Exhibit 99.2
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
May 6, 2020
Date of Report (Date of earliest event reported)
8i ENTERPRISES ACQUISITION CORP.
(Exact Name of Registrant as Specified in its Charter)
| British Virgin Islands | 001-38849 | N/A | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
6 Eu Tong Sen Street #08-13 The Central Singapore |
059817 | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: +65 67880388
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| [X] | Written communications pursuant to Rule 425 under the Securities Act |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Ordinary Shares | JFK | The Nasdaq Stock Market LLC | ||
| Warrants | JFKKW | The Nasdaq Stock Market LLC | ||
| Units | JFKKU | The Nasdaq Stock Market LLC | ||
| Rights | JFKKR | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company [X]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
IMPORTANT NOTICES
8i Enterprises Acquisition Corp, a British Virgin Islands business company (“JFK”), Diginex Limited, a Singapore public company limited by shares (“Singapore NewCo”), DIGITAL INNOVATIVE LIMITED, a British Virgin Islands business company (“BVI NewCo”), and Diginex Limited, a Hong Kong company (“Diginex”), and their respective directors, executive officers and employees and other persons may be deemed to be participants in the solicitation of proxies from the holders of JFK ordinary shares in respect of the proposed transactions described herein (the “Business Combination”). Information about JFK’s directors and executive officers and their ownership of JFK’s ordinary shares is set forth in JFK’s Prospectus, dated March 27, 2019, and Quarterly Report on Form 10-K, dated December 10, 2019, filed with the Securities and Exchange Commission (the “SEC”), as modified or supplemented by any Form 4 filed with the SEC since the date of such filing. Other information regarding the interests of the participants in the proxy solicitation will be included in the proxy statement/prospectus included in the Registration Statement on Form F-4/A jointly filed by Singapore NewCo and JFK pertaining to the Business Combination (the “Form F-4”). These documents can be obtained free of charge from the sources indicated above.
In connection with the Business Combination described herein, Singapore NewCo has filed the Form F-4, which includes and serves as a proxy statement/prospectus for JFK’s shareholders. JFK has mailed the definitive proxy statement/prospectus and a proxy card to each shareholder entitled to vote at the meeting relating to the approval of the Business Combination and other proposals set forth in the proxy statement. INVESTORS AND SECURITY HOLDERS OF JFK ARE URGED TO READ THESE MATERIALS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE BUSINESS COMBINATION THAT JFK WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT JFK, SINGAPORE NEWCO, BVI NEWCO, DIGINEX AND THE BUSINESS COMBINATION. The definitive proxy statement/prospectus and other relevant materials in connection with the Business Combination (when they become available), and any other documents filed by JFK with the SEC, may be obtained free of charge at the SEC’s website (www.sec.gov) or by writing to 8i Enterprises Acquisition Corp, 6 Eu Tong Sen Street, #08-13 The Central, Singapore.
This Current Report on Form 8-K contains certain “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the pending Business Combination by and among JFK, Singapore NewCo, BVI NewCo and Diginex and the transactions contemplated thereby, and the parties’ perspectives and expectations, are forward-looking statements. Such statements include, but are not limited to, statements regarding the proposed transaction, including the anticipated initial enterprise value and post-closing equity value, the benefits of the proposed transaction, expected revenue opportunities, anticipated future financial and operating performance and results, including estimates for growth, expected management and governance, the ability to close the Business Combination, and the expected timing of the transactions contemplated by the (i) merger agreement by and among Singapore NewCo, BVI NewCo and JFK, dated October 8, 2019, and (ii) share exchange agreement by and among JFK, Diginex, the stockholders of Diginex set forth therein (the “Sellers”), and Pelham Limited, as the representative of the Sellers (the “Representative”), dated July 9, 2019 (the “Share Exchange Agreement”), as amended by the amendment and joinder to the Share Exchange Agreement, dated October 8, 2019, by and among JFK, Singapore NewCo, BVI NewCo, the Sellers, Diginex and the Representative (the “Amendment,” and together with the Share Exchange Agreement, the “Amended Share Exchange Agreement”), as further amended by the second amendment to the Share Exchange Agreement, dated January 28, 2020 by and among JFK, Singapore NewCo, BVI NewCo, the Sellers, Diginex and the Representative (the “Second Amendment,” and together with the Amended Share Exchange Agreement, the “Second Amended Share Exchange Agreement”), and as further amended by the third amendment to the Share Exchange Agreement, dated May 6, 2020 by and among JFK, Singapore NewCo, BVI NewCo, the Sellers, Diginex and the Representative (the “Third Amendment,” and together with the Second Amended Share Exchange Agreement, the “Third Amended Share Exchange Agreement”). The words “expect,” “believe,” “estimate,” “intend,” “plan,” and similar expressions indicate forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to various risks and uncertainties, assumptions (including assumptions about general economic, market, industry and operational factors), known or unknown, which could cause the actual results to vary materially from those indicated or anticipated.
Such risks and uncertainties include, but are not limited to: (i) risks related to the expected timing and likelihood of completion of the Business Combination, including the risk that the Business Combination may not close due to one or more closing conditions to the Business Combination not being satisfied or waived on a timely basis or otherwise; (ii) the occurrence of any event, change or other circumstances that could give rise to the termination of the Third Amended Share Exchange Agreement; (iii) the risk that there may be a material adverse effect on the business, properties, assets, liabilities, results of operations or condition (financial or otherwise), of Diginex or its subsidiaries, taken as a whole; (iv) risks related to disruption of management time from ongoing business operations due to the proposed Business Combination; (v) the risk that any announcements relating to the proposed Business Combination could have adverse effects on the market price of JFK’s ordinary shares; (vi) risks related to the recent outbreak of the novel coronavirus (COVID-19) and its effects on the Business Combination; and (vii) other risks and uncertainties indicated from time to time in the Form F-4, including “Risk Factors” therein, and other factors identified in JFK’s and Singapore NewCo’s prior and future filings with the SEC, available at www.sec.gov.
Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements relate only to the date they were made, and JFK, Singapore NewCo, Diginex, and their respective subsidiaries undertake no obligation to update forward-looking statements to reflect events or circumstances after the date they were made except as required by law or applicable regulation.
Item 1.01. Entry Into a Material Definitive Agreement
On July 9, 2019, 8i Enterprises Acquisition Corp. (“JFK”) filed a Current Report on Form 8-K to announce the entry into a share exchange agreement (the “Share Exchange Agreement”) with Diginex Limited, a Hong Kong company (“Diginex”), the stockholders of Diginex (the “Sellers”) and Pelham Limited, a Hong Kong company, as representative of the Sellers (the “Representative”).
On October 8, 2019, each of the parties to the Share Exchange Agreement entered into an amendment and joinder to the Share Exchange Agreement (the “Amendment”) with Digital Innovative Limited, a Singapore public company limited by shares (“Singapore NewCo”), and its wholly-owned subsidiary DIGITAL INNOVATIVE LIMITED, a British Virgin Islands business company (“BVI NewCo”), for the purpose of joining both entities as parties to the Share Exchange Agreement and amending the terms of the Share Exchange Agreement.
On January 28, 2020, each of the parties to the Share Exchange Agreement and Amendment entered into a second amendment to the Share Exchange Agreement (the “Second Amendment”). The Share Exchange Agreement originally provided that Diginex may consummate a private placement of its ordinary shares of up to $25 million prior to the date the Business Combination is consummated (the “Closing Date”). The size of the private placement was increased to $30 million in the Amendment. The purpose of the Second Amendment is to increase the size of the private placement from $30 million to $50 million.
On May 6, 2020, each of the parties to the Second Amendment entered into a third amendment to the Share Exchange Agreement (the “Third Amendment,” and together with the Share Exchange Agreement, the Amendment and the Second Amendment, the “Amended Share Exchange Agreement”) to, among other things, (a) extend the outside closing date of the transactions contemplated by the Share Exchange Agreement (the “Share Exchange”) to June 23, 2020, (b) increase the number of ordinary shares of Singapore NewCo (“Singapore NewCo Ordinary Shares”) issuable to the Sellers in the Share Exchange from 20,000,000 to 25,000,000, (c) increase the number of shares the Sellers are entitled to receive if the closing price of the Singapore NewCo Ordinary Shares satisfy certain thresholds (the “Earnout Shares”) from an aggregate of 5,000,000 to 12,000,000, adjust closing price targets and to increase the milestone dates by which the Earnout Shares could be issued from three years to four years after the anniversary of the Closing Date; (d) increase the number of options to purchase Singapore NewCo Ordinary Shares received upon cancellation of the outstanding options to purchase ordinary shares under Diginex’s existing incentive plan from 4,200,000 to 5,600,000, and (e) allow JFK to issue up to 1,000,000 Singapore NewCo Ordinary Shares to third party advisors or consultants to (i) assist JFK with maintaining funds of at least $15,000,000 in the trust account after giving effect to all JFK ordinary share redemptions, but prior to taking into account JFK’s liabilities for any fees and costs relating to the transactions contemplated by the Amended Share Exchange Agreement, or (ii) provide market making services to Diginex after the Closing.
The Third Amendment includes new covenants of the parties prior to the Closing Date, such as (a) JFK shall convert all outstanding promissory notes issued in favor of 8i Enterprises Pte. Ltd. into JFK private units as of the Closing Date (the “Sponsor Loan Conversion”), (b) JFK shall use commercially reasonable efforts to cause Chardan Capital LLC (“Chardan”) to agree to convert, effective as of the Closing Date, deferred underwriting compensation in the amount of $1,725,000 owed to Chardan and any additional fees to be paid by JFK to Chardan upon the consummation of the Closing into Singapore NewCo Ordinary Shares at $10.00 per share, which shares will be subject to a lock-up agreement restricting any transfer thereof for a period of no less than six months after Closing, (c) Diginex will use commercially reasonable efforts to cause one of its service providers to enter into a lock-up agreement in connection with receipt of Singapore NewCo Ordinary Shares that such service provider will receive on the Closing Date for a period of no less than six months after the Closing Date, and (d) each of JFK and Diginex will use best efforts to assist the other party to fulfill the new covenants relating to (i) JFK maintaining $15,000,000 in the trust account as of the Closing Date after giving effect to JFK’s ordinary share redemptions, but prior to taking into account JFK’s liabilities for any fees and costs relating to the transactions contemplated by the Amended Share Exchange Agreement, and (ii) Diginex raising at least $15,000,000 through the issuance of new ordinary shares to be completed no later than the Closing (the “Subsequent Diginex Private Placement”). The failure to comply with the covenants described in clause (d) of this paragraph will not constitute a material breach of the Amended Share Exchange Agreement for the purposes of fulfilling certain closing conditions of parties, or with respect to the indemnification or termination provisions set forth in the Amended Share Exchange Agreement. In the event the respective covenants that are the subject matter of (d) of this paragraph are not fulfilled, or, (i) if the market value of the unrestricted publicly held JFK ordinary shares (as calculated under the rules of The Nasdaq Capital Market (“NASDAQ”)) that are outstanding as of immediately prior to the Closing Date (after giving effect to the JFK ordinary share redemptions), and (ii) the combined stockholders equity of JFK and Diginex (after giving effect to the JFK ordinary share redemptions, the Share Exchange and the transactions contemplated thereby), fail to satisfy NASDAQ listing requirements ((i) and (ii), collectively, the “Nasdaq Requirements”), the parties have agreed to negotiate in good faith to reach a mutually agreeable resolution with respect thereto. However, if they are unable to reach an agreement, such failure will not be a material breach on the part of any party that elects to terminate the Amended Share Exchange Agreement because the transactions contemplated thereunder did not occur prior to June 23, 2020, the outside closing date.
