Item 1.01 Entry into a Material Definitive
Agreement.
As previously disclosed,
on August 30, 2021, Parent, entered into an Agreement and Plan of Merger (as amended on May 20, 2022 and June 15, 2022, the “Original
Agreement”) by and among Parent, the Company, Longboard Merger Corp., a Delaware corporation and wholly owned subsidiary of
Parent (“Merger Sub”), and Shareholder Representative Services LLC, a Colorado limited liability company solely in
its capacity as Stockholders’ Representative, pursuant to which Merger Sub was merged with and into the Company (the “Merger”),
with the Company continuing as the surviving corporation in the Merger.
Amended and Restated
Agreement and Plan of Merger
On January 25, 2023,
the parties to the Original Agreement entered into the Merger Agreement. The Merger Agreement amended and restated the Original Agreement
in its entirety to, among other things, provide for the following:
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Certain key definitions in the Merger Agreement were amended, as listed below: |
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“Base Value” means $450,000,000. |
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“Earnout Period” means a period commencing from the Closing Date until December 31, 2027. |
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“Major Stockholder” means any Stockholder holding 33,000 or more shares of the Common Stock. |
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“Special Indemnity Escrow Amount” means $23,368,000. |
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“Target Net Working Capital” means negative $14,599,000. |
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Parent agreed to file the Certificate of Designation of Series C Convertible Preferred Stock with the office of the Secretary of the State Nevada. |
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Parent agreed to loan the Company such amounts as Parent and the Company mutually agree to meet certain operating expenses of the Company (the “Bridge Loans”), including any additional amounts, as described in the Merger Agreement. |
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Parent agreed to use best efforts to enter into a senior credit facility (the “Facility”) in an amount reasonably sufficient to enable the Company to continue business operations as contemplated (the “Facility Amount”) with such terms and conditions that are reasonably acceptable to the board of directors of Parent and the Company. |
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Parent and the Company agreed to the definitions and terms governing registration rights substantially in the form attached hereto as Exhibit 10.1. |
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Parent agreed to reserve and keep available out of Parent’s authorized and unissued shares of preferred stock, for the sole purpose of compliance with the terms of the Merger Agreement. |
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Each Major Stockholder
agreed not sell, assign, or transfer or otherwise dispose of any of the stock consideration issued to such Major Stockholder.
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The Merger Agreement is filed as Exhibit 2.1
to the Original Form 8-K and the foregoing description thereof is qualified in its entirety by reference to the full text of the Merger
Agreement. The Merger Agreement provides investors with information regarding its terms and is not intended to provide any other factual
information about the parties. In particular, the assertions embodied in the representations and warranties contained in the Merger Agreement
were made as of the execution date of the Original Agreement only and are qualified by information in confidential disclosure schedules
and any amendments thereof provided by the parties to each other in connection with the signing of the Original Agreement and Merger Agreement.
These disclosure schedules contain information that modifies, qualifies, and creates exceptions to the representations and warranties
set forth in the Merger Agreement. Moreover, certain representations and warranties in the Merger Agreement may have been used for the
purpose of allocating risk between the parties rather than establishing matters of fact. Accordingly, you should not rely on the representations
and warranties in the Merger Agreement as characterizations of the actual statements of fact about the parties.
First Amendment
to Merger Agreement
On January 31, 2023 (the “Closing Date”), the parties
to the Merger Agreement amended the Merger Agreement as follows:
1. Section 2.6(a) of the Merger Agreement was deleted in its entirety
and replaced with the following:
“Each In-the-Money Option that
is vested and outstanding as of immediately prior to the Effective Time shall be cancelled immediately prior to the Effective Time and
converted into the right to receive a number of shares of Parent Common Stock equal to the Per Share Merger Consideration, less the number
of shares of Parent Common Stock equal to the per share exercise price of such Option, less the number of shares of Parent Common Stock
equal to the value of any applicable Taxes required to be withheld according to applicable Law. At the Effective Time, each Out-of-Money
Option that is outstanding as of the Effective Time, whether or not then vested or exercisable, shall be cancelled and extinguished.”
2. Section 2.6(b) of the Merger Agreement was
deleted in its entirety and replaced with the following:
“At the Effective Time, with respect
to each RSU that shall not vest upon the consummation of the Contemplated Transactions (each such RSU, a “Rollover RSU”)
that is outstanding as of the Effective Time, Parent shall assume all the obligations of the Company under the Company Equity Plan and
the applicable award agreements (including with respect to vesting and termination-related provisions, subject to the adjustment described
in this Section 2.6(b)), except the Rollover RSUs shall be adjusted (each adjusted RSU, an “Adjusted RSU”) such that
the aggregate Adjusted RSUs held by each holder of Rollover RSUs shall relate to such number of shares of Parent Common Stock as is equal
to (i) the number of shares of Common Stock subject to the aggregate Rollover RSUs held by each such holder of Rollover RSUs immediately
prior to the Effective Time, multiplied by (ii) the Per Share Merger Consideration, with any fractional shares rounded down to the nearest
whole share.”
3. Section 2.6(c) of the Merger Agreement was
deleted in its entirety and replaced with the following:
“Each RSU other than a Rollover
RSUs that is outstanding as of immediately prior to the Effective Time shall be cancelled and converted into the right to receive a number
of shares of Parent Common Stock equal to the product of (i) Per Share Merger Consideration, and (ii) the number of shares of Common Stock
subject to the aggregate of such RSUs held by each such holder of RSUs immediately prior to the Effective Time, subject to applicable
withholdings (which the Company and the participant may address via a sell to cover mechanism).”
