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SEQUANS COMMUNICATIONS S.A.
(Registrant)
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Date: October 30, 2018
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By:
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/s/ Deborah Choate
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Deborah Choate
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Chief Financial Officer
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Exhibit
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Description
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4.1
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Amendment No. 3, 2015 Note
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4.2
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Amendment No. 3, 2016 Note
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4.3
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2018 Note
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4.4
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Nokomis Warrant Agreement
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4.5
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Amendment No. 4, 2015 Note
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4.6
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Amendment No. 4, 2016 Note
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4.7
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Amendment No. 1, 2018 Note
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4.8
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Harbert Bond Issue Agreement with Annexes
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4.9
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Harbert Warrant Issue Agreement
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99.1
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Press release dated October 30, 2018
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1.
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Amendment to Note
.
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a.
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Section 3.1 of the Note is hereby amended and restated in its entirety as follows:
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b.
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Section 5.2 of the Note is hereby amended and restated in its entirety as follows:
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c.
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Article VI of the Note is hereby amended and restated in its entirety as follows:
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d.
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A new Article XII is hereby added to the Note as follows:
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2.
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Miscellaneous
.
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a.
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Governing Law
.
The validity, interpretation and performance of this Amendment shall be governed by and construed in accordance with the internal laws of The French Republic (without regard to principles of conflicts of law). The parties agree that the competent courts within the jurisdiction of the Paris Court of Appeal (
Cour d’Appel de Paris
) shall have exclusive jurisdiction (and are deemed to be a convenient forum for each party) as to resolution of any dispute.
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b.
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Continuing Effect
. Other than as set forth in this Amendment, all of the terms and conditions of the Note will continue in full force and effect.
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c.
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Amendment and Waiver
. No modification of or amendment to this Amendment, nor any waiver of any rights under this Amendment, shall be effective unless in writing signed by the Company and the Purchaser. No delay or failure to require performance of any provision of this Amendment shall constitute a waiver of that provision as to that or any other instance.
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d.
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Successors and Assigns
. The terms and conditions of this Amendment shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties.
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1.
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Amendments to Note
.
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a.
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Article VI of the Note is hereby amended and restated in its entirety as follows:
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b.
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A new Article XII is hereby added to the Note as follows:
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2.
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Miscellaneous
.
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a.
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Governing Law
.
The validity, interpretation and performance of this Amendment shall be governed by and construed in accordance with the internal laws of The French Republic (without regard to principles of conflicts of law). The parties agree that the competent courts within the jurisdiction of the Paris Court of Appeal (
Cour d’Appel de Paris
) shall have exclusive jurisdiction (and are deemed to be a convenient forum for each party) as to resolution of any dispute.
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b.
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Continuing Effect
. Other than as set forth in this Amendment, all of the terms and conditions of the Note will continue in full force and effect.
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c.
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Amendment and Waiver
. No modification of or amendment to this Amendment, nor any waiver of any rights under this Amendment, shall be effective unless in writing signed by the Company and the Purchaser. No delay or failure to require performance of any provision of this Amendment shall constitute a waiver of that provision as to that or any other instance.
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d.
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Successors and Assigns
. The terms and conditions of this Amendment shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties.
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ARTICLE I
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DEFINED TERMS
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ARTICLE II
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PAYMENT OF INTEREST
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ARTICLE III
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PAYMENT OF PRINCIPAL ON NOTE
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CR
1
= CR
0
×
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OS
1
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OS
0
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such dividend or distribution;
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CR
1
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=
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the Conversion Rate in effect on the ex-dividend date for such dividend or distribution;
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OS
0
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=
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the number of Ordinary Shares outstanding at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such dividend or distribution; and
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OS
1
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=
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the number of Ordinary Shares that would be outstanding immediately after, and solely as a result of, such dividend or distribution.
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CR
1
= CR
0
×
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OS
1
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OS
0
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the effective date of such subdivision or combination;
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CR
1
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=
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the Conversion Rate in effect on the effective date of such subdivision or combination;
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OS
0
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=
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the number of Ordinary Shares outstanding at 5:00 p.m., New York City time, on the trading day immediately preceding the effective date of such subdivision or combination; and
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OS
1
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=
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the number of Ordinary Shares that would be outstanding immediately after, and solely as a result of, such subdivision or combination.
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CR
1
= CR
0
×
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OS
0
+X
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OS
0
+Y
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such issuance;
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CR
1
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=
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the Conversion Rate in effect on the ex-dividend date for such issuance;
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OS
0
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=
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the number of Ordinary Shares outstanding at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such issuance;
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X
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=
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the total number of Ordinary Shares issuable (directly or in the form of ADSs) pursuant to such rights or warrants; and
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Y
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=
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the number of Ordinary Shares equal to the quotient of (x) aggregate price payable to exercise such rights or warrants, divided by (y) the average of the Closing Sale Prices of the ADSs during the ten (10) consecutive trading day period ending on the trading day immediately preceding the ex-dividend date for such issuance.
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CR
1
= CR
0
×
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SP
0
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SP
0
- FMV
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such distribution;
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CR
1
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=
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the Conversion Rate in effect on the ex-dividend date for such distribution;
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SP
0
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=
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the average of the Closing Sale Prices of the ADSs multiplied by the number of Ordinary Shares then represented by each ADS during the ten (10) consecutive trading day period ending on the trading day immediately preceding the ex-dividend date for such distribution; and
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FMV
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=
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the fair market value on the ex-dividend date for such distribution of the Distributed Assets so distributed applicable to one (1) Ordinary Share, as determined in good faith by the Board of Directors.
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CR
1
= CR
0
×
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FMV
0
+ MP
0
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MP
0
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such distribution;
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CR
1
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=
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the Conversion Rate in effect on the ex-dividend date for such distribution;
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FMV
0
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=
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the average of the Closing Sale Prices of the Distributed Assets applicable to one (1) Ordinary Share during the ten consecutive trading day period commencing on and including the effective date of the Spin-Off (the “
Spin-Off Valuation Period
”); and
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MP
0
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=
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the average of the Closing Sale Prices of the ADSs multiplied by the number of Ordinary Shares then represented by each ADS during the Spin-Off Valuation Period.
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CR
1
= CR
0
×
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SP
0
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SP
0
-
DIV
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the trading day immediately preceding the ex-dividend date for such dividend or distribution;
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CR
1
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=
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the Conversion Rate in effect on the ex-dividend date for such dividend or distribution;
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SP
0
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=
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the average of the Closing Sale Prices of the ADSs multiplied by the number of Ordinary Shares then represented by each ADS during the ten (10) consecutive trading day period ending on the trading day immediately preceding the ex-dividend date for such distribution; and
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DIV
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=
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the amount in cash per Ordinary Share the Company distributes to holders of its Ordinary Shares.
