a) twenty-five percent (25%) of the Subject Securities shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $12.00 for 20 consecutive trading days, (b) up to fifty percent (50%) of the Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $14.00 for 20 consecutive trading days, (c) up to seventy-five percent (75%) of the Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $16.00 for 20 consecutive trading days, and (d) all Subject Securities (including any Subject Securities that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the PubCo Class A Ordinary Shares equals or exceeds $18.00 for 20 consecutive trading days.
Without limiting the generality of Section 1, during the Lock-Up Period, the Shareholder shall not, directly or indirectly, (a) pledge, hypothecate, or grant any security interest in any Subject Securities to any person (including in connection with any margin loan or similar financing arrangement), (b) enter into any prepaid variable forward contract, equity swap, collar, or other derivative transaction with respect to any Subject Securities, or (c) write or purchase any put or call option or enter into any other hedging or monetization transaction with respect to any Subject Securities. Any violation of this paragraph shall be deemed a Transfer in violation of Section 1.
2. The restrictions set forth in Section 1 shall not apply to:
| (i) | if the Shareholder is not an individual, in the case of an entity, Transfers to a shareholder, partner, member, or owner of a similar equity interest in, or direct or indirect affiliate (within the meaning set forth in Rule 405 under Securities Act) of the Shareholder, or an investment fund or any other entity controlling, controlled by, managing, or managed by or under common control with the Shareholder or affiliates of the Shareholder (including, for the avoidance of doubt, where the Shareholder is a partnership, to its general partner or a successor partnership or fund, or any other funds managed by such partnership); |
| (ii) | if the Shareholder is an individual, Transfers by gift to members of the individual’s immediate family (as defined below) or to a trust, the beneficiary of which is the Shareholder or a member of the Shareholder’s immediate family, or to a charitable organization; |
| (iii) | if the Shareholder is an individual, Transfers by virtue of laws of descent and distribution upon death of the individual; |
| (iv) | if the Shareholder is an individual, Transfers pursuant to a qualified domestic relations order; |
| (v) | if the Shareholder is an entity, Transfers by virtue of the laws of the jurisdiction of the entity’s organization and the entity’s organizational documents upon dissolution of the entity; |
| (vi) | Transfers pursuant to transactions relating to the PubCo Shares or other securities convertible into or exercisable or exchangeable for the PubCo Shares acquired by the Shareholder pursuant to any public offering or in open market transactions after the Acquisition Merger Effective Time; |
| (vii) | Transfers to PubCo pursuant to any contractual arrangement in effect at the Acquisition Merger Effective Time that provides for the repurchase by Acquiror or the Company or forfeiture of the Shareholder’s shares in Acquiror or the Company or other securities convertible into or exercisable or exchangeable for shares in Acquiror or the Company in connection with the termination of the Shareholder’s service to Acquiror or the Company; |
2
| (viii) | Transfers pursuant to transactions in the event of completion of a liquidation, merger, stock exchange, bona fide third-party tender offer for securities of the Company or other similar transactions which results in all of PubCo’s shareholders having the right to exchange their PubCo Shares for cash, securities or other property; |
| (ix) | Transfers pursuant to transactions to satisfy any U.S. federal, state, or local income tax obligations of the Shareholder (or its direct or indirect owners) arising from a change in the U.S. Internal Revenue Code of 1986, as amended (the “Code”), or the U.S. Treasury Regulations promulgated thereunder (the “Regulations”) after the date on which the Business Combination Agreement was executed by the parties thereto, and such change prevents the Transactions from qualifying for the Intended Tax Treatment (and the Transactions do not qualify for similar tax-free treatment pursuant to any successor or other provision of the Code or Regulations taking into account such changes); |
| (x) | create any security interest or encumbrance over any Subject Securities pursuant to a margin account or in connection with a bona fide debt financing made to the undersigned by banks or other financial institutions, provided that no enforcement of, or foreclosure with respect to such Subject Securities shall take place during the Lock-Up Period; and |
| (xi) | [Transfers of PubCo Shares by the Shareholder to holders of FDG Tokens upon the exercise of such FDG Tokens pursuant to the applicable terms and conditions]. [NTD: To include only in the lock-up agreement for Nemi] |
| (xii) | [forfeiture and surrender of PubCo Shares by the Shareholder as contemplated by [Section 8.11] and [Section 9.13] of the Business Combination Agreement]. [NTD: To include only in the lock-up agreement for the Sponsor] |
| (xiii) | [Transfer of any Founder Transaction Bonus Shares by the Company Founder.] [NTD: To include only in the lock-up agreement for the Company Founder] |
provided, however, that in the case of clauses (i) through (v), these permitted transferees must enter into a written agreement, in substantially the form of this Agreement (it being understood that any references to “immediate family” in the agreement executed by such transferee shall expressly refer only to the immediate family of the Shareholder and not to the immediate family of the transferee), agreeing to be bound by these Transfer restrictions. For purposes of this Section 2, “immediate family” shall mean a spouse, domestic partner, child, grandchild or other lineal descendant (including by adoption), father, mother, brother or sister of the Shareholder; and “affiliate” shall have the meaning set forth in Rule 405 under the Securities Act of 1933, as amended. The Shareholder shall provide prior written notice to PubCo and the Acquiror of any Transfer made pursuant to the foregoing exceptions at least five (5) Business Days prior to such Transfer, and any Transfer in violation of this Agreement shall be void and of no effect.
3. The Shareholder hereby represents and warrants that such Shareholder has full power and authority to enter into this Agreement and that this Agreement constitutes the legal, valid and binding obligation of the Shareholder, enforceable in accordance with its terms. Upon request, the Shareholder will execute any additional documents necessary in connection with enforcement hereof, provided that the terms of any such additional document shall not impose any additional restrictions or obligations on the Shareholder. Any obligations of the Shareholder shall be binding upon the successors and assigns of the Shareholder from and after the date hereof. The Shareholder further represents and warrants that, when the Subject Securities are issued to the Shareholder, the Shareholder will have, and, except as contemplated by Sections 1 and 2 above, will retain for the duration of the Lock-Up Period good and marketable title to its Subject Securities, free and clear of all liens, encumbrances, and claims whatsoever (other than arising or as expressly permitted under this Agreement or under applicable securities laws)
3
4. This Agreement constitutes the entire agreement and understanding of the parties in respect of the subject matter hereof and supersedes all prior understandings, agreements or representations by or among the parties, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions contemplated hereby. This Agreement may not be changed, amended, modified or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed by all of the parties (including, for the avoidance of doubt, PubCo); and no waiver of, or consent to departure from, any provision of this Agreement shall be effective unless in writing and signed by PubCo and the Shareholder.
5. No party may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written consent of the other parties. Any purported assignment in violation of this Section shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee. This Agreement shall be binding on the Shareholder and each of its respective successors, heirs and assigns and permitted transferees.
6. The Shareholder hereby authorizes PubCo to cause its transfer agent to decline to transfer, and to note stop-transfer restrictions on the stock register and other records relating to, the Subject Securities for which the Shareholder is the record holder, and, in the case of Subject Securities for which the Shareholder is the beneficial but not the record holder, the Shareholder agrees to cause the record holder of such Subject Securities to cause the transfer agent to decline to transfer, and to note stop-transfer restrictions on the stock register and other records relating to, such Subject Securities, in each case to the extent consistent with and for the period of the restrictions on transfer contemplated by this Agreement. PubCo shall cause each certificate (or book-entry position) representing any Subject Securities to be stamped or otherwise imprinted with a legend in substantially the following form: “THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A LOCK-UP AGREEMENT THAT RESTRICTS THE TRANSFER OF SUCH SECURITIES. A COPY OF SUCH AGREEMENT MAY BE OBTAINED FROM THE SECRETARY OF THE ISSUER.”
7. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. Section 12.16(a) of the Business Combination Agreement (Jurisdiction) shall apply mutatis mutandis hereunder.
8. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY HERETO IN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.
9. The parties hereto agree that irreparable damage would occur in the event any provision of this Agreement were not performed in accordance with the terms hereof, and that the parties shall be entitled to specific performance of the terms hereof in addition to any other remedy at law or in equity, including injunctive relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, in each case without the necessity of proving actual damages or posting any bond or other security.
10. This Agreement shall terminate upon expiration of the Lock-Up Period.
11. This Agreement may be executed and delivered (including by facsimile or portable document format (.pdf) transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery by email to counsel for the other parties of a counterpart executed by a party shall be deemed to meet the requirements of the previous sentence.
4
12. [In the event that a release is granted to the Sponsor, the Company Founder or any Major Holder (as defined below) relating to the lock-up restrictions set forth above, the same percentage of the Shareholder’s Subject Securities (the “Pro-rata Release”) shall be immediately and fully released on the same terms from any remaining lock-up restrictions set forth herein. In the event that the Shareholder is released from any of its obligations under this Agreement or, by virtue of this Agreement, becomes entitled to offer, pledge, sell, contract to sell, or otherwise dispose of any of the Shareholder’s Subject Securities prior to the termination of the Lock-Up Period, the PubCo shall use their commercially reasonably efforts to provide notification of such to the undersigned within three business days thereof. For purposes of this Agreement, a “Major Holder” shall mean each record or beneficial owner, as of immediately prior to the Acquisition Merger Effective Time, of more than five percent (5%) of the issued and outstanding share capital of the Company. For purposes of determining record or beneficial ownership of a shareholder, all securities held by investment funds affiliated with such shareholder shall be aggregated.] [NTD: To include only in the lock-up agreement of Noble Elite]
13. [The effectiveness and validity of this Agreement is subject to the continuing satisfaction of the condition that each and all of the Sponsor, the Company Founder and the Major Holder has entered into a legally binding lock-up agreement and/or undertaking with respect to the equity securities of the PubCo held by each such party which contains at least the same length of lock-up period and other restrictions substantially identical to or at least as restrictive as those under this Agreement and without any right, interest, benefit or privilege granted to any other party more favorable than the terms and conditions under this Agreement. Save as waived by the Shareholder, if the Sponsor, the Company Founder or any Major Holder (other than the Shareholder) is entitled to any rights, preferences or privileges with respect to the matters set out herein that are more favorable than those granted to the Shareholder, the PubCo shall immediately notify the Shareholder in writing, and the Shareholder shall be automatically entitled to such more favorable rights, preferences or privileges.] [NTD: To include only in the lock-up agreement of Noble Elite]
14. Upon the release of any of the Shareholder’s Subject Securities from this Agreement, the PubCo shall promptly facilitate the timely preparation and delivery of certificates or the establishment of book-entry positions at PubCo’s transfer agent representing the Shareholder’s Subject Securities without the restrictive legend above or the withdrawal of any stop transfer instructions by virtue of this Agreement.
[remainder of page intentionally left blank]
5
| Shareholder | ||
| [Shareholder Name] [NTD: To include Sponsor, Company Founder, Noble Elite and such other parties that may be agreed by the Parties] | ||
| By: | ||
| Name: | ||
| Title: | ||
| Address: | ||
[Signature Page to Lock-up Agreement]
6
| PubCo | ||
| [PUBCO] | ||
| By: | ||
| Name: | ||
| Title: | ||
| Address: | ||
[Signature Page to Lock-up Agreement]
7
Exhibit 10.6
| NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES. |
WARRANT TO PURCHASE CLASS A ORDINARY SHARES
[●]1
| Warrant Shares: [●]2 | |
| Issuance Date: [Acquisition Merger Closing Date] |
THIS WARRANT TO PURCHASE CLASS A ORDINARY SHARES (the “Warrant”) certifies that, for value received, CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted limited liability company or its permitted assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the Issuance Date and on or prior to 5:00 p.m. (New York City time) on the fifth (5th) anniversary of the Issuance Date (the “Termination Date”) but not thereafter, to subscribe for and purchase from [●], a Cayman Islands exempted company limited by shares (the “Company”), up to [●]3 Class A Ordinary Shares (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one (1) Class A Ordinary Share under this Warrant shall be equal to the Exercise Price, as defined in Section 2.2.
| 1. | Definitions. In addition to the terms defined elsewhere in this Warrant or in the Business Combination Agreement dated October 6, 2026 by and among the Company, the Holder, and certain other parties thereto (the “Business Combination Agreement”), the following terms have the meanings indicated in this Section 1: |
1.1. “Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
1.2. “Binance Warrant” means (i) the warrant issued or to be issued by First Digital Group Limited to Alphanest Holdings Ltd, a company organized and existing under the laws of the United Arab Emirates, or its Affiliates, and (ii) the warrant issued or to be issued by the Company to Alphanest Holdings Ltd, a company organized and existing under the laws of the United Arab Emirates, or its Affiliates, in each case to the extent being effective as of the relevant time.
1.3. “Board of Directors” means the board of directors of the Company.
1.4. “Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York or Hong Kong are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed in The City of New York or in Hong Kong (as the case may be) due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York or Hong Kong (as the case may be) generally are open for use by customers on such day.
| 1 | To confirm name of the post business combination PubCo to be listed. |
| 2 | [1,891,667]+[Remaining Working Capital Warrant Coverage (as defined in Business Combination Agreement)] |
| 3 | [1,891,667]+[Remaining Working Capital Warrant Coverage (as defined in Business Combination Agreement)] |
1.5. “Class A Ordinary Share” means the Class A Ordinary Shares of the Company, $[ ] par value per share, and any other class of securities into which such securities may hereafter be reclassified or changed.
1.6. “Class A Ordinary Share Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Class A Ordinary Shares, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Class A Ordinary Shares.
1.7. “Commission” means the United States Securities and Exchange Commission.
1.8. “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
1.9. “Exempt Issuance” means the issuance, sale, grant or entry into agreement to issue, sell or grant, of (i) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) or any employee stock options or other equity awards (x) under the Company’s equity compensation plans (including the PubCo Equity Incentive Plan) or (y) pursuant to the terms of the Business Combination Agreement or the other Transaction Documents (including the earn-out shares issued or issuable to the Founder and the Sponsor under the Founder Earn-Out Agreement and the Sponsor Share Restructuring Agreement, as well as any securities issued upon exercise or conversion thereof), (ii) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) issued or assumed in connection with the Business Combination Agreement, (iii) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) issued or issuable pursuant to any equipment lease, loan, credit facility, or similar financing arrangement with a bank, equipment lessor, or other financial institution approved by the Board of Directors, (iv) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) issued or issuable upon conversion, exchange or exercise of any Convertible Securities outstanding as of the date hereof, (v) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) issued or issuable in connection with any stock split, stock dividend, recapitalization, or similar transaction effected without receipt of consideration that affects all holders of Class A Ordinary Shares on a pro rata basis, (vi) any securities (including Class A Ordinary Shares and Class A Ordinary Shares Equivalents) issued or issuable in connection with a bona fide acquisition (whether by merger, consolidation, purchase of substantially all assets, or otherwise) approved by the Board of Directors, (vii) any securities issued upon conversion of Class B ordinary shares of the Company, (viii) any securities issued pursuant to the Business Combination Agreement or the other Transaction Documents, (ix) the Binance Warrant or any securities issued pursuant to the Binance Warrant or (x) the Noble Elite Warrant or any securities issued pursuant to the Noble Elite Warrant.
1.10. “Noble Elite Warrant” means (i) the warrant issued or to be issued by First Digital Group Limited to Noble Elite Ltd., a company organized and existing under the laws of the Cayman Islands, or its Affiliates, and (ii) the warrant issued or to be issued by the Company to Noble Elite Ltd., a company organized and existing under the laws of the Cayman Islands, or its Affiliates, in each case to the extent being effective as of the relevant time.
1.11. “Lock-Up Period” shall have the meaning ascribed to such term in the Lock-Up Agreement.
1.12. “Lock-Up Agreement” means the lock-up agreement, dated [●], by and among the Holder and the Company.
1.13. “Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
1.14. “Registrable Securities” shall have the meaning ascribed to such term in the Registration Rights Agreement.
2
1.15. “Registration Rights Agreement” shall have the meaning ascribed to such term in the Business Combination Agreement.
1.16. “Registration Statement” means a registration statement meeting the requirements set forth in the Registration Rights Agreement and covering the resale by the Holder of the Registrable Securities.
1.17. “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
1.18. “Subsidiary” means any Person that is Controlled, directly or indirectly, by the Company.
1.19. “Trading Day” means any weekday on which the Trading Market on which the Class A Ordinary Shares are listed is open for trading. If the Class A Ordinary Shares is not listed or admitted for trading, “Trading Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in The New York City are authorized or required by law or other governmental action to close.
1.20. “Trading Market” means any of the following markets or exchanges on which the Class A Ordinary Shares are listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing).
1.21. “Transaction Documents” shall have the meaning ascribed to such term in the Business Combination Agreement.
1.22. “Transfer Agent” means Continental Stock Transfer & Trust Company, the current transfer agent of the Company, with a mailing address of 1 State Street, 30th Floor, New York, NY 10004-1561, and any successor transfer agent of the Company.
1.23. “Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional Class A Ordinary Shares either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices of or quotations for the Class A Ordinary Shares at any time after the initial issuance of such debt or equity securities 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 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 Class A Ordinary Shares or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price; provided, however, that “Variable Rate Transaction” shall not include any Exempt Issuance.
1.24. “VWAP” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Class A Ordinary Shares are then listed or quoted on a Trading Market, the daily volume weighted average price of the Class A Ordinary Shares for such date (or the nearest preceding date) on the Trading Market on which the Class A Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if the Class A Ordinary Shares are not then listed or quoted for trading on any Trading Market and if prices for the Class A Ordinary Shares are then reported on the Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the average of the highest closing bid price per Class A Ordinary Share and the lowest closing ask price per Class A Ordinary Share for such date (or the nearest preceding date), or (d) in all other cases, the fair market value of a Class A Ordinary Share as determined by an independent appraiser jointly selected in good faith by the Company and the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be borne by the Company.
1.25. “Warrants” means this Warrant (and any new Warrant issued pursuant to Section 4.2).
3
| 2. | Exercise. |
2.1. Exercise of Warrant. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Issuance Date and on or before the Termination Date by delivery to the Company of a duly executed PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise substantially in the form attached hereto as Exhibit 2.1 (the “Notice of Exercise”). Within the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2.4.1 herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2.3 below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation upon request within three (3) Trading Days following such request. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within two (2) Trading Days of receipt of such notice. The Holder and any permitted assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time shall be less than the amount stated on the face hereof.
2.2. Exercise Price. The exercise price per Warrant Share shall be $11.50, subject to adjustment hereunder (the “Exercise Price”).
2.3. Cashless Exercise. After ninety (90) days after the Acquisition Merger Closing Date (the “Black-Out Period”), (x) if there is no effective registration statement registering, or the prospectus contained therein is not available for the resale of the Warrant Shares by the Holder and (y) A is greater than B (each as defined below), then this Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) × (X)] by (A), where:
| (A) = | the VWAP of the last Trading Day prior to the date of the applicable Notice of Exercise; |
| (B) = | the Exercise Price of this Warrant, as adjusted hereunder; and |
| (X) = | the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise. |
If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the holding period of the Warrant Shares being issued may be tacked on to the holding period of this Warrant. Without limiting any other provision in the Transaction Documents, assuming (i) the Holder is not an Affiliate of the Company, and (ii) all of the applicable conditions of Rule 144 promulgated under the Securities Act with respect to Holder and the Warrant Shares are met in the case of such a cashless exercise, the Company agrees that the Company will cause the removal of the legend from such Warrant Shares (including by delivering an opinion of the Company’s counsel to the Transfer Agent at its own expense to ensure the foregoing), and the Company agrees that the Holder is under no obligation to sell the Warrant Shares issuable upon the exercise of the Warrant prior to removing the legend. The Company agrees not to take any position contrary to this Section 2.3.
Notwithstanding anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2.3.
4
2.4. Mechanics of Exercise.
2.4.1. Delivery of Warrant Shares upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144 (assuming cashless exercise of the Warrants), and otherwise by physical delivery of a certificate or by electronic delivery (at the election of the Holder), for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise, and the Company shall cause such transmission by the date that is the later of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise and the aggregate Exercise Price and (ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”), provided, however, the Warrant Share Delivery Date shall be extended by any delay caused by the Transfer Agent; provided, further, that in any event, the Company shall not be obligated to deliver Warrant Shares until it has received the aggregate Exercise Price therefor. The Holder shall not be deemed as the holder of record of the Warrant Shares until the Warrant Share Delivery Date. Notwithstanding anything herein to the contrary, upon payment of the aggregate Exercise Price for the Warrant Shares (or, in the case of a cashless exercise pursuant to Section 2.3, upon delivery of the Notice of Exercise), the Holder shall be deemed for purposes of Regulation SHO under the Exchange Act to have become the holder of the Warrant Shares irrespective of the date of delivery of the Warrant Shares. If the Company fails to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date and such delay is not caused by the Transfer Agent, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Class A Ordinary Shares on the date of the applicable Notice of Exercise), $10 per Trading Day for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a Transfer Agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect to the Class A Ordinary Shares as in effect on the date of delivery of the Notice of Exercise, which in any event shall not be more than two (2) Trading Days after the delivery to the Company of the Notice of Exercise.
2.4.2. Delivery of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares (subject to receipt of the aggregate Exercise Price for the applicable exercise), deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.
2.4.3. Rescission Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2.4.1 by the Warrant Share Delivery Date (so long as such failure is not caused by the Transfer Agent), then the Holder will have the right to rescind such exercise.
