Niocorp Developments Ltd 8-K, filed Mar 17, 2023
Niocorp Developments Ltd (NB)
About this 8-K
Niocorp Developments Ltd filed this 8-K on March 17, 2023.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.01: Completed an acquisition or sale of assets
- Item 3.01: Delisting notice or listing transfer
- Item 3.02: Unregistered sale of equity
- Item 3.03: Change to shareholders' rights
- Item 5.02: Director or officer change, or executive pay
- Item 7.01: Regulation FD disclosure
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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INTRODUCTORY NOTE
As previously disclosed, on September 25, 2022, NioCorp Developments Ltd., a company organized under the laws of the Province of British Columbia (“NioCorp”), GX Acquisition Corp. II, a Delaware corporation (“GX”), and Big Red Merger Sub Ltd, a Delaware corporation and a direct, wholly owned subsidiary of NioCorp (“Merger Sub”), entered into a Business Combination Agreement (the “Business Combination Agreement”). Following approval by the shareholders and stockholders of NioCorp and GX, respectively, and the satisfaction or waiver of all other closing conditions, the transactions contemplated by the Business Combination Agreement were consummated and closed (the “Closing”) on March 17, 2023 (the “Closing Date”). The Closing was the earliest event required to be reported in this Current Report on Form 8-K.
Pursuant to the Business Combination Agreement, the following transactions occurred on the Closing Date: (i) Merger Sub merged with and into GX, with GX surviving the merger (the “First Merger”); (ii) all Class A shares in GX (the “GX Class A Shares”) that were held by stockholders (the “GX Public Stockholders”) who did not elect to exercise their redemption rights in connection with the transactions were converted into shares of Class A common stock in GX (such shares, the “First Merger Class A Shares”), as the surviving company in the First Merger; (iii) NioCorp purchased all First Merger Class A Shares (the “Transaction Consideration Shares”) in exchange for common shares, without par value, of NioCorp (“NioCorp Common Shares”) (the “Exchange”); (iv) NioCorp assumed GX’s obligations under the GX Warrant Agreement (as defined below) and each share purchase warrant of GX, exercisable for GX Class A Shares (such warrant, a “GX Warrant”), that was issued and outstanding immediately prior to the effective time of the Exchange and each such assumed warrant was converted into a warrant to acquire NioCorp Common Shares (such warrant, a “NioCorp Assumed Warrant”); (v) all of the First Merger Class A Shares were contributed by NioCorp to 0896800 B.C. Ltd., a company organized under the laws of the Province of British Columbia and a direct, wholly owned subsidiary of NioCorp (“Intermediate Holdco”), in exchange for additional shares of Intermediate Holdco, resulting in GX becoming a direct subsidiary of Intermediate Holdco; (vi) Elk Creek Resources Corp., a Nebraska corporation and a direct, wholly owned subsidiary of Intermediate Holdco, merged with and into GX, with GX surviving the merger as a direct subsidiary of Intermediate Holdco (the “Second Merger,” and, together with the First Merger, the “Mergers”); and (vii) following the effective time of the Second Merger, each of NioCorp and GX, as the surviving company of the Second Merger, effectuated a reverse stock split at a ratio of 10-for-1 (the “reverse stock split”). The Mergers, the Exchange and the other transactions contemplated by the Business Combination Agreement are collectively referred to herein as the “Transactions.” The Transactions constituted GX’s initial business combination, as that term was defined in GX’s Amended and Restated Certificate of Incorporation prior to the First Merger.
The foregoing description of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by the full text of the Business Combination Agreement, a copy of which is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated by reference into this Introductory Note.
Unless the context otherwise requires, “we,” “us,” “our,” and the “Company” refer to NioCorp and its consolidated subsidiaries after giving effect to the Transactions. Terms used but not defined herein, or for which definitions are not otherwise incorporated herein by reference, have the respective meanings given to such terms in the joint proxy statement/prospectus of the Company and GX, dated February 8, 2023 (the “Joint Proxy Statement/Prospectus”), filed with the Securities and Exchange Commission (the “SEC”) on February 8, 2023.
As a result of the Transactions:
| · | each GX Class A Share was, in connection with the Exchange, converted into 11.1829212 NioCorp Common Shares (or 1.11829212 NioCorp Common Shares after giving effect to the reverse stock split); |
| · | each share of Class B common stock of GX issued and outstanding immediately prior to the First Merger (such share, a “GX Class B Share”) that was not surrendered for cancellation in accordance with the GX Support Agreement (as defined below) was (i) upon consummation of the First Merger, converted on a one-for-one basis into a share of Class B common stock of GX (such shares, the “First Merger Class B Shares”), as the surviving company in the First Merger, and (ii) upon consummation of the Second Merger, each First Merger Class B Share was converted into 11.1829212 shares (or, after |
giving effect to the reverse stock split, 1.11829212 shares) of Class B common stock of GX (such shares, the “Second Merger Class B Shares”) as the surviving company in the Second Merger, in a private placement, and each Second Merger Class B Share remains outstanding following the transactions and is exchangeable into NioCorp Common Shares on a one-for-one basis, subject to equitable adjustments; and
| · | each GX Warrant was (i) in connection with the First Merger, assumed by NioCorp pursuant to the Warrant Assumption Agreement (as defined below) and (ii) immediately prior to the Exchange, converted on a one-for-one basis into a NioCorp Assumed Warrant, and the number of NioCorp Common Shares subject to each NioCorp Assumed Warrant is equal to the number of shares of GX Common Stock subject to the applicable GX Warrant multiplied by 11.1829212 (or 1.11829212 after giving effect to the reverse stock split), with the applicable exercise price per Common Share adjusted accordingly. |
No fractional NioCorp Common Shares were issued in connection with the Transactions and instead, any such fractional shares that would otherwise have resulted were rounded down to the nearest whole share.
As soon as practicable following the effective time of the First Merger (the “First Merger Effective Time”), and in any event within two business days following the First Merger Effective Time, the Company will cause the exchange agent to deliver to each GX stockholder, as of immediately prior to the First Merger Effective Time, a letter of transmittal and instructions for use in exchanging such GX stockholder’s GX Class A Shares for such GX stockholder’s applicable portion of the Transaction Consideration Shares. Promptly following receipt of a GX stockholder’s properly executed letter of transmittal, the exchange agent will deliver such GX stockholder’s applicable portion of the Transaction Consideration Shares.
Further, pursuant to the GX Support Agreement, dated September 25, 2022 (the “GX Support Agreement”), by and among GX Sponsor II LLC (the “Sponsor”), GX, NioCorp and the persons identified on Schedule I therein, the Sponsor, immediately prior to the Closing, surrendered to GX for cancellation 384,324 GX Class B Shares for no consideration.
Immediately after giving effect to (i) the redemption of 28,506,605 GX Class A Shares, (ii) the subsequent issuance of 74,909 GX Class A Shares to advisors and (iii) the Transactions, including the reverse stock split, there were 30,081,661 NioCorp Common Shares, 7,957,404 Second Merger Class B Shares and 15,666,667 NioCorp Assumed Warrants outstanding.
Based on NioCorp’s cash and cash equivalents of approximately $0.4 million as of December 31, 2022, after giving effect to the Transactions, the closing of the transactions contemplated by the Yorkville Convertible Debt Financing Agreement (as defined below) and the net proceeds of approximately $15.9 million received from the GX trust account (after giving effect to an aggregate of approximately $288.8 million of redemptions of GX Class A Shares in connection with the Transactions), less the sum of (i) the total direct and incremental transaction costs of GX estimated at approximately $13.5 million (including $5.0 million of deferred underwriters’ commissions) and (ii) the total direct and incremental transaction costs of NioCorp estimated at approximately $6.8 million, the Company would have cash and cash equivalents of approximately $15.4 million.
The NioCorp Common Shares and the NioCorp Assumed Warrants are expected to begin trading on The Nasdaq Global Market and The Nasdaq Capital Market, respectively, on March 21, 2023, under the symbols “NB” and “NIOBW,” respectively. The NioCorp Common Shares will continue to trade on the Toronto Stock Exchange (“TSX”) under the symbol “NB,” and will continue to trade on a pre-reverse stock split basis until such time as the TSX advises that trading on a post-reverse stock split basis will commence, which is expected to be at the beginning of regular trading hours on March 21, 2023. The NioCorp Common Shares will cease being quoted on the OTC Markets in connection with the commencement of trading on The Nasdaq Global Market.
| Item 1.01 | Entry into a Material Definitive Agreement. |
Registration Rights and Lockup Agreement
Pursuant to the Business Combination Agreement, at the Closing, NioCorp, GX and the Sponsor, in its capacity as a shareholder of GX, the pre-Closing directors and officers of NioCorp and the other parties thereto (collectively, the “RRA Shareholders”) entered into the Amended and Restated Registration Rights Agreement, dated March 17, 2023 (the “Registration Rights and Lockup Agreement”), pursuant to which, among other things, NioCorp became obligated to file a shelf registration statement to register the resale of (i) outstanding NioCorp Common Shares, (ii) NioCorp Common Shares exchangeable for the Second Merger Class B Shares, (iii) NioCorp Assumed Warrants and (iv) NioCorp Common Shares issuable upon exercise of the NioCorp Assumed Warrants, in each case, held by the RRA Shareholders after the Closing (such shares, the “Registrable Securities”). The Registration Rights and Lockup Agreement also provides the RRA Shareholders with certain “demand” and “piggy-back” registration rights, subject to certain requirements and customary conditions.
Under the terms of the Registration Rights and Lockup Agreement, NioCorp is obligated, subject to certain exceptions, to (i) as soon as practicable, but not later than 30 days following the Closing, file a registration statement with the SEC covering the resale or other disposition of the Registrable Securities, (ii) use its reasonable best efforts to cause the registration statement to become effective no later than the earlier of (a) 90 days after the filing date thereof if the SEC notifies NioCorp that it will “review” the registration statement and (b) 10 business days after the date that NioCorp is notified by the SEC that the registration statement will not be reviewed or will not be subject to further review, and (iii) use its reasonable best efforts to keep such registration statement continuously effective under the Securities Act of 1933, as amended (the “Securities Act”), until such time as there are no longer any Registrable Securities covered by the Registration Rights and Lockup Agreement.
In addition, the Registration Rights and Lockup Agreement provides that the RRA Shareholders are subject to “lock-up” restrictions on transfer of the Registrable Securities held by them after the Closing for the period beginning on the Closing Date and ending on the earliest of (i) one year after the Closing, (ii) the date on which the volume-weighted average price of the NioCorp Common Shares on the principal securities exchange or market on which such securities are then traded has equaled or exceeded the quotient of $13.42 per share divided by 11.1829212 (as adjusted for any stock splits, including the reverse stock split, recapitalizations and similar events) for 20 trading days within any 30-trading day period commencing at least 150 days after the Closing Date and (iii) the date on which NioCorp completes a liquidation, merger, capital stock exchange, reorganization or similar transaction that results in all of NioCorp’s shareholders having the right to exchange their NioCorp Common Shares for cash, securities or other property.
The Registration Rights and Lockup Agreement will terminate on the earlier of (i) the tenth anniversary of the date of such agreement and (ii) with respect to any RRA Shareholder, on the date that such RRA Shareholder no longer holds any Registrable Securities.
In addition, on the Closing Date, the Company entered into a joinder agreement (the “Registration Rights Joinder”) with the Sponsor’s members to whom the Sponsor distributed all of the Second Merger Class B Shares and NioCorp Assumed Warrants held by the Sponsor immediately following the Closing. Pursuant to the Registration Rights Joinder, each such member agreed to become a party to, to be bound by, and to comply with the Registration Rights and Lockup Agreement as a RRA Shareholder, and all of the (i) outstanding NioCorp Common Shares, (ii) NioCorp Common Shares exchangeable for the Second Merger Class B Shares, (iii) NioCorp Assumed Warrants and (iv) NioCorp Common Shares issuable upon exercise of the NioCorp Assumed Warrants held by such member became Registrable Securities.
The foregoing description of the terms of the Registration Rights and Lockup Agreement and the Registration Rights Joinder is subject to, and is qualified in its entirety by, the full text of the Registration Rights and Lockup Agreement and the Registration Rights Joinder, which are attached as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K, which documents are incorporated by reference in their entirety into this Item 1.01.
Exchange Agreement
Pursuant to the Business Combination Agreement, at the Closing, NioCorp, GX and the Sponsor entered into the Exchange Agreement, dated March 17, 2023 (the “Exchange Agreement”), pursuant to which, among other things, the Sponsor and certain pre-Closing officers and directors of GX have agreed that, with respect to certain Second Merger Class B Shares that are subject to an earnout period, the Sponsor and certain pre-Closing officers and directors of GX will not transfer such shares until the NioCorp Common Shares achieve trading prices exceeding certain dollar thresholds set forth in the GX Support Agreement, subject to the terms and conditions contemplated by the GX Support Agreement. Such Second Merger Class B Shares will be forfeited if the NioCorp Common Shares do not achieve the specified trading prices prior to the tenth anniversary of the Closing Date.
The foregoing description of the terms of the Exchange Agreement is subject to, and is qualified in its entirety by, the full text of the Exchange Agreement, which is filed as Exhibit 10.3 to this Current Report on Form 8-K, which document is incorporated by reference in its entirety into this Item 1.01.
Warrant Assignment, Assumption and Amendment Agreement
The information set forth in the Introductory Note with respect to the NioCorp Assumed Warrants is incorporated herein by reference.
On March 17, 2023, the Company entered into that certain Assignment, Assumption and Amendment Agreement (the “Warrant Assumption Agreement”), by and among NioCorp, GX, Continental Stock Transfer & Trust Company, as existing warrant agent (“CST”), and Computershare Inc. and its affiliate, Computershare Trust Company, N.A., together as successor warrant agent (“Computershare”). Pursuant to the Warrant Assumption Agreement, the Company assumed all of the obligations of GX under and in respect of the Warrant Agreement, dated March 17, 2021, by and between GX and CST (the “GX Warrant Agreement” and, as amended by the Warrant Assumption Agreement, the “Warrant Agreement”), and Computershare was appointed as successor warrant agent under the Warrant Agreement.
The foregoing description of the terms of the Warrant Agreement is subject to, and is qualified in its entirety by, the full text of the GX Warrant Agreement, as amended by the Warrant Assumption Agreement, which are attached as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K, which documents are incorporated by reference in their entirety into this Item 1.01.
| Item 2.01 | Completion of Acquisition or Disposition of Assets. |
The information set forth in the Introductory Note and Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.01.
| Item 3.01 | Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing. |
The information set forth in the Introductory Note of this Current Report on Form 8-K is incorporated by reference into this Item 3.01.
| Item 3.02 | Unregistered Sales of Equity Securities. |
The information set forth in the Introductory Note and Item 1.01 of this Current Report on Form 8-K with respect to the issuance of the Second Merger Class B Shares, the Registration Rights and Lockup Agreement and the Exchange Agreement is incorporated by reference into this Item 3.02.
The offer, issuance and sale of 7,957,404 Second Merger Class B Shares, including the NioCorp Common Shares issuable upon exchange of such Second Merger Class B Shares, in connection with the Mergers was made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act. The offer, issuance and sale of such Second Merger Class B Shares, including the NioCorp Common Shares issuable upon exchange of such Second Merger Class B Shares, was not registered under the Securities Act or any state securities laws and such Second Merger Class B Shares, including the NioCorp Common Shares issuable upon exchange of such Second Merger Class B Shares, may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from the registration requirements of the Securities Act.
| Item 3.03 | Material Modification to Rights of Security Holders. |
As previously disclosed, on March 10, 2023, NioCorp shareholders approved, by ordinary resolution, an amendment (the “Articles Amendment”) to NioCorp’s articles, as amended (the “Articles”), to require the presence, in person or by proxy, of two or more shareholders representing at least 33 1/3% of the outstanding shares entitled to be voted in order to constitute a quorum at any meeting of NioCorp shareholders. Such Articles Amendment was made to satisfy Nasdaq Marketplace Rule 5620(c)’s minimum quorum requirement and became effective following approval by NioCorp’s board of directors (the “Board”) on March 17, 2023.
This summary of the Articles Amendment is qualified in its entirety by reference to the text of such amendment, which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 3.03.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Appointment of Directors to the Board
The information set forth in the Introductory Note and Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 5.02.
Effective immediately upon the Closing, the Board increased the size of the Board to nine members and appointed each of Michael G. Maselli and Dean C. Kehler to the Board, each to hold office until his term expires at the next annual meeting of NioCorp shareholders, and his respective successor is duly elected or appointed and qualified, or until his earlier death, resignation or removal. Messrs. Maselli and Kehler served on the board of directors of GX prior to the Closing. Pursuant to the Business Combination Agreement, the Company was required to cause two directors identified by GX to become directors of the Company as of Closing, and the Board appointed Messrs. Maselli and Kehler to the Board pursuant to such requirement.
As non-employee directors, each of Messrs. Maselli and Kehler will receive compensation in the same manner as the Company’s other non-employee directors and will be eligible to participate in the other non-employee director compensation arrangements described in the Company’s definitive proxy statement on Schedule 14A filed with the SEC on October 10, 2022.
Messrs. Maselli and Kehler are parties to the Registration Rights and Lockup Agreement, as RRA Shareholders thereunder. In addition, certain information related to Messrs. Maselli and Kehler is described in the Joint Proxy Statement/Prospectus under the heading “GX Proposal No. 1 – The Business Combination Proposal––Interests of GX Directors and Officers in the Transactions” beginning on page 109 therein, and such information is incorporated herein by reference.
Indemnification Agreements
The Company expects to enter into indemnification agreements with each of its directors and officers that largely mirror the indemnification rights provided for in its Articles. The Form of Director and Officer Indemnification Agreement is filed as Exhibit 10.4 to this Current Report on Form 8-K and is incorporated by reference into this Item 5.02.
| Item 7.01 | Regulation FD Disclosure. |
The Company announced the completion of the Transactions in a press release issued on March 17, 2023. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. Such exhibit and the information set forth therein shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act.
| Item 8.01 | Other Events. |
Yorkville Convertible Debentures
As previously disclosed, on January 26, 2023, NioCorp entered into a Securities Purchase Agreement (as amended by an Amendment No. 1 to Securities Purchase Agreement, dated February 24, 2023, the “Yorkville Convertible Debt Financing Agreement”) and a Standby Equity Purchase Agreement (the “Yorkville Equity Facility Financing Agreement”) with YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global, LP (together with YA II PN, Ltd., “Yorkville”).
On the Closing Date, NioCorp issued to Yorkville (i) $16.0 million aggregate principal amount of unsecured convertible debentures, convertible into NioCorp Common Shares, and (ii) 1,789,267 warrants to purchase additional NioCorp Common Shares in consideration of $15.36 million in cash funded by Yorkville to NioCorp,
which amount was offset by a payment of $0.5 million of cash from NioCorp to Yorkville as part of a cash fee due in connection with the Closing pursuant to the Yorkville Equity Facility Financing Agreement.
Reverse Stock Split
NioCorp currently has the Registration Statements on Form S-3 (Nos. 333-257195, 333-254511, and 333-260673) and Form S-8 (No. 333-222313) (collectively, the “Registration Statements”) on file with the SEC. SEC regulations permit NioCorp to incorporate by reference future filings made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of the offerings covered by registration statements filed on Form S-3 or Form S-8, as applicable. Pursuant to Rule 416(b) under the Securities Act, as a result of and upon the completion of the reverse stock split, the number of undistributed NioCorp Common Shares deemed to be covered by each of the Registration Statements will be proportionately reduced to a number of NioCorp Common Shares, as applicable, giving effect to the reverse stock split at the ratio of 10-for-1.
| Item 9.01 | Financial Statements and Exhibits. |
(a) Financial statements of businesses acquired.
The Company previously provided the financial statements required by Item 9.01(a) of Form 8-K as Exhibit 99.1 to its Current Report on Form 8-K filed on March 1, 2023.
(b) Pro forma financial information.
The Company previously provided the pro forma financial statements required by Item 9.01(b) of Form 8-K as Exhibit 99.2 to its Current Report on Form 8-K filed on March 1, 2023.
(d) Exhibits.
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.
| NIOCORP DEVELOPMENTS LTD. | ||
| DATE: March 17, 2023 | By: | /s/ Neal S. Shah |
|
Neal S. Shah Chief Financial Officer | ||
Exhibit 3.1
NIOCORP DEVELOPMENTS
(the “Company”)
Extract of Resolutions
ALTERATION TO ARTICLES OF THE COMPANY
Pursuant to section 42(2)(a)(iv) of the Business Corporations Act (British Columbia), the following is an extract of the Ordinary Resolutions of the Shareholders of the Company approved and adopted on March 10, 2023.
BE IT RESOLVED, AS AN ORDINARY RESOLUTION THAT:
| 1. | The NioCorp Articles be amended to delete Section 11.3 and replace it with a new Section 11.3 in the form appended as Annex B to the joint proxy statement/prospectus of NioCorp and GX dated February 8, 2023, to require the presence, in person or by proxy, of two or more shareholders representing at least 33 1/3% of the outstanding shares entitled to be voted in order to constitute a quorum at any meeting of NioCorp Shareholders. |
| 2. | Any one director or officer of NioCorp be and is hereby authorized and directed to do all such acts and things and to executed and deliver all such documents, instruments and assurances as in the opinion of such director or officer may be necessary or desirable to give effect to the foregoing resolutions.” |
AMENDMENT TO ARTICLES OF NIOCORP
QUORUM REQUIREMENT
Current Provision
Section 11.3 of the NioCorp Articles currently states:
“11.3 Quorum
Subject to the special rights and restrictions attached to the shares of any class or series of shares, the quorum for the transaction of business at a meeting of shareholders is one or more persons present and being, or representing by proxy, two or more shareholders entitled to attend and vote at the meeting.”
Amendment
Section 11.3 of the NioCorp Articles is amended by deleting Section 11.3 and replacing with the following:
“11.3 Quorum
Subject to the special rights and restrictions attached to the shares of any class or series of shares, the quorum for the transaction of business at a meeting of shareholders is two or more persons present and being, or representing by proxy, 33 1/3% of the outstanding shares entitled to be voted on at a meeting of shareholders.”
Exhibit 4.2
Execution Version
ASSIGNMENT, ASSUMPTION AND AMENDMENT AGREEMENT
THIS ASSIGNMENT, ASSUMPTION AND AMENDMENT AGREEMENT (this “Agreement”) is made and entered into as of March 17, 2023, by and among (i) GX Acquisition Corp. II, a Delaware corporation (the “SPAC”), (ii) NioCorp Developments Ltd., a company organized under the laws of the Province of British Columbia (the “Company”), (iii) Continental Stock Transfer & Trust Company, a New York corporation, as the existing Warrant Agent (as defined in the Warrant Agreement) (“Continental”), and (iv) Computershare Inc., a Delaware corporation (“Computershare Inc.”) and its affiliate, Computershare Trust Company, N.A., a federally chartered trust company, (“Trust Company,” and together with Computershare Inc., “Computershare”), as the successor Warrant Agent. Capitalized terms used but not otherwise defined herein shall have the respective meanings assigned to such terms in the Warrant Agreement (as defined below) (and if such term is not defined in the Warrant Agreement, then the Business Combination Agreement (as defined below)).
RECITALS
WHEREAS, SPAC and Continental are parties to that certain Warrant Agreement, dated as of March 17, 2021 (as amended, including without limitation by this Agreement, the “Warrant Agreement”), pursuant to which Continental agreed to act as the SPAC’s warrant agent with respect to the issuance, registration, transfer, exchange, redemption and exercise of (i) warrants to purchase ordinary shares of the SPAC issued in SPAC’s initial public offering (“Offering”) (the “Public Warrants”), (ii) warrants to purchase ordinary shares underlying the units of SPAC acquired by GX Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), in a private placement concurrent with the Offering (the “Private Placement Warrants”), and (iii) warrants to purchase ordinary shares issuable to the Sponsor or an affiliate of the Sponsor or certain executive officers and directors of SPAC upon conversion of up to $1,500,000 of working capital loans (the “Working Capital Warrants” and, together with the Public Warrants and the Private Placement Warrants, the “Warrants”);
WHEREAS, on May 26, 2022, (i) SPAC, (ii) the Company, and (iii) Big Red Merger Sub Ltd, a Delaware corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”), entered into a Business Combination Agreement (the “Business Combination Agreement”);
WHEREAS, pursuant to the Business Combination Agreement, upon the consummation of the transactions contemplated thereby, among other matters and subject to the terms and conditions thereof, (a) Merger Sub will merge with and into SPAC, with SPAC surviving the merger (the “First Merger”); (b) all Class A shares in SPAC that are held by shareholders who have not elected to exercise their redemption rights in connection with the transactions contemplated by the Business Combination Agreement and the ancillary agreements related thereto shall be converted into shares of Class A common stock in SPAC (such shares, the “First Merger Class A Shares”), as the surviving company in the First Merger, (c) the Company will purchase all First Merger Class A Shares in exchange for common shares, no par value, of the Company (“Company Common Shares”) (the “Exchange”), (d) the Company will assume the Warrant Agreement and each Warrant that was issued and outstanding immediately prior to the effective time of the Exchange (the “Effective Time”) will be converted into a warrant to acquire Company Common Shares (a “Company Warrant”), (e) all of the First Merger Class A Shares will be contributed by the Company to 0896800 B.C. Ltd., a company organized under the laws of the Province of British Columbia and a direct, wholly owned subsidiary of the Company (“Intermediate Holdco”), in exchange for additional shares of Intermediate Holdco, resulting in SPAC becoming a direct subsidiary of Intermediate Holdco, (f) Elk Creek Resources Corporation, a Nebraska corporation and a direct, wholly owned subsidiary of Intermediate Holdco, will merge with and into SPAC, with SPAC surviving the merger as a direct subsidiary of Intermediate Holdco (the “Second Merger” and, together with the First Merger, the “Mergers”), and (g) following the effective time of the Second Merger, each of the Company and SPAC, as the surviving company of the Second Merger, will effectuate a reverse stock split with the ratio to be mutually agreed by the parties;
WHEREAS, upon consummation of the Mergers, as provided in the Business Combination Agreement and Section 4.4 of the Warrant Agreement, each of the issued and outstanding Warrants will no longer be exercisable for Class A Shares (as defined in the Business Combination Agreement) but instead will be exercisable (subject to the terms and conditions of the Warrant Agreement as amended hereby) for Company Common Shares;
WHEREAS, the Company Common Shares constitute an Alternative Issuance as defined in said Section 4.4 of the Warrant Agreement;
WHEREAS, effective as of the Effective Time, the Company wishes to appoint Computershare to serve as successor Warrant Agent under the Warrant Agreement; and in furtherance of the foregoing the Company has waived, the requirement in Section 8.2.1 of the Warrant Agreement that the successor Warrant Agent be a New York corporation with its principal office in the Borough of Manhattan, City and State of New York;
WHEREAS, in connection with and effective upon such appointment, Continental wishes to assign all its rights, interests and obligations as Warrant Agent under the Warrant Agreement, as hereby amended, to Computershare, Computershare wishes to assume all of such rights, interests and obligations, and the Company wishes to approve such assignment and assumption;
WHEREAS, the board of directors of SPAC has determined that the consummation of the transactions contemplated by the Business Combination Agreement will constitute a Business Combination (as defined in the Warrant Agreement);
WHEREAS, in connection with the Mergers, SPAC desires to assign all of its right, title and interest in the Warrant Agreement to the Company, and the Company wishes to accept such assignment and assume all the liabilities and obligations of SPAC under the Warrant Agreement with the same force and effect as if the Company were initially a party to the Warrant Agreement; and
WHEREAS, Section 9.8 of the Warrant Agreement provides, among other things, that SPAC and the Warrant Agent may amend the Warrant Agreement without the consent of any Registered Holder (i) for the purpose of adding or changing any other provisions with respect to matters or questions arising under the Warrant Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the Registered Holders, and (ii) to provide for the delivery of Alternative Issuance pursuant to Section 4.4.
NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:
1. Assignment and Assumption; Consent.
(a) Assignment and Assumption. SPAC hereby assigns to the Company all of SPAC’s right, title and interest in and to the Warrant Agreement and the Warrants (each as amended hereby) as of the Effective Time. The Company hereby assumes, and agrees to pay, perform, satisfy and discharge in full, as the same become due, all of SPAC’s liabilities and obligations under the Warrant Agreement and the Warrants (each as amended hereby) arising from and after the Effective Time with the same force and effect as if the Company were initially a party to the Warrant Agreement.
(b) Consent. Continental hereby consents to the assignment of the Warrant Agreement and the Warrants by SPAC to the Company and the assumption by the Company of the SPAC’s obligations under the Warrant Agreement pursuant to Section 1(a) hereof effective as of the Effective Time, the assumption of the Warrant Agreement and Warrants by the Company from SPAC pursuant to Section 1(a) hereof effective as of the Effective Time, and to the continuation of the Warrant Agreement and Warrants in full force and effect from and after the Effective Time, subject at all times to the Warrant Agreement and Warrants (each as amended hereby) and to all of the provisions, covenants, agreements, terms and conditions of the Warrant Agreement and this Agreement.
2. Appointment of Successor Warrant Agent. The Company hereby appoints Computershare to serve as successor Warrant Agent under the Warrant Agreement and Continental hereby assigns, and Computershare hereby agrees to accept and assume, effective as of the Effective Time, all of Continental’s rights, interests and obligations in, and under the Warrant Agreement and Warrants, as Warrant Agent; provided, that, Computershare shall not assume any of Continental’s liabilities and obligations under the Warrant Agreement (as amended hereby) arising prior to the Effective Time.
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3. Amendments to Warrant Agreement. The Company and the Warrant Agent hereto hereby agree to the following amendments to the Warrant Agreement, as provided in this Section 3, effective as of the Effective Time. The Company acknowledges and agrees that the amendments to the Warrant Agreement set forth in this Section 3 (i) are necessary and desirable and do not adversely affect the rights of the Registered Holders under the Warrant Agreement in any material respect and (ii) are to provide for the delivery of Alternative Issuance pursuant to Section 4.4 of the Warrant Agreement:
(a) Preamble and References to the “Company, the “Warrant Agent” and the “Transfer Agent”. The preamble of the Warrant Agreement is hereby amended by (i) deleting “GX Acquisition Corp. II, a Delaware corporation” and replacing it with “NioCorp Developments Ltd., a company organized under the laws of the Province of British Columbia” and (ii) deleting “Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agent”, also referred to herein as the “Transfer Agent”)” and replacing it with “Computershare Inc., a Delaware corporation (“Computershare Inc.”), and its affiliate, Computershare Trust Company, N.A., a federally chartered trust company (“Trust Company” and, together with Computershare Inc., in such capacity as warrant agent, the “Warrant Agent”).” As a result thereof, (x) all references to the “Company” in the Warrant Agreement (including all exhibits thereto) shall be amended such that they refer to the Company rather than SPAC, (y) unless the context otherwise requires, all references to the “Warrant Agent” in the Warrant Agreement (including all exhibits thereto) shall be amended such that they refer to Computershare rather than Continental and (z) all references to “Transfer Agent” in the Warrant Agreement (including all exhibits thereto) shall be amended such that they refer to Computershare Investor Services Inc., a corporation incorporated under the laws of Canada, as transfer agent for the Company Common Shares, rather than Continental.
(b) Recitals. The recitals on page one of the Warrant Agreement are hereby deleted and replaced in their entirety as follows:
“WHEREAS, GX Acquisition Corp. II (“GX”) consummated an initial public offering (the “Offering”) of units of GX’s equity securities, each such unit comprised of one share of GX Class A common stock, par value $0.0001 per share (the “GX Common Stock”), and one-third of one redeemable Public Warrant (as defined below) (the “Units”) and, in connection therewith, issued and delivered 10,000,000 warrants to public investors in the Offering (the “Public Warrants”); and
WHEREAS, on March 17, 2021, GX entered into that certain Private Placement Warrants Purchase Agreement with GS Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), pursuant to which the Sponsor agreed to purchase an aggregate of 5,666,667 warrants simultaneously with the closing of the Offering bearing the legend set forth in Exhibit B hereto (the “Private Placement Warrants”) at a purchase price of $1.50 per Private Placement Warrant; and
WHEREAS, in order to finance GX’s transaction costs in connection with an intended initial merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving GX and one or more businesses, the Sponsor or an affiliate of the Sponsor or certain of GX’s executive officers and directors could, but were not obligated to, loan GX funds as GX required, of which up to $1,500,000 of such loans may be convertible into up to an additional 1,000,000 Private Placement Warrants at a price of $1.50 per Private Placement Warrant (the “Working Capital Warrants”); and
WHEREAS, following consummation of the Offering, GX could issue additional warrants (“Post-IPO Warrants” and, collectively with the Private Placement Warrants, the Working Capital Warrants and the Public Warrants, the “GX Warrants”) in connection with, or following the consummation by the GX of, a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving GX and one or more businesses; and
WHEREAS, GX filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-1, File No. 333-253390 (the “Registration Statement”) and prospectus (the “Prospectus”), for the registration, under the Securities Act of 1933, as amended (the “Securities Act”), of the Units, the Public Warrants and the GX Common Stock included in the Units; and
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WHEREAS, on September 25, 2022, (i) GX, (ii) the Company, and (iii) Big Red Merger Sub Ltd, a Delaware corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”), entered into that certain Business Combination Agreement (as it may be amended after the date hereof, the “Business Combination Agreement”) and, as a result, each share of GX Common Stock shall be exchanged for the right to receive 11.1829212 common shares, no par value, of the Company (“Company Common Shares”) (the “Exchange”); and
WHEREAS, pursuant to the Business Combination Agreement and Section 4.4 of this Agreement, immediately after the First Merger Effective Time (as defined in the Business Combination Agreement), each of the issued and outstanding GX Warrants will no longer be exercisable for GX Common Shares but instead will become exercisable (subject to the terms and conditions of this Agreement) for Company Common Shares (each a “Warrant” and, collectively, the “Warrants”); and
WHEREAS, on March 17, 2023, GX, the Company, Continental Stock Transfer & Trust Company, a New York corporation (“Continental”), and the Warrant Agent entered into an Assignment, Assumption and Amendment Agreement to provide for certain amendments to this Agreement, which took effect upon the First Merger Effective Time, (i) to provide for the delivery of an Alternative Issuance pursuant to Section 4.4 and (ii) that were considered necessary or desirable to deal with certain matters related to the Business Combination (as defined in the Business Combination Agreement), including the appointment of the Warrant Agent as successor warrant agent to Continental, and that the parties deemed shall not adversely affect the interest of the Registered Holders; and
WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption and exercise of the Warrants; and
WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and
WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:”
(c) Effect of Countersignature. Section 2.2 of the Warrant Agreement is hereby deleted in its entirety and replaced with the following:
“2.2. Effect of Countersignature. If a physical certificate is issued, unless and until countersigned by either manual or facsimile signature of an authorized signatory of the Warrant Agent, which need not be the same signatory for all of the Warrants, such Warrant certificate shall be invalid and of no effect and may not be exercised by the holder thereof.”
(d) Detachability of Warrants. Section 2.4 of the Warrant Agreement is hereby deleted and replaced with the following: “[INTENTIONALLY OMITTED]”; provided, however, the defined term “Business Day” set forth therein shall be retained for all purposes of the Warrant Agreement (as amended hereby).
(e) Reference to Common Stock. All references to “Common Stock” in the Warrant Agreement (including all exhibits thereto) shall mean Company Common Shares.
(f) Reference to stockholders. All references to “stockholders” in the Warrant Agreement (including all exhibits thereto) shall be deleted and replaced with references to “shareholders”.
(g) Reference to Business Combination. All references to “Business Combination” in the Warrant Agreement (including all exhibits thereto) shall be references to the transactions contemplated by the
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Business Combination Agreement, and references to “the completion of the Business Combination” and all variations thereof in the Warrant Agreement (including all exhibits thereto) shall be references to the closing of the transactions contemplated by the Business Combination Agreement.
(h) Warrant Certificate. Exhibit A to the Warrant Agreement is hereby amended by deleting Exhibit A in its entirety and replacing it with a new Exhibit A attached hereto.
(i) Cashless Exercise. A new subsection 3.3.6 is hereby inserted in the Warrant Agreement as follows:
“3.3.6. Cashless Exercise. In connection with any cashless exercise of Warrants, the Company shall calculate and transmit to the Warrant Agent, and the Warrant Agent shall have no duty under this Agreement to determine, the number of Company Common Shares to be issued on such cashless exercise, and the Warrant Agent shall have no duty or obligation to calculate or confirm whether the Company’s determination of the number of Company Common Shares to be issued on such exercise is accurate.”
(j) Cost Basis. A new subsection 3.3.7 is hereby inserted in the Warrant Agreement as follows:
“3.3.7. Cost Basis.
(a) In the event of a cash exercise, the Company hereby instructs the Warrant Agent to record cost basis for newly issued shares in a manner to be subsequently communicated by the Company in writing to the Warrant Agent.
(b) In the event of a cashless exercise, the Company shall provide cost basis for shares issued pursuant to a cashless exercise at the time the Company confirms the number of Company Common Shares issuable in connection with the cashless exercise to the Warrant Agent pursuant to Section 3.3.1 hereof.”
(k) Notices of Changes in Warrants. Section 4.5 of the Warrant Agreement is hereby amended to add the following immediately after the first full sentence thereof:
“The Warrant Agent shall be entitled to rely on such notice and any adjustment or statement therein contained and shall have no duty or liability with respect thereto and shall not be deemed to have knowledge of any such adjustment or any such event unless and until it shall have received such notice. The Company shall also provide to the Warrant Agent any new or amended exercise terms.”
(l) Form of Warrant. Section 4.7 of the Warrant Agreement is hereby amended by deleting in its entirety “provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed” and replacing it with the following “provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof or, without the Warrant Agent’s prior written consent, the rights, duties, obligations or immunities of the Warrant Agent, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.”
(m) Registration of Transfer. Section 5.1 of the of the Warrant Agreement is hereby amended by:
| i. | deleting the first full sentence thereof and replacing it with the following: “5.1. Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for transfer, in the case of certificated Warrants, properly endorsed with signatures properly guaranteed (which may include any evidence of authority that may be required by the Warrant Agent, including but not limited to, a signature guarantee from an eligible guarantor institution participating in a signature guarantee program approved by the |
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Securities Transfer Association) and accompanied by appropriate instructions for transfer.”; and
| ii. | adding the following immediately after the last full sentence thereof: “The Warrant Agent shall not have any duty or obligation to take any action under any section of this Agreement that requires the payment of taxes and/or charges unless and until it is satisfied that all such payments have been made.” |
(n) Lost, Stolen, Mutilated, or Destroyed Warrants. Section 7.2 of the Warrant Agreement is hereby deleted in its entirety and replaced with the following:
“7.2 Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which may include the receipt by the Warrant Agent of an open penalty surety bond satisfactory to it and holding it and the Company harmless, absent notice to the Warrant Agent that such certificates have been acquired by a bona fide purchaser, and which shall, in the case of a mutilated Warrant, include the surrender thereof) issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed. The Warrant Agent may, at its option, issue replacement Warrants for mutilated certificates upon presentation thereof without such indemnity. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.”
(o) Reservation of Company Common Shares. Section 7.3 of the Warrant Agreement is hereby amended by adding the following immediately after the first full sentence thereof:
“The Company shall provide an opinion of counsel prior to the effective time of the Exchange to set up a reserve of warrants and related Company Common Shares, substantially to the effect that all Warrants or Company Common Shares, as applicable:
| (i) | were offered, sold or issued as part of an offering that was registered in compliance with the Securities Act of 1933, as amended (the “1933 Act”), or pursuant to an exemption from the registration requirements of the 1933 Act; and |
| (ii) | are validly issued, fully paid and non-assessable.” |
(p) Appointment of Successor Warrant Agent. Subsection 8.2.1 of the Warrant Agreement is hereby amended by:
| i. | deleting “sixty (60)” in the first full sentence thereof and replacing it with “thirty (30)”; |
| ii. | deleting “shall be a corporation organized and existing under the laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York” and replacing it with “shall be a corporation or other entity organized and existing under the laws of the United States of America, or any state thereof, in good standing and having its principal office in the United States of America”; and |
| iii. | by inserting “; provided that, such predecessor Warrant Agent shall not be required to make any additional expenditure or assume any additional liability in connection with the foregoing.” at the end of the last full sentence thereof. |
(q) Merger or Consolidation of Warrant Agent. Subsection 8.2.3 of the Warrant Agreement is amended to delete all references to “corporation” and replace them with “entity”.
(r) Remuneration. Subsection 8.3.1 of the Warrant Agreement is hereby deleted in its entirety and replaced with the following:
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“8.3.1. Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder in accordance with a fee schedule to be mutually agreed upon and will reimburse the Warrant Agent upon demand for all of its reasonable and documented expenses (including reasonable and documented counsel fees and expenses) incurred in connection with the preparation, delivery, negotiation, amendment, administration and execution of this Agreement and the exercise and performance of its duties hereunder.”
(s) Reliance on Company Statement. Subsection 8.4.1 of the Warrant Agreement is hereby deleted in its entirety and replaced with the following:
“8.4.1. Reliance on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking, suffering or omitting to take any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the Co-Chief Executive Officer, Chief Financial Officer, President, Executive Vice President, Vice President, Secretary or Co-Chairman of the Board of the Company and delivered to the Warrant Agent; and such certificate shall be full authorization and protection to the Warrant Agent and the Warrant Agent shall incur no liability for or in respect of any action taken, suffered or omitted to be taken by it under the provisions of this Agreement in reasonable reliance upon such certificate. The Warrant Agent shall not be held to have notice of any change of authority of any authorized officer, until receipt of written notice thereof from Company.”
(t) Indemnity. Subsection 8.4.2 of the Warrant Agreement is hereby deleted in its entirety and replaced with the following:
“8.4.2. Indemnity. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liability, loss, damage, judgment, fine, penalty, claim, demand, settlement, cost or expense that is paid, incurred or to which it becomes subject, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent for any action taken, suffered or omitted to be taken by the Warrant Agent in connection with the execution, acceptance, administration, exercise and performance of its duties under this Agreement, including the reasonable costs and expenses of defending against any claim of liability arising therefrom, directly or indirectly, or of enforcing its rights under this Agreement, except as a result of the Warrant Agent’s gross negligence, willful misconduct or bad faith (in each case as determined by a final, non-appealable judgment of a court of competent jurisdiction). The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith (in each case, as determined by a final, non-appealable judgment of a court of competent jurisdiction). Notwithstanding anything to the contrary herein, any liability of the Warrant Agent under this Agreement shall be limited to the amount of fees (but not including any reimbursed costs) paid by the Company to the Warrant Agent during the twelve (12) months immediately preceding the event for which recovery from the Warrant Agent is being sought; provided, that, such liability cap shall not apply to any claims by Registered Holders that arise out of the gross negligence, bad faith or willful misconduct of the Warrant Agent (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction).”
(u) Liability of the Warrant Agent. Section 8.4 of the Warrant Agreement is amended to insert the following new subsections:
“8.4.4. Legal Counsel. The Warrant Agent may consult with legal counsel selected by it (who may be legal counsel for the Company), and the opinion or advice of such counsel shall be full and complete authorization and protection to the Warrant Agent as to any action taken or omitted by it in accordance with such advice or opinion in the absence of Warrant Agent’s bad faith, fraud, gross negligence or willful misconduct (each as must be determined by a final, non-appealable judgment of a court of competent jurisdiction).
8.4.5. Reliance on Agreement and Warrants. The Warrant Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Agreement or in the Warrants (except as to its countersignature thereof) or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Company only.
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8.4.6. No Responsibility as to Certain Matters. The Warrant Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due execution hereof by the Warrant Agent); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant; nor shall it be responsible for any change in the exercisability of the Warrant or any adjustment required under this Agreement or responsible for the manner, method or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any securities to be issued pursuant to this Agreement or any Warrant or as to whether any other securities will, when so issued, be validly authorized and issued, fully paid and non-assessable.
8.4.7. Freedom to Trade in Company Securities. Subject to applicable laws, including U.S. securities laws, the Warrant Agent and any stockholder, director, officer or employee of the Warrant Agent may buy, sell or deal in any of the Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not Warrant Agent under this Agreement. Nothing herein shall preclude the Warrant Agent or any such stockholder, director, officer or employee of the Warrant Agent from acting in any other capacity for the Company or for any other legal entity.
8.4.8. No Risk of Own Funds. No provision of this Agreement shall require the Warrant Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise any of its rights or powers if it shall reasonably believe in the absence of bad faith that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.
8.4.9. No Notice. The Warrant Agent shall not be required to take notice or be deemed to have notice of any event or condition hereunder, including any event or condition that may require action by the Warrant Agent, unless the Warrant Agent shall be specifically notified in writing of such event or condition by the Company, and all notices or other instruments required by this Agreement to be delivered to the Warrant Agent must, in order to be effective, be received by the Warrant Agent as specified in Section 9.2 hereof, and in the absence of such notice so delivered, the Warrant Agent may conclusively assume no such event or condition exists.
8.4.10. Ambiguity. In the event the Warrant Agent believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request or other communication, paper or document received by the Warrant Agent shall seek clarification. If such clarification is not provided within a reasonable amount of time, the Warrant Agent, may, in its sole discretion, refrain from taking any action, and shall be fully protected and shall not be liable in any way to Company, the holder of any Warrant or any other person for refraining from taking such action, unless the Warrant Agent receives written instructions signed by the Company which eliminates such ambiguity or uncertainty to the satisfaction of Warrant Agent.
8.4.11. Non-Registration. The Warrant Agent shall not be liable or responsible for any failure of the Company to comply with any of its obligations relating to any registration statement filed with the Securities and Exchange Commission or this Agreement, including without limitation obligations under applicable regulation or law.
8.4.12. Signature Guarantee. The Warrant Agent may rely on and be fully authorized and protected in acting or failing to act upon (a) any guaranty of signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution for, the foregoing; or (b) any related law, act, regulation or any interpretation of the same.
8.4.13. Reliance on Attorneys and Agents. The Warrant Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by or through its attorneys or agents, and the Warrant Agent shall not be answerable or accountable for any act, omission, default, neglect or misconduct of any such attorneys or agents or for any loss to the Company resulting from any such act, omission, default, neglect or misconduct, absent gross negligence, willful misconduct or bad faith in the selection and continued employment thereof (which gross negligence, willful misconduct or bad faith must be determined by a final, non-appealable judgment of a court of competent jurisdiction).
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8.4.14. Consequential Damages. Neither party to this Agreement shall be liable to the other party for any consequential, indirect, punitive, special or incidental damages under any provisions of this Agreement or for any consequential, indirect, punitive, special or incidental damages arising out of any act or failure to act hereunder even if that party has been advised of or has foreseen the possibility of such damages. For the avoidance of doubt, nothing in this Section 8.4.14 affects the rights of the Registered Holders.”
(v) Acceptance of Agency. Section 8.5 of the Warrant Agreement shall be deleted in its entirety and replaced with the following:
“8.5. Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the express terms and conditions (and no implied terms and conditions) herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all monies received by the Warrant Agent for the subscription for Company Common Shares through the exercise of the Warrants. The Warrant Agent shall act hereunder solely as agent for the Company. The Warrant Agent shall not assume any obligations or relationship of agency or trust with any of the owners or holders of the Warrants or Company Common Shares. The Warrant Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any holder of Warrants or Company Common Shares with respect to any action or default by the Company, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Company. The Warrant Agent shall have no responsibility to the Company, any holders of Warrants, any holders of Company Common Shares or any other person for interest or earnings on any moneys held by the Warrant Agent pursuant to this Agreement.”
| (w) | Survival. Section 8 of the Warrant Agreement shall have a new section inserted as follows: |
“8.7. Survival. The provisions of this Section 8 shall survive the termination of this Agreement, the resignation, replacement or removal of the Warrant Agent and the exercise, termination and expiration of the Warrants.”
(x) Notices. Section 9.2 of the Warrant Agreement is hereby amended by deleting the first sentence in its entirety and replacing it with the following:
“Any notice, statement or demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service after deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:”
Section 9.2 of the Warrant Agreement is hereby further amended to delete the addresses of the Company and the Warrant Agent for notices under the Warrant Agreement and instead add the following addresses for notices to the Company or the Warrant Agent:
If to the Company:
NioCorp Developments Ltd.
7000 South Yosemite Street, Suite 115
Centennial, CO 80112
Attention: Mark Smith and Neal Shah
Email: msmith@niocorp.com and nshah@niocorp.com
with a copy (which will not constitute notice) to:
Jones Day
250 Vesey Street
9
New York, NY 10281
Attention: Joel May and Andrew Thomas
Email: jtmay@jonesday.com and acthomas@jonesday.com
and
Blake, Cassels & Graydon LLP
2600 – 595 Burrard Street
Vancouver, BC V7X 1L3
Attention: Kyle Misewich
Email: kyle.misewich@blakes.com
If to the Warrant Agent:
Computershare Trust Company, N.A.
Computershare Inc.
150 Royal Street
Canton, MA 02021
Attn: Client Services
(y) Examination of the Warrant Agreement. Section 9.5 of the Warrant Agreement is hereby amended by deleting “in the Borough of Manhattan, City and State of New York”.
(z) Counterparts. Section 9.6 of the Warrant Agreement is hereby amended by adding the following immediately after the last full sentence thereof:
“A signature to this Agreement transmitted electronically shall have the same authority, effect, and enforceability as an original signature.”
(aa) Amendments. Section 9.8 of the Warrant Agreement is hereby amended by adding the following immediately after the last full sentence thereof:
“As a condition precedent to the Warrant Agent’s execution of any amendment, the Company shall deliver to the Warrant Agent a certificate from a duly authorized officer of the Company that states that the proposed amendment is in compliance with the terms of this Section 9.8. Notwithstanding anything in this Agreement to the contrary, the Warrant Agent may, but is not obligated to, execute any amendment, supplement or waiver that affects the Warrant Agent’s own rights, duties or immunities under this Agreement. No supplement or amendment to this Agreement shall be effective unless duly executed by the Warrant Agent.”
(bb) Severability. Section 9.9 of the Warrant Agreement is hereby amended by deleting the first full sentence thereof in its entirety and replacing it with the following:
“This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof; provided, however, that if such prohibited and invalid provision shall adversely affect the rights, immunities, liabilities, duties or obligations of the Warrant Agent, the Warrant Agent shall be entitled to resign immediately upon written notice to the Company.”
(cc) Miscellaneous Provisions. Section 9 of the Warrant Agreement is hereby amended by inserting the following new sections:
“9.10. Bank Accounts; Delivery of Exercise Price. All funds received by Computershare under this Agreement that are to be distributed or applied by Computershare in the performance of Services (the “Funds”) shall be held by Computershare as agent for the Company and deposited in one or more bank accounts to be maintained by Computershare in its name as agent for the Company. Until paid pursuant to the terms of this Agreement,
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Computershare will hold the Funds through such accounts in: deposit accounts of commercial banks with Tier 1 capital exceeding $1 billion or with an average rating above investment grade by S&P (LT Local Issuer Credit Rating), Moody’s (Long Term Rating) and Fitch Ratings, Inc. (LT Issuer Default Rating) (each as reported by Bloomberg Finance L.P.). The Warrant Agent shall have no responsibility or liability for any diminution of the Funds that may result from any deposit made by Computershare in accordance with this paragraph, including any losses resulting from a default by any bank, financial institution or other third party. Computershare may from time to time receive interest, dividends or other earnings in connection with such deposits. Computershare shall not be obligated to pay such interest, dividends or earnings to the Company, any holder or any other party. The Warrant Agent shall forward funds received for Warrant exercises in a given month by the 5th business day of the following month by wire transfer to an account designated by the Company.
9.11. Confidentiality. The Warrant Agent and the Company agree that all books, records, information and data pertaining to the business of the other party, including inter alia, personal, non-public warrant holder information, which are exchanged or received pursuant to the negotiation or the carrying out of this Agreement, including the fees for services set forth in a fee schedule to be mutually agreed upon, shall remain confidential, and shall not be voluntarily disclosed to any other person, except as may be required by law, including, without limitation, pursuant to subpoenas from state or federal government authorities (e.g., in divorce and criminal actions).