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CR
1
= CR
0
×
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FMV + (SP
1
x OS
1
)
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SP
1
x OS
0
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CR
0
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=
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the Conversion Rate in effect at 5:00 p.m., New York City time, on the Expiration Date;
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CR
1
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=
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the Conversion Rate in effect immediately after 5:00 p.m., New York City time, on the Expiration Date;
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FMV
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=
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the fair market value, on the Expiration Date, of the aggregate value of all cash and any other consideration paid or payable for Ordinary Shares (directly or indirectly in the form of ADSs) validly tendered or exchanged and not withdrawn as of the Expiration Date, as determined in good faith by the Board of Directors;
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OS
1
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=
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the number of Ordinary Shares outstanding immediately after the last time tenders or exchanges may be made pursuant to such tender offer or exchange offer (the “
Expiration Time
”), after giving effect to the purchase of all Ordinary Shares or ADSs, as the case may be, accepted for purchase or exchange in such tender or exchange offer;
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OS
0
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=
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the number of Ordinary Shares outstanding immediately before the Expiration Time; and
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SP
1
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=
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the average of the Closing Sale Prices of the ADSs multiplied by the number of Ordinary Shares then represented by each ADS during the ten (10) consecutive trading day period commencing on the trading day immediately after the Expiration Date.
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ARTICLE VII
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AMENDMENT AND WAIVER
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ARTICLE VIII
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CANCELLATION
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ARTICLE IX
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PAYMENTS
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ARTICLE X
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PLACE OF PAYMENT
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ARTICLE XI
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GOVERNING LAW
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(i)
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executes and returns to the Company the subscription form of the Warrants in the form attached as exhibit 1 hereto; and
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(ii)
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pays the Subscription Price in full, in cash or by way of set off against receivables in accordance with applicable French law, on or before October 8, 2018.
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1.
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permit any Warrant holder to exercise his Warrants immediately so that such holder may participate in the rights issue, which will not alter or limit the rights of the Beneficiary to exercise the Warrants under Section 2.1 of this Warrant Agreement
;
or
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2.
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take any measures which would allow the Beneficiary, should he decide to exercise the Warrants, to eventually be in the same position as other shareholders as if the Beneficiary were a shareholder at the time of such operations. Should the Beneficiary exercise its Warrants, the Company could thus allow the Beneficiary to subscribe a
pro rata
share of a new rights’ issue or be the beneficiary of free allocation of shares, or receive cash or goods under the same form, proportion, terms and conditions (except for use) as those set in favor of then existing shareholders when such operations occurred
;
or
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3.
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adjust the Warrants’ exercise price, conversion-into-shares ratio or other terms relating to subscription of the Company’s shares in order to take into account the new rights issue. In such case, any such adjustment shall be carried out in accordance with the method set forth in article R. 228-91 of French Commercial Code (Code de commerce), it being specified that the value of an existing shareholder’s right to participate, as well as the value of the share itself (including the right to participate in the rights issue), shall be determined by the board of directors of the Company. The board shall determine such value while taking into account, as the case may be, the subscription, exchange or sale price per share used during the last operation relating to the Company’s share capital (such as any share capital increase, contribution in kind, sale of shares,...) which occurred during a six (6)-month period immediately preceding such board of directors’ meeting. In the event no such operation occurred over such period, the board shall take into account any other financial parameter which it finds relevant (and which relevancy shall then be confirmed by the Company’s statutory auditor).
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/s/ Brett Hendrickson
______________________________________________________
For: NOKOMIS CAPITAL MASTER FUND, L.P.
By:
Brett HENDRICKSON
Title:
Portfolio Manager
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/s/ Georges Karam
_________________________________________________
For: SEQUANS COMMUNICATIONS
By:
Georges KARAM
Title:
Président-Directeur Général
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•
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that neither the Warrants nor the Warrant Shares have been, nor will be, registered under the U.S. Securities Act of 1933, as amended (the “
Securities Act
”) by reason of a specific exemption from the registration provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the representations below
;
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•
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that it is acquiring the Warrants for investment for its own account, not as a nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof, and that it has no present intention of selling, granting any participation in, or otherwise distributing the same
;
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•
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that it does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity or to any third person or entity with respect to any of the Warrants
;
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•
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that it is an institutional “accredited investor” as defined in Regulation D, Rule 501(a) under the Securities Act, has such knowledge and experience in financial and business matters so that it is capable of evaluating the merits and risks of its investment in Sequans Communications and it understands and acknowledges that an investment in Sequans Communications is highly speculative and involves substantial risks. It can bear the economic risk of its investment and is able, without impairing its financial condition, to hold the Warrants and the Warrant Shares for an indefinite period of time and to suffer a complete loss of its investment
;
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•
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that it has had an opportunity to ask questions of, and receive answers from, the officers of Sequans Communications concerning this Warrant Agreement, as well as its business, management and financial affairs, which questions were answered to its satisfaction
;
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•
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that it believes that it has received all the information it considers necessary or appropriate for deciding whether to receive Warrants. It acknowledges that any future plans and forward looking statements expressed by Sequans Communications are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the future plans and forward looking statements will not materialize or will vary significantly from actual results. It also acknowledges that it is relying solely on its own counsel and not on any statements or representations of Sequans Communications, or any agent or adviser of Sequans Communications for legal advice with respect to the subscription of the Warrants
;
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•
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that the Warrants are being acquired by it in reliance on a private placement exemption from the registration requirements of the Securities Act and the Warrant Shares are and will be “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act and that the exemption from registration provided under Rule 144 may not be available for resales by it of the Warrant Shares. Therefore, it further agrees that if it wishes to dispose of or exchange any of the Warrant Shares, it will not transfer any of the Warrant Shares, directly or indirectly, unless such transfer is a transaction that is deemed to occur outside of the United States under Regulation S under the Securities Act, or pursuant to an available exemption from, or in a transaction not subject to, the registration requirements, of the Securities Act. The Company may require, as a condition of allowing any transfer, that the holder or transferee of the Warrant Shares, as the case may be, provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Warrant Shares under the Securities Act
;
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•
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that neither the Warrants nor the Warrant Shares have been, nor will be, registered under the U.S. Securities Act of 1933, as amended (the “
Securities Act
”) by reason of a specific exemption from the registration provisions of the Securities Act and therefore the Warrants and the Warrant Shares are and will be “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act
;
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•
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that the exemption from registration provided under Rule 144 may not be available for resales by it of the Warrant Shares
;
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•
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therefore, it agrees that the Warrant Shares may only be transferred, directly or indirectly, in a transaction that is deemed to occur outside of the United States under Regulation S under the Securities Act, or pursuant to an available exemption from, or in a transaction not subject to, the registration requirements of the Securities Act
;
it agrees that the Company may require, as a condition of allowing any transfer, that the holder or transferee of the Warrant Shares, as the case may be, provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Warrant Shares under the Securities Act and that these restrictions have been noted in Sequans Communications’ share registry held by its registrar
;
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a)
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as long as, and only if, any Event of Default (as such term is defined in the Bond Issue Agreement) is outstanding or in case of an acceleration under the Bond Issue Agreement, the Company shall refrain from making any payment to the Purchaser and the Purchaser shall refrain from requesting or receiving, directly or indirectly, any payment from the Company;
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b)
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in the event that any payment by the Company or any person on behalf of the Company is made to the Purchaser in violation of the provisions of paragraph (a) above, the Purchaser undertakes to immediately transfer to Harbert the amounts received in violation of the provision of this Amendment;
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c)
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the Purchaser shall refrain from taking any of the following actions, unless prior written consent has been granted to the Purchaser by Harbert:
|
•
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to accelerate the maturity of the Note in any manner;
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•
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to initiate any legal procedure or legal action or legal arbitration procedure against the Company aiming at the repayment of any amount owed to it by the Company under the Note, or any other procedure whatsoever, including any conciliation procedure, receivership or liquidation; and
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•
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to accept any early repayment or declare that all or part of the amount owed under the Note becomes payable on demand, for any reason whatsoever before the Company has paid and repaid all the Harbert Indebtedness to Harbert.