2.4.4. Compensation for Buy-In on Failure to Timely Deliver Warrant Shares upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2.4.1 above pursuant to an exercise on or before the Warrant Share Delivery Date (other than due to any delay caused by the Transfer Agent), and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, Class A Ordinary Shares to deliver in satisfaction of a sale by the Holder of the Warrant Shares (the “Sale”) which the Holder anticipated receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage
5
commissions, if any) for the Class A Ordinary Shares required to be delivered by the Holder under the Sale exceeds (y) the amount obtained by multiplying (i) the number of Warrant Shares that the Holder was required to deliver under the Sale times (ii) the price at which the Sale giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored and return any amount received by the Company in respect of the Exercise Price for those Warrant Shares (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of Class A Ordinary Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Class A Ordinary Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Class A Ordinary Shares with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company with written notice indicating the amounts payable to the Holder in respect of the Buy-In and evidence of the amount of such loss. Nothing herein shall limit a Holder’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 Class A Ordinary Shares upon exercise of the Warrant as required pursuant to the terms hereof.
2.4.5. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.
2.4.6. Charges, Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares in the Holder’s name, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto as Exhibit 2.4.5 duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
2.4.7. Closing of Books. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.
2.5. Holder’s Exercise Limitations. The Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below) or cause the Company not to be in compliance with the rules of the applicable Trading Market. For purposes of the foregoing sentence, the number of Class A Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Class A Ordinary Shares issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of Class A Ordinary Shares which would be issuable upon (i) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company (including, without limitation, any other Class A Ordinary Share Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2.5, beneficial ownership shall be calculated in accordance with Section 13(d) of
6
the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2.5 applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination and shall have no liability for exercises of the Warrant that are not in compliance with the Beneficial Ownership Limitation. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2.5, in determining the number of outstanding Class A Ordinary Shares, a Holder may rely on the number of outstanding Class A Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Class A Ordinary Shares outstanding. Upon the written or oral request of a Holder, the Company shall within three (3) Trading Days confirm orally and in writing to the Holder the number of Class A Ordinary Shares then outstanding. In any case, the number of outstanding Class A Ordinary Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding Class A Ordinary Shares was reported. The “Beneficial Ownership Limitation” shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99% or such higher percentage as may be permissible by the applicable Trading Market) of the number of Class A Ordinary Shares outstanding immediately after giving effect to the issuance of Class A Ordinary Shares issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2.5, provided that the Beneficial Ownership Limitation in no event exceeds 9.99% (unless otherwise permitted pursuant to the rules of the applicable Trading Market) of Class A Ordinary Shares outstanding immediately after giving effect to the issuance of Class A Ordinary Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2.5 shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2.5 to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
| 3. | Certain Adjustments. |
3.1. Share Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a share dividend or otherwise makes a distribution or distributions on Class A Ordinary Shares or any other equity or equity equivalent securities payable in Class A Ordinary Shares (which, for avoidance of doubt, shall not include any Class A Ordinary Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding Class A Ordinary Shares into a larger number of shares, (iii) combines (including by way of reverse share split) outstanding Class A Ordinary Shares into a smaller number of shares, or (iv) issues by reclassification of Class A Ordinary Shares any shares of share capital of the Company, then in each case the Exercise Price shall be multiplied by a number or a fraction of which the numerator shall be the number of Class A Ordinary Shares (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Class A Ordinary Shares outstanding immediately after such event, and the number of Shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3.1 shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
7
3.2. Subsequent Equity Sales. If, at any time while this Warrant is outstanding (such period, the “Adjustment Period”), the Company issues, sells, enters into an agreement to sell, or grants any option to purchase, or sells, enters into an agreement to sell, or grants any right to reprice, or otherwise disposes of or issues (or announces any offer, sale, grant or any option to purchase or other disposition), or, in accordance with this Section 3.2, is deemed to have issued or sold, any Class A Ordinary Shares or Class A Ordinary Share Equivalents for a consideration per Class A Ordinary Shares (the “Dilutive Issuance Price”) less than a price equal to the Exercise Price in effect immediately prior to such issue or sale or deemed issuance or sale (such Exercise Price then in effect is referred to as the “Applicable Price”) (other than an Exempt Issuance) (the foregoing a “Dilutive Issuance”), then simultaneously with the consummation of such Dilutive Issuance, the Exercise Price then in effect shall be reduced to an amount equal to the Dilutive Issuance Price and the number of Warrant Shares issuable hereunder shall be proportionately increased such that the aggregate Exercise Price of this Warrant on the Issuance Date for the Warrant Shares then outstanding shall remain unchanged. If the Company enters into a Variable Rate Transaction, no adjustment to the Exercise Price shall be made until the Dilutive Issuance Price with respect to such Variable Rate Transaction may be determined. Notwithstanding the foregoing, no adjustments shall be made, paid or issued under this Section 3.2 in respect of an Exempt Issuance. For the avoidance of doubt, in the event the Exercise Price has been adjusted pursuant to this Section 3.2 and the Dilutive Issuance that triggered such adjustment does not occur, is not consummated, is unwound or is cancelled after the facts for any reason whatsoever, the Exercise Price shall be readjusted to the Exercise Price that would have been in effect if such Dilutive Issuance had not occurred or been consummated. For all purposes of the foregoing, the following shall be applicable:
3.2.1. Issuance of Convertible Securities. If, during the Adjustment Period, the Company in any manner grants, issues or sells any option or convertible securities of the Company (other than an Exempted Issuance) (the “Convertible Securities”) and the lowest price per Class A Ordinary Share for which one Class A Ordinary Share is issuable upon the conversion, exercise or exchange thereof (such Class A Ordinary Share, a “Convertible Securities Share”) is less than the Applicable Price, then such Convertible Securities Share shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of this Section 3.2.1, the “lowest price per share for which one Convertible Securities Share is issuable upon the conversion, exercise or exchange thereof” shall be equal to (A) the sum of (1) the lowest amount of consideration (if any) received or receivable by the Company with respect to one Convertible Securities Share upon the issuance or sale of the Convertible Security and upon conversion, exercise or exchange of such Convertible Security and (2) the lowest exercise or conversion price set forth in such Convertible Security for which one Convertible Securities Share is issuable upon conversion, exercise or exchange thereof, minus (B) the sum of all amounts paid or payable to the holder of such Convertible Security plus the value of any other consideration received or receivable by the holder of such Convertible Security, with respect to any one Convertible Securities Share upon the issuance or sale of such Convertible Security. Except as contemplated below, no further adjustment of the Exercise Price shall be made upon the actual issuance of such Convertible Securities Share upon conversion, exercise or exchange of such Convertible Securities, and if any such issue or sale of such Convertible Securities is made upon exercise of any Options for which adjustment of the Exercise Price has been or is to be made pursuant to other provisions of this Section 3.2, except as contemplated below, no further adjustment of the Exercise Price shall be made by reason of such issue or sale.
3.2.2. Change in Option Price or Rate of Conversion. If, during the Adjustment Period, the purchase or exercise price provided for in any Convertible Securities, the additional consideration, if any, payable upon the issue, conversion, exercise or exchange of any Convertible Securities, or the rate at which any Convertible Securities are convertible into or exercisable or exchangeable for Class A Ordinary Shares increases or decreases at any time (other than proportional changes in conversion or exercise prices, as applicable, in connection with an event referred to in Section 3.1), the Exercise Price in effect at the time of such increase or decrease shall be adjusted to the Exercise Price which would have been in effect at such time had such Convertible Securities provided for such increased or decreased purchase price, additional consideration or increased or decreased conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of this Section 3.2.2, if the terms of any Convertible Security that was outstanding as of the date of issuance of this Warrant are increased or decreased in the manner described in the immediately preceding sentence, then such Convertible Security and the Convertible Securities Share deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such increase or decrease.
8
3.2.3. Calculation of Consideration Received. If, during the Adjustment Period, any Convertible Security is issued in connection with the issuance or sale or deemed issuance or sale of any other securities of the Company (the “Primary Security”, and such Convertible Security, the “Secondary Securities” and together with the Primary Security, each a “Unit”), together comprising one integrated transaction, the aggregate consideration per share with respect to such Primary Security shall be deemed to be the sum of (x) the purchase price of such Unit and (y) if such Primary Security is a Convertible Security, the lowest price per share for which one Class A Ordinary Share is at any time issuable upon the exercise or conversion of the Primary Security in accordance with Section 3.2.1 above. If any Class A Ordinary Shares or Convertible Securities are issued or sold or deemed to have been issued or sold for cash, the consideration received therefor will be deemed to be the net amount of cash received by the Company therefor. If any Class A Ordinary Shares or Convertible Securities are issued or sold for a consideration other than cash, the amount of such consideration received by the Company will be the fair value of such consideration, except where such consideration consists of publicly traded securities, in which case the amount of consideration received by the Company for such securities will be the arithmetic average of the VWAPs of such security for each of the twenty (20) Trading Days immediately preceding the date of receipt. If any Class A Ordinary Shares or Convertible Securities are issued to the owners of the non-surviving entity in connection with any merger in which the Company is the surviving entity, the amount of consideration therefor will be deemed to be the fair market value of such portion of the net assets and business of the non-surviving entity as is attributable to such Class A Ordinary Shares or Convertible Securities (as the case may be). The fair market value of any consideration other than cash or publicly traded securities will be determined jointly by the Company and the Holder. If such parties are unable to reach agreement within ten (10) days after the occurrence of an event requiring valuation (the “Valuation Event”), the fair market value of such consideration will be determined within twenty (20) Trading Days after the tenth (10th) day following such Valuation Event by an independent, reputable appraiser jointly selected by the Company and the Holder. The determination of such appraiser shall be final and binding upon all parties absent manifest error and the fees and expenses of such appraiser shall be borne by the Company and the Holder on a 50/50 basis.
3.3. For the avoidance of doubt, the number of Warrant Shares or the Exercise Price shall not be adjusted as a result of the transactions contemplated by the Transaction Documents, the Binance Warrant or the Noble Elite Warrant.
3.4. Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3.1 above, if at any time the Company grants, issues or sells rights to purchase share, warrants, securities or other property pro rata to all (or substantially all) of the record holders of any class of Class A Ordinary Shares (other than an Exempt Issuance) (the “Purchase Rights”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Class A Ordinary Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Class A Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such Class A Ordinary Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
9
3.5. Pro Rata Distributions. During such time as this Warrant is outstanding, prior to the Company’s declaration of any dividend or other distribution of its assets (or rights to acquire its assets) to all (or substantially all) holders of Class A Ordinary Shares, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each such case, the Holder shall not be entitled to participate in such Distribution, but shall be entitled to receive a notice of such Distribution at least 20 days prior to the declaration of the Distribution and the Holder shall be entitled to exercise the Warrant during the period from the receipt of the notice until the declaration of the Distribution in accordance with Section 2, including by way of cashless exercise even if this is during the Black-Out Period.
3.6. Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company or any of its Subsidiaries, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of the assets of the Company and its Subsidiaries (taken as a whole) in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Class A Ordinary Shares are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Class A Ordinary Shares or 50% or more of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Class A Ordinary Shares or any compulsory share exchange pursuant to which the Class A Ordinary Shares are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in a single transaction or a series of related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons acting in concert whereby such other Person or group acting in concert acquires 50% or more of the outstanding Class A Ordinary Shares or 50% or more of the voting power of the common equity of the Company (each a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall only be entitled to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2.5 on the exercise of this Warrant), the consideration (the “Alternate Consideration”) receivable as a result of such Fundamental Transaction by a holder of the number of Class A Ordinary Shares for which this Warrant is exercisable into immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2.5 on the exercise of this Warrant). For purposes of any such exercise, the Exercise Price shall be appropriately adjusted so that the aggregate Exercise Price payable upon the full exercise of this Warrant shall remain the same. Notwithstanding anything to the contrary, in the event of a Fundamental Transaction, the Company or any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) may in its discretion decide to, at any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental Transaction), redeem this Warrant from the Holder by paying to the Holder an amount of cash equal to the Black Scholes Value (as defined below) of the remaining unexercised portion of this Warrant on the date of the consummation of such Fundamental Transaction. Further, the Company or any Successor Entity shall, at the written request of the Holder, at any time concurrently with, or within 30 days after, the consummation of the Fundamental Transaction (or, if later, the date of the public announcement of the applicable Fundamental Transaction), redeem this Warrant from the Holder by paying to the Holder an amount of cash equal to the Black Scholes Value of the remaining unexercised portion of this Warrant on the date of the consummation of such Fundamental Transaction. “Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing Model
10
obtained from the “OV” function on Bloomberg, L.P. (“Bloomberg”) determined as of the day of consummation of the applicable contemplated Fundamental Transaction for pricing purposes and reflecting (A) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction and the Termination Date, (B) an expected volatility equal to the 100 day volatility as obtained from the HVT function on Bloomberg (determined utilizing a 365 day annualization factor) as of the Trading Day immediately following the public announcement of the applicable contemplated Fundamental Transaction, (C) the underlying price per share used in such calculation shall be equal to the sum of the price per share being offered in cash, if any, plus the value of any non-cash consideration, if any, being offered in such Fundamental Transaction and (D) a remaining option time equal to the time between the date of the public announcement of the applicable contemplated Fundamental Transaction and the Termination Date and (E) a zero cost of borrow. The payment of the Black Scholes Value will be made by wire transfer of immediately available funds (or such other consideration) within seven (7) Business Days after the later of (i) the Company or the Successor Entity’s election to redeem this Warrant or the Holder’s written request for the Company to redeem this Warrant (as the case may be) or (ii) the date of consummation of the Fundamental Transaction. To the extent this Warrant will continue to be outstanding after the consummation of the Fundamental Transaction, the Company shall cause the Successor Entity to assume in writing all of the obligations of the Company under this Warrant. Upon the consummation of any such Fundamental Transaction if this Warrant continues to be outstanding, the Successor Entity shall be added to the term “Company” under this Warrant, and the Successor Entity or Successor Entities may exercise every right and power of the Company prior thereto and the Successor Entity or Successor Entities shall assume all of the obligations of the Company prior thereto under this Warrant with the same effect as if such Successor Entity or Successor Entities had been named as the Company herein. For the avoidance of doubt, the Holder shall be entitled to the benefits of the provisions of this Section 3.6 regardless of whether the Company has sufficient authorized Class A Ordinary Shares for the issuance of Warrant Shares.
3.7. Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
3.8. Notice to Holder.
3.8.1. Adjustment to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
3.8.2. Notice to Allow Exercise by Holder. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Class A Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Class A Ordinary Shares, (C) the Company shall authorize the granting to all holders of the Ordinary Share rights or warrants to subscribe for or purchase any shares of share capital of any class or of any rights, (D) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Class A Ordinary Shares, any consolidation or merger to which the Company (or any of its Subsidiaries) is a party, any sale or transfer of all or substantially all of its assets, or any compulsory share exchange whereby the Class A Ordinary Shares are converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, to the extent permitted by applicable Laws, the Company shall cause to be delivered by email to the Holder at its last email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Class A Ordinary Shares of record to be
11
entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Class A Ordinary Shares of record shall be entitled to exchange their Class A Ordinary Shares for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Report of Foreign Private Issuer on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
3.9. Variable Rate Transactions. The Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Class A Ordinary Shares or Class A Ordinary Share Equivalents (or a combination of units thereof) involving a Variable Rate Transaction without the Holder’s consent, so long as the Holder and its affiliates holding Warrant exercisable for Warrant Shares representing at least 5% of the Company’s total outstanding shares on a fully-diluted, as-exercised basis.
3.10. Voluntary Adjustment by Company. Subject to the rules and regulations of the Trading Market and the consent of the Holder, the Company may at any time during the term of this Warrant reduce, in its sole discretion, the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors.
| 4. | Transfer of Warrant. |
4.1. Transferability. During the Lock-Up Period, this Warrant shall not be transferable other than in accordance with the terms of the Lock-Up Agreement. Subject to compliance with any applicable securities laws and the conditions set forth in Section 4.4 hereof and this Section 4.1, after the Lock-Up Period, this Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto as Exhibit 2.4.5 duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days after the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
4.2. New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4.1, as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial Issuance Date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
12
4.3. Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.
4.4. Transfer Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer, that the transferor (other than in connection with a transfer to an Affiliate of the transferor) provide to the Company an opinion of counsel to the effect that such transfer does not require registration of such transferred Warrant under the Securities Act.
4.5. Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities law, except pursuant to sales registered or exempted under the Securities Act. This Warrant, any Warrant issued in substitution or replacement therefor and any Warrant Shares issuable upon such exercise hereof or thereof, shall be stamped or imprinted with a legend in substantially the following form:
“NEITHER THIS SECURITY NOR THE SECURITIES FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.”
| 5. | Miscellaneous. |
5.1. No Rights as Shareholder until Exercise; No Settlement in Cash. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the exercise hereof as set forth in Section 2.4.1, except as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 2.3, in no event shall the Company be required to net cash settle an exercise of this Warrant.
5.2. Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any share certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or share certificate, if mutilated, the Company will make and deliver a new Warrant or share certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or share certificate.
13
5.3. Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.
5.4. Authorized Shares.
5.4.1. Reservation of Authorized and Unissued Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Class A Ordinary Shares a sufficient number of Class A Ordinary Shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Class A Ordinary Shares may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable (which means that no further sums are required to be paid by the holders thereof in connection with the issue thereof) and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
5.4.2. Noncircumvention. Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant, and (ii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
5.4.3. Authorizations, Exemptions and Consents. Before taking any action that would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.
5.5. Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and 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,
14
action or proceeding is improper or is an inconvenient venue for such proceeding. 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 via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant 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 other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding. Notwithstanding the foregoing, nothing in this paragraph shall limit or restrict the federal district court in which a Holder may bring a claim under the federal securities laws.
5.6. Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon resale imposed by state and federal securities laws.
5.7. Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that the right to exercise this Warrant terminates on the Termination Date. No provision of this Warrant shall be construed as a waiver by the Holder of any rights which the Holder may have under the federal securities laws and the rules and regulations of the Commission thereunder. Without limiting any other provision of this Warrant or the Business Combination Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damage to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees (including those of any appellate proceedings), incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
5.8. Notices. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at ___________, or such other email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the e-mail address or address of such Holder appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section 5.8 prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section 5.8 on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Report of Foreign Private Issuer on Form 6-K.
5.9. Limitation of Liability. No provision hereof and no enumeration herein of the rights or privileges of the Holder, in each case in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, shall impose any obligation on the Holder to exercise this Warrant.
15
5.10. Remedies. The Holder and the Company, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. Each party agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
5.11. Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of the Holder from time to time of this Warrant and the Company and shall be enforceable by each of them (and their successors and permitted assigns).
5.12. Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand, and a majority-in-interest of Holders of the Warrants, on the other hand.
5.13. Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
5.14. Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
5.15. Most Favored Nation. If, at any time after the Issuance Date and while this Warrant remains outstanding, the Company issues or sells to any Person any warrant to purchase or subscribe for Class A Ordinary Shares (each, a “Subsequent Warrant”) containing terms that, when taken as a whole, are more favorable to the holder of such Subsequent Warrant than the terms of this Warrant are to the Holder, then the Holder shall be entitled, subject to the conditions and limitations set forth in this Section 5.15, to receive the benefit of such more favorable terms by having this Warrant amended to incorporate such more favorable terms; provided, however, that the following conditions and limitations shall apply:
5.15.1. Prospective Application Only. This Section 5.15 shall apply only to Subsequent Warrants issued after the Issuance Date and shall not apply to any warrants or similar rights issued by the Company or any of its predecessors or Affiliates on or prior to the Issuance Date. For the avoidance of doubt, neither the Binance Warrant nor the Noble Elite Warrant shall be considered a Subsequent Warrant and this Section 5.15 shall not apply to the Binance Warrant or the Noble Elite Warrant.
5.15.2. Exempt Issuance. Notwithstanding the foregoing, the provisions of this Section 5.15 shall not apply to, and the term “Subsequent Warrant” shall not include, any securities issued or issuable pursuant to an Exempt Issuance.
5.15.3. Holistic Comparison. In determining whether the terms of a Subsequent Warrant are more favorable than the terms of this Warrant, the comparison shall be made on the basis of the terms of such Subsequent Warrant taken as a whole in comparison to the terms of this Warrant taken as a whole, and not on a term-by-term, provision-by-provision, or cherry-picked basis, and the number of the Class A Ordinary Shares issuable under a Subsequent Warrant should be disregarded. The Holder’s sole remedy under this Section 5.15, if available, shall be to have this Warrant amended so that its terms are identical in all material respects to the terms of the Subsequent Warrant that triggered the Holder’s rights hereunder.
16
5.15.4. Notice and Election. The Company shall notify the Holder in writing within fifteen (15) Business Days after the issuance of any Subsequent Warrant that may give rise to rights under this Section 5.15, which notice shall include a summary of the material terms of such Subsequent Warrant. Within thirty (30) days after receipt of such notice (the “Election Period”), the Holder may elect to receive the benefit of the more favorable terms by delivering written notice to the Company (an “MFN Election Notice”). If the Holder does not deliver an MFN Election Notice within the Election Period, the Holder shall be deemed to have irrevocably waived its rights under this Section 5.15 with respect to such Subsequent Warrant.
5.15.5. Amendment Mechanics. If the Holder timely delivers a valid MFN Election Notice in accordance with Section 5.15.4, the Company shall, within thirty (30) days following receipt of such MFN Election Notice, prepare and deliver to the Holder an amendment to this Warrant reflecting the more favorable terms of the applicable Subsequent Warrant, which amendment shall be effective upon execution by the Company and the Holder. The Holder shall execute and return such amendment within fifteen (15) Business Days of receipt; failure to do so shall constitute a waiver of the Holder’s election with respect to such Subsequent Warrant.
5.16. Termination. This Warrant shall terminate and be of no further force and effect upon the full exercise of this Warrant and completion of the delivery of all Warrant Shares subject to this Warrant.