9.12. Force Majeure. Notwithstanding anything to the contrary contained herein, the Warrant Agent will not be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, terrorist acts, pandemics, epidemics, shortage of supply, disruptions in public utilities, strikes and lock-outs, war or civil unrest.
9.13. Entire Agreement. This Agreement, together with the Warrants, contains the entire agreement and understanding among the parties hereto with respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. Notwithstanding anything to the contrary contained in this Agreement, the express terms of this Agreement control and supersede any provision in the Warrants concerning the rights, duties, obligations, protections, immunities and liability of the Warrant Agent.”
4. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. Execution and delivery of this Agreement by email or exchange of facsimile copies bearing the facsimile signature of a party hereto shall constitute a valid and binding execution and delivery of this Agreement by such party.
5. Successors and Assigns. All covenants and provisions of this Agreement shall bind and inure to the benefit of each party’s respective successors and assigns.
6. Entire Agreement. This Agreement and the Warrant Agreement, as hereby amended, constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof and thereof.
7. Miscellaneous. Except as expressly provided in this Agreement, all of the terms and provisions in the Warrant Agreement are and shall remain in full force and effect, on the terms and subject to the conditions set forth therein. This Agreement does not constitute, directly or by implication, an amendment or waiver of any provision of the Warrant Agreement, or any other right, remedy, power or privilege of any party thereto, except as expressly set forth herein. Any reference to the Warrant Agreement in the Warrant Agreement or any other agreement, document, instrument or certificate entered into or issued in connection therewith, shall hereinafter mean the Warrant Agreement as the case may be, as amended by this Agreement (or as such agreement may be further amended or modified in accordance with the terms thereof). The terms of this Agreement shall be governed by, enforced and construed and interpreted in a manner consistent with the provisions of the Warrant Agreement, as it applies to the amendments to the Warrant Agreement herein, including, without limitation, Section 9 of the Warrant Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, each party hereto has caused this Agreement to be signed and delivered by its respective duly authorized officer as of the date first above written.
| SPAC: | ||
| GX ACQUISITION CORP. II | ||
| By: | /s/ Jay R. Bloom | |
| Name: | Jay R. Bloom | |
| Title: | Co-Chairman and Co-Chief Executive | |
| The Company: | ||
| NIOCORP DEVELOPMENTS LTD. | ||
| By: | /s/ Neal Shah | |
| Name: | Neal Shah | |
| Title: | Chief Financial Officer | |
| Existing Warrant Agent: | ||
| CONTINENTAL STOCK TRANSFER & TRUST COMPANY | ||
| By: | /s/ Erika Young | |
| Name: | Erika Young | |
| Title: | Vice President | |
| Successor Warrant Agent: | ||
|
COMPUTERSHARE INC. COMPUTERSHARE TRUST COMPANY, N.A., as Warrant Agent | ||
| By: | /s/ Collin Ekeogu | |
| Name: | Collin Ekeogu | |
| Title: | Manager, Corporate Actions | |
[Signature Page Assignment, Assumption and Amendment Agreement]
EXHIBIT A
FORM OF WARRANT CERTIFICATE
See attached.
[Form of Warrant Certificate]
[FACE]
Number
Warrants
THIS WARRANT SHALL BE VOID IF NOT EXERCISED PRIOR TO
THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED FOR
IN THE WARRANT AGREEMENT DESCRIBED BELOW
NIOCORP DEVELOPMENTS LTD.
A company organized under the laws of the Province of British Columbia
CUSIP 654484153
Warrant Certificate
This warrant certificate (the “Warrant Certificate”) certifies that , or registered assigns, is the registered holder of warrant(s) evidenced hereby (the “Warrants” and, each, a “Warrant”) to purchase common shares, no par value (“Common Shares”), of NioCorp Developments Ltd., a company organized under the laws of the Province of British Columbia (the “Company”). Each whole Warrant entitles the holder, upon exercise during the period set forth in the Warrant Agreement (as defined below), to receive from the Company that number of fully paid and non-assessable Common Shares as set forth below, at the exercise price (the “Exercise Price”) as determined pursuant to the Warrant Agreement, payable in lawful money (or through “cashless exercise” as provided for in the Warrant Agreement) of the United States of America upon surrender of this Warrant Certificate and payment of the Exercise Price at the office or agency of the Warrant Agent referred to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.
Each whole Warrant is initially exercisable for 11.1829212 fully paid and non-assessable Common Shares. No fractional shares will be issued upon exercise of any Warrant. If, upon the exercise of Warrants, a holder would be entitled to receive a fractional interest in a Common Share, the Company will, upon exercise, round down to the nearest whole number of Common Shares to be issued to the Warrant holder. The number of Common Shares issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.
The initial Exercise Price is equal to $11.50 per 11.1829212 Common Shares. The Exercise Price is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.
Subject to the conditions set forth in the Warrant Agreement, the Warrants may be exercised only during the Exercise Period and, to the extent not exercised by the end of such Exercise Period, such Warrants shall become void.
Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes have the same effect as though fully set forth at this place.
This Warrant Certificate shall not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles thereof.
[Signature Page Follows]
| NIOCORP DEVELOPMENTS LTD. | ||
| By: | ||
| Name: | ||
| Title: | ||
|
COMPUTERSHARE INC. COMPUTERSHARE TRUST COMPANY, N.A., as Warrant Agent | ||
| By: | ||
| Name: | ||
| Title: | ||
[Form of Warrant Certificate]
[Reverse]
The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive Common Shares and are issued or to be issued pursuant to a Warrant Agreement dated as of March 17, 2021, as duly executed and delivered by GX Acquisition Corp. II (“SPAC”) to Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent ( “Continental”), as amended by the Assignment, Assumption and Amendment Agreement, dated as of March 17, 2023, by and among SPAC, Continental, Computershare Inc., a Delaware corporation (“Computershare Inc.”) and its affiliate, Computershare Trust Company, N.A., a federally chartered trust company (“Trust Company” and, together with Computershare Inc., “Computershare”), as successor warrant agent (the “Warrant Agent”), and the Company (as amended, the “Warrant Agreement”), which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders” or “holder” meaning the Registered Holders or Registered Holder, respectively) of the Warrants. Notwithstanding anything to the contrary in this Warrant Certificate, in the event of an inconsistency between the terms of this Warrant Certificate and the Warrant Agreement, the terms of this Warrant Certificate shall prevail; provided, however, that all provisions with respect to the rights, duties, obligations, protections, immunities and liability of the Warrant Agent shall be determined and interpreted solely by the provisions of the Warrant Agreement. A copy of the Warrant Agreement may be obtained by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.
Warrants may be exercised at any time during the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate may exercise them by surrendering this Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Exercise Price as specified in the Warrant Agreement (or through “cashless exercise” as provided for in the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon any exercise of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number of Warrants not exercised.
Notwithstanding anything else in this Warrant Certificate or the Warrant Agreement, no Warrant may be exercised, unless at the time of exercise, (i) a registration statement covering the Common Shares to be issued upon exercise is effective under the Securities Act and (ii) a prospectus thereunder relating to the Common Shares is current, except through “cashless exercise” as provided for in the Warrant Agreement.
The Warrant Agreement provides that, upon the occurrence of certain events, the number of Common Shares issuable upon exercise of the Warrants set forth on the face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be entitled to receive a fractional interest in a Common Share, the Company shall, upon exercise, round down to the nearest whole number of Common Shares to be issued to the holder of the Warrant.
Warrant Certificates, when surrendered at the principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrants.
Upon due presentation for registration of transfer of this Warrant Certificate at the office of the Warrant Agent, a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the Registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a shareholder of the Company.
Election to Purchase
(To Be Executed Upon Exercise of Warrant)
The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to receive Common Shares and herewith tenders payment for such Common Shares to the order of the Company in the amount of $ in accordance with the terms hereof. The undersigned requests that a certificate or book-entry position for such Common Shares be registered in the name of , whose address is and that such Common Shares be delivered to whose address is . If said number of Common Shares is less than all of the Common Shares purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such Common Shares be registered in the name of , whose address is and that such Warrant Certificate be delivered to , whose address is .
In the event that the Warrant has been called for redemption by the Company pursuant to Section 6 of the Warrant Agreement and the Company has required cashless exercise pursuant to Section 6.3 of the Warrant Agreement, the number of Common Shares that this Warrant is exercisable for shall be determined in accordance with subsection 3.3.1(b) and Section 6.3 of the Warrant Agreement.
In the event that the Warrant is a Private Placement Warrant, Working Capital Warrant or Post-IPO Warrant that is to be exercised on a “cashless” basis pursuant to subsection 3.3.1(c) of the Warrant Agreement, the number of Common Shares that this Warrant is exercisable for shall be determined in accordance with subsection 3.3.1(c) of the Warrant Agreement.
In the event that the Warrant is to be exercised on a “cashless basis” pursuant to Section 7.4 of the Warrant Agreement, the number of Common Shares that this Warrant is exercisable for shall be determined in accordance with Section 7.4 of the Warrant Agreement.
In the event that the Warrant may be exercised, to the extent allowed by the Warrant Agreement, through cashless exercise (i) the number of Common Shares that this Warrant is exercisable for would be determined in accordance with the relevant section of the Warrant Agreement which allows for such cashless exercise and (ii) the holder hereof shall complete the following: The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant Agreement, to receive Common Shares. If said number of Common Shares is less than all of the Common Shares purchasable hereunder (after giving effect to the cashless exercise), the undersigned requests that a new Warrant Certificate representing the remaining balance of such Common Shares be registered in the name of , whose address is and that such Warrant Certificate be delivered to , whose address is .
[Signature Page Follows]
| Date: , 20 | |
| (Signature) | |
| (Address) | |
| Signature Guaranteed: | |
| (Tax Identification Number) | |
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO RULE 17Ad-15 (OR ANY SUCCESSOR RULE) UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED).
Exhibit 10.1
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of March 17, 2023, is made and entered into by and among NioCorp Developments Ltd., a corporation incorporated under the laws of the Province of British Columbia (the “Company”), GX Acquisition Corp. II, a Delaware corporation (“GX”), GX Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), certain holders of the common shares of the Company (the “Common Shares”) set forth on Schedule 1 hereto (such shareholders, the “NioCorp Holders”), certain current and former stockholders of GX, and other persons and entities, in each case, set forth on Schedule 2 hereto (collectively, the “Investor Holders” and, collectively with the Sponsor, the NioCorp Holders and any person or entity who hereafter becomes a party to this Agreement pursuant to Section 6.2 of this Agreement, the “Holders” and each, a “Holder”).
RECITALS
WHEREAS, GX and the Sponsor are party to that certain Registration Rights Agreement, dated as of March 17, 2021 (the “Original RRA”);
WHEREAS, the Company, GX and Big Red Merger Sub Ltd, a Delaware corporation and a direct wholly owned subsidiary of the Company (“Merger Sub”) are parties to that certain Business Combination Agreement, dated as of September 25, 2022 (as it may be amended, supplemented or otherwise modified from time to time, the “Merger Agreement”), pursuant to which GX merged with and into the Merger Sub (the “Merger”), with GX surviving the Merger as a direct wholly owned subsidiary of the Company;
WHEREAS, on the date hereof, pursuant to the Merger Agreement, the Sponsor and the Investor Holders received Second Merger Class B Shares (as defined in the Merger Agreement), which are exchangeable into Common Shares;
WHEREAS, on and prior to the date hereof, certain other investors (collectively, the “Third-Party Investor Holders”) purchased an aggregate of $16.0 million principal amount of unsecured debentures convertible into Common Shares and entered into a standby equity purchase agreement to purchase up to $65.0 million of Common Shares in a variable rate facility, each in transactions exempt from registration under the Securities Act;
WHEREAS, pursuant to Section 5.5 of the Original RRA, the provisions, covenants and conditions set forth therein may be amended or modified upon the written consent of GX and the Holders (as defined in the Original RRA) of at least a majority-in-interest of the Registrable Securities (as defined in the Original RRA) at the time in question, and the Sponsor is a Holder in the aggregate of at least a majority-in-interest of the Registrable Securities (as defined in the Original RRA) as of the date hereof; and
WHEREAS, GX and the Sponsor desire to amend and restate the Original RRA in its entirety and enter into this Agreement, pursuant to which the Company shall grant the Holders certain registration rights with respect to certain securities of the Company, as set forth in this Agreement.
NOW, THEREFORE, in consideration of the representations, covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:
ARTICLE
I
DEFINITIONS
1.1 Definitions. The terms defined in this Article I shall, for all purposes of this Agreement, have the respective meanings set forth below:
“Adverse Disclosure” shall mean any public disclosure of material non-public information, which disclosure, in the good faith judgment of the Chief Executive Officer or the Chief Financial Officer of the Company, after consultation with counsel to the Company, (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 untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein (in the case of any prospectus and any preliminary prospectus, in the light of the circumstances under which they were made) not misleading, (b) would not be required to be made at such time if the Registration Statement were not being filed, declared effective or used, as the case may be, and (c) the Company has a bona fide business purpose for not making such information public.
“Agreement” shall have the meaning given in the Preamble hereto.
“Block Trade” shall have the meaning given in Section 2.4.1.
“Board” shall mean the Board of Directors of the Company.
“Canadian Securities Authorities” means the securities regulators or securities regulatory authorities in the provinces and territories of Canada and any of their successors.
“Canadian Securities Laws” means all applicable securities laws in each of the provinces and territories of Canada and the respective rules, regulations, blanket orders and blanket rulings under such laws together with published policies, policy statements and notices of the Canadian Securities Authorities.
“Canadian Shelf Prospectus” shall have the meaning given in Section 2.4.1.
“Closing” shall have the meaning given in the Merger Agreement.
“Closing Date” shall have the meaning given in the Merger Agreement.
“Commission” shall mean the Securities and Exchange Commission.
“Common Shares” shall have the meaning given in the Recitals hereto.
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“Company” shall have the meaning given in the Preamble hereto and includes the Company’s successors by recapitalization, merger, arrangement, amalgamation, consolidation, spin-off, reorganization or similar transaction.
“Competing Registration Rights” shall have the meaning given in Section 6.7.
“Demanding Holder” shall have the meaning given in Section 2.1.4.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as it may be amended from time to time.
“Exchange Agreement” shall have the meaning given to such term in the Merger Agreement.
“Exchange Ratio” shall have the meaning given to such term in the Merger Agreement.
“Form S-1 Shelf” shall have the meaning given in Section 2.1.1.
“Form S-3 Shelf” shall have the meaning given in Section 2.1.1.
“GX Support Agreement” shall have the meaning given to such term in the Merger Agreement.
“Holder Information” shall have the meaning given in Section 4.1.2.
“Holders” shall have the meaning given in the Preamble hereto, for so long as such person or entity holds any Registrable Securities.
“Insider Letter” shall mean that certain letter agreement, dated as of March 17, 2021, by and among GX, the Sponsor and each of the other parties thereto.
“Investor Shares” shall have the meaning given in the Recitals hereto.
“Investor Holders” shall have the meaning given in the Preamble hereto.
“Lock-up” shall have the meaning given in Section 5.1.
“Lock-up Parties” shall mean Sponsor and the NioCorp Holders and their respective Permitted Transferees.
“Lock-up Period” shall mean the period beginning on the Closing Date and ending on the earlier of (i) one year after the Closing and (ii) subsequent to the Closing, (x) the date on which the VWAP of the Common Shares has equaled or exceeded the quotient of $13.42 per share divided by the Exchange Ratio (as adjusted for stock splits (including the Reverse Stock Split), stock dividends, reorganizations, recapitalizations and the like) for 20 trading days within any 30-trading day period commencing at least 150 days after the Closing Date or (y) the date on which the Company completes a liquidation, merger, arrangement, amalgamation, capital stock exchange, reorganization or other similar transaction that results in all of the Company’s shareholders having the right to exchange their Common Shares for cash, securities or other property.
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“Lock-up Shares” shall mean with respect to (i) the Sponsor and its Permitted Transferees, the Common Shares and any other equity securities convertible into or exercisable or exchangeable for Common Shares held by the Sponsor immediately following the Closing (other than Common Shares acquired in the public market) and (ii) the NioCorp Holders and their respective Permitted Transferees, the Common Shares and any other equity securities convertible into or exercisable or exchangeable for Common Shares held by the NioCorp Holders immediately following the Closing (other than Common Shares acquired in the public market).
“Maximum Number of Securities” shall have the meaning given in Section 2.1.5.
“Merger” shall have the meaning given in the Recitals hereto.
“Merger Agreement” shall have the meaning given in the Recitals hereto.
“Merger Sub” shall have the meaning given in the Recitals hereto.
“Minimum Takedown Threshold” shall have the meaning given in Section 2.1.4.
“Misstatement” shall mean an untrue statement of a material fact or an omission to state a material fact required to be stated in a Registration Statement or Prospectus or necessary to make the statements in a Registration Statement or Prospectus (in the case of a Prospectus, in the light of the circumstances under which they were made) not misleading.
“NioCorp Holders” shall have the meaning given in the Preamble hereto.
“Original RRA” shall have the meaning given in the Recitals hereto.
“Other Coordinated Offering” shall have the meaning given in Section 2.4.1.
“Permitted Transferees” shall mean (a) with respect to the Sponsor and its Permitted Transferees, (i) prior to the expiration of the Lock-up Period, any person or entity to whom such Holder is permitted to transfer such Lock-up Shares prior to the expiration of the Lock-up Period pursuant to Section 5.2 and (ii) after the expiration of the Lock-up Period, any person or entity to whom such Holder is permitted to transfer such Lock-up Shares, subject to and in accordance with any applicable agreement between such Holder and/or their respective Permitted Transferees and the Company and any transferee thereafter, including without limitation the Exchange Agreement and the GX Support Agreement; (b) with respect to the NioCorp Holders and their respective Permitted Transferees, (i) prior to the expiration of the Lock-up Period, any person or entity to whom such Holder is permitted to transfer such Lock-up Shares prior to the expiration of the Lock-up Period pursuant to Section 5.2 and (ii) after the expiration of the Lock-up Period, any person or entity to whom such Holder is permitted to transfer such Lock-up Shares, subject to and in accordance with any applicable agreement between such Holder and/or their respective Permitted Transferees and the Company and any transferee thereafter; and (c) with respect to all other Holders and their respective Permitted Transferees, any person or entity to whom such Holder of Registrable Securities is permitted to transfer such Registrable Securities, subject to and in accordance with any applicable agreement between such Holder and/or their respective Permitted Transferees and the Company and any transferee thereafter.
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“Piggyback Registration” shall have the meaning given in Section 2.2.1.
“Private Placement Warrants” shall mean the warrants held by certain Holders, purchased by such Holders in the private placement that occurred concurrently with the closing of GX’s initial public offering, including any Common Shares issued or issuable upon conversion or exchange of such warrants.
“Prospectus” shall mean the prospectus included in any Registration Statement, as supplemented by any and all prospectus supplements and as amended by any and all post-effective amendments and including all material incorporated by reference in such prospectus.
“Registrable Security” shall mean (a) any (i) outstanding Common Shares and other equity securities of the Company and (ii) Common Shares issuable upon the exercise or exchange of any outstanding equity securities of the Company or of another issuer, held by a Holder immediately following the Closing (including any securities distributable pursuant to the Merger Agreement); and (b) any other equity security of the Company or any of its subsidiaries issued or issuable with respect to any securities referenced in clause (a) above by way of a stock dividend or stock split or in connection with a recapitalization, merger, arrangement, amalgamation, consolidation, spin-off, reorganization or similar transaction; provided, however, that, as to any particular Registrable Security, such securities shall cease to be Registrable Securities upon the earliest to occur of: (A) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement by the applicable Holder; (B)(i) such securities shall have been otherwise transferred, (ii) new certificates for such securities not bearing (or book entry positions not subject to) a legend restricting further transfer shall have been delivered by the Company and (iii) subsequent public distribution of such securities shall not require registration under the Securities Act; (C) such securities shall have ceased to be outstanding; (D) such securities may be sold without registration pursuant to Rule 144 or any successor rule promulgated under the Securities Act (but with no volume or other restrictions or limitations including as to manner or timing of sale); and (E) such securities have been sold to, or through, a broker, dealer or underwriter in a public distribution or other public securities transaction.
“Registration” shall mean a registration, including any related Shelf Takedown, effected by preparing and filing a registration statement, Prospectus or similar document in compliance with the requirements of the Securities Act, and the applicable rules and regulations promulgated thereunder, and such registration statement becoming effective.
“Registration Expenses” shall mean the reasonable and documented, out-of-pocket expenses of a Registration, including, without limitation, the following:
(A) all registration and filing fees (including fees with respect to filings required to be made with the Financial Industry Regulatory Authority, Inc.) and any securities exchange on which the Common Shares are then listed;
(B) fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of outside counsel for the Underwriters in connection with blue sky qualifications of Registrable Securities);
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(C) printing, messenger, telephone and delivery expenses;
(D) reasonable fees and disbursements of counsel for the Company;
(E) reasonable fees and disbursements of all independent registered public accountants of the Company incurred specifically in connection with such Registration; and
(F) in an Underwritten Offering or Other Coordinated Offering, reasonable and documented fees and expenses of one (1) legal counsel plus one (1) Canadian legal counsel selected by the majority-in-interest of the Demanding Holders.
“Registration Statement” shall mean any registration statement that covers 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.
“Requesting Holders” shall have the meaning given in Section 2.1.5.
“Reverse Stock Split” shall have the meaning given to such term in the Merger Agreement.
“Securities Act” shall mean the Securities Act of 1933, as amended from time to time.
“Shelf” shall mean the Form S-1 Shelf, the Form S-3 Shelf or any Subsequent Shelf Registration Statement, as the case may be.
“Shelf Registration” shall mean a registration of securities pursuant to a registration statement filed with the Commission in accordance with and pursuant to Rule 415 promulgated under the Securities Act (or any successor rule then in effect).
“Shelf Takedown” shall mean an Underwritten Shelf Takedown or any proposed transfer or sale using a Registration Statement, including a Piggyback Registration.
“Sponsor” shall have the meaning given in the Preamble hereto.
“Sponsor Member” shall mean a member of Sponsor who becomes party to this Agreement as a Permitted Transferee of Sponsor.
“Sponsor Manager” shall mean the managing member of Sponsor, including after the dissolution of Sponsor.
“Subsequent Shelf Registration Statement” shall have the meaning given in Section 2.1.2.
“Third-Party Investor Holders” shall have the meaning given in the Recitals hereto.
“Transfer” shall mean the (a) sale or assignment of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning of Section
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16 of the Exchange Act with respect to, any security, (b) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention to effect any transaction specified in clause (a) or (b).
“Underwriter” shall mean a securities dealer who purchases any Registrable Securities as principal in an Underwritten Offering and not as part of such dealer’s market-making activities.
“Underwritten Offering” shall mean a Registration in which securities of the Company are sold to an Underwriter in a firm commitment underwriting for distribution to the public.
“Underwritten Shelf Takedown” shall have the meaning given in Section 2.1.4.
“VWAP” shall mean, for any security as of any date(s), the dollar volume-weighted average price for such security on the principal securities exchange or securities market on which such security is then traded during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “HP” function (set to weighted average) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported by OTC Markets Group Inc. If the VWAP cannot be calculated for such security on such date(s) on any of the foregoing bases, the VWAP of such security on such date(s) shall be the fair market value per share on such date(s) as reasonably determined by the Company.
“Withdrawal Notice” shall have the meaning given in Section 2.1.6.
ARTICLE
II
REGISTRATIONS AND OFFERINGS
2.1 Shelf Registration.
2.1.1 Filing. As soon as practicable but no later than thirty (30) calendar days following the Closing Date, the Company shall submit to or file with the Commission a Registration Statement for a Shelf Registration on Form S-1 (the “Form S-1 Shelf”) or a Registration Statement for a Shelf Registration on Form S-3 (the “Form S-3 Shelf”), if the Company is then eligible to use a Form S-3 Shelf, in each case, covering the resale of all the Registrable Securities (determined as of a reasonably practicable time prior to such submission or filing) on a delayed or continuous basis and shall use its reasonable best efforts to have such Shelf declared effective as soon as practicable after the filing thereof, but no later than the earlier of (a) the ninetieth (90th) calendar day following the filing date thereof if the Commission notifies the Company that it will “review” the Registration Statement and (b) the tenth (10th) business day after the date the Company is notified (orally or in writing, whichever is earlier) by the Commission that the Registration Statement will not be “reviewed” or will not be subject to further review.
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Such Shelf shall provide for the resale of the Registrable Securities included therein pursuant to any reasonable method or combination of reasonable methods legally available to, and requested by, any Holder named therein. The Company shall maintain a Shelf in accordance with the terms hereof, and shall prepare and file with the Commission such amendments, including post-effective amendments, and supplements as may be necessary to keep a Shelf continuously effective, available for use to permit the Holders named therein to sell their Registrable Securities included therein and in compliance with the provisions of the Securities Act until such time as there are no longer any Registrable Securities. In the event the Company files a Form S-1 Shelf, the Company shall use its reasonable best efforts to convert the Form S-1 Shelf (and any Subsequent Shelf Registration Statement) to a Form S-3 Shelf as soon as practicable after the Company is eligible to use Form S-3. The Company’s obligation under this Section 2.1.1, shall, for the avoidance of doubt, be subject to Section 3.4.
2.1.2 Subsequent Shelf Registration. If any Shelf ceases to be effective under the Securities Act for any reason at any time while Registrable Securities are still outstanding, the Company shall, subject to Section 3.4, use its reasonable best efforts to as promptly as is reasonably practicable cause such Shelf to again become effective under the Securities Act (including using its reasonable best efforts to obtain the prompt withdrawal of any order suspending the effectiveness of such Shelf), and shall use its reasonable best efforts to as promptly as is reasonably practicable amend such Shelf in a manner reasonably expected to result in the withdrawal of any order suspending the effectiveness of such Shelf or file an additional registration statement as a Shelf Registration (a “Subsequent Shelf Registration Statement”) registering the resale of all Registrable Securities (determined as of a reasonably practicable time prior to such filing), and pursuant to any reasonable method or combination of reasonable methods legally available to, and requested by, any Holder named therein. If a Subsequent Shelf Registration Statement is filed, the Company shall use its reasonable best efforts to (i) cause such Subsequent Shelf Registration Statement to become effective under the Securities Act as promptly as is reasonably practicable after the filing thereof (it being agreed that the Subsequent Shelf Registration Statement shall be an automatic shelf registration statement (as defined in Rule 405 promulgated under the Securities Act) if the Company is a well-known seasoned issuer (as defined in Rule 405 promulgated under the Securities Act) at the most recent applicable eligibility determination date) and (ii) keep such Subsequent Shelf Registration Statement continuously effective, available for use to permit the Holders named therein to sell their Registrable Securities included therein and in compliance with the provisions of the Securities Act until such time as there are no longer any Registrable Securities. Any such Subsequent Shelf Registration Statement shall be on Form S-3 to the extent that the Company is eligible to use such form. Otherwise, such Subsequent Shelf Registration Statement shall be on another appropriate form. The Company’s obligation under this Section 2.1.2, shall, for the avoidance of doubt, be subject to Section 3.4.
