Item 1.01. Entry into a Material Definitive Agreement.
On June 25, 2021, Advent Technologies Holdings, Inc. (the “Company” or the “Buyer”) entered into a Share Purchase Agreement (the “Purchase
Agreement”), with F.E.R. Fischer Edelstahlrohre GmbH, a limited liability company incorporated under the Laws of Germany (the “Seller”), which provides for the Buyer to acquire (the “Acquisition”) all of the issued and outstanding
equity interests in SerEnergy A/S, a Danish stock corporation and a wholly-owned subsidiary of the Seller (“SerEnergy”) and fischer eco solutions GmbH, a German limited liability company and a wholly-owned subsidiary of the Seller (“FES”
and together with SerEnergy, the “Target Companies”) together with certain outstanding shareholder loan receivables.
Pursuant to the Purchase Agreement, the Company will acquire SerEnergy and FES, the fuel cell systems business of fischer Group. SerEnergy is a leading
manufacturer of methanol-powered high-temperature polymer electrolyte membrane (“HT-PEM”) fuel cells and operates facilities in Aalborg, Denmark and in Manila, Philippines. FES provides fuel-cell stack assembly and testing as well as the production
of critical fuel cell components of the SerEnergy HT-PEM fuel cells, including membrane electrode assemblies, bipolar plates and reformers. FES operates a facility on fischer Group’s campus in Achern, Germany, and Advent has agreed to lease that
respective portion of the facility at the closing of the Acquisition.
The Purchase Agreement, the Acquisition and the other transactions contemplated by the Purchase Agreement (together with the Acquisition, the “Transactions”)
have been unanimously approved by the Board of Directors (the “Board”) of the Company.
Transaction Consideration
As consideration for the Transactions, at the closing of the Acquisition, the Company will pay to the Seller € 52,000,000 subject to customary
cash/debt/working capital adjustments, all based on completion accounts. The preliminary consideration which will be based on estimates of the Target Companies’ cash, debt and working capital will be notified by the Seller shortly before completion.
At completion, a portion of the preliminary consideration will be paid as €15,000,000 in cash (the “Cash Consideration”). The remaining portion of the preliminary consideration will be paid by shares of common stock of the Company to be issued
by the Company to the Seller (the “Share Consideration”), such shares to be valued at the € amount of the volume-weighted arithmetic average of the closing prices of the Company’s stock during the last 20 trading days occurring two trading
days prior to the Transactions’ closing (the “Agreed Share Value”). The Share Consideration is capped to shares representing 9.999% of the Company’s common stock outstanding as of the completion (taking into account the common stock issued as
Share Consideration, the “Cap”). In the event the Share Consideration exceeds the Cap, both the Company and the Seller have a right to terminate the Purchase Agreement upon written notice to the other party. The final consideration will be
determined on the basis of completion accounts. Any balance between the preliminary consideration and the final consideration will be settled either in common shares at the Agreed Share Value or in cash, at the election of the respective debtor.
Representations, Warranties, Covenants and Indemnity
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a)
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Seller’s Representations & Warranties
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The Purchase Agreement contains reasonable and customary representations and warranties relating inter alia to title
in Target Companies shares, financial statements, the operative business, the IP and the IT landscape of the Target Companies as well as to tax. The Seller’s liability for claims under the Purchase Agreement except for fundamental warranties, tax
claims and specific indemnities is capped to (i) 35% of the Cash Consideration (“Cash Liability Cap”) and (ii) 35% of the Share Consideration (“Share Liability Cap”), provided that claims shall first be settled in cash up to Cash
Liability Cap and thereafter in shares in the Company at the Agreed Share Value up to the Share Liability Cap. The Seller’s overall liability under the Purchase Agreement is capped to 100% of the Cash Consideration and of the Share Consideration,
first to be settled in cash and thereafter in shares.
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b)
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Buyer’s Representations & Warranties
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The Purchase Agreement contains reasonable and customary representations and warranties relating inter alia to title
in the Company’s shares, authorized capitalization of Buyer and compliance with the securities laws.
The Purchase Agreement contains inter alia a standard pre-closing conduct of business covenant obliging the Seller
to cause the Target Companies to conduct their business in the ordinary course until the completion date.
Buyer agrees to file a registration statement or amend an existing registration statement on Form S-1 (the “Registration Statement”) registering the
resale of the shares of the Company issued as Share Consideration within thirty (30) calendar days following the closing date and that it shall use commercially reasonable efforts to have the Registration Statement declared effective within 60
(sixty) days following the filing date.
The Purchase Agreement contains certain indemnities by the Seller addressing specific items identified by the Buyer during the due diligence process. It
further contains a tax indemnity by the Seller to hold harmless the Buyer from (i) any damages caused by a breach of the tax warranties or (ii) any taxes payable by the Target Companies until the effective date.
Conditions to the Consummation of the Transactions
The obligation to consummate the Transactions is subject to satisfaction of the following conditions precedent (the “Closing Conditions”): (a) Buyer
has obtained, or is deemed to have obtained, foreign investment control clearance by the German Federal Ministry for Economic Affairs and Energy and, if required, by the Danish Business Authority and/or Ministry for Industry, Business and Financial
Affairs, (b) registration of a short fiscal year with the commercial register of FES, and (c) Buyer has delivered to Seller a substantially final draft of the Registration Statement reasonably satisfactory to the Seller.
Termination
The Purchase Agreement provides for customary termination rights. Either the Seller or the Buyer may withdraw from the Purchase Agreement prior to closing in
particular if (a) not all Closing Conditions have been satisfied within four months after signing of the Purchase Agreement, (b) the Share Consideration exceeds the Cap, (c) the respective other party has failed to perform the closing actions to be
performed by it on the closing date and is in default performing a closing action for more than ten days after closing or (d) if there is an insufficient amount of authorized and unissued Company stock for the Seller to pay the Share Consideration to
the Buyer.
The foregoing summary of the principal terms of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the
full copy of the Purchase Agreement filed as Exhibit 2.1 hereto and incorporated herein by reference. The summary and the copy of the Purchase Agreement are intended to provide information regarding the terms of the Purchase Agreement and are not
intended to modify or supplement any factual disclosures about the Company in its public reports filed with the U.S. Securities and Exchange Commission (“SEC”). The assertions embodied in the representations and warranties included in the Purchase
Agreement were made solely for purposes of the contract between the Company and the Seller and are subject to important qualifications and limitations agreed to by the Company and the Seller in connection with the negotiated terms, including being
qualified by confidential disclosures made by each contracting party to the other for the purposes of allocating contractual risk between them that differ from those applicable to investors. Moreover, some of those representations and warranties may
not be accurate or complete as of any specified date, may be subject to a contractual standard of materiality different from those generally applicable to the Company’s SEC filings or may have been used for purposes of allocating risk among the
Company and the Seller rather than establishing matters as facts. Investors should not rely on the representations and warranties or any description of them as characterizations of the actual state of facts of the Company, Seller or any of their
respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Purchase Agreement, and this subsequent information may or may not be fully reflected in
public disclosures by the Company.