********************
[Warrant Signature Page Follows]
17
[Warrant Signature Page]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
| [●] | ||
| By: | ||
| Name: | ||
| Its: | ||
18
Exhibit 2.1
NOTICE OF EXERCISE
| To: | [FIRST DIGITAL GROUP HOLDING LTD.] |
(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box):
| ☐ | in lawful money of the United States. |
| ☐ | if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2.3, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2.3. |
(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
The Warrant Shares shall be delivered to the following DWAC Account Number:
(4) The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933, as amended.
19
[SIGNATURE OF HOLDER]
| Name of Investing Entity: | |
| Signature of Authorized Signatory of Investing Entity: | |
| Name of Authorized Signatory: | |
| Title of Authorized Signatory: | |
| Date: |
20
Exhibit 2.4.5
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to exercise the Warrant to purchase Class A Ordinary Shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
| Name: | ||
| Address: | ||
| Phone Number: | ||
| Email Address: | ||
| Date: | ||
| Holder’s Signature: | ||
| Holder’s Address: |
21
Exhibit 10.7
FORM OF JOINDER AGREEMENT
This Joinder Agreement (this “Agreement”) is made and entered into as of [●], 20[●], by and between [Merger Sub Name], a Cayman Islands exempted company (“Merger Sub”) (as applicable, the “Joining Party”), CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares with registration number 412434 (“Acquiror”), and First Digital Group Ltd., a Gibraltar private company limited by shares with registration number 121963 (the “Company”).
Recitals
WHEREAS, the Acquiror and the Company are parties to that certain Business Combination Agreement, dated as of October 6, 2026 (as amended, supplemented, or otherwise modified from time to time, the “Business Combination Agreement”);
WHEREAS, the Business Combination Agreement contemplates that, following the execution thereof, PubCo and Merger Sub will be formed and will become parties to the Business Combination Agreement;
WHEREAS, the Joining Party has been duly formed under the laws of its jurisdiction of organization; and
WHEREAS, pursuant to Section 9.12 of the Business Combination Agreement, the Joining Party is required to execute and deliver this Agreement to become a party to, and be bound by the terms of, the Business Combination Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
Article I — Joinder
Section 1.1 Joinder to Business Combination Agreement. The Joining Party hereby (a) joins and becomes a party to the Business Combination Agreement, (b) agrees to be bound by all terms, conditions, rights, and obligations applicable to it under the Business Combination Agreement as if it had been an original signatory thereto, and (c) assumes all duties, liabilities, and obligations applicable to it arising under or in connection with the Business Combination Agreement. The Company and the Acquiror hereby acknowledges and consents to the joinder of the Joining Party to the Business Combination Agreement.
Section 1.2 Adoption of Representations, Warranties, and Covenants. The Joining Party hereby adopts and agrees to be bound by all representations, warranties, covenants, and agreements made by or applicable to it in the Business Combination Agreement (including without limitation those set forth in Article VI, Article VIII and Article IX, with the same force and effect as if such representations, warranties, covenants, and agreements had been made directly by the Joining Party as of the date of the Business Combination Agreement.
Article II — Representations and Warranties
In addition to the representations and warranties given by the Joining Party pursuant to Article VI of the Business Combination Agreement, the Joining Party also represents and warrants to the Company as follows:
Section 2.1 Capitalization. As of the date hereof, the authorized share capital of Merger Sub consists of [●] ordinary shares, par value US$[●] per share, of which [●] such shares are issued and outstanding as of the date hereof. As of the date hereof, Merger Sub is a direct wholly owned subsidiary of the Acquiror. No equity interests of the Joining Party have been issued other than as contemplated by the Business Combination Agreement.
Article III — Miscellaneous
Section 3.1 Business Combination Agreement Controls. Except as expressly set forth herein, all terms and conditions of the Business Combination Agreement shall remain in full force and effect. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Business Combination Agreement. In the event of any conflict between the terms of this Agreement and the Business Combination Agreement, the Business Combination Agreement shall control.
Section 3.2 Governing Law. This Agreement and all matters arising out of or relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction.
Section 3.3 Miscellaneous. Section 12.8, Section 12.15, and Section 12.16 of the Business Combination Agreement shall apply to this Agreement mutatis mutandis.
2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.
| [MERGER SUB NAME] | ||
| By: | ||
| Name: | ||
| Title: | ||
| CSLM III HOLDINGS LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
| CSLM Digital Asset Acquisition Corp III, Ltd | ||
| By: | ||
| Name: | ||
| Title: | ||
| First Digital Group Ltd. | ||
| By: | ||
| Name: | ||
| Title: | ||
3
Exhibit 10.8
This WARRANT INSTRUMENT (the “Instrument”) is dated _____________________.
PARTIES
| (1) | CSLM III HOLDINGS, LTD, an exempted company limited by shares incorporated under the laws of the Cayman Islands with its registered office at Ascentium (Cayman) Limited, 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands (the “Company”); and |
| (2) | ALPHANEST HOLDINGS LTD, a company organized and existing under the laws of the United Arab Emirates with its registered office at Office 911 9th Floor, Addax Port Office Tower Tamouh Al Reem Island Abu Dhabi United Arab Emirates (the “Warrantholder”), |
(each a “Party” and collectively the “Parties”).
BACKGROUND
| (A) | FDG (as defined below) has created and issued the FDG Warrant (as defined below) to the Warrantholder on the terms set out therein. |
| (B) | FDG and the Warrantholder agree that the FDG Warrant will automatically terminate and expire upon the consummation of the de-SPAC Transaction (as defined below) and upon, and in consideration of, the execution and delivery by the Company of this Instrument, entitling the Warrantholder to subscribe for a number of Class A Ordinary Shares (as defined below) equal to the number of unsubscribed FDG Warrant Shares (as defined below) multiplied by the Exchange Ratio (as defined below). |
| (C) | In connection with the above, the Company has agreed to create and issue the Warrants (as defined below) entitling the Warrantholder to subscribe for the Warrant Shares (as defined below) on the terms set out in this Instrument. |
NOW, THEREFORE, for good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the Parties agree as follows:
AGREED TERMS
| 1. | INTERPRETATION |
| 1.1 | The definitions and rules of interpretation set out in this Clause 1 shall apply to this Instrument. |
Acquisition Merger Effective Time: has the meaning given to it in the BCA as at the time it is executed.
Affiliate: means, with respect to an entity or a person, any other entity or person that such entity or person controls, is controlled by or is under common control with, or any of their respective legal successors. For the purposes of this definition, “control” means the possession, directly or indirectly, of the power to elect or dismiss a majority of the board of directors (or other governing body) or to direct or cause the direction of the management and policies of such party, entity or person, whether through ownership of voting securities or otherwise;
AML: has the meaning given in Clause 6.1(b)(i).
Articles: the amended and restated memorandum and articles of association of the Company as may be amended from time to time.
Authority: any nation, any political subdivision thereof, whether state or local, any international organization, and any agency, authority, instrumentality, judicial or administrative, regulatory body, law enforcement body, securities or futures exchange, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
Business Day: a day (other than a Saturday, Sunday or public holiday in Hong Kong SAR, the Cayman Islands or United Arab Emirates) on which banks are generally open for business in Hong Kong SAR, the Cayman Islands and United Arab Emirates.
Business Combination Agreement or BCA: the business combination agreement by and among the Company, FDG, SPAC and certain other parties thereto.
Class A Ordinary Shares: Class A ordinary shares of the Company, having the rights and subject to the restrictions set out in the Articles, each of which shall be entitled to one (1) vote at any general meeting of the Company or pursuant to unanimous written resolutions of shareholders of the Company.
Completion: the completion of any and each exercise of the Warrants.
Completion Date: any date on which Completion occurs.
Completion Payment: the Subscription Price.
consummation of the de-SPAC Transaction: the occurrence of the “Acquisition Merger Effective Time” as defined in the BCA as at the time it is executed.
SPAC: CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares.
de-SPAC Transaction: the transactions contemplated by the Business Combination Agreement, or such other similar transaction pursuant to which the Company or any other entity owning the Company becomes listed on a recognized stock exchange.
Dispute: has the meaning given in Clause 18.1(a).
Exchange Ratio: has meaning given to it in the BCA, as applied to all holders of preference shares of FDG.
Exercise Period: the period from the calendar day falling immediately after the end of the Lock-Up Period, to the date that is ten (10) years after the date of the FDG Warrant.
Exercise Price: in respect of the Warrant Shares, the price per share equal to USD 0.001.
FDG: means FIRST DIGITAL GROUP LIMITED, a private company limited by shares incorporated in Gibraltar with company number 121963.
FDG Warrant: the warrant created and issued by FDG to the Warrantholder on October 6, 2026 entitling the Warrantholder to subscribe for the FDG Warrant Shares (as may be amended, restated, supplemented and modified from time to time).
FDG Warrant Shares: means 12,051,791 preference shares in the capital of FDG under the FDG Warrant.
Group Companies: means the Company and each and any of its subsidiaries from time to time, including, for the avoidance of doubt, after giving effect to the closing of the de-SPAC Transaction, and “Group Company” means any one of them.
Issuer: means FD121 (BVI) LIMITED, a private company limited by shares incorporated in the British Virgin Islands with BVI company number 2181483 whose registered office is situated at Ritter House, Wickhams Cay II, PO Box 3170, Road Town, Tortola VG1110, British Virgin Islands.
KYC: has the meaning given in Clause 6.1(b)(i).
2
Lock-up Period: the period commencing on the Acquisition Merger Effective Time and until the earlier of (i) the date that is one hundred and eighty (180) days after the Acquisition Merger Effective Time, or (ii) the date on which the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Company’s shareholders having the right to exchange their shares in the Company or other equity securities of the Company for cash, securities or other property. Notwithstanding the foregoing, after at least 120 days after the Acquisition Merger Effective Time, (a) twenty-five percent (25%) of the Warrant Shares shall be released from the foregoing restrictions upon the date when the closing trading price of the Class A Ordinary Shares equals or exceeds $12.00 for 20 consecutive trading days, and the Lock-up Period shall automatically be deemed to have ended in respect of such percentage of Warrant Shares on such date, (b) up to fifty percent (50%) of the Warrant Shares (including any Warrant Shares that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the Class A Ordinary Shares equals or exceeds $14.00 for 20 consecutive trading days , and the Lock-up Period shall automatically be deemed to have ended in respect of such percentage of Warrant Shares on such date, (c) up to seventy-five percent (75%) of the Warrant Shares (including any Warrant Shares that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the Class A Ordinary Shares equals or exceeds $16.00 for 20 consecutive trading days, and the Lock-up Period shall automatically be deemed to have ended in respect of such percentage of Warrant Shares on such date, and (d) all Warrant Shares (including any Warrant Shares that have already been released prior to such date) shall be released from the foregoing restrictions upon the date when the closing trading price of the Class A Ordinary Shares equals or exceeds $18.00 for 20 consecutive trading days , and the Lock-up Period shall automatically be deemed to have ended on such date, provided that:
(a) in the event that a release is granted to the Sponsor, the Company Founder or any Major Holder (as defined below) relating to the lock-up restrictions set forth in any Lock-up Agreement (as defined in the BCA as at the time it is executed), the same percentage of the Warrant Shares (the “Pro-rata Release”) shall be immediately and fully released on the same terms from any remaining lock-up restrictions set forth herein and the Lock-up Period shall automatically be deemed to have ended in respect of such percentage of Warrant Shares. For purposes of this Agreement, a “Major Holder” shall mean each record or beneficial owner, as of immediately prior to the Acquisition Merger Effective Time, of more than five percent (5%) of the issued and outstanding share capital of the Company. For purposes of determining record or beneficial ownership of a shareholder, all securities held by investment funds affiliated with such shareholder shall be aggregated; and
(b) the effectiveness and validity of the lock-up restrictions set forth above is subject to the continuing satisfaction of the condition that each and all of the Sponsor (as defined in the BCA), the Company Founder (as defined in the BCA) and each Major Holder has entered into a legally binding lock-up agreement and/or undertaking with respect to the equity securities of the Company held by each such party which contains at least the same length of lock-up period and other restrictions substantially identical to or at least as restrictive as those under this Agreement and without any right, interest, benefit or privilege granted to any other party more favorable than the terms and conditions under this Agreement (the “Ongoing Condition”). If the Ongoing Condition is not satisfied or ceases to be satisfied (the “Non-Satisfaction”), then the Lock-Up Period shall be deemed to have automatically ended on the first date on which the Non-Satisfaction occurs.
Rules: the rules or regulations of any clearing system, the rules, operating procedures or market practice of any relevant stock exchange or market, any statute, law, regulation, ordinance, rule, judgment, order, decree, permit, concession, grant, franchise, license, agreement (whether concluded voluntarily or involuntarily), directive, requirement of, or other governmental restriction or any similar binding form of decision of or determination by or with, or any binding interpretation or administration of any of the foregoing by or with, any Authority, whether now or hereafter in effect.
Securities: any or all of the following, wherever issued and whether voting or non-voting: (a) shares, stock or other equity interests in the Company (including any fraction of a share); (b) warrants, rights, options or other rights to subscribe for, purchase or otherwise acquire any shares in the Company; (c) any convertible, exchangeable or exercisable securities, notes, debentures, bonds or other instruments issued by the Company or any other person that are convertible into, exchangeable for, or exercisable for any shares or other equity interests in the Company; (d) any other security, instrument or right that directly or indirectly confers a right to acquire, receive or participate in any shares or other equity interests in the Company; and (e) any other securities of the Company that are from time to time treated as “securities” or “equity securities” under applicable law or the Company’s articles of association or equivalent constitutional documents.
Subscription Price: in relation to the exercise of the Warrants, the Exercise Price multiplied by the number of Subscription Shares.
Subscription Rights: has the meaning given in Clause 2.3.
Subscription Shares: in relation to any and each exercise of the Warrants, the number of Warrant Shares being subscribed for.
USD or US$: United States Dollars, the lawful currency of the United States of America.
Warrant: a warrant to subscribe for the Warrant Shares, on the terms and subject to the conditions of this Instrument.
Warrant Shares: means such number of Class A Ordinary Shares equal to the number of unsubscribed FDG Warrant Shares under the FDG Warrant multiplied by the Exchange Ratio.
| 1.2 | Clause and paragraph headings shall not affect the interpretation of this Instrument. |
| 1.3 | References to clauses are to the clauses of this Instrument. |
| 1.4 | A reference to this Instrument is a reference to this Instrument as varied or novated in accordance with its terms from time to time. |
| 1.5 | Unless the context otherwise requires, words in the singular shall include the plural and the plural shall include the singular. |
3
| 1.6 | Unless the context otherwise requires, a reference to one gender shall include a reference to the other genders. |
| 1.7 | A reference to writing or written includes fax and email. |
| 1.8 | Any words following the terms including, include, in particular, for example or any similar expression shall be construed as illustrative and shall not limit the sense of the words, description, definition, phrase or term preceding those words. |
| 1.9 | A reference to a statute or statutory provision is a reference to it as amended or re-enacted from time to time and shall include all subordinate legislation made from time to time under that statute or statutory provision. |
| 2. | CONSTITUTION, GRANT AND FORM OF WARRANTS |
| 2.1 | In consideration for the payment by the Warrantholder to the Company of US$1.00, the receipt of which is hereby acknowledged by the Company, the Company hereby constitutes, grants and issues the Warrants to the Warrantholder to subscribe for the Warrant Shares on the terms and subject to the conditions of this Instrument. |
| 2.2 | The Warrants shall be issued subject to the Articles and otherwise on the terms and subject to the conditions of this Instrument which are binding on the Company and the Warrantholder, and all persons claiming through or under them respectively. |
| 2.3 | The Warrants shall confer the right (but not the obligation) on the Warrantholder to subscribe in USD or stablecoins at the Subscription Price for the Warrant Shares on the terms and subject to the Articles and the conditions of this Instrument (the “Subscription Rights”). Nothing contained herein shall be construed as imposing any liabilities on the Warrantholder to acquire or subscribe for any securities (upon exercise of the Warrants or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. |
| 2.4 | If the Company subdivides (by any subdivision, stock split, stock or share dividend, capitalization, recapitalization, reorganization, reclassification or otherwise) any Class A Ordinary Shares into a greater number of shares or consolidated (by any consolidation, reverse stock split, capitalization, recapitalization, reorganization, reclassification or otherwise) any Class A Ordinary Shares into a smaller number of shares, then, after the date of record for effecting such subdivision or consolidation, the number of Class A Ordinary Shares issuable upon exercise of this Warrant shall be proportionally increased (in the case of a subdivision) or decreased (in the case of a consolidation) so that the percentage of Warrant Shares, after the subdivision or consolidation, of the total number of Class A Ordinary Shares outstanding will be equal to the percentage of Warrant Shares, immediately prior to such subdivision or consolidation, of the total number of Class A Ordinary Shares outstanding immediately prior to such subdivision or consolidation. In addition, the Exercise Price shall be proportionally decreased (in the case of a subdivision) or increased (in the case of a consolidation) to appropriately reflect such subdivision or consolidation. |
| 3. | REGISTER AND CERTIFICATES |
| 3.1 | The Company shall not be obliged to issue any certificate representing the Warrants but shall, in accordance with the laws of the Cayman Islands and the Articles (if applicable), maintain a register of warrants and warrant holders. |
| 3.2 | The Company shall cause the Warrant Shares to be included in any stock exchange listing and registration rights agreement in connection with the de-SPAC Transaction, provided that the Warrantholder shall enter into the Registration Rights Agreement (as defined in the BCA) in connection with the consummation of the de-SPAC Transaction. |
| 4. | EXERCISE AND LAPSE OF SUBSCRIPTION RIGHTS |
| 4.1 | Subject to Clause 4.3 below, the Warrantholder may exercise its Subscription Rights in accordance with this Instrument at any time during the Exercise Period. For the avoidance of doubt, if any Warrant Shares are released from the lock-up restrictions set forth in the definition of “Lock-up Period”, the Lock-up Period shall automatically be deemed to have ended on such date in respect of such Warrant Shares, and the Warrantholder may exercise its Subscription Rights to subscribe for any or all of such Warrant Shares during the Exercise Period in accordance with the Instrument. |
4
| 4.2 | The Warrantholder may exercise its Subscription Rights in whole or in part on a single occasion or on multiple occasions by written notice to the Company given in accordance with Clause 15. Such notice shall state that number of Subscription Shares the Warrantholder intends to subscribe for, provided that such number, when added to the aggregate number of Subscription Shares already subscribed for in all previous exercises of the Warrantholder’s Subscription Rights, shall not exceed the total number of Warrant Shares. If the Warrantholder does not exercise its Subscription Rights in their entirety, the Warrantholder will be entitled to receive from the Company within a reasonable time after the date of any such partial exercise in accordance with the terms hereof, and in any event not exceeding three Business Days after the date thereof, a new warrant instrument in substantially identical form for the subscription of that number of Warrant Shares equal to the difference between the number of Warrant Shares subject to this Instrument and the number of Warrant Shares as to which the Warrantholder exercises its Subscription Rights. |
| 4.3 | Any Subscription Rights not exercised before the expiry of the Exercise Period shall automatically lapse and cease to be exercisable. |
| 4.4 | The Warrantholder (and not the Company) has the right in its sole discretion to terminate this Instrument immediately upon written notice to the Company before it exercises its Subscription Rights (in whole or in part). |
| 4.5 | The Company shall not effect any exercise of this Warrant, and the Warrantholder shall not have the right to exercise its Subscription Right under this Warrant, to the extent that after giving effect to such issuance after exercise, the Warrantholder (together with the Warrantholder’s Affiliates, and any other persons acting as a group together with the Warrantholder or any of the Warrantholder’s Affiliates (such persons, “Attribution Parties”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Class A Ordinary Shares beneficially owned by the Warrantholder and its Affiliates and Attribution Parties shall include the number of Class A Ordinary Shares issuable upon exercise of the Subscription Rights with respect to which such determination is being made, but shall exclude the number of Class A Ordinary Shares which would be issuable upon (i) exercise of the remaining, nonexercised Subscription Rights pursuant to the Warrants beneficially owned by the Warrantholder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any convertible notes, convertible preferred stock, or other warrants), subject to a limitation on conversion or exercise analogous to the limitation contained herein, beneficially owned by the Warrantholder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Clause 4.5, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Clause 4.5 applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Warrantholder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Warrantholder, and the submission of notice pursuant to Clause 4.2 shall be deemed to be the Warrantholder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Warrantholder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Clause 4.5, in determining the number of outstanding Class A Ordinary Shares, a Warrantholder may rely on the number of outstanding Class A Ordinary Shares as reflected in (A) the Company’s most recent periodic or annual report filed with the U.S. Securities and Exchange Commission (the “SEC”), as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Company’s transfer agent setting forth the number of Class A Ordinary Shares outstanding. Upon the written or oral request of a Warrantholder, the Company shall within one Business Day confirm orally and in writing to the Warrantholder the number of Class A Ordinary Shares then outstanding. In any case, the number of outstanding Class A Ordinary Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Warrantholder or its Affiliates or Attribution Parties since the date as of which such number of Class A Ordinary Shares was reported. The “Beneficial Ownership Limitation” shall be 4.99% of the number of Class A Ordinary Shares outstanding immediately after giving effect to the issuance of Class A Ordinary Shares issuable upon exercise of this Warrant. The Warrantholder, upon notice to the Company, may increase, decrease or waive the Beneficial Ownership Limitation provisions of this Clause 4.5. Any amendment to the Beneficial Ownership Limitation will not be effective until the sixty first (61st) calendar day after such notice is delivered to the Company. The provisions of this paragraph (or any portion hereof) shall be construed and implemented in a manner necessary or desirable to properly give effect to the intended the Beneficial Ownership Limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant. |
5
| 5. | COMPLETION |
| 5.1 | Completion shall take place within fifteen Business Days after each date on which the Warrantholder exercises its Subscription Rights in accordance with Clause 4.2, at such time and place as the Parties may agree. The Warrantholder shall use its reasonable efforts to cooperate with the Company to comply with all AML and KYC requirements of the Company, its registered agent, registered office, registrar and transfer agent or any regulator or stock exchange prior to and after the Completion Date, including but not limited to providing without undue delay such due diligence information and documents in respect of the Warrantholder that the Company, its registered agent, registered office, registrar and transfer agent or any regulator or stock exchange may reasonably request. |
| 5.2 | At Completion, the Warrantholder shall remit the Completion Payment to the Company by way of USD or stablecoins (at the sole discretion of the Warrantholder) and shall give instructions to remit the Completion Payment to the Company’s bank account or shall remit the Completion Payment to the Company’s crypto wallet, as the case may be; provided that if the Warrantholder has opted for payment by way of stablecoins, any such stablecoin must be either (i) issued by the Issuer; (ii) be one of USDT, USDC, FDUSD, U, or otherwise on the list of acceptable stablecoins as identified by the Company from time to time; or (iii) otherwise agreed to between the Company and the Warrantholder. Payment of the Completion Payment shall be made to (as applicable) such wallet address or bank account designated by the Company and notified to the Warrantholder in writing not later than five Business Days after the giving of the written notice referred to in Clause 4.2. The Warrantholder will provide the Company with proof of such remittance. For the avoidance of doubt, the Company may not actually receive the Completion Payment on its bank account and crypto wallet (as the case may be) on the Completion Date. |
| 5.3 | Against proof delivered to the Company of the Completion Payment having been remitted, the Company shall, on the same Business Day that such proof is delivered to it (or where such proof is delivered to the Company after 4pm Hong Kong SAR time on a Business Day or on a day that is not a Business Day, on the next Business Day after such delivery) cause a meeting of the directors of the Company to be duly convened and held or written resolutions of the directors of the Company to be passed in accordance with the Articles pursuant to which the following resolutions shall be passed to (save to the extent such resolutions have already been passed): |
| (a) | allot and issue to the Warrantholder (or to such other person as the Warrantholder may direct) the Warrant Shares; |
| (b) | enter the Warrantholder (or such other person as the Warrantholder may direct, as applicable) in the Company’s register of members as the holder of the number of Warrant Shares issued to it; |
| (c) | if requested by the Warrantholder or otherwise required pursuant to applicable law, deliver to the Warrantholder (or such other person as the Warrantholder may direct, as applicable) a copy of a duly executed share certificate for the number of Warrant Shares issued to it; and |
| (d) | make all necessary filings with the Registrar of Companies in the Cayman Islands, |
and shall ensure that the actions in (a) to (d) are completed on said same Business Day.