2.1.3 Additional Registrable Securities. Subject to Section 3.4, in the event that any Holder holds Registrable Securities that are not registered for resale on a delayed or continuous basis, the Company, upon written request of such Holder, shall promptly use its reasonable best efforts to cause the resale of such Registrable Securities to be covered by either, at the Company’s option, any then available Shelf (including by means of a post-effective amendment) or by filing a Subsequent Shelf Registration Statement and cause the same to become effective as soon as practicable after such filing and such Shelf or Subsequent Shelf Registration Statement shall be subject to the terms hereof; provided, however, that the Company shall only be required to cause
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such additional Registrable Securities to be so covered once per calendar year for each of the Sponsor, the NioCorp Holders and the Investor Holders for an aggregate of not more than three (3) additional registrations per calendar year pursuant to this Agreement.
2.1.4 Requests for Underwritten Shelf Takedowns. Subject to Section 3.4, at any time and from time to time when an effective Shelf is on file with the Commission, the Sponsor, an Investor Holder or a NioCorp Holder (any of the Sponsor, an Investor Holder or a NioCorp Holder being in such case, a “Demanding Holder”) may request to sell all or any portion of its Registrable Securities in an Underwritten Offering that is registered pursuant to the Shelf (each, an “Underwritten Shelf Takedown”); provided that the Company shall only be obligated to effect an Underwritten Shelf Takedown if such offering shall include Registrable Securities proposed to be sold by the Demanding Holder, either individually or together with other Demanding Holders, with a total offering price reasonably expected to exceed, in the aggregate, $50 million (the “Minimum Takedown Threshold”). All requests for Underwritten Shelf Takedowns shall be made by giving written notice to the Company, which shall specify the approximate number of Registrable Securities proposed to be sold in the Underwritten Shelf Takedown. Subject to Section 2.4.4, the Company shall have the right to select the Underwriters for such offering (which shall consist of one or more reputable nationally recognized investment banks), subject to the initial Demanding Holder’s prior approval (which shall not be unreasonably withheld, conditioned or delayed). The Sponsor, the Investor Holders and the NioCorp Holders may each demand not more than two (2) Underwritten Shelf Takedowns pursuant to this Section 2.1.4, provided that the Company is not obligated to effect (x) more than three (3) Underwritten Shelf Takedowns per year or (y) an Underwritten Shelf Takedown within ninety (90) days after the closing of a prior Underwritten Shelf Takedown. Notwithstanding anything to the contrary in this Agreement, the Company may effect any Underwritten Offering pursuant to any then effective Registration Statement, including a Form S-3, that is then available for such offering. If the Company shall have filed and obtained a receipt from a Canadian Securities Authorities in one or more Canadian jurisdictions in respect a (final) base shelf prospectus (a “Canadian Shelf Prospectus”) which may validly qualify the offering in such Canadian jurisdictions of the Registrable Securities that the Demanding Holder is requesting to sell pursuant to this Section 2.1.4 at the time such request is made, the Demanding Holder shall be entitled to request that such Canadian Shelf Prospectus also qualify the offering of such Registrable Securities (whether or not same would constitute a “distribution” subject to the prospectus requirement for purposes of applicable Canadian Securities Laws), and, in such instance, the terms and conditions of this Agreement shall apply mutatis mutandis consistent with generally accepted Canadian practice to such Canadian Shelf Prospectus, any supplement thereto and the offering of Registrable Securities thereunder.
2.1.5 Reduction of Underwritten Offering. If the managing Underwriter or Underwriters in an Underwritten Shelf Takedown, in good faith, advises the Company, the Demanding Holders and the Holders requesting piggy back rights pursuant to this Agreement with respect to such Underwritten Shelf Takedown (the “Requesting Holders”) (if any) in writing that the dollar amount or number of Registrable Securities that the Demanding Holders and the Requesting Holders (if any) desire to sell, taken together with all other Common Shares or other equity securities that the Company desires to sell and all other Common Shares or other equity securities, if any, that have been requested to be sold in such Underwritten Offering pursuant to separate written contractual piggy-back registration rights held by any other shareholders, exceeds the maximum dollar amount or maximum number of equity securities that can be sold in the
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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 Company shall include in such Underwritten Offering, before including any Common Shares or other equity securities proposed to be sold by Company or by other holders of Common Shares or other equity securities, the Registrable Securities of (i) first, the Demanding Holders that can be sold without exceeding the Maximum Number of Securities (pro rata based on the respective number of Registrable Securities that each Demanding Holder has requested be included in such Underwritten Shelf Takedown and the aggregate number of Registrable Securities that all of the Demanding Holders have requested be included in such Underwritten Shelf Takedown) and (ii) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (i), the Requesting Holders (if any) (pro rata based on the respective number of Registrable Securities that each Requesting Holder (if any) has requested be included in such Underwritten Shelf Takedown and the aggregate number of Registrable Securities that all of the Requesting Holders have requested be included in such Underwritten Shelf Takedown) that can be sold without exceeding the Maximum Number of Securities.
2.1.6 Withdrawal. Prior to the filing of the applicable “red herring” prospectus or prospectus supplement used for marketing such Underwritten Shelf Takedown, a majority-in-interest of the Demanding Holders initiating an Underwritten Shelf Takedown shall have the right to withdraw from such Underwritten Shelf Takedown for any or no reason whatsoever upon written notification (a “Withdrawal Notice”) to the Company and the Underwriter or Underwriters (if any) of their intention to withdraw from such Underwritten Shelf Takedown; provided that the Sponsor, an Investor Holder or a NioCorp Holder may elect to have the Company continue an Underwritten Shelf Takedown if the Minimum Takedown Threshold would still be satisfied by the Registrable Securities proposed to be sold in the Underwritten Shelf Takedown by the Sponsor, the Investor Holders, the NioCorp Holders or any of their respective Permitted Transferees, as applicable. If withdrawn, a demand for an Underwritten Shelf Takedown shall constitute a demand for an Underwritten Shelf Takedown by the withdrawing Demanding Holder for purposes of Section 2.1.4, unless such Demanding Holder reimburses the Company for all Registration Expenses with respect to such Underwritten Shelf Takedown (or, if there is more than one Demanding Holder, a pro rata portion of such Registration Expenses based on the respective number of Registrable Securities that each Demanding Holder has requested be included in such Underwritten Shelf Takedown); provided that, if the Sponsor, an Investor Holder or a NioCorp Holder elects to continue an Underwritten Shelf Takedown pursuant to the proviso in the immediately preceding sentence, such Underwritten Shelf Takedown shall instead count as an Underwritten Shelf Takedown demanded by the Sponsor, such Investor Holder or such NioCorp Holder, as applicable, for purposes of Section 2.1.4. Following the receipt of any Withdrawal Notice, the Company shall promptly forward such Withdrawal Notice to any other Holders that had elected to participate in such Shelf Takedown. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with a Shelf Takedown prior to its withdrawal under this Section 2.1.6, other than if a Demanding Holder elects to pay such Registration Expenses pursuant to the second sentence of this Section 2.1.6.
2.2 Piggyback Registration.
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2.2.1 Piggyback Rights. Subject to Section 2.4.3, if the Company or any Holder proposes to conduct a registered offering of, or if the Company proposes to file a Registration Statement under the Securities Act with respect to the Registration of, equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into equity securities, for its own account or for the account of shareholders of the Company (or by the Company and by the shareholders of the Company including, without limitation, an Underwritten Shelf Takedown pursuant to Section 2.1), other than a Registration Statement (or any registered offering with respect thereto) (i) contemplated by the separate registration rights agreement and the standby equity purchase agreement, in each case, among the Company and the Third-Party Investor Holders (collectively, the “Third-Party Investor Registration Rights Agreement”), (ii) contemplated by the Warrant Agreement, dated as of March 17, 2021, between the Company and Continental Stock Transfer & Trust Company (the “NioCorp Warrants Registration Obligations”), (iii) filed in connection with any registration rights obligations contemplated by the Fee Reduction Agreement, dated as of September 6, 2022, between GX and Cantor Fitzgerald & Co., the Fee Reduction Agreement, dated as of September 14, 2022, between GX and BTIG, LLC, or any similar arrangements or agreements that GX is party thereto (collectively, the “GX Fee Arrangements”), (iv) contemplated by the Convertible Security Funding Agreement, dated February 26, 2021, between the Company and Lind Global Asset Management III, LLC, as amended (the “Lind Agreement”) (v) filed on Form S-8 or otherwise in connection with any employee stock option or other benefit plan, (vi) pursuant to a Registration Statement on Form S-4 (or similar form that relates to a transaction subject to Rule 145 under the Securities Act or any successor rule thereto), (vii) for an offering of debt that is convertible into equity securities of the Company, (viii) for a dividend reinvestment plan, (ix) a Block Trade or (x) an Other Coordinated Offering, then the Company shall give written notice of such proposed offering to all of the Holders of Registrable Securities as soon as practicable but not less than ten (10) days before the anticipated filing date of such Registration Statement or, in the case of an Underwritten Offering pursuant to a Shelf Registration, the applicable “red herring” prospectus or prospectus supplement used for marketing such offering, which notice shall (A) describe the amount and type of securities intended to be included in such offering, the intended method(s) of distribution, and the name of the proposed managing Underwriter or Underwriters, if any, in such offering, and (B) offer to all of the Holders of Registrable Securities the opportunity to include in such registered offering such number of Registrable Securities as such Holders may request in writing within five (5) days after receipt of such written notice (such registered offering, a “Piggyback Registration”). Subject to Section 2.2.2, the Company shall, in good faith, cause such Registrable Securities to be included in such Piggyback Registration and, if applicable, shall use its reasonable best efforts to cause the managing Underwriter or Underwriters of such Piggyback Registration to permit the Registrable Securities requested by the Holders pursuant to this Section 2.2.1 to be included therein on the same terms and conditions as any similar securities of the Company included in such registered offering and to permit the sale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof. The inclusion of any Holder’s Registrable Securities in a Piggyback Registration shall be subject to such Holder agreement to enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering. If the Company proposes to qualify by way of a Canadian prospectus the distribution of equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into equity securities substantially as contemplated by this Section 2.2.1, Holders of Registrable Securities shall be entitled to request that the offering of such Registrable Securities be qualified
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by way of such Canadian prospectus as if it would constitute a Piggyback Registration and, in such instance, the terms and conditions of this Agreement shall apply mutatis mutandis consistent with generally accepted Canadian practice to the applicable Canadian prospectus, any supplement thereto and the offering of Registrable Securities thereunder.
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 Company and the Holders of Registrable Securities participating in the Piggyback Registration in writing that the dollar amount or number of Common Shares or other equity securities that the Company desires to sell, taken together with (i) the Common Shares or other equity securities, if any, as to which Registration or a registered offering has been demanded pursuant to separate written contractual arrangements with persons or entities other than the Holders of Registrable Securities hereunder, (ii) the Registrable Securities as to which registration has been requested pursuant to Section 2.2 hereof, and (iii) the Common Shares or other equity securities, if any, as to which Registration or a registered offering has been requested pursuant to separate written contractual piggy-back registration rights of persons or entities other than the Holders of Registrable Securities hereunder, exceeds the Maximum Number of Securities, then:
(a) if the Registration or registered offering is undertaken for the Company’s account, the Company shall include in any such Registration or registered offering (A) first, the Common Shares or other equity securities that the Company 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 exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, pro rata, based on the respective number of Registrable Securities that each Holder has requested be included in such Underwritten Offering and the aggregate number of Registrable Securities that the Holders have requested to be included in such Underwritten Offering, 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), the Common Shares or other equity securities, if any, as to which Registration or a registered offering has been requested pursuant to separate written contractual piggy-back registration rights of persons or entities other than the Holders of Registrable Securities hereunder, which can be sold without exceeding the Maximum Number of Securities;
(b) if the Registration or registered offering is pursuant to a demand by persons or entities other than the Holders of Registrable Securities, then the Company shall include in any such Registration or registered offering (A) first, the Common Shares or other equity securities, if any, of such requesting persons or entities, other than the Holders of Registrable Securities, 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 exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, pro rata, based on the respective number of Registrable Securities that each Holder has requested be included in such Underwritten Offering and the aggregate number of Registrable Securities that the Holders have requested to be included in such Underwritten Offering, 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 clauses (A) and (B), the Common Shares or other equity securities that the Company
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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), the Common Shares or other equity securities, if any, as to which Registration or a registered offering has been requested pursuant to separate written contractual piggy-back registration rights of persons or entities other than the Holders of Registrable Securities hereunder, which can be sold without exceeding the Maximum Number of Securities; and
(c) if the Registration or registered offering and Underwritten Shelf Takedown is pursuant to a request by Holder(s) of Registrable Securities pursuant to Section 2.1 hereof, then the Company shall include in any such Registration or registered offering securities in the priority set forth in Section 2.1.5.
2.2.3 Piggyback Registration Withdrawal. Any Holder of Registrable Securities (other than a Demanding Holder, whose right to withdraw from an Underwritten Shelf Takedown, and related obligations, shall be governed by Section 2.1.6) shall have the right to withdraw from a Piggyback Registration for any or no reason whatsoever upon written notification to the Company and the Underwriter or Underwriters (if any) of his, her or its intention to withdraw from such Piggyback Registration prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Piggyback Registration or, in the case of a Piggyback Registration pursuant to a Shelf Registration, the filing of the applicable “red herring” prospectus or prospectus supplement with respect to such Piggyback Registration used for marketing such transaction. The Company (whether on its own good faith determination or as the result of a request for withdrawal by persons or entities pursuant to separate written contractual obligations) may withdraw a Registration Statement filed with the Commission in connection with a Piggyback Registration (which, in no circumstance, shall include a Shelf) at any time prior to the effectiveness of such Registration Statement. Notwithstanding anything to the contrary in this Agreement (other than Section 2.1.6), the Company shall be responsible for the Registration Expenses incurred in connection with the Piggyback Registration prior to its withdrawal under this Section 2.2.3.
2.2.4 Unlimited Piggyback Registration Rights. For purposes of clarity, subject to Section 2.1.6, any Piggyback Registration effected pursuant to Section 2.2 hereof shall not be counted as a demand for an Underwritten Shelf Takedown under Section 2.1.4 hereof.
2.3 Market Stand-off. In connection with any Underwritten Offering of equity securities of the Company (other than a Block Trade or Other Coordinated Offering), if requested by the managing Underwriters, each Holder that is (a) an executive officer, (b) a director or (c) Holder in excess of five percent (5%) of the outstanding Common Shares (and for which it is customary for such a Holder to agree to a lock-up) agrees that it shall not Transfer any Common Shares or other equity securities of the Company (other than those included in such offering pursuant to this Agreement), without the prior written consent of the Company, during the 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 managing Underwriters 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).
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2.4 Block Trades; Other Coordinated Offerings.
2.4.1 Notwithstanding any other provision of this Article II, but subject to Section 3.4, at any time and from time to time when an effective Shelf is on file with the Commission, if a Demanding Holder wishes to engage in (a) an underwritten registered offering not involving a “roadshow,” an offer commonly known as a “block trade” (a “Block Trade”), or (b) an “at the market” or similar registered offering through a broker, sales agent or distribution agent, whether as agent or principal (an “Other Coordinated Offering”), in each case, (x) with a total offering price reasonably expected to exceed $25 million in the aggregate or (y) with respect to all remaining Registrable Securities held by the Demanding Holder, then such Demanding Holder only needs to notify the Company of the Block Trade or Other Coordinated Offering at least ten (10) business days prior to the day such offering is to commence and the Company shall use its reasonable best 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 reasonable best efforts to work with the Company and any Underwriters, brokers, sales agents or placement agents prior to making such request in order to facilitate preparation of the registration statement, prospectus and other offering documentation related to the Block Trade or Other Coordinated Offering.
2.4.2 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 submit a Withdrawal Notice to the Company, the Underwriter or Underwriters (if any) and any brokers, sales agents or placement agents (if any) of their intention to withdraw from such Block Trade or Other Coordinated Offering. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with a Block Trade or Other Coordinated Offering prior to its withdrawal under this Section 2.4.2.
2.4.3 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 this Agreement.
2.4.4 The Demanding Holder in a Block Trade or Other Coordinated Offering shall have the right to select the Underwriters and any brokers, sales agents or placement agents (if any) for such Block Trade or Other Coordinated Offering (in each case, which shall consist of one or more reputable nationally recognized investment banks).
2.4.5 A Demanding Holder in the aggregate may demand no more than two (2) Block Trades or Other Coordinated Offerings pursuant to this Section 2.4 in any twelve (12) month period. For the avoidance of doubt, any Block Trade or Other Coordinated Offering effected pursuant to this Section 2.4 shall not be counted as a demand for an Underwritten Shelf Takedown pursuant to Section 2.1.4 hereof.
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ARTICLE III
COMPANY PROCEDURES
3.1 General Procedures. In connection with any Shelf and/or Shelf Takedown, the Company shall use its reasonable best efforts to effect such Registration to permit the sale of such Registrable Securities in accordance with the intended plan of distribution thereof, and pursuant thereto the Company shall:
3.1.1 prepare and file with the Commission as soon as practicable a Registration Statement with respect to such Registrable Securities and use its reasonable best efforts to cause such Registration Statement to become effective and remain 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 have ceased to be Registrable Securities;
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 any Holder that holds at least five percent (5%) of the Registrable Securities registered on such Registration Statement or any Underwriter of Registrable Securities or as may be required by the rules, regulations or instructions applicable to the registration form used by the Company or by the Securities Act or rules and regulations thereunder to keep the Registration Statement effective until all Registrable Securities covered by such Registration Statement are sold in accordance with the intended plan of distribution set forth in such Registration Statement or supplement to the Prospectus or have ceased to be Registrable Securities;
3.1.3 prior to filing a Registration Statement or Prospectus, or any amendment or supplement thereto, furnish without charge to the Underwriters, if any, and the Holders of Registrable Securities included in such Registration, and such Holders’ legal counsel, copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto and documents incorporated by reference therein), the Prospectus included in such Registration Statement (including each preliminary Prospectus), and such other documents as the Underwriters and the Holders of Registrable Securities included in such Registration or the legal counsel for any such Holders may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Holders; provided that the Company shall have no obligation to furnish any documents publicly filed or furnished with the Commission pursuant to the Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”);
3.1.4 prior to any public offering of Registrable Securities, use its reasonable best efforts to (i) register or qualify the Registrable Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the Holders of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request (or provide evidence satisfactory to such Holders that the Registrable Securities are exempt from such registration or qualification) and (ii) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved by such other governmental authorities as may be necessary by virtue of the business and operations of the Company and do any and all other acts and things that may be necessary or
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advisable to enable the Holders of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Company shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify or take any action to which it would be subject to general service of process or taxation in any such jurisdiction where it is not then otherwise so subject;
3.1.5 cause all such Registrable Securities to be listed on each securities exchange on which similar securities issued by the Company are then listed;
3.1.6 (a) 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, and (b) cooperate reasonably and promptly with the Holders and the transfer agent to effect the removal of any restrictive legends from the Registrable Securities when legally permissible, including delivery, within three (3) business days of request thereof, of any Company instruction letters and opinions of counsel requested by the transfer agent in connection with the removal of any restrictive legends from the Registrable Securities;
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 notify the Holders at any time when a Prospectus relating to such Registration Statement is required to be delivered under the Securities Act, of the happening of any event as a result of which the Prospectus included in such Registration Statement, as then in effect, includes a Misstatement, and then to correct such Misstatement as set forth in Section 3.4;
3.1.9 in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering, or sale by a broker, placement agent or sales agent pursuant to such Registration, permit a representative of the Holders, the Underwriters or other financial institutions facilitating such Underwritten Offering, Block Trade, Other Coordinated Offering or other sale pursuant to such Registration, if any, and any attorney, consultant or accountant retained by such Holders or Underwriter to participate, at each such person’s or entity’s own expense, in the preparation of the Registration Statement, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such representative, Underwriter, financial institution, attorney, consultant or accountant in connection with the Registration; provided, however, that such representatives, Underwriters or financial institutions agree to confidentiality arrangements in form and substance reasonably satisfactory to the Company, prior to the release or disclosure of any such information;
3.1.10 obtain a “cold comfort” letter from the Company’s independent registered public accountants in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration (subject to such broker, placement agent or sales agent providing such certification or representation reasonably requested by the Company’s independent registered public accountants and the
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Company’s counsel) in customary form and covering such matters of the type customarily covered by “cold comfort” letters for a transaction of its type as the managing Underwriter may reasonably request, and reasonably satisfactory to a majority-in-interest of the participating Holders;
3.1.11 in the event of an Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration, on the date the Registrable Securities are delivered for sale pursuant to such Registration, obtain an opinion, dated such date, of counsel representing the Company for the purposes of such Registration, addressed to the participating Holders, the broker, placement agents or sales agent, if any, and the Underwriters, if any, covering such legal matters with respect to the Registration in respect of which such opinion is being given as the participating Holders, broker, placement agent, sales agent or Underwriter may reasonably request and as are customarily included in such opinions and negative assurance letters;
3.1.12 in the event of any Underwritten Offering, a Block Trade, an Other Coordinated Offering or sale by a broker, placement agent or sales agent pursuant to such Registration, enter into and perform its obligations under an underwriting or other purchase or sales agreement, in usual and customary form, with the managing Underwriter or the broker, placement agent or sales agent of such offering or sale;
3.1.13 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 day of the Company’s first full calendar quarter after the effective date of the Registration Statement which satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any successor rule then in effect);
3.1.14 with respect to an Underwritten Offering pursuant to Section 2.1.4, use its reasonable best efforts to make available senior executives of the Company to participate in customary “road show” presentations that may be reasonably requested by the Underwriter in such Underwritten Offering; and
3.1.15 otherwise, in good faith, cooperate reasonably with, and take such customary actions as may reasonably be requested by the participating Holders, consistent with the terms of this Agreement, in connection with such Registration.
Notwithstanding the foregoing, the Company shall not be required to provide any documents or information to an Underwriter, broker, sales agent or placement agent if such Underwriter, broker, sales agent or placement agent has not then been named with respect to the applicable Underwritten Offering or other offering involving a registration as an Underwriter, broker, sales agent or placement agent, as applicable.
3.2 Registration Expenses. The Registration Expenses of all Registrations shall be borne by the Company. It is acknowledged by the Holders that the Holders shall bear all incremental selling expenses relating to the sale of Registrable Securities, such as Underwriters’ commissions and discounts, brokerage fees and, other than as set forth in the definition of “Registration Expenses,” all fees and expenses of any legal counsel representing the Holders.
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3.3 Requirements for Participation in Registration Statement in Offerings. Notwithstanding anything in this Agreement to the contrary, if any Holder does not provide the Company with its Holder Information as requested, the Company may exclude such Holder’s Registrable Securities from the applicable Registration Statement or Prospectus if the Company determines, based on the advice of counsel, that 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. In addition, no person or entity may participate in any Underwritten Offering or other offering for equity securities of the Company pursuant to a Registration initiated by the Company hereunder unless such person or entity (i) agrees to sell such person’s or entity’s securities on the basis provided in any underwriting, sales, distribution or placement arrangements approved by the Company and (ii) completes and executes all customary questionnaires, powers of attorney, indemnities, lock-up agreements, underwriting or other agreements and other customary documents as may be reasonably required under the terms of such underwriting, sales, distribution or placement arrangements. For the avoidance of doubt, the exclusion of a Holder’s Registrable Securities as a result of this Section 3.3 shall not affect the registration of the other Registrable Securities to be included in such Registration.
3.4 Suspension of Sales; Adverse Disclosure; Restrictions on Registration Rights.
3.4.1 Upon receipt of written notice from the Company that a Registration Statement or Prospectus contains a Misstatement, each of the Holders shall forthwith discontinue disposition of Registrable Securities until it has received copies of a supplemented or amended Prospectus correcting the Misstatement (it being understood that the Company hereby covenants to prepare and file such supplement or amendment as soon as reasonably practicable after the time of such notice), or until it is advised in writing by the Company that the use of the Prospectus may be resumed.
3.4.2 Subject to Section 3.4.4, if the filing, initial effectiveness or continued use of a Registration Statement in respect of any Registration at any time would (a) require the Company to make an Adverse Disclosure, (b) require the inclusion in such Registration Statement of financial statements that are unavailable to the Company for reasons beyond the Company’s control, or (c) in the good faith judgment of the majority of the Board such Registration, be detrimental to the Company and the majority of the Board concludes as a result that it is essential to defer such filing, initial effectiveness or continued use at such time, the Company may, upon giving prompt written notice of such action to the Holders (which notice shall not specify the nature of the event giving rise to such delay or suspension), delay the filing or initial effectiveness of, or suspend use of, such Registration Statement for the shortest period of time determined in good faith by the Company to be necessary for such purpose. In the event the Company exercises its rights under this Section 3.4.2, the Holders agree to suspend, immediately upon their receipt of the notice referred to above, their use of the Prospectus relating to any Registration in connection with any sale or offer to sell Registrable Securities until such Holder receives written notice from the Company that such sales or offers of Registrable Securities may be resumed, and in each case maintain the confidentiality of such notice and its contents.
3.4.3 Subject to Section 3.4.4, (a) during the period starting with the date sixty (60) days prior to the Company’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 Company-initiated
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Registration and provided that the Company continues to actively employ, in good faith, all reasonable best efforts to maintain the effectiveness of the applicable Shelf Registration Statement, or (b) if, pursuant to Section 2.1.4, Holders have requested an Underwritten Shelf Takedown and the Company and Holders are unable to obtain the commitment of underwriters to firmly underwrite such offering, the Company may, upon giving prompt written notice of such action to the Holders, delay any other registered offering pursuant to Section 2.1.4 or Section 2.4.