The Third Amendment includes new covenants of Diginex that (a) without JFK’s prior written consent (which consent will not be unreasonably withheld or delayed), Diginex and its affiliates will not, directly or indirectly, or through any other person (including, its directors, officers and agents) engage with or contact, for the purpose of making an investment into Diginex or any of its affiliates, any potential investor actually introduced to Diginex or its affiliates by JFK or its affiliates during the period commencing on April 27, 2020 and ending on the earlier of the Closing Date and termination of the Amended Share Exchange Agreement, and who have not previously (i) had any direct or indirect business or investment relationship with Diginex or its Affiliates or (ii) engaged in any discussions with or contacted or been contacted by, directly or indirectly, or through any other person (including, its directors, officers and agents), Diginex or the Diginex’s affiliates, advisors or representatives regarding a potential business or investment relationship, until the Closing Date, or in the event the Amended Shares Exchange Agreement is terminated, for a period of 12 months after the termination, and (b) without JFK’s prior written consent (which consent will not be unreasonably withheld, conditioned or delayed) Diginex will not use any proceeds of the Subsequent Diginex Private Placement, up to $15,000,000, for any purpose other than its operating expenses and capital expenditures.
The Third Amendment includes new covenants of all parties that, (a) JFK will use commercially reasonable efforts to cause one of its service providers to enter into a lock-up agreement in connection with receipt of Singapore NewCo Ordinary Shares that such service provider will receive for a period of no less than six months after the Closing Date, (b) JFK will use commercially reasonable efforts to cause the balance of the trust account after giving effect to JFK’s ordinary share redemptions, but prior to taking into account JFK’s liabilities for any fees and costs relating to the transactions contemplated by the Amended Share Exchange Agreement, to be an amount greater than or equal to $15,000,000, (c) prior to the Closing Date, Diginex will use its commercially reasonable efforts to raise at least $15,000,000 through the Subsequent Diginex Private Placement, and (d) JFK and Diginex will use commercially reasonable efforts to satisfy the Nasdaq Requirements.
The Third Amendment includes new conditions to the obligations of the parties to consummate the Share Exchange, such as (i) the balance of the trust account will be an amount greater than or equal to $15,000,000 after giving effect to JFK’s ordinary share redemptions, but prior to taking into account JFK’s liabilities for any fees and costs relating to the Share Exchange, and (ii) during the period commencing on April 24, 2020 and ending on the Closing Date, Diginex will raise at least $15,000,000 through the Subsequent Diginex Private Placement. As a new condition to Diginex’s obligation to consummate the Share Exchange, JFK will deliver to Diginex evidence of the Sponsor Loan Conversion. The existing condition to consummate the Share Exchange that JFK receives executed copies of lock-up agreements from all of the Diginex shareholders has been revised, so that in Diginex’s sole discretion up to 5,000,000 of the Singapore NewCo Ordinary Shares issued in the Subsequent Diginex Private Placement may be issued without being subject to the restrictions in the lock-up agreement.
The Third Amendment provides Diginex the right, at its sole option, to terminate the Amended Share Exchange Agreement if the Nasdaq Requirements are not met, or if after giving effect to the JFK ordinary share redemptions, the Share Exchange and the transactions contemplated thereby, JFK fails to comply with the net tangible assets requirements set forth in its Amended and Restated Memorandum and Articles of Association.
The foregoing description of the Third Amendment does not purport to be complete and is qualified in its entirety by the terms and conditions of the Third Amendment, a copy of which is filed as Exhibit 2.1 hereto and is incorporated by reference herein.
Item 7.01. Regulation FD Disclosure
On May 7, 2020, JFK issued a press release announcing the third amendment to the Share Exchange Agreement, which includes, among other things, extending the date by which JFK must complete its business combination to June 23, 2020 and new covenants and closing conditions of the parties. A copy of the press release is attached hereto Exhibit 99.1.
Beginning May 7, 2020, Diginex intends to use the presentation attached hereto as Exhibit 99.2 in meetings with investors.
The foregoing information, including the press release and the presentation attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, are being furnished pursuant to Item 7.01 of this Current Report and shall not be deemed “filed” for the purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits:
| Exhibit No. | Description | |
| 2.1 | Third Amendment to the Share Exchange Agreement dated as of May 6, 2020 | |
| 99.1 | JFK Press Release, dated as of May 7, 2020 | |
99.2 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: May 7, 2020
| 8i ENTERPRISES ACQUISITION CORP. | ||
| By: | /s/ James Tan | |
| Name: | James Tan | |
| Title: | Chief Executive Officer | |
Exhibit 2.1
THIRD AMENDMENT TO
SHARE EXCHANGE AGREEMENT
This THIRD AMENDMENT TO SHARE EXCHANGE AGREEMENT (the “Third Amendment”), dated as of May 6, 2020, by and among Diginex Ltd., a Hong Kong company (the “Company”), the stockholders of the Company (each, a “Stockholder” and collectively the “Stockholders”), Pelham Limited, a Hong Kong company, as the representative of the Stockholders (the “Stockholders’ Representative”), Diginex Limited, a Singapore public company limited by shares (“Singapore NewCo”) (f/k/a Digital Innovative Limited), DIGITAL INNOVATIVE LIMITED, a British Virgin Islands business company (“BVI NewCo”), and 8i Enterprises Acquisition Corp, a British Virgin Islands business company (the “Purchaser”, and collectively the “Parties”).