| 5.4 | The Warrant Shares issued under Clause 5.3(a) shall: |
| (a) | be duly and validly issued, fully paid and non-assessable; |
| (b) | rank pari passu and form one class with the other fully paid shares of the same classes then in issue, subject to the Articles; and |
| (c) | entitle the registered holder to receive any dividend or other distribution announced or declared in accordance with the Articles on or after the relevant Completion Date. |
| 5.5 | No fractions of a Warrant Share shall be allotted or issued on the exercise of any Subscription Rights and no refund will be made to the Warrantholder exercising such Subscription Rights. If the exercise of any Subscription Rights would require a fraction of a Warrant Share to be allotted, the aggregate number of Warrant Shares so allotted to a Warrantholder will be rounded down to the nearest whole Warrant Share. |
6
| 6. | TRANSFER OF WARRANTS |
| 6.1 | To the extent permitted by applicable Rules, the Warrants shall be freely transferable by the Warrantholder by means of an instrument of transfer in any usual form: |
| (a) | to any Affiliate of the Warrantholder, without requiring the prior consent of the Company; and |
| (b) | to any other person, with the prior written consent of the Company, provided that: |
| (i) | the Warrantholder shall provide written notice to the Company prior to any such transfer, including the name of the proposed transferee and such other information as the Company may reasonably request including any information for the purposes of completing anti-money laundering (“AML”) and “know your customer” (“KYC”) checks by the Company as required by applicable Rules; and |
| (ii) | such consent shall not be withheld unless the Company is able to reasonably demonstrate that such transfer would have an adverse impact on the status of any licence held by the Company or its Affiliates which is necessary for the operation of its business, the general regulatory status of the Company, its Affiliates and the stablecoins issued by the Issuer, and/or the relationships between the Company, its Affiliates and any person providing banking services to the Company or its Affiliates; and |
provided, however, any transfer under Clause 6.1(a) or 6.1(b) shall be subject to the satisfactory completion of AML and KYC checks by the Company as required by applicable Rules, and the Warrantholder shall not exercise, convert, transfer, assign or otherwise realise upon the Warrants until the Exercise Period has commenced.
| 6.2 | An instrument of transfer shall be made under hand and executed by or on behalf of the transferor but need not be signed by the transferee. |
| 7. | COMPANY REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS |
| 7.1 | The Company represents and warrants to the Warrantholder that, as at the date hereof (after giving effect to the closing of the de-SPAC Transaction) and each Completion Date (except that (i) a warranty which is expressly specified to be given on a particular date is made only on such date and (ii) the warranties in 7.1(p) to 7.1(t) are made on the date hereof and as at consummation of the de-SPAC Transaction), in each case except for any matter that has been publicly disclosed in any report, document or filing filed with or furnished to the SEC by the Company or the SPAC prior to the date on which each representation and warranty is being given: |
Share Capital
| (a) | This Instrument has been duly authorized, executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms; |
| (b) | Each Group Company is duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organisation and has all requisite corporate power and authority to own its properties and assets and to carry on its business as now conducted and as presently proposed to be conducted; |
| (c) | The Warrant Shares, when issued, sold and allotted in accordance with the terms of this Instrument and the Articles for the consideration expressed herein, (i) will be duly and validly issued, fully paid and non-assessable, (ii) will be free of encumbrances and restrictions on transfer other than those expressly provided herein or as imposed thereon pursuant to applicable law or the Articles, and (iii) will have the rights, powers and preferences (if any) of the Class A Ordinary Shares as provided in the Articles. |
7
| (d) | There is no encumbrance, and there is no agreement, arrangement or obligation to create or give any encumbrance, in relation to any of the Warrant Shares or new shares or equity interests in the capital of any Group Company. |
| (e) | The shares in each Group Company have been validly authorised, allotted and issued and fully paid-up. |
Capacity, Authority, and Insolvency
| (f) | The Company has the full power and authority to execute this Instrument and to exercise its right and perform its obligations hereunder. |
| (g) | The execution of this Instrument and the subscription for and issuance of the Subscription Shares are not in breach of any applicable Rules. |
| (h) | This Instrument has been duly authorized, executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. |
| (i) | The execution, delivery and performance of this Instrument shall not result in a breach of any of the terms or provisions of, or constitute a default under, any applicable Rules or to be in conflict with any agreement or arrangement to which the Company is a party. |
| (j) | No Group Company is insolvent or unable to pay its debts as they fall due. |
No TID U.S. Business Activities
| (k) | As at the date hereof, neither the Company, nor any entity that the Company “controls,” as defined in 31 C.F.R. § 800.208, or in which the Company holds an equity interest and any rights described in 31 C.F.R. § 800.211, (i) produces, designs, tests, manufactures, fabricates or develops any “critical technologies” as that term is defined in 31 C.F.R. §800.215; (ii) performs the functions as set forth in column 2 of appendix A to 31 C.F.R. Part 800 with respect to “covered investment critical infrastructure”, as that term is defined in 31 C.F.R. § 800.212; or (iii) maintains or collects, directly or indirectly, “sensitive personal data” of U.S. citizens, as defined in 31 C.F.R. § 800.241. |
Compliance with law
| (l) | As at the date hereof, save as disclosed under the FDG Warrant, each Group Company has conducted its business in all material respects in accordance with all applicable laws and all required permits, licences and approvals have been obtained and all conditions applicable thereto complied with and so far as the Company is aware there are no circumstances which might lead to the suspension, alteration or cancellation of any such permits, licences or approvals, nor is there any agreement which materially restricts the fields within which such Group Company may carry on its business. |
| (m) | As at the date hereof, save as disclosed under the FDG Warrant, the operations of each Group Company are, and have at all times been, conducted in all material aspects in compliance with all AML laws and all applicable financial record keeping and reporting requirements, rules, regulations and guidelines (collectively, “AML Laws”) and no investigation, action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving any Group Company with respect to AML Laws is pending and, so far as the Company is aware, no such actions, suits or proceedings are threatened or contemplated. |
8
| (n) | As at the date hereof and as far as the Company is aware, no Group Company, no director, officer, employee, agent or distributor of a Group Company, and no other person associated with or acting on behalf of a Group Company has (i) violated or is in violation of any anti-corruption or anti-bribery laws in any material aspects, or (ii) made, offered to make, promised to make or authorised the payment or giving of, directly or indirectly, any bribe, rebate, payoff, influence payment, facilitation payment, kickback or other unlawful payment or gift of money or anything of value prohibited under any applicable law or regulation (any such payment, a “Prohibited Payment”). Each Group Company has put in place adequate procedures to prevent any Prohibited Payment. |
| (o) | As at the date hereof, save as disclosed under the FDG Warrant and as far as the Company is aware, no Group Company, or director, officer, agent, employee, significant shareholder or Affiliate of a Group Company has been subject to any investigation by any governmental agency with regard to any Prohibited Payment. |
Schedule I
| (p) | Schedule I sets out a true, complete, accurate and not misleading list of, as at the consummation of the de-SPAC Transaction, the Company’s allotted and issued share capital on a fully diluted and as-converted basis, provided that the assumptions set forth in the “Assumptions” section in Schedule I are accurate. |
| (q) | The Company has not and will not, between the date of the BCA and the consummation of the de-SPAC Transaction (both dates included), issue any new Securities which are not contemplated or included in Schedule I, save for any Securities issued pursuant to the Transaction Financing (as defined in the BCA as at the time it is executed). |
Lock-up
| (r) | All directors, officers and shareholders of more than 5% or more of the voting equity securities of the Company as at the consummation of the de-SPAC Transaction will enter into the Lock-up Agreement (as defined in the BCA as at the time it is executed) on or before the consummation of the de-SPAC Transaction. |
Earn-out
| (s) | As at the consummation of the de-SPAC Transaction (both dates included), (i) the Sponsor Share Restructuring Agreement (as defined in the BCA) shall have been executed in accordance with Section 8.11 of the BCA, (ii) the earn-out conditions and schedule in the Sponsor Share Restructuring Agreement (as defined in the BCA) shall correspond in all material respects to Section 8.11 and Schedule 1 of the BCA (as at the time it is executed) and shall not have been amended, and (iii) the maximum number of shares issuable under the Sponsor Share Restructuring Agreement (as defined in the BCA) shall not have been amended. |
| (t) | Between the date of the BCA and the consummation of the de-SPAC Transaction (both dates included), there has not been any amendment to any agreement the Company is party to which has the effect of amending the maximum number of shares or warrants issuable or warrant exercise price under such agreement or any equity-related earn-out schedule or condition or other share vesting schedule or condition, or causing the Company to issue any securities earlier than originally agreed, nor has the Company agreed to any such amendment. |
| 7.2 | The Company undertakes to cooperate fully with the Warrantholder in connection with the exercise of Subscription Rights, including without limitation by providing promptly such due diligence information in respect of the Company that the Warrantholder may reasonably request and by assisting with any engagement that may be required with shareholders of the Company. |
| 7.3 | The Company undertakes to at all times reserve and keep available, out of its authorized but unissued Class A Ordinary Shares, solely for the purpose of providing for the exercise of this Warrant, the aggregate number of Warrant Shares then issuable upon exercise of this Warrant at any time. The Company shall take all such commercially reasonable action as may be necessary to ensure that the Warrant Shares may be issued without violation of any applicable law or regulation or of any requirement of any securities exchange on which the Warrant Shares are then listed or traded. The Company will upon the request of the Warrantholder acknowledge in writing its continuing obligation to afford to the Warrantholder all rights to which the Warrantholder is entitled after such exercise in accordance with the terms of this Warrant. |
9
| 7.4 | The Company undertakes to at all times not make without the Warrantholder’s prior written consent (a) any amendment to any agreement the Company is party to as at the consummation of the de-SPAC Transaction which has the effect of amending the maximum number of shares or warrants issuable or warrant exercise price under such agreement or any equity-related earn-out schedule or condition or other share vesting schedule or condition, or causing the Company to issue any securities earlier than originally agreed, nor agree to any such amendment or (b) any amendment to a Lock-up Agreement (as defined in the BCA as at the time it is executed) with any director, officer or shareholder of more than 5% or more of the voting equity securities of PubCo as at the consummation of the de-SPAC Transaction, nor agree to any such amendment. |
| 7.5 | In the event that the Warrantholder is released from any of its the lock-up restrictions set forth in the definition of “Lock-up Period” or, by virtue of this Agreement, becomes entitled to offer, pledge, sell, contract to sell, or otherwise dispose of any of the Warrant Shares prior to the termination of the Lock-Up Period, the Company shall use its commercially reasonably efforts to provide notification of such to the Warrantholder within three Business Days thereof. Save as waived by the Warrantholder, if the Sponsor (as defined in the BCA), the Company Founder (as defined in the BCA) or any Major Holder (other than the Warrantholder) is entitled to any rights, preferences or privileges with respect to the matters set out herein that are more favorable than those granted to the Warrantholder, the Company shall immediately notify the Warrantholder in writing, and the Warrantholder shall be automatically entitled to such more favorable rights, preferences or privileges. |
| 8. | VARIATION |
| 8.1 | No variation or abrogation of the terms of this Instrument or of all or any of the rights for the time being attached to the Warrants shall be effective (whether or not the Company is being wound up) without each other Party’s written consent. |
| 9. | ENTIRE AGREEMENT |
| 9.1 | This Instrument constitutes the entire agreement between the Parties and supersedes and extinguishes all previous discussions, correspondence, negotiations, drafts, agreements, promises, assurances, warranties, representations, arrangements and understandings between them, whether written or oral, relating to the subject matter hereof. |
| 9.2 | Each Party: |
| (a) | acknowledges that, in agreeing to enter into this Instrument, it has not relied on any express or implied representation, warranty, collateral contract or other assurance made by or on behalf of each other Party before entering into this Instrument; and |
| (b) | waives all rights and remedies which, but for this Clause 9.2 might otherwise be available to it in respect of any such express or implied representation, warranty, collateral contract or other assurance. |
| 10. | FURTHER ASSURANCE |
| 10.1 | At its own expense, each Party shall, and shall use all reasonable endeavours to procure that any necessary third party shall, promptly execute and deliver such documents and perform such acts as the other Party may reasonably require for the purpose of giving full effect to this Instrument. |
| 11. | ASSIGNMENT |
| 11.1 | The Company may not assign any of its rights or obligations under this Instrument without the prior written consent of the Warrantholder, such consent shall not be unreasonably withheld or delayed if the proposed assignment is to an Affiliate of the Company. Any unauthorised assignment or transfer will be void and of no force or effect. |
| 12. | SEVERANCE |
| 12.1 | If any provision of this Instrument or part-provision of this Instrument is or becomes invalid, unenforceable or illegal, it shall be deemed modified to the minimum extent necessary to make it valid, legal and enforceable. If such modification is not possible, the relevant provision or part-provision shall be deemed deleted. Any modification to or deletion of a provision or part-provision under this clause shall not affect the validity and enforceability of the rest of this Instrument. If one Party gives notice to the other of the possibility that any provision or part-provision of this Instrument is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to amend such provision so that, as amended, it is legal, valid and enforceable, and, to the greatest extent possible, achieves the intended commercial result of the original provision. |
10
| 13. | THIRD PARTY RIGHTS |
| 13.1 | Nothing expressed or implied in this Instrument is intended or shall be construed to confer upon or give any person, other than the Parties hereto, any right or remedies under or by reason of this Instrument. |
| 14. | CONFIDENTIALITY |
| 14.1 | Each Party undertakes to keep confidential and at all times not disclose publicly or to any third party without the prior written consent of the other Party the existence and subject matter of this Instrument and all other agreements entered into pursuant to this Instrument, the substance of any negotiations between the Parties relating to this Instrument (and any such other agreements) and any other information received or obtained as a result of entering into this Instrument (and any such other agreements), unless and to the extent that: |
| (a) | the disclosure or use is required by law, any governmental or regulatory body or any recognised securities exchange on which the shares of any Party or its Affiliates are listed; |
| (b) | the disclosure or description of the contents of this Instrument is required by any stock exchange or regulator or counterparty in the de-SPAC Transaction, or is included in the Business Combination Agreement, offering circular, prospectus, registration statements and such other required materials, documents or announcement which may be issued by any Party or its Affiliates, in connection with the de-SPAC Transaction; |
| (c) | the disclosure is to each Party’s Affiliates, employees, legal counsel, auditor, insurer, accountant, consultant, officer, director, or advisor of the foregoing so long as it is on a need-to-know basis and such persons are under nondisclosure obligations which are at least as onerous as those contained in this Instrument; |
| (d) | the disclosure or use is required for the purpose of any judicial proceedings arising out of this Instrument or any other agreement entered into under or pursuant to this Instrument; |
| (e) | the information is or becomes publicly available (other than by breach of this Instrument); |
| (f) | the Party whose information is to be disclosed or used has, or all such Parties have, given prior written approval to the disclosure or use; or |
| (g) | the information is independently developed by the recipient without reference to the confidential information or is lawfully in its possession prior to the disclosure to it of the information, |
provided that, prior to disclosure of any information pursuant to Clause 14.1(a), the Party required to so disclose shall, where and to the extent not prohibited by such law or regulation, (x) consult with the other Party, (y) take into account the other Party’s reasonable requirements as to its timing, content and manner of making and (z) reasonably cooperate with such other Party’s seeking a protective order, confidential treatment or other appropriate remedy. If a Party is unable to consult with the other Party before the announcement, communication or circular or disclosure is made, it shall to the extent not prohibited by such law or regulation promptly inform the other Party of the circumstances, timing, content and manner of making of the announcement or disclosure promptly after such announcement or disclosure is made so that such other Party may seek a protective order, confidential treatment or other appropriate remedy. In the event of any disclosure pursuant to the foregoing, a disclosing Party shall furnish only that portion of the information that is legally required and shall exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such information.
| 14.2 | The obligations contained in this Clause 14 shall endure, even after the termination of this Instrument, without limit in point of time except and until any confidential information enters the public domain as set out above. |
11
| 15. | NOTICES |
| 15.1 | Any notice required or permitted by this Instrument will be deemed sufficient when sent by email to the relevant address listed on the signature page, or as subsequently modified by written notice received by the Company or the Warrantholder, as applicable. |
| 16. | COUNTERPARTS |
| 16.1 | This Instrument may be executed in any number of counterparts and by the Parties on separate counterparts, each of which, when so executed, shall be an original, but all counterparts shall together constitute one and the same document. Signatures may be exchanged by e-mail. Each party agrees to be bound by its own electronic signature and that it accepts the electronic signature of the other Party. |
| 17. | GOVERNING LAW |
| 17.1 | This Instrument, and all claims or causes of action based upon, arising out of, or related to this Instrument or the transactions contemplated hereby, shall be governed by, and construed in accordance with, the laws of the State of New York, without giving effect to principles or rules of conflict of laws to the extent such principles or rules would require or permit the application of laws of another jurisdiction. |
| 18. | DISPUTE RESOLUTION |
| 18.1 | Arbitration |
| (a) | Any dispute, claim, difference or controversy arising out of or relating to or having any connection with this Instrument, including any dispute as to its existence, validity, interpretation, performance, breach or termination or the consequences of its nullity and any dispute relating to any non-contractual obligations arising out of or in connection with it (“Dispute”), shall be referred to and finally resolved by arbitration under the International Chamber of Commerce (“ICC”) Rules of Arbitration in force at the time of filing the Claim, which rules are deemed to be incorporated by reference into this clause. |
| (b) | The number of arbitrators shall be three. Each Party shall nominate one arbitrator, and shall by agreement jointly nominate the third, presiding arbitrator. If a Party fails to nominate an arbitrator, or if the Parties fail to agree on the appointment of the third arbitrator, within thirty days of receipt of the first request to do so from the other Party, the appointment shall be made, upon request of a Party, by the ICC. |
| (c) | The seat, or legal place, of arbitration shall be New York, New York. |
| (d) | The language to be used in the arbitral proceedings shall be English. |
12
SCHEDULE I
Pro-forma cap table of the Company
13
IN WITNESS WHEREOF, the Parties hereto have executed this Instrument as of the date first written above.
| THE COMPANY | ||
|---|---|---|
| For and on behalf of | ||
| CSLM III HOLDINGS, LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
| Email: | ||
| THE WARRANTHOLDER | ||
| For and on behalf of | ||
| ALPHANEST HOLDINGS LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
| Email: | ||
14
Exhibit 10.9
This WARRANT INSTRUMENT (the “Instrument”) is dated _____________________.
PARTIES
| (1) | CSLM III HOLDINGS, LTD, an exempted company limited by shares incorporated under the laws of the Cayman Islands with its registered office at Ascentium (Cayman) Limited, 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands (the “Company”); and |
| (2) | NOBLE ELITE LTD., an exempt company organized and existing under the laws of the Cayman Islands whose registered office is at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands (the “Warrantholder”), |
(each a “Party” and collectively the “Parties”).
