UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
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SCHEDULE 14A
INFORMATION
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Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the
Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material under § 240.14a-12
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Gamida Cell
Ltd.
(Name of Registrant as Specified In Its Charter)
____________________________________________________________________________________________________________
(Name of
Person(s) Filing Proxy Statement if other than the
Registrant)
Payment of Filing Fee (Check all boxes that apply):
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No fee required.
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Fee paid previously with preliminary materials.
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Fee computed on table in exhibit required by
Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11
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116 Huntington Avenue, Boston, Massachusetts, 02116
January 10, 2023
Dear Shareholder,
You are cordially invited to attend a special general meeting of
the shareholders (the “Meeting”) of Gamida
Cell Ltd. (the “Company”), to be held
on Tuesday, February 14, 2023, beginning at 5:00 p.m.,
Israel time (10:00 a.m. Eastern Time), at 12 Leshem Street,
Kiryat Gat, 8258412, Israel.
At the time of printing, we expect that shareholders will be able
to attend the Meeting in person. We will continue to monitor the
situation, including Israeli government guidance, and will continue
to do so in the lead up to the Meeting. Should regulations or
government guidance change between now and the date of the Meeting,
the Company will provide an update on its website (https://investors.gamida-cell.com) and
shareholders are encouraged to check for any updates.
Please register for the live webcast of the Meeting at https://register.vevent.com/register/BI0a17f1f7ea234a7bba836e10dadaf18f.
Once registered, you will be provided with a personalized
dial-in number and PIN. A replay of
the webcast will be available for approximately seven days
after the Meeting. No voting will be allowed during the
webcast.
The Company’s notice of the Meeting, as published on Tuesday,
January 10, 2023, and the proxy statement (“Proxy
Statement”) included within the following pages, describe in
detail the matter to be acted upon at the Meeting. This notice and
the accompanying proxy statement and proxy card are being first
mailed to shareholders on or about January 11, 2023.
The Company has fixed the close of business on Thursday,
January 5, 2023 as the record date for the determination of
shareholders entitled to notice of, and to vote on the matter
proposed at, the Meeting and any adjournment or postponement
thereof. The Company’s board of directors unanimously recommends a
vote “FOR” each matter set forth in the notice.
YOUR
VOTE IS IMPORTANT. Whether or not you plan to attend the
Meeting, it is important that your shares be represented and voted
at the Meeting. Accordingly, after reading the enclosed Notice of
Special General Meeting of Shareholders and accompanying Proxy
Statement, please sign, date and mail the enclosed proxy card by
means of the envelope provided, or otherwise vote by telephone or
over the internet in accordance with the instructions given in your
proxy card. Please note, however, that if your shares are held of
record by a broker, bank or other nominee and you wish to vote at
the Meeting, you may need to obtain a proxy issued in your name
from that record holder. Please contact your broker, bank or other
nominee for information about specific requirements if you would
like to vote your shares at the Meeting.
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Important Notice Regarding
the Availability of Proxy Materials
for the Special General Meeting of Shareholders
to Be Held on Tuesday, February 14, 2023 at 5:00 p.m.,
Israel Time (10:00 a.m. Eastern Time).
Register for the Special
General Meeting
via https://register.vevent.com/register/BI0a17f1f7ea234a7bba836e10dadaf18f.
The proxy statement is available at www.proxyvote.com.
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We look forward to seeing as many of you as can attend the
Meeting.
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Very truly yours,
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Robert I. Blum
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Chairman of the Board of Directors
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GAMIDA CELL LTD.
116 Huntington Avenue, Boston, Massachusetts
Tel: (713) 400-6400
NOTICE OF SPECIAL GENERAL MEETING OF SHAREHOLDERS
To be held on Tuesday, February 14, 2023
Notice is hereby given to the holders of ordinary shares, nominal
value NIS 0.01 per share, of Gamida Cell Ltd. (the “Company”)
in connection with the solicitation by the board of directors of
the Company (the “Board”) of proxies for
use at the special general meeting of shareholders (the
“Meeting”) to be held
on Tuesday, February 14, 2023, at 5:00 p.m. Israel
time (10:00 a.m. Eastern Time), at 12 Leshem Street, Kiryat
Gat, 8258412, Israel.
Please register for the live webcast of the Meeting at https://register.vevent.com/register/BI0a17f1f7ea234a7bba836e10dadaf18f.
Once registered, you will be provided with a personalized
dial-in number and PIN. A replay of
the webcast will be available for approximately seven days
after the Meeting. No voting will be allowed via the internet
during the webcast, but shareholders attending the Meeting in
person and eligible to vote may vote their shares during the
Meeting.
The Meeting is being called to approve, in accordance with Listing
Rule 5635(d) of the Nasdaq Stock Market (“Nasdaq”)
and Sections 270(5), 274 and 328(b)(1) of the Israeli
Companies Law 5759-1999, and
regulations promulgated thereunder (the “Companies Law”), the
potential issuance of ordinary shares that may result from exchange
of or payments on the First Lien Secured Note.
The Board recommends that the shareholders vote in favor of the
above proposal, which is described in the accompanying Proxy
Statement. We are currently not aware of any other matters that
will come before the Meeting. If any other matters are presented
properly at the Meeting, it is intended that the persons designated
as proxies will vote upon such matters in accordance with their
best judgment and the interest of the Company.
In accordance with the Companies Law, any shareholder of the
Company holding at least 1% of the outstanding voting rights of the
Company for the Meeting may submit to the Company a proposed
additional agenda item for the Meeting, no later than
January 17, 2023. To the extent that there are any additional
agenda items that the Board determines to add as a result of any
such submission, the Company will publish an updated agenda and
proxy card as well as an amendment to the Proxy Statement with
respect to the Meeting, no later than January 24, 2023.
The presence (in person or by proxy) of any two or more
shareholders holding, in the aggregate, at least 33-⅓% of the
voting power of the Company, constitutes a quorum for purposes of
the Meeting. In the absence of the requisite quorum of shareholders
within half an hour from the time appointed for the Meeting, the
Meeting will be adjourned to Tuesday, February 14, 2023, at
the same time and place, unless otherwise determined at the Meeting
in accordance with the Company’s current Articles of Association.
At such adjourned meeting the presence of one or more shareholders
in person or by proxy within a half an hour from the time appointed
for the adjourned meeting holding in the aggregate at
least 33-⅓% of the voting power of the Company will constitute a
quorum.
Only shareholders of record at the close of business on Thursday,
January 5, 2023, are entitled to notice of, and to vote at,
the Meeting, or at any adjournment or postponement thereof.
The affirmative vote of the holders of a majority of the voting
power represented at the Meeting in person or by proxy and voting
on the proposal, is necessary for the approval of the proposal.
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This Notice of Special General Meeting of Shareholders, together
with the Proxy Statement describing the proposal to be voted upon
at the Meeting along with a proxy card enabling the shareholders to
indicate their vote on the proposal will be mailed on or about
January 11, 2023 to all shareholders entitled to participate
in and vote at the Meeting. This Proxy Statement, Notice of Special
General Meeting of Shareholders and the
accompanying proxy card are available at www.proxyvote.com.
Proxies must be submitted to the Company or to its transfer agent
no later than 5 a.m. Israel Time (12 a.m. Eastern Time)
on the day of the Meeting. Proxies delivered to the Company or
to its transfer agent after such time will be presented to the
chairperson of the Meeting and, at his discretion, may be voted as
specified in the instructions included in such proxies. If your
ordinary shares in the Company are held in “street name” (meaning
held through a bank, broker or other nominee), you will be able to
either direct the record holder of your shares on how to vote your
shares or obtain a legal proxy from the record holder that enables
you to participate in and to vote your shares at the Meeting (or to
appoint a proxy to do so).
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BY ORDER OF THE BOARD OF DIRECTORS
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January 10, 2023
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/s/ Robert I. Blum
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Robert I. Blum
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Chairman of the Board of Directors
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GAMIDA CELL LTD.
116 Huntington Avenue, Boston, Massachusetts 02116
Tel: (713) 400-6400
PROXY STATEMENT
FOR
THE SPECIAL GENERAL MEETING OF SHAREHOLDERS
Tuesday, February 14,
2023
QUESTIONS AND ANSWERS ABOUT
THESE PROXY MATERIALS AND VOTING
Why
am I receiving these materials?
We have sent you these proxy materials because the board of
directors (the “Board”) of Gamida Cell
Ltd., an Israeli company (the “Company”) is
soliciting your proxy to vote at the special general meeting of
shareholders (the “Meeting”), and any
adjournments or postponements of the Meeting. You are invited to
attend the Meeting to vote on the proposal described in this Proxy
Statement. However, you do not need to attend the Meeting to vote
your shares. Instead, you may simply complete, sign and return the
enclosed proxy card, or follow the instructions below to submit
your proxy over the telephone or online.
We intend to mail these proxy materials on or about
January 11, 2023 to all shareholders of record entitled to
vote at the Meeting.
How
do I attend the Meeting?
The Meeting will be held on Tuesday, February 14, 2023,
beginning at 5:00 p.m. Israel time (10:00 a.m. Eastern
Time), at 12 Leshem Street, Kiryat Gat, 8258412, Israel.
Attendance at the Meeting is limited to shareholders of the Company
as of the record date (Thursday, January 5, 2023). Each
shareholder may appoint only one proxy holder or representative to
attend the Meeting on his or her behalf.
If you attend the Meeting, you will be asked to present valid,
government-issued photo
identification, such as a driver’s license. If you are a holder of
record, the top half of your proxy card or your notice is your
admission ticket. If you hold your shares in street name, you will
need proof of ownership to be admitted to the meeting. A recent
brokerage statement or a letter from your bank or broker are
examples of proof of ownership. If you want to vote your shares
held in street name in person, you must get a legal proxy in your
name from the broker, bank or other nominee that holds your shares,
and submit it with your vote.
Who
can vote at the Meeting?
Shareholders Entitled to
Vote — Record Date
Shareholders of record who held ordinary shares at the close of
business on Thursday, January 5, 2023, are entitled to notice
of, and to vote at, the Meeting. In addition, shareholders who, as
of the Record Date, held ordinary shares through a bank, broker or
other nominee which is a shareholder of record of the Company at
the close of business on the Record Date, or which appears in the
participant list of a securities depository on that date, are
considered to be beneficial owners of shares held in “street name.”
These proxy materials are being forwarded to beneficial owners by
the bank, broker or other nominee that is considered the holder of
record with respect to the Company’s ordinary shares. Beneficial
owners have the right to direct how their shares should be voted
and are also invited to attend the Meeting, but may not actually
vote their shares in person at the Meeting unless they first obtain
a signed proxy from the record holder (that is, their bank, broker
or other nominee) giving them the right to vote the shares.
As of January 5, 2023 (being the last practicable date before the
circulation of this proxy statement), there were 74,583,026
ordinary shares outstanding and entitled to vote at the
Meeting.
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What
am I voting on?
This Proxy Statement describes the proposal on which we would like
you, as a shareholder, to vote at the Meeting. This Proxy Statement
provides you with information on the proposal, as well as other
information about us, so that you can make an informed decision as
to whether and how to vote your shares.
At the Meeting, shareholders will act upon the following
proposal:
Proposal One
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To approve the potential issuance of ordinary shares that may
result from exchange of or payments on the First Lien Secured Note
that the Company issued on December 12, 2022.
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What
if another matter is properly brought before the
Meeting?
As of the date of this Proxy Statement, the Board knows of no other
matters that will be presented for consideration at the Meeting. If
any other matters are properly brought before the Meeting, it is
the intention of your proxyholder (identified on your proxy card)
to vote on those matters in accordance with their best
judgment.
Can I revoke or change
my vote after submitting my proxy?
A shareholder may revoke a proxy in one of the following ways:
(i) by written notice of the revocation of the proxy delivered
by mail to the Company at its offices at 116 Huntington Avenue,
Boston, Massachusetts 02116, Attention: Josh Patterson, General
Counsel & Chief Compliance Officer, or by e-mail to legalnotices@gamida-cell.com, or to its transfer agent, Broadridge
Corporate Issuer Solutions, Inc., by mail to 1717 Arch St., Suite
1300, Philadelphia, Pennsylvania 19103, no later than 5 a.m.
Israel Time (12 a.m. Eastern Time) on the day of the
Meeting, canceling the proxy or appointing a different proxy,
(ii) by written notice of the revocation of the proxy
delivered at the Meeting to the chairman of the Meeting or
(iii) by attending and voting in person at the
Meeting. No proxy will be
accepted after the Meeting. Attendance at the Meeting will not in
and of itself constitute revocation of a proxy. If your shares are
held by your broker, bank or other nominee, you should follow the
instructions provided by your broker, bank or other nominee.
What
is the quorum requirement, and how many votes are needed to approve
each proposal?
Pursuant to the Company’s Articles of Association (the
“Current Articles”),
the quorum required for the Meeting consists of at least one or
more shareholders present, in person or by proxy, holding shares
conferring in the aggregate at least 33-⅓% of the Company’s voting
power. If a quorum is not present within half an hour from the time
appointed for the Meeting, the Meeting will stand adjourned to
February 14, 2023, at the same time and place, unless
otherwise determined at the Meeting in accordance with the
Company’s Current Articles (the “Adjourned Meeting”).
At such Adjourned Meeting the presence of at least one or more
shareholders, in person or by proxy, within half an hour from the
time appointed for the Adjourned Meeting holding in the aggregate
at least 33-⅓% of the Company’s voting power, will constitute a
quorum.
Abstentions and “broker non-votes” are
counted as present and entitled to vote for purposes of determining
a quorum. A “broker non-vote” occurs
when a bank, broker or other holder of record holding shares for a
beneficial owner attends the Meeting but does not vote on a
particular proposal because that holder does not have discretionary
voting power for that particular item and has not received
instructions from the beneficial owner. Brokers that hold shares in
“street name” for clients typically have authority to vote on
“routine” proposals even when they have not received instructions
from beneficial owners. Absent specific instructions from the
beneficial owner of the shares, however, brokers are not allowed to
exercise their voting discretion with respect to any proposals that
are considered non-routine. If you
hold your shares in “street name” and do not provide your broker
with specific instructions regarding how to vote on any proposal,
your broker will not be permitted to vote your shares on the
proposal, resulting in a “broker non-vote.” Therefore, it is important for a
shareholder that holds ordinary shares through a bank or broker to
instruct its bank or broker how to vote its shares, if the
shareholder wants its shares to count for all proposals.
The affirmative vote of the holders of a majority of the voting
power represented at the Meeting in person or by proxy and voting
thereon is necessary for the approval of each proposal.
The Board recommends shareholders vote “FOR” the proposal set
forth in the Proxy Statement.
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Except for the purpose of determining a quorum, broker
non-votes will not be counted as
present and are not entitled to vote. Abstentions will not be
treated as either a vote “FOR” or “AGAINST” a matter.
On the matter submitted to the shareholders for consideration at
the Meeting, only ordinary shares that are voted on such matter
will be counted toward determining whether shareholders approved
the matter. Ordinary shares present at the Meeting that are not
voted on a particular matter (including broker non-votes) will not be counted in determining whether
such matter is approved by shareholders.
Each ordinary share is entitled to one vote on each proposal or
item that comes before the Meeting. If two or more persons are
registered as joint owners of any ordinary share, the right to vote
at the Meeting and/or the right to be counted as part of the quorum
thereat will be conferred exclusively upon the more senior among
the joint owners attending the meeting in person or by proxy. For
this purpose, seniority will be determined by the order in which
the names appear in the Company’s Register of Shareholders.
How
do I vote?
You can vote your shares by attending the Meeting. If you do not
plan to attend the Meeting, the method of voting will differ for
shares held as a record holder and shares held in “street name”
(through a broker, trustee or nominee). Record holders of shares
will receive proxy cards. Holders of shares in “street name” will
receive either proxy cards or voting instruction cards directly
from their bank, broker or nominee in order to instruct their
banks, brokers or other nominees on how to vote.
Ms. Abigail Jenkins, Mr. Joshua Patterson and Mr. Shai
Lankry may be appointed as proxies by the shareholders entitled to
vote at the Meeting with respect to the matter to be voted upon at
the Meeting.
All ordinary shares represented by properly executed proxies
delivered to the Company by mail at its offices at 116 Huntington
Avenue, Boston, Massachusetts 02116, Attention: Josh Patterson,
General Counsel & Chief Compliance Officer, or by
e-mail to
legalnotices@gamida-cell.com, or to
its transfer agent, Broadridge Corporate Issuer Solutions, Inc., by
mail to 1717 Arch St., Suite 1300, Philadelphia, Pennsylvania
19103, will be voted as specified in the instructions indicated in
such proxies. Proxies must be submitted to the Company or to its
transfer agent no later than 5 a.m. Israel Time (12 a.m.
Eastern Time) on the day of the Meeting. Proxies delivered to
the Company or to its transfer agent after such time will be
presented to the chairperson of the Meeting and, at his discretion,
may be voted as specified in the instructions included in such
proxies. If you are a shareholder of record as of the record date
for the Meeting, subject to applicable law and Nasdaq rules, if no
instructions are indicated in such proxies with respect to the
proposal, the shares represented by properly executed and received
proxies will be voted “FOR” the proposal. If you hold your shares
in “street name” through a broker, bank or other nominee, you are
considered, with respect to those shares, a beneficial owner.