W I T N E S S E T H :
| A. | The Company, the Stockholders, the Stockholders’ Representative and the Purchaser entered into that certain Share Exchange Agreement, dated as of July 9, 2019 (as amended by the Amendment and Joinder and Second Amendment (each defined below), the “Share Exchange Agreement”). |
| B. | The Company, the Stockholders, the Stockholders’ Representative, Singapore NewCo, BVI NewCo, and the Purchaser entered into that certain Amendment and Joinder to the Share Exchange Agreement, dated October 8, 2019 (the “Amendment and Joinder”). |
| C. | The Company, the Stockholders, the Stockholders’ Representative, Singapore NewCo, BVI NewCo, and the Purchaser entered into that certain Second Amendment to the Share Exchange Agreement, dated January 28, 2020 (the “Second Amendment”). |
| D. | The Parties desire to make certain additional amendments to the Share Exchange Agreement as set forth in this Third Amendment. |
The Parties accordingly agree as follows:
1. Definitions. Capitalized terms used herein and not otherwise defined herein shall have the meaning ascribed to them in the Share Exchange Agreement.
2. Amendments.
a. Amendment to Definitions. The following definition contained in Article I of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
1.20 “Closing Payment Shares” means stock certificates representing, in the aggregate, 25,000,000 shares of Singapore NewCo Ordinary Shares issuable to the Stockholders and in such amounts set forth opposite each Stockholder’s name of Exhibit A.
b. New Definitions. ARTICLE I of the Share Exchange Agreement is hereby amended by adding the following definitions as new sections:
1.126 “8i Notes” has the meaning set forth in Section 6.16.
1.127 “Sponsor Loan Conversion” has the meaning set forth in Section 6.16.
1.128 “Subsequent Company Private Placement” means the issuance of new ordinary shares in the Company to be completed no later than the Closing Date, which issuance shall be separate from and in addition to the Company Private Placement.
1.129 “Chardan” has the meaning set forth in Section 6.17.
1.130 “Prospective Investor” has the meaning set forth in Section 7.3.
1.131 “Purchaser Private Units” means a unit of the Purchaser comprised of (a) one Purchaser Ordinary Share, (b) one Purchaser Private Warrant, and (c) one Purchaser Right.
c. Stock Option Conversion. Section 2.2 of the Share Exchange Agreement is hereby amended so that each reference to “4,200,000” therein shall be replaced with “5,600,000”.
d. Consideration. The last sentence of Section 3.1(a) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
Exhibit A shall be updated between the date hereof and the Closing to (x) reflect permitted transfers of Company Common Stock between the date hereof and the Closing and the issuance of new ordinary shares in the Company pursuant to the Company Private Placement and the Subsequent Company Private Placement and (y) reflect the number of Closing Payment Shares as set forth in Section 1.20.
e. Earnout Payment. Section 3.2(a) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“(a) In the event the closing price of the Singapore NewCo Ordinary Shares on Nasdaq (or other applicable securities exchange) is equal to or greater than the stock prices set forth below during any five trading days out of any 30 trading day period from and after the Closing until the applicable milestone date set forth below, the Stockholders shall be entitled to receive, and Singapore NewCo shall immediately cause to be delivered, as additional consideration for the Share Exchange (and without the need for additional consideration from the Stockholders), the aggregate number of additional Singapore NewCo Ordinary Shares set forth in the table below on a pro-rata basis based on their ownership percentages in the Company as set forth on Exhibit A, which shares shall be fully paid and free and clear of all Liens other than applicable securities Law restrictions:
| Milestone Date | Stock Price | Additional Singapore NewCo Ordinary Shares | ||||||
| 1-year anniversary of the Closing Date | $ | 15.00 | 3,000,000 | |||||
| 2-year anniversary of the Closing Date | $ | 20.00 | 3,000,000 | |||||
| 3-year anniversary of the Closing Date | $ | 25.00 | 3,000,000 | |||||
| 4-year anniversary of the Closing Date | $ | 30.00 | 3,000,000 | |||||
All share and per share amounts in the table above shall be proportionally adjusted for share splits, dividends, and similar events.”
f. Capitalization. The last sentence of Section 4.5 of the Share Exchange Agreement is hereby amended to insert “, the Subsequent Company Private Placement” immediately following the reference to “Company Private Placement”.
g. Covenants of the Parties Prior to Closing.
i. Section 6.1(a)(iv) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“make any capital expenditures, other than from funds received in the Subsequent Company Private Placement, in excess of (A) $1,000,000 per month in the aggregate, solely related to the Exchange and Custody platform as set forth in the Company’s financial projections provided to Purchaser (the “Company Platform”), and (B) $500,000 (individually or in the aggregate) outside of the Company Platform;”
ii. Section 6.1(a)(xvii) of the Share Exchange Agreement is hereby amended to insert “or the Subsequent Company Private Placement” immediately following the reference to “Company Private Placement”.
iii. Article VI of the Share Exchange Agreement is hereby amended by adding the following as a new Section 6.16 through Section 6.20:
“6.16 Promissory Note Conversion. The Purchaser shall convert all amounts outstanding under those certain promissory notes issued by the Purchaser from time to time (collectively, the “8i Notes”) in favor of 8i Enterprises Pte. Ltd. into Purchaser Private Units pursuant to the terms of the respective 8i Note, with such conversion to be effective as of the Closing (the “Sponsor Loan Conversion”).