BACKGROUND
| (A) | FDG (as defined below) has created and issued the FDG Warrant (as defined below) to the Warrantholder on the terms set out therein. |
| (B) | FDG and the Warrantholder agree that the FDG Warrant will automatically terminate and expire upon the consummation of the de-SPAC Transaction (as defined below) and upon, and in consideration of, the execution and delivery by the Company of this Instrument, entitling the Warrantholder to subscribe for a number of Class A Ordinary Shares (as defined below) equal to the number of unsubscribed FDG Warrant Shares (as defined below) multiplied by the Exchange Ratio (as defined below). |
| (C) | In connection with the above, the Company has agreed to create and issue the Warrants (as defined below) entitling the Warrantholder to subscribe for the Warrant Shares (as defined below) on the terms set out in this Instrument. |
NOW, THEREFORE, for good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, the Parties agree as follows:
AGREED TERMS
| 1. | INTERPRETATION |
| 1.1 | The definitions and rules of interpretation set out in this Clause 1 shall apply to this Instrument. |
Acquisition Merger Effective Time: has the meaning given to it in the BCA as at the time it is executed.
Affiliate: means, with respect to an entity or a person, any other entity or person that such entity or person controls, is controlled by or is under common control with, or any of their respective legal successors. For the purposes of this definition, “control” means the possession, directly or indirectly, of the power to elect or dismiss a majority of the board of directors (or other governing body) or to direct or cause the direction of the management and policies of such party, entity or person, whether through ownership of voting securities or otherwise. Notwithstanding the foregoing, the Parties acknowledge and agree that (a) the name “HongShan”/“红杉” is commonly used to describe a variety of entities (collectively, the “HongShan Entities”) that are affiliated by ownership or operational relationship and engaged in a broad range of activities related to investing and/or securities trading and (b) notwithstanding any other provision of this Instrument to the contrary, this Instrument shall not be binding on, or restrict the activities of, except the Warrantholder, any (i) HongShan Entity primarily engaged in investment and trading in the secondary securities market; (ii) the ultimate beneficial owner of a HongShan Entity (or its general partner or ultimate general partner) who is a natural Person, and such Person’s relatives (including but without limitation, such Person’s spouse, parents, children, siblings, mother-in-law and father-in-law and brothers and sisters-in-law), (iii) any officer, director or employee of a HongShan Entity (or its general partner or ultimate general partner) and such Person’s relatives, and (iv) for the avoidance of doubt, any portfolio companies of any HongShan Entity and portfolio companies of any affiliated investment fund or investment vehicle of any HongShan Entity.
AML: has the meaning given in Clause 6.1(b)(i).
Alphanest: Alphanest Holdings Ltd, a company organized and existing under the laws of the United Arab Emirates with its registered office at Office 911 9th Floor, Addax Port Office Tower Tamouh Al Reem Island Abu Dhabi United Arab Emirates.
Alphanest Warrant: the warrant created and issued by the Company to Alphanest entitling Alphanest to subscribe for the Warrant Shares (as defined in the Alphanest Warrant and not as defined in this Instrument) (as may be amended, restated, supplemented and modified from time to time).
Articles: the amended and restated memorandum and articles of association of the Company as may be amended from time to time.
Authority: any nation, any political subdivision thereof, whether state or local, any international organization, and any agency, authority, instrumentality, judicial or administrative, regulatory body, law enforcement body, securities or futures exchange, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
BCA: the business combination agreement by and among the Company, FDG, SPAC and certain other parties thereto.
Business Day: a day (other than a Saturday, Sunday or public holiday in the PRC, the United States, Hong Kong SAR or the Cayman Islands) on which banks are generally open for business in the PRC, the United States, Hong Kong SAR and the Cayman Islands.
Class A Ordinary Shares: Class A ordinary shares of the Company, having the rights and subject to the restrictions set out in the Articles, each of which shall be entitled to one (1) vote at any general meeting of the Company or pursuant to unanimous written resolutions of shareholders of the Company.
Completion: the completion of any and each exercise of the Warrants.
Completion Date: any date on which Completion occurs.
Completion Payment: the Subscription Price.
consummation of the de-SPAC Transaction: the occurrence of the “Acquisition Merger Effective Time” as defined in the BCA as at the time it is executed.
SPAC: CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company limited by shares.
de-SPAC Transaction: the transactions contemplated by the BCA, or such other similar transaction pursuant to which the Company or any other entity owning the Company becomes listed on a recognized stock exchange.
Exchange Ratio: has meaning given to it in the BCA, as applied to all holders of preference shares of FDG.
Exercise Period: the period from the date on which Alphanest or any transferee, assignee or successor of Alphanest exercises part or all of the Alphanest Warrant, to the date that is ten (10) years after the date of the FDG Warrant.
Exercise Price: in respect of the Warrant Shares, the price per share equal to USD 0.001.
2
FDG: means FIRST DIGITAL GROUP LIMITED, a private company limited by shares incorporated in Gibraltar with company number 121963.
FDG Warrant: the warrant created and issued by FDG to the Warrantholder on October 6, 2026, entitling the Warrantholder to subscribe for the FDG Warrant Shares (as may be amended, restated, supplemented and modified from time to time).
FDG Warrant Shares: means 769,259 preference shares in the capital of FDG under the FDG Warrant, as may be adjusted pursuant to the FDG Warrant.
Group Companies: means the Company and each and any of its subsidiaries from time to time, including, for the avoidance of doubt, after giving effect to the closing of the de-SPAC Transaction, and “Group Company” means any one of them.
Hong Kong: the Hong Kong Special Administrative Region of the People’s Republic of China.
Issuer: means FD121 (BVI) LIMITED, a private company limited by shares incorporated in the British Virgin Islands with BVI company number 2181483 whose registered office is situated at Ritter House, Wickhams Cay II, PO Box 3170, Road Town, Tortola VG1110, British Virgin Islands.
KYC: has the meaning given in Clause 6.1(b)(i).
PRC: means the People’s Republic of China, but solely for the purposes of this Instrument, excluding Hong Kong, the Macau Special Administrative Region and the islands of Taiwan.
Rules: the rules or regulations of any clearing system, the rules, operating procedures or market practice of any relevant stock exchange or market, any statute, law, regulation, ordinance, rule, judgment, order, decree, permit, concession, grant, franchise, license, agreement (whether concluded voluntarily or involuntarily), directive, requirement of, or other governmental restriction or any similar binding form of decision of or determination by or with, or any binding interpretation or administration of any of the foregoing by or with, any Authority, whether now or hereafter in effect.
Securities: any or all of the following, wherever issued and whether voting or non-voting: (a) shares, stock or other equity interests in the Company (including any fraction of a share); (b) warrants, rights, options or other rights to subscribe for, purchase or otherwise acquire any shares in the Company; (c) any convertible, exchangeable or exercisable securities, notes, debentures, bonds or other instruments issued by the Company or any other person that are convertible into, exchangeable for, or exercisable for any shares or other equity interests in the Company; (d) any other security, instrument or right that directly or indirectly confers a right to acquire, receive or participate in any shares or other equity interests in the Company; and (e) any other securities of the Company that are from time to time treated as “securities” or “equity securities” under applicable law or the Company’s articles of association or equivalent constitutional documents.
Subscription Price: in relation to the exercise of the Warrants, the Exercise Price multiplied by the number of Subscription Shares.
Subscription Rights: has the meaning given in Clause 2.3.
Subscription Shares: in relation to any and each exercise of the Warrants, the number of Warrant Shares being subscribed for.
USD or US$: United States Dollars, the lawful currency of the United States of America.
Warrant: a warrant to subscribe for the Warrant Shares, on the terms and subject to the conditions of this Instrument.
Warrant Shares: means such number of Class A Ordinary Shares equal to the number of unsubscribed FDG Warrant Shares under the FDG Warrant multiplied by the Exchange Ratio.
3
| 1.2 | Clause and paragraph headings shall not affect the interpretation of this Instrument. |
| 1.3 | References to clauses are to the clauses of this Instrument. |
| 1.4 | A reference to this Instrument is a reference to this Instrument as varied or novated in accordance with its terms from time to time. |
| 1.5 | Unless the context otherwise requires, words in the singular shall include the plural and the plural shall include the singular. |
| 1.6 | Unless the context otherwise requires, a reference to one gender shall include a reference to the other genders. |
| 1.7 | A reference to writing or written includes fax and email. |
| 1.8 | Any words following the terms including, include, in particular, for example or any similar expression shall be construed as illustrative and shall not limit the sense of the words, description, definition, phrase or term preceding those words. |
| 1.9 | A reference to a statute or statutory provision is a reference to it as amended or re-enacted from time to time and shall include all subordinate legislation made from time to time under that statute or statutory provision. |
| 2. | CONSTITUTION, GRANT AND FORM OF WARRANTS |
| 2.1 | In consideration for the payment by the Warrantholder to the Company of US$1.00, the receipt of which is hereby acknowledged by the Company, the Company hereby constitutes, grants and issues the Warrants to the Warrantholder to subscribe for the Warrant Shares on the terms and subject to the conditions of this Instrument. |
| 2.2 | The Warrants shall be issued subject to the Articles and otherwise on the terms and subject to the conditions of this Instrument which are binding on the Company and the Warrantholder, and all persons claiming through or under them respectively. |
| 2.3 | The Warrants shall confer the right (but not the obligation) on the Warrantholder to subscribe in USD or stablecoins at the Subscription Price for the Warrant Shares on the terms and subject to the Articles and the conditions of this Instrument (the “Subscription Rights”). Nothing contained herein shall be construed as imposing any liabilities on the Warrantholder to acquire or subscribe for any securities (upon exercise of the Warrants or otherwise) or as a shareholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. |
| 2.4 | If the Company subdivides (by any subdivision, stock split, stock or share dividend, capitalization, recapitalization, reorganization, reclassification or otherwise) any Class A Ordinary Shares into a greater number of shares or consolidated (by any consolidation, reverse stock split, capitalization, recapitalization, reorganization, reclassification or otherwise) any Class A Ordinary Shares into a smaller number of shares, then, after the date of record for effecting such subdivision or consolidation, the number of Class A Ordinary Shares issuable upon exercise of this Warrant shall be proportionally increased (in the case of a subdivision) or decreased (in the case of a consolidation) so that the percentage of Warrant Shares, after the subdivision or consolidation, of the total number of Class A Ordinary Shares outstanding will be equal to the percentage of Warrant Shares, immediately prior to such subdivision or consolidation, of the total number of Class A Ordinary Shares outstanding immediately prior to such subdivision or consolidation. In addition, the Exercise Price shall be proportionally decreased (in the case of a subdivision) or increased (in the case of a consolidation) to appropriately reflect such subdivision or consolidation. |
| 3. | REGISTER AND CERTIFICATES |
| 3.1 | The Company shall not be obliged to issue any certificate representing the Warrants but shall, in accordance with the laws of the Cayman Islands and the Articles (if applicable), maintain a register of warrants and warrant holders. |
4
| 3.2 | The Company shall cause the Warrant Shares to be included in any stock exchange listing and registration rights agreement in connection with the de-SPAC Transaction, provided that the Warrantholder shall enter into the Registration Rights Agreement (as defined in the BCA) in connection with the consummation of the de-SPAC Transaction. |
| 4. | EXERCISE AND LAPSE OF SUBSCRIPTION RIGHTS |
| 4.1 | Subject to Clause 4.3 below, the Warrantholder may exercise its Subscription Rights in accordance with this Instrument at any time during the Exercise Period. |
| 4.2 | The Warrantholder may exercise its Subscription Rights in whole or in part on a single occasion or on multiple occasions by written notice to the Company given in accordance with Clause 15. Such notice shall state that number of Subscription Shares the Warrantholder intends to subscribe for, provided that such number, when added to the aggregate number of Subscription Shares already subscribed for in all previous exercises of the Warrantholder’s Subscription Rights, shall not exceed the total number of Warrant Shares. If the Warrantholder does not exercise its Subscription Rights in their entirety, the Warrantholder will be entitled to receive from the Company within a reasonable time after the date of any such partial exercise in accordance with the terms hereof, and in any event not exceeding three Business Days after the date thereof, a new warrant instrument in substantially identical form for the subscription of that number of Warrant Shares equal to the difference between the number of Warrant Shares subject to this Instrument and the number of Warrant Shares as to which the Warrantholder exercises its Subscription Rights. |
| 4.3 | Any Subscription Rights not exercised before the expiry of the Exercise Period shall automatically lapse and cease to be exercisable. |
| 4.4 | The Warrantholder (and not the Company) has the right in its sole discretion to terminate this Instrument immediately upon written notice to the Company before it exercises its Subscription Rights (in whole or in part). |
| 5. | COMPLETION |
| 5.1 | Completion shall take place within fifteen Business Days after each date on which the Warrantholder exercises its Subscription Rights in accordance with Clause 4.2, at such time and place as the Parties may agree. The Warrantholder shall use its reasonable efforts to cooperate with the Company to comply with all AML and KYC requirements of the Company, its registered agent, registered office, registrar and transfer agent or any regulator or stock exchange prior to and after the Completion Date, including but not limited to providing without undue delay such due diligence information and documents in respect of the Warrantholder that the Company, its registered agent, registered office, registrar and transfer agent or any regulator or stock exchange may reasonably request. |
| 5.2 | At Completion, the Warrantholder shall remit the Completion Payment to the Company by way of USD or stablecoins (at the sole discretion of the Warrantholder) and shall give instructions to remit the Completion Payment to the Company’s bank account or shall remit the Completion Payment to the Company’s crypto wallet, as the case may be; provided that if the Warrantholder has opted for payment by way of stablecoins, any such stablecoin must be either (i) issued by the Issuer; (ii) be one of USDT, USDC, FDUSD, U, or otherwise on the list of acceptable stablecoins as identified by the Company from time to time; or (iii) otherwise agreed to between the Company and the Warrantholder. Payment of the Completion Payment shall be made to (as applicable) such wallet address or bank account designated by the Company and notified to the Warrantholder in writing not later than five Business Days after the giving of the written notice referred to in Clause 4.2. The Warrantholder will provide the Company with proof of such remittance. For the avoidance of doubt, the Company may not actually receive the Completion Payment on its bank account and crypto wallet (as the case may be) on the Completion Date. |
5
| 5.3 | At Completion, the Company shall, on the same Business Day that such proof is delivered to it (or where such proof is delivered to the Company after 4pm Hong Kong SAR time on a Business Day or on a day that is not a Business Day, on the next Business Day after such delivery) cause a meeting of the directors of the Company to be duly convened and held or written resolutions of the directors of the Company to be passed in accordance with the Articles pursuant to which the following resolutions shall be passed to (save to the extent such resolutions have already been passed): |
| (a) | allot and issue to the Warrantholder (or to such other person as the Warrantholder may direct) the Warrant Shares; |
| (b) | enter the Warrantholder (or such other person as the Warrantholder may direct, as applicable) in the Company’s register of members as the holder of the number of Warrant Shares issued to it; |
| (c) | if requested by the Warrantholder or otherwise required pursuant to applicable law, deliver to the Warrantholder (or such other person as the Warrantholder may direct, as applicable) a copy of a duly executed share certificate for the number of Warrant Shares issued to it; and |
| (d) | make all necessary filings with the Registrar of Companies in the Cayman Islands, |
and shall ensure that the actions in (a) to (d) are completed on said same Business Day.
| 5.4 | The Warrant Shares issued under Clause 5.3(a) shall: |
| (a) | be duly and validly issued, fully paid and non-assessable; |
| (b) | rank pari passu and form one class with the other fully paid shares of the same classes then in issue, subject to the Articles; and |
| (c) | entitle the registered holder to receive any dividend or other distribution announced or declared in accordance with the Articles on or after the relevant Completion Date. |
| 5.5 | No fractions of a Warrant Share shall be allotted or issued on the exercise of any Subscription Rights and no refund will be made to the Warrantholder exercising such Subscription Rights. If the exercise of any Subscription Rights would require a fraction of a Warrant Share to be allotted, the aggregate number of Warrant Shares so allotted to a Warrantholder will be rounded down to the nearest whole Warrant Share. |
| 6. | TRANSFER OF WARRANTS |
| 6.1 | To the extent permitted by applicable Rules, the Warrants shall be freely transferable by the Warrantholder by means of an instrument of transfer in any usual form: |
| (a) | to any Affiliate of the Warrantholder, without requiring the prior consent of the Company; and |
| (b) | to any other person, with the prior written consent of the Company, provided that: |
| (i) | the Warrantholder shall provide written notice to the Company prior to any such transfer, including the name of the proposed transferee and such other information as the Company may reasonably request including any information for the purposes of completing anti-money laundering (“AML”) and “know your customer” (“KYC”) checks by the Company as required by applicable Rules; and |
6
| (ii) | such consent shall not be withheld unless the Company is able to reasonably demonstrate that such transfer would have an adverse impact on the status of any licence held by the Company or its Affiliates which is necessary for the operation of its business, the general regulatory status of the Company, its Affiliates and the stablecoins issued by the Issuer, and/or the relationships between the Company, its Affiliates and any person providing banking services to the Company or its Affiliates; |
provided, however, any transfer under Clause 6.1(a) or 6.1(b) shall be subject to the satisfactory completion of AML and KYC checks by the Company as required by applicable Rules, and the Warrantholder shall not exercise, convert, transfer, assign or otherwise realise upon the Warrants until the Exercise Period has commenced.