3.4.4 The right to delay or suspend any filing, initial effectiveness or continued use of a Registration Statement pursuant to Section 3.4.2 or a registered offering pursuant to Section 3.4.3 shall be exercised by the Company, in the aggregate, for not more than ninety (90) consecutive calendar days or more than one hundred and twenty (120) total calendar days in each case, during any twelve (12)-month period.
3.5 Reporting Obligations. As long as any Holder shall own Registrable Securities, the Company, at all times while it shall be a reporting company under the Exchange Act, covenants to file timely (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to Sections 13(a) or 15(d) of the Exchange Act and to promptly furnish the Holders with true and complete copies of all such filings; provided that any documents publicly filed or furnished with the Commission pursuant to EDGAR shall be deemed to have been furnished or delivered to the Holders pursuant to this Section 3.5. The Company further covenants that it shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to sell Common Shares held by such Holder without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act (or any successor rule then in effect). Upon the request of any Holder, the Company shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements.
ARTICLE
IV
INDEMNIFICATION AND CONTRIBUTION
4.1 Indemnification.
4.1.1 The Company agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers, directors and agents and each person or entity who controls such Holder (within the meaning of the Securities Act), against all losses, claims, damages, liabilities and out-of-pocket expenses (including, without limitation, reasonable and documented outside attorneys’ fees) resulting from any untrue or alleged untrue statement of material fact contained in or incorporated by reference in any Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as the same are (i) caused by or contained in any information or affidavit so furnished in writing to the Company by such Holder expressly for use therein or (ii) due to the failure of any Holder to furnish Holder Information (as defined below). The Company shall indemnify the Underwriters, their officers and directors and each person or entity to controls such
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Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to the indemnification of the Holder.
4.1.2 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 Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such Registration Statement or Prospectus (the “Holder Information”) and, to the extent permitted by law, shall indemnify the Company, its directors, officers and agents and each person or entity who controls the Company (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and out-of-pocket expenses (including, without limitation, reasonable and documented outside attorneys’ fees) resulting from any untrue or alleged untrue statement of material fact contained or incorporated by reference in any Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement is contained in (or not contained in, in the case of an omission) any information or affidavit so furnished in writing by or on behalf of such Holder expressly for use therein; provided, however, that the obligation to indemnify shall be several, not joint and several, among such Holders of Registrable Securities, and the liability of each such Holder of Registrable Securities shall be in proportion to and limited to the net proceeds received by such Holder from the sale of Registrable Securities pursuant to such Registration Statement. The Holders of Registrable Securities shall indemnify the Underwriters, their officers, directors and each person or entity who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to indemnification of the Company.
4.1.3 Any person or entity entitled to indemnification herein shall (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s or entity’s right to indemnification hereunder to the extent such failure has not materially prejudiced the indemnifying party) and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent shall not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim. No indemnifying party shall, without the consent of the indemnified party, consent to the entry of any judgment or enter into any settlement which cannot be settled in all respects by the payment of money (and such money is so paid by the indemnifying party pursuant to the terms of such settlement) or which settlement includes a statement or admission of fault and culpability on the part of such indemnified party or which settlement does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.
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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 or controlling person or entity of such indemnified party and shall survive the transfer of securities. The Company and each Holder of Registrable Securities participating in an offering also agrees to make such provisions as are reasonably requested by any indemnified party for contribution to such party in the event the Company’s or such Holder’s indemnification is unavailable for any reason.
4.1.5 If the indemnification provided under Section 4.1 from the indemnifying party is unavailable or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities and out-of-pocket expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and out-of-pocket expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, was made by (or not made by, in the case of an omission), or relates to information supplied by (or not supplied by in the case of an omission), such indemnifying party or indemnified party, and the indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action; provided, however, that the liability of any Holder under this Section 4.1.5 shall be limited to the amount of the net proceeds received by such Holder in such offering giving rise to such liability. The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be deemed to include, subject to the limitations set forth in Sections 4.1.1, 4.1.2 and 4.1.3 above, any legal or other fees, charges or out-of-pocket expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.1.5 were determined by pro rata allocation or by any other method of allocation, which does not take account of the equitable considerations referred to in this Section 4.1.5. No person or entity guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this Section 4.1.5 from any person or entity who was not guilty of such fraudulent misrepresentation.
ARTICLE
V
LOCK-UP
5.1 Lock-Up. Subject to Section 5.2, each Lock-up Party agrees that it shall not Transfer any Lock-up Shares prior to the end of the Lock-up Period (the “Lock-up”).
5.2 Permitted Transferees and Other Exceptions.
5.2.1 Notwithstanding the provisions set forth in Section 5.1, each Lock-up Party may Transfer the Lock-up Shares during the Lock-up Period (a) to (i) the Company’s officers or directors, (ii) any affiliates or family members of the Company’s officers or directors, (iii) any direct or indirect partners, members or equity holders of such Lock-up Party, or any related
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investment funds or vehicles controlled or managed by such persons or entities or their respective affiliates, or (iv) any other Lock-up Party or any direct or indirect partners, members or equity holders of such other Lock-up Party, any affiliates of such other Lock-up Party or any related investment funds or vehicles controlled or managed by such persons or entities or their respective affiliates; (b) in the case of an individual, by gift to a member of the individual’s immediate family or to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person or entity, or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) to the partners, members or equity holders of such Lock-up Party by virtue of the Lock-up Party’s organizational documents, as amended, upon dissolution of the Lock-up Party; (f) in connection with any bona fide mortgage, encumbrance or pledge to a financial institution in connection with any bona fide loan or debt transaction or enforcement thereunder; (g) to the Company; or (h) in connection with a liquidation, merger, arrangement, amalgamation, stock exchange, reorganization, tender offer approved by the Board or a duly authorized committee thereof or other similar transaction which results in all of the Company’s shareholders having the right to exchange their Common Shares for cash, securities or other property subsequent to the Closing Date. The parties acknowledge and agree that any Permitted Transferee of a Lock-up Party shall be subject to the transfer restrictions set forth in this ARTICLE V with respect to the Lock-Up Shares upon and after acquiring such Lock-Up Shares.
5.2.2 Notwithstanding the provisions set forth in Section 5.1, each Lock-up Party may Transfer the Lock-up Shares during the Lock-up Period in connection with (a) the establishment of a trading plan pursuant to Rule 10b5-1 under the Exchange Act (provided, however, that such plan does not provide for the transfer of the Lock-up Shares during the Lock-up Period) or (b) transfers to satisfy tax withholding obligations in connection with the exercise of rights to purchase Common Shares or the vesting of stock-based awards, including without limitation, sell-to-cover transactions.
5.3 Termination of Existing Lock-Up. The lock-up provisions in this ARTICLE V shall supersede the lock-up provisions contained in Section 7 of the Insider Letter, which provisions in Section 7 of the Insider Letter shall be of no further force or effect as of the date of this Agreement.
ARTICLE
VI
MISCELLANEOUS
6.1 Notices. Any notice or communication under this Agreement must be in writing and given by (i) deposit in the United States mail, addressed to the party to be notified, postage prepaid and registered or certified with return receipt requested, (ii) delivery in person or by courier service providing evidence of delivery, or (iii) transmission by hand delivery, electronic mail or facsimile. Each notice or communication that is mailed, delivered, or transmitted in the manner described above shall be deemed sufficiently given, served, sent, and received, in the case of mailed notices, on the third business day following the date on which it is mailed and, in the case of notices delivered by courier service, hand delivery, electronic mail or facsimile, at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger) or at such time as delivery is refused by the addressee upon presentation. Any notice or communication under
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this Agreement must be addressed, if to the Company, to: NioCorp Developments Ltd., 7000 South Yosemite Street, Suite 115, Centennial, Colorado 80112, Attention: Mark Smith, and, if to any Holder, at such Holder’s address, electronic mail address or facsimile number as set forth in the Company’s books and records. Any party may change its address for notice at any time and from time to time by written notice to the other parties hereto, and such change of address shall become effective five (5) business days after delivery of such notice as provided in this Section 6.1.
6.2 Assignment; No Third Party Beneficiaries.
6.2.1 This Agreement and the rights, duties and obligations of the Company hereunder may not be assigned or delegated by the Company in whole or in part.
6.2.2 Subject to Section 6.2.4 and Section 6.2.5, this Agreement and the rights, duties and obligations of a Holder hereunder may be assigned in whole or in part to such Holder’s Permitted Transferees to which it transfers Registrable Securities; provided that with respect to the NioCorp Holders, the Investor Holders and the Sponsor, the rights hereunder that are personal to such Holders may not be assigned or delegated in whole or in part, except that (i) each of the NioCorp Holders shall be permitted to transfer its rights hereunder as the NioCorp Holders to one or more affiliates or any direct or indirect partners, members or equity holders of such NioCorp Holder (it being understood that no such transfer shall reduce or multiply any rights of such NioCorp Holder or such transferees), (ii) each of the Investor Holders shall be permitted to transfer its rights hereunder as the Investor Holders to one or more affiliates or any direct or indirect partners, members or equity holders of such Investor Holder (it being understood that no such transfer shall reduce or multiply any rights of such Investor Holder or such transferees) and (iii) the Sponsor shall be permitted to transfer its rights hereunder as the Sponsor to one or more affiliates or any direct or indirect partners, members or equity holders of the Sponsor (including the Sponsor Members), which, for the avoidance of doubt, shall include a transfer of its rights in connection with a distribution of any Registrable Securities held by Sponsor to its members (it being understood that no such transfer shall reduce or multiply any rights of the Sponsor or such transferees). Upon a transfer by the Sponsor pursuant to subsection (iii) to the Sponsor Members, the rights that are personal to the Sponsor shall be exercised by the Sponsor Members only with the consent of the Sponsor Manager.
6.2.3 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.
6.2.4 This Agreement shall not confer any rights or benefits on any persons or entities that are not parties hereto, other than as expressly set forth in this Agreement.
6.2.5 No assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate the Company unless and until the Company shall have received (i) written notice of such assignment as provided in Section 6.1 hereof and (ii) the written agreement of the assignee, in a form reasonably satisfactory to the Company, 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, including the joinder in the form of
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Exhibit A attached hereto). Any transfer or assignment made other than as provided in this Section 6.2 shall be null and void.
6.3 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.
6.4 Governing Law; Venue. NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT (1) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK AND (2) THE VENUE FOR ANY ACTION TAKEN WITH RESPECT TO THIS AGREEMENT SHALL BE ANY STATE OR FEDERAL COURT IN NEW YORK COUNTY IN THE STATE OF NEW YORK
6.5 TRIAL BY JURY. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND, THEREFORE, EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
6.6 Amendments and Modifications. This Agreement may be amended or modified, and compliance with any of the provisions, covenants and conditions set forth herein may be waived, upon the written consent of (a) the Company and (b) the Holders of a majority of the total Registrable Securities then outstanding; provided, however, that notwithstanding the foregoing, any amendment hereto or waiver hereof shall also require the written consent of the Sponsor Manager so long as the Sponsor or its Permitted Transferees hold any Registrable Securities; provided, further, that any amendment hereto or waiver hereof that adversely affects any Holder, solely in its capacity as a holder of the shares of capital stock of the Company, in a manner that is materially different from the other Holders (in such capacity) shall require the consent of the Holder so affected. No course of dealing between any Holder or the Company and any other party hereto or any failure or delay on the part of a Holder or the Company in exercising any rights or remedies under this Agreement shall operate as a waiver of any rights or remedies of any Holder or the Company. No single or partial exercise of any rights or remedies under this Agreement by a party shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder or thereunder by such party.
6.7 Other Registration Rights. Other than (i) the Third-Party Investor Registration Rights Agreement; (ii) the NioCorp Warrants Registration Obligations; (iii) any registration rights obligations contemplated by the GX Fee Arrangements; and (iv) the Lind Agreement, the Company represents and warrants that no person or entity, other than a Holder of Registrable Securities, has any right to require the Company to register any securities of the Company for sale or to include such securities of the Company in any Registration Statement filed by the Company for the sale of securities for its own account or for the account of any other person or entity. The
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Company hereby agrees and covenants that it will not grant rights to register any Common Shares (or securities convertible into or exchangeable for Common Shares) pursuant to the Securities Act that are more favorable or senior to those granted to the Holders hereunder without (a) the prior written consent of the Sponsor Manager, for so long as the Sponsor or its Permitted Transferees hold any Registrable Securities or (b) granting economically and legally equivalent rights to the Holders hereunder such that the Holders shall receive the benefit of such more favorable or senior terms and/or conditions. Further, the Company and each Holder represents and warrants that this Agreement supersedes any other registration rights agreement or other agreement with any Holders having similar terms and conditions, and in the event of a conflict between any such agreement and this Agreement, the terms of this Agreement shall prevail.
6.8 Term. This Agreement shall terminate on the earlier of (a) the tenth (10th) anniversary of the date of this Agreement and (b) with respect to any Holder, on the date that such Holder no longer holds any Registrable Securities. The provisions of Section 3.5 and Article IV shall survive any termination.
6.9 Holder Information. Each Holder agrees, if requested in writing, to represent to the Company the total number of Registrable Securities held by such Holder in order for the Company to make determinations hereunder.
6.10 Severability. It is the desire and intent of the parties that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.
6.11 Entire Agreement; Restatement. This Agreement constitutes the full and entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter. Upon the Closing, the Original RRA shall no longer be of any force or effect.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the date first written above.
| COMPANY: | ||
| NioCorp Developments Ltd. | ||
| a corporation incorporated under the laws of the Province of British Columbia | ||
| By: | /s/ Neal Shah | |
| Name: Neal Shah | ||
| Title: Chief Financial Officer | ||
| GX Acquisition Corp. II | ||
| a Delaware corporation | ||
| By: | /s/ Jay R. Bloom | |
| Name: Jay R. Bloom | ||
| Title: Co-Chairman and Co-Chief Executive Officer | ||
[Signature Page to Amended and Restated Registration Rights Agreement]
| HOLDERS: | ||
| GX Sponsor II LLC | ||
| a Delaware limited liability company | ||
By: Cooper Road, LLC, as Managing Member | ||
| By: | /s/ Jay R. Bloom | |
| Name: Jay R. Bloom | ||
| Title: Managing Member | ||
| By: | /s/ Dean C. Kehler | |
| Name: Dean C. Kehler | ||
| Title: Managing Member |
[Signature Page to Amended and Restated Registration Rights Agreement]
| BTIG, LLC | ||
| By: | /s/ Brian K. Endres | |
| Name: Brian K. Endres | ||
| Title: Chief Financial Officer | ||
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Mark A. Smith | |
| Mark A. Smith |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Neal Shah | |
| Neal Shah |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Scott Honan | |
| Scott Honan |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Jim Sims | |
| Jim Sims |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Michael J. Morris | |
| Michael J. Morris |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ David C. Beling | |
| David C. Beling |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Anna Castner Wightman | |
| Anna Castner Wightman |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Fernanda Fenga | |
| Fernanda Fenga |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Nilsa Guerrero-Mahon | |
| Nilsa Guerrero-Mahon |
[Signature Page to Amended and Restated Registration Rights Agreement]
| /s/ Peter Oliver | |
| Peter Oliver |
[Signature Page to Amended and Restated Registration Rights Agreement]
Schedule 1
NioCorp Holders
Mark A. Smith
Neal Shah
Scott Honan
Jim Sims
Michael J. Morris
David C. Beling
Anna Castner Wightman
Fernanda Fenga
Nilsa Guerrero-Mahon
Peter Oliver
Schedule 2
Investor Holders
GX Sponsor II LLC
BTIG, LLC
Exhibit A
REGISTRATION RIGHTS AGREEMENT JOINDER
The undersigned is executing and delivering this joinder (this “Joinder”) pursuant to the Amended and Restated Registration Rights Agreement, dated as of March 17, 2023 (as the same may hereafter be amended, the “Registration Rights Agreement”), among NioCorp Developments Ltd., a corporation incorporated under the laws of the Province of British Columbia (the “Company”), and the other persons or entities named as parties therein. Capitalized terms used but not otherwise defined herein shall have the meanings provided in the Registration Rights Agreement.
By executing and delivering this Joinder to the Company, and upon acceptance hereof by the Company upon the execution of a counterpart hereof, the undersigned hereby agrees to become a party to, to be bound by, and to comply with the Registration Rights Agreement as a Holder of Registrable Securities in the same manner as if the undersigned were an original signatory to the Registration Rights Agreement, and the undersigned’s Common Shares and other equity securities of the Company shall be included as Registrable Securities under the Registration Rights Agreement to the extent provided therein.
Accordingly, the undersigned has executed and delivered this Joinder as of the __________ day of __________, 20__.
| Signature of Stockholder | ||
| Print Name of Stockholder | ||
| Its: | ||
| Address: | ||
Agreed and Accepted as of
____________, 20__
NioCorp Developments Ltd.
By: __________________________
Name:
Its:
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT JOINDER
March 17, 2023
Each of Dean Kehler and Cooper Road, LLC (each a “Major Sponsor Holder” and, together, the “Major Sponsor Holders”) and the other parties listed on Schedule A attached hereto (each, including the Major Sponsor Holders, a “Sponsor Holder,” and collectively, the “Sponsor Holders”), severally and not jointly, is executing and delivering this joinder (this “Joinder”) pursuant to the Amended and Restated Registration Rights Agreement, dated as of March 17, 2023 (as the same may hereafter be amended, restated, supplemented or otherwise modified, the “Registration Rights Agreement”), by and among NioCorp Developments Ltd. (the “Company”), GX Acquisition Corp. II, GX Sponsor II LLC, a Delaware limited liability company (the “Sponsor”), and the other persons or entities named as parties therein. Capitalized terms used but not otherwise defined herein shall have the meanings provided in the Registration Rights Agreement.
By executing and delivering this Joinder to the Company, and upon acceptance hereof by the Company upon the execution of a counterpart hereof, each Sponsor Holder hereby agrees, severally but not jointly, to become a party to, to be bound by, and to comply with the Registration Rights Agreement as a “Holder of Registrable Securities” in the same manner as if such Sponsor Holder were an original signatory to the Registration Rights Agreement (and shall also constitute a “Sponsor Member” and a “Permitted Transferee” of the Sponsor under the Registration Rights Agreement), and any and all Common Shares, warrants and any other securities of the Company (collectively, the “New Securities”) distributed (each such distribution, a “Distribution”) to each Sponsor Holder on or after the date hereof shall be included as, and shall constitute, Registrable Securities under the Registration Rights Agreement, and any such Distribution shall not result in the New Securities ceasing to be Registrable Securities.
Pursuant to Section 6.2.2 of the Registration Rights Agreement, the Sponsor hereby unconditionally transfers, assigns, conveys and delivers to the Sponsor Holders, and each Sponsor Holder hereby unconditionally acquires, accepts and assumes, severally and not jointly, all of the rights of the “Sponsor” set forth in the Registration Rights Agreement with respect to, and to the extent of, such Sponsor Holder’s New Securities, and each Sponsor Holder shall be considered the “Sponsor” for purposes of the Registration Rights Agreement with respect to, and to the extent of, such Sponsor Holder’s New Securities, subject to the further clarifications that:
| (i) | for purposes of Section 2.1.3 of the Registration Rights Agreement, the limitation in the proviso thereof shall apply to the Sponsor (to the extent it remains in existence after a Distribution) and the Sponsor Holders, measured collectively; |
| (ii) | for purposes of the third to last sentence of Section 2.1.4 of the Registration Rights Agreement and for purposes of Section 2.4.5 of the Registration Rights Agreement, the limitation shall apply to the Sponsor (to the extent it remains in existence after a Distribution) and the Sponsor Holders, measured collectively; |
| (iii) | for purposes of Section 3.1.2 of the Registration Rights Agreement, the percentage shall apply to the Sponsor (to the extent it remains in existence after a Distribution) and the Sponsor Holders, measured collectively; and |
| (iv) | the Sponsor (to the extent it remains in existence after a Distribution) and the Sponsor Holders each shall be included in the definition of “Demanding Holder”; |
provided, that (1) the Sponsor and each of the Sponsor Holders agree that, without the consent of the Major Sponsor Holders, only the Major Sponsor Holders may initiate the rights provided to the Sponsor and the Sponsor Holders pursuant to Section 2.1.3, Section 2.1.4 and Section 2.4.5 of the Registration Rights Agreement and only the Major Sponsor Holders may initiate an Underwritten Shelf Takedown, a Block Trade or an Other Coordinated Offering as a Demanding Holder, and (y) this Joinder shall not modify, limit or otherwise affect any rights of the Sponsor Manager under the Registration Rights Agreement, including in Sections 6.2.2, 6.6 and 6.7 of the Registration Rights Agreement.
[signature pages follow]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:_/s/ James W. Harpel___________
Name: James W. Harpel
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:/s/ Arthur Baer________________
Name: Arthur Baer
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
EQUITY TRUST COMPANY
CUSTODIAN FBO ARTHUR D. BAER ROTH IRA
By:/s/ Arthur Baer________________
Name: Arthur Baer
Title: Authorized Signatory
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:/s/ Andrea J. Kellett____________
Name: Andrea J. Kellett
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
HW 2015 Trust U/A 7/23/15
By:_/s/ Elaine Weinberger_________
Name: Elaine Weinberger, Trustee
Title: Authorized Signatory
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
COOPER ROAD, LLC
By:/s/ Jay R. Bloom______________
Name: Jay R. Bloom
Title: Managing Member
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:/s/ Jordan S. Bloom____________
Name: Jordan S. Bloom
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
COOPER ROAD ACQUISITION, LLC
By:_/s/ Jordan S. Bloom___________
Name: Jordan S. Bloom
Title: Sole Member
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
ELIZABETH KEHLER 2012 TRUST
By:_/s/ Dean C. Kehler____________
Name: Dean C. Kehler
Title: Co-Trustee, Authorized
Signatory
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:_/s/ Dean C. Kehler____________
Name: Dean C. Kehler
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:_/s/ Michael G. Maselli__________
Name: Michael G. Maselli
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
By:_/s/ Marc Mazur_______________
Name: Marc Mazur
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
AJA PARTNERS LLC
By:_/s/ Leon Wagner______________
Name: Leon Wagner
Title: Manager
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
CORBIN ERISA OPPORTUNITY FUND, LTD.
By: Corbin Capital Partners, L.P., its Investment Manager
By:_/s/ Daniel Friedman___________
Name: Daniel Friedman
Title: General Counsel
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
ACM ALAMEDA SPECIAL PURPOSE INVESTMENT FUND II LP
By:_/s/ Ivan Zinn_________________
Name: Ivan Zinn
Title: Authorized Signatory
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
CORBIN OPPORTUNITY FUND, L.P.
By: Corbin Capital Partners, L.P., its Investment Manager
By: /s/ Daniel Friedman___________
Name: Daniel Friedman
Title: General Counsel
[Signature Page to Registration Rights Agreement Joinder]
Accordingly, the undersigned have executed and delivered this Joinder as of the date first written above.
ATALAYA SPECIAL PURPOSE INVESTMENT FUND II L.P.
By:_/s/ Ivan Zinn_________________
Name: Ivan Zinn
Title: Authorized Signatory
[Signature Page to Registration Rights Agreement Joinder]
|
Agreed and Accepted:
|
| NioCorp Developments Ltd. |
|
|
| By: _/s/ Neal Shah_________________ |
|
Name: Neal Shah Title: Chief Financial Officer |
[Signature Page to Registration Rights Agreement Joinder]
Schedule A
| 1. | Cooper Road, LLC |
| 2. | Cooper Road Acquisition, LLC |
| 3. | Dean C. Kehler |
| 4. | Elizabeth Kehler 2012 Trust |
| 5. | Michael G. Maselli |
| 6. | Jordan S. Bloom |
| 7. | Andrea J. Kellett |
| 8. | Arthur Baer |
| 9. | Equity Trust Company Custodian FBO Arthur D. Baer ROTH IRA |
| 10. | James Harpel |
| 11. | HW 2015 Trust u/a 7/23/15, Elaine Weinberger, Trustee |
| 12. | Marc Mazur |
| 13. | AJA Partners LLC |
| 14. | Atalaya Special Purpose Investment Fund II L.P. |
| 15. | ACM Alameda Special Purpose Investment Fund II LP |
| 16. | Corbin ERISA Opportunity Fund, Ltd. |
| 17. | Corbin Opportunity Fund, L.P. |
Exhibit 10.3
EXECUTION VERSION
EXCHANGE AGREEMENT
BY AND AMONG
NIOCORP DEVELOPMENTS LTD.,
ELK CREEK RESOURCES CORP. (F/K/A GX ACQUISITION CORP. II) AND
GX SPONSOR II LLC
Dated as of March 17, 2023
TABLE OF CONTENTS
| Page | ||
| ARTICLE I DEFINITIONS | 1 | |
| Section 1.1 | Definitions | 1 |
| Section 1.2 | Terms Generally | 5 |
| ARTICLE II EXCHANGE RIGHT | 6 | |
| Section 2.1 | Exchange Right | 6 |
| Section 2.2 | Exchange Right Procedures | 6 |
| Section 2.3 | Exchange Payment. | 7 |
| ARTICLE III EXCHANGE RATIO | 8 | |
| Section 3.1 | Exchange Ratio; Adjustment of Exchange Ratio | 8 |
| ARTICLE IV SUPPORT | 8 | |
| Section 4.1 | Taxes | 8 |
| Section 4.2 | No Effect on Agreement | 8 |
| Section 4.3 | Continuing Agreement | 9 |
| Section 4.4 | Reservation of Shares | 9 |
| Section 4.5 | Dilutive Actions; Issuances; Shareholder Rights; Fundamental Transactions. | 9 |
| Section 4.6 | Government Authority Approval | 12 |
| Section 4.7 | Limited Proxy | 12 |
| ARTICLE V REPRESENTATIONS AND WARRANTIES | 12 | |
| Section 5.1 | Representations and Warranties of the Company | 12 |
| Section 5.2 | Representations and Warranties of the Exchanging Shareholders | 13 |
| ARTICLE VI SECURITIES LAW MATTERS | 13 | |
| Section 6.1 | Securities Law Transfer Restrictions | 13 |
| Section 6.2 | Shareholder Register and Notation. | 14 |
| Section 6.3 | Supplemental Listing | 15 |
| ARTICLE VII MISCELLANEOUS | 15 | |
| Section 7.1 | The Company’s Waivers | 15 |
| Section 7.2 | Election of Remedies | 15 |
| Section 7.3 | Effect of Delay or Omission to Pursue Remedy | 15 |
| Section 7.4 | Termination | 16 |
| Section 7.5 | Governing Law; Venue; Waiver of Jury Trial. | 16 |
| Section 7.6 | Assignment | 17 |
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TABLE OF CONTENTS
(Continued)
| Page | ||
| Section 7.7 | Specific Performance | 17 |
| Section 7.8 | Amendment | 18 |
| Section 7.9 | Severability | 18 |
| Section 7.10 | Notices | 18 |
| Section 7.11 | Counterparts | 19 |
| Section 7.12 | Entire Agreement | 19 |
EXHIBITS
EXHIBIT A – Form of Exchange Notice
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EXCHANGE AGREEMENT
This Exchange Agreement (this “Agreement”) is dated as of March 17, 2023, by and among NioCorp Developments Ltd., a company incorporated under the laws of the Province of British Columbia (the “Company”), Elk Creek Resources Corp. (f/k/a GX Acquisition Corp. II), a Delaware corporation (“GX”), and GX Sponsor II LLC (together with its Permitted Transferees (as defined herein), each an “Exchanging Shareholder” and, collectively, the “Exchanging Shareholders”).