Absent specific instructions from the beneficial owner of the
shares, brokers are not allowed to exercise their voting discretion
with respect to any items presented at the Meeting, as described
below.
Shareholders of
Record
If you are a shareholder of record (that is, you hold a share
certificate that is registered in your name or you are listed as a
shareholder in the Company’s share register), you can submit your
vote by completing, signing and submitting a proxy card, which has
or will be sent to you and which will be accessible at the
Investors & Media section of the Company’s website, as
described below under “Availability of Proxy Materials.”
Please follow the instructions on the proxy card. If you provide
specific instructions (by marking a box) with regard to the
proposal, your shares will be voted as you instruct. The persons
named as proxies in the enclosed proxy card will furthermore vote
in accordance with their best judgment on any other matters that
may properly come before the Meeting.
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Shareholders Holding in
“Street Name”
If you hold ordinary shares in “street name,” that is, you are an
underlying beneficial holder who holds ordinary shares through a
bank, broker or other nominee, the voting process will be based on
your directing the bank, broker or other nominee to vote the
ordinary shares in accordance with the voting instructions on your
voting instruction card. Because a beneficial owner is not a
shareholder of record, you may not vote those shares directly at
the Meeting unless you obtain a “legal proxy” from the bank, broker
or nominee that holds your shares, giving you the right to vote the
shares at the Meeting.
Please follow the instructions on the voting instruction card
received from your bank, broker or nominee. You may also be able to
submit voting instructions to a bank, broker or nominee by phone or
via the Internet if your voting instruction card describes such
voting methods. Please be certain to have your control number
from your voting instruction card ready for use in providing your
voting instructions.
It is important for a shareholder that holds ordinary shares
through a bank or broker to instruct its bank or broker how to vote
its shares if the shareholder wants its shares to count for the
proposal.
How
can I find out the Meeting voting results?
The preliminary voting results will be announced at the Meeting.
The final voting results will be tallied by the Company’s General
Counsel based on the information provided by the Company’s transfer
agent or otherwise and will be published following the Meeting on a
Current Report on Form 8-K that we expect to file with the
U.S. Securities and Exchange Commission (the “SEC”)
within four business days after the Meeting. If voting
results are not available to us in time to file a Current Report on
Form 8-K within
four business days after the Meeting, we intend to file a
Current Report on Form 8-K to publish preliminary results and, within
four business days after the final results are known to
us, file an additional Report on Form 8-K to publish the final results.
Who
is paying for this proxy solicitation?
The Company will bear the costs of solicitation of proxies for the
Meeting, including the preparation, assembly, printing, mailing and
distribution of the proxy materials. In addition to solicitation by
mail, directors, officers and employees of the Company may solicit
proxies from shareholders by telephone, personal interview or
otherwise. Such directors, officers and employees will not receive
additional compensation, but may be reimbursed for reasonable
out-of-pocket expenses in connection with such
solicitation. Brokers, nominees, fiduciaries and other custodians
have been requested to forward soliciting material to the
beneficial owners of ordinary shares held of record by them, and
such custodians will be reimbursed by the Company for their
reasonable out-of-pocket expenses. The Company may also retain
an independent contractor to assist in the solicitation of proxies.
If retained for such services, the costs will be paid by the
Company. Proxies must be submitted to the Company or to its
transfer agent no later than 5 a.m. Israel Time (12 a.m.
Eastern Time) on the day of the Meeting. Proxies delivered to
the Company or to its transfer agent after such time will be
presented to the chairperson of the Meeting and, at his discretion,
may be voted as specified in the instructions included in such
proxies.
What
proxy materials are available online?
Copies of the proxy card, the Notice of Special General Meeting of
Shareholders and this Proxy Statement are available at www.proxyvote.com.
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PROPOSAL
ONE
APPROVAL OF THE POTENTIAL ISSUANCE OF ORDINARY SHARES THAT MAY
RESULT FROM EXCHANGE OF OR PAYMENTS ON THE FIRST LIEN SECURED
NOTE
Background
As previously disclosed, on December 12, 2022, the Company, as
guarantor, and, its wholly owned subsidiary, Gamida Cell Inc., as
borrower (the “Borrower”), entered
into a Loan and Security Agreement (the “Loan Agreement”) with
a fund managed by Highbridge Capital Management, LLC (collectively,
“Highbridge”), as the
lender (together with the other lenders from time to time party
thereto, the “Lenders”), and
Wilmington Savings Fund Society, FSB, as collateral agent and
administrative agent.
Pursuant to the Loan Agreement, the Borrower borrowed an aggregated
principal amount of $25.0 million through the issuance and
sale of a First Lien Secured Note, which was issued with an
original issue discount of 3.00%. The Company expects to use the
proceeds of the First Lien Secured Note for: (i) commercial
readiness activities to support potential launch of omidubicel, if
approved; (ii) the continued clinical development of the
Company’s NK product candidates, including GDA-201; and (iii) general corporate purposes,
including general and administrative expenses and working
capital.
The First Lien Secured Note is exchangeable, at the option of the
Lenders, into the Company’s ordinary shares at an exchange rate of
0.52356 ordinary shares per $1.00 principal amount, together with a
make-whole premium equal to all
accrued and unpaid and remaining coupons due through
December 12, 2024 (the “Make-Whole
Amount”). The exchange
rate is subject to adjustment in the event of ordinary share
dividends, reclassifications and certain other fundamental
transactions affecting the ordinary shares.
The Company has fully and unconditionally guaranteed the
obligations of the Borrower under the Loan Agreement and the First
Lien Secured Note. The obligations under the Loan Agreement and the
First Lien Secured Note are secured by substantially all assets of
the Company and its subsidiaries.
The Loan Agreement and the First Lien Secured Notes will mature on
December 12, 2024 (the “Maturity Date”),
unless earlier repurchased, redeemed or exchanged in accordance
with the terms, and bear interest at the annual rate of 7.50%,
payable on a quarterly basis, with the interest rate increasing to
12.00% at any time upon any event of default under the Loan
Agreement or certain failures to register the resale of the
ordinary shares issuable pursuant to the First Lien Secured
Note.
Commencing four months after the closing date for the Loan
Agreement, the Company shall make monthly installment payments in
an amount equal to (a) a ratable amount of the outstanding
principal amount of the Loan Agreement divided by the
remaining months to Maturity Date plus (b) accrued and
unpaid interest on such amount. Such installment payments will also
include a 5% prepayment premium on the principal being repaid (the
“Repayment
Premium”).
Subject to certain conditions, the First Lien Secured Note will be
immediately callable by the Company at any time at a redemption
price equal to (a) 100% of the principal amount of the Loan
Agreement to be redeemed, plus (b) the Make-Whole Amount, and (c) the Repayment Premium.
Also subject to certain conditions (including the effectiveness of
a registration statement on Form S-3),
at the Borrower’s option, principal amortization payments,
interest, the Make-Whole Amount and
the Repayment Premium payable in respect of principal amortization
payments may be paid in ordinary shares, which will be valued at
95% of the volume weighted average price over the ten
preceding trading days. Such payments are referred to herein
as the “Company Repayment
Exchange.” Because the price of the ordinary shares issuable
in a Company Repayment Exchange cannot be calculated until the time
of such an exchange, the maximum number of shares issuable in a
Company Repayment Exchange cannot be calculated as of the date of
issuance of the First Lien Secured Note and it is possible that the
Company would be called to issue in excess of 19.99%, 25% or 45%,
as the case may be, of the Company’s pre-transaction total ordinary shares
outstanding.
Upon satisfying certain conditions, the Borrower may elect to
exchange the outstanding principal amount of the First Lien Secured
Notes into ordinary shares at the exchange ratio, together with the
Repayment Premium and the Make-Whole
Amount applicable to the principal being exchanged. This exchange
option shall not exceed $5,000,000 at any one time, and the
aggregate principal amount of the First Lien Secured Note exchanged
shall not exceed
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$10,000,000 within any one-month
period, and there must be at least 15 trading days between
each exchange option. If the Borrower or the Lenders elect to
exchange any of the First Lien Secured Note, the amount exchanged
will be equal to the principal and unpaid accrued interest plus the
Repayment Premium and the Make-Whole
Amount.
The Loan Agreement contains customary representations and
warranties and covenants, including a $20.0 million minimum
liquidity covenant and certain negative covenants restricting,
among other actions, mergers and acquisitions, indebtedness,
transactions with affiliates, compliance with laws, and issuances
of capital stock. Most of these restrictions are subject to certain
minimum thresholds and exceptions. Certain of the negative
covenants will terminate when less than $5.0 million of
principal amount is outstanding under the Loan Agreement.
The Loan Agreement also contains customary events of default, after
which the obligations under the Loan Agreement and the First Lien
Secured Note may be due and payable immediately, including, without
limitation, payment defaults, material inaccuracy of
representations and warranties, covenant defaults, material adverse
changes, bankruptcy and insolvency proceedings, cross-defaults to certain other agreements, judgments
against us, change of control, termination of any guaranty,
governmental approvals, and lien priority.
In connection with the First Lien Secured Note, the Company entered
into a registration rights agreement, pursuant to which the Company
has agreed to register the resale of the ordinary shares issuable
in accordance with the terms of the First Lien Secured Note.
Purpose
The number of ordinary shares issuable in connection with the First
Lien Secured Note, including the shares issuable as payment of
principal amortization, interest, the Make-Whole Amount and the Repayment Premium payable in
respect of principal amortization payments of principal and in the
satisfaction of make-whole
obligations, may equal or exceed 20%, 25% or 45%, as the case may
be, of the Company’s pre-transaction
total outstanding ordinary shares. Accordingly, the Company is
convening a special general meeting of its shareholders to solicit
their approval for this Proposal to allow the Company to issue more
than 19.99%, 25% or 45%, as the case may be, of its pre-transaction total outstanding ordinary shares
upon exchange of, or payment on, the First Lien Secured Note.
Without shareholder approval of this proposal, the Company is
limited in its ability to exercise its option to repay the First
Lien Secured Note through a Company Repayment Exchange. The maximum
number of shares underlying the First Lien Secured Note cannot be
calculated at this time because the value of the ordinary shares
issued under the Company Repayment Exchange will be set at 95% of
the volume weighted average price over the ten
preceding trading days. Absent the shareholders’ approval of
this Proposal, the Company may not issue more than 14,868,724
ordinary shares in connection with exchanges of or payments on the
First Lien Secured Note.
Our ordinary shares are currently listed on the Nasdaq Capital
Market and trades under the ticker symbol “GMDA.” As such, we are
subject to Nasdaq Marketplace Rules. Nasdaq Listing
Rule 5635(d) requires us to obtain shareholder approval
prior to the sale, issuance or potential issuance of ordinary
shares (or securities convertible into or exercisable for ordinary)
in connection with a transaction other than a public offering at a
price less than the “Minimum Price” which either alone or together
with sales by officers, directors or substantial shareholders of
the company equals 20% or more of the ordinary shares or 20% or
more of the voting power outstanding before the issuance. For
Nasdaq purposes, “Minimum Price” means a price that is the lower
of: (a) the Nasdaq Official Closing Price (as reflected on
Nasdaq.com) immediately preceding the signing of the binding
agreement; or (b) the average Nasdaq Official Closing Price of
the ordinary shares (as reflected on Nasdaq.com) for the
five trading days immediately preceding the signing of the
binding agreement. In determining whether multiple issuances should
be aggregated for purposes of Nasdaq Listing Rule 5635(d),
Nasdaq will consider several factors, including the timing of the
issuances. The Companies Law places similar limitations on private
placements of shares representing 20% or more of the voting power
of a company prior to such issuance.
Additionally, the Companies Law provides that an acquisition of
shares of an Israeli public company must be made by means of a
special tender offer if, as a result of the acquisition, the
purchaser would become a holder of 25% or more of the voting rights
in the company. This requirement does not apply if there is already
another holder of 25% or more of the voting rights in the company.
Similarly, the Companies Law provides that an acquisition of shares
of an Israeli public company must be made by means of a special
tender offer if, as a result of the acquisition, the purchaser
would become a holder of more than 45% of the voting rights in the
company, if there is no other shareholder of the
6
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company who holds more than 45% of the voting rights in the
company. These requirements do not apply if: (a) the
acquisition occurs in the context of a private placement by the
company that received shareholder approval as a private placement
whose purpose is to give the purchaser 25% or more of the voting
rights in the company, if there is no person who holds 25% or more
of the voting rights in the company or as a private placement whose
purpose is to give the purchaser 45% of the voting rights in the
company, if there is no person who holds 45% of the voting rights
in the company; (b) the acquisition was from a shareholder
holding 25% or more of the voting rights in the company and
resulted in the purchaser becoming a holder of 25% or more of the
voting rights in the company; or (c) the acquisition was from
a shareholder holding more than 45% of the voting rights in the
company and resulted in the purchaser becoming a holder of more
than 45% of the voting rights in the company.
Given the foregoing, the Company is requesting in this Proposal
that its shareholders approve, in accordance with Nasdaq Listing
Rule 5635(d) and Sections 270(5) and 274 of the
Companies Law, the potential issuance of ordinary shares
representing 20% or more of the Company’s pre-transaction total outstanding ordinary shares
upon exchange of or payment on the First Lien Secured Note. The
Company is also requesting in this Proposal that its shareholders
approve, in accordance with Section 328(b)(1) of the
Companies Law, the potential issuance of ordinary shares
representing more than 25% or 45% of the Company’s ordinary shares
upon exchange of or payment on the First Lien Secured Note.
Shareholder approval of these measures will allow the Company to
exercise the Company Repayment Exchange to exchange the principal
amount of the First Lien Secured Note for ordinary shares and to
make payments of interest on the First Lien Secured Note in
ordinary shares rather than using the Company’s cash.
Interest of Highbridge in
this Proposal
As of January 5, 2023, Highbridge beneficially owned 8,195,027
ordinary shares, including 4,222,973 ordinary shares issuable upon
exchange of senior exchangeable notes issued on February 16,
2021 (the “Senior Notes”) and
3,972,054 ordinary shares issuable upon exchange of or payment on
the Note. Based on such holdings, Highbridge beneficially owned
9.9% of the Company’s outstanding ordinary shares as of January 5,
2023. If this Proposal is approved, the Company may issue to
Highbridge ordinary shares representing 20%, 25%, or 45%, or more
as the case may be, of the Company’s pre-transaction total ordinary shares outstanding on
exchange of or payments on the First Lien Secured Note.
Per the terms of the Senior Notes and the Note, and without a valid
waiver by the respective lender, no ordinary shares may be issued
pursuant to the Senior Notes or the Note to the extent such
issuance would result in the holder and its affiliates, together
with any other persons whose beneficial ownership would be
aggregated for purposes of Section 13(d) of the Exchange Act or any
group of which any such person is a member, beneficially owning in
excess of 9.9% of the Company’s outstanding ordinary shares.
Impact on Current
Shareholders if this Proposal is Approved
If the Company’s shareholders approve this Proposal, any future
issuance of ordinary shares upon exchange of or payment on the
First Lien Secured Note would no longer be subject to the
limitations imposed by Nasdaq Listing Rule 5635(d) and by
Sections 270(5), 274 and 328(b)(91) of the Companies Law.
Removal of the foregoing limitations would provide the Company with
much needed flexibility to exercise the Company Repayment Exchange
should the Company find that it is in its best interest to do so
based on market conditions or other factors. If this proposal is
approved, the Company’s shareholders will be exposed to the risk
that the Company will issue ordinary shares representing 20%, 25%,
or 45%, or more as the case may be, of the Company’s
pre-transaction total ordinary shares,
which would mean that the Company’s existing shareholders will
experience substantial dilution of their holdings. Such an issuance
would also mean that the Highbridge would own a substantial amount
of the Company’s ordinary shares and thereby have influence over
corporate decisions.
Effect on Current
Shareholders if this Proposal is not Approved
If the Company’s shareholders do not approve this Proposal, the
Company and the Lenders will not be able to convert the First Lien
Secured Note into ordinary shares in all cases. Accordingly, the
Board believes that it is in the Company’s best interest, and in
the best interest of its shareholders, to approve the potential
issuance of ordinary shares representing 20%, 25%, or 45%, or more
as the case may be, of the Company’s pre-transaction total ordinary shares outstanding
that may result from exchange of or payments on the First Lien
Secured Note.
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Absent approval of this Proposal, the Company is limited in the
number of ordinary shares available to satisfy the share issuances
that are otherwise permitted in connection with the First Lien
Secured Note. Therefore, the Company will be left with limited
financial and corporate flexibility with respect to its ability to
satisfy obligations under the First Lien Secured Note with ordinary
shares and may be forced to satisfy such obligations with cash,
which could have a material adverse effect on the Company’s
financial condition.
Board of Directors
Recommendation
In reaching its determination to approve this Proposal, the Board,
with advice from management and financial and legal advisers,
considered a number of factors, including:
• that
it is in the Company’s best interests, and that of the Company’s
shareholders, that the Company have the flexibility to issue 20%,
25%, 45%, or more of its pre-transaction total outstanding ordinary shares on
exchange of or payment on the First Lien Secured Note;
• that
the terms of any proposed transaction available to the Company in
the future are likely to worsen as the maturity date of the First
Lien Secured Note approaches; and
• the
Company’s current financial condition, cash flow and liquidity,
including its outstanding debt obligations.