| 6.2 | An instrument of transfer shall be made under hand and executed by or on behalf of the transferor but need not be signed by the transferee. |
| 7. | COMPANY REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS |
| 7.1 | The Company represents and warrants to the Warrantholder that, as at the date hereof (after giving effect to the closing of the de-SPAC Transaction) and each Completion Date (except that (i) a warranty which is expressly specified to be given on a particular date is made only on such date and (ii) the warranties in 7.1(p) to 7.1(t) are made on the date hereof and as at consummation of the de-SPAC Transaction), in each case except for any matter that has been publicly disclosed in any report, document or filing filed with or furnished to the SEC by the Company or the SPAC prior to the date on which each representation and warranty is being given: |
Share Capital
| (a) | Each Group Company is duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organisation and has all requisite corporate power and authority to own its properties and assets and to carry on its business as now conducted and as presently proposed to be conducted; |
| (b) | The Warrant Shares, when issued, sold and allotted in accordance with the terms of this Instrument and the Articles for the consideration expressed herein, (i) will be duly and validly issued, fully paid and non-assessable, (ii) will be free of encumbrances and restrictions on transfer other than those expressly provided herein or as imposed thereon pursuant to applicable law or the Articles, and (iii) will have the rights, powers and preferences (if any) of the Class A Ordinary Shares as provided in the Articles. |
| (c) | There is no encumbrance, and there is no agreement, arrangement or obligation to create or give any encumbrance, in relation to any of the Warrant Shares. |
| (d) | The shares in each Group Company have been validly authorised, allotted and issued and fully paid-up. |
Capacity, Authority, and Insolvency
| (e) | The Company has the full power and authority to execute this Instrument and to exercise its right and perform its obligations hereunder. |
| (f) | The execution of this Instrument and the subscription for and issuance of the Subscription Shares are not in breach of any applicable Rules. |
| (g) | This Instrument has been duly authorized, executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. |
7
| (h) | The execution, delivery and performance of this Instrument shall not result in a breach of any of the terms or provisions of, or constitute a default under, any applicable Rules or to be in conflict with any agreement or arrangement to which the Company is a party. |
| (i) | No Group Company is insolvent or unable to pay its debts as they fall due. |
Schedule I
| (p) | Schedule I sets out a true, complete, accurate and not misleading list of, as at the consummation of the de-SPAC Transaction, the Company’s allotted and issued share capital on a fully diluted and as-converted basis, provided that the assumptions set forth in the “Assumptions” section in Schedule I are accurate. |
| (q) | The Company has not and will not, between the date of the BCA and the consummation of the de-SPAC Transaction (both dates included), issue any new Securities which are not contemplated or included in Schedule I, save for any Securities issued pursuant to the Transaction Financing (as defined in the BCA as at the time it is executed). |
Lock-up
| (r) | All directors, officers and shareholders of more than 5% or more of the voting equity securities of the Company as at the consummation of the de-SPAC Transaction will enter into the Lock-up Agreement (as defined in the BCA as at the time it is executed) on or before the consummation of the de-SPAC Transaction. |
Earn-out
| (s) | As at the consummation of the de-SPAC Transaction (both dates included), (i) the Sponsor Share Restructuring Agreement (as defined in the BCA) shall have been executed in accordance with Section 8.11 of the BCA, (ii) the earn-out conditions and schedule in the Sponsor Share Restructuring Agreement (as defined in the BCA) shall correspond in all material respects to Section 8.11 and Schedule 1 of the BCA (as at the time it is executed) and shall not have been amended, and (iii) the maximum number of shares issuable under the Sponsor Share Restructuring Agreement (as defined in the BCA) shall not have been amended. |
| (t) | Between the date of the BCA and the consummation of the de-SPAC Transaction (both dates included), there has not been any amendment to any agreement the Company is party to which has the effect of amending the maximum number of shares or warrants issuable or warrant exercise price under such agreement or any equity-related earn-out schedule or condition or other share vesting schedule or condition, or causing the Company to issue any securities earlier than originally agreed, nor has the Company agreed to any such amendment. |
| 7.2 | The Company undertakes to cooperate fully with the Warrantholder in connection with the exercise of Subscription Rights, including without limitation by providing promptly such due diligence information in respect of the Company that the Warrantholder may reasonably request and by assisting with any engagement that may be required with shareholders of the Company. The Company shall notify the Warrantholder in writing within five (5) Business Days after Alphanest or any transferee, assignee or successor of Alphanest exercises part or all of the Alphanest Warrant. |
| 7.3 | The Company undertakes to at all times reserve and keep available, out of its authorized but unissued Class A Ordinary Shares, solely for the purpose of providing for the exercise of this Warrant, the aggregate number of Warrant Shares then issuable upon exercise of this Warrant at any time. The Company shall take all such commercially reasonable action as may be necessary to ensure that the Warrant Shares may be issued without violation of any applicable law or regulation or of any requirement of any securities exchange on which the Warrant Shares are then listed or traded. The Company will upon the request of the Warrantholder acknowledge in writing its continuing obligation to afford to the Warrantholder all rights to which the Warrantholder is entitled after such exercise in accordance with the terms of this Warrant. |
8
| 7.4 | To the extent that any amendment, modification or waiver of the Alphanest Warrant would adversely affect the rights of the Warrantholder under this Instrument, the Company shall notify the Warrantholder in writing within five (5) Business Days and amend this Instrument in a manner reasonably acceptable to the Warrantholder so as to preserve for the Warrantholder rights and benefits that are, in the aggregate, no less favorable than those provided under this Instrument immediately prior to such amendment, modification or waiver. Furthermore, the Company shall not agree to any acceleration of the commencement of the Exercise Period (as defined in the Alphanest Warrant and not as defined in this Instrument) under the Alphanest Warrant without the prior written consent of the Warrantholder. |
| 7.5 | Compliance related Representations and Warranties: |
| (a) | None of the Group Companies, is aware of or has taken any action, directly or indirectly, that would result in a violation of or has violated the People’s Republic of China (“PRC”) Criminal Law, the PRC Anti-Unfair Competition Law, the Provisional Regulations regarding Prohibition of Commercial Bribery and all other applicable laws, regulations and judicial interpretations in respect of anti-corruption in the PRC (collectively referred to as “PRC Anti-Corruption Laws”), the U.S. Foreign Corrupt Practices Act (“FCPA”), as amended, the U.K. Bribery Act (“UKBA”), as amended, or any other applicable anti-bribery or anti-corruption laws. In particular, no Group Company is aware of or has offered, paid, promised to pay, or authorized the payment of any money or the giving of anything of value, to any officer, employee, or any other person acting in an official capacity for any government, political party or any department, agency or instrumentality thereof, including any entity or enterprise owned or controlled by a government, or a public international organization (“Government Entity”) (any officer, employee, or any other person acting on behalf of Government Entity is individually and collectively referred to as “Government Official”), for the purpose of: (i) influencing any act or decision of such Government Official in his official capacity; (ii) inducing such Government Official to do or omit to do any act in relation to his lawful duty; (iii) securing any improper advantage; or (iv) inducing such Government Official to influence or affect any act or decision of any Government Entity. |
| (b) | No Group Company is, or is owned or controlled by, a Sanctioned Party. |
| (c) | The Group Companies are, and have been, in compliance with all applicable Anti-Money Laundering Laws and Sanctions. |
| (d) | No Group Company has engaged in, nor is now engaged in, any dealings or transactions with or for the benefit of any Sanctioned Party. |
| (e) | No Group Company is or has been the subject of any actual or threatened investigation, inquiry, or enforcement proceedings related to potential violations of Anti-Money Laundering Laws or Sanctions. |
| (f) | No Group Company is aware of or has taken action, directly or indirectly, that would result in a violation of or has violated the Export Administration Regulations administered by the U.S. Bureau of Industry and Security. |
| (g) | The Group Companies shall comply with all applicable Anti-Money Laundering Laws and Sanctions. |
| (h) | No Group Company shall engage in any dealings or transactions with or for the benefit of any Sanctioned Party. |
| (i) | No Group Company shall take (or fail to take) any action that causes, or foreseeably may cause, the Warrantholder, its affiliates, or their respective personnel (1) to be in violation of applicable Sanctions; or (2) to become the target of Sanctions. |
| (j) | The Group Companies have established (or will establish, as the case may be), and shall maintain and adhere to, an anti-money laundering and sanctions compliance program that (1) meets the requirements of all applicable Anti-Money Laundering Laws and Sanctions (whether existing or enacted in the future); and (2) includes, at minimum, the following elements: a dedicated anti-money laundering compliance officer who is a member of the board or senior management, risk-based due diligence procedures (including restricted party screening), training for relevant personnel, independent testing, a system of internal controls reasonably designed to ensure ongoing compliance, ongoing monitoring to detect unusual or suspicious transactions, and procedures for detecting and reporting suspicious transactions or activities. |
9
| (k) | The Company shall immediately notify the Warrantholder if it knows, or has reason to suspect, that any of the representations or warranties in this Clause 7.5 is no longer accurate. |
| (l) | The Company shall indemnify the Warrantholder and its affiliates for any fines, penalties and other costs, damages, claims or liabilities arising from any violation of any of the representations and warranties in this Clause 7.5, the Sanctions, or the Export Administration Regulations. |
| 7.6 | The Company shall not -- and shall not permit any Group Company to – offer, pay, promise to pay, or authorize the payment of any money or the giving of anything of value, directly or indirectly, to any Person in violation of the PRC Criminal Law, the PRC Anti-Unfair Competition Law, the Provisional Regulations regarding Prohibition of Commercial Bribery and all other PRC Anti-Corruption Laws, the FCPA, as amended, the UKBA, as amended, or any other applicable anti-bribery or anti-corruption law. The Company further represents that it shall -- and shall cause each Group Company to -- cease all of its or their respective activities, as well as remediate any actions taken by any Group Company in violation of the PRC Anti-Corruption Laws, FCPA, the UKBA, or any other applicable anti-bribery or anti-corruption law. The Company further represents that it shall -- and shall cause each Group Company to -- maintain systems of internal controls (including, but not limited to, accounting systems, purchasing systems and billing systems) to ensure compliance with the PRC Anti-Corruption Laws, FCPA, the UKBA, or any other applicable anti-bribery or anti-corruption law. |
For the purposes of these Clauses 7.5 and 7.6:
“Anti-Money Laundering Laws” means laws, regulations, rules, or guidelines relating to money laundering, the proceeds of criminal activity, terrorist financing, or financial recordkeeping or reporting requirements, including without limitation (1) the EU Anti-Money Laundering Directives and any laws, decrees, administrative orders, circulars, or instructions implementing or interpreting the same; (2) the UK Proceeds of Crime Act; (3) the applicable requirements of the U.S. Bank Secrecy Act, USA Patriot Act, and the U.S. Currency and Foreign Transaction Reporting Act of 1970; and (4) other similar laws applicable to the Group Companies, or their respective operations from time to time.
“Sanctioned Party” means a Person that is (1) the subject of Sanctions; (2) ordinarily resident in, located in, or organized under the laws of a country or territory that has been the subject of country- or territory-wide Sanctions in the last five years (including without limitation Cuba, Iran, North Korea, Sudan, Syria, or the Crimea region); or (3) majority-owned or controlled by any of the foregoing.
“Sanctions” means trade, economic and financial sanctions laws, regulations, embargoes, and restrictive measures (in each case having the force of law) administered, enacted or enforced from time to time by (1) the United States (including without limitation the Department of the Treasury’s Office of Foreign Assets Control); (2) the European Union and enforced by its member states; (3) the United Nations; (4) Her Majesty’s Treasury; or (5) other similar governmental entities with regulatory authority over the Group Companies, or their respective operations from time to time.
| 7.7 | The Company undertakes to at all times not make without the Warrantholder’s prior written consent (a) any amendment to any agreement the Company is party to as at the consummation of the de-SPAC Transaction which has the effect of amending the maximum number of shares or warrants issuable or warrant exercise price under such agreement or any equity-related earn-out schedule or condition or other share vesting schedule or condition, or causing the Company to issue any securities earlier than originally agreed, nor agree to any such amendment or (b) any amendment to a Lock-up Agreement (as defined in the BCA as at the time it is executed) with any director, officer or shareholder of more than 5% or more of the voting equity securities of PubCo as at the consummation of the de-SPAC Transaction, nor agree to any such amendment. |
10
| 8. | VARIATION |
| 8.1 | No variation or abrogation of the terms of this Instrument or of all or any of the rights for the time being attached to the Warrants shall be effective (whether or not the Company is being wound up) without each other Party’s written consent. |
| 9. | ENTIRE AGREEMENT |
| 9.1 | This Instrument and the other Transaction Documents (as such term is defined in the Share Transfer Agreement between Vincent Chok and the Warrantholder dated 6 October 2026) constitutes the entire agreement between the Parties and supersedes and extinguishes all previous discussions, correspondence, negotiations, drafts, agreements, promises, assurances, warranties, representations, arrangements and understandings between them, whether written or oral, relating to the subject matter hereof. |
| 9.2 | Each Party: |
| (a) | acknowledges that, in agreeing to enter into this Instrument, it has not relied on any express or implied representation, warranty, collateral contract or other assurance made by or on behalf of each other Party before entering into this Instrument; and |
| (b) | waives all rights and remedies which, but for this Clause 9.2 might otherwise be available to it in respect of any such express or implied representation, warranty, collateral contract or other assurance. |
| 10. | FURTHER ASSURANCE |
| 10.1 | At its own expense, each Party shall, and shall use all reasonable endeavours to procure that any necessary third party shall, promptly execute and deliver such documents and perform such acts as the other Party may reasonably require for the purpose of giving full effect to this Instrument. |
| 11. | ASSIGNMENT |
| 11.1 | The Company may not assign any of its rights or obligations under this Instrument without the prior written consent of the Warrantholder, such consent shall not be unreasonably withheld or delayed if the proposed assignment is to an Affiliate of the Company. Any unauthorised assignment or transfer will be void and of no force or effect. |
| 12. | SEVERANCE |
| 12.1 | If any provision of this Instrument or part-provision of this Instrument is or becomes invalid, unenforceable or illegal, it shall be deemed modified to the minimum extent necessary to make it valid, legal and enforceable. If such modification is not possible, the relevant provision or part-provision shall be deemed deleted. Any modification to or deletion of a provision or part-provision under this clause shall not affect the validity and enforceability of the rest of this Instrument. If one Party gives notice to the other of the possibility that any provision or part-provision of this Instrument is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to amend such provision so that, as amended, it is legal, valid and enforceable, and, to the greatest extent possible, achieves the intended commercial result of the original provision. |
| 13. | THIRD PARTY RIGHTS |
| 13.1 | This Instrument does not confer any rights on any person or party (other than the Parties) under the Contracts (Rights of Third Parties) Ordinance (Chapter 623 of the Laws of Hong Kong) to enforce or enjoy the benefit of any term of this Instrument. Notwithstanding any term herein, the consent of any person who is not a party to this Instrument is not required to rescind or vary this Instrument at any time. |
11
| 14. | CONFIDENTIALITY |
| 14.1 | Each Party undertakes to keep confidential and at all times not disclose publicly or to any third party without the prior written consent of the other Party the existence and subject matter of this Instrument and all other agreements entered into pursuant to this Instrument, the substance of any negotiations between the Parties relating to this Instrument (and any such other agreements) and any other information received or obtained as a result of entering into this Instrument (and any such other agreements), unless and to the extent that: |
| (a) | the disclosure or use is required by law, any governmental or regulatory body or any recognised securities exchange on which the shares of any Party or its Affiliates are listed; |
| (b) | the disclosure or description of the contents of this Instrument is required by any stock exchange or regulator or counterparty in the de-SPAC Transaction, or is included in the BCA, offering circular, prospectus, registration statements and such other required materials, documents or announcement which may be issued by any Party or its Affiliates, in connection with the de-SPAC Transaction, in each case pursuant to the applicable laws and rules, provided that, to the extent reasonably practicable and permitted by applicable laws and rules, the Warrantholder shall be given a reasonable opportunity to review and comment on any such disclosure relating to the Warrantholder or the Transaction Documents prior to such disclosure, and the Company and the Warrantholder shall incorporate any reasonable comments of the Warrantholder; |
| (c) | the disclosure is to each Party’s Affiliates, employees, legal counsel, auditor, insurer, lender, prospective investor, prospective buyer, accountant, consultant, officer, director, or advisor of the foregoing so long as it is on a need-to-know basis and such persons are under nondisclosure obligations which are at least as onerous as those contained in this Instrument; |
| (d) | the disclosure or use is required for the purpose of any judicial proceedings arising out of this Instrument or any other agreement entered into under or pursuant to this Instrument; |
| (e) | the information is or becomes publicly available (other than by breach of this Instrument); |
| (f) | the Party whose information is to be disclosed or used has, or all such Parties have, given prior written approval to the disclosure or use; or |
| (g) | the information is independently developed by the recipient without reference to the confidential information or is lawfully in its possession prior to the disclosure to it of the information, |
provided that, prior to disclosure of any information pursuant to Clause 14.1(a), the Party required to so disclose shall, where and to the extent not prohibited by such law or regulation, (x) consult with the other Party, (y) take into account the other Party’s reasonable requirements as to its timing, content and manner of making and (z) reasonably cooperate with such other Party’s seeking a protective order, confidential treatment or other appropriate remedy. If a Party is unable to consult with the other Party before the announcement, communication or circular or disclosure is made, it shall to the extent not prohibited by such law or regulation promptly inform the other Party of the circumstances, timing, content and manner of making of the announcement or disclosure promptly after such announcement or disclosure is made so that such other Party may seek a protective order, confidential treatment or other appropriate remedy. In the event of any disclosure pursuant to the foregoing, a disclosing Party shall furnish only that portion of the information that is legally required and shall exercise reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such information.
| 14.2 | The obligations contained in this Clause 14 shall endure, even after the termination of this Instrument, without limit in point of time except and until any confidential information enters the public domain as set out above. |
| 14.3 | Without the prior written consent of the Warrantholder, the Parties hereto (excluding the Warrantholder) shall not use any name, mark, brand or logo of Sequoia, HongShan or its Affiliate (which include but are not limited to “Sequoia”, “Hongshan”, “红杉”, “红杉中国” or any name, mark or logo that is confusingly similar to or contains any of the foregoing), claim itself as a partner of Sequoia, HongShan or its Affiliate, or make any similar representation. |
12
| 15. | NOTICES |
| 15.1 | Any notice required or permitted by this Instrument will be deemed sufficient when sent by email to the relevant address listed on the signature page, or as subsequently modified by written notice received by the Company or the Warrantholder, as applicable. |
| 16. | COUNTERPARTS |
| 16.1 | This Instrument may be executed in any number of counterparts and by the Parties on separate counterparts, each of which, when so executed, shall be an original, but all counterparts shall together constitute one and the same document. Signatures may be exchanged by e-mail. Each party agrees to be bound by its own electronic signature and that it accepts the electronic signature of the other Party. |
| 17. | GOVERNING LAW |
| 17.1 | This Instrument shall be governed by and construed in accordance with the laws of Hong Kong, without giving effect to any choice or conflict of law provision or rule (whether of Hong Kong or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of Hong Kong. |
| 18. | DISPUTE RESOLUTION |
| 18.1 | Any dispute, controversy, difference or claim arising out of or relating to this Instrument, including the existence, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to it shall be referred to and finally resolved by arbitration administered by the Hong Kong International Arbitration Centre (HKIAC) under the HKIAC Administered Arbitration Rules in force when the notice of arbitration is submitted. The law of this arbitration clause shall be Hong Kong law. The seat of arbitration shall be Hong Kong. The number of arbitrators shall be one. The arbitration proceedings shall be conducted in English. |
| 18.2 | Notwithstanding the submission of any claim or dispute pursuant to this Clause 18 (if any), the Parties shall continue to exercise their remaining respective rights, and fulfil their remaining respective obligations under this Instrument, except insofar as it/they relate(s) directly to those matters in dispute. |
13
SCHEDULE I
Pro-forma cap table of the Company
14
IN WITNESS WHEREOF, the Parties hereto have executed this Instrument as of the date first written above.
| THE COMPANY | ||
|---|---|---|
| For and on behalf of | ||
| CSLM III HOLDINGS, LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
| Email: | ||
| THE WARRANTHOLDER | ||
| For and on behalf of | ||
| NOBLE ELITE LTD. | ||
| By: | ||
| Name: | ||
| Title: | ||
| Email: | ||
15
Exhibit 99.1
First
Digital Signs Definitive Agreement to Become a Publicly Listed Company to
Build the Infrastructure for the Agentic Economy
First Digital, the group behind FDUSD, which has recorded more than $4 trillion in cumulative trading volume, has entered into a definitive business combination agreement with CSLM Digital Asset Acquisition Corp III valuing First Digital at $250 million on a pre-money equity basis; on closing, the post-combined company is expected to become a Nasdaq-listed company
Transaction Highlights
| ● | First Digital is the group behind FDUSD, a USD-referenced stablecoin launched in 2023 that has recorded more than $4.7 trillion in cumulative trading volume (as of June 30, 2026) and a historical peak circulation of more than $4.4 billion (reached in April 2024) |
| ● | Every FDUSD is backed by cash and cash equivalents, including short-dated US Treasury bills and reverse repurchase agreements, held with a licensed custodian in segregated client accounts, with monthly attestations by an independent accounting firm |
| ● | First Digital generated approximately $87 million in revenue in the fiscal year ended June 30, 2025 |
| ● | Finance District, an on-chain ecosystem for the agentic economy developed by First Digital, is live with four products: District Pass, Agent Wallet, Prism and an AI assistant |
| ● | The Proposed Transaction values First Digital at $250 million on a pre-money equity basis; on closing, the post-combined company is expected to become a Nasdaq-listed company |
| ● | Closing is expected in the first half of 2027, subject to shareholder and regulatory approvals and customary closing conditions |
HONG KONG SAR and NEW YORK, October 6, 2026 /PRNewswire/ — First Digital Group Limited (together with its subsidiaries, “First Digital”) has signed a definitive business combination agreement (the “BCA”) with CSLM Digital Asset Acquisition Corp III, Ltd. (Nasdaq: KOYN) (“KOYN”). First Digital is the group behind the FDUSD stablecoin and the developer of Finance District. KOYN is a special purpose acquisition company, or SPAC, listed on Nasdaq.
Upon the closing of the transactions contemplated by the BCA (the “Proposed Transaction”), First Digital would become a wholly owned subsidiary of a new holding company formed in the Cayman Islands (the “Listed Company”). The Listed Company’s shares are expected to trade on The Nasdaq Stock Market LLC (“Nasdaq”). The closing of the Proposed Transaction is subject to regulatory approval, approval by the shareholders of KOYN and First Digital, and the satisfaction of certain other customary closing conditions.
First Digital is pursuing a listing for three reasons. A listing would give it access to public capital markets to fund the continued build-out of Finance District. It would also bring the transparency and reporting obligations of a listed company. First Digital expects those to matter to the institutions, partners and regulators it works with. And it would let public-market investors take part in what First Digital is building.
FDUSD
First Digital launched FDUSD in 2023. Its early adoption came through Binance, one of the world’s largest digital-asset exchanges, which listed FDUSD trading pairs and integrated it across a range of trading and product offerings; Binance remains the largest centralised secondary market for FDUSD. FDUSD reached $1 billion in market capitalisation within four months of launch. As of June 30, 2026, FDUSD had recorded more than $4 trillion in cumulative trading volume, a single-day trading-volume high of approximately $25 billion and a peak circulation of more than $4.4 billion (reached in April 2024) and traded in more than 100 pairs across 16 exchanges on six blockchain networks, including Ethereum, BNB Smart Chain, Solana, Sui Arbitrum and TON.
FDUSD is issued by a First Digital group company. Every FDUSD in circulation is backed by reserves of cash and cash equivalents, including short-dated US Treasury bills, held for the issuer by First Digital Trust Limited (“FDT”), a Hong Kong-licensed trust or company service provider and a First Digital group company, as custodian, in segregated accounts. Reserves are subject to independent monthly attestations. FDUSD does not pay interest or yield.
First Digital is extending the range of venues and applications in which FDUSD is used for settlement on two fronts: across centralised exchanges, decentralised exchanges and DeFi platforms; and within Finance District, the ecosystem developed by First Digital, in which FDUSD is the primary settlement asset.
South Korea, one of the world’s most active digital-asset markets, is a strategic priority for First Digital as the country develops its digital-asset and stablecoin framework. First Digital has signed memoranda of understanding with a subsidiary of the ITCEN Group, a KOSDAQ-listed Korean IT and digital-asset group, and with Wavebridge Inc., a virtual asset service provider registered with the Korea Financial Intelligence Unit (KoFIU), to explore distribution and settlement infrastructure for FDUSD in Korea and to share First Digital’s stablecoin issuance experience with Korean institutions. First Digital does not intend to issue a won-referenced stablecoin itself. Vincent Chok, First Digital’s Founder and Chief Executive Officer, has participated in industry and policy discussions on stablecoins in Korea, including at the National Assembly in May 2026. First Digital plans to open a branch office in Korea in the first quarter of 2027, subject to business, regulatory and operational considerations.
Finance District and the Agentic Economy
Finance District (fd.xyz) is an ecosystem for the agentic economy developed by First Digital: financial infrastructure for people and for the AI agents acting on their behalf. Four products are live today. District Pass is the single identity credential used across the ecosystem. Agent Wallet is a multi-chain wallet that AI agents operate through the Model Context Protocol (MCP), with a graphical interface for the people they act for. Prism is tooling that allows merchants and e-commerce platforms to accept digital-asset payments, including stablecoins, from their customers and from AI agents purchasing on their behalf. An AI assistant helps users transact and manage their activity across the platform.
Third-party projections indicate the scale of the opportunity: Edgar, Dunn & Company projects global agentic consumer-to-business spend of $136 billion in 2025, growing to $1.7 trillion by 2030, and Standard Chartered forecasts global stablecoin supply of approximately $2 trillion by 2028. The agentic economy is at an early stage, and Finance District does not yet contribute material revenue to First Digital; it is being built to provide the infrastructure that this economy will require.
Finance District is designed to be governed by holders of FDFI, a governance token with a fixed supply of two billion tokens. Supporters of the ecosystem include Moca Services Limited (Animoca Brands) and Wintermute Trading Ltd (Wintermute) FDFI is a governance token and does not represent any equity, ownership or other interest in First Digital or FDUSD.