4. The following defined terms in Section 1.1
of the Merger Agreement was deleted and replaced with the following:
“Special Indemnity Escrow Shares”
means, collectively, (a) that number of shares of Parent Convertible Preferred Stock equal to the Special Indemnity Escrow Amount based
on a valuation of such Parent Convertible Preferred Stock pursuant to the Signing VWAP, and (b) that number of shares of Parent Common
Stock that the holders of RSUs (other than the Rollover RSUs) would otherwise receive upon the cancellation and conversion of such RSUs
pursuant to Section 2.6(c), on a pro rata basis.
“Working Capital Escrow Shares”
means, collectively, (a) that number of shares of Parent Convertible Preferred Stock equal to the Working Capital Escrow Amount based
on a valuation of such Parent Convertible Preferred Stock pursuant to the Signing VWAP, and (b) that number of shares of Parent Common
Stock that the holders of RSUs (other than the Rollover RSUs) would otherwise receive upon the cancellation and conversion of such RSUs
pursuant to Section 2.6(c), on a pro rata basis.
The foregoing description of the First Amendment
to the Merger Agreement is qualified in its entirety by reference to the First Amendment to the Amended and Restated Agreement and Plan
of Merger, a copy of which is included as Exhibit 2.2 to this Amended Form 8-K, and incorporated herein by reference.
Closing of the Merger and Transactions Contemplated
by the Merger Agreement, as amended on January 31, 2023
On the Closing Date, parties to the Merger Agreement
consummated the Merger and transactions contemplated by the Merger Agreement, as amended as of the Closing Date.
Pursunat to the Merger Agreement, each share
of common stock, par value $0.0001 per share, of Merger Sub (“Merger Sub Common
Stock”), was converted into the Closing Consideration Shares (as defined below), of the Company. As consideration for
the exchange of the common stock, the stockholders received an aggregate number of shares of common stock of Parent and convertible
preferred stock of Parent (the “Closing Consideration Shares”). As
promptly as possible, Parent agreed to deliver to the Stockholders’ Representative a statement showing the calculation of (i)
the Closing Cash, Closing Net Working Capital, Closing Indebtedness, and Closing Transaction Expenses; and (ii) the Closing
Consideration Shares substituting the Closing Cash, Closing Net Working Capital, Closing Indebtedness, and Closing Transaction
Expenses as set forth in the Preliminary Statement for the Estimated Closing Cash, Estimated Closing Net Working Capital, Estimated
Closing Indebtedness, and Estimated Closing Transaction Expenses as set forth in the Closing Date Statement, respectively.
Consistent with the aforementioned formula, Closing Consideration Shares consisted of the following: (i)
11,864,890 shares of Parent Common Stock were paid out of Parent Equity Plan upon the Closing, as a direct replacement for equity
incentive grants under the corresponding Company Equity Plan of VIA; (ii) 125,651,614 shares were paid in Parent Common Stock; and
(iii) 1,159,276 shares of Parent Convertible Preferred Stock were issued and such shares of Parent Convertible Preferred Stock have
a conversion ratio of 20:1 and are thus convertible into 23,185,518 shares of Parent Common Stock subject to stockholder approval of
the Preferred Stock Conversion Proposal, and such stockholder approval will be solicited in the Proxy Statement.
As an additional consideration in respect of
the Common Stock and in consideration for achieving certain earnout targets, Parent agreed to pay an aggregate amount up to $180,000,000
(“Earnout Amount”) in the form of Parent Convertible Preferred Stock, to the Stockholders on a pro rata basis. If
the Earnout Amount is paid in the form of Parent Convertible Preferred Stock, Parent agreed to issue to the Stockholders on a pro rata
basis such number of Parent Convertible Preferred Stock equal to the product of (i) the Earnout Amount divided by (ii) the VWAP of the
Parent Convertible Preferred Stock as of the date of such issuance.
Certificate of Designation of Series C Convertible Preferred
Stock
The series of preferred stock created in connection
with the Merger was designated as Series C Convertible Preferred Stock (the “Series C Preferred Stock”) and the number
of shares so designated are 2,000,000. Subject to the Certificate of Designation of Series C Preferred Stock, each share of Series C Preferred
Stock is convertible into 20 shares of Common Stock of Parent. The Series C Preferred Stock does not have dividend rights. Except as otherwise
required by law or expressly provided herein or in the Merger Agreement, each share of Series C Preferred Stock is entitled to vote on
all matters submitted or required to be submitted to a vote of the stockholders of Parent and shall be entitled to the number of votes
equal to the number of whole shares of common stock into which such shares of Series C Preferred Stock are or may be convertible.
The foregoing description of the Series C Preferred
Stock does not purport to be complete and is qualified in its entirety by the terms and conditions of the Certificate of Designation of
Series C Convertible Preferred Stock, a copy of which is attached as Exhibit 3.1 to this Amended Form 8-K, and is incorporated herein
by reference.
Registration Rights Agreement
In connection with the consummation of the Merger,
Parent entered into a registration rights agreement whereby Parent agreed to register Parent Common Stock Payment Shares and any shares
of common stock of Parent that are issuable upon conversion of the Series C Convertible Preferred Stock, in accordance with the terms
attached as Exhibit 10.1 to this Amended Form 8-K.
The foregoing description of the Registration
Rights Agreement does not purport to be complete and is qualified in its entirety by the terms and conditions of the Registration Rights
Agreement, a copy of which is attached as Exhibit 10.1 to this Amended Form 8-K, and is incorporated herein by reference.