After evaluating these factors, and based upon their knowledge of
the Company’s business, financial condition and prospects,
potential financing alternatives (or lack thereof), and the views
of the Company’s management, the Board concluded that the potential
issuance of ordinary shares representing 20%, 25%, or 45%, or more
as the case may be, of the Company’s pre-transaction total ordinary shares outstanding
that may result from exchange of or payments on the First Lien
Secured Note is in the Company’s best interests and in the best
interests of its shareholders.
Proposed
Resolution
The Board is therefore proposing to adopt the following
resolution:
“RESOLVED, to approve
the potential issuance of ordinary shares representing 20%, 25%, or
45%, or more as the case may be, of the Company’s pre-transaction total ordinary shares outstanding
that may result from exchange of or payments on the First Lien
Secured Note that the Company issued on December 12,
2022.”
8
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SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
ownership of the Company’s ordinary shares as of January 5, 2023
by: (i) each director and nominee for director; (ii) each
named executive officer; (iii) all executive officers and
directors of the Company as a group; and (iv) all those known
by the Company to be beneficial owners of more than five percent of
its ordinary shares. Beneficial ownership, for purposes of this
table, includes options and warrants to purchase ordinary shares
that are either currently exercisable or will be exercisable within
60 days of January 5, 2023 as well as exchangeable senior
notes that are currently exchangeable or will be exchangeable
within 60 days of January 5, 2023.
Unless otherwise noted below, the address of each shareholder,
director and executive officer is c/o Gamida Cell Ltd., 116
Huntington Avenue, Boston, Massachusetts 02116.
|
|
As of January 5,
2023(1)
|
|
|
Ordinary
Shares
|
|
%
|
Holders of more than 5% of
the Company’s voting securities:
|
|
|
|
|
|
Access Industries(2)
|
|
9,742,857
|
|
13.1
|
%
|
Highbridge Capital Management, LLC and certain related
entities(3)
|
|
8,195,027
|
|
9.9
|
%
|
Fidelity Management & Research(4)
|
|
4,603,945
|
|
6.2
|
%
|
Directors and executive
officers who are not 5% holders:
|
|
|
|
|
|
Abigail Jenkins
|
|
—
|
|
*
|
|
Shai Lankry
|
|
337,570
|
|
*
|
|
Michele Korfin
|
|
396,929
|
|
*
|
|
Josh Patterson
|
|
118,390
|
|
*
|
|
Robert I. Blum
|
|
77,625
|
|
*
|
|
Anat Cohen-Dayag
|
|
23,000
|
|
*
|
|
Julian Adams
|
|
1,068,496
|
|
1.4
|
%
|
Naama Halevi Davidov
|
|
23,000
|
|
*
|
|
Kenneth I. Moch
|
|
61,875
|
|
*
|
|
Shawn Tomasello
|
|
43,875
|
|
*
|
|
Stephen Wills
|
|
43,875
|
|
*
|
|
Ronit Simantov
|
|
357,626
|
|
*
|
|
Ivan Borrello
|
|
9,500
|
|
*
|
|
All
directors and executive officers as a group (13
persons)(5)
|
|
2,561,761
|
|
3.4
|
%
|
9
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10
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SHAREHOLDER
PROPOSALS FOR THE ANNUAL MEETING
It is contemplated that the next annual general meeting of
shareholders will be held on or about May 17, 2023, which
is earlier in the year as compared to our 2022 annual general
meeting of shareholders, which was held on July 27, 2022.
Any Shareholder or Shareholders of the Company holding at least 1%
of the voting rights of the Company (the “Proposing
Shareholder(s)”) may request, subject to the Companies Law, that
the Board include a matter on the agenda of a general meeting to be
held in the future, including to nominate a candidate to serve on
the Board of the Company, provided that the Board determines that
the matter is appropriate to be considered at a general meeting. In
order for the Board to consider a shareholder proposal and whether
to include the matter stated therein in the agenda of a general
meeting, notice of the shareholder proposal must be timely
delivered in accordance with the Companies Law and the regulations
thereto and must comply with the requirements of the Current
Articles and any applicable law and stock exchange rules and
regulations. To be considered timely, a shareholder proposal must
be delivered within seven days following the Company’s notice
of convening a shareholders’ general meeting at which Directors are
to be elected and certain other proposals are to be considered (or
within three days of the Company’s notice in other instances).
The proposal must be in writing, signed by all of the Proposing
Shareholder(s) making such request, delivered, either in
person or by certified mail, postage prepaid, and received by the
Secretary of the Company (or, in the absence thereof by the Chief
Executive Officer). In addition, shareholders that intend to
solicit proxies in support of director nominees other than our
nominees for future shareholder meetings must comply with the
additional requirements of Rule 14a-19(b) of the Securities
Exchange Act of 1934, as amended (the
“Exchange Act”).
In addition to the eligibility requirements under applicable law,
the Company’s Current Articles specify additional procedural
requirements for shareholder proposals. Each such notice shall set
forth: (i) the name, address, telephone number, fax number and
email address of the Proposing Shareholder making the request
(or each such Proposing Shareholder, as the case may be) and,
if an entity, the name(s) of the person(s) that controls
or manages such entity; (ii) the number of shares held by the
Proposing Shareholder(s) making the request, directly or
indirectly (and, if any of such ordinary shares are held
indirectly, an explanation of how they are held and by whom), which
shall be in such number no less than as is required to qualify as a
Proposing Shareholder, accompanied by evidence satisfactory to the
Company of the record holding of such ordinary shares by the
Proposing Shareholder(s) as of the date of the proposal
request, and a representation that the Proposing
Shareholder(s) intends to appear in person or by proxy at the
meeting; (iii) the matter requested to be included on the
agenda of the general meeting, all information related to such
matter, the reason that such matter is proposed to be brought
before the general meeting, the complete text of the resolution
that the Proposing Shareholder proposes to be voted upon at the
general meeting and, if the Proposing Shareholder wishes to have a
position statement in support of the proposal request, a copy of
such position statement that complies with the requirement of any
applicable law (if any); (iv) a description of all
arrangements or understandings between the Proposing
Shareholder(s) and any other person(s) (naming such
person(s)) in connection with the matter that is requested to be
included on the agenda and a declaration signed by all Proposing
Shareholder(s) of whether any of them has a personal interest
in the matter and, if so, a description in reasonable detail of
such personal interest; (v) a description of all derivative
transactions (as defined in the Current Articles) by each Proposing
Shareholder(s) during the previous twelve (12) month
period, including the date of the transactions and the class,
series and number of securities involved in, and the material
economic terms of, such derivative transactions; and (vi) a
declaration that all of the information that is required under the
Companies Law and any other applicable law and stock exchange rules
and regulations to be provided to the Company in connection with
such matter, if any, has been provided to the Company. Furthermore,
the Board, may, in its discretion, to the extent it deems
necessary, request that the Proposing Shareholder(s) provide
additional information necessary so as to include a matter in the
agenda of a general meeting, as the Board may reasonably
require.
Shareholder proposals may also be submitted for inclusion in a
proxy statement under Rule 14a-8
under the Exchange Act. Under Rule 14a-8 of the Exchange Act, to be eligible for
inclusion in the Company’s proxy materials for the 2023 Annual
General Meeting of Shareholders, shareholder proposals must be
received by the Company no later than February 23, 2023, which
is 120 days prior to the 12-month
anniversary of the date this proxy statement was first released to
shareholders with respect to the 2022 Meeting. In addition,
Rule 14a-8 proposals must
otherwise comply with the requirements of the rule.
11
Table of
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Additional requirements regarding shareholder proposals submitted
for inclusion in the Company’s proxy materials for an annual
general meeting can be found in the Current Articles, which are
available as an exhibit to our Annual Report on
Form 10-K for the year ended
December 31, 2021, as filed on March 24, 2022
(the “Annual Report”).
Proposals should be addressed to: at 116 Huntington Avenue, Boston,
Massachusetts 02116, Attention: Josh Patterson, General
Counsel & Chief Compliance Officer, or by e-mail to legalnotices@gamida-cell.com.
12
Table of
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HOUSEHOLDING
OF PROXY MATERIALS
The SEC has adopted rules that permit companies and intermediaries
(e.g., brokers) to satisfy the delivery requirements for meeting
materials with respect to two or more shareholders sharing the same
address by delivering a single set of meeting materials addressed
to those shareholders. This process, which is commonly referred to
as “householding,” potentially means extra convenience for
shareholders and cost savings for companies.
This year, a number of brokers with account holders who are
shareholders will be “householding” the Company’s proxy materials.
A single set of meeting materials will be delivered to multiple
shareholders sharing an address unless contrary instructions have
been received from the affected shareholders. Once you have
received notice from your broker that they will be “householding”
communications to your address, “householding” will continue until
you are notified otherwise or until you revoke your consent. If, at
any time, you no longer wish to participate in “householding” and
would prefer to receive a separate set of meeting materials, please
notify your broker or us. Direct your written request to 116
Huntington Avenue, Boston, Massachusetts 02116, Attention: Josh
Patterson, General Counsel & Chief Compliance Officer, or
by e-mail to
legalnotices@gamida-cell.com.
Shareholders who currently receive multiple copies of the meeting
materials at their addresses and would like to request
“householding” of their communications should contact their
brokers.
13
Table of
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OTHER
BUSINESS
We know of no other business that will be presented at the Meeting.
If any other matter properly comes before the stockholders for a
vote at the Meeting, however, the proxy holders will vote your
shares in accordance with their best judgment. This discretionary
authority is granted by the execution of the form of proxy.
14
Table of
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ADDITIONAL
FILINGS
Our reports on Forms 10-K,
10-Q, 8-K
and all amendments to those reports are available without charge
through the Investors & Media section of the Company’s
website at www.gamida-cell.com. as soon
as reasonably practicable after they are electronically filed with,
or furnished to, the SEC.
You may request a copy of our SEC filings, including a copy of the
Annual Report on Form 10-K for
the fiscal year ended December 31, 2021, at no cost to you, by
writing to the Company address appearing in this Proxy Statement or
by e-mailing us at
legalnotices@gamida-cell.com.
15
Table of
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ANNEX
A — first lien secured note
FORM OF FIRST LIEN SECURED NOTE
THE SECURITIES REPRESENTED BY THIS NOTE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
FOREIGN OR STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A)
AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL,
IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID
ACT.
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT
(“OID”)
FOR U.S. FEDERAL INCOME TAX PURPOSES. THE ISSUE PRICE, AMOUNT OF
OID, ISSUE DATE AND YIELD TO MATURITY WITH RESPECT TO THIS NOTE MAY
BE OBTAINED BY WRITING TO THE COMPANY AT THE FOLLOWING ADDRESS: 116
HUNTINGTON AVE., 7TH
FLOOR, BOSTON, MASSACHUSETTS, 02116; ATTENTION: GENERAL COUNSEL;
EMAIL: LEGALNOTICES@GAMIDA-CELL.COM.
THIS NOTE EVIDENCES ALL OR PART OF THE TERM LOAN MADE PURSUANT TO
THE LOAN AGREEMENT. INTERESTS IN THIS NOTE MAY ONLY BE TRANSFERRED
IN CONNECTION WITH AN ASSIGNMENT OF SUCH TERM LOAN THAT IS PROPERLY
RECORDED IN THE REGISTER OR THE PARTICIPANT REGISTER.
FIRST LIEN SECURED NOTE
Note Number
|
|
2022 –
|
Issuance Date:
|
|
_______________________________
|
Original Principal Amount:
|
|
_______________________________
|
Interest:
|
|
7.5% per annum, subject to adjustment as set forth in the Loan
Agreement
|
Interest Payment Dates:
|
|
Quarterly in arrears, on each January 1, April 1, July 1, October
1, commencing April 1, 2023
|
Maturity Date:
|
|
December 12, 2024
|
FOR VALUE RECEIVED, Gamida Cell Inc., a Delaware corporation (the
“Borrower”),
hereby unconditionally promises to pay to Highbridge Tactical
Credit Master Fund, L.P. (the “Lender”)
the “Original Principal Amount” set forth above, or, if less, the
aggregate unpaid Principal amount of the Term Loan of the Lender to
the Borrower, the accrued interest thereon, and all other amounts
due and payable, in each case at such times and in such amounts as
specified in this Note or in the Loan Agreement.
This First Lien Secured Note (this “Note”)
is one of the secured notes (the “Notes”)
issued pursuant to that certain Loan and Security Agreement, dated
as of December 12, 2022 (as may be amended, restated, supplemented
or otherwise modified from time to time, the “Loan
Agreement”),
by and among the Borrower, Parent, the Lender and the other Lenders
party thereto, and Wilmington Savings Fund Society, FSB, as
Administrative Agent and Collateral Agent.
The Loan Agreement, among other things, (a) provides for the making
of Term Loans by the Lenders to the Borrower and the indebtedness
of the Borrower resulting from such Term Loans being evidenced by
the Notes and (b) contains provisions for acceleration of the
maturity of the unpaid Principal amount of this Note upon the
happening of certain stated events and also for prepayments
pursuant to the terms of the Loan Agreement on account of the
Principal hereof prior to the maturity hereof upon the terms and
conditions specified therein.
Annex A-1
Table of
Contents
Gamida Cell Ltd., a limited liability company organized under the
laws of the State of Israel (“Parent”),
has fully and unconditionally guaranteed the obligations of the
Borrower under the Loan Agreement and this Note, including the
obligations in connection with Exchanges and the obligations to
deliver Ordinary Shares in connection with any interest or
installment payment payable in Ordinary Shares.
1. Definitions.
(a) Terms
Defined in This Note.
The following terms are defined in the Sections referenced opposite
such terms:
|
|
“Beneficial Ownership
Limitation”
|
|
5(b)(iv)
|
|
|
|
|
“Borrower”
|
|
Recitals
|
|
|
|
|
“Buy-In”
|
|
7(d)
|
|
|
|
|
“Clause A
Distribution”
|
|
4(c)(iii)
|
|
|
|
|
“Clause B
Distribution”
|
|
4(c)(iii)
|
|
|
|
|
“Clause C
Distribution”
|
|
4(c)(iii)
|
|
|
|
|
“Distributed
Property”
|
|
4(c)(iii)
|
|
|
|
|
“DTC”
|
|
4(b)(ii)
|
|
|
|
|
“Exchange Cap”
|
|
5(a)
|
|
|
|
|
“Exchange Notice”
|
|
4(b)(i)
|
|
|
|
|
“Forced Exchange”
|
|
4(h)(i)
|
|
|
|
|
“Forced Exchange
Notice”
|
|
4(h)(ii)
|
|
|
|
|
“Forced Exchange Lender
Notice”
|
|
4(h)(iii)
|
|
|
|
|
“Forced Exchange Maximum Share
Amount”
|
|
4(h)(iii)
|
|
|
|
|
“Interest
Make-Whole Payment”
|
|
3(b)
|
|
|
|
|
“Loan Agreement”
|
|
Recitals
|
|
|
|
|
“Lender”
|
|
Recitals
|
|
|
|
|
“Merger Event”
|
|
4(e)
|
|
|
|
|
“Note”
|
|
Recitals
|
|
|
|
|
“Notes”
|
|
Recitals
|
|
|
|
|
“OID”
|
|
Legend
|
|
|
|
|
“Reference
Property”
|
|
4(e)
|
|
|
|
|
“Spin-Off”
|
|
4(c)(iii)
|
|
|
|
|
“Transfer Agent”
|
|
4(b)(ii)
|
|
|
|
|
“Trigger Event”
|
|
4(c)(iii)
|
|
|
|
|
“Valuation Period”
|
|
4(c)(iii)
|
|
|
|
|
“unit of Reference
Property”
|
|
4(e)
|
|
|
|
|
“Voluntary
Exchange”
|
|
4(a)
|
|
|
(b) Certain
Additional Defined Terms.
In addition to the terms defined elsewhere in this Note,
(x)
capitalized
terms used herein without definition are used as defined in the
Loan Agreement and (y) the following terms shall have the following
meanings:
(i) “Board
of Directors”
means, with respect to any Person, the board of directors of such
Person or a committee of such board duly authorized to act for such
board.
(ii) “Business
Day”
means any day other than a Saturday, a Sunday or a day on which
commercial banks in New York, New York or Wilmington, Delaware are
required or authorized to be closed.
(iii) “Capital
Stock”
means, for any entity, any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of
or interests in (however designated) stock issued by that entity,
but shall not include any debt securities convertible into or
exchangeable for any securities otherwise constituting Capital
Stock pursuant to this definition.
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(iv) “close
of business”
means 5:00 p.m. (New York City time).
(v) “Common
Equity”
of any Person means Capital Stock of such Person that is generally
entitled (A) to vote in the election of directors of such Person or
(B) if such Person is not a corporation, to vote or otherwise
participate in the selection of the governing body, partners,
managers or others that will control the management or policies of
such Person.