6.17 Conversion of Deferred Underwriting Compensation. The Purchaser shall use its commercially reasonable efforts to cause Chardan Capital, LLC (“Chardan”) to agree to convert, effective as of the Closing Date, deferred underwriting compensation in the amount of $1,725,000 owed to Chardan and any additional fees to be paid by the Purchaser to Chardan upon the consummation of the Closing pursuant to that certain SPAC Financial and M&A Advisory Letter Agreement between the Purchaser and Chardan, dated April 8, 2019, into Singapore NewCo Ordinary Shares at $10.00 per share, which shares shall be subject to a Lock-Up Agreement restricting any transfer thereof for a period of no less than six months after the Closing.
6.18 Transfer Restrictions on Service Provider Shares. The Company shall use its commercially reasonable efforts to cause the Person listed in the third row of the table on Schedule 6.11 to enter into a Lock Up Agreement with respect to the Singapore NewCo Ordinary Shares that such Person shall receive pursuant to Section 6.11 restricting any transfer thereof for a period of no less than six months after the Closing.
6.19 Equity Raise Condition. Each of the Purchaser and the Company shall use best efforts to assist the other party in its efforts to fulfill such other party’s obligations set forth in Section 8.6 and Section 8.7; provided, however, that any failure to comply with Section 6.19, Section 8.6 or Section 8.7 shall not constitute a breach of this Agreement for the purposes of Section 9.2(a), Section 9.3(a), ARTICLE X or ARTICLE XII. If either the Company or the Purchaser, or both of them, are unable to fulfill their respective covenants under Section 8.6, Section 8.7 or Section 8.8 or satisfy the conditions set forth in Section 9.1(d) or Section 9.1(j), then the Company and the Purchaser shall negotiate in good faith with respect to the subject matter set forth in such sections. If the Company and the Purchaser are unable to reach a mutually agreeable resolution despite such negotiations with respect to the subject matter set forth in Section 8.6, Section 8.7, Section 8.8, Section 9.1(d) or Section 9.1(j), then such failure shall not be a material breach of this Agreement for the purposes of Section 12.1(b) on the part of the party terminating this Agreement.”
h. Covenants of the Company. Article VII of the Share Exchange Agreement is hereby amended by adding the following as a new Section 7.3 and Section 7.4:
“7.3 Non-Circumvention. The Purchaser and its Affiliates have professional relationships with certain parties that may be potential investors for the Company and/or the Company’s Affiliates which the Purchaser or its Affiliates actually introduce to the Company and/or the Company’s Affiliates during the period commencing from April 27, 2020 and ending on the earlier of (a) the Closing and (b) the termination of this Agreement, and who have not previously (i) had any direct or indirect business or investment relationship with the Company or the Company’s Affiliates or (ii) engaged in any discussions with or contacted or been contacted by, directly or indirectly, or through any other Person (including, its directors, officers and agents), the Company or the Company’s Affiliates, advisors or representatives regarding a potential business or investment relationship (each a “Prospective Investor”). Without the Purchaser’s prior written consent (which consent shall not be unreasonably withheld or delayed), the Company and the Company’s Affiliates agree that other than through or with the participation of the Purchaser or the Purchaser’s Affiliates, they shall not, directly or indirectly, or through any other person (including, its directors, officers and agents), engage with or contact for the purpose of making an investment into the Company or a Company Affiliate any Prospective Investor commencing on April 27, 2020 until the Closing of the transactions contemplated hereunder or, in the event this Agreement is terminated pursuant to Article XII hereunder, for a period of twelve (12) months after such termination.
7.4 Subsequent Company Private Placement. Without the prior written consent of the Purchaser, which shall not be unreasonably withheld, conditioned or delayed, the Company shall not use any proceeds of the Subsequent Company Private Placement for any purpose other than the Company’s operating expenses and capital expenditures; provided, however, that this Section 7.4 shall not apply to any amounts raised in the Subsequent Company Private Placement in excess of $15,000,000.”
i. Covenants of all Parties to the Agreement. Article VIII of the Share Exchange Agreement is hereby amended by adding the following as new Section 8.5 through Section 8.8:
“8.5 Transfer Restrictions on Service Provider Shares. The Purchaser shall use its commercially reasonable efforts to cause the Person listed in the second row of the table on Schedule 6.11 to enter into a Lock Up Agreement with respect to the Singapore NewCo Ordinary Shares that such Person shall receive pursuant to Section 6.11 restricting any transfer thereof for a period of no less than six months after the Closing.
8.6 Trust Account Balance. The Purchaser shall use its commercially reasonable efforts to cause the balance of the Trust Account (after giving effect to the Purchaser Stock Redemptions, but prior to taking into account its liabilities for any fees and costs relating to the transactions contemplated by this Agreement) to be an amount greater than or equal to $15,000,000.
8.7 Subsequent Company Private Placement. During the period commencing on April 24, 2020, and ending on the Closing Date, the Company shall use its commercially reasonable efforts to raise at least $15,000,000 through the Subsequent Company Private Placement.