RECITALS
WHEREAS, this Agreement is entered into in connection with the consummation of the transactions contemplated by the Business Combination Agreement, dated as of September 25, 2022, by and among GX, the Company and Big Red Merger Sub Ltd, a Delaware corporation and a direct, wholly owned subsidiary of the Company (such transactions being the “Transactions”).
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein, and intending to be legally bound hereby, the parties hereto agree as follows:
ARTICLE
I
DEFINITIONS
Section 1.1 Definitions. Capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Articles. 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 1.1 or elsewhere in this Agreement:
“Agreement” has the meaning specified in the introduction.
“Appraiser FMV” means the fair market value of any Common Share as determined by an independent appraiser mutually agreed upon by GX and the relevant Exchanging Shareholder, whose determination shall be final and binding for those purposes for which Appraiser FMV is used in this Agreement. Appraiser FMV shall mean the value that would be obtained in an arms-length transaction between an informed and willing buyer and an informed and willing seller, neither of whom is under any compulsion to buy or sell, respectively, and without regard to the particular circumstances of the buyer or seller, and shall be determined without regard to any discounts for minority interest, illiquidity or other discounts. The cost of any independent appraisal in connection with the determination of Appraiser FMV in accordance with this Agreement shall be borne by GX.
“Articles” means the Amended and Restated Articles of the Company, dated as of the date hereof, as amended from time to time in accordance with their terms.
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York, New York or Toronto, Ontario are authorized or required by law to close.
“Cash Exchange Election” has the meaning specified in Section 2.2(b).
“Cash Exchange Five Day VWAP” means the arithmetic average of the VWAP for each of the five (5) consecutive Trading Days ending on the Trading Day prior to the applicable Exchange Date. By way of example, assuming for purposes of this example that none of the days in the relevant period that are Business Days are not Trading Days, then if the Exchange Notice date is a Friday, the Cash Exchange Five Day VWAP for such Exchange Date will be the arithmetic average of the VWAP for the five (5) consecutive Trading Day period beginning on and including the Friday of the previous week and ending on and including the Thursday of the week of such Exchange Date.
“Cash Exchange Notice” has the meaning specified in Section 2.2(b).
“Cash Exchange Payment” means, with respect to a particular Exchange for which GX has elected to make a Cash Exchange Payment in accordance with Section 2.2:
(a) if the Common Shares trade on a Recognized Securities Exchange or automated or electronic quotation system, an amount of cash equal to the product of (i) the number of Common Shares that would have been received by the Exchanging Shareholder in the Exchange for the portion of the shares of GX Class B Common Stock subject to the Cash Exchange Election if no Cash Exchange Election had been made and (ii) the Cash Exchange Five Day VWAP; or
(b) if the Common Shares are not then traded on a Recognized Securities Exchange or automated or electronic quotation system, as applicable, an amount of cash equal to the product of (i) the number of Common Shares that would have been received by the Exchanging Shareholder in the Exchange for the portion of the shares of GX Class B Common Stock subject to the Cash Exchange Election if no Cash Exchange Election had been made and (ii) the Appraiser FMV of one Common Share.
“Certificate of Incorporation” means the Second Amended and Restated Certificate of Incorporation of GX, dated as of the date hereof, as may be amended from time to time.
“Common Shares” means the Common Shares of the Company and any equity securities issued or issuable in exchange for, or with respect to, such Common Shares (a) by way of a dividend, split or combination of equity interest or (b) in connection with a reclassification, recapitalization, merger, arrangement, amalgamation, consolidation or other reorganization.
“Company” has the meaning specified in the introduction.
“Designated Recipient(s)” means the Exchanging Shareholder or any other person the Exchanging Shareholder designates as a recipient in the Exchange Notice, as applicable.
“Direct Exchange” has the meaning specified in Section 2.2(c).
“Direct Exchange Notice” has the meaning specified in Section 2.2(c).
“Exchange” means the exchange by GX of one or more shares of GX Class B Common Stock held by an Exchanging Shareholder for the Exchange Payment in accordance with this
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Agreement. Any references to an Exchange in this Agreement or any other agreement or document that references an “Exchange” as defined in this Agreement shall, unless specifically provided otherwise herein or therein, include a Direct Exchange where appropriate.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Exchange Amount” has the meaning specified in Section 2.2(a).
“Exchange Date” means a date specified in any Exchange Notice as the “Exchange Date,” which must not be less than three (3) nor greater than twenty (20) Business Days after the date upon which the Exchange Notice is received by the Company.
“Exchange Notice” has the meaning specified in Section 2.2(a).
“Exchange Payment” means, with respect to any Exchange, the Reciprocal Common Shares and/or the Cash Exchange Payment, as applicable.
“Exchange Ratio” has the meaning specified in Section 3.1.
“Exchange Right” has the meaning specified in Section 2.1.
“Exchanging Shareholder” has the meaning specified in the introduction.
“Fundamental Transaction” has the meaning specified in Section 4.5(b).
“Governmental Authority” has the meaning specified in Section 4.6.
“GX” has the meaning specified in the introduction.
“GX Class A Common Stock” means, as applicable, GX’s Class A Common Stock, par value $0.0001 per share or shares of Class A Common Stock (as defined in the Certificate of Incorporation).
“GX Class B Common Stock” means, as applicable, GX’s Class B Common Stock, par value $0.0001 per share or shares of Class B Common Stock (as defined in the Certificate of Incorporation).
“Joinder Agreement” means a joinder agreement, pursuant to which a Permitted Transferee will thereupon become a party to, and be bound by and obligated to comply with the terms and provisions of, this Agreement as an Exchanging Shareholder.
“Obligation” means the obligation to deliver the Reciprocal Common Shares upon exercise of the exchange rights pursuant to Article II hereof.
“Permitted Transferee” has the meaning specified in Section 7.6.
“Reciprocal Common Shares” means, with respect to the portion of an Exchange for which (a) a Cash Exchange Notice is not delivered by GX or (b) a Direct Exchange Notice electing
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to effect a Cash Exchange Payment is not delivered by the Company, a number of Common Shares equal to the product of (i) the Exchange Amount as set forth in the Exchange Notice, multiplied by (ii) the Exchange Ratio, as adjusted herein; provided that, so long as any Common Shares are listed on Nasdaq, any Reciprocal Common Shares issued to an Exchanging Shareholder with respect to an Exchange will be Common Shares listed on Nasdaq.
“Recognized Securities Exchange” means (a) a securities exchange that has registered with the SEC under Section 6 of the Securities Exchange Act of 1934, as amended, or (b) the Toronto Stock Exchange.
“Registration Statement” means a registration statement filed by the Company with the Securities and Exchange Commission in compliance with the Securities Act, all as the same shall be in effect at the time, and the rules and regulations promulgated thereunder, and/or a prospectus filed with the applicable Canadian securities regulatory authorities, for a public offering and sale of equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into, equity securities.
“Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Sponsor Support Agreement” means the Sponsor Support Agreement, dated as of September 25, 2022, by and among the Company, GX and the other persons set forth on the signature pages thereto.
“Trading Day” means a day on which the principal Recognized Securities Exchange on which the Common Shares are listed, quoted or admitted to trading is open for the transaction of business (unless such trading shall have been suspended for the entire day).
“Transactions” has the meaning specified in the Recitals.
“Transfer” of securities shall be construed broadly and shall include any direct or indirect issuance, sale, assignment, transfer, participation, gift, bequest, distribution, or other disposition thereof, or any pledge or hypothecation thereof, placement of a lien thereon or grant of a security interest therein or other encumbrance thereon, in each case whether voluntary or involuntary or by operation of law or otherwise. Notwithstanding anything to the contrary contained herein, Transfer shall not include the sale or transfer of Reciprocal Common Shares to an Exchanging Shareholder in connection with the exchange of its shares of GX Class B Common Stock.
“Transfer Agent” means Computershare Investor Services, Inc., or such other financial institution as may from time to time be designated by the Company to act as its transfer agent for Common Shares.
“VWAP” means the volume-weighted average price of a Common Share on the principal Recognized Securities Exchange on which Common Shares of the Company are listed (translated in U.S. dollars as required) during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “HP” function (set to weighted average) or, if the foregoing does not apply, the dollar volume-weighted average price of a Common Share in the over-the-counter market on the electronic bulletin board for Common
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Shares during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for Common Shares by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for Common Shares as reported by OTC Markets Group Inc. If the VWAP cannot be calculated for Common Shares on such Trading Day on any of the foregoing bases, the VWAP of Common Shares on such Trading Day shall be the fair market value per share on such Trading Day as reasonably determined by the Company.
Section 1.2 Terms Generally. In this Agreement, unless otherwise specified or where the context otherwise requires:
(a) the headings of particular provisions of this Agreement are inserted for convenience only and will not be construed as a part of this Agreement or serve as a limitation or expansion on the scope of any term or provision of this Agreement;
(b) words importing any gender shall include other genders;
(c) words importing the singular only shall include the plural and vice versa;
(d) the words “include,” “includes” or “including” shall be deemed to be followed by the words “without limitation”;
(e) the words “this Agreement,” “hereof,” “herein,” “hereby,” “hereunder” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement unless expressly so limited;
(f) references to “Articles,” “Exhibits,” “Sections” or “Schedules” shall be to Articles, Exhibits, Sections or Schedules of or to this Agreement unless otherwise indicated;
(g) references to any “person” include the successors and permitted assigns of such person;
(h) the use of the words “or,” “either” and “any” shall not be exclusive;
(i) references to “$” or “dollars” means the lawful currency of the United States of America;
(j) references to any agreement, contract or schedule, unless otherwise stated, are to such agreement, contract or schedule as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof; and
(k) the parties hereto have participated collectively in the negotiation and drafting of this Agreement; accordingly, in the event an ambiguity or question of intent or interpretation arises, it is the intention of the parties that this Agreement shall be construed as if drafted collectively by the parties hereto, and that no presumption or burden of proof shall arise
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favoring or disfavoring any party hereto by virtue of the authorship of any provisions of this Agreement.
ARTICLE
II
EXCHANGE RIGHT
Section 2.1 Exchange Right. On or prior to the End Date, each Exchanging Shareholder shall have the right (an “Exchange Right”) at any time and from time to time, upon the terms and subject to the conditions hereof, to surrender, without consideration, any or all of the shares of GX Class B Common Stock held by such Exchanging Shareholder to GX in exchange for Reciprocal Common Shares, as provided in and subject to the adjustments set forth in this Agreement; provided that the Exchange Right shall not be available with respect to any Earnout Share (as defined in the Sponsor Support Agreement) until such Earnout Share shall have become a Released Earnout Share (as defined in the Sponsor Support Agreement), except in the case of a deemed automatic exchange in connection with a Winding Up Event. To the extent any share of GX Class B Common Stock held by an Exchanging Shareholder has not been exchanged hereunder prior to the End Date, the Exchanging Shareholder shall elect to exchange such GX Class B Common Stock in exchange for Reciprocal Common Shares, as provided in and subject to the adjustments set forth in this Agreement. In addition, in the event of any occurrence described in Section 4.2(c) of the Certificate of Incorporation (a “Winding Up Event”), each Exchanging Shareholder with any share of GX Class B Common Stock which has not, at such time, been exchanged hereunder, will automatically be deemed to have elected to surrender each such share of GX Class B Common Stock in exchange for Reciprocal Shares hereunder effective immediately prior to such Winding Up Event, and each of the Parties hereto shall take any and all actions necessary to ensure that such exchange occurs immediately prior to such Winding Up Event.
Section 2.2 Exchange Right Procedures. Any Exchanging Shareholder that elects to exercise the exchange right set forth in Section 2.1 shall tender to GX the applicable number of shares of GX Class B Common Stock in exchange for Reciprocal Common Shares in accordance with the following procedures:
(a) The Exchanging Shareholder shall deliver to GX: (i) a notice, substantially in the form attached hereto as Exhibit A (an “Exchange Notice”), specifying, among other things, (A) the number of shares of GX Class B Common Stock that such Exchanging Shareholder wishes to exchange (the “Exchange Amount”), (B) the applicable Exchange Date and (C) the Designated Recipient(s); (ii) powers of transfer for the shares of GX Class B Common Stock and (iii) such other documentation as required by the Transfer Agent in connection with such exercise of the Exchange Right.
(b) Within one (1) Business Day following receipt of an Exchange Notice, GX may elect, only to the extent the Board of Directors of the Company has determined in good faith, after taking into account all debts, liabilities and obligations of the Company and any cash reserve that the Board of Directors determines is reasonable or necessary, that GX or the Company has available cash (or shall have available cash immediately prior to the applicable Exchange), to settle all or a portion of an Exchange in cash in an amount equal to the Cash Exchange Payment (the “Cash Exchange Election”), in lieu of the Reciprocal Common Shares, exercisable by GX (or its designee) by giving written notice of such election to the Exchanging Shareholder within one (1)
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Business Day following receipt of an Exchange Notice (such notice, the “Cash Exchange Notice”). The Cash Exchange Notice shall set forth the portion of the shares of GX Class B Common Stock that will be exchanged or surrendered and cancelled (as applicable) for cash in lieu of Reciprocal Common Shares. Any portion of the Exchange not settled for a Cash Exchange Payment shall be settled for Reciprocal Common Shares. GX’s election to settle all or a portion of an Exchange in cash need not be uniform and may be made selectively among Exchanging Shareholders, whether or not such Exchanging Shareholders are similarly situated.
(c) Notwithstanding anything to the contrary in this Section 2.2, subject to Section 2.2(b), the Company may, in its sole and absolute discretion, elect to effect an Exchange (subject to the terms of this Article II) through a direct exchange of the shares of GX Class B Common Stock by the Exchanging Shareholder to the Company for the Exchange Payment (a “Direct Exchange”). The Company may, at any time prior to an Exchange Date, deliver written notice (a “Direct Exchange Notice”) to GX and the Exchanging Shareholder setting forth its election to exercise its right to consummate a Direct Exchange if, and only if, such election does not prejudice the ability of the parties to consummate an Exchange or Direct Exchange on the Exchange Date, as determined by the Company in good faith. A Direct Exchange Notice may be revoked by the Company at any time if, and only if, any such revocation does not prejudice the ability of the parties to consummate an Exchange on the Exchange Date, as determined by the Company in good faith. The right to consummate a Direct Exchange in all events shall be exercisable for all the shares of GX Class B Common Stock that would otherwise have been subject to an Exchange. Except as otherwise provided in this Section 2.2(c), a Direct Exchange shall be consummated pursuant to the same timeframe and in the same manner (including the same form of Exchange Payment) as the relevant Exchange would have been consummated if the Company had not delivered a Direct Exchange Notice. For the avoidance of doubt, whether or not all or any portion of an Exchange Payment will be in the form of a Cash Exchange Payment shall be determined by GX, and the Company shall effect a Direct Exchange in the form(s) of Exchange Payment(s) as is consistent with this Agreement and GX’s election (if any).
Section 2.3 Exchange Payment.
(a) On the Exchange Date, in the case of an Exchange that is not a Direct Exchange:
(i) the Company shall contribute to GX for its delivery to the Exchanging Shareholder, (A) the Reciprocal Common Shares with respect to any shares of GX Class B Common Stock not subject to a Cash Exchange Notice and (B) the Cash Exchange Payment with respect to any shares of GX Class B Common Stock subject to a Cash Exchange Notice;
(ii) in consideration for the contribution set forth in Section 2.3(a)(i), GX shall issue to the Company a number of shares of GX Class A Common Stock equal to the number of shares of GX Class B Common Stock being exchanged by the Exchanging Shareholder; and
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(iii) the Exchanging Shareholder shall transfer and surrender the shares of GX Class B Common Stock being exchanged to GX in exchange for the Reciprocal Common Shares and the Cash Exchange Payment, as applicable.
(b) On the Exchange Date, in the case of an Exchange that is a Direct Exchange:
(i) the Exchanging Shareholder shall transfer the shares of GX Class B Common Stock being exchanged to the Company;
(ii) the Company shall transfer to the Exchanging Shareholder, in exchange for the shares of GX Class B Common Stock transferred pursuant to Section 2.3(b)(i), (A) the Reciprocal Common Shares with respect to any shares of GX Class B Common Stock not subject to a Cash Exchange Notice and (B) the Cash Exchange Payment with respect to any shares of GX Class B Common Stock subject to a Cash Exchange Notice;
(iii) the Company shall contribute to GX the shares of GX Class B Common Stock acquired pursuant to Section 2.3(b)(i); and
(iv) in consideration for the contribution set forth in Section 2.3(b)(iii), GX shall issue to the Company a number of shares of GX Class A Common Stock equal to the number of shares of GX Class B Common Stock contributed to GX.
ARTICLE
III
EXCHANGE RATIO
Section 3.1 Exchange Ratio; Adjustment of Exchange Ratio. Except as otherwise adjusted as provided for in Section 4.5, the ratio which each share of GX Class B Common Stock is exchangeable for a Common Share shall be one to one (the “Exchange Ratio”).
ARTICLE
IV
SUPPORT
Section 4.1 Taxes. Any and all share issuances or contributions hereunder shall be made free and clear of any and all present or future liens, encumbrances, transfer taxes and all liabilities with respect thereto. Each party shall pay any and all transfer taxes that he, she or it is required to pay under applicable law.
Section 4.2 No Effect on Agreement. Except as provided in this Agreement or otherwise agreed to by the parties in accordance with Section 7.8, the obligations of the Company under this Agreement shall not be altered, limited, impaired or otherwise affected by:
(a) any modification or amendment, in whole or in part, of the terms of the shares of GX Class B Common Stock or any other instrument or agreement evidencing or relating to any of the foregoing, except to the extent adopted in accordance with the Certificate of Incorporation;
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(b) any change, whether direct or indirect, in the Company’s relationship to GX, including any such change by reason of any merger or consideration or any sale, transfer, issuance, spin-off, distribution or other disposition of any stock, equity interest or other security of the Company or any other entity;
(c) the failure by an Exchanging Shareholder to bring an action against GX, the Company or any other party liable on the Obligation as a condition precedent to the exercise of its rights under this Agreement;
(d) any proceeding, voluntary or involuntary, involving bankruptcy, insolvency, receivership, reorganization, liquidation, wind-up or arrangement of the Company or GX or any defense which the Company or GX may have by reason of the order, decree or decision of any court or administrative body resulting from any such proceeding; and
(e) any other act or omission that may or might otherwise operate as a discharge of the Company as a matter of law or equity, other than the performance of the Obligation and this Agreement.
Section 4.3 Continuing Agreement. This Agreement shall be construed as a continuing, absolute and unconditional, subject to the compliance by the parties with the requirements and procedures set forth herein, agreement to issue Reciprocal Common Shares (or other property as provided herein) and a guarantee of performance of the Obligation and shall not be conditioned or contingent upon the pursuit by Exchanging Shareholders at any time of any right or remedy against the Company or GX. This Agreement shall remain in full force and effect until it is terminated in accordance with Section 7.4.
Section 4.4 Reservation of Shares. The Company shall, at all times while shares of GX Class B Common Stock are outstanding or are issuable (whether such obligation is absolute or contingent) pursuant to this Agreement and/or the Articles, reserve and keep available, from its authorized and unissued share capital, sufficient Common Shares solely for issuance and delivery as and when required under this Agreement and/or the Articles.
Section 4.5 Dilutive Actions; Issuances; Shareholder Rights; Fundamental Transactions.
(a) If there is (i) any division or subdivision (by split, distribution, reclassification, recapitalization, reorganization or otherwise) or combination or consolidation (by reverse split, reclassification, recapitalization, reorganization or otherwise) of any share of common stock of GX, the Company shall cause it to be accompanied by an identical proportionate division, subdivision, consolidation or combination of the Common Shares; or (ii) any division or subdivision (by split, distribution, reclassification, recapitalization, reorganization or otherwise) or combination or consolidation (by reverse split, reclassification, recapitalization, reorganization or otherwise) of the Common Shares, the Company and GX shall cause it to be accompanied by an identical proportionate division, subdivision, consolidation or combination of the shares of common stock of GX. In the event that the Company shall cause a dividend or other distribution to be made on the Common Shares (whether in the form of cash, securities, properties or other assets, and including an issuance of rights, options or warrants to all or substantially all holders of
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Common Shares), the Company shall take all necessary actions (including making contributions of cash, securities, property or other assets) so as to allow GX to declare and pay and effect, and GX shall declare and pay and effect (and the Company shall cause GX to declare and pay and effect) a dividend or distribution on each share of GX Class B Common Stock which shall be identical to the dividend or distribution paid on each Common Share, at the same time as such dividend or distribution shall be paid on the Common Shares subject, in each case, to Section 2.5(g) of the Sponsor Support Agreement and Section 4.2(b)(iii) of the Certificate of Incorporation.
(b) In the event of any takeover bid, share exchange offer, third party or issuer tender offer, merger, amalgamation, arrangement, acquisition, reclassification, reorganization, recapitalization, consolidation, dissolution, liquidation, wind-up or other similar transaction of the Company involving a payment or distribution of cash, securities or other assets to the holders of Common Shares or as a result of which the Common Shares are converted into, among other things, another security and the shares of GX Class B Common Stock shall remain outstanding (a “Fundamental Transaction”), then the exchange provisions of this Agreement shall thereafter permit the exchange of shares of GX Class B Common Stock for the amount of such cash, securities or other assets which an Exchanging Shareholder would have received had he, she or it made an exchange for Common Shares immediately prior to such Fundamental Transaction, regardless of whether such exchange would actually have been permitted at such time and taking into account any adjustment as a result of any division or subdivision (by any split, distribution or dividend, reclassification, reorganization, recapitalization or otherwise) or combination or consolidation (by reverse split, reclassification, recapitalization or otherwise) of such security, securities or other property that occurs after the effective time of such Fundamental Transaction; provided that if delivery of such cash, securities or other assets may not be effected in whole or in part for any reason or if the entitlement of the Exchanging Shareholders thereto shall otherwise be negatively impacted, the Exchange Ratio shall be equitably adjusted in accordance with commonly accepted financial practice and subject to any applicable stock exchange approval. For the avoidance of doubt, if there is any Fundamental Transaction in which the Common Shares are converted or changed into another security, securities or other property, this Agreement shall continue to be applicable, mutatis mutandis, with respect to such security, securities or other property. In the event of any Fundamental Transaction pursuant to which the holders of Common Shares are entitled to elect the form of consideration in exchange for their Common Shares, the Company shall not consummate such Fundamental Transaction unless and until it has provided each Exchanging Shareholder prompt written notice prior to the consummation of such Fundamental Transaction and reasonable opportunity to elect the form of consideration which an Exchanging Shareholder would have received had he, she or it made an exchange for Common Shares immediately prior to such Fundamental Transaction, regardless of whether such exchange would actually have been permitted at such time and taking into account any adjustment as a result of any division or subdivision (by any split, distribution or dividend, reclassification, reorganization, recapitalization or otherwise) or combination or consolidation (by reverse split, reclassification, recapitalization or otherwise) of such security, securities or other property that occurs after the effective time of such Fundamental Transaction.
(c) The Company shall (i) provide all Exchanging Shareholders with prompt written notice of any transaction referred to in clause (a) and (b) of this Section 4.5 involving the Common Shares promptly after the Company provides notice of any such proposed transaction, or otherwise proposes such transaction, to its shareholders but in no event later than the earliest of
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(1) ten (10) Business Days prior to the record date of such transaction, if applicable, and (2) twenty (20) Business Days prior to the applicable effective date or expiration date of such transaction, and (3) such time as notice thereof shall be required to be given pursuant to Rule 10b-17 under the Exchange Act, in each case so that such holders may participate by exercising their rights under Section 2.2(a) in any such transaction, and (ii) adopt reasonable modifications (following good faith consultation with the Exchanging Shareholders who individually hold at least 40% of the GX Class B Common Stock) to the exchange procedures set forth in this Agreement (including accelerating the date on which the Exchange Right may be exercised) to facilitate participation in any such transaction. Such notice shall specify all material terms of such transaction, the record date (if applicable), the proposed date of consummation of such transaction, and the effect of such transaction on the Exchange Ratio.
(d) All holders of shares of GX Class B Common Stock shall receive all notices, proxies, circulars, reports and other documents delivered to holders of Common Shares as if such holders of shares of GX Class B Common Stock were holders of Common Shares. All holders of shares of GX Class B Common Stock shall be entitled to attend all meetings, whether annual or extraordinary, of the shareholders of the Company as if such holders of GX Class B Common Stock were holders of Common Shares and receive such prior notice of such meetings at substantially the same time as holders of Common Shares.