Page 2
Founder-Led Since 2019
Vincent Chok founded First Digital in 2019 as a trust and custody services business. In 2022 the group incorporated First Digital Group Limited in Gibraltar as its holding company, and in 2023 it launched FDUSD. First Digital today has more than 75 employees across multiple jurisdictions, and its senior team combines experience in digital assets, regulatory compliance, financial operations and technology infrastructure. First Digital currently holds a Trust or Company Service Provider (TCSP) licence in Hong Kong and two Money Services Business (MSB) registrations in Canada. It has a licence application pending with the Abu Dhabi Global Market (ADGM) for the issuance of fiat-referenced tokens, and intends to seek authorisations in Europe, the United Arab Emirates, Southeast Asia, Latin America and the United States
Today’s announcement is the next step: a definitive business combination agreement to take the company public to build the infrastructure for the agentic economy.
Management Commentary
Vincent Chok, Founder and Chief Executive Officer of First Digital, said: “First Digital was built by taking one thing at a time and getting it right. We launched FDUSD in 2023, and it has become one of the most actively traded stablecoins on centralised exchanges, fully backed by reserves that are attested every month. The next thing is Finance District: which we believe provides the infrastructure that people and their AI agents will need as commerce becomes agentic. We are at the beginning of that industry. A Nasdaq listing would give us access to public capital markets, the transparency of a listed company, and shareholders who can participate in building it with us.”
Vik Mittal, Chairman & Chief Executive Officer of KOYN, said: “We are honored to partner with a visionary of Vincent’s standing. Custody, integrity, and trust, these foundational principles define First Digital’s approach. Programmable money collapses the world’s payment networks into one global dollar network. We’re finally rewriting the world’s financial rails from scratch. The emergence of agentic payments represents a paradigm shift, and First Digital is uniquely positioned to lead this transformation with FDUSD as the native settlement asset within Finance District.”
Black Spade Advisory, strategic advisor to First Digital, added: “We are supportive of innovative developments in the digital asset sector and note the potential significance of the proposed business combination. This transaction could help advance the market presence of stablecoin-related infrastructure. We believe stablecoins can play an important role in future cross-border settlement and money flows. We are pleased to support Vincent and the First Digital team, who have positioned themselves at the forefront of this rapidly evolving sector.”
Page 3
Transaction Overview
Under the terms of the BCA, (1) First Digital will redomicile from Gibraltar to the Cayman Islands by way of continuation as an exempted company limited by shares; (2) KOYN will merge with and into the Listed Company, a newly formed Cayman Islands exempted company, with the Listed Company as the surviving entity; and (3) a wholly-owned subsidiary of the Listed Company (“Merger Sub”) will merge with and into First Digital, with First Digital as the surviving entity and a wholly-owned subsidiary of the Listed Company.
Upon the closing of the Proposed Transaction, shareholders of KOYN and First Digital will exchange their existing equity interests in KOYN and First Digital, respectively, for the securities of the Listed Company. Such shareholders of KOYN and First Digital will receive Class A ordinary shares of the Listed Company, carrying one vote per share, except that Mr. Chok will receive Class B ordinary shares of the Listed Company, carrying ten votes per share.
The Proposed Transaction values First Digital at $250 million on a pre-money equity basis and contains no minimum cash condition.
First Digital has entered into a non-binding term sheet with Millennial Trading Limited for a $25 million convertible note bearing a 0% coupon, with a $12.00 conversion price; there can be no assurance that definitive agreements will be entered into or that the note will be issued on these terms or at all. First Digital’s existing investors include Kenetic (through Chainer Consultants Limited) and Nogle (through Nogle Limited).
The Proposed Transaction has been approved by the boards of directors of First Digital and KOYN. Closing is expected in the first half of 2027, subject to, among other things, the approval by the shareholders of First Digital and KOYN, regulatory approvals, the registration statement on Form F-4 to be filed by the Listed Company being declared effective by the U.S. Securities and Exchange Commission (the “SEC”), approval of the Listed Company’s listing application by Nasdaq, and the satisfaction or waiver of the other conditions in the BCA. No assurance can be given that the Proposed Transaction will be completed on the terms or timeframe currently contemplated, or at all.
Information about the Proposed Transaction, including a copy of the BCA and the investor presentation, will be provided in one or more Current Reports on Form 8-K to be filed by KOYN with the SEC.
Advisors
Cohen & Company Capital Markets is serving as exclusive capital markets and M&A advisor to First Digital. DLA Piper LLP (US) and DLA Piper UK LLP are serving as legal counsel to First Digital. Loeb & Loeb LLP is serving as legal counsel to KOYN. Black Spade Advisory is serving as strategic advisor to First Digital.
About First Digital
First Digital provides trust and custody services through First Digital Trust Limited, a Hong Kong-licensed trust or company service provider, and issues FDUSD, a USD-referenced stablecoin. It is also the developer of Finance District (fd.xyz), an ecosystem for the agentic economy. Founded in 2019, First Digital holds licences and registrations in Hong Kong and Canada and has more than 75 employees.
For additional information about First Digital, please visit https://1stdigital.com, https://www.firstdigitallabs.com and https://fd.xyz.
Separately, First Digital had filed a writ of summons on April 3, 2025, in the High Court of the Hong Kong Special Administrative Region Court of First Instance initiating a defamation action against Sun Yuchen (a/k/a Justin Sun) in response to his public allegations. Additional information and publicly available filings regarding this matter can be found at: https://1stdigital.com/ir-and-disclosures
Page 4
About CSLM Digital Asset Acquisition Corp III, Ltd. (KOYN)
KOYN is a publicly traded special purpose acquisition company focused on high-growth, frontier-technology sectors including digital assets, regulated financial infrastructure, and next-generation fintech. KOYN is led by an experienced SPAC team with a track record of sourcing, executing, and stewarding complex public-market transactions. KOYN’s Class A Ordinary Shares trade on the Nasdaq under the ticker symbol “KOYN”.
Investor & Media Contacts
For First Digital: Samantha Yap | YAP Global | samantha@yapglobal.com
For KOYN: info@koynspac.com
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the federal securities laws. All information in this press release concerning First Digital has been provided solely by First Digital and has not been independently verified by KOYN or any of its directors, officers, employees, advisors, or affiliates, none of whom make any representation or warranty, express or implied, or accept any responsibility or liability, as to the truth, accuracy, completeness, or reasonableness of such information or any other information contained herein. This press release is provided solely for informational purposes, should not be relied upon for any investment, voting, or other transactional decision, and any such reliance is at the reader’s sole risk.
The expectations, estimates, and projections of the businesses of First Digital and KOYN may differ from their actual results and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions (or the negative versions of such words or expressions) are intended to identify such forward-looking statements. These forward-looking statements also include, without limitation, statements regarding projections, estimates and forecasts of revenue and other financial and performance metrics, projections of market opportunity and expectations, the estimated implied enterprise value of the Listed Company, First Digital’s ability to scale and grow its business, the size and growth of the agentic economy and the stablecoin market, the development and adoption of Finance District and its products, the intended governance of Finance District by FDFI holders, the anticipated transition toward decentralized governance, First Digital’s plans in Korea and other jurisdictions and its pending and intended licence applications, the proposed convertible note with Millennial Trading, the purposes and expected benefits of the listing, the advantages and expected growth of the Listed Company, the Listed Company’s ability to source and retain talent, the cash position of the Listed Company following closing of the Proposed Transaction, KOYN’s and First Digital’s ability to consummate the Proposed Transaction, and expectations related to the terms and timing of the Proposed Transaction. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of KOYN’s and First Digital’s management and are not predictions of actual performance.
Page 5
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Although each of First Digital and KOYN believes that it has a reasonable basis for each forward-looking statement contained in this press release, each of First Digital and KOYN cautions you that these statements are based on a combination of facts and factors currently known and projections of the future, which are inherently uncertain. Most of these factors are outside of the control of First Digital and KOYN and are difficult to predict. Factors that may cause such differences include, but are not limited to: (1) the occurrence of any event, change or other circumstances that could give rise to the termination of the BCA; (2) the outcome of any legal proceedings that may be instituted against First Digital, KOYN, or others following the announcement of the Proposed Transaction; (3) the inability to complete the Proposed Transaction, including due to failure to obtain approval of the shareholders of First Digital and KOYN, certain regulatory approvals, or other conditions to closing; (4) the inability to obtain or maintain the listing of the Listed Company’s securities on Nasdaq or another national securities exchange following the Proposed Transaction; (5) the risk that the Proposed Transaction disrupts current plans and operations as a result of the announcement and consummation of the Proposed Transaction; (6) the ability to recognize the anticipated benefits of the Proposed Transaction, which may be affected by, among other things, competition, the ability of the Listed Company to grow and manage growth profitably and retain its key employees; (7) costs related to the Proposed Transaction; (8) changes in applicable laws or regulations, including those governing stablecoins and digital assets; and (9) other risks and uncertainties included in documents filed or to be filed with the SEC by KOYN or the Listed Company. The foregoing list of factors is not exclusive. In addition, there will be risks and uncertainties described in the proxy statement/prospectus included in the registration statement on Form F-4 relating to the Proposed Transaction, which is expected to be filed by the Listed Company with the SEC, and in other documents filed by the Listed Company, First Digital and/or KOYN from time to time with the SEC. These filings may identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Neither First Digital nor KOYN can assure you that the forward-looking statements in this press release will prove to be accurate.
In light of the significant uncertainties in these forward-looking statements, nothing in this press release should be regarded as a representation by any person that the forward-looking statements set forth herein will be achieved or that any of the contemplated results of such forward-looking statements will be achieved. You should not place undue reliance upon any forward-looking statements, which speak only as of the date made. Subsequent events and developments may cause those views to change. First Digital and KOYN do not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in their expectations or any change in events, conditions, or circumstances on which any such statement is based, except as required by law. Past performance by First Digital’s or KOYN’s management teams is not a guarantee of future performance.
No Offer or Solicitation
This press release shall not constitute a solicitation of a proxy, consent, or authorization with respect to any securities or in respect of the Proposed Transaction. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction where such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities will be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended, or an exemption therefrom.
Page 6
Additional Information and Where to Find It
In connection with the Proposed Transaction, the Listed Company will prepare a registration statement on Form F-4, which will include a proxy statement/prospectus containing information about the Proposed Transaction and the respective businesses of KOYN and First Digital, as well as the prospectus relating to the shares to be issued to First Digital’s and KOYN’s shareholders in connection with the completion of the Proposed Transaction, to be filed with the SEC. After the registration statement is declared effective, the proxy statement/prospectus will be mailed to KOYN’s shareholders. KOYN urges investors and other interested persons to read, when available, the proxy statement/prospectus, as well as other documents filed with the SEC, because these documents will contain important information about the Proposed Transaction. Such persons can also read KOYN’s reports filed with the SEC for a description of the security holdings of its officers and directors and their respective interests as security holders in the consummation of the transactions described herein. The proxy statement/prospectus, once available, and KOYN’s reports can be obtained, without charge, at the SEC’s website (http://www.sec.gov).
Participants in the Solicitation
KOYN, the Listed Company, First Digital and their respective directors, executive officers and other members of their management and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies of KOYN’s shareholders in connection with the Proposed Transaction. Investors and security holders may obtain more detailed information regarding the names, affiliations and interests of KOYN’s directors and officers in KOYN’s reports filed with the SEC. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of proxies to KOYN’s shareholders in connection with the Proposed Transaction will be set forth in the proxy statement/prospectus for the Proposed Transaction when available. Information concerning the interests of First Digital’s and KOYN’s participants in the solicitation, which may, in some cases, be different than those of their respective equity holders generally, will be set forth in the proxy statement/prospectus relating to the Proposed Transaction when it becomes available.
Non-GAAP Financial Measures
This press release may contain certain non-GAAP financial measures and key metrics relating to First Digital’s projected future performance. These non-GAAP measures are preliminary and subject to risks and uncertainties. A reconciliation of these non-GAAP financial measures to the corresponding GAAP measures on a forward-looking basis is not available because the various reconciling items are difficult to predict and subject to constant change. Any variation between First Digital’s actual results and the projected financial information included herein may be material.
Use of Data
The industry data contained herein is derived from various internal and external sources that First Digital and KOYN believe to be reliable. Although First Digital and KOYN are not aware of any misstatements regarding the external data presented herein, their estimates involve risks and uncertainties and are subject to change based on various factors, including those described under “Forward-Looking Statements” above. Any data on past performance or modeling contained herein is not an indication as to future performance, and each of First Digital and KOYN disclaims any obligation, except as required by law, to update or revise the information in this press release, whether as a result of new information, future events or otherwise.
###
Page 7
Exhibit 99.2
FIRST DIGITAL GROUP — INVESTOR PRESENTATION Building infrastructure for the agentic economy . A regulated trust - and - custody fintech — issuer of FDUSD — building technology infrastructure for AI agents. // settlement.stream ● FDUSD · AGENTIC agent_7f3aa1 → merchant_store_90 $0.0042 ✓ api.x402_gw → agent_c4d2e $0.19 ✓ agent_b21e8 → vault_curated_03 $12.40 ✓ prism_api → agent_88c1f $4.10 ✓ agent_9de70 → api.mcp_tool $0.0007 ✓ agent_0xf1a → merchant_5b1c $0.031 ✓ illustrative · agent - to - agent transfers on the FDUSD rail · sub - second finality PROPOSED BUSINESS COMBINATION CSLM Digital Asset Acquisition Corp III DATE October 2026 PRIVATE & CONFIDENTIAL Not an offer to sell or solicit securities. See disclaimer.
This presentation (this “Presentation”) is provided solely for information purposes only and does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation to purchase any equity or debt, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities will be made except by means of a prospectus meeting the requirements of the Securities Act of 1933, as amended, or an exemption therefrom. The information contained herein does not purport to be all - inclusive. The data contained herein is derived from various internal and external sources. No representation is made as to the reasonableness of the assumptions made within or the accuracy or completeness of any projections or modeling or any other information contained herein. Any data on past performance or modeling contained herein is not an indication as to future performance. First Digital assumes no obligation to update the information in this Presentation, except as required by law. Furthermore, any and all trademarks and trade names referred to in this Presentation are the property of their respective owners. No Representation or Warranties All information provided is based upon conditions and assumptions as of the dates reflected herein and no representations or warranties of any kind, express or implied, are given in, or in respect of, this Presentation. To the fullest extent permitted by law in no circumstances will Either First Digital Group Ltd. (“First Digital”) or CSLM Digital Asset Acquisition Corp III, Ltd. (“KOYN”) or any of its respective subsidiaries, stockholders, affiliates, representatives, partners, directors, officers, employees, advisers or agents be responsible or liable for any direct, indirect or consequential loss or loss of profit arising from the use of this Presentation, its contents, its omissions, reliance on the information contained within it, or on opinions communicated in relation thereto or otherwise arising in connection therewith. Industry and market data used in this Presentation have been obtained from third - party industry publications and sources including reports by market research firms and company filings. This Presentation is based on the economic, regulatory, market and other conditions as of the date hereof. It should be understood that subsequent developments may affect the information contained in this Presentation, which neither First Digital, KOYN, nor any of their respective subsidiaries, stockholders, affiliates, representatives, partners, directors, officers, employees, advisers or agents is under an obligation to update, revise or affirm. First Digital has not independently verified the data obtained from these sources and cannot assure you of the data's accuracy or completeness. The data is subject to change. In addition, this Presentation does not purport to be all - inclusive or to contain all of the information that may be required to make a full analysis of First Digital. Viewers of this Presentation should each make their own evaluation of First Digital and of the relevance and adequacy of the information and should make such other investigations as they deem necessary. Trademarks This Presentation may contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Solely for convenience, some of the trademarks, service marks, trade names and copyrights referred to in this Presentation may be listed without the TM, SM, © or ® symbols, but First Digital will assert, to the fullest extent under applicable law, the rights of the applicable owners, if any, to these trademarks, service marks, trade names and copyrights. Forward Looking Statements This presentation contains forward - looking statements made pursuant United States federal securities law, including, but not limited to, statements regarding First Digital's expected future operating results; financial performance and potential revenues, market cap, and exchange volume, business strategy, various addressable markets, anticipated trends, growth, and developments in markets in which it operates, the market adoption of its technology and products, the capabilities, performance, and advancement of its technology, products and services, its pro forma information and its future product development and roadmap. These statements are based on various assumptions, whether or not identified in this Presentation, and on the current expectations of First Digital's management and are not predictions of actual performance. Forward - looking statements generally are accompanied by words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “should,” “would,” “could,” “plan,” “predict,” “potential,” “project,” “pro forma,” “seem,” “seek,” “future,” “outlook,” “model,” “target,” “goal,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward - looking statements will contain these identifying words. All forward - looking statements are based on current assumptions, expectations and beliefs, and involve substantial risks and uncertainties that may cause results, performance or achievement to materially differ from those expressed or implied by these forward - looking statements. These forward - looking statements should not be relied upon as representing First Digital's assessments as of any date subsequent to the date of this Presentation. These forward - looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Except as required by law, First Digital does not undertake any obligation and does not intend to publicly update or revise any forward - looking statement, whether as a result of new information, future developments or otherwise. Use of Projections This Presentation contains projected financial information with respect to First Digital. Such projected financial information constitutes forward - looking information and is for illustrative purposes only and should not be relied upon as necessarily being indicative of future results. The assumptions and estimates underlying such financial forecast information are inherently uncertain and are subject to a wide variety of significant business, economic, competitive and other risks and uncertainties. See “Forward - Looking Statements” above. Actual results may differ materially from the results contemplated by the financial forecast information contained in this Presentation, and the inclusion of such information in this Presentation should not be regarded as a representation by any person that the results reflected in such forecasts will be achieved. Financial Information; Non - IFRS Financial Measures Certain financial information and data contained in this Presentation is unaudited and does not conform to Regulation S - X. Accordingly, such information and data may be presented differently or materially differ from First Digital's audited financial information. In particular, all First Digital projected financial information included herein is preliminary and subject to risks and uncertainties. Any variation between First Digital's actual results and the projected financial information included herein may be material. This presentation also contains non - IFRS financial measures and key metrics relating to First Digital's projected future performance. A reconciliation of these non - IFRS financial measures to the corresponding IFRS measures on a forward - looking basis is not available because the various reconciling items are difficult to predict and subject to constant change. Information Regarding KOYN All information in this presentation concerning First Digital and its affiliates has been provided solely by First Digital and has not been independently verified by KOYN or any of its directors, officers, employees, advisors, or affiliates, none of whom make any representation or warranty, express or implied, or accept any responsibility or liability, as to the truth, accuracy, completeness, or reasonableness of such information or any other information contained herein. This presentation is provided solely for informational purposes, should not be relied upon for any investment, voting, or other transactional decision, and any such reliance is at the reader's sole risk. Disclaimer
2
Risk Factors Prospective investors should carefully consider the risks described below, along with the other information contained in this Pr esentation, before making an investment decision. The risks and uncertainties described below are not exhaustive and not the only ones that First Digital faces. Additional risks and uncerta int ies that are not presently known to First Digital or that it currently deems immaterial may also impair their business operations. If any of these risks actually occur, First Digital's business, f ina ncial condition, results of operations, and prospects could be materially and adversely affected. In such cases, the trading price of the securities could decline, and investors could lose al l or part of their investment. This list of risk factors is not exhaustive, and new risk factors may emerge from time to time. Investors should conduct thei r o wn due diligence and consult with their financial and legal advisors before making any investment decision. A more expansive description of the risk factors will be included in the Form F - 4 registr ation statement to be filed with the SEC by First Digital, and in subsequent filings with the SEC, and such risk factors will be more extensive than, and may differ significant from, the abov e s ummary. • The development and expansion of the digital asset market are subject to numerous complex and interrelated factors that are i nhe rently difficult to predict or assess. If the digital asset market does not grow as expected, F irst Digital’s business, operating results and financial condition could be adversely affected. • Stablecoins may face periods of uncertainty, loss of trust, or systemic shocks resulting in the potential for rapid redemptio n r equests or runs. Extreme scenarios, such as market shocks that affect the value of FDUSD reserves or simultaneous requests to redeem all or substantially all FDUSD in circulation, or concerns rel ate d to FDUSD reserves, may lead to redemption delays and FDUSD reserves being insufficient to meet all redemption requests. • As a relatively new innovation, stablecoins are particularly susceptible to operational challenges and risks, including due t o s urges in demand. • Any significant disruption in First Digital or F irst Digital’s third - party service providers’ or partners’ technology, information technology systems, or the blockchain networks it supports, including risks arising from multi - chain and crosschain operations, could result in a loss of customers or funds and adversely impact its busine ss, results of operations, financial condition, and prospects. • First Digital is subject to an extensive and highly evolving regulatory landscape. The regulatory environment to which it is sub ject gives rise to various licensing requirements, significant compliance costs and other restrictions, and noncompliance could result in a range of penalties, including fines, compliance costs, oper ati onal restrictions, reputational damage, and loss of licenses. • First Digital is subject to complex and evolving laws, regulations, and industry requirements related to data privacy, data p rot ection, and information security across different markets where it conducts its business. Such laws, regulations, and industry requirements are constantly evolving and changing. • First Digital’s inability to maintain existing relationships with financial institutions and other key partners or to enter i nto new such relationships could impact First Digital’s ability to offer services. • If First Digital is unable to maintain existing distribution and partnership arrangements or enter into additional distributi on or partnership arrangements on less favorable financial terms, FDUSD in circulation and our financial results may be adversely affected. • Cyberattacks and security breaches of First Digital’s systems, or those impacting our customers or third - party suppliers and ven dors, could adversely impact its business, results of operations, financial condition, and prospects. • First Digital is and may continue to be subject to litigation, including individual and class action lawsuits, as well as reg ula tory audits, disputes, inquiries, investigations, and enforcement actions by regulators and governmental authorities. Disputes with customers, business partners, or any other third parties could h arm First Digital’s reputation, increase costs, and negatively impact our business, operating results and financial condition. • Unfavorable media coverage could negatively affect First Digital’s business. • First Digital’s intellectual property rights are valuable. Any inability to protect and enforce such intellectual property ri ght s could adversely impact First Digital’s business, results of operations, financial condition, and prospects. First Digital may be sued by third parties for alleged infringement of their proprietary rig hts. • First Digital is dependent on certain key personnel and may be unable to attract and retain qualified and skilled employees. • First Digital’s officers, directors, employees, and large shareholders, as well as their affiliates may be subject to legal, regulatory, admi nis trative proceedings, litigation, lawsuits, investigations and enforcement or disciplinary actions by regulators and governmental authorities.