(vi) “Daily
VWAP”
means, for each Trading Day, the per share volume-weighted average
price of the Ordinary Shares as displayed under the heading
“Bloomberg VWAP” on Bloomberg page “GMDA <equity> AQR” (or
its equivalent successor if such page is not available) in respect
of the period from the scheduled open of trading until the
scheduled close of trading of the primary trading session on such
Trading Day up to and including the final closing print (which is
indicated by “Condition Code 6” in Bloomberg) (or if such
volume-weighted average price is unavailable at such time, the
market value of one Ordinary Share on such Trading Day determined,
using a volume-weighted average method, by a nationally recognized
independent investment banking firm retained for this purpose by
the Borrower). The Daily VWAP shall be determined without regard to
after-hours trading or any other trading outside of the regular
trading session trading hours. Notwithstanding the foregoing, on or
after the occurrence of a Merger Event, the Daily VWAP of a unit of
Reference Property on any date shall be determined in accordance
with the two immediately preceding sentences except that (A) such
unit, or portion thereof, that consists of class of Common Equity
will be determined by substituting such class of Common Equity for
references to Ordinary Shares above (B) such unit, or portion
thereof, that consists of cash shall be equal to the per share
amount of cash received by holders of Ordinary Shares in such
Merger Event and (C) such unit, or portion thereof, that consists
of a type of consideration other than cash or a class of Common
Equity shall be the fair market value of such unit of Reference
Property determined by a nationally recognized independent
investment banking firm retained for this purpose by the
Borrower.
(vii) “Effective
Date”
means the first date on which the Ordinary Shares trade on the
applicable exchange or in the applicable market, regular way,
reflecting the relevant share split or share combination, as
applicable.
(viii) “Equity
Payment Conditions”
means, as of any determination date and with respect to any
Installment Payment, payment of interest, Interest Make-Whole
Payment, Exchange or Prepayment, (A) no Registration Default (as
defined in the Registration Rights Agreement) is ongoing, (B) a
shelf registration statement registering the resale of all Ordinary
Shares issuable pursuant to such Installment Payment, interest
payment, Interest Make-Whole Payment or Exchange, as applicable,
has been filed and has been declared and remains effective under
the Securities Act and a prospectus under such shelf registration
statement covering the resale of all such Ordinary Shares remains
current and available for use by the Persons to whom such Ordinary
Shares are to be issued, and the Borrower expects such shelf
registration statement and such prospectus to remain effective,
current and available for use at all times during the period from,
and including, the first Trading Day in the calculation of the
applicable Floating Share Price with respect to such Installment
Payment, payment of interest, Interest Make-Whole Payment, Exchange
or Prepayment or the date notice of such Prepayment is given to the
Lenders, as applicable, through, and including, the date that is
thirty (30) calendar days following such issuance or Prepayment, as
applicable, (C) no Default or Event of Default has occurred and is
continuing under the Loan Agreement, (D) the Ordinary Shares are
listed or quoted on a Principal Market, (E) all Ordinary Shares
issuable pursuant to such Installment Payment, payment of interest,
Interest Make-Whole Payment or Exchange, as applicable, will be
issued without exceeding the limitations set forth in
Section 5
(assuming for such purposes that (1) the Lender and its affiliates
do not beneficially own any Excluded Ordinary Shares and (2) for
purposes of calculating compliance with the Exchange Cap, the
Borrower and Parent have previously issued an aggregate number of
Ordinary Shares sufficient to Exchange all outstanding Notes in
Voluntary Exchanges (without giving effect the Beneficial Ownership
Limitation)), (F) all Ordinary Shares will, when issued, be duly
authorized, validly issued, fully paid and non-assessable shares,
(G) all such Ordinary Shares are able to be settled through DTC as
contemplated by this Note and the Transfer Agent is participating
in DTC’s Fast Automated Securities Transfer Program, (H) at the
time the Borrower made any election to make any such Installment
Payment, payment of interest, Interest Make-Whole Payment, Exchange
or Prepayment, neither the Borrower nor Parent was in possession of
any material non-public information with regard to the Borrower,
Parent or the Ordinary Shares, and (I) solely with regard to any
Installment Payment or interest payment, no Triggering Event shall
have occurred and be continuing as of such date.
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(ix) “Ex-Dividend
Date”
means the first date on which the Ordinary Shares trade on the
applicable exchange or in the applicable market, regular way,
without the right to receive the issuance, dividend or distribution
in question, from Parent or, if applicable, from the seller of
Ordinary Shares on such exchange or market (in the form of due
bills or otherwise) as determined by such exchange or
market.
(x) “Exchange”
means any Voluntary Exchange or Forced Exchange, as
applicable.
(xi) “Exchange
Act”
means the Securities Exchange Act of 1934, as amended.
(xii) “Exchange
Amount”
means the Principal amount to be exchanged in any
Exchange.
(xiii) “Exchange
Date”
means, (A) in the case of any Voluntary Exchange, the date of the
Lender’s delivery via facsimile or electronic mail of an Exchange
Notice, and (B) in the case of any Forced Exchange, the date of the
Lender’s delivery via facsimile or electronic mail of a Forced
Exchange Lender Notice and confirmation of receipt of a Forced
Exchange Notice.
(xiv) “Exchange
Price”
means, as of any time, $1.00
divided by
the Exchange Rate as of such time.
(xv) “Exchange
Rate”
means 0.52356 Ordinary Shares per $1.00 Principal amount, subject
to adjustment as set forth in this Note.
(xvi) “Excluded
Ordinary Shares”
means any Ordinary Shares purchased by the Lender or any of its
affiliates in an open market transaction or acquired upon exercise
or settlement of over-the-counter options or derivatives. To avoid
doubt, any Ordinary Shares that are or may be acquired upon the
exercise, conversion or exchange of, or pursuant to the terms of,
any other securities (including, without limitation, the Notes or
the Existing Notes) issued by the Parent or any of its affiliates
shall not be considered Excluded Ordinary Shares.
(xvii) “Fair
Market Value”
means the value that would be paid by a willing buyer to an
unaffiliated willing seller in an arm’s length transaction not
involving distress or necessity of either party, determined in good
faith by (unless otherwise provided in this Note or the Loan
Agreement) Parent, taking into account all relevant factors
determinative of value, including, without limitation, preference
rights, lack of liquidity, control and restrictions on
marketability and transferability.
(xviii)“Floating
Share Price”
means, as of any date, (i) with regard to an Interest Make-Whole
Payment made in Ordinary Shares in connection with a Forced
Exchange, an amount equal to 95% of the arithmetic mean of the
Daily VWAP for each of the ten Trading Days beginning on, and
including, the Trading Day immediately after the Exchange Date for
such Forced Exchange and (ii) in all other cases, an amount equal
to 95% of the arithmetic mean of the Daily VWAP for each of the ten
Trading Days ending on, and including, the Trading Day immediately
preceding such date.
(xix) “Floor
Price”
means $1.00;
provided
that (A) the Floor Price then in effect shall be automatically and
equitably adjusted to account for any events adjusting the Exchange
Price under the terms of the Loan Agreement or this Note and (B)
upon any Triggering Event, the Borrower may, no more than three
times prior to the Maturity Date and upon at least fifteen (15)
Trading Days prior written notice to the Lenders, elect to reset
the Floor Price to be 40% of the arithmetic mean of the Daily VWAP
for each of the five Trading Days beginning on, and including, the
date of such Triggering Event.
(xx) “Last
Reported Sale Price”
of the Ordinary Shares on any date means the closing sale price per
share (or if no closing sale price is reported, the average of the
bid and ask prices or, if more than one in either case, the average
of the average bid and the average ask prices) on that date as
reported in composite transactions for the principal U.S. national
or regional securities exchange on which the Ordinary Shares are
traded. If the Ordinary Shares are not listed for trading on a U.S.
national or regional securities exchange on the relevant date, the
Last Reported Sale Price shall be the last quoted bid price for the
Ordinary Shares in the over-the-counter market on the relevant date
as reported by OTC Markets Group Inc. or a similar organization. If
the Ordinary Shares are not so quoted, the Last Reported Sale Price
shall be the average of the mid-point of the last bid and ask
prices for the Ordinary Shares on the relevant date from each of at
least three nationally recognized independent investment banking
firms selected
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by Parent for this purpose. Any such determination will be
conclusive absent manifest error. The Last Reported Sale Price will
be determined without reference to extended or after-hours trading.
Notwithstanding the foregoing, on or after the occurrence of a
Merger Event, the Last Reported Sale Price of a unit of Reference
Property on any date shall be determined in accordance with the
four immediately preceding sentences except that (A) such unit, or
portion thereof, that consists of class of Common Equity will be
determined by substituting such class of Common Equity for
references to Ordinary Shares above (B) such unit, or portion
thereof, that consists of cash shall be equal to the per share
amount of cash received by holders of Ordinary Shares in such
Merger Event and (C) such unit, or portion thereof, that consists
of a type of consideration other than cash or a class of Common
Equity shall be the fair market value of such unit of Reference
Property determined by a nationally recognized independent
investment banking firm retained for this purpose by the
Borrower.
(xxi) “Ordinary
Shares”
means the Parent’s ordinary shares with a nominal value of New
Israeli Shekel (NIS) 0.01 per share, at the date of the Loan
Agreement, subject to adjustment as set forth in this Note and in
the Loan Agreement. Following a Merger Event where the Reference
Property includes Common Equity, references to Ordinary Shares in
the Loan Agreement (except for
Section 2.2(f)
(other than with reference to the Interest Make-Whole Payment)
and
Sections 5.14
and
5.15
of the Loan Agreement),
Sections 2
and
3
of this Note, as well as in
Sections 5,
6
and
7
as they apply to
Sections 2
and
3
of this Note and any definitions used in this Note or the Loan
Agreement regarding any of the foregoing sections, will be deemed
to be references to such Common Equity.
(xxii) “Parent”
has the meaning set forth in the Recitals and includes its
successors and assigns.
(xxiii)“Prepayment”
means any prepayment of the Term Loans pursuant to Section 2.2(c)
or Section 2.2(d) of the Loan Agreement.
(xxiv)“Principal”
means the outstanding principal amount of this Note as of any date
of determination.
(xxv) “Principal
Market”
means The New York Stock Exchange, The NASDAQ Global Select Market
or The NASDAQ Global Market (or any of their respective
successors).
(xxvi)“Record
Date”
means, with respect to any dividend, distribution or other
transaction or event in which the holders of Ordinary Shares (or
other applicable security) have the right to receive any cash,
securities or other property or in which the Ordinary Shares (or
such other security) are exchanged for or converted into any
combination of cash, securities or other property, the date fixed
for determination of holders of Ordinary Shares (or such other
security) entitled to receive such cash, securities or other
property (whether such date is fixed by the Board of Directors, by
statute, by contract or otherwise).
(xxvii)“Shareholder
Approval”
means (i) the receipt by Parent of requisite approval from its
shareholders to issue more than 19.99% of its outstanding Ordinary
Shares at an issue price below the “minimum price” pursuant to the
terms of the Loan Agreement and this Note in accordance with Nasdaq
Stock Market Rule 5635; (ii) the receipt by Parent of the requisite
approval from its shareholders to enter into a transaction the
purpose of which is the private placement of promissory notes
convertible to and/or exchangeable for shares representing 25% or
45%, as the case may be, or more of the voting power at the general
assembly of Parent’s shareholders, in accordance with Section
328(b)(1) of the Israeli Companies Law; and (iii) the receipt by
Parent of the requisite approval from its shareholders, in
accordance with Sections 270(5) and 274 of the Israeli Companies
Law.
(xxviii)“Subsidiary”
means, with respect to any Person, any corporation, association,
partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests
(including partnership interests) entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers, general partners or trustees thereof is at the
time owned or controlled, directly or indirectly, by (A) such
Person; (B) such Person and one or more Subsidiaries of such
Person; or (C) one or more Subsidiaries of such Person. Unless the
context otherwise requires, “Subsidiary” refers to a Subsidiary of
Parent.
(xxix)“Trading
Day”
means a day on which (A) trading in the Ordinary Shares (or other
security for which a closing sale price must be determined)
generally occurs on The Nasdaq Global Select Market or, if the
Ordinary Shares (or such other security) are not then listed on The
Nasdaq Global Select Market, on the principal other U.S. national
or regional securities exchange on which the Ordinary Shares (or
such other security) are then
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listed or, if the Ordinary Shares (or such other security) are not
then listed on a U.S. national or regional securities exchange, on
the principal other market on which the Ordinary Shares (or such
other security) are then traded and (A) a Last Reported Sale Price
for the Ordinary Shares (or closing sale price for such other
security) is available on such securities exchange or
market;
provided
that if the Ordinary Shares (or such other security) are not so
listed or traded, “Trading Day” means a Business Day.
(xxx) “Triggering
Event”
means, as of any date, (A) the Last Reported Sale Price of the
Ordinary Shares is below the Floor Price for three or more of the
five consecutive Trading Days ending on, and including, the Trading
Day immediately preceding such date, or (B) no additional Ordinary
Shares can be issued pursuant to the terms of the Loan Agreement
and this Note without violation of
Section 5;
provided
that once a Triggering Event with regard to clause (A) above has
occurred, such Triggering Event shall be continuing until either
(x) the Floor Price is reset pursuant to the definition thereof or
(y) the Daily VWAP of the Ordinary Shares exceeds the Floor Price
for at least five consecutive Trading Days.
2. Installment
Payments.
The Borrower shall make Installment Payments on this Note at the
times and in the manner specified in the Loan Agreement. Subject to
the terms of the Loan Agreement, the Borrower shall have the option
to pay each Installment Payment in cash or, subject to the
satisfaction of the Equity Payment Conditions as of the date of
such Installment Payment, by delivering Ordinary Shares, with the
value of each Ordinary Share equal to the Floating Share Price as
of the date of such Installment Payment. All Installment Payments
will be made in cash unless the Borrower delivers prior written
notice to the Lender and Administrative Agent stating that the
Borrower will, subject to the satisfaction of the Equity Payment
Conditions as of the date of each Installment Payment, pay all or a
portion of any future Installment Payments in Ordinary Shares and
specifying the time periods during which such election shall apply.
Such notice, or any subsequent notice changing such election, shall
not be effective until the end of the 15th
Trading Day after such notice or such subsequent notice has been
delivered to the Lender and the Administrative Agent. All Ordinary
Shares issuable in satisfaction of an Installment Payment shall be
delivered on or before the second (2nd)
Business Day (or, if earlier, the end of the standard settlement
period for U.S. broker-dealer securities transactions) following
the last Trading Day included in the calculation of the relevant
Floating Share Price by crediting such aggregate number of Ordinary
Shares to which the Lender shall be entitled to the Lender’s or its
designee’s balance account with DTC through its Deposit/Withdrawal
At Custodian (DWAC) system. Notwithstanding anything in this Note
or the Loan Agreement to the contrary, the issuance and delivery of
Ordinary Share pursuant to this
Section 2
will be subject in all cases to the provisions set forth in
Section 5
and
Section 7.
In the event that the Borrower elects to pay Installment Payments
with Ordinary Shares, upon delivery of such Ordinary Shares to the
Lender, the Borrower will provide the Administrative Agent with (y)
written confirmation of (I) such delivery, and (II) the amount of
Installment Payment that is deemed paid as a result of the delivery
of the Ordinary Shares to the Lender and, to the extent the
Installment Payment is not paid in full with Ordinary Shares, the
amounts deemed paid for each component of the Installment Payment,
and (z) an irrevocable instruction to reflect in the Register the
payment of the amount of Installment Payment that is deemed paid as
a result of the delivery of the Ordinary Shares to the Lender. If
the Borrower has made an election to pay Installment Payments with
Ordinary Shares in the manner provided herein, and the Borrower
determines the Equity Payment Conditions have not or are not
expected to be satisfied in connection with such Installment
Payments, the Borrower shall promptly notify the Administrative
Agent that such Installment Payments shall be made in cash (and not
in Ordinary Shares) and, no later than 2:00 pm Eastern Time on the
applicable Payment Date, provide the applicable amounts in cash to
make such Installment Payments (in addition to any other amounts to
be paid in cash in connection therewith); provided, however, the
Administrative Agent shall only be required to use commercially
reasonable efforts to distribute such funds to the applicable
Secured Parties on such date of payment and in no event shall the
Administrative Agent be liable if such funds are not so distributed
on such date of payment.
3. Interest
Payments.
(a) Ordinary
Interest Payments.
The Borrower shall make interest payments on the Principal amount
represented by this Note at the times and in the manner specified
in the Loan Agreement and this Note. Subject to the terms of the
Loan Agreement, the Borrower shall have the option to pay each
interest payment in cash or, subject to the satisfaction of the
Equity Payment Conditions as of the date of such interest payment,
by delivering Ordinary Shares, with the value of each Ordinary
Share equal to the Floating Share Price as of the date of such
interest payment. All interest payments will be made in cash unless
the Borrower delivers prior written notice to the Lender and
the
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Administrative Agent stating that the Borrower will, subject to the
satisfaction of the Equity Payment Conditions as of the date of
each interest payment, pay all or a portion of any future interest
payments in Ordinary Shares and specifying the time periods during
which such election shall apply. Such notice, or any subsequent
notice changing such election, shall not be effective until the end
of the 15th
Trading Day after such notice or such subsequent notice has been
delivered to the Lender. In the event that the Borrower elects to
pay accrued and unpaid interest with Ordinary Shares, upon delivery
of such Ordinary Shares to the Lender, the Borrower will provide
the Administrative Agent with (y) written confirmation of (I) such
delivery, and (II) the amount of interest that is deemed paid as a
result of the delivery of the Ordinary Shares to the Lender, and
(z) an irrevocable instruction to reflect on its books and records
the payment of the amount of interest that is deemed paid as a
result of the delivery of the Ordinary Shares to the Lender. If the
Borrower has made an election to pay accrued and unpaid interest
with Ordinary Shares in the manner provided herein, and the
Borrower determines the Equity Payment Conditions have not or are
not expected to be satisfied in connection with such accrued and
unpaid interest, the Borrower shall promptly notify the
Administrative Agent that such accrued and unpaid interest shall be
made in cash (and not in Ordinary Shares) and, no later than 2:00
pm Eastern Time on the applicable Payment Date, provide the
applicable amounts in cash to make such accrued and unpaid interest
(in addition to any other amounts to be paid in cash in connection
therewith); provided, however, the Administrative Agent shall only
be required to use commercially reasonable efforts to distribute
such funds to the applicable Secured Parties on such date of
payment and in no event shall the Administrative Agent be liable if
such funds are not so distributed on such date of
payment.