(e) Each of the Company and GX covenants that such party shall not enter into any agreement, amend or modify any existing agreement, or take any other action, in each case that would adversely impact the rights of any Exchanging Shareholder in any material respect without first (i) providing prior written notice to each Exchanging Shareholder, (ii) engaging in good faith negotiations with the Exchanging Shareholders with respect to any such proposed agreement or any alternative agreement or arrangement by and among the Company, GX and the Exchanging Shareholders for the purpose of eliminating or mitigating any such adverse impact and (iii) receiving the prior written consent of the holders of a majority of the GX Class B Common Stock held by Exchanging Shareholders to enter into such agreement, amend or modify such existing agreement, or take such other action. Without limiting the generality of the foregoing, the foregoing shall apply to any agreement or action with respect to the following, in each case that would adversely impact the rights of any Exchanging Shareholder in any material respect:
(i) any amendment to the organizational documents of the Company or GX;
(ii) (x) the creation of a new class or series of share capital or capital stock or equity securities of the Company or GX (except as provided in the parentheticals in clauses (y)(1) and (y)(2) of this Section 4.5(e)(ii)) or (y) any issuance by the Company or GX in any transaction or series of related transactions of (1) equity or equity-linked securities (except for (A) common shares of GX issued as consideration for and equal to the fair market value of capital contributions made by the Company or a subsidiary thereof with proceeds of Company equity or equity-linked financing transactions and (B) common shares of the Company) or (2) any preferred equity or non-voting equity (except, with respect to GX, to the extent issued as consideration for and equal to the fair market value of capital contributions made by the Company or a subsidiary thereof with proceeds of Company preferred equity or non-voting equity financing transactions); or
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(iii) the declaration and payment of any stock dividend or other distribution by the Company (with respect to common shares of the Company) or GX (with respect to shares of GX Class A Common Stock) in which the holders of GX Class B Common Stock do not participate on a pro rata basis subject, in each case, to Section 2.5(g) of the Sponsor Support Agreement and Section 4.2(b)(iii) of the Certificate of Incorporation.
Section 4.6 Government Authority Approval. The Company and the Exchanging Shareholders shall cooperate with one another in (a) determining whether any action in respect of (including any filing with), or consent, approval, registration or qualification (other than registration under the Securities Act) or waiver by, any governmental authority under the laws of any applicable jurisdiction (a “Governmental Authority”) is required in connection with the issuance of Reciprocal Common Shares upon an exchange pursuant to Article II hereof, (b) using their respective commercially reasonable efforts to take any such actions (including making any filing or furnishing any information required in connection therewith) in order to obtain any such consent, approval, registration, qualification or waiver required in connection with an exchange to be effected in accordance with Article II hereof on a timely basis and (c) keeping the other party promptly informed in all material respects with respect to any communication given or received in connection with any such action, consent, approval or waiver, including using reasonable efforts to provide to each other in advance any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party; provided, that any and all fees, costs and expenses required to be incurred by either the Company or the Exchanging Shareholders in connection with obtaining any such consent, approval, registration or qualification or waiver by, any Governmental Authority shall be paid by the Company.
Section 4.7 Limited Proxy. To the extent any equitable adjustment contemplated by and in accordance with Section 4.5(a) or Section 4.5(b), including any related amendment to the Certificate of Incorporation, requires the approval of the Exchanging Shareholders, each Exchanging Shareholder hereby appoints 0896800 B.C. LTD., with full power of substitution and resubstitution, as its irrevocable proxy, to the fullest extent of such Exchanging Shareholder’s rights with respect to the shares of Class B Common Stock owned by such Exchanging Shareholder as of the relevant record date, to vote each of such share of Class B Common Stock solely in favor of any equitable adjustment, including any related amendment to the Certificate of Incorporation. Such appointment is coupled with an interest hereunder and is intended to be irrevocable for the purposes of this Agreement
ARTICLE
V
REPRESENTATIONS AND WARRANTIES
Section 5.1 Representations and Warranties of the Company. The Company represents and warrants as of the date hereof and as of the date of each exchange effected in accordance with Article II hereof that (i) it is validly existing and in good standing under the laws of British Columbia, (ii) it has all requisite power and authority to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby and to issue the Reciprocal Common Shares in accordance with the terms hereof, (iii) the execution and delivery of this Agreement by the Company and the consummation by it of the transactions contemplated hereby (including, without limitation, the issuance of the Reciprocal Common Shares) have been
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duly authorized by all necessary action on the part of the Company, (iv) this Agreement constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally, the execution, delivery and performance of obligations under this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby (including the issuance of the Reciprocal Common Shares) will not result in a violation or breach of the Articles, of any laws applicable to the Company, or of any material indenture, security, agreement or other instrument to which the Company or any of its subsidiaries is a party, (v) upon each issuance to a Designated Recipient as contemplated by this Agreement, the Reciprocal Common Shares so issued will be duly authorized and validly issued, fully paid and non-assessable and will be free of restrictions on transfer other than those existing by operation of applicable securities laws and will be free from all liens, claims and charges (including pre-emptive of other rights), and (vi) to the extent Common Shares are listed on one or more Recognized Securities Exchange, all Common Shares shall, at all times that shares of GX Class B Common Stock are exchangeable, be duly approved for listing subject to official notice of issuance (or the equivalent) on each Recognized Securities Exchange, if any, on which the Common Shares are then listed.
Section 5.2 Representations and Warranties of the Exchanging Shareholders. Each Exchanging Shareholder, severally and not jointly, represents and warrants that as of the date hereof and as of the date of each Exchange (i) if it is not a natural person, that it is duly incorporated or formed and, to the extent such concept exists in its jurisdiction of organization, is in good standing under the laws of such jurisdiction, (ii) it has all requisite legal capacity and authority to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby, (iii) if it is not a natural person, the execution and delivery of this Agreement by it of the transactions contemplated hereby have been duly authorized by all necessary corporate or other entity action on the part of such Exchanging Shareholder, (iv) this Agreement constitutes a legal, valid and binding obligation of such Exchanging Shareholder enforceable against it in accordance with its terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally, (v) the execution, delivery and performance of this Agreement by such Exchanging Shareholder and the consummation by such Exchanging Shareholder of the transactions contemplated hereby will not, if it is not a natural person, result in a violation of the certificate of incorporation and bylaws or other organizational constituent documents of such Exchanging Shareholder and (vi) that any Designated Recipient shall have all necessary legal authority under applicable laws to hold the Reciprocal Common Shares.
ARTICLE
VI
SECURITIES LAW MATTERS
Section 6.1 Securities Law Transfer Restrictions. Each Exchanging Shareholder agrees that it shall not offer, sell or otherwise Transfer any Common Shares issued pursuant to this Agreement other than (a) to the Company or GX, (b) in compliance with the Securities Act or applicable laws of any State or other jurisdiction governing the offer and sale of securities, (c) in a transaction that does not require registration under the Securities Act or the laws of any applicable State or other jurisdiction governing the offer and sale of securities, or (d) to (i) with respect to any
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person that is an individual, any member of such individual’s immediate family and/or any trust, partnership, limited liability company, or other similar estate planning vehicle that such individual controls and the beneficiaries of which are only such individual or such individual’s immediate family, and any other transferee who receives Common Shares by will or the laws of descent and distribution, and (ii) with respect to any other person, any partner, member or affiliate of such person; but only if the Exchanging Shareholder has furnished to the Company, with a copy to GX, a customary opinion of counsel, reasonably satisfactory to the Company and GX, prior to such sale or Transfer to the extent reasonably requested by GX. Each Exchanging Shareholder consents to the Company and GX making a notation on its records and giving instructions to any registrar and transfer agent not to record any Transfer of securities of the Company and GX held by such Exchanging Shareholder without first being notified by GX that it is reasonably satisfied that such Transfer is exempt from, or not subject to, the registration requirements of the Securities Act. GX shall promptly notify the Transfer Agent upon reasonably determining that a proposed Transfer is exempt from, or not subject to, the registration requirements of the Securities Act.
Section 6.2 Shareholder Register and Notation.
(a) Common Shares. Each of the Company, GX and the Exchanging Shareholders acknowledges and agrees that all Reciprocal Common Shares issued pursuant to this Agreement shall be issued and registered in the Company’s securities register. In connection with the issuance of Reciprocal Common Shares, the Company, GX and the Exchanging Shareholders acknowledge the following notation (or a similar notation) may be placed in the Company’s securities register:
“THE COMMON SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM PURSUANT TO APPLICABLE LAW. ANY OFFER, SALE, ASSIGNMENT, TRANSFER OR OTHER DISPOSITION OF THIS SECURITY IN A TRANSACTION THAT IS NOT REGISTERED UNDER THE SECURITIES ACT IS SUBJECT TO THE COMPANY’S RIGHT TO REQUIRE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY.”
If such notation has been placed in the Company’s securities register, the Company shall, at the request of an Exchanging Shareholder, remove or caused to be removed from such register the notation described in this Section 6.2(a), if it is reasonably satisfied (based upon opinion of counsel addressed to the Company reasonably satisfactory to the Company and GX, or in the case of an Exchanging Shareholder proposing to transfer such securities, pursuant to Rule 144(b)(1) of the Securities Act, a customary certificate addressed to the Company confirming compliance with such exemptions, reasonably satisfactory to the Company and GX) that such notation is no longer required under applicable requirements of the Securities Act.
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(b) Transfer Registration. The Company shall register all issuances and transfers of Reciprocal Common Shares made in accordance with the terms of this Agreement in its securities register.
Section 6.3 Supplemental Listing. If any of the Common Shares are listed on one or more Recognized Securities Exchanges, the Company shall take all such actions as may be necessary to ensure that the Reciprocal Common Shares issuable hereunder shall be duly approved for listing subject to official notice of issuance on each Recognized Securities Exchange, if any, on which the Common Shares are then listed. The Company shall take all such actions as may be necessary to ensure that all such Reciprocal Common Shares may be so issued without violation of any requirements of any domestic stock exchange upon which Common Shares may be listed (except for official notice of issuance which shall be immediately delivered by the Company upon each such issuance).
ARTICLE
VII
MISCELLANEOUS
Section 7.1 The Company’s Waivers. Subject to the compliance by the parties with the requirements and procedures set forth herein, (i) the Company waives any and all notice of the creation, renewal, extension or accrual of the Obligation and notice of or proof of reliance by the Exchanging Shareholders upon this Agreement or acceptance of this Agreement, and (ii) the Obligation shall conclusively be deemed to have been created, contracted, incurred, renewed, extended, amended or waived in reliance upon this Agreement, and all dealings between the Company and the Exchanging Shareholders shall likewise be conclusively presumed to have been had or consummated in reliance upon this Agreement. Subject to the compliance by the parties with the requirements and procedures set forth herein, the Company waives presentment, demand, notice, and protest of all instruments included in or evidencing the Obligation and all other demands and notices in connection with the delivery, acceptance, performance, default or enforcement of any such instrument or this Agreement.
Section 7.2 Election of Remedies. Each and every right, power and remedy herein given to the Exchanging Shareholders, or otherwise existing, shall be cumulative and not exclusive, and be in addition to all other rights, powers and remedies now or hereafter granted or otherwise existing. Each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised, from time to time and as often and in such order as may be deemed expedient by any of the Exchanging Shareholders.
Section 7.3 Effect of Delay or Omission to Pursue Remedy. No single or partial waiver by a party of any right, power or remedy, or delay or omission by any party in the exercise of any right, power or remedy which they may have shall impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. Any waiver given by any party of any right, power or remedy in any one instance shall only be effective in that specific instance, and only by the party expressly giving such waiver, and only for the purpose for which given, and will not be construed as a waiver of any right, power or remedy on any future occasion. No waiver of any term, covenant or provision of this Agreement, or consent given hereunder, shall be effective unless given in writing by the party to be bound thereby.
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Section 7.4 Termination. This Agreement and all of its provisions shall terminate and be of no further force or effect upon the earlier of (a) the date that no shares of GX Class B Common Stock remain outstanding (whether such obligation is absolute or contingent), (b) the mutual written consent of the Company, GX and each of the Exchanging Shareholders, and (c) the date that is ten (10) years following the date of this Agreement (the “Ten Year Anniversary”); provided, that, if, on the Ten Year Anniversary, any Earnout Share has been vested for a period of fewer than twenty-four (24) months (any such vested Earnout Share, a “Recent Vested Share”), this subsection (c) will be deemed to refer to the first date after the Ten Year Anniversary on which each such Recent Vested Share has been vested for a period of twenty-four (24) months (the earlier of (a), (b) and (c), the “End Date”); provided, however, that Article V, Article VI and this Article VII and the Exchanging Shareholder’s obligation under Section 2.1 to exchange any GX Class B Common Stock that has not yet been exchanged by the End Date shall survive any such termination. Upon such termination of this Agreement, all obligations of the parties under this Agreement will terminate, without any liability or other obligation on the part of any party hereto to any person in respect hereof or the transactions contemplated hereby, and no party hereto shall have any claim against another (and no person shall have any rights against such party), whether under contract, tort or otherwise, with respect to the subject matter hereof; provided, however, that the termination of this Agreement shall not relieve any party hereto from liability arising in respect of any breach of this Agreement prior to such termination.
Section 7.5 Governing Law; Venue; Waiver of Jury Trial.
(a) This Agreement will be construed and enforced in accordance with the laws of the State of Delaware, without regard to the conflict of laws principles that would result in the application of any law other than the law of the State of Delaware.
(b) Each of the parties hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction and venue of the Court of Chancery of the State of Delaware (or, to the extent that such Court does not have subject matter jurisdiction, the Superior Court of the State of Delaware) or, if it has or can acquire jurisdiction, in the United States District Court for the District of Delaware (collectively, the “Chosen Courts”), in any proceeding arising out of or relating to this Agreement or the agreements delivered in connection herewith or the Transactions or for recognition or enforcement of any judgment relating thereto, and each of the parties hereby irrevocably and unconditionally (i) agrees not to commence any such proceeding, except in the Chosen Courts; (ii) agrees that any claim in respect of any such proceeding may be heard and determined in the Chosen Courts; (iii) waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any such proceeding in the Chosen Courts; and (iv) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such proceeding in the Chosen Courts. Each of the parties agrees that a final judgment in any such proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable law. Each party irrevocably consents to service of process inside or outside the territorial jurisdiction of the Chosen Courts the manner provided for notices in Section 7.10. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by applicable law.
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(c) EACH PARTY HEREBY IRREVOCABLY WAIVES, AND WILL CAUSE ITS SUBSIDIARIES AND AFFILIATES TO WAIVE, ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS.
Section 7.6 Assignment. This Agreement will be binding upon and inure to the benefit of the parties and their respective successors, legal representatives and permitted assigns. No party may assign any of its rights or delegate any of its obligations under this Agreement, by operation of law or otherwise, without the prior written consent of the other parties; provided that any Exchanging Shareholder shall be entitled to assign any or all of his, her or its rights hereunder in conjunction with the assignment or transfer of his, her or its shares of GX Class B Common Stock (or the right to receive Common Shares with respect thereto) subject to the restrictions set forth in, and in accordance with, the Sponsor Support Agreement (a “Permitted Transferee”). All Permitted Transferees shall be required as a condition to any such assignment or transfer, to become a party to this Agreement as an Exchanging Shareholder by executing a Joinder Agreement and the Company and GX shall counter sign and deliver to such Permitted Transferee an executed Joinder Agreement promptly following receipt of a validly executed Joinder Agreement from such Permitted Transferee. Notwithstanding anything to the contrary contained in this Section 7.6, if a holder of shares of GX Class B Common Stock shall have entered into a lock-up or similar agreement or an arrangement with GX or the Company with respect to any such holder’s shares of capital stock of GX or the Company (including the Sponsor Support Agreement and the Registration Rights and Lock-Up Agreement), then such agreement or arrangement shall also apply to the holder with respect to it shares of GX Class B Common Stock mutatis mutandis. Any transfer of any rights under this Agreement in violation of any provision of this Agreement shall be void ab initio and of no force or effect.
Section 7.7 Specific Performance. The parties agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy, would occur in the event that the parties do not perform their obligations under the provisions of this Agreement (including failing to take such actions as are required of them hereunder to consummate this Agreement) in accordance with its specified terms or otherwise breach such provisions. Subject to the other provisions of this Section 7.7, the parties acknowledge and agree (and further agree not to take any contrary position in any litigation concerning this Agreement) that (a) the parties will be entitled to an injunction or injunctions, specific performance, or other equitable relief, to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof without proof of damages or otherwise, and that such relief may be sought in addition to and will not limit, diminish or otherwise impair, any other remedy to which they are entitled under this Agreement, (b) the provisions set forth herein are not intended to and do not adequately compensate for the harm that would result from a breach of this Agreement and will not be construed to limit, diminish or otherwise impair in any respect any party’s right to specific enforcement, and (c) the right of specific enforcement is an integral part of the Transactions and without that right, none of the parties would have entered into this Agreement. The parties acknowledge and agree that any party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in accordance with this Section 7.7 will not be required to provide any bond or other security in connection with any such order or injunction.
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Section 7.8 Amendment. This Agreement may not be amended, changed, supplemented, waived or otherwise modified or terminated, except upon the execution and delivery of a written agreement executed by GX, the Company and the holders of a majority of the GX Class B Common Stock.
Section 7.9 Severability. The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any person or any circumstance, is invalid or unenforceable, then (a) a suitable and equitable provision will be substituted therefor in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other persons or circumstances will not be affected by such invalidity or unenforceability, nor will such invalidity or unenforceability affect the validity or enforceability of such provision, or the application thereof, in any other jurisdiction.
Section 7.10 Notices. All notices and other communications among the parties will be in writing and will be deemed to have been duly given (a) when delivered in person, (b) when delivered by FedEx or other nationally recognized overnight delivery service, or (c) when delivered by email (so long as the sender of any such e-mail has not received an e-mail from the applicable server indicating a delivery failure), in each case, according to the instructions set forth below. Such notices will be deemed given: at the time of personal delivery, if delivered in person; one (1) Business Day after being sent, if sent by reputable, overnight delivery service and at the time sent (so long as the sender of any such e-mail has not received an e-mail from the applicable server indicating a delivery failure), if sent by email prior to 5:00 p.m. local time of the recipient on a Business Day; or on the next Business Day if sent by email after 5:00 p.m. local time of the recipient on a Business Day or on a non-Business Day.
(a) If to an Exchanging Shareholder:
c/o GX Sponsor LLC
1325 Avenue of the Americas, 28th Floor
New York, NY 10019
Attention: Jay Bloom
Dean Kehler
Email: jay.bloom@trimarancapital.com
dean.kehler@trimarancapital.com
with a copy to (which will not constitute
notice):
Skadden, Arps, Slate, Meagher & Flom LLP
One Manhattan West
New York, New York 10001
Attention: Michael Chitwood
Michael Civale
Email: Michael.Chitwood@skadden.com
Michael.Civale@skadden.com
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(b) If to GX or the Company:
NioCorp Developments Ltd.
7000 South Yosemite Street, Suite 115
Centennial, CO 80112
Attention: Mark Smith
Neal Shah
Email: msmith@niocorp.com
nshah@niocorp.com
with a copy to (which will not constitute
notice):
Jones Day
250 Vesey Street
New York, NY 10281
Attention: Joel May
Ann Bomberger
Email: jtmay@jonesday.com
ambomberger@jonesday.com
Section 7.11 Counterparts. This Agreement may be executed in any number of counterparts (including by pdf or other readable electronic format), each such counterpart being deemed to be an original instrument, with the same effect as if the signature thereto and hereto were upon the same instrument, and will become effective when one or more counterparts have been signed by each of the Parties and delivered (including by email or DocuSign) to the other parties, and all such counterparts will together constitute one and the same agreement.
Section 7.12 Entire Agreement. This Agreement and the agreements referenced herein constitute the entire agreement, and supersede all other prior agreements, understandings, representations and warranties both written and oral, among the parties, with respect to the subject matter hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first written above.
NIOCORP DEVELOPMENTS LTD.
| By: | /s/ Mark Smith Name: Mark Smith Title: Chief Executive Officer |
[Signature Page to Exchange Agreement]
ELK CREEK RESOURCES CORP.
| By: | /s/ Neal Shah Name: Neal Shah Title: Treasurer and Secretary |
[Signature Page to Exchange Agreement]
GX ACQUISITION CORP. II
| By: | /s/ Jay R. Bloom Name: Jay R. Bloom Title: Co-Chairman and Co-Chief Executive Officer |
[Signature Page to Exchange Agreement]
GX SPONSOR II LLC
By: Cooper Road, LLC, as Managing Member
| By: | /s/ Jay R. Bloom Name: Jay R. Bloom Title: Co-Chairman and Co-Chief Executive Officer |
| By: | /s/ Dean C. Kehler Name: Dean C. Kehler Title: Managing Member |
[Signature Page to Exchange Agreement]
EXHIBIT A
Form of Exchange Notice
To: Elk Creek Resources Corp. (f/k/a GX Acquisition Corp. II)
7000 South Yosemite Street, Suite 115
Centennial, CO 80112
Attention: Mark Smith; Neal Shah
Date: [ ]
Ladies and Gentlemen:
Pursuant to the Exchange Agreement, dated March 17, 2023, the undersigned hereby requests Elk Creek Resources Corp. (f/k/a GX Acquisition Corp. II) to (i) exchange the number of shares of GX Class B Common Stock set forth below for the applicable number of Reciprocal Common Shares and (ii) deliver such Reciprocal Common Shares to the Designated Recipient set forth below.
DESCRIPTION OF SHARES TENDERED
|
GX Class B Common
Stock |
Number of Shares Exchanged |
| (1) | Unless otherwise indicated, it will be assumed that all shares described above are being exchanged. |
DELIVERY OF RECIPROCAL COMMON SHARES
|
Name, Address
and Taxpayer ID |
Number of Shares
of Reciprocal |
Proposed Exchange Date (minimum three (3) and maximum twenty (20) Business Days in advance):
Delivery by book-entry transfer must be made to an account maintained by the depositary with the book-entry transfer facility. Please complete the following (only participants in the book-entry transfer facility may receive Reciprocal Common Shares by book-entry transfer):
A-1
| Name of Designated Recipient (Must Exactly Match Name Supplied Above) |
Name of Institution Receiving Reciprocal Common Shares |
Account Number |
Transaction Code Number | |||
|
Name and signature of Exchanging Shareholder: |
|
| (print name) | |
| (signature) |
A-2
Exhibit 10.4
Indemnity AGREEMENT
THIS AGREEMENT made effective as of the _______ day of ________, 2023.
BETWEEN:
NioCorp Developments Ltd., a corporation incorporated under the laws of the Province of British Columbia and having an office at 7000 South Yosemite Street, Suite 115 Centennial, CO 80112
(the “Corporation”)
AND:
(the “Indemnitee”)
WHEREAS:
A. The Indemnitee has, at the request of the Corporation, agreed to act as a director and/or officer of the Corporation or as a director and/or officer of, or in a similar capacity with, an affiliate (an “Affiliate”) of the Corporation (within the meaning of the Business Corporations Act (British Columbia) (the “Act”)); and
B. The Indemnitee is willing to act or continue to act as set out in recital A hereof on the condition that the Corporation enter into this Agreement.
NOW THEREFORE in consideration of the Indemnitee consenting to act as a director and/or officer of the Corporation or as a director and/or officer of, or in a similar capacity with, an Affiliate, and other good and valuable consideration, the receipt and sufficiency of which each party acknowledges, the parties agree as follows:
1. General Indemnity. Subject to paragraphs 2 and 3 hereof, the Corporation will, to the fullest extent possible under applicable law, indemnify and hold harmless the Indemnitee and the heirs, executors, administrators and other legal representatives of the Indemnitee (each of which is included in any reference in this Agreement to the Indemnitee) against any and all costs, losses, charges, damages (including, without limitation, incidental, special, consequential, exemplary or punitive damages), liabilities and expenses, regardless of when or how they arose including, without limiting the generality of the foregoing, all liabilities, fines, penalties, fees, including charges and disbursements for the services of any experts, all legal fees, charges and disbursements on a solicitor and client basis and any amount paid to settle any actions or proceedings or to satisfy any judgments (any and all of the foregoing being hereinafter referred to as “Liabilities”) reasonably incurred by the Indemnitee for, or in connection with, any civil, criminal, administrative, investigative or other proceeding, whether threatened, pending,
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continuing or completed (any and all of the foregoing being hereinafter referred to as an “Action”), to which the Indemnitee may be involved (whether as a party, witness or otherwise) because of being or having been a director or officer of or acting in a similar capacity with the Corporation or any Affiliate, including but not limited to any act, matter, deed or thing whatsoever made, done, committed, permitted or acquiesced in by the Indemnitee as a director or officer of or acting in a similar capacity with the Corporation or any Affiliate, whether before or after the effective date of this Agreement and whether or not related to an Action.
2. Limitations on Indemnity. The obligation of the Corporation to indemnify the Indemnitee in accordance with paragraph 1 hereof will only apply if:
| (a) | the Indemnitee acted honestly and in good faith with a view to the best interests of the Corporation or Affiliate, as the case may be; and |
| (b) | in the case of a non-civil proceeding, the Indemnitee had reasonable grounds for believing that the Indemnitee’s conduct was lawful. |
Termination of any proceeding by judgment, order, settlement or conviction, or upon a plea of “nolo contendere” or its equivalent, or similar or other result, will not, of itself, create any presumption for the purposes of this Agreement that the Indemnitee did not act honestly and in good faith with a view to the best interests of the Corporation or an Affiliate, as the case may be, or, in the case of a proceeding other than a civil proceeding, that the Indemnitee did not have reasonable grounds for believing that the Indemnitee’s conduct was lawful (unless the judgment or order of a court or another tribunal of competent jurisdiction specifically finds otherwise). Neither the failure of the Corporation (including its Board of Directors, independent legal counsel or its shareholders) to have made a determination that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel or its shareholders) that the Indemnitee has not met such applicable standard of conduct, will be a defence to any action brought by the Indemnitee against the Corporation to recover the amount of any indemnification claim, nor create a presumption that the Indemnitee has not met the applicable standard of conduct.