3
01 / 06 — WHO IS FIRST DIGITAL 01 Built on trust. Building the agentic economy. A regulated trust company, climbing the stack. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
4
01 — WHO IS FIRST DIGITAL From Regulated Trust to the Agentic Economy A compliance - first fintech built on a regulated Hong Kong trust foundation — now issuer of a leading Asia - centric stablecoin and infrastructure provider for the agentic economy. // TURNOVER By capital turnover, 2024 (1) // VOLUME #1 >$4tn Trading volume (as of June 2026) (2) // ATH_MCAP $4.4bn FDUSD all - time - high market cap (3) // REVENUE_25 $87mm FY2025 revenue (audited) // LICENSES 4 3 licenses and registrations obtained, with 1 additional application pending (4) THE CLIMB ASCENDING THE STACK lvl.01 Regulated trust & custody the historic foundation lvl.02 FDUSD a professional - grade stablecoin Finance District / Prism (1) Turnover defined as 24h Volume / Market Capitalization (among major stablecoins); Source - CoinMarketCap , as of 2024. (2) Cumulative spot trading volume across all exchanges tracked by CoinMarketCap , 26 July 2023 to 30 June 2026 (4) Includes a Trust or Company Service Provider (TCSP) licence in Hong Kong, two Money Services Business (MSB) registrations in Canada and one licence application pending with the Abu Dhabi Global Market (ADGM) for the issuance of fiat - referenced tokens (FRT). (3) CoinMarketCap , ATH Market Capitalization of $4.42bn as of 26 th April 2024.
5
01 — WHO IS FIRST DIGITAL Four Business Lines, One Ecosystem From regulated custody to agentic commerce. mod.01 Custody First Digital Trust Limited — a regulated Hong Kong trust company. Multi - asset trust, custody & escrow, safekeeping and fiduciary services. Revenue recognized through service fee and transaction fee income. mod.02 FDUSD Asia - centric, fully - backed USD stablecoin issued by First Digital Labs; built for professional market participants and distributed via leading industry partners. Reserve revenue recognized. mod.03 Stablecoin Infrastructure Stablecoin issuance infrastructure, including the platform behind FDUSD, available to partners and enterprises. Targeted new revenue stream – no revenue recognized to date. mod.04 Finance District & Prism The incubated project carrying First Digital into the agentic economy. FDFI is the Finance District ecosystem token. Targeted new revenue stream – no revenue recognized to date. ONE ECOSYSTEM · VALUE FLOWS → First Digital Labs is the brand under which FD121 (BVI) Limited, a First Digital group company, issues FDUSD.
6
06 — CORPORATE · FINANCIALS · TRANSACTION Guided by a Strong Management Team Trust, custody, payments and engineering — building from a regulated foundation into the agentic economy. Vincent Chok CEO CEO of First Digital since inception; UBO of Legacy Trust. Led the company from traditional trust & custody into stablecoins. Gunnar Jaerv COO Responsible for operations and product development; building efficient operational infrastructure across the group. Michael Titus LEGAL COUNSEL Principal of Titus Solicitors; specialized in corporate, commercial and intellectual - property law. Janno Jaerv CTO Responsible for First Digital's tech stack; 20+ years across technology and engineering roles. Previously at Foxway. Aleck Lee CFO Leads the Finance team; previously Asia CFO of LIFCO, and earlier with PwC and Deloitte. Headshots and prior affiliations as provided by management. Roger Lee COMMERCIAL & PARTNERSHIPS Business development and institutional partnerships ; 12+ years in venture and digital assets. Cherry Chok HEAD OF PEOPLE OPERATIONS Responsible for HR and people operations across all regions. Zoe Hubbard DEPUTY COO Group initiatives and day - to - day operations; 20+ years in regulated finance. Chloe Low COMPLIANCE LEAD Previously VP at RHB Investment Bank; earlier at Citigroup Transaction Services. Timothy Shin SENIOR ADVISOR, APAC Leads APAC market involvement; California - licensed attorney based in Seoul.
7
// FOOTPRINT AT A GLANCE › 75 employees across the group (October 2026). › Offices in Hong Kong, Malaysia and the UK. › Hong Kong and Malaysia are 97% of headcount. › IT, Finance and Legal & Compliance lead by function. › 6 in executive management; 69 non - executive. // HEADCOUNT BREAKDOWN As OF OCTOBER 2026 site.01 London UK entity 3% of headcount site.02 · HQ Hong Kong Group headquarters 50% of headcount Largest office site.03 Kuala Lumpur Malaysia entity 47% of headcount 2nd - largest office 06 — CORPORATE · FINANCIALS · TRANSACTION Global Footprint Three offices across Asia and Europe.
8
02 / 06 — THE OPPORTUNITY 02 The next platform shift needs money that moves like software . By 2030, $1.7 trillion in commerce will run through AI agents. — Edgar, Dunn & Co. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
9
02 — THE OPPORTUNITY The Next Platform Shift Every technology era moves from human effort to automation. The agentic web is the next step — and it needs payment rails built for machines. ERA 01 PC era Command line Human dictates logic → ERA 02 Web / app era Screens & navigation Human navigates → ERA 03 Assistive AI Chat & voice Human guides the agent → ERA 04 · NOW Agentic web Every interaction point From human effort to full automation →
10
02 — THE OPPORTUNITY Why Now: The Agentic Commerce Inflection 2025 – 26 is the buildout year — every major payment network, AI lab and PSP has shipped agentic - payment products. THE BUILDOUT TIMELINE · 2025 – 26 Apr '25 Visa launches Intelligent Commerce; Mastercard unveils Agent Pay Sep '25 OpenAI + Stripe launch ACP; Google AP2; Coinbase + Cloudflare x402 Oct '25 Visa scales with partners; Mastercard enables US cardholders Dec '25 Visa: 2025 the “final year consumers shop alone” Feb '26 Coinbase launches Agentic Wallets (x402) Apr '26 Stripe opens Link to AI agents at Sessions 2026 47% of US shoppers already use AI for ≥1 shopping task (1) 4,700% YoY increase in AI - driven traffic to retail sites (2) ~$67 – 73B of Cyber Week 2025 sales influenced by AI / agents (3) 57% of executives expect agentic payments mainstream within 3 yrs (4) (1) https://usa.visa.com/about - visa/newsroom/press - releases.releaseId.21961.html (2) https://business.adobe.com/blog/generative - ai - powered - shopping - rises - with - traffic - to - retail - sites (3) https://www.salesforce.com/news/stories/2025 - cyber - week - predictions/ (4) https://bankingblog.accenture.com/agentic - payments - commerce
11
02 — THE OPPORTUNITY Agentic Payments: The $1.7 Trillion Opportunity AI agents are creating a new category of commerce — and a generational opportunity in programmable settlement. // AGENTIC COMMERCE TOTAL ADDRESSABLE MARKET (TAM) · 2030 $1.7T up from $136B in 2025 — Edgar, Dunn & Co. ~67% CAGR, 2025 – 2030 Edgar, Dunn & Co. (1) $2T stablecoin supply by 2028 Standard Chartered, per McKinsey (2) // growth_curve 2025 → 2030 $136B 2025 $1.7T 2030 (1) https://www.edgardunn.com/articles/agentic - commerce - the - future - of - payments (2) https://www.mckinsey.com/industries/financial - services/our - insights/the - stable - door - opens - how - tokenized - cash - enables - next - ge n - payments
12
02 — THE OPPORTUNITY Sizing the Opportunity: TAM / SAM / SOM From the total agentic - commerce market to the stablecoin - settled slice First Digital can realistically capture. Total Addressable Market $200 – 250B Agentic commerce Edgar Dunn estimates global agentic commerce spend at $136B by 2025, growing to $1.7T by 2030 (~67% CAGR). (1) $20 – 60B Stablecoin - settled agentic payments McKinsey notes stablecoin supply doubled to $250B in 18 months from January 2024 – July 2025; Standard Chartered forecasts ~$2T by 2028. (2) $1 – 6B First Digital opportunity For 2027, management assumes a 5 – 10% share of the stablecoin agentic rail where Finance District is live. (3) (1) https://www.edgardunn.com/articles/agentic - commerce - the - future - of - payments (2) https://www.mckinsey.com/industries/financial - services/our - insights/the - stable - door - opens - how - tokenized - cash - enables - next - ge n - payments; implied 30% stablecoin penetration. (3) Range of 5% - 10% of SAM; internal management estimate
13
03 / 06 — INDUSTRY TRENDS & DRIVERS 03 Stablecoins. Agentic AI. Payments. Converging now — and we sit where they meet. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
14
03 — INDUSTRY TRENDS & DRIVERS First Digital Sits at the Intersection of Three Key Industry Trends Stablecoins, agentic AI, and payments / settlement are converging — and First Digital sits where they meet. CONVERGING TRENDS & INDUSTRY FOCUS AREAS OPPORTUNITY WEDGES · LIVE & PLANNED First Digital Agentic Commerce Protocols Programmable Settlement Rails Regulated Trust + Transparency Developer - first infrastructure Live: developer platform + Agent Wallet + Prism for merchant settlement. Cross - border, permissionless Independent third parties use FDUSD for treasury, payouts and remittances. Professional → consumer Planned: extend FDUSD's professional base toward consumer agentic commerce.
15
03 — INDUSTRY TRENDS & DRIVERS When Machine - Readable Interfaces Meet Machine - Native Money Agents need two things to transact: a way to read your business, and a way to pay it. INTERFACES How agents read your business Proprietary APIs Custom SDKs, walled gardens, scraping. → Open APIs / REST Documented endpoints. Built for humans. → MCP / Agent Skills MONEY How agents pay your business Cash & Cards Human - signed. Friction at every hop. → Bank Rails Programmable - ish. Hours, not seconds. → Stablecoins CONVERGENCE Agentic Commerce Agents are the engine. Stablecoins are the fuel.
16
03 — INDUSTRY TRENDS & DRIVERS Stablecoins Are Becoming the Default Currency for AI Agents Industry leaders are converging on one thesis: agents get crypto wallets, not bank accounts. “ Agents will transact in stablecoins at scale. Jeremy Allaire Circle Cointelegraph · Jan 2026 “ Crypto is the native currency for AI agents. CZ Binance Cointelegraph · Feb 2026 “ Agents get crypto wallets where they can't get bank accounts. Brian Armstrong Coinbase FintechWeekly · Mar 2026 PROOF POINT Coinbase Agentic Wallets launched Feb 11, 2026; x402 has processed 165M+ transactions (Base; Solana / Polygon support).
17
03 — INDUSTRY TRENDS & DRIVERS Why Stablecoin Settlement Is Structurally Advantaged Agents create high - frequency, low - value flows that legacy fee models can't support. COST OF A $0.01 MICROPAYMENT (ILLUSTRATIVE) Card rails $0.30 · 3,000% Stablecoin $0.0001 · 1% Machine - to - machine commerce needs rails with near - zero fixed fees and real - time finality. STRUCTURAL ADVANTAGES Push payments Agents control outflows — no credential “pull”. Programmability Encode budgets, limits, time windows and conditional release. 24/7 settlement Built for autonomous operation with full auditability. Ecosystem tailwinds Stablecoin supply forecast ~$2T by 2028 (Standard Chartered). Compete where the new volume is born - micropayments, agent - to - agent and cross - border automation - and supply the infrastructure that layer runs on, the highest - margin part of the stack.
18
03 — INDUSTRY TRENDS & DRIVERS FDUSD: The Asia - Centric Stablecoin A leading USD - backed stablecoin built for professional market participants in Asia — the fastest - growing stablecoin - payments region. (1) (1) https://www.mckinsey.com/industries/financial - services/our - insights/beyond - stablecoins - the - emerging - architecture - of - on - chain - money?cid=soc - web Progmat Mitsubishi UFJ · Japan HKDR Round Dollar · HK XSGD StraitsX · Singapore JPYC JPYC · Japan USDe Ethena · BVI $U United Stables · BVI RLUSD Ripple · US/UK PYUSD PayPal · US USDT Tether · BVI USDC Circle · US ↑ Asia - focused Rest of world ← Thin rails Deep settlement rails → RAILS DEPTH JURISDICTION WHITESPACE FDUSD First Digital Labs Competitor positions illustrative (DefiLlama / CoinMarketCap). FDUSD issued by First Digital Labs.
19
03 — INDUSTRY TRENDS & DRIVERS How It Works: Agents Spend, Merchants Receive Two products, one rail — the Agent Wallet (buy side) and Prism (sell side). BUY SIDE Agent Wallet AI - native wallet — any agent holds digital assets across chains and signs autonomously. Key custody in secure (TEE) enclaves Simple top - up spending controls (“pocket - money” model) Multi - chain, gas abstracted SELL SIDE Prism Merchants accept stablecoin transfers — receive any stablecoin from any chain. x402 - compatible orchestration Smart routing with configurable compliance screening Programmable fee splits; drop - in integration FDUSD RAIL
20
04 / 06 — FINANCE DISTRICT ECOSYSTEM 04 From a stablecoin for professionals to an economy for everyone . An on - chain financial OS — built for humans and AI agents alike. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
21
04 — FINANCE DISTRICT ECOSYSTEM Finance District: A Complete On - Chain Financial Ecosystem Built for humans and AI agents on equal footing - an ecosystem for the agentic econom y developed by First Digital. Four products live: District Pass, Agent Wallet, Prism and an AI assistant . 01 · LIVE Hold FDUSD across any chain, agent or user. 02 · UPCOMING Earn AI - enabled earn opportunities via upcoming on - chain products. 03 · LIVE Transact Merchants transact via Prism + agent - to - agent settlement. 04 · FDFI · UPCOMING Govern Make the chains disappear into what people care about. FDFI does not represent any equity, ownership, or other proprietary interest in FDG or its subsidiaries. FDFI holders have no ri ghts to the revenues, profits, assets, dividends, or other economic returns of FDG or its subsidiaries and do not possess any shareholder or corporate governance rights with respect to FDG or its subsidiaries therein.
22
04 — FINANCE DISTRICT ECOSYSTEM A Growing Ecosystem Six layers today and expanding. As more components are added to Finance District over time, FDFI’s remit grows with it. ↑ VALUE FLOWS UP L6 FDFI L5 Agent Wallet | Prism Activation — buy side / sell side L4 Curated Vaults Earn (rolling out) L3 FDUSD L2 Reserves T - bills & highly - liquid assets L1 Banking rails (18+) Fiat infrastructure FDFI confers no rights to the revenues, profits, assets or governance of FDG or its subsidiaries.
23
04 — FINANCE DISTRICT ECOSYSTEM Building Finance District FDFI — the ecosystem token of Finance District (FD.XYZ). First Digital Group Incubator & service provider → Finance District The token is the ecosystem First Digital is incubator and service provider only — it holds no equity in Finance District. Its economic interest is limited to ~10% of FDFI and service fees (1) . FDFI · TOKEN SPEC Standard LayerZero Compatible Omnichain Fungible Token (OFT) Supply Fixed supply — 2bn FDFI Issuer XFD Issuer Limited FD.XYZ An on - chain “financial district” (1) Arms - length structure: First Digital holds no equity in Finance District - a foundation with no shareholders or share capita l. FDFI is issued through XFD Issuer Limited, an FDG - owned SPV that ring - fences issuance and is to be wound up after delivery.
24
05 / 06 — WHY US 05 Others wrap existing rails. We built the full stack. Custody + settlement + FDUSD + agentic infrastructure. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
25
05 — WHY US No One Has the Full Stack Custody + settlement + FDUSD + agentic infrastructure — versus players who cover only part of the stack. First Digital Tether Circle Ondo BlackRock Stablecoin distribution ✓ ✓ ✓ — — T - bill stablecoin reserves ✓ ✓ ✓ — — Agent - native infrastructure ✓ ✓ — — Curated vaults In progress — — Partial — Ecosystem governance token ✓ — — — Reserves held by regulated financial institutions ✓ ✓ ✓ ✓ ✓ Ecosystem governance token: FDFI is the governance token of Finance District; FDFI confers no rights in First Digital or FDUS D. Finance District is designed to be governed by FDFI holders over time; decentralisation is an intended future state, not a present one. Partial ✓
26
05 — WHY US A New Standard Layer Is Forming Six major agentic - payment standards are converging; the likely outcome is interoperability, not winner - take - all. ACP OpenAI + Stripe AP2 TAP Visa Agent Pay Mastercard x402 MCP Anthropic WHERE FIRST DIGITAL FITS The infrastructure merchants and agents use to plug into x402, UCP and ACP flows.
27
06 / 06 — CORPORATE · FINANCIALS · TRANSACTION 06 A revenue - generating business, built compliance - first . Corporate, financials and the proposed transaction. 01 Who is First Digital 02 The Opportunity 03 Industry Trends & Drivers 04 Finance District Ecosystem 05 Why Us 06 Corporate · Financials · Transaction
28
06 — CORPORATE · FINANCIALS · TRANSACTION Backed by Leading Investors and Partners Grouped to distinguish financial backers, Finance District supporters, and ecosystem partners. FINANCIAL BACKERS First Digital Group investors Token - sale investors are Finance District supporters, not First Digital investors. FINANCE DISTRICT SUPPORTERS Incubated - project / token - sale backers
29
06 — CORPORATE · FINANCIALS · TRANSACTION Summary Financials Summary Financials ($mm) $87 $6 ($17) FY2025A $27 ($19) FY2026 (audit in progress) Total Revenue Net Revenue Adjusted Operating Loss Total Revenue Model Comprised of: › FDUSD revenue is driven by reserves in cash and equivalents, with approximately 85% allocated to risk - free assets (e.g. short - dated treasury bills) › Custody revenue is expected to grow steadily Net Revenue Net of fees for technology partners, reward programs, and investment management related to FDUSD, scaling with revenue and market cap. Note: Adjusted Operating Loss excludes taxes, depreciation and amortization. Figures are management - provided. ($4)
30
06 — CORPORATE · FINANCIALS · TRANSACTION Illustrative Transaction Overview SOURCES & USES ($M) PRO - FORMA VALUATION ($M) Pro - forma enterprise value of $368M on a debt - free, cash - free basis. (2) PRO - FORMA OWNERSHIP 51.5% FD rollover (3) 39.5% Trust / PIPE 9.0% SPAC sponsor Financing Assumes 0% redemption from $230M cash in trust. Uses include product development, market expansion and general corporate purposes. Structure First Digital shareholders roll 100% of equity — expected pro - forma ownership of 51.5%. Earnout Based on share price hurdles measured over a period following closing, which we believe will result from performance and platform adoption. (1) Assumes 0% redemptions. (2) Assumes purchase price on a debt - free, cash - free basis. (3) Excludes additional management earnout. $250 First Digital rollover equity $230 Cash in trust (1) $480 Total sources $250 Equity to First Digital $215 Cash to balance sheet $15 Transaction expenses $48 0 Total uses 58.3 Shares outstanding (M) $10.00 Share price ($) $583 Equity value ($215) ( – ) PF net cash $368 Enterprise value Own % Shares Holder 51.5% 30.0M FD rollover (3) 39.5% 23.0M Trust / PIPE 9.0% 5.3M SPAC sponsor
31
06 — CORPORATE · FINANCIALS · TRANSACTION High - Profile Advisory Board to Enhance Governance Luc Froehlich 20+ years of experience in portfolio management and digital - asset solutions Currently Chief Commercial Officer at RAK Digital Assets Oasis Chris Harmse 12+ years of experience in investments, trading, and stablecoin payments Co - Founder and Chief Business Officer of BVNK Praful Morar 37+ years of experience in financial planning, payments, and business development Previously Global Expansion Officer at Nuvei Sandy Peng 11+ years of experience in blockchain technology and investment products Co - Founder of Scroll and previously a Partner at Fission Capital Neil Tan 20+ years of experience in advisory, consulting, and business development Former Chairman of the FinTech Association of Hong Kong and member of the Web3 Task Force Advisory board members and affiliations as provided by the Company.
32
06 — CORPORATE · FINANCIALS · TRANSACTION Why First Digital, Why Now A revenue - generating, compliance - first group positioned at the center of the agentic economy shift. #1 by capital turnover, 2024 Amongst major stablecoins (1) Large, growing market $1.7T agentic commerce (2) ; $2T stablecoin supply. (3) Scalable technology Agent Wallet + Prism on the FDUSD rail. Defensible growth plan Clear path from professionals to consumers. Compliance - first Built on a regulated trust foundation. Experienced team (2) https://www.edgardunn.com/articles/agentic - commerce - the - future - of - payments (3) https://www.mckinsey.com/industries/financial - services/our - insights/the - stable - door - opens - how - tokenized - cash - enables - next - ge n - payments (1) Turnover defined as 24h Volume / Market Capitalization (among major stablecoins); Source - CoinMarketCap , as of 2024.
33