(b) Interest
Make-Whole Payments.
In connection and simultaneous with any Exchange or Prepayment, the
Borrower shall, in addition to the other consideration payable or
deliverable in connection with such Exchange or Prepayment, make an
interest make-whole payment to the Lender with respect to the
Principal amount being exchanged in such Exchange or prepaid in
such Prepayment equal to the aggregate amount of interest which,
but for such Exchange or Prepayment, would have otherwise been
payable on such Principal amount from (and including) the last date
on which interest was paid with respect to such Principal amount
through (and including) the Maturity Date (the “Interest
Make-Whole Payment”).
Subject to the terms of the Loan Agreement, the Borrower shall have
the option to pay any Interest Make-Whole Payment in cash or,
subject to the satisfaction of the Equity Payment Conditions as of
the date of such payment, by delivering Ordinary Shares, with the
value of each Ordinary Share equal to the Floating Share Price as
of the date of such payment. All Interest Make-Whole Payments will
be made in cash unless the Borrower delivers prior written notice
to the Lender and the Administrative Agent stating that the
Borrower will, subject to the satisfaction of the Equity Payment
Conditions as of the date of each payment, pay all or a portion of
any future Interest Make-Whole Payments in Ordinary Shares and
specifying the time periods during which such election shall apply.
Such notice, or any subsequent notice changing such election, shall
not be effective until the end of the 15th
Trading Day after such notice or such subsequent notice has been
delivered to the Lender. In the event that the Borrower elects to
pay Interest Make-Whole Payments with Ordinary Shares, upon
delivery of such Ordinary Shares to the Lender, the Borrower will
provide the Administrative Agent with (y) written confirmation of
(I) such delivery, and (II) the amount of Interest Make-Whole
Payments that is deemed paid as a result of the delivery of the
Ordinary Shares to the Lender, and (z) an irrevocable instruction
to reflect on its books and records the payment of the amount of
Interest Make-Whole Payments that is deemed paid as a result of the
delivery of the Ordinary Shares to the Lender. If the Borrower has
made an election to pay Interest Make-Whole Payments with Ordinary
Shares in the manner provided herein, and the Borrower determines
the Equity Payment Conditions have not or are not expected to be
satisfied in connection with such Interest Make-Whole Payments, the
Borrower shall promptly notify the Administrative Agent that such
Interest Make-Whole Payments shall be made in cash (and not in
Ordinary Shares) and, no later than 2:00 pm Eastern Time on the
applicable prepayment date, provide the applicable amounts in cash
to make such Interest Make-Whole Payments (in addition to any other
amounts to be paid in cash in connection therewith); provided,
however, the Administrative Agent shall only be required to use
commercially reasonable efforts to distribute such funds to the
applicable Secured Parties on such date of payment and in no event
shall the Administrative Agent be liable if such funds are not so
distributed on such date of payment.
(c) Settlement
Mechanics.
All Ordinary Shares issuable in satisfaction of any interest
payment or Interest Make-Whole Payment shall be delivered on or
before the second (2nd)
Business Day (or, if earlier, the end of the standard settlement
period for U.S. broker-dealer securities transactions) following
the last Trading Day included in the calculation of the relevant
Floating Share Price by crediting such aggregate number of Ordinary
Shares to which the Lender shall be entitled to the Lender’s or its
designee’s balance account with DTC through its
Deposit/Withdrawal
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At Custodian (DWAC) system. Notwithstanding anything in this Note
or the Loan Agreement to the contrary, the issuance and delivery of
Ordinary Share pursuant to this
Section 3
will be subject in all cases to the provisions set forth in
Section 5
and
Section 7.
4. Exchange
Rights.
This Note may be exchanged into Ordinary Shares on the terms and
conditions set forth in this
Section 4
and subject in all cases to the limitations set forth in
Section 5.
(a) Exchange
at Option of the Lender.
Subject to the terms and conditions set forth in this
Section 4
and
Section 5,
at any time during the period commencing on the Funding Date and
ending on the close of business on the second Business Day
immediately prior to the Maturity Date, the Lender shall be
entitled to convert all or any part of the Principal amount of this
Note into Ordinary Shares in accordance with this
Section 4
at the Exchange Rate per $1.00 Principal amount exchanged (any such
exchange at the election of the Lender being referred to as a
“Voluntary
Exchange”).
(b) Mechanics
of Exchange.
Subject to the provisions of this
Section 4,
the Exchange of any portion of this Note shall be conducted in the
following manner:
(i) Lender’s
Delivery Requirements.
To exchange an Exchange Amount into Ordinary Shares pursuant
to
Section 4(a)
on any date, the Lender shall (A) transmit by facsimile or
electronic mail (or otherwise deliver), for receipt on or prior to
5:00 p.m. New York City time on such date, a copy of an executed
exchange notice in the form attached hereto as
Exhibit A
(the “Exchange
Notice”)
to Borrower at 116 Huntington Ave., 7th
Floor, Boston, Massachusetts, 02116, Attention: General Counsel;
Email: legalnotices@gamida-cell.com, or at such other office or
agency as the Borrower may designate in writing, and to the
Administrative Agent at the address provided pursuant to Section 10
of the Loan Agreement and (B) if required by
Section 7(c),
surrender to a common carrier for delivery to the Borrower, no
later than three (3) Business Days after the Exchange Date, of the
original Note being converted (or an indemnification undertaking in
customary form with respect to this Note in the case of its loss,
theft or destruction).
(ii) Borrower’s
Response.
Upon receipt by the Borrower of a copy of an Exchange Notice, or in
the case of a Forced Exchange, receipt by the Borrower of the
Forced Exchange Lender Notice, the Borrower (A) shall promptly
send, via electronic mail, a confirmation of receipt of such
Exchange Notice to the Lender and Parent’s designated transfer
agent (the “Transfer
Agent”),
which confirmation shall be accompanied by an instruction to the
Transfer Agent to process the Voluntary Exchange or Forced Exchange
in accordance with the terms herein, and (B) on or before the
second (2nd)
Business Day (or, if earlier, the end of the standard settlement
period for U.S. broker-dealer securities transactions) following
(I) the date of receipt or deemed receipt by the Borrower of the
Exchange Notice or (II) the date of receipt by the Borrower of the
Forced Exchange Lender Notice, shall credit such aggregate number
of Ordinary Shares to which the Lender shall be entitled (including
any Ordinary Shares payable with respect to any applicable Interest
Make-Whole Payment) to the Lender’s or its designee’s balance
account with The Depository Trust Company (“DTC”)
through its Deposit/Withdrawal At Custodian (DWAC)
system.
(iii) Additional
Settlement Mechanics.
The provisions of
Section 7
will apply to any Exchange pursuant to this Note. Each Voluntary
Exchange shall be deemed to have occurred immediately prior to the
close of business on the applicable Exchange Date.
(c) Adjustments
to the Exchange Rate.
The Exchange Rate shall be automatically adjusted from time to time
if any of the following events occurs, except that no adjustments
to the Exchange Rate shall be made if the Lender participates
(other than in the case of (x) a share split or share combination
or (y) a tender or exchange offer), at the same time and upon the
same terms as holders of Ordinary Shares and solely as a result of
holding this Note, in any of the transactions described in
this
Section 4(c),
without having to exchange any portion of this Note, as if the
Lender held a number of Ordinary Shares equal to the Exchange Rate
multiplied by the Principal amount of this Note then held by the
Lender.
Annex A-8
Table of
Contents
(i) If
Parent exclusively issues Ordinary Shares as a dividend or
distribution on Ordinary Shares, or if Parent effects a share split
or share combination, the Exchange Rate shall be adjusted according
to the following formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the close of
business on the Record Date for such dividend or distribution, or
immediately prior to the open of business on the Effective Date of
such share split or share combination, as applicable;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the close of business
on such Record Date or immediately after the open of business on
such Effective Date, as applicable;
|
|
|
OS0
|
|
=
|
|
the number of Ordinary Shares outstanding immediately prior to the
close of business on such Record Date or immediately prior to the
open of business on such Effective Date, as applicable (before
giving effect to any such dividend, distribution, split or
combination); and
|
|
|
OS’
|
|
=
|
|
the number of Ordinary Shares outstanding immediately after giving
effect to such dividend, distribution, share split or share
combination.
|
Any adjustment made under this
Section 4(c)(i)
shall become effective immediately after the close of business on
the Record Date for such dividend or distribution, or immediately
after the open of business on the Effective Date for such share
split or share combination, as applicable. If any dividend or
distribution of the type described in this
Section 4(c)(i)
is declared but not so paid or made, the Exchange Rate shall be
immediately readjusted, effective as of the date Parent determines
not to pay such dividend or distribution, to the Exchange Rate that
would then be in effect if such dividend or distribution had not
been declared.
(ii) If
Parent issues to all or substantially all holders of Ordinary
Shares any rights, options or warrants (other than pursuant to a
shareholder rights plan) entitling them, for a period of not more
than 60 calendar days after the announcement date of such issuance,
to subscribe for or purchase Ordinary Shares at a price per share
that is less than the average of the Last Reported Sale Prices of
the Ordinary Shares over the 10 consecutive Trading Day period
ending on, and including, the Trading Day immediately preceding the
date of announcement of such issuance, the Exchange Rate shall be
increased based on the following formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the close of
business on the Record Date for such issuance;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the close of business
on such Record Date;
|
|
|
OS0
|
|
=
|
|
the number of Ordinary Shares outstanding immediately prior to the
close of business on such Record Date;
|
|
|
X
|
|
=
|
|
the total number of Ordinary Shares issuable pursuant to such
rights, options or warrants; and
|
|
|
Y
|
|
=
|
|
the number of Ordinary Shares equal to the aggregate price payable
to exercise such rights, options or warrants, divided by the
average of the Last Reported Sale Prices of the Ordinary Shares
over the 10 consecutive Trading Day period ending on, and
including, the Trading Day immediately preceding the date of
announcement of the issuance of such rights, options or
warrants.
|
Annex A-9
Table of
Contents
Any increase made under this
Section 4(c)(ii)
shall be made successively whenever any such rights, options or
warrants are issued and shall become effective immediately after
the close of business on the Record Date for such issuance. To the
extent that such rights, options or warrants are not exercised
prior to their expiration or Ordinary Shares are not delivered
after the expiration of such rights, options or warrants, the
Exchange Rate shall be decreased to the Exchange Rate that would
then be in effect had the increase with respect to the issuance of
such rights, options or warrants been made on the basis of delivery
of only the number of Ordinary Shares actually delivered. If such
rights, options or warrants are not so issued or if such rights,
options or warrants are not exercised prior to their expiration,
the Exchange Rate shall be decreased to the Exchange Rate that
would then be in effect if such Record Date for such issuance had
not occurred.
For purposes of this
Section 4(c)(ii),
in determining whether any rights, options or warrants entitle the
holders to subscribe for or purchase Ordinary Shares at less than
such average of the Last Reported Sale Prices of the Ordinary
Shares over the 10 consecutive Trading Day period ending on, and
including, the Trading Day immediately preceding the date of
announcement for such issuance, and in determining the aggregate
offering price of such Ordinary Shares, there shall be taken into
account any consideration received by Parent for such rights,
options or warrants and any amount payable on exercise or exchange
thereof, the value of such consideration, if other than cash, to be
determined by Parent’s Board of Directors in good faith and in a
commercially reasonable manner.
(iii) If
Parent distributes shares of its Capital Stock, evidences of its
indebtedness, other assets or property of Parent or rights, options
or warrants to acquire its Capital Stock or other securities, to
all or substantially all holders of Ordinary Shares (any of such
shares of Capital Stock, evidences of indebtedness, other assets or
property or rights, options or warrants to acquire Capital Stock or
other securities, the “Distributed
Property”),
excluding (A) dividends, distributions or issuances as to which an
adjustment was effected pursuant to
Section 4(c)(i)
or
Section 4(c)(ii)
(or will be so effected in accordance with the second sentence
of
Section 4(c)(ix)),
(ii) except as set forth in
Section 4(g),
rights issued under a shareholder rights plan, (iii) dividends or
distributions paid exclusively in cash as to which the provisions
set forth in
Section 4(c)(iv)
shall apply, and (iv) Spin-Offs as to which the provisions set
forth below in this
Section 4(c)(iii)
shall apply, then the Exchange Rate shall be increased based on the
following formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the close of
business on the Record Date for such distribution;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the close of business
on such Record Date;
|
|
|
SP0
|
|
=
|
|
the average of the Last Reported Sale Prices of the Ordinary Shares
over the 10 consecutive Trading Day period ending on, and
including, the Trading Day immediately preceding the Record Date
for such distribution; and
|
|
|
FMV
|
|
=
|
|
the Fair Market Value (as determined by Parent’s Board of Directors
in good faith and in a commercially reasonable manner) of the
Distributed Property distributed with respect to each outstanding
Ordinary Share on the Record Date for such distribution.
|
Any increase made under the portion of this
Section 4(c)(iii)
above shall become effective immediately after the close of
business on the Record Date for such distribution. If such
distribution is not so paid or made, the Exchange Rate shall be
decreased to the Exchange Rate that would then be in effect if such
distribution had not been declared. Notwithstanding the foregoing,
if “FMV” (as defined above) is equal to or greater than
“SP0”
(as defined above), in lieu of the foregoing increase, the Lender
shall receive, in respect of each $1.00 Principal amount of this
Note, at the same time and upon the same terms as holders of
Ordinary Shares receive the Distributed Property, the amount and
kind of Distributed Property the Lender would have received if the
Lender owned a number of Ordinary Shares equal to the Exchange Rate
in effect on the Record Date for the distribution. If Parent’s
Board of Directors determines the “FMV” (as defined above) of any
distribution for purposes of this
Section 4(c)(iii)
by reference to the actual or when-issued trading market for any
securities, it shall in doing so consider the prices in such market
over the same period used in computing the Last Reported Sale
Prices of the Ordinary Shares over the 10 consecutive Trading Day
period ending on, and including, the Trading Day immediately
preceding the Ex-Dividend Date for such distribution.
Annex A-10
Table of
Contents
With respect to an adjustment pursuant to this
Section 4(c)(iii)
where there has been a payment of a dividend or other distribution
on the Ordinary Shares of shares of Capital Stock of any class or
series, or similar equity interest, of or relating to a Subsidiary
or other business unit of Parent, that are, or, when issued, will
be, listed or admitted for trading on a U.S. national securities
exchange (a “Spin-Off”),
the Exchange Rate shall be increased based on the following
formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the end of the
Valuation Period;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the end of the
Valuation Period;
|
|
|
FMV0
|
|
=
|
|
the average of the Last Reported Sale Prices of the Capital Stock
or similar equity interest distributed to holders of Ordinary
Shares applicable to one Ordinary Share (determined by reference to
the definition of Last Reported Sale Price as if references therein
to Ordinary Shares were to such Capital Stock or similar equity
interest) over the first 10 consecutive Trading Day period after,
and including, the Ex-Dividend Date of
the Spin-Off (the “Valuation Period”);
and
|
|
|
MP0
|
|
=
|
|
the average of the Last Reported Sale Prices of the Ordinary Shares
over the Valuation Period.
|
The increase to the Exchange Rate under the preceding paragraph
shall occur at the close of business on the last Trading Day of the
Valuation Period;
provided
that in respect of any Voluntary Exchange or Forced Exchange, if
the relevant Exchange Date occurs during the Valuation Period,
references to “10” in the preceding paragraph shall be deemed to be
replaced with such lesser number of Trading Days as have elapsed
from, and including, the Ex-Dividend Date of such Spin-Off to, and
including, the Exchange Date in determining the Exchange Rate. If
any dividend or distribution that constitutes a Spin-Off is
declared but not paid or made, the Exchange Rate shall be
immediately decreased, effective as of the date Parent determines
not to pay or make such dividend or distribution, to the Exchange
Rate that would then be in effect if such dividend or distribution
had not been declared or announced.
For purposes of this
Section 4(c)(iii)
(and subject in all respects to
Section 4(g)),
rights, options or warrants distributed by Parent to all holders of
Ordinary Shares entitling them to subscribe for or purchase shares
of Parent’s Capital Stock, including Ordinary Shares (either
initially or under certain circumstances), which rights, options or
warrants, until the occurrence of a specified event or events
(“Trigger
Event”):
(i) are deemed to be transferred with such Ordinary Shares; (ii)
are not exercisable; and (iii) are also issued in respect of future
issuances of Ordinary Shares, shall be deemed not to have been
distributed for purposes of this
Section 4(c)(iii)
(and no adjustment to the Exchange Rate under this
Section 4(c)(iii)
will be required) until the occurrence of the earliest Trigger
Event, whereupon such rights, options or warrants shall be deemed
to have been distributed and an appropriate adjustment (if any is
required) to the Exchange Rate shall be made under this
Section 4(c)(iii).