3. Payment of Expenses.
| (a) | Any amounts to be paid by the Corporation pursuant to paragraph 1 hereof shall be advanced by the Corporation promptly as and when such Liabilities arise. |
| (b) | Notwithstanding clause (a) of this paragraph 3, all expenses reasonably incurred or to be reasonably incurred by the Indemnitee in connection with an Action described in paragraph 1 hereof will be advanced or paid by the Corporation upon the request of the Indemnitee and in advance of the determination of any Action to enable the Indemnitee to properly investigate, defend or appeal the Action; provided that the Indemnitee shall provide a written undertaking in accordance with Section 162(2) of the Act and to the extent it is determined in a final |
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judgment of a court of competent jurisdiction that the Corporation is not liable to indemnify the Indemnitee by virtue of paragraph 2 of this Agreement, the Indemnitee will repay forthwith upon demand all amounts paid by the Corporation on behalf of the Indemnitee under this paragraph 3.
4. Notice of Proceedings.
| (a) | The Indemnitee will give written notice to the Corporation upon the Indemnitee being served with any statement of claim, writ, notice of motion, indictment, subpoena, investigation order or other document commencing, threatening or continuing any Action involving the Corporation, an Affiliate or the Indemnitee which may result in a claim for indemnification under this Agreement. |
| (b) | The Corporation will give written notice to the Indemnitee upon the Corporation or an Affiliate being served with any statement of claim, writ, notice of motion, indictment, subpoena, investigation order or other document commencing, threatening or continuing any Action involving the Indemnitee. |
| (c) | Failure by either party to notify the other of any Action or threatened Action will not relieve the Corporation from liability under this Agreement except to the extent that such failure materially prejudices the Corporation or a Subsidiary. |
5. Subrogation. Promptly after receiving notice of any Action or threatened Action from the Indemnitee, the Corporation may, and upon the written request of the Indemnitee will, assume the defence of the Action and on behalf of the Indemnitee will retain counsel who is reasonably satisfactory to the Indemnitee to represent the Indemnitee in respect of the Action. If the Corporation assumes conduct of the defence on behalf of the Indemnitee, the Indemnitee consents to the conduct thereof and to any action taken by the Corporation, in good faith, in connection therewith and the Indemnitee will fully cooperate in the defence including, without limitation, the provision of documents in the possession or reasonably available to the Indemnitee, attending examinations for discovery, making affidavits, meeting with counsel and testifying and divulging to the Corporation all information known by the Indemnitee and reasonably required to defend or prosecute the Action.
6. Separate Counsel. In connection with an Action the Indemnitee will have the right to employ separate counsel of the Indemnitee’s choosing and to participate in the defence thereof but the fees and disbursements of the separate counsel will be at the Indemnitee’s expense unless:
| (a) | counsel chosen by the Corporation to represent the Indemnitee reasonably determines that there are legal defences available to the Indemnitee that are different from or in addition to those available to the Corporation or that a conflict of interest exists which makes representation by counsel chosen by the Corporation not advisable; |
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| (b) | the Corporation has not assumed the defence of the Action and employed counsel reasonably satisfactory to the Indemnitee within a reasonable period of time after receiving notice of the Action; or |
| (c) | employment of the separate counsel has been authorized by the Corporation, |
in which event the reasonable fees and disbursements of the separate counsel on a solicitor and client basis will be paid by the Corporation.
7. Settlement of Claim. No admission of liability and no settlement of any Action or threatened Action in a manner adverse to the Indemnitee will be made without the written consent of the Indemnitee, such consent not to be unreasonably withheld. No admission of liability will be made by the Indemnitee without the consent of the Corporation and the Corporation will not be liable for any settlement of any Action or threatened Action made without its consent, such consent not to be unreasonably withheld.
8. Determination of Right to Indemnification. If any payment under this Agreement requires the approval of a court under the provisions of any legislation binding upon the Corporation, the Corporation agrees to apply to the court for and use reasonable commercial efforts to obtain such approval or, if the Corporation does not do so, the Indemnitee may apply to the court for such approval. The Corporation shall bear all reasonable fees and expenses incurred by the Corporation or the Indemnitee in applying for (whether or not approval is ultimately obtained) and obtaining such approval.
9. Director and Officer Liability Insurance. The Corporation will obtain and maintain directors’ and officers’ liability insurance coverage in respect of the Indemnitee with a reputable third party insurer on such terms, with such policy conditions and in such amounts and with coverage and policy limits as are available to the Corporation on reasonable commercial terms for so long as the Indemnitee is a director or officer or acts in a similar capacity with the Corporation or an Affiliate, and for so long thereafter (having regard to all applicable statutory limitation periods) as is necessary to ensure that any Action or threatened Action which may be commenced or taken against the Indemnitee after the Indemnitee ceases to be a director or officer or ceases to act in a similar capacity with the Corporation or an Affiliate, is covered by such insurance to the same extent as would have been the case had such Action or threatened Action commenced during the period during which the Indemnitee was such a director or officer or acted in such a similar capacity. The Corporation will, within a reasonable time, provide to the Indemnitee a copy of each policy of insurance providing the coverages contemplated by this paragraph after coverage is obtained, and evidence of each annual renewal thereof, and will notify the Indemnitee if the insurer cancels, makes material changes to coverage or refuses to renew coverage (or any part of the coverage).
10. Tax Matters. If the Indemnitee is required to include in income or in the income of the Indemnitee’s estate, any payment made under this Agreement for the purpose of determining income tax payable by the Indemnitee, the Corporation will pay such amount as will fully indemnify the Indemnitee for the amount of all Liabilities and all income tax payable as a result
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of the receipt of the indemnity payment such that the net after tax amount of every payment made to the Indemnitee hereunder, after the provision for the payment of any taxes payable by the Corporation or the Indemnitee, is equal to the amount that the Indemnitee would have received had there been no such taxes payable.
11. Representations and Warranties. The Corporation represents and warrants that it has the corporate power, authority and capacity to execute and deliver this Agreement and to perform its other obligations hereunder, that this Agreement constitutes a legally enforceable and binding obligation of the Corporation and that none of the provisions of this Agreement conflict with any provision of the constating documents of the Corporation.
12. Scope of Indemnity. The intention of this Agreement is to provide the Indemnitee with indemnification to the fullest extent permitted by law and, without limiting the generality of the foregoing and notwithstanding anything contained herein:
| (a) | nothing in this Agreement will be interpreted, by implication or otherwise, to limit the scope of the indemnification provided in paragraph 1 hereof except as specifically provided herein; and |
| (b) | paragraph 1 hereof is intended to provide indemnification to the Indemnitee to the fullest extent permitted by the Act and, in the event that such statute is amended or replaced and a broader scope of indemnification (including, without limitation, the deletion or limiting of one or more of the conditions to the applicability of indemnification) is permitted or allowed, paragraph 1 hereof will be deemed to be amended concurrently with the amendment to, or replacement of, the statute so as to provide such broader indemnification. |
13. No Duplication of Payments. The Corporation shall not be liable under this Agreement to make any payment in connection with any Action to the extent the Indemnitee has otherwise actually received payment (under any insurance policy or otherwise) of the amount otherwise payable hereunder.
14. Set-off. The Corporation grants to the Indemnitee the right to set-off any amount owing by the Corporation hereunder to the Indemnitee against any amount that the Indemnitee may owe to the Corporation at that time.
15. Unconditional.
| (a) | This Agreement is absolute and unconditional and the obligations of the Corporation will not be affected, discharged, impaired, mitigated or released by (a) any extension of time, indulgence or modification that the Indemnitee may extend or make with any person threatening or commencing an Action, or (b) the discharge or release of the Indemnitee in any bankruptcy, insolvency, receivership or other proceedings of creditors. |
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| (b) | No action or proceeding brought or instituted under this Agreement and no recovery pursuant thereto will be a bar or defence to any further action or proceeding which may be brought under this Agreement. |
| (c) | The rights of the Indemnitee hereunder will be in addition to any other rights the Indemnitee may have under the constating documents of the Corporation or the Act or otherwise. To the extent that a change in the Act (whether by statute or judicial decision) permits greater indemnification by agreement than would be afforded currently under the constating documents of the Corporation or this Agreement, it is the intent of the Corporation and the Indemnitee that the Indemnitee be entitled to the greater benefits afforded by that change. The rights of the Indemnitee under this Agreement will not be diminished by any amendment to the constating documents of the Corporation or of any other agreement or instrument to which the Indemnitee is not a party, and will not diminish any other rights that the Indemnitee now has, or in the future may have, against the Corporation. |
16. Notices. In this Agreement:
| (a) | any notice or communication required or permitted to be given under this Agreement will be in writing and will be considered to have been given if delivered by hand or transmitted by facsimile or other transmission to the address of each party set out below: |
| (i) | if to the Corporation: |
NioCorp Developments Ltd.
7000 South Yosemite Street
Suite 115
Centennial, CO 80112
Attention: Neal Shah, Chief Financial Officer
Email: . nshah@niocorp.com
| (ii) | if to the Indemnitee: |
to the address set out on the first page hereof,
or to such other address or facsimile transmission number as a party may designate in the manner set out above; and
| (b) | any notice or communication will be considered to have been received: |
| (i) | if delivered by hand during business hours on a business day, upon receipt by a responsible representative of the receiver, and if not delivered during business hours or on a business day, upon the commencement of business at the location of the receiver on the next business day; and |
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| (ii) | if sent by facsimile transmission during business hours on a business day, upon the sender receiving confirmation of the transmission, and if not transmitted during business hours or on a business day, upon the commencement of business at the location of the receiver on the next business day. |
17. Commencement of Term and Survival. Notwithstanding the actual date of execution and delivery of this Agreement, this Agreement and the indemnity provided herein (the “Indemnity”) will be conclusively deemed to commence on the day upon which the Indemnitee first became a director or officer of the Corporation or a director or officer of, or acted in a similar capacity with, any Affiliate. This Agreement and the Indemnity shall survive the Indemnitee ceasing to be a director or officer of the Corporation or a director or officer of, or ceasing to act in a similar capacity with, an Affiliate and shall continue in full force and effect thereafter.
18. Re-Election. The obligations of the Corporation under this Agreement continue after and are not affected in any way by the re-election or re-appointment from time to time of the Indemnitee as a director and/or officer of or acting in a similar capacity with the Corporation or any Affiliate.
19. Indemnitee’s Compensation. The obligations of the Corporation under this Agreement are not diminished or in any way affected by:
| (a) | the Indemnitee holding from time to time any direct or indirect financial interest in the Corporation or any Affiliate; |
| (b) | payment to the Indemnitee by the Corporation of director’s fees or any salary, wages, or any other form of compensation or remuneration; and |
| (c) | except as otherwise herein provided, any directors’ and/or officers’ liability insurance placed by or for the benefit of the Indemnitee by the Indemnitee, the Corporation or any Affiliate. |
20. Resignation or Removal. Nothing in this Indemnity will prevent an Indemnitee from resigning as a director or officer of or ceasing to act in a similar capacity with the Corporation or any Affiliate. The obligations of the Corporation hereunder shall continue after and are not affected in any way by the Indemnitee ceasing to be a director and/or officer of or ceasing to act in a similar capacity with the Corporation or an Affiliate, whether by resignation, removal, death, incapacity, disqualification under applicable law, or otherwise.
21. Insolvency. The liability of the Corporation under this Agreement will not be affected, discharged, impaired, mitigated or released by the discharge or release of the Indemnitee in any bankruptcy, insolvency, receivership or other similar proceeding of creditors.
22. Time for Payment. The Corporation will pay all amounts due to the Indemnitee under this Agreement forthwith upon demand by the Indemnitee.
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23. Severability. If any term of this Agreement is determined to be invalid or unenforceable, in whole or in part, the invalidity or unenforceability will attach only to that term or part term, and the remaining part of that term and all other terms of this Agreement will continue in full force and effect. The parties will negotiate in good faith to agree to a substitute term that will be as close as possible to the intention of any invalid or unenforceable term while being valid and enforceable. The invalidity or unenforceability of any term in any particular jurisdiction will not affect its validity or enforceability in any other jurisdiction where it is valid or enforceable.
24. Further Acts. Each party agrees to do all such things and take all such actions as may be necessary or desirable to give full force and effect to the matters contemplated by this Agreement. No amendment to this Agreement will be valid or binding unless set forth in writing and executed by both the Corporation and the Indemnitee.
25. Enurement. This Agreement enures to the benefit of the Indemnitee and is binding upon the parties and their respective heirs, executors, administrators, legal representatives, successors and permitted assigns. This Agreement may not be assigned by the Corporation without the prior written consent of the Indemnitee. For greater certainty, this Indemnity will be binding upon any successor to the Corporation resulting from any amalgamation, plan of arrangement or purchase or assigning of all or substantially all of the assets of the Corporation.
26. Independent Legal Advice. The Indemnitee acknowledges having been advised to obtain independent legal advice with respect to entering into this Agreement, that the Indemnitee has obtained independent legal advice or has expressly decided not to seek that advice, and that the Indemnitee is entering into this Agreement with full knowledge of the contents of it, of the Indemnitee’s own free will and with full capacity to do so.
27. Time. Time will be of the essence of this Agreement.
28. Governing Law and Jurisdiction. This Agreement will be governed by and construed in accordance with the laws of the Province of British Columbia law and the federal laws of Canada applicable therein and will be treated in all respects as a British Columbia contract.
29. Previous Indemnities. This Agreement is in addition to and not in substitution for any previous indemnity or indemnities which may have been given by the Corporation to the Indemnitee and such previous indemnity or indemnities are unaffected hereby and will continue in full force and effect in accordance with their respective terms.
30. Counterparts. This Agreement may be executed in any number of counterparts (including counterparts by facsimile or other electronic transmission), each of which when so executed will be deemed to be an original and will have the same force and effect as an original but such counterparts together will constitute but one and the same instrument.
IN WITNESS WHEREOF this Agreement has been executed by the Corporation and the Indemnitee on the date first written above.
-Signature page immediately follows-
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NIOCORP DEVELOPMENTS LTD.
Per:
Authorized Signatory
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[INDEMNITEE]
Exhibit 99.1
NioCorp
Closes Business Combination with GXII and Separate
Financing Deals Providing Access to Up to US$71.9 Million in
Net Proceeds Over the Next Three Years
CENTENNIAL, Colo. (March 17, 2023) – NioCorp Developments Ltd. ("NioCorp" or the "Company") (TSX: NB; OTCQX: NIOBF) today announced the completion of its previously announced business combination (the “Business Combination”) with GX Acquisition Corp. II (“GXII”). Further, NioCorp also announced the closing of both tranches of its previously announced convertible debt financing (the “Yorkville Convertible Debt Financing”) with YA II PN, Ltd., an investment fund managed by Yorkville Advisors Global, LP (together with YA II PN, Ltd., “Yorkville”), and the effectiveness of its previously announced standby equity purchase facility with Yorkville (the “Yorkville Equity Facility Financing”, and together with the Business Combination and the Yorkville Convertible Debt Financing, the “Transactions”).
Pursuant to the Business Combination, a wholly owned, U.S.-based subsidiary of NioCorp merged with and into GXII, with GXII surviving the merger as a subsidiary of NioCorp. In connection with the merger, GXII changed its name to “Elk Creek Resources Corp.” As the parent company of the merged entity, NioCorp issued 1,753,823 common shares (the “Common Shares”) in exchange for all of the Class A shares of GXII issued and outstanding immediately prior to the Business Combination. The Class B shares of GXII issued and outstanding immediately prior to the Business Combination (after giving effect to the surrender of certain Class B shares of GXII in accordance with the support agreement, dated September 25, 2022, among GX Sponsor II LLC, GXII, NioCorp and the other persons party thereto) were converted into Class B shares of GXII (now known as Elk Creek Resources Corp.) as the surviving entity of the merger and became exchangeable into Common Shares on a one-for-one basis, a portion of which are subject to vesting during the first ten years following the Business Combination closing date based upon achieving market share price milestones, and all of which are subject to restrictions on transfer beginning upon the closing and ending upon the earlier of (i) one year after the closing and (ii) the date on which the trading price of the Common Shares exceeds certain thresholds or the date on which NioCorp completes a transaction that results in all of NioCorp’s shareholders having the right to exchange their Common Shares for cash, securities or other property. In connection with the closing, NioCorp also assumed the outstanding GXII share purchase warrants (the “Assumed Warrants”), which will be exercisable for Common Shares with an exercise price of approximately $10.28 per Common Share. The Assumed Warrants are exercisable beginning on the 30th day after closing and will remain exercisable until the 5th
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anniversary of the closing date. All numbers in this press release give effect to the completed Consolidation (as defined herein).
Pursuant to the Yorkville Convertible Debt Financing, Yorkville advanced a total of US$15.36 million to NioCorp in consideration of the issuance of US$16.0 million aggregate principal amount of convertible debentures of NioCorp convertible into Common Shares of NioCorp (the “Convertible Debentures”). Each Convertible Debenture issued under the Yorkville Convertible Debt Financing is an unsecured obligation of NioCorp, may be converted at a discount to the market price as of the date of conversion, has an 18-month term, which may be extended for one six-month period in certain circumstances at the option of NioCorp, and incurs a simple interest rate obligation of 5.0% per annum (which will increase to 15.0% per annum upon the occurrence of an event of default). In conjunction with the issuance of the Convertible Debentures, NioCorp issued to Yorkville 1,789,267 Common Share purchase warrants entitling Yorkville to purchase Common Shares (the “Financing Warrants”) at an exercise price of approximately $8.94 per Common Share. The Financing Warrants are exercisable beginning on the earlier of (a) six months from their issuance or (b) the effective date of the initial registration statement registering the resale by Yorkville of the Common Shares issuable upon the conversion of the Convertible Debentures and the exercise of the Financing Warrants under the U.S. Securities Act of 1933 (the “Exercise Date”), and may be exercised at any time prior to their expiration. On each of the first 12 monthly anniversaries of the Exercise Date, 1/12th of the Financing Warrants will expire.
Pursuant to the Yorkville Equity Facility Financing, NioCorp will have the right, but not the obligation, to sell Common Shares to Yorkville with a maximum aggregate value of up to US$65.0 million (the “Commitment Amount”) for a period of up to 36 months at a discount to the market price as of the date of each respective issuance, subject to certain limitations and the satisfaction of certain conditions. Upon closing, NioCorp paid US$0.5 million to Yorkville as part of a cash fee, and will pay an additional US$1.0 million in cash to Yorkville in installments over the next 12-months. Further, within five days of closing, NioCorp will issue to Yorkville 81,213 Common Shares as consideration for Yorkville’s irrevocable commitment to purchase Common Shares under the Yorkville Equity Facility Financing.
In connection with closing, NioCorp received approximately US$15.28 million in gross proceeds from the Business Combination. Deal costs are anticipated to be approximately US$20.3 million. NioCorp received an additional US$15.36 million in net proceeds from the Yorkville Convertible Debt Financing. NioCorp also expects to have access to up to an additional $61.6 million in net proceeds from the Yorkville Equity Facility Financing over the next three years. After giving effect to the Business Combination, the Yorkville Convertible Debt Financing and the Yorkville Equity Facility Financing, NioCorp expects to have access to a total of US$71.9 million in net proceeds over the next three years.
NioCorp Board of Directors
Following completion of the Business Combination, Dean C. Kehler and Michael G. Maselli have been appointed to the NioCorp board of directors, joining the seven existing NioCorp board members. Mr. Kehler is a Managing Partner of Trimaran Capital Partners, a manager of private investment funds, and currently serves on the Boards of Directors of Celularity Inc., El Pollo Loco Holdings, Inc. and Portman Ridge Finance Corporation. Mr. Maselli is a Managing Director of Trimaran Capital Partners and the Chairman of the Board of El Pollo Loco Holdings Inc.
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Share Consolidation
The Company also effected a share consolidation (reverse stock split) (the “Consolidation”) of its issued and outstanding Common Shares on the basis of one (1) post-Consolidation Common Share for every ten (10) pre-Consolidation Common Shares. Following completion of the Business Combination and the Consolidation, there are currently 30,000,442 Common Shares issued and outstanding. Further, there are 7,957,404 Class B shares of GXII (now known as Elk Creek Resources Corp.), as the surviving entity of the merger, that are exchangeable for an aggregate of up to 7,957,404 Common Shares and 15,666,667 Assumed Warrants exercisable for an aggregate of up to 17,519,910 Common Shares. All existing convertible securities of the Company have proportionally adjusted as result of the Consolidation, in accordance with their respective terms. The Convertible Debentures and the Financing Warrants were issued following the Consolidation, but have similar terms that provide for proportional adjustment thereof.
The Common Shares and the Assumed Warrants are expected to begin trading on The Nasdaq Global Market and The Nasdaq Capital Market, respectively, on March 21, 2023, under the symbols “NB” and “NIOBW,” respectively. The Common Shares will continue to trade on the Toronto Stock Exchange (“TSX”) under the symbol “NB,” and will continue to trade on a pre-consolidated basis until such time as the TSX advises that trading on a post-consolidated basis will commence, which is expected to be at the beginning of regular trading hours on March 21, 2023. The Common Shares will cease being quoted on the OTC Markets in connection with the commencement of trading on The Nasdaq Global Market.
# # #
For More Information
Contact Jim Sims, Corporate Communications Officer, NioCorp Developments Ltd., (720) 334-7066, jim.sims@niocorp.com
https://www.niocorp.com
About NioCorp
NioCorp is developing a critical minerals project in Southeast Nebraska that will produce niobium, scandium, and titanium. The Company also is evaluating the potential to produce several rare earths from the Project. Niobium is used to produce specialty alloys as well as High Strength, Low Alloy ("HSLA") steel, which is a lighter, stronger steel used in automotive, structural, and pipeline applications. Scandium is a specialty metal that can be combined with Aluminum to make alloys with increased strength and improved corrosion resistance. Scandium is also a critical component of advanced solid oxide fuel cells. Titanium is used in various lightweight alloys and is a key component of pigments used in paper, paint and plastics and is also used for aerospace applications, armor, and medical implants. Magnetic rare earths, such as neodymium, praseodymium, terbium, and dysprosium are critical to the making of Neodymium-Iron-Boron ("NdFeB") magnets, which are used across a wide variety of defense and civilian applications.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable
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Canadian securities laws. Forward-looking statements may include, but are not limited to, the anticipated benefits of the proposed Transactions, including the ability to access the full amount of the expected net proceeds over the next three years; the financial and business performance of NioCorp; NioCorp’s anticipated results and developments in the operations of NioCorp in future periods; NioCorp’s planned exploration activities; the adequacy of NioCorp’s financial resources; NioCorp’s ability to secure sufficient project financing to complete construction and commence operation of the Elk Creek Project; NioCorp’s expectation and ability to produce niobium, scandium and titanium at the Elk Creek Project; the outcome of current recovery process improvement testing, and NioCorp’s expectation that such process improvements could lead to greater efficiencies and cost savings in the Elk Creek Project; the Elk Creek Project’s ability to produce multiple critical metals; the Elk Creek Project’s projected ore production and mining operations over its expected mine life; the completion of the demonstration plant and technical and economic analyses on the potential addition of magnetic rare earth oxides to NioCorp’s planned product suite; the exercise of options to purchase additional land parcels; the execution of contracts with engineering, procurement and construction companies; NioCorp’s ongoing evaluation of the impact of inflation, supply chain issues and geopolitical unrest on the Elk Creek Project’s economic model; the impact of health epidemics, including the COVID-19 pandemic, on NioCorp’s business and the actions NioCorp may take in response thereto; and the creation of full time and contract construction jobs over the construction period of the Elk Creek Project. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.
The forward-looking statements are based on the current expectations of the management of NioCorp and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. Forward-looking statements reflect material expectations and assumptions, including, without limitation, expectations and assumptions relating to: the future price of metals; the stability of the financial and capital markets; and other current estimates and assumptions regarding the Transactions and their benefits. Such expectations and assumptions are inherently subject to uncertainties and contingencies regarding future events and, as such, are subject to change. Forward-looking statements involve a number of risks, uncertainties or other factors that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those discussed and identified in public filings made by NioCorp and GXII with the SEC and, in the case of NioCorp, with the applicable Canadian securities regulatory authorities and the following: the outcome of any legal proceedings that may be instituted against NioCorp or GXII following closing of the Transaction; the inability to access the full amount of net proceeds under the Yorkville Equity Facility Financing over the next three years; the ability to recognize the anticipated benefits of the Transactions; unexpected costs related to the Transactions; the completion of processes required to effect the trading of the Common Shares on a post-Consolidation basis on the TSX and the Nasdaq being delayed; NioCorp’s ability to submit a complete application to begin the EXIM Phase I evaluation process; NioCorp’s ability to pay the necessary fees in connection with the Export-Import Bank of the United States (“EXIM”) underwriting process, including the expenses of EXIM’s or any other lenders’ legal and other advisors and NioCorp’s own advisors; the completion of the Phase I due diligence process and the receipt of a preliminary project letter indicating that EXIM is prepared to undertake Phase II due diligence; the completion of the Phase II due diligence process; the possibility that, even if NioCorp completes the application process, it does not receive a final commitment of financing from EXIM on the anticipated timeline, on acceptable terms, or at all; NioCorp’s ability to operate as a going concern; NioCorp’s requirement of significant additional capital; NioCorp’s limited operating history; NioCorp’s history of losses; cost increases for NioCorp’s exploration and, if warranted, development projects; a disruption in, or failure of, NioCorp’s information technology systems, including those related to cybersecurity; equipment and supply shortages; current and future offtake agreements, joint ventures, and partnerships; NioCorp’s ability
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to attract qualified management; the effects of the COVID-19 pandemic or other global health crises on NioCorp’s business plans, financial condition and liquidity; estimates of mineral resources and reserves; mineral exploration and production activities; feasibility study results; changes in demand for and price of commodities (such as fuel and electricity) and currencies; changes or disruptions in the securities markets; legislative, political or economic developments; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the possibility that actual results of work may differ from projections/expectations or may not realize the perceived potential of NioCorp’s projects; risks of accidents, equipment breakdowns, and labor disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in development programs; operating or technical difficulties in connection with exploration, mining, or development activities; the speculative nature of mineral exploration and development, including the risks of diminishing quantities of grades of reserves and resources; claims on the title to NioCorp’s properties; potential future litigation; and NioCorp’s lack of insurance covering all of NioCorp’s operations.
Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of NioCorp prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.
All subsequent written and oral forward-looking statements concerning the Transactions or other matters addressed in this communication and attributable to NioCorp or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this communication. Except to the extent required by applicable law or regulation, NioCorp undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this communication to reflect the occurrence of unanticipated events.