8.8 Compliance with NASDAQ Requirements. The Purchaser and the Company shall use their respective commercially reasonable efforts to cause (a) the market value of the unrestricted publicly held Purchaser Ordinary Shares (as calculated under NASDAQ rules) that are outstanding as of immediately prior to the Closing (after giving effect to the Purchaser Stock Redemptions) and (b) the combined stockholders equity of the Company and the Purchaser (after giving effect to the Purchaser Stock Redemptions and the Share Exchange and the transactions contemplated thereby) to satisfy NASDAQ listing requirements.”
j. Conditions to the Obligations of the Parties.
i. Section 9.1(d) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“(d) After giving effect to the Purchaser Stock Redemptions, the balance of the Trust Account (prior to taking into account the Purchaser’s liabilities for any fees and costs relating to the transactions contemplated by this Agreement) shall be an amount greater than or equal to $15,000,000.”
ii. Section 9.1 of the Share Exchange Agreement is hereby amended by adding the following as new subsection (j):
“(j) During the period commencing on April 24, 2020, and ending on the Closing Date, the Company shall have raised at least $15,000,000 through the Subsequent Company Private Placement.”
k. Conditions to Obligations of the Purchaser. The first sentence of Section 9.2(g) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“The Purchaser shall have received executed copies of lock-up agreements (the “Lock-Up Agreements”) in a form and substance reasonably acceptable to the parties hereto signed by each of the Stockholders, which Lock-Up Agreements shall, at the Company’s sole discretion, not place any restrictions on up to 5,000,000 Singapore NewCo Ordinary Shares issued in the Subsequent Company Private Placement. The Lock-Up Agreements shall contain transfer restrictions and exceptions substantially similar to those contained in the Stock Escrow Agreement, dated as of March 27, 2019, by and among the Purchaser, the initial shareholders of the Purchaser listed on Exhibit A attached thereto and VStock Transfer, LLC, except that transfers shall also be permitted to strategic investors approved by Singapore NewCo’s board of directors.”
l. Conditions to Obligations of the Company. Section 9.3 of the Share Exchange Agreement is hereby amended by adding the following as a new subsection (h):
“(h) The Purchaser shall deliver to the Company evidence of Sponsor Loan Conversion.”
m. Termination without Default. Section 12.1(b) of the Share Exchange Agreement is hereby amended so that the “Outside Closing Date” shall be June 23, 2020.
n. Termination without Default. Section 12.1(e) of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“(e) The Company shall have the right, at its sole option, to terminate this Agreement by written notice to the Purchaser, if (i) the market value of unrestricted publicly held Purchaser Ordinary Shares (as calculated under NASDAQ listing rules) outstanding as of immediately prior to the Closing (after giving effect to the Purchaser Stock Redemptions) is less than $15,000,000, (ii) the combined stockholders equity of the Company and the Purchaser (after giving effect to the Purchaser Stock Redemptions and the Share Exchange and the transactions contemplated thereby) is less than $4,000,000, or (iii) the Purchaser, after giving effect to the Purchaser Stock Redemptions, the Share Exchange and the transactions contemplated hereby, fails to comply with the net tangible assets requirements set forth in the Purchaser Memorandum and Articles of Association.”
o. Expenses. Section 13.5 of the Share Exchange Agreement is hereby deleted in its entirety and the following is inserted in its place:
“13.5 Expenses. The costs and expenses of the Purchaser, Singapore NewCo, BVI NewCo and the Company (including the Hong Kong stamping fee) in connection with this Agreement and the transactions contemplated hereby shall be paid by Singapore NewCo after the Closing. If the Closing does not take place and such failure to close is not the result of a default or breach by any party hereto, each party shall be solely responsible for its own costs and expenses, except that (a) the Purchaser shall pay the Company’s professional fees and expenses of UHY LLP and Albeck Financial Services (and their respective Affiliates) that were incurred in connection with the completion of the Company’s audit of its financial statements for the periods ended March 31, 2019 and 2018 and review of its financial statements for the period ended June 30, 2019, other than any professional fees and expenses incurred by the Company in connection with the aforementioned audit in accordance with IFRS that are in excess of what the cost of such audit would have been if conducted in accordance with U.S. GAAP, and (b) the Company shall pay Singapore NewCo’s and BVI NewCo’s reasonable fees and expenses. The Purchaser has no further obligations to pay for any additional fees and expenses incurred by the Company in connection with the preparation of any of its other financial statements. If the failure of the Closing to occur is the result of a breach by the Company under Section 12.2(a), the Company shall reimburse the Purchaser for all of the Purchaser’s professional fees, disbursements and other costs and expenses incurred in connection with this Agreement. If the failure of the Closing to occur is the result of a breach by the Purchaser under Section 12.2(b), the Purchaser shall reimburse the Company for all of the Company’s professional fees, disbursements and other costs and expenses incurred in connection with this Agreement, which shall include such fees of Singapore NewCo and BVI NewCo.”
p. Schedules.
i. Schedule 4.13(c) to the Share Exchange Agreement is hereby amended to insert “and the Subsequent Company Private Placement” at the end of the description in Item (c).
ii. Schedule 4.28 to the Share Exchange Agreement is hereby amended to incorporate by reference the Singapore NewCo Ordinary Shares issuable pursuant to Section 4 of this Third Amendment.
3. Limited Waiver. The Purchaser acknowledges and agrees that, prior to the Closing Date, Pelham Limited (in its capacity as a Stockholder, “Pelham”), or a successor to Pelham’s shares in the Company, provided that such successor is controlled by Miles Pelham or in a substantially similar manner as Pelham (the “Grantor”) desires to enter into one or more call option agreements whereby the Grantor will grant certain persons a call option on shares of the Company Common Stock held by the Grantor (each, an “Option Grant”), consistent with past practice. In connection therewith, the Purchaser hereby waives any claims that an Option Grant, the issuance of the related call options pursuant to such Option Grant or the transfer of any shares of Company Common Stock pursuant to an Option Grant constitutes a breach of the representations, warranties and covenants set forth in the Share Exchange Agreement (as further amended by this Third Amendment). The Company shall cause Pelham to require that each person acquiring an Option Grant will agree to comply with the terms of the Share Exchange Agreement (as further amended by this Third Amendment) in the event that such person acquires Company Common Stock as a result of the exercise of the call option granted to such person in the Option Grant prior to the Closing.