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a.
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Governing Law
. The validity, interpretation and performance of this Amendment shall be governed by and construed in accordance with the internal laws of The French Republic (without regard to principles of conflicts of law). The parties agree that the competent courts within the jurisdiction of the Paris Court of Appeal (
Cour d’Appel de Paris
) shall have exclusive jurisdiction (and are deemed to be a convenient forum for each party) as to resolution of any dispute.
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b.
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Continuing Effect
. Other than as set forth in this Amendment, all of the terms and conditions of the Note will continue in full force and effect. This Amendment shall not be construed as a novation of any of the Note or the Purchase Agreement.
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c.
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Amendment and Waiver
. No modification of or amendment to this Amendment, nor any waiver of any rights under this Amendment, shall be effective unless in writing signed by the Company and the Purchaser. No delay or failure to require performance of any provision of this Amendment shall constitute a waiver of that provision as to that or any other instance.
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d.
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Successors and Assigns
. The terms and conditions of this Amendment shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties.
|
a)
|
as long as, and only if, any Event of Default (as such term is defined in the Bond Issue Agreement) is outstanding or in case of an acceleration under the Bond Issue Agreement, the Company shall refrain from making any payment to the Purchaser and the Purchaser shall refrain from requesting or receiving, directly or indirectly, any payment from the Company;
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b)
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in the event that any payment by the Company or any person on behalf of the Company is made to the Purchaser in violation of the provisions of paragraph (a) above, the Purchaser undertakes to immediately transfer to Harbert the amounts received in violation of the provision of this Amendment;
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c)
|
the Purchaser shall refrain from taking any of the following actions, unless prior written consent has been granted to the Purchaser by Harbert:
|
•
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to accelerate the maturity of the Note in any manner;
|
•
|
to initiate any legal procedure or legal action or legal arbitration procedure against the Company aiming at the repayment of any amount owed to it by the Company under the Note, or any other procedure whatsoever, including any conciliation procedure, receivership or liquidation; and
|
•
|
to accept any early repayment or declare that all or part of the amount owed under the Note becomes payable on demand, for any reason whatsoever before the Company has paid and repaid all the Harbert Indebtedness to Harbert.
|
a.
|
Governing Law
. The validity, interpretation and performance of this Amendment shall be governed by and construed in accordance with the internal laws of The French Republic (without regard to principles of conflicts of law). The parties agree that the competent courts within the jurisdiction of the Paris Court of Appeal (
Cour d’Appel de Paris
) shall have exclusive jurisdiction (and are deemed to be a convenient forum for each party) as to resolution of any dispute.
|
b.
|
Continuing Effect
. Other than as set forth in this Amendment, all of the terms and conditions
|
c.
|
Amendment and Waiver
. No modification of or amendment to this Amendment, nor any waiver of any rights under this Amendment, shall be effective unless in writing signed by the Company and the Purchaser. No delay or failure to require performance of any provision of this Amendment shall constitute a waiver of that provision as to that or any other instance.
|
d.
|
Successors and Assigns
. The terms and conditions of this Amendment shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties.
|
a)
|
as long as, and only if, any Event of Default (as such term is defined in the Bond Issue Agreement) is outstanding or in case of an acceleration under the Bond Issue Agreement, the Company shall refrain from making any payment to the Purchaser and the Purchaser shall refrain from requesting or receiving, directly or indirectly, any payment from the Company;
|
b)
|
in the event that any payment by the Company or any person on behalf of the Company is made to the Purchaser in violation of the provisions of paragraph (a) above, the Purchaser undertakes to immediately transfer to Harbert the amounts received in violation of the provision of this Amendment;
|
c)
|
the Purchaser shall refrain from taking any of the following actions, unless prior written consent has been granted to the Purchaser by Harbert:
|
•
|
to accelerate the maturity of the Note in any manner;
|
•
|
to initiate any legal procedure or legal action or legal arbitration procedure against the Company aiming at the repayment of any amount owed to it by the Company under the Note, or any other procedure whatsoever, including any conciliation procedure, receivership or liquidation; and
|
•
|
to accept any early repayment or declare that all or part of the amount owed under the Note becomes payable on demand, for any reason whatsoever before the Company has paid and repaid all the Harbert Indebtedness to Harbert.
|
a.
|
Governing Law
. The validity, interpretation and performance of this Amendment shall be governed by and construed in accordance with the internal laws of The French Republic (without regard to principles of conflicts of law). The parties agree that the competent courts within the jurisdiction of the Paris Court of Appeal (
Cour d’Appel de Paris
) shall have exclusive jurisdiction (and are deemed to be a convenient forum for each party) as to resolution of any dispute.
|
b.
|
Continuing Effect
. Other than as set forth in this Amendment, all of the terms and conditions of the Note will continue in full force and effect. This Amendment shall not be construed as a novation of any of the Note or the Purchase Agreement.
|
c.
|
Amendment and Waiver
. No modification of or amendment to this Amendment, nor any waiver of any rights under this Amendment, shall be effective unless in writing signed by the Company and the Purchaser. No delay or failure to require performance of any provision of this Amendment shall constitute a waiver of that provision as to that or any other instance.
|
d.
|
Successors and Assigns
. The terms and conditions of this Amendment shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties.
|
(1)
|
SEQUANS COMMUNICATIONS
,
a limited company (
société anonyme
), whose registered office is at 15-55, boulevard Charles de Gaulle Les Portes de la Défense - 92700 Colombes, registered with the Nanterre Registry under number 450 249 677,
hereinafter referred to as “
Sequans Communications
” or as
the “
Issuer
”.
|
(2)
|
HARBERT EUROPEAN SPECIALTY LENDING COMPANY II S.à r.l.