If any such right, option or warrant, including any such existing
rights, options or warrants distributed prior to the date of this
Note, are subject to events, upon the occurrence of which such
rights, options or warrants become exercisable to purchase
different securities, evidences of indebtedness or other assets,
then the date of the occurrence of any and each such event shall be
deemed to be the date of distribution and Record Date with respect
to new rights, options or warrants with such rights (in which case
the existing rights, options or warrants shall be deemed to
terminate and expire on such date without exercise by any of the
holders thereof). In addition, in the event of any distribution (or
deemed distribution) of rights, options or warrants, or any Trigger
Event or other event (of the type described in the immediately
preceding sentence) with respect thereto that was counted for
purposes of calculating a distribution amount for which an
adjustment to the Exchange Rate under this
Section 4(c)(iii)
was made, (1) in the case of any such rights, options or warrants
that shall all have been redeemed or purchased without exercise by
any holders thereof, upon such final redemption or purchase (x) the
Exchange Rate shall be readjusted as if such rights, options or
warrants had not been issued and (y) the Exchange Rate shall then
again be readjusted to give effect to such distribution, deemed
distribution or Trigger Event, as the case may be, as though it
were a cash distribution, equal to the per share redemption or
purchase price received by a holder or holders of Ordinary Shares
with respect to such rights, options or warrants (assuming such
holder had retained such rights,
Annex A-11
Table of
Contents
options or warrants), made to all holders of Ordinary Shares as of
the date of such redemption or purchase and (2) in the case of such
rights, options or warrants that shall have expired or been
terminated without exercise by any holders thereof, the Exchange
Rate shall be readjusted as if such rights, options and warrants
had not been issued.
For purposes of
Section 4(c)(i),
Section 4(c)(ii)
and this
Section 4(c)(iii),
if any dividend or distribution to which this
Section 4(c)(iii)
is applicable also includes one or both of:
(A) a
dividend or distribution of Ordinary Shares to which
Section 4(c)(i)
is applicable (the “Clause
A Distribution”);
or
(B) a
dividend or distribution of rights, options or warrants to
which
Section 4(c)(ii)
is applicable (the “Clause
B Distribution”),
then, in either case, (1) such dividend or distribution, other than
the Clause A Distribution and the Clause B Distribution, shall be
deemed to be a dividend or distribution to which this
Section 4(c)(iii)
is applicable (the “Clause
C Distribution”)
and any Exchange Rate adjustment required by this
Section 4(c)(iii)
with respect to such Clause C Distribution shall then be made, and
(2) the Clause A Distribution and Clause B Distribution shall be
deemed to immediately follow the Clause C Distribution and any
Exchange Rate adjustment required by
Section 4(c)(i)
and
Section 4(c)(ii)
with respect thereto shall then be made, except that, if determined
by Parent (I) the “Record Date” of the Clause A Distribution and
the Clause B Distribution shall be deemed to be the Record Date of
the Clause C Distribution and (II) any Ordinary Shares included in
the Clause A Distribution or Clause B Distribution shall be deemed
not to be “outstanding immediately prior to the close of business
on such Record Date or immediately after the open of business on
such Effective Date, as applicable” within the meaning of
Section 4(c)(i)
or “outstanding immediately prior to the close of business on such
Record Date” within the meaning of
Section 4(c)(ii).
(iv) If
any cash dividend or distribution is made to all or substantially
all holders of Ordinary Shares, the Exchange Rate shall be adjusted
based on the following formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the close of
business on the Record Date for such dividend or distribution;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the close of business
on the Record Date for such dividend or distribution;
|
|
|
SP0
|
|
=
|
|
the Last Reported Sale Price of the Ordinary Shares on the Trading
Day immediately preceding the Ex-Dividend Date for such dividend or distribution;
and
|
|
|
C
|
|
=
|
|
the amount in cash per share Parent distributes to all or
substantially all holders of Ordinary Shares.
|
Any increase pursuant to this
Section 4(c)(iv)
shall become effective immediately after the close of business on
the Record Date for such dividend or distribution. If such dividend
or distribution is not so paid, the Exchange Rate shall be
decreased, effective as of the date Parent determines not to make
or pay such dividend or distribution, to be the Exchange Rate that
would then be in effect if such dividend or distribution had not
been declared. Notwithstanding the foregoing, if “C” (as defined
above) is equal to or greater than “SP0” (as defined above), in
lieu of the foregoing increase, the Lender shall receive, in
respect of each $1.00 Principal amount of this Note, at the same
time and upon the same terms as holders of Ordinary Shares, the
amount of cash that the Lender would have received if it owned a
number of Ordinary Shares equal to the Exchange Rate on the
Ex-Dividend Date for such cash dividend or distribution.
(v) If
Parent or any of its Subsidiaries make a payment in respect of a
tender or exchange offer for the Ordinary Shares (other than an odd
lot tender offer), to the extent that the cash and value of any
other consideration included in the payment per Ordinary Share
exceeds the average of the Last Reported Sale Prices of
the
Annex A-12
Table of
Contents
Ordinary Shares over the 10 consecutive Trading Day period
commencing on, and including, the Trading Day next succeeding the
last date on which tenders or exchanges may be made pursuant to
such tender or exchange offer, the Exchange Rate shall be increased
based on the following formula:

where,
|
|
CR0
|
|
=
|
|
the Exchange Rate in effect immediately prior to the close of
business on the 10th Trading Day immediately following, and
including, the Trading Day next succeeding the date such tender or
exchange offer expires;
|
|
|
CR’
|
|
=
|
|
the Exchange Rate in effect immediately after the close of business
on the 10th Trading Day immediately following, and including, the
Trading Day next succeeding the date such tender or exchange offer
expires;
|
|
|
AC
|
|
=
|
|
the aggregate value of all cash and any other consideration (as
determined by Parent’s Board of Directors in good faith and in a
commercially reasonable manner) paid or payable for Ordinary Shares
purchased or exchanged in such tender or exchange offer;
|
|
|
OS
|
|
=
|
|
the number of Ordinary Shares outstanding immediately prior to the
date such tender or exchange offer expires (prior to giving effect
to the purchase or exchange of all Ordinary Shares accepted for
purchase or exchange in such tender or exchange offer);
|
|
|
OS’
|
|
=
|
|
the number of Ordinary Shares outstanding immediately after the
date such tender or exchange offer expires (after giving effect to
the purchase of all Ordinary Shares accepted for purchase or
exchange in such tender or exchange offer); and
|
|
|
SP’
|
|
=
|
|
the average of the Last Reported Sale Prices of the Ordinary Shares
over the 10 consecutive Trading Day period commencing on, and
including, the Trading Day next succeeding the date such tender or
exchange offer expires.
|
The increase to the Exchange Rate under this
Section 4(c)(v)
shall occur at the close of business on the 10th
Trading Day immediately following, and including, the Trading Day
next succeeding the date such tender or exchange offer
expires;
provided
that in respect of any exchange of Notes, if the relevant Exchange
Date occurs during the 10 Trading Days immediately following, and
including, the Trading Day next succeeding the expiration date of
any tender or exchange offer, references to “10” or
“10th”
in the preceding paragraph shall be deemed replaced with such
lesser number of Trading Days as have elapsed from, and including,
the Trading Day next succeeding the date that such tender or
exchange offer expires to, and including, the Exchange Date in
determining the Exchange Rate. If Parent or any of its Subsidiaries
is obligated to purchase Ordinary Shares pursuant to any such
tender or exchange offer described in this
Section 4(c)(v)
but is permanently prevented by applicable law from effecting any
such purchase or all such purchases are rescinded, the applicable
Exchange Rate will be readjusted to be the Exchange Rate that would
then be in effect if such tender or exchange offer had not been
made or had been made only in respect of the purchases that have
been made.
(vi) Notwithstanding
this
Section 4
or any other provision of this Note or the Loan Agreement, if an
Exchange Rate adjustment becomes effective on any Ex-Dividend Date,
and a Lender that has exchanged this Note (or portion thereof) on
or after such Ex-Dividend Date and on or prior to the related
Record Date would be treated as the record holder of Ordinary
Shares as of the related Exchange Date based on an adjusted
Exchange Rate for such Ex-Dividend Date, then, notwithstanding the
Exchange Rate adjustment provisions in this
Section 4,
the Exchange Rate adjustment shall not be made for such exchanging
Lender in respect of this Note (or portion thereof) so converted.
Instead, such Lender shall be treated as if such Lender were the
record owner of Ordinary Shares on an unadjusted basis and shall
participate in the related dividend, distribution or other event
giving rise to such adjustment.
(vii) Except
as stated herein, the Exchange Rate shall not be adjusted for the
issuance of Ordinary Shares or any securities convertible into or
exchangeable for Ordinary Shares or the right to purchase Ordinary
Shares or such convertible or exchangeable securities.
Annex A-13
Table of
Contents
(viii) In addition to those adjustments required
by
Section 4(c)(i),
Section 4(c)(ii),
Section
4(c)(iii),
Section 4(c)(iv)
and
Section 4(c)(v),
and to the extent permitted by applicable law and subject to the
applicable rules of any exchange on which any of Parent’s or the
Borrower’s securities are then listed, the Borrower from time to
time may increase the Exchange Rate by any amount for a period of
at least 20 Business Days if Parent determines that such increase
would be in the Borrower’s best interest. In addition, to the
extent permitted by applicable law and subject to the applicable
rules of any exchange on which any of Parent’s securities are then
listed, the Borrower may (but is not required to) increase the
Exchange Rate to avoid or diminish any income tax to holders of
Ordinary Shares or rights to purchase Ordinary Shares in connection
with a dividend or distribution of Ordinary Shares (or rights to
acquire Ordinary Shares) or similar event. Whenever the Exchange
Rate is increased pursuant to either of the preceding two
sentences, the Borrower shall notify the Lender in writing of the
increase at least 15 days prior to the date the increased Exchange
Rate takes effect, and such notice shall state the increased
Exchange Rate and the period during which it will be in
effect.
(ix) Notwithstanding
anything to the contrary in this
Section 4,
the Exchange Rate shall not be adjusted:
(A) upon
the issuance of any Ordinary Shares pursuant to any present or
future plan providing for the reinvestment of dividends or interest
payable on Parent’s securities and the investment of additional
optional amounts in Ordinary Shares under any plan;
(B) upon
the issuance of any Ordinary Shares or options or rights to
purchase those shares pursuant to any present or future employee,
director or consultant benefit plan or program of or assumed by
Parent or any of Parent’s Subsidiaries;
(C) upon
the issuance of any Ordinary Shares pursuant to any option,
warrant, right or exercisable, exchangeable or convertible security
not described in
Section 4(c)(ix)(B)
and outstanding as of the Effective Date;
(D) upon
the repurchase of any Ordinary Shares pursuant to an open market
share purchase program or other buy-back transaction, including
structured or derivative transactions such as accelerated share
repurchase transactions or similar forward repurchase transactions,
or other buy-back transaction, that is not a tender offer or
exchange offer of the kind described in
Section 4(c)(v);
(E) solely
for a change in par value of the Ordinary Shares; or
(F) for
accrued and unpaid interest, if any.
(x) All
calculations and other determinations under this
Section 4
shall be made by the Borrower and shall be made to the nearest
one-ten thousandth (1/10,000th)
of a share. If an adjustment to the Exchange Rate otherwise
required pursuant to this
Section 4
would result in a change of less than one percent (1%) to the
Exchange Rate, then, notwithstanding the foregoing, the Borrower
may, at its election, defer and carry forward such adjustment,
except that all such deferred adjustments must be given effect
immediately upon the earliest to occur of the following: (A) when
all such deferred adjustments would result in an aggregate change
of at least 1% to the Exchange Rate;
(B) on the
Exchange Date for any Exchange Amount, and (C) the date of any
Prepayment.
(xi) Whenever
the Exchange Rate is adjusted as herein provided, the Borrower
shall promptly provide written notice of such adjustment of the
Exchange Rate setting forth the adjusted Exchange Rate and the date
on which each adjustment becomes effective and shall deliver such
notice of such adjustment of the Exchange Rate to the Lender.
Failure to deliver such notice shall not affect the legality or
validity of any such adjustment.
(xii) For
purposes of this
Section 4(c),
the number of Ordinary Shares at any time outstanding shall not
include Ordinary Shares held in the treasury of Parent so long as
Parent does not pay any dividend or make any distribution on
Ordinary Shares held in the treasury of Parent, but shall include
Ordinary Shares issuable in respect of scrip certificates issued in
lieu of fractions of Ordinary Shares.
(d) Adjustments
of Prices.
Whenever any provision of this Note requires the Borrower to
calculate the Last Reported Sale Prices over a span of multiple
days, the Borrower shall make appropriate adjustments in good faith
and in a commercially reasonable manner (to the extent no
corresponding adjustment is otherwise made pursuant
Annex A-14
Table of
Contents
to the provision of
Section 4(c))
to each to account for any adjustment to the Exchange Rate that
becomes effective, or any event requiring an adjustment to the
Exchange Rate where the Ex-Dividend Date, Effective Date or
expiration date, as the case may be, of the event occurs, at any
time during the period when the Last Reported Sale Prices are to be
calculated.
(e) Effect
of Recapitalizations, Reclassifications and Changes of the Ordinary
Shares.
(i) In
the case of:
(A) any
recapitalization, reclassification or change of the Ordinary Shares
(other than a change to par value, or from par value to no par
value, or changes resulting from a subdivision or
combination),
(B) any
consolidation, merger or combination involving Parent,
(C) any
sale, lease or other transfer to a third party of all or
substantially all of the consolidated assets of Parent and Parent’s
Subsidiaries, or
(D) any
statutory share exchange,
in each case, as a result of which the Ordinary Shares would be
converted into, or exchanged for, stock, other securities, other
property or assets (including cash or any combination thereof) (any
such event, a “Merger
Event”),
then, at and after the effective time of such Merger Event, the
right to exchange each $1.00 Principal amount of this Note shall be
changed into a right to exchange such Principal amount into the
kind and amount of shares of stock, other securities or other
property or assets (including cash or any combination thereof) that
a holder of a number of Ordinary Shares equal to the Exchange Rate
immediately prior to such Merger Event would have owned or been
entitled to receive (the “Reference
Property,”
with each “unit
of Reference Property”
meaning the kind and amount of Reference Property that a holder of
one Ordinary Share is entitled to receive) upon such Merger Event
and, prior to or at the effective time of such Merger Event, the
Borrower, Parent or the successor or purchasing Person, as the case
may be, shall execute such documentation in form and substance
reasonably satisfactory to the Lender providing for such change in
the right to exchange each $1.00 Principal amount;
provided,
however,
that at and after the effective time of the Merger Event the number
of Ordinary Shares otherwise deliverable upon a Voluntary Exchange
or Forced Exchange shall instead be deliverable in the amount and
type of Reference Property that a holder of that number of Ordinary
Shares would have received in such Merger Event.
If the Merger Event causes the Ordinary Shares to be converted
into, or exchanged for, the right to receive more than a single
type of consideration (determined based in part upon any form of
shareholder election), then
(i) the
Reference Property into which this Note will be exchangeable shall
be deemed to be the weighted average of the types and amounts of
consideration actually received by the holders of Ordinary Shares,
and (ii) the unit of Reference Property for purposes of the
immediately preceding paragraph shall refer to the consideration
referred to in clause (i) attributable to one Ordinary Share. If
the holders of Ordinary Shares receive only cash in such Merger
Event, then for all exchanges for which the relevant Exchange Date
occurs after the effective date of such Merger Event (A) the
consideration due upon exchange of each $1.00 Principal amount
shall be solely cash in an amount equal to the Exchange Rate in
effect on the Exchange Date, multiplied by the price paid per
Ordinary Share in such Merger Event and (B) the Borrower shall
satisfy the obligation to Exchange this Note by paying cash to the
Lender on the fifth Business Day immediately following the relevant
Exchange Date. The Borrower shall notify the Lender of such
weighted average as soon as practicable after such determination is
made.
If, for any Merger Event, the Reference Property includes ordinary
shares or other shares of Common Equity, the documentation
described in the second immediately preceding paragraph shall
provide for anti-dilution and other adjustments that shall be as
nearly equivalent as is possible to the adjustments provided for in
this Note. If, in the case of any Merger Event, the Reference
Property includes shares of stock, securities or other property or
assets (excluding cash) of a Person other than the successor or
purchasing corporation, as the case may be, in such Merger Event,
then such documentation shall also be executed by such other Person
and shall contain such additional provisions to protect the
interests of the Lender as the Borrower in good faith shall
reasonably consider necessary by reason of the
foregoing.
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(ii) Neither
the Borrower nor Parent shall become a party to any Merger Event
unless its terms are consistent with this
Section 4(e)(i).
None of the foregoing provisions shall affect the right of the
Lender to exchange its Notes into Ordinary Shares as set forth
in
Section 4
prior to the effective date of such Merger Event.
(iii) The
above provisions of this
Section 4(e)
shall similarly apply to successive Merger Events.