4. Third Party Service Providers. The Purchaser may engage third party advisors or consultants (a) to assist it with its efforts to satisfy the covenant in Section 8.6 of the Share Exchange Agreement and the condition set forth in Section 9.1(d) of the Share Exchange Agreement or (b) to provide market making services to the Company after the Closing. Schedule 4.28 to the Agreement shall be updated to include the issuance of up to an aggregate of 1,000,000 Singapore NewCo Ordinary Shares as compensation (in lieu of cash) for services to be provided by such third party advisors or consultants.
5. No Other Amendments. Except for the amendments expressly set forth in this Third Amendment, the Share Exchange Agreement shall remain unchanged and in full force and effect.
6. Entire Agreement. The Share Exchange Agreement (as amended by this Third Amendment), together with the Additional Agreements, sets forth the entire agreement of the Parties with respect to the subject matter hereof and thereof, and there are no restrictions, promises, representations, warranties, covenants or undertakings with respect to the subject matter hereof or thereof, other than those expressly set forth in the Share Exchange Agreement (as amended by this Third Amendment) or the Additional Agreements. The Share Exchange Agreement (as amended by this Third Amendment) supersedes all prior and contemporaneous understandings and agreements related thereto (whether written or oral), all of which are merged herein; provided, however, that the Parties acknowledge that the Section entitled “No Trading” in that certain Summary of Non-Binding Terms between the Company and Singapore NewCo (as amended) shall remain in full force and effect.
7. Governing Law. This Third Amendment shall be construed in accordance with and governed by the laws of the State of Delaware, without giving effect to the conflict of laws principles thereof.
8. Severability. A determination by a court or other legal authority of competent jurisdiction that any provision of this Third Amendment is legally invalid shall not affect the validity or enforceability of any other provision hereof. The Parties shall cooperate in good faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance to such invalid provision as is lawful.
9. Counterparts; Facsimile Signatures. This Third Amendment may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement. This Third Amendment shall become effective upon delivery to each Party an executed counterpart or the earlier delivery to each Party an original, photocopied, or electronically transmitted signature pages that together (but need not individually) bear the signatures of all other parties.
10. Captions. Captions are not a part of this Third Amendment, but are included for convenience, only.
11. Further Assurances. Each Party shall execute and deliver such documents and take such action, as may reasonably be considered within the scope of such party’s obligations hereunder, necessary to effectuate the transactions contemplated by this Third Amendment.
[Signature page follows.]
IN WITNESS WHEREOF, the Parties have caused this Third Amendment to be duly executed as of the day and year first above written.
| Purchaser: | ||
| 8i Enterprises Acquisition Corp | ||
| By: | /s/ James Tan | |
| Name: | James Tan | |
| Title: | CEO | |
| Company: | ||
| Diginex Ltd. | ||
| By: | /s/ Miles Pelham | |
| Name: | Miles Pelham | |
| Title: | Chairman | |
| Stockholders’ Representative: | ||
| Pelham Limited | ||
| By: | /s/ Miles Pelham | |
| Name: | Miles Pelham | |
| Stockholders: | ||
| /s/ Miles Pelham | ||
| Name: | Miles Pelham | |
| Singapore NewCo: | ||
| Diginex Limited | ||
| By: | /s/ Paul Ewing | |
| Name: | Paul Ewing | |
| Title: | Director | |
| BVI NewCo: | ||
| DIGITAL INNOVATIVE LIMITED | ||
| By: | /s/ Miles Pelham | |
| Name: | Miles Pelham | |
| Title: | Director | |
[Signature page to Third Amendment to Share Exchange Agreement]
Exhibit 99.1
8i Enterprises Acquisition Corp. Announces Amendment to Agreement with Diginex Limited for Business Combination
NEW YORK, May 7, 2020 (GLOBE NEWSWIRE) -- 8i Enterprises Acquisition Corp. (NASDAQ: JFKKU, JFK, JFKKW, JFKKR) (“JFK” or the “Company”), a special purpose acquisition company, today announced that it has amended the Share Exchange Agreement (“Amendment”) with Diginex Limited (“Diginex” or the “Company”), a blockchain financial services and technology company, to extend the date by which it much complete its business combination to June 23, 2020 and to include new covenants and closing conditions of the parties.
JFK has called a special shareholder meeting for June 15, 2020 to vote on the business combination along with the other proposals. All parties remain committed to the business combination, which if consummated, will result in Diginex becoming the first company listed on Nasdaq with a digital asset exchange.
The Amendment, among other things, increases (i) the number of shares issuable to the Diginex shareholders at the closing of the business combination from 20,000,000 to 25,000,000, (ii) the number of earnout shares the Diginex shareholders would be entitled to receive upon the attainment of certain stock price targets from an aggregate of 5,000,000 over the three-year period after the closing of the business combination to 12,000,000 over the four-year period after the closing of the business combination, and (iii) from 4,200,000 to 5,600,000 the number of options to purchase ordinary shares of the combined company that will be issued in exchange for the currently outstanding options to purchase ordinary shares of Diginex.
The parties have also agreed, among other things, that Diginex will use commercially reasonable efforts to raise gross proceeds of $15,000,000 of additional capital through a private placement prior to the closing of the business combination and that it will be a closing condition that JFK will have at least $15,000,000 in its trust account after taking into account redemptions by JFK’s shareholders, but prior to taking into account JFK’s liabilities for any fee and costs related to the business combination.