,
a company with a limited liability (
société à responsabilité limitée
) incorporated under the laws of Luxembourg whose registered office is at 5, rue Guillaume Kroll, L-1882 Luxembourg, hereinafter referred to as “
HESLC II
” or the “
Subscriber
” or the “
Noteholder
”, as the case may be;
|
1.
|
DEFINITIONS AND INTERPRETATIONS
|
1.1
|
In this Bond Issue Agreement (as hereinafter defined) unless the context otherwise specifically provides, the following expressions shall have the following meanings:
|
-
|
"
Accounts
"
means the certified consolidated Issuer’s financial statements (
comptes annuels
) for the relevant financial year, each consisting of a balance sheet (
bilan
) of the Issuer and a profit and loss account (
compte de résultat
) of the Issuer and the accounting exhibit (
annexe comptable
);
|
-
|
"
Agreement
"
means this Bond Issue Agreement entered into between Sequans Communications and HESLC II on the date hereof;
|
–
|
"
Amortization Date
" means the last Business Day of each calendar month, starting after a period of twelve (12) months following the Closing Date and during which such twelve (12) month period only Interest Payments shall be due.
|
-
|
"
Availability Period
" means the period of five (5) days starting from the date of execution of this Agreement.
|
-
|
"
Business Day
"
means a day (other than a Saturday or Sunday) on which the banks are open for business in Paris and in London, and which is also a TARGET Day;
|
-
|
"
Charged Property
" means the whole or any part of the property, assets, and undertaking of the Issuer from time to time mortgaged, charged or assigned to the Noteholder pursuant to the Security Documents;
|
-
|
"
Closing Date
" means the date on which the Notes are issued and subscribed;
|
-
|
"
Condition Precedent Documents
" means the documents to be supplied to the Subscriber as a condition precedent to the subscription of the Notes, such as these documents are identified under
Annex 1
;
|
-
|
"
Event of Default
" means any of those events set out in Article 10 (
Events of Default
);
|
-
|
"
First Ranking Bank Accounts Pledge Agreement
" means the first ranking bank account pledge agreement to be entered into on or about the date hereof between, the Issuer, as pledgor, and the Subscriber, as beneficiary;
|
-
|
"
HESLC II Group
" means HESLC II and any of its nominees, all or any subsidiary or holding companies for the time being or in the future of HESLC II, any subsidiary of any such holding company as aforesaid, together with, if appropriate, all or any general partners, limited partners, carried interest partners, investment trusts or investment companies of funds of or managed by HESLC II or by any holding or subsidiary company of HESLC II from time to time and any nominee of any of the foregoing;
|
-
|
"
Indebtedness
" means any obligation of any person from time to time (present or future, actual or contingent, as principal or surety or otherwise) for the payment or repayment of money including, but not limited to:
|
(a)
|
under acceptances, bills, bonds, debentures, notes or similar instruments;
|
(b)
|
under guarantees, indemnities or other assurances against financial loss;
|
(c)
|
in respect of the purchase, hire or lease of any asset or services under an arrangement treated as a finance lease under Financial Reporting Standards (or IFRS); and
|
(d)
|
indebtedness of other persons secured by or benefiting from any Security Interests on the property of that person;
|
-
|
Intellectual Property
" means all subsisting intellectual property rights owned presently or in the future by the Issuer in any part of the world including patents and rights of a similar nature, divisions, prolongations, renewals, extensions, supplementary protection certificates and continuations of such applications for patents, registered and unregistered trademarks, registered and unregistered designs, utility models (in each case for their full period and all extensions and renewals of them), applications for any of them and the right to apply for any of them in any part of the world, inventions, processes, software, formulae, technology (whether patentable or not), drawings, trade secrets, know-how, brand names, domain names, database rights, copyright and rights in the nature of database rights and copyright, design rights, get-up and any uniform resource identifier and any similar rights existing in any country and all legal equitable and other rights in any of them owned by the Issuer; and the benefit (subject to the burden) of any and all agreements, arrangements and licences (where such agreements and licences permit the creation of security without prior consent) in connection with any of the foregoing;
|
-
|
"
Interest Payment
"
means interest payments due by the Issuer to the Noteholder pursuant to this Agreement, on any and all Interest Payment Dates and on the Redemption Date, in accordance with the payment schedule as referred to in
Annex 2
;
|
-
|
"
Interest Payment Date
"
means the last Business Day of each calendar month;
|
-
|
"
Interest Period
" means a period commencing on and including an Interest Payment Date and ending on but excluding the next following Interest Payment Date. Every Interest Period shall have a duration of one month except that:
|
•
|
the initial Interest Period in respect of the Notes will commence on the Closing Date and end on the next following Interest Payment Date; and
|
•
|
if any Interest Period would otherwise overrun any Interest Payment Date, such Interest Period shall end on such Interest Payment Date;
|
-
|
"
Issue Documents
" means this Agreement, each of the Security Documents and any document designated as an "Issue Document" by the Issuer and the Subscriber;
|
-
|
"
Issue
"
means
the bond issue carried out pursuant to this Agreement;
|
-
|
"
Issuer
"
means Sequans Communications as further described in the recitals of this Agreement;
|
-
|
"
Issuer’s Group
" means Sequans Communications and its subsidiaries for the time being;
|
-
|
"
Material Adverse Effect
" means a material adverse effect of an event which is materially adverse to:
|
(a)
|
the financial condition of the Issuer;
|
(b)
|
the business/operations of the Issuer; and
|
(c)
|
the ability to comply with any of its obligations under any of the Issue Documents;
|
-
|
"
Natixis Factoring Programme
" means the factoring programme entered into by the Issuer with
Natixis Factor pursuant to the terms of the agreement entitled “
Contrat Global Export n°71958
” dated 5 June 2014, as such agreement has been amended by two amendment agreements dated 12 October 2016 and 10 July 2017 and as such agreement may be further amended, restated or supplemented from time to time;
|
-
|
"
Non-Cooperative Jurisdiction
" means a "non-cooperative state or territory" (
Etat ou territoire
non cooperatif
) as set out in the list referred to in Article 238-0-A of the French tax Code (
Code général des impôts
), as such list may be amended from time to time;
|
-
|
"
Notes
" means the twelve thousand (12,000) bonds issued hereunder for an aggregate principal amount of twelve million Euros (EUR 12,000,000), with a par value of one thousand Euros (€ 1,000) each, with Warrant attached (
obligations à bon de souscription d’actions
);
|
-
|
"
Noteholder
"
means the person, including the Subscriber and any subsequent person(s) entered in the Register which the Issuer under this Agreement is required to maintain, as holder(s) of the Notes;
|
-
|
"
Noteholder Office
" means the office through which that Bondholder is holding the Bonds held by it;
|
–
|
"
One Year EUR Libor Rate
" means the one year Euro Libor rate as quoted in the
Wall Street Journal
five (5) Business Days prior to the Closing Date
;
|
–
|
"
Permitted Indebtedness"
means:
|
•
|
any Indebtedness arising under the Natixis Factoring Programme or any new factoring programme entered into to replace or supplement such Natixis Factoring Programme, up to, in total, twenty million dollars ($20,000,000) (or its equivalent in other currencies), which amount shall be increased to twenty five million dollars ($25,000,000) (or its equivalent in other currencies) as from such date upon which the Issuer’s last 12 month revenues are equal to or greater than one hundred million dollars ($100,000,00) and the Notes have started to amortise on schedule;
|
•
|
any Indebtedness arising under any loan agreement entered into or to be entered into with Bpifrance Financement for an aggregate amount of up to $5,000,000 (or its equivalent in other currencies) in aggregate;
|
•
|
the Notes;
|
•
|
any Indebtedness arising under any convertible promissory note issued to the benefit of Nokomis Capital Master Fund, LP for an aggregate principal amount of twenty three million five hundred thousand dollars ($23,500,000);
|
•
|
any Indebtedness arising under any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate, price or currency entered into for the day-to-day business or for hedging purposes (as opposed to speculative purposes);
|
•
|
any Indebtedness arising under any deferred purchase price or any earn-out or any arrangements having a similar economic effect which is payable by the Issuer after completion of an acquisition after the consent of the Noteholder; and
|
•
|
other bank debts, lease obligations and other forms of loan finance of up to one million dollars ($1,000,000) in aggregate(or its equivalent in other currencies).