(f) Notice
Prior to Certain Actions.
In case of any:
(i) action
by Parent or one of its Subsidiaries that would require an
adjustment in the Exchange Rate pursuant to
Section 4(c)
and
Section 4(g);
(ii) Merger
Event; or
(iii) voluntary
or involuntary dissolution, liquidation or winding-up of Parent or
the Borrower;
then, in each case (unless notice of such event is otherwise
required pursuant to another provision of this Note or the Loan
Agreement), the Borrower shall cause to be delivered to the Lender,
as promptly as possible but in any event at least 10 days prior to
the applicable date hereinafter specified, a notice stating (x) the
date on which a record is to be taken for the purpose of such
action by Parent or one of its Subsidiaries or, if a record is not
to be taken, the date as of which the holders of Ordinary Shares of
record are to be determined for the purposes of such action by
Parent or one of its Subsidiaries, or (y) the date on which such
Merger Event, dissolution, liquidation or winding-up is expected to
become effective or occur, and the date as of which it is expected
that holders of Ordinary Shares of record shall be entitled to
exchange their Ordinary Shares for securities or other property
deliverable upon such Merger Event, dissolution, liquidation or
winding-up. Failure to give such notice, or any defect therein,
shall not affect the legality or validity of such action by Parent
or one of its Subsidiaries, Merger Event, dissolution, liquidation
or winding-up.
(g) Shareholder
Rights Plans.
If Parent has a shareholder rights plan in effect upon exchange of
any Principal amount, each Ordinary Share, if any, issued upon such
exchange shall be entitled to receive the appropriate number of
rights, if any, and the certificates representing the Ordinary
Shares issued upon such exchange shall bear such legends, if any,
in each case as may be provided by the terms of any such
shareholder rights plan, as the same may be amended from time to
time. However, if, prior to any exchange of any Principal amount,
the rights have separated from the Ordinary Shares in accordance
with the provisions of the applicable shareholder rights plan, the
Exchange Rate shall be adjusted at the time of separation as if
Parent distributed to all or substantially all holders of Ordinary
Shares Distributed Property as provided in
Section 4(c)(iii),
subject to readjustment in the event of the expiration, termination
or redemption of such rights.
(h) Forced
Exchange.
(i) Subject
to the terms and conditions of this
Section 4
and
Section 5,
at any time when the Equity Payment Conditions are satisfied and
the Last Reported Sale Price for the five (5) Trading Days
immediately preceding the delivery of the applicable Forced
Exchange Notice is at least 200% of the Exchange Price, the
Borrower may cause the exchange into Ordinary Shares (a
“Forced
Exchange”)
of the outstanding Principal amount of this Note set forth in the
Forced Exchange Notice by delivery of a Forced Exchange Notice as
contemplated by
Section 4(h)(ii);
provided
that (A) the Principal amount of Notes exchanged pursuant to any
one Forced Exchange shall not exceed $5,000,000.00 at any one time,
(B) the aggregate Principal amount of Notes exchanged pursuant to a
Forced Exchange shall not exceed $10,000,000.00 within any one (1)
month period and (C) there must be at least 15 Trading Days between
the delivery of any two Forced Exchange Notices. The Borrower shall
effect each Forced Exchange under each of the Notes on a pro rata
basis, based upon the respective outstanding Principal amounts
thereof.
(ii) To
effect a Forced Exchange, the Borrower shall send a written notice
via electronic mail to the Lender (a “Forced
Exchange Notice”)
at any time between 4:00 p.m. and 6:00 p.m., New York City time on
the Trading Day on which Borrower wishes to effect a Forced
Exchange. The Forced Exchange Notice shall certify that the Equity
Payment Conditions and the other applicable conditions set forth in
this
Section 4
and
Section 5
have been satisfied (including reasonable supporting information),
shall state the Principal amount hereunder that the Borrower shall
cause to be exchanged on the Exchange Date and shall state the
number of Ordinary Shares to be issued to the Lender (subject
to
Section 4(h)(iii)
and the other terms and conditions of this
Section 4(h)).
Simultaneously with delivery of a Forced Exchange Notice hereunder,
the Borrower shall send a Forced Exchange Notice with respect to a
pro rata portion of the principal of each other Note.
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(iii) By
no later than 5:00 p.m., New York City time on the second Trading
Day following the date of the Forced Exchange Notice, the Lender
shall confirm to Borrower via electronic mail whether the
Beneficial Ownership Limitation will reduce the number of shares
that may be issued pursuant to such Forced Exchange (the
“Forced
Exchange Lender Notice”).
If the Beneficial Ownership Limitation will so reduce the number of
Ordinary Shares that may be issued pursuant to the Forced Exchange,
the Forced Exchange Lender Notice shall also set forth the maximum
number of Ordinary Shares that may be issued to the Lender (and the
corresponding Principal amount hereunder that may be exchanged)
without exceeding the maximum number of shares that such Lender may
receive under the Beneficial Ownership Limitation (the
“Forced
Exchange Maximum Share Amount”).
The number of Ordinary Shares issuable pursuant to the Forced
Exchange shall equal the number of Ordinary Shares set forth in the
Forced Exchange Notice;
provided,
however,
that, if the issuance of the number of Ordinary Shares set forth in
the Forced Exchange Notice would violate the Beneficial Ownership
Limitation or the Exchange Cap, the number of Ordinary Shares
issuable pursuant to the Forced Exchange shall instead equal the
lesser of the Forced Exchange Maximum Share Amount and such amount
as would not exceed the Exchange Cap (and the Principal amount
hereunder to be exchanged on the applicable Exchange Date in such
Forced Exchange shall be correspondingly reduced).
(iv) The
Ordinary Shares issuable pursuant to a Forced Exchange shall be
delivered within the timeframe and in accordance with
Section 4(b).
(i) Notice
to the Administrative Agent.
(i) Notwithstanding
anything contained herein to the contrary, (A) in connection with
any Exchange, the Borrower shall provide the Administrative Agent
with prompt written notice of such Exchange (which, in the case of
a Forced Exchange, shall be no less than five (5) Business Days
prior to such Exchange) which shall include the details thereof,
and (B) in connection with any Exchange, upon delivery of any
Ordinary Shares to any Lender, the Borrower will provide the
Administrative Agent with (y) written confirmation of (I) such
delivery, and
(II) the amount
of the principal of the Term Loans, the accrued and unpaid interest
thereon, any applicable Interest Make-Whole Payment and any other
amounts, that are deemed paid as a result of the delivery of the
Ordinary Shares to the Lender in connection with such Exchange, and
(z) an irrevocable instruction to reflect in the Register the
payment of such amounts that are deemed paid as a result of the
delivery of the Ordinary Shares to the Lender.
(ii) The
Borrower shall provide reasonable prior written notification to the
Administrative Agent of any payments (including, without
limitation, any Interest Make-Whole Payments or Exit Fee) to be
made in cash in connection with any Exchange and, no later than
2:00 pm Eastern Time two Business Days from the date of such
Exchange, make such cash payments to the Administrative Agent;
provided, however, the Administrative Agent shall only be required
to use commercially reasonable efforts to distribute such funds to
the applicable Secured Parties on such date of Exchange and in no
event shall the Administrative Agent be liable if such funds are
not so distributed on such date of Exchange.
5. Equity
Issuance Limitations.
Notwithstanding anything in this Note or the Loan Agreement to the
contrary, the following provisions shall apply.
(a) Shareholder
Approval.
Unless and until Shareholder Approval has been obtained, (i) the
maximum number of Ordinary Shares that may be issued pursuant to
the Loan Agreement and all of the Notes shall not exceed 14,868,724
(the “Exchange
Cap”);
provided,
that the Exchange Cap shall be appropriately adjusted to reflect
any event pursuant to which the Exchange Rate is adjusted pursuant
to
Section 4
occurring after the Funding Date and following any adjustment of
the Exchange Cap hereunder, the “Exchange
Cap”
shall mean the Exchange Cap as so adjusted, and (ii) no Ordinary
Shares shall be issued for any reason pursuant to the Loan
Agreement or this Note to the extent that, assuming all outstanding
Ordinary Shares issued and issuable upon Exchange have been issued,
such issuance would exceed the Exchange Cap.
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(b) Beneficial
Ownership Limitations.
(i) Notwithstanding
anything to the contrary in the Loan Agreement or this Note, the
Lender will not be entitled to receive Ordinary Shares upon
Exchange, as payment of interest, or in satisfaction of any
Interest Make-Whole Payment, Installment Payment or otherwise, and
no Exchange or payment of interest, Interest Make-Whole Payment,
Installment Payment, or other payment in Ordinary Shares shall take
place, to the extent (but only to the extent) that such receipt (or
exchange) would cause the Lender and its affiliates (as defined in
Rule 12b-2 under the Exchange Act) and associates (as defined in
Rule 12b-2 under the Exchange Act), in each case together with any
other Persons whose beneficial ownership would be aggregated with
any of the foregoing Persons for purposes of Section 13(d) of the
Exchange Act (including, without limitation, any “group” of which
such Person is a member) to beneficially own Ordinary Shares in
excess of the Beneficial Ownership Limitation. For purposes of the
foregoing sentence, the number of Ordinary Shares beneficially
owned by the Lender and its affiliates shall include the number of
Ordinary Shares issuable in respect of any obligation under this
Note or any other Notes beneficially owned by the Lender, its
affiliates (as defined in Rule 12b-2 under the Exchange Act), its
associates (as defined in Rule 12b-2 under the Exchange Act) or any
other Persons whose beneficial ownership would be aggregated with
any of the foregoing Persons for purposes of Section 13(d) of the
Exchange Act (including, without limitation, any “group” of which
such Person is a member) with respect to which such determination
is being made, but shall exclude the number of Ordinary Shares
which are issuable upon (i) any other obligation not being
simultaneously satisfied in Ordinary Shares under this Note or any
of the Notes beneficially owned by the Lender, its affiliates (as
defined in Rule 12b-2 under the Exchange Act), its associates (as
defined in Rule 12b-2 under the Exchange Act) or any other Persons
whose beneficial ownership would be aggregated with any of the
foregoing Persons for purposes of Section 13(d) of the Exchange Act
(including, without limitation, any “group” of which such Person is
a member) and (ii) the exercise or exchange of the unexercised or
unexchanged portion of any other securities of Parent or its
Affiliates subject to a limitation on exchange or exercise
analogous to the limitation contained herein (including, without
limitation, any other Notes) beneficially owned by the Lender, its
affiliates (as defined in Rule 12b-2 under the Exchange Act), its
associates (as defined in Rule 12b-2 under the Exchange Act) or any
other Persons whose beneficial ownership would be aggregated with
any of the foregoing Persons for purposes of Section 13(d) of the
Exchange Act (including, without limitation, any “group” of which
such Person is a member). Except as set forth in the preceding
sentence, for purposes of this provision, beneficial ownership
shall be calculated in accordance with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder.
Any purported delivery of Ordinary Shares in violation of
this
Section 5(b)
shall be void and have no effect to the extent (but only to the
extent) that such delivery would result in the exchanging Lender
violating the Beneficial Ownership Limitations.
(ii) To
the extent that the limitation contained in this
Section 5(b)
applies, the determination of whether this Note is exchangeable or
whether payment in or delivery of Ordinary Shares can be made (in
relation to other securities beneficially owned by the Lender) and
of which Principal amount of this Note is exchangeable shall be in
the sole discretion of the Lender, and the submission of an
Exchange Notice shall be deemed to be the Lender’s determination of
whether any Notes may be exchanged (in relation to other securities
beneficially owned by the Lender) and which Principal amount such
Notes are exchangeable, in each case subject to the Beneficial
Ownership Limitation. To ensure compliance with this restriction,
the Lender shall be deemed to represent to the Borrower and Parent
each time it delivers an Exchange Notice or Forced Exchange Notice
that such Exchange Notice has not violated the restrictions set
forth in this
Section 5(b)
or such Forced Exchange Notice accurately sets forth the Forced
Exchange Maximum Share Amount, as applicable, and the Borrower and
Parent shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a determination as to any group
status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. Further, to the extent any proposed
delivery of Ordinary Shares in respect of any Installment Payment,
interest payment or Interest Make-Whole Payment could violate the
restrictions set forth in this
Section 5(b),
the Lender shall provide notice thereof (and of the maximum number
of Ordinary Shares that could be delivered in compliance with the
restrictions set forth in this
Section 5(b))
to the Borrower and Parent no later than the last Trading Day
included in the calculation of the relevant Floating Share Price,
and, in which case, (A) neither the Borrower nor Parent shall
deliver Ordinary Shares in excess of such maximum amount and (B)
the Equity Payment Conditions shall be deemed not to be satisfied
solely to the extent and with respect to the amount that such
excess exceeds the number of Excluded Ordinary Shares on the date
of determination.
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(iii) To
the extent any Ordinary Shares are not delivered in connection with
any Exchange, payment of interest, Interest Make-Whole Payment,
Installment Payment or otherwise due to the operation of
this
Section 5(b),
the obligation to deliver such Ordinary Shares shall not be
extinguished and upon the applicable Lender certifying to the
Borrower and Parent that the person (or persons) receiving Ordinary
Shares upon exchange or in respect of payment is not, and would
not, as a result of such exchange, become the beneficial owner of
Ordinary Shares outstanding at such time in excess of the
applicable Beneficial Ownership Limitations, the Borrower and
Holdings shall cause to be delivered any such Ordinary Shares
withheld on account of such applicable Beneficial Ownership
Limitations by the later of (x) the date such shares were otherwise
due to such person (or persons) and (y) two Trading Days after
receipt of such certification;
provided,
however,
until such time as the affected Lender gives such notice,
notwithstanding the provisions of
Section 7,
no person shall be deemed to be the shareholder of record with
respect to the Ordinary Shares otherwise deliverable upon exchange
in excess of any applicable Beneficial Ownership
Limitations.
(iv) For
purposes of this
Section 5(b),
in determining the number of outstanding Ordinary Shares, the
Lender may rely on the number of outstanding Ordinary Shares as
stated in the most recent of the following: (A) Parent’s most
recent periodic or annual report filed with the SEC, as the case
may be, (B) a more recent public announcement by Parent, or (C) a
more recent written notice by Parent or the Transfer Agent to the
Lender (or its trading manager) setting forth the number of
Ordinary Shares outstanding. Upon the written or oral request of
the Lender, the Borrower and Parent shall within two Trading Days
confirm orally and in writing to the Lender the number of Ordinary
Shares then outstanding. In any case, the number of outstanding
Ordinary Shares shall be determined after giving effect to the
exchange or exercise of, or issuance of Ordinary Shares pursuant to
the terms of, securities of the Borrower or Parent, including the
Notes, by the Lender since the date as of which such number of
outstanding Ordinary Shares was reported.
(v) The
“Beneficial
Ownership Limitation”
shall be 9.9% of the number of Ordinary Shares outstanding
immediately after giving effect to the issuance of Ordinary Shares
pursuant to which such determination is being made. The Lender may
elect a beneficial ownership limit that is less than or equal to
the then-applicable Beneficial Ownership Limitation or, upon not
less than 61 days’ prior written notice to the Borrower, greater
than the then-applicable Beneficial Ownership Limitation,
provided
that such amount elected beneficial ownership limitation shall not
exceed 9.9%.
6. Certain
Covenants.
(a) The
Borrower and Parent covenant and agree that Parent shall at all
times reserve and keep available out of its authorized but unissued
Ordinary Shares solely for the purpose of effecting Exchanges of
this Note, such number of Ordinary Shares, prior to the receipt of
Shareholder Approval, that shall be the aggregate maximum number
that may be exchanged under this Note without exceeding the
Exchange Cap, and following receipt of Shareholder Approval, as
shall from time to time be sufficient to effect the exchange of the
entire Principal convertible under this Note (without giving effect
to the Beneficial Ownership Limitation), assuming that any
Exchanges will be at the Exchange Price.
(b) The
Borrower and Parent covenant and agree that, upon any issuance of
Ordinary Shares in accordance with the terms of this Note and due
registration on the books of the Transfer Agent and registrar
therefor in the name or on behalf of the respective holder, all
such Ordinary Shares shall be duly authorized, validly issued,
fully paid and nonassessable and not subject to any preemptive
rights, rights of first refusal or similar rights of any Person or
any taxes, liens or charges with respect to the issue
thereof.
(c) The
Borrower and Parent covenant and agree that, if any Ordinary Shares
issued pursuant to the terms of this Note require registration with
or approval of any governmental authority under any applicable law
before such Ordinary Shares may be validly issued upon exchange,
the Parent will secure such registration or approval, as the case
may be.
(d) The
Borrower and Parent covenant and agree that if at any time the
Ordinary Shares shall be listed on any national securities exchange
or automated quotation system Parent will list and keep listed, so
long as the Ordinary Shares shall be so listed on such exchange or
automated quotation system, any Ordinary Shares issuable pursuant
to the terms of the Notes.
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(e) The
Borrower and Parent acknowledge that the allotment and issue of
Ordinary Shares and the delivery of Ordinary Shares, if any,
hereunder (whether upon Exchange or otherwise) by Parent will, at
the Parent’s option, either (i) create an equivalent debt owing
from the Borrower to Parent or (ii) be deemed to be a contribution
of equity from Parent to the Borrower.
7. Settlement
Mechanics.
(a) Dispute
Resolution.