Diginex continues to execute on its product roadmap, with the ongoing roll-out of various products including Helios, a warm custody solution for digital assets, in which further supports the company’s execution capability. Diginex’s institutionally focused digital asset exchange is anticipated to be available to the public in May 2020.
James Tan, Chairman and Chief Executive Officer of JFK, commented, “the need for institutional grade, regulated infrastructure in the digital asset and blockchain space remains strong. Diginex continues to be well-positioned to unlock opportunities and drive institutional adoption of blockchain technologies and digital assets.”
Richard Byworth, Chief Executive Officer of Diginex, said, “we are committed to providing institutional investors with the tools, technology and infrastructure required to drive increased adoption of digital assets, a trend in which we see tremendous growth opportunities, particularly as it relates to the disruption of the traditional financial services industry.”
About Diginex Limited
Diginex is a blockchain financial services and technology company. Diginex partners with institutional investors, corporations and governments to make digital assets more accessible, business processes more efficient and secure. Diginex believes its collaborative approach and pursuit of global cooperation is optimal to drive institutional adoption of blockchain technologies and the regulated use of digital assets. More information can be found at: https://www.diginex.com/. Follow Diginex on social media on Twitter @DiginexGlobal, on Facebook @DiginexGlobal, and on LinkedIn.
About 8i Enterprises Acquisition Corp.
8i Enterprises Acquisition Corp. is a British Virgin Islands company incorporated as a blank check company for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities. The Company's efforts to identify a prospective target business will not be limited to a particular industry or geographic region, although the Company intends to focus on targets located in Asia.
Disclaimer
This press release is not a proxy statement or a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed transaction. This press release shall also not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No registered offering of securities shall be made except by means of a prospectus meeting the requirements of section 10 of the Securities Act of 1933, as amended.
Forward Looking Statements
This press release includes forward looking statements that involve risks and uncertainties. Forward looking statements are statements that are not historical facts. Such forward-looking statements, including the identification of a target business and potential business combination or other such transaction, are subject to risks and uncertainties, which could cause actual results to differ from the forward- looking statements. These risks and uncertainties include, but are not limited to, those factors described in the section entitled “Risk Factors” in the prospectus filed by JFK in connection with its initial public offering on March 27, 2019. Important factors, among others, that may affect actual results or outcomes include: the inability to complete the proposed transaction; the inability to recognize the anticipated benefits of the proposed transaction, which may be affected by, among other things, the amount of cash available following any redemptions by JFK shareholders; the ability to meet Nasdaq’s listing standards following the consummation of the proposed transaction; and costs related to the proposed transaction. Important factors that could cause the combined company’s actual results or outcomes to differ materially from those discussed in the forward-looking statements include: The impact of the outbreak of the novel coronavirus (COVID-19), Diginex’s limited operating history and history of net losses; Diginex’s ability to manage growth; Diginex’s ability to execute its business plan; Diginex’s estimates of the size of the markets for its products; the rate and degree of market acceptance of Diginex’s products; Diginex’s ability to identify and integrate acquisitions; potential litigation involving the Company or Diginex or the validity or enforceability of Diginex’s intellectual property; general economic and market conditions impacting demand for Diginex’s products and services; and such other risks and uncertainties as are discussed in the Company’s prospectus filed in connection with its initial public offering and the proxy statement to be filed relating to the business combination. Other factors include the possibility that the proposed business combination does not close, including due to the failure to receive required security holder approvals, or the failure of other closing conditions. The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with respect thereto or any change in events, conditions or circumstances on which any statement is based.
Contacts
For inquiries regarding 8i Enterprises Acquisition Corp.:
William Yap, CFA
Chief Financial Officer
Email: ir@8icorp.com
Phone: +65 6788-0388
or
Investor Relations:
Tony
Tian, CFA
Weitian Group LLC
Email: ttian@weitianco.com
Phone: +1 732-910-9692
For inquiries regarding Diginex:
Heather Dale
Chief Marketing Officer
Email: heather.dale@diginex.com
Phone: +852 2248 0600
THIS PRESS RELEASE CONTAINS ONLY A BRIEF DESCRIPTION OF THE PROPOSED TRANSACTION. IT IS NOT A REQUEST FOR OR SOLICITATION OF A PROXY. IN CONNECTION WITH THE PROPOSED TRANSACTION, 8i ENTERPRISES ACQUISITION INTENDS TO FILE A PROXY STATEMENT ON SCHEDULE 14A AND OTHER RELEVANT MATERIALS WITH THE SECURITIES AND EXCHANGE COMMISSION, OR SEC. STOCKHOLDERS OF 8i ENTERPRISES ACQUISITION ARE URGED TO READ 8i ENTERPRISES ACQUISITION’S PROXY STATEMENT AND ALL OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE, AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. A DEFINITIVE PROXY STATEMENT WILL BE SENT TO 8i ENTERPRISES ACQUISITION’S STOCKHOLDERS SEEKING THEIR APPROVAL OF THE PROPOSED TRANSACTION. 8i ENTERPRISES ACQUISITION’S STOCKHOLDERS WILL BE ABLE TO OBTAIN THESE DOCUMENTS (WHEN AVAILABLE) FREE OF CHARGE AT THE SEC’S WEB SITE, HTTP://WWW.SEC.GOV. IN ADDITION, THEY MAY OBTAIN FREE COPIES OF THESE BY CONTACTING 8i ENTERPRISES ACQUISITION’S SECRETARY, AT 6 EU TONG SEN STREET, #08-13 THE CENTRAL, SINGAPORE 059817.
Exhibit 99.2