|
-
|
"
Permitted Security Interest
" means:
|
-
|
the Security Interests constituted by the Security Documents;
|
-
|
any Security Interest granted to secure the Natixis Factoring Programme;
|
-
|
any liens arising by operation of law in the ordinary course of business;
|
-
|
any Security Interest granted to a financing party over any equipment, the purchase of which has been funded by such financing party and the purchase price of which does not exceed five hundred thousand dollars ($500,000);
|
-
|
any netting or set-off arrangement entered into by the Issuer in the ordinary course of its banking arrangements for the purpose of netting debit and credit balances of members of the Issuer’s Group;
|
-
|
any payment or close out netting or set-off arrangement pursuant to any derivative transaction entered into in connection with protection against or benefit from fluctuation
|
-
|
any rental deposit;
|
-
|
any Security Interest securing any Indebtedness arising under any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate, price or currency entered into for the day-to-day business or for hedging purposes (as opposed to speculative purposes) with a limit of four hundred thousand dollars ($400,000); or
|
-
|
any other Security Interests created with the prior written consent of the Noteholder and in respect of the normal and reasonable way of doing business;
|
–
|
"
Pledge of Goodwill Agreement
" means the pledge of goodwill agreement in French language to be entered into on or about the date hereof between, the Issuer, as
constituant
, and the Subscriber, as
bénéficiaire
;
|
–
|
"
Pledge of Intellectual Property Rights Agreement
" means the pledge of intellectual property right agreement to be entered into on or about the date hereof between, the Issuer, as pledgor, and the Subscriber, as beneficiary;
|
–
|
"
Pledge of Receivables Agreement
" means the pledge of receivables agreement to be entered into on or about the date hereof between, the Issuer, as pledgor, and the Subscriber, as beneficiary;
|
–
|
"
Register
" has the meaning ascribed to such term in Clause 12.1;
|
–
|
"
Redemption Date
" means the date falling forty two (42) months after the Closing Date;
|
-
|
"
Security Documents
" means any document entered into by the Issuer from time to time creating any Security Interest, to secure the payment obligations of the Issuer under this Agreement over certain assets of the Issuer, including, without limitation, the Pledge of Intellectual Property Rights Agreement over certain Intellectual Property rights held by the Issuer, the First Ranking Bank Accounts Pledge Agreement over the French bank accounts of the Issuer, the Pledge of receivables Agreement over the receivables held by the Issuer over its clients (to the exception of the receivables assigned under the Natixis Factoring Programme), the Pledge of Goodwill Agreement over the goodwill of the Issuer (
Convention de Nantissement de Fonds de Commerce
), the UK IP Charge, the US Collateral Assignment of Patents Agreements as Security for the Issuer, the US Collateral Assignment of Patents Agreements as Security for Sequans Communications Limited and the US Collateral Assignment of Trademarks as Security for the Issuer;
|
-
|
"
Security Interest
" means any mortgage, charge, assignment, pledge, lien, contractual right of set‑off, hypothecation, encumbrance, priority or other security interest or any arrangement which has substantially the same commercial or substantive effect as the creation of security;
|
–
|
"
Subscriber
" means HESLC II as the initial subscriber to the Notes and Noteholder;
|
–
|
"
TARGET
" means Trans-European Automated Real-time Gross Settlement Express Transfer payment system.
|
–
|
"
TARGET Day
" means any day on which TARGET is open for the settlement of payments in Euro.
|
–
|
"
Term Sheet
" means the term sheet executed between the parties on 24 September, 2018;
|
–
|
"
UK IP Charge
" means the UK charge over certain IP rights (other than patents) to be entered into between Sequans Communications limited, and the Subscriber;
|
–
|
"
US Collateral Assignment of Patents as Security Agreement
" means any of (i) the US assignment of Patents as security agreement to be entered into between the Issuer as Assignor and the Subscriber as Beneficiary and (ii) the US assignment of Patents as security agreement to be entered into between Sequans Communications limited as Assignor and the Subscriber as Beneficiary.
|
–
|
"
Warrant
" means the warrant
(bon de souscription d'action
) attached to the Notes which will be immediately detached (
détaché
) from the Notes upon the issuance of the Notes on the Closing Date, the terms and conditions of which are set out in the provisions of the Warrant Issue Agreement;
|
–
|
"
Warrant Issue Agreement
" means the warrant issue agreement to be entered into on or about the date hereof between Sequans Communications, as issuer, and Harbert European Growth Capital Fund II, as beneficiary;
|
1.2
|
In this Agreement except as otherwise provided or where clearly inconsistent words importing the singular include the plural and vice versa; words denoting gender include every gender; words denoting persons include corporate or unincorporated bodies; and words and expressions in the French language defined in the French Commercial Code as amended shall bear the same meanings herein.
|
2.
|
ISSUE AND SUBSCRIPTION
|
2.1
|
The Notes are issued by the Issuer in registered form exclusively reserved to the Subscriber, for a total maximum principal amount of twelve million Euros (€ 12,000,000), with a par value of one thousand Euros (€ 1,000) per Note as authorized by the Issuer’s Shareholders resolutions dated June 29, 2018, in accordance with Article L. 228-40 of the French Commercial Code.
|
2.2
|
By the end of the Availability Period, the Subscriber shall subscribe the Notes, subject to and upon having received each and every one of the Condition Precedent Documents, in a form deemed satisfactory for the Subscriber.
|
2.3
|
The Subscriber may waive whole or part of the requirements of Article 2.2 in writing to the Issuer.
|
2.4
|
Subscription to the Notes will be wholly paid up by the Subscriber upon signing the subscription form such as the document is identified in schedule 3, by bank transfer. The funds corresponding to the subscription of the Notes shall be made available to the Issuer within five (5) Business Days following the Closing Date.
|
3.
|
PURPOSE OF THE ISSUE
|
3.1
|
The Issue of the Notes is for general corporate purposes and working capital requirements.
|
3.2
|
Without prejudice to the above, the Noteholder shall not be under any obligation to monitor the use of the proceeds of the Issue.
|
4.
|
RANKING
|
5.
|
INTEREST
|
5.1
|
With respect to Notes, the interest rate shall be fixed on the Closing Date at the greater of (i) nine percent (9.00%) per annum or (ii) the One Year EUR Libor Rate, as quoted in the Wall Street Journal five (5) Business Day prior to subscription, plus nine percent (9.00%) per annum.