In the case of a dispute as to the determination of the number of
Ordinary Shares deliverable in connection with any Installment
Payment, payment of interest, Interest Make-Whole Payment, Exchange
or Prepayment, the Borrower shall instruct the Transfer Agent to
issue to the Lender the number of Ordinary Shares that is not
disputed on the delivery date for such Ordinary Shares specified in
this Note and shall transmit an explanation of the disputed
determinations or arithmetic calculations to the Lender via
electronic mail within ten (10) days of receipt or deemed receipt
of the date such number of Ordinary Shares was fixed for payment
under the Loan Agreement and this Note. If the Lender and Borrower
are unable to agree upon the appropriate determinations or
calculations within five (5) days of such disputed determinations
or calculations being transmitted to the Lender, then Borrower
shall promptly (and in any event within three (3) Business Days)
submit via electronic mail (A) the disputed determinations to an
independent, reputable investment banking firm agreed to by
Borrower and the Required Lenders, or (B) the disputed calculations
to Borrower’s independent registered public accounting firm, as the
case may be. Borrower shall direct the investment bank or the
accounting firm, as the case may be, to perform the determinations
or calculations and notify Borrower and the Lender of the results
no later than two (2) Business Days from the time it receives the
disputed determinations or calculations. Such investment bank’s or
accounting firm’s determination or calculation, as the case may be,
shall be binding upon all parties absent manifest error, and the
fees and expenses of such investment bank or accountant shall be
paid by the Borrower and Lender in equal shares. Upon resolution of
any dispute pursuant to this
Section 7(a),
the Borrower shall provide an irrevocable instruction to the
Administrative Agent to adjust in the Register the outstanding
principal and interest amount owing to such Lender in accordance
with such resolution and the Administrative Agent shall be able to
conclusively rely on such instruction and shall incur no liability
for adjusting the Register in accordance with such
instruction.
(b) Record
Holder.
Subject to the provisions of
Section 5(b),
the Person or Persons entitled to receive the Ordinary Shares
issuable upon any Installment Payment, payment of interest,
Interest Make-Whole Payment, Exchange or Prepayment of this Note
shall be treated for all purposes as the legal and record holder or
holders of such Ordinary Shares, (A) in the case of a Voluntary
Exchange, upon delivery by the Lender of the Exchange
Notice,
(B) in the case
of a Forced Exchange, upon delivery by the Lender to the Borrower
the Forced Exchange Lender Notice, (C) in the case of any
Installment Payment, payment of interest, Interest Make-Whole
Payment or Prepayment, on the date such payment is required to be
made in accordance with the terms of the Loan Agreement and this
Note or (D) in the case of Ordinary Shares the issuance of which is
subject to a
bona fide
dispute that is subject to and being resolved pursuant to, and in
compliance with the time periods and other provisions of, the
dispute resolution provisions of
Section 7(a),
the first Business Day after the resolution of such
bona fide
dispute.
(c) Book-Entry.
Notwithstanding anything to the contrary set forth herein, upon
Exchange or Prepayment in accordance with the terms hereof or of
the Loan Agreement, the Lender shall not be required to physically
surrender this Note to the Borrower unless all of the Principal is
being exchanged or prepaid. The Lender and the Borrower shall
maintain records showing the Principal exchanged or prepaid and the
dates of such Exchanges or prepayments or shall use such other
method, reasonably satisfactory to the Lender and the Borrower, so
as not to require physical surrender of this Note upon any such
partial Exchange or Prepayment. Notwithstanding the foregoing, if
this Note is exchanged or prepaid as aforesaid, the Lender may not
transfer this Note unless the Lender first physically surrenders
this Note to the Borrower, whereupon the Borrower will forthwith
issue and deliver upon the order of the Lender a new Note of like
tenor, registered as the Lender may request, representing in the
aggregate the remaining Principal represented by this Note. The
Lender and any assignee, by acceptance of this Note, acknowledge
and agree that, by reason of the provisions of this paragraph,
following Exchange or Prepayment of any portion of this Note, the
Principal of this Note may be less than the “Original Principal
Amount” stated on the face hereof.
(d) Buy-In.
In addition to any other rights available to the Lender (including
those associated with any applicable Event of Default), if the
Borrower and Parent shall fail for any reason or for no reason to,
prior to 5:00 p.m. (New York City time) on the applicable delivery
date (taking into account any delayed delivery pursuant to
(i)
Section 5(b)
and (ii) solely to the extent Borrower prevails in any
dispute,
Section 7(a))
specified in this Note, issue and deliver to the Lender the number
of Ordinary Shares to which the Lender is entitled pursuant to the
terms
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of this Note, and if after such date the Lender is required by its
broker to purchase (in an open market transaction or otherwise) or
the Lender’s brokerage firm otherwise purchases, Ordinary Shares to
deliver in satisfaction of a sale by the Lender of the Ordinary
Shares that the Lender anticipated receiving in satisfaction of any
Installment Payment, payment of interest, Interest Make-Whole
Payment, Exchange or Prepayment (a “Buy-In”),
then the Borrower shall (A) pay in cash to the Lender the amount,
if any, by which (x) the Lender’s total purchase price (including
brokerage commissions, if any) for the Ordinary Shares so purchased
exceeds (y) the amount obtained by multiplying (1) the number of
Ordinary Shares that the Borrower was required to deliver to the
Lender in connection such Installment Payment, payment of interest,
Interest Make-Whole Payment, Exchange or Prepayment at issue
multiplied by
(2) the actual sale price at which the sell order giving rise to
such purchase obligation was executed, and (B) at the option of the
Lender, either (x) in the case of an Exchange, reinstate the
portion of the Principal amount, as of the date that the Lender
provides notice to the Borrower and the Administrative Agent of its
election to reinstate such Principal amount, for which such
Exchange was not honored (in which case such Exchange shall be
deemed rescinded for purposes of such Principal amount) and pay
directly to such Lender in cash the amount of any interest with
respect to such reinstated portion of Principal amount from, and
including, the date of such Exchange to, but excluding, the date
such portion of Principal amount was reinstated, (y) in the case of
an Installment Payment, payment of interest, Interest Make-Whole
Payment or Prepayment, notwithstanding any election by the Borrower
to the contrary, require the Borrower to make such payment directly
to the Lender in cash rather than in Ordinary Shares, or (z)
deliver to the Lender the number of Ordinary Shares that would have
been issued had the Borrower timely complied with its issuance and
delivery obligations hereunder. For example, if the Lender
purchases Ordinary Shares having a total purchase price of $11,000
to cover a Buy-In with respect to an attempted Exchange of this
Note for Ordinary Shares with an aggregate sale price giving rise
to such purchase obligation of $10,000, under clause (A) of the
immediately preceding sentence the Borrower shall be required to
pay the Lender $1,000. The Lender shall provide the Borrower and
the Administrative Agent written notice indicating the amounts
payable to the Lender in respect of the Buy-In and, upon request of
the Borrower, evidence of the amount of such loss. Nothing herein
shall limit the Lender’s right to pursue any other remedies
available to it hereunder (including those associated with any
appliable Event of Default), at law or in equity including a decree
of specific performance or injunctive relief with respect to the
Borrower’s failure to timely deliver Ordinary Shares in
satisfaction of any Installment Payment, payment of interest,
Interest Make-Whole Payment, Exchange or Prepayment as required
pursuant to the terms hereof.
(e) Fractional
Shares.
If the issuance of any Ordinary Shares in connection with any
Installment Payment, payment of interest, Interest Make-Whole
Payment, Exchange or Prepayment would result in the issuance of a
fraction of an Ordinary Share, then Borrower shall round such
fraction of a share up or down to the nearest whole share (with 0.5
rounded up).
(f) Stamp
Taxes.
The Borrower shall pay any documentary, stamp or similar issue or
transfer tax due on the issuance of any Ordinary Shares upon any
Installment Payment, payment of interest, Interest Make-Whole
Payment, Exchange or Prepayment, unless the tax is due because the
Lender requests such shares to be issued in a name other than the
Lender’s name, in which case the Lender shall pay that
tax.
8. Guarantee.
The obligations of the Borrower under this Note are fully and
unconditionally guaranteed as set forth in the Loan Agreement by
Parent and each of the other Guarantors.
9. Amendment;
Waiver.
The provisions of this Note may only be waived or amended,
restated, supplemented or otherwise modified in accordance with the
Loan Agreement.
10. Failure
or Indulgence Not Waiver.
No delay or omission by the Lender in exercising any power or right
hereunder shall impair such right or power or be construed to be a
waiver of any default, nor shall any single or partial exercise of
any power or right hereunder preclude the full exercise thereof or
the exercise of any other power or right. No renewal or extension
of this Note or the Loan Agreement, no delay in the enforcement of
payment under this Note or the Loan Agreement, and no delay or
omission in exercising any right or power under this Note or the
Loan Agreement shall affect the liability of the Borrower or any
endorser of this Note.
11. Notices.
Whenever notice is required to be given under this Note, unless
otherwise provided herein, such notice shall be given in accordance
with Section 10 of the Loan Agreement.
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12. Restrictions
on Transfer.
(a) Registration
or Exemption Required.
This Note has been issued in a transaction exempt from the
registration requirements of the Securities Act. None of the Note
or the Ordinary Shares issuable hereunder may be transferred, sold,
assigned, hypothecated or otherwise disposed of except pursuant to
an effective registration statement or an exemption to the
registration requirements of the Securities Act and applicable
state laws, including Rule 144 under the Securities Act, Section
4(a)(7) of the Securities Act or a so-called “4[(a)](1) and a half”
transaction.
(b) Assignment.
This Note is assignable or transferable, in whole or in part, only
(i) as part of the assignment or transfer of an interest in the
Term Loans made pursuant to the Loan Agreement and recorded on the
Register or a Participant Register and (ii) to the extent such
assignment or transfer is permitted pursuant to the terms of the
Loan Agreement;
provided
that, in connection with a permitted transfer thereunder, the
Lender shall deliver a written notice to Borrower, substantially in
the form of the Assignment attached hereto as
Exhibit B,
indicating the Person or Persons to whom the Note shall be assigned
and the respective Principal amount of the Note to be assigned to
each assignee.
13. Waiver
of Notice.
Other than those notices required to be provided by the Lender to
Borrower under the terms of the Loan Agreement, Borrower and every
endorser of this Note, or the obligations represented hereby,
expressly waives diligence, presentment, protest, demand, notice of
dishonor, non-payment or default, and notice of any kind with
respect to this Note and the Loan Agreement or the performance of
the obligations under this Note
and/or
the Loan Agreement.
14. Governing
Law.
This Note shall be governed by, and construed and interpreted in
accordance with, the internal laws of the State of New
York.
15. Miscellaneous.
This Note is a Loan Document, is entitled to the benefits of the
Loan Documents and is subject to the provisions of the Loan
Agreement.
16. Administrative
Agent.
The Administrative Agent shall be an express third party
beneficiary of this Note entitled to enforce the provisions hereof.
For the avoidance of doubt, no provision of this Note shall be
deemed to impose any duty or obligation on the Administrative Agent
or otherwise affect its rights, protections, immunities or
indemnities under the Loan Agreement and the other Loan
Documents.
17. Signatures.
Delivery of an executed counterpart of a signature page of this
Note by facsimile, portable document format (.pdf) or other
electronic transmission will be as effective as delivery of a
manually executed counterpart hereof.
[Signature
Page Follows]
Annex A-22
Table of
Contents
IN WITNESS WHEREOF, the Borrower and Parent have caused this Note
to be executed and delivered by its duly authorized officer as of
the day and year set forth above.
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Gamida Cell Inc.
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By:
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/s/ Abigail L. Jenkins
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Name: Abigail L. Jenkins
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Title: President and Chief Executive Officer
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Gamida Cell Ltd.
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By:
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/s/ Shai Lankry
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Name: Shai Lankry
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Title: Chief Financial Officer
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Annex A-23
Table of
Contents
Exhibit A
EXCHANGE NOTICE
Reference is made to the First Lien Secured Note (the
“Note”)
of Gamida Cell Inc., a Delaware corporation (the
“Borrower”),
and Gamida Cell Ltd., a limited liability company organized under
the laws of the State of Israel (“Parent”),
in the original principal amount of $[____]. In accordance with and
pursuant to the Note, the undersigned hereby elects to Exchange the
Exchange Amount of the Note indicated below into Ordinary Shares as
of the date specified below.
Date of Exchange:
Principal Amount to be Exchanged at the Exchange Rate:
Please confirm the following information:
Number of Ordinary Shares to be issued:
Maximum Number of Ordinary Shares that may be received pursuant to
the Beneficial Ownership Limitation:
Please issue the Ordinary Shares into which the Note is being
converted in the following name and to the following
address:
Issue to:
Facsimile Number:
Authorization:
By:
Title:
Dated:
DTC Participant Number and Name:
Account Number:
Annex A-24
Table of
Contents
Exhibit B
ASSIGNMENT
(To be executed by the registered holder desiring to transfer the
Note)
FOR VALUE RECEIVED, the undersigned holder of the attached First
Lien Secured Note (the “Note”)
hereby sells, assigns and transfers unto the person or persons
below named the right to receive the principal amount of $[____]
from Gamida Cell Inc., a Delaware corporation (the
“Borrower”),
and Gamida Cell Ltd., a limited liability company organized under
the laws of the State of Israel, evidenced by the attached Note and
does hereby irrevocably constitute and appoint attorney to transfer
the said Note on the books of the Borrower, with full power of
substitution in the premises.
Dated:
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Signature
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Fill in for new registration of Note:
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Name
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Address
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Please print name and address of assignee
(including zip code number)
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NOTICE
The signature to the foregoing Assignment must correspond to the
name as written upon the face of the attached Note.
Annex A-25
Table of
Contents

GAMIDA CELL LTD. C/O BROADRIDGE
CORPORATE ISSUER SOLUTIONS, INC. P.O. BOX 1342 BRENTWOOD, NY 11717
SCAN TO VIEW MATERIALS & VOTE VOTE BY INTERNET -
www.proxyvote.com or scan the QR Barcode above Use the Internet to
transmit your voting instructions and for electronic delivery of
information up until 11:59 p.m. Eastern Time on February 13, 2023.
Have your proxy card in hand when you access the web site and
follow the instructions to obtain your records and to create an
electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE
PROXY MATERIALS If you would like to reduce the costs incurred by
our company in mailing proxy materials, you can consent to
receiving all future proxy statements, proxy cards and annual
reports electronically via e-mail or the Internet. To sign up for
electronic delivery, please follow the instructions above to vote
using the Internet and, when prompted, indicate that you agree to
receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to
transmit your voting instructions up until 11:59 p.m. Eastern Time
on February 13, 2023. Have your proxy card in hand when you call
and then follow the instructions. VOTE BY MAIL Mark, sign and date
your proxy card and return it in the postage-paid envelope we have
provided or return it to Vote Processing, c/o Broadridge, 51
Mercedes Way, Edgewood, NY 11717. TO VOTE, MARK BLOCKS BELOW IN
BLUE OR BLACK INK AS FOLLOWS: D95043-S60536 KEEP THIS PORTION FOR
YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
DETACH AND RETURN THIS PORTION ONLY
Table of
Contents

Important Notice Regarding the
Availability of Proxy Materials for the Special General Meeting:
The Proxy Statement is available at www.proxyvote.com.
D95044-S60536 GAMIDA CELL LTD. THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS FOR THE SPECIAL GENERAL MEETING OF
SHAREHOLDERS TO BE HELD ON FEBRUARY 14, 2023 The undersigned, a
shareholder of Gamida Cell Ltd. (the “Company”), hereby appoints
Abigail Jenkins and Shai Lankry, and each of them, acting
individually as the attorney and proxy for the undersigned, with
full power of substitution, for and in the name of the undersigned,
to vote and otherwise act on behalf of the undersigned at the
Special General Meeting of Shareholders of the Company (the
“Meeting”) to be held at 12 Leshem Street, Kiryat Gat, 8258412,
Israel, on Tuesday February 14, 2023, at 5:00 p.m. Israel Time, or
at any adjournment(s) or postponement(s) thereof, with respect to
all of the Ordinary Shares of the Company (the “Shares”) which the
undersigned would be entitled to vote as indicated with respect to
the matter set forth below this Proxy. Subject to applicable law
and the rules of Nasdaq, in the absence of such instructions, the
Shares represented by properly executed and received proxies will
be voted “FOR” the proposed resolution to be presented at the
Meeting or any adjournment(s) or postponement(s) thereof, for which
the Board of Directors of the Company recommends a “FOR” vote. This
Proxy also delegates, to the extent permitted by applicable law,
discretionary authority to vote with respect to any other business
which may properly come before the Meeting or any adjournment(s) or
postponement(s) thereof. WHETHER OR NOT YOU EXPECT TO ATTEND THE
MEETING, PLEASE COMPLETE, DATE AND SIGN THIS PROXY AND MAIL THE
ENTIRE PROXY PROMPTLY, ALONG WITH PROOF OF IDENTITY IN ACCORDANCE
WITH THE COMPANY’S PROXY STATEMENT, IN THE ENCLOSED ENVELOPE IN
ORDER TO ASSURE REPRESENTATION OF YOUR SHARES. NO POSTAGE NEED BE
AFFIXED IF THE PROXY IS MAILED IN THE UNITED STATES.