|
5.2
|
Interest shall be paid in arrears in respect of each Interest Period on each Interest Payment Date, as set out in the interest payment schedule attached as
Annex 2
.
|
5.3
|
Each interest payment shall be made to the Noteholder, such as evidenced on the Register of Noteholder at the close of business on the Business Day preceding the date for payment of such interest, and every such Noteholder shall be deemed, for the purposes of these presents, to be the holder, on such date for payment of interest, of the Notes held by him on such preceding date notwithstanding any intermediate transfer or transmission of any such Notes.
|
5.4
|
Interest on the principal moneys outstanding on any Notes becoming liable to repayment under any provision hereof shall cease to accrue as from the due date for repayment of such principal moneys unless repayment of any such principal moneys and/or payment of any such interest is not effected in which event interest shall continue to accrue at the rate specified in Article 5.5 on the amount which remains unpaid until actual payment in full of such principal moneys and interest is made.
|
5.5
|
Should the Issuer fail to pay any sum (including, but without limitation, any sum payable on each Interest Payment Date pursuant to Article 5.2) on its due date for payment under this Agreement, the Issuer shall pay interest on such sum from the due date (included) up to the date of actual payment (excluded) (as well after as before judgment) at a rate which shall be the aggregate of (a) two percent (2%) per cent per annum and (b) the interest rate set out under Article 5.1 here above.
|
6.
|
REPAYMENT, PURCHASE AND CANCELLATION
|
6.1
|
Pursuant to the amortization table as set forth in
Annex 2
herewith, the Issuer shall repay the principal of the Notes in thirty (30) monthly instalments starting from the Amortization Date, until the Redemption Date (or on such earlier date or dates as the same shall become repayable in accordance with this Agreement).
|
6.2
|
The Issuer may redeem or purchase the outstanding Notes in whole (but not in part) at any time prior to the Redemption Date upon paying to the Noteholder, an amount equal to sum of:
|
(1)
|
the principal and interest payments (including interest accrued but unpaid) due on such early redemption date, or purchase date;
|
(2)
|
the sum of the principal and interest payments which would have been due during the period starting from the early redemption date, or purchase date (in both cases excluded) until the Redemption Date (included) (had such redemption or repurchase not occurred), discounted at a discount rate of 5%
per annum
;
|
(3)
|
the fee due and payable to the Noteholder in accordance with the provisions of Article 19.2 below.
|
6.3
|
Upon the occurrence of a change of control of the Issuer within the meaning of Article L. 233-3 of the French Commercial Code, the Issuer shall promptly notify Noteholder in writing upon becoming aware of the occurrence of such change of control, and the Noteholder may, by not less than 10 Business Days' prior written notice to the Issuer, such notice to be sent within 10 Business Days from the Issuer notifying the Noteholder of the occurrence of such change of control, request the early redemption of the Notes, in which case the Issuer shall redeem the outstanding Notes by paying to the Noteholder, an amount calculated in accordance with the provisions of Article 6.2 above.
|
6.4
|
In the event that following the occurrence of any Event of Default described in Article 10.12 (
Material Adverse Change
), the Noteholder declares the Notes to be immediately due and payable, the Issuer shall redeem the outstanding Notes by paying to the Noteholder, an amount equal to the sum of the outstanding principal of the Notes, together with all interest accrued but unpaid and the fee due and payable to the Noteholder in accordance with the provisions of Article 19.2 below, but without any prepayment penalty or premium (for the avoidance of doubt, the calculations of the prepayment amount set out in Article 6.2 shall not apply this Article 6.4).
|
6.5
|
In the event that following the occurrence of any Event of Default (other than the Event of Default described in Article 10.12 (
Material Adverse Change
) the consequences of which are described under Article 6.4. above), the Noteholder declares the Notes to be immediately due and payable, the Issuer shall redeem the outstanding Notes by paying to the Noteholder, an amount calculated in accordance with the provisions of Article 6.2 above.
|
6.6
|
In the event that the Issuer ceases to carry on the business it carries on at the date hereof and enters into any unrelated business, the Issuer shall promptly notify Noteholder in writing upon becoming aware of the occurrence of the same, and the Noteholder may, by not less than 10 Business Days' prior written notice to the Issuer, such notice to be sent within 10 Business Days from the Issuer notifying the Noteholder of the occurrence of such change in business, declare the Notes immediately due and payable, in which case the Issuer shall redeem the Notes by paying to the Noteholder, an amount equal to the sum of the outstanding principal of the Notes held by it, together with accrued interest thereon and the fee due and payable to the Noteholder in accordance with the provisions of Article 19.2 below, but without any prepayment penalty or premium (for the avoidance of doubt, the calculations of the prepayment amount set out in Article 6.2 shall not apply this Article 6.5).
|
6.7
|
Any Notes repaid or purchased by the Issuer shall be cancelled and the Issuer shall not be entitled to re‑issue the same Notes.
|
6.8
|
Five (5) Business Days prior to the due date for repayment, prepayment or purchase by the Issuer of any Notes (or within such other delay agreed with the Issuer), the Noteholder shall be bound to deliver to the Issuer for review a notice detailing the computation of the amount payable to him in respect of the repayment, prepayment or purchase.
|
7.
|
TAXATION
|
8.
|
REPRESENTATIONS AND WARRANTIES
|
8.1
|
The Issuer makes the following representations and warranties on the date of this Agreement.
|
•
|
that it is acquiring the Notes for investment for its own account, not as a nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof, and that it has no present intention of selling, granting any participation in, or otherwise distributing the same;
|
•
|
that it does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity or to any third person or entity with respect to any of the Notes;
|
•
|
that it has such knowledge and experience in financial and business matters so that it is capable of evaluating the merits and risks of its investment in the Issuer and it understands and acknowledges that an investment in the Issuer is highly speculative and involves substantial risks. It can bear the economic risk of its investment and is able, without impairing its financial condition, to hold the Notes for an indefinite period of time and to suffer a complete loss of its investment;
|
•
|
that it has had an opportunity to ask questions of, and receive answers from, the officers of the Issuer concerning this Bonds Issue Agreement, as well as its business, management and ,financial affairs, which questions were answered to its satisfaction;
|
•
|
that it believes that it has received all the information it considers necessary or appropriate for deciding whether to subscribe the Notes. It acknowledges that any future plans and forward looking statements expressed by the Issuer are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the future plans and forward looking statements will not materialize or will vary significantly from actual results. It also acknowledges that it is relying solely on its own counsel and not on any statements or representations of the Issuer, or any agent or adviser of the Issuer for legal advice with respect to the subscription of the Notes; and
|
•
|
that it is not incorporated or acting through a Noteholder Office situated in a Non-Cooperative Jurisdiction.
|
9.
|
UNDERTAKINGS
|
9.1
|
The Issuer undertakes to the Noteholder to perform all the undertakings set out in this Clause 9 from the date of this Agreement and for so long as any amount is or may be outstanding under this Agreement.
|
9.1.1
|
Authorisations
|
9.1.2
|
Litigation
|
9.1.3
|
Events of Default
|
9.1.4
|
Negative Pledge
|
-
|
create, purport to create any Security Interest over the whole or any part of the Charged Property except for any Permitted Security Interest; or
|
-
|
convey, assign, transfer, or agree to convey, assign or transfer the whole or any part of the Charged Property without the prior written consent of the Noteholder; or
|
-
|
permit or agree to any variation of the rights attaching to the whole or any part of the Charged Property (other than any variation in its commercial relationships with its customers or any variation which may result from the licensing to customers, by the Issuer, of Intellectual Property in the ordinary course of its business), without the prior written consent of the Noteholder; or
|
-
|
knowingly do, cause or permit to be done anything which may in the reasonable opinion of the Noteholder, to a material extent depreciate, jeopardise or otherwise prejudice the value to the Noteholder (whether monetary or otherwise) of the whole or any material part of the Charged Property, it being understood that depreciations of customers (
clientèle
) relating to the Charged Property resulting from the normal course of the Issuer’s business are not material; or
|
-
|
while any amount is outstanding in relation with this Agreement, make any distribution by way of dividend or otherwise howsoever without the prior written consent of the Noteholder;
|
9.1.5
|
Insurance
|
9.1.6
|
Indebtedness
|
9.1.7
|
Subordination
|
9.2
|
The Issuer further undertakes to the Noteholder to perform the undertakings set out in this Clause 9.2, from the date of this Agreement and for so long as any amount is or may be outstanding under this Agreement.
|
9.2.1
|
Delivery of Accounts
|
9.2.2
|
Delivery of financial information
|
9.2.3
|
Information to shareholders
|
9.2.4
|
Reporting requirements
|
9.2.5
|
Board Resolutions and Observer
|
9.2.6
|
Tax information
|
9.2.7
|
Further financial information
|
9.3
|
Information undertakings
|
10.
|
EVENTS OF DEFAULT
|
10.1
|
Non-payment
|
10.2
|
Breach of undertakings
|
10.3
|
Breach of other obligations
|
10.4
|
Cross-default
|
•
|
Any Indebtedness related to secured debt and loans arrangement is not paid when due or within any applicable grace period,
|
•
|
any Indebtedness of the Issuer is declared to be or otherwise becomes due and payable before its specified maturity as a result of an event of default,
|
10.5
|
Insolvency
|
10.6
|
Insolvency proceedings
|
•
|
to enable the Issuer to lawfully enter into, exercise its rights under or perform the obligations expressed to be assumed by it in the Issue Documents to which it is a party;
|
•
|
to ensure that the obligations expressed to be assumed by the Issuer in the Issue Documents to which it is a party are legal, valid and binding, subject to the limitation of enforcement by laws relating to insolvency, reorganisation and other laws generally affecting the rights of creditors;
|
•
|
to make the Issue Documents to which it is a party admissible in evidence in France;
|
10.9
|
Unlawfulness
|
10.10
|
Breach of Contract
|
10.11
|
Analogous proceedings
|
10.12
|
Material adverse change
|
11.
|
VALUATION OF CHARGED PROPERTY
|
12.
|
THE REGISTER
|
13.
|
TRANSMISSION AND TRANSFER
|
13.1
|
The Noteholder will be recognised by the Issuer as entitled to subscribe its (their) Notes free from any equity set-off or cross-claim on the part of the Issuer against the original or any intermediate holder of such Notes.
|
13.2
|
Subject as hereinafter provided, the Noteholder and every subsequent holder of Notes shall be entitled to freely transfer (all but not part) the Notes (provided that the appointment of the Observer in accordance with Article 9.2.5. above as observer (
censeur
) shall be terminated on the effective date of the transfer of the Notes), except to direct competitors of the Issuer. Transfers of the Notes shall be completed by an instrument in writing in the usual common form signed by the transferor.
|
13.3
|
The transferor of any Notes shall be deemed to be the beneficial owner of such Notes until the name of the transferee is entered in the Register in respect thereof.
|
13.4
|
An original of each instrument of transfer must be left at the office of the Issuer's registered office for registration accompanied by if the instrument shall be executed by some other person on behalf of the transferor the authority of that person so to do.
|
13.5
|
No fee may be charged for the registration of transfers or other document relating to or affecting the title to any Notes.
|
13.6
|
The Notes shall not be offered to the public for subscription or purchase and shall not be capable of being dealt in on any stock exchange and no application shall be made to any stock exchange for permission to deal in or for an official or other quotation for the Notes.
|
13.7
|
No Noteholder shall transfer any of its Notes to a transferee incorporated or acting through an Noteholder Office situated in a Non-Cooperative Jurisdiction.
|
13.8
|
If:
|
i.
|
a Noteholder transfers any of the Notes which it holds or changes its Noteholder Office; and
|
ii.
|
as a result of circumstances existing at the date the transfer occurs, the Issuer would be obliged to make a payment to the transferee or the Noteholder acting through its new Noteholder Office under Clause 7 (Taxation),
|
14.
|
PROCEDURE FOR PAYMENT
|
15.
|
RIGHTS OF THE SINGLE NOTEHOLDER
|
15.1
|
The Notes are subscribed by the Subscriber and in accordance with Article 13.2 may only be transferred in all but not in part. Accordingly, there will remain one single Noteholder, which shall exercise under its own name, all rights and powers reserved by the French Commercial Code to the “
Masse
” under the meaning of Article L.228-46 of the French Commercial Code and to Noteholder’ meetings.
|
15.3
|
All decisions made by the Noteholder shall be recorded in a register of the Noteholder’s decisions.
|
16.
|
REMEDIES AND WAIVERS
|
16.1
|
No failure, delay or other relaxation or indulgence on the part of the Noteholder to exercise any power, right or remedy shall operate as a waiver thereof nor shall any single or partial exercise or waiver of any power, right or remedy preclude its further exercise or the exercise of any other power, right or remedy.
|
16.2
|
All rights of the Noteholder contained in this Agreement are in addition to all rights vested or to be vested in it pursuant to the other Issue Documents, common law or statute.
|
17.
|
SEVERABILITY
|
18.
|
NOTICES
|
18.1
|
All notices, demands or other communications under or in connection with this Agreement may be given by letter, facsimile or other comparable means of communication addressed to the person at the address identified below:
|
–
|
All notices to be sent to the Issuer under or in connection with this Agreement shall be sent to the following recipient
:
SEQUANS COMMUNICATIONS, 15-55, boulevard Charles de Gaulle Les Portes de la Défense - 92700 Colombes.
|
–
|
All notices to be sent to the Subscriber under or in connection with this Agreement shall be sent to the following recipient: Jerome Fonteneau - jfonteneau@harbert.net at Harbert European Fund Advisors Ltd, Brookfield House, 5th Floor, 44 Davies Street, London W1K 5JA, United Kingdom
|
-
|
if personally delivered, at the time of delivery;
|
-
|
if by letter, at noon on Business Day following the day such letter was posted (or in the case of airmail, seven days after the envelope containing the same was delivered into the custody of the postal authorities); and
|
-
|
if by facsimile transmission or comparable means of communication during the business hours of the addressee then on the day of transmission, otherwise on the next following Business Day.
|
18.2
|
In proving such service it shall be sufficient to prove that personal delivery was made or that such letter was properly stamped first class, addressed and delivered to the postal authorities or in the case of facsimile transmission or other comparable means of communication that a confirming hard copy was provided promptly after transmission.
|
19.
|
FEES
|
19.1
|
On the Closing Date, the Issuer shall pay to HESLC II an arrangement fee equal to one percent (1.00%) of the initial principal amount of the Notes, which amount shall be paid by way of set-off against the subscription price of the Notes.
|
19.2
|
On the earlier of (i) the final payment by the Issuer under this Agreement or (ii) the release of the Security Interests under the Security Documents, the Issuer shall pay to HESLC II a supplementary fee equal to two point five percent (2.5%) of the initial principal amount of the Notes.
|
20.
|
TRANSACTION EXPENSES
|
20.1
|
Upon subscription of the Notes in accordance with Article 2.4, the Issuer shall pay to the Subscriber all duly documented costs, fees and expenses including legal fees (up to a maximum of €60,000 plus VAT) reasonably incurred by it in connection with the negotiation, preparation and execution of the Issue Documents and the perfection of the Security Interests granted pursuant to the Security Documents.
|
20.2
|
The Issuer shall pay all stamp, documentary, registration and other like duties or taxes to which this Agreement is or at any time may be subject (other than any duties or taxes resulting from a change to the Noteholder Office or from any voluntary registration of a Issue Document made by any Noteholder which is not required as a matter of law).
|
20.3
|
The Issuer shall, from time to time on demand of the Noteholder, forthwith indemnify the Noteholder against any , costs, claims, expenses and direct liabilities resulting from any failure to pay any amount due under the Issue Documents on its due date or any delay in paying any such amounts (without double counting with any late payment interest due pursuant to Clause 5.5),and the Noteholder shall produce a certificate of amounts claimed under such indemnity within a reasonable time of the date of such claim.
|
20.4
|
All fees and expenses payable pursuant to this Article shall be paid together with VAT (if any) properly chargeable thereon.
|
21.
|
CONFIDENTIALITY
|
21.1
|
The Parties will keep the Issue Documents, and their subject matter and all information received thereunder or pursuant thereto (the “
Confidential Information
”) confidential, except if they are required by law or regulation or judicial process or at the request of an administrative authority to disclose the same. The Noteholder undertake(s) to hold confidential all Confidential Information which it acquires under or in connection with the Issue documents, pursuant to the provisions of a separate confidentiality agreement entered into on or about the date hereof with the Issuer.
|
22.
|
LAW AND JURISDICTION
|
/s/ Georges Karam
__________________________
SEQUANS COMMUNICATIONS
As Issuer
Represented by: Georges Karam
Title: president and chief executive officer
|
/s/ Christophe Jacomin
_______________________________________________________
HARBERT FUND ADVISORS, INC. AS INVESTMENT MANAGER FOR HARBERT EUROPEAN SPECIALTY LENDING COMPANY II S.à r.l
As Subscriber
Represented by: Christophe Jacomin
Title: attorney/partner
|
1.
|
A copy, certified as a true, complete and up-to-date copy by a duly authorised officer, of the by-laws (
statuts
) of the Issuer.
|
2.
|
A copy, certified as a true copy by a duly authorised officer of the board resolutions of the Issuer, authorizing the Issue, the issue of the Warrant (as set out in Article 1) and authorizing a named person or persons, other than the Director if the case may be, to execute the Issue Documents and to give all notices and take all other actions required by such party under the Issue Documents.
|
3.
|
A certificate of a duly authorised officer of the Issuer setting out the names and signatures of the persons authorised to execute the Issue Documents and to give all notices and take all other actions required by such party under the Issue Documents.
|
4.
|
The Security Documents to be executed on or prior to the Closing Date duly executed by all the parties thereto and all documents executed pursuant thereto and all documents required thereby.
|
5.
|
Execution of all the Bond Issue Agreement and the Security Documents.
|
6.
|
No material, significant, unexpected or undisclosed adverse change in the business, results of operations, forecasts, condition (financial or otherwise), assets, liabilities or prospects or the Issuer’s Group, taken as a whole, since the date of the last audited financial statements.
|
7.
|
An illustrative exit waterfall showing the proceeds payable to the Subscriber or its nominee under the warrant in the case of a theoretical exit as follows:
|
8.
|
Copy of the notification by the Issuer to Natixis Factor of the USD 25,000,000 limit to the Natixis Factoring Programme as stated in the definition of Permitted Indebtedness under the Bond Issue Agreement.
|
Company Name:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date of Funding
|
|
1-Nov-18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EOM of 1st Funding
|
|
30-Nov-18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Days in Between
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Start of month of 1st Funding
|
1-Nov-18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Days in Month
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Loan Commitment
|
|
12,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
I/O Period
|
Repayment period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All amounts in :
|
|
€
|
|
Total length
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
T1
|
|
12,000,000
|
|
12
|
30.00
|
42.00
|
|
|
|
|
|
|
|
|
|
|
|
|
|
T2
|
|
0
|
|
0
|
0
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Facility
|
|
12,000,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash interest Rate
|
|
9.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Arrangement Fee Total Facility
|
1.00%
|
120,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Backend Fee
|
|
2.50%
|
300,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Prepayment Discount
|
|
5.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Monthly Payment T1
|
|
448,178
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With Principal Discounted
|
||
|
|
Tranche 1
|
|
Arrangement/Backend Fee
|
|
Payment Due
|
Total Payments
|
|
Total Interest Payment
|
Total Principal Payments
|
Total Exposure Outstanding
|
|
Interest Payments
|
Principal Payments
|
Prepayment Amount Assuming Full prepayment at month end
|
||||
|
|
BB
|
Int
|
Princ
|
Pmt
|
EB
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11/1/2018
|
0
|
0.00
|
0.00
|
-12,000,000.00
|
-12,000,000.00
|
12,000,000.00
|
|
120,000.00
|
|
11/1/2018
|
-11,880,000.00
|
|
0.00
|
-12,000,000.00
|
12,000,000.00
|
|
0.00
|
0.00
|
|
11/30/2018
|
1
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
11/30/2018
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,488,768.65
|
12/31/2018
|
2
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
12/31/2018
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,452,786.51
|
1/31/2019
|
3
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
1/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,411,432.13
|
2/28/2019
|
4
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
2/28/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,375,128.86
|
3/31/2019
|
5
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
3/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,336,944.09
|
4/30/2019
|
6
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
4/30/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,300,331.52
|
5/31/2019
|
7
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
5/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,261,846.20
|
6/30/2019
|
8
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
6/30/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,224,921.79
|
7/31/2019
|
9
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
7/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,187,844.06
|
8/31/2019
|
10
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
8/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,148,906.74
|
9/30/2019
|
11
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
9/30/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,111,513.36
|
10/31/2019
|
12
|
12,000,000.00
|
90,000.00
|
0.00
|
90,000.00
|
12,000,000.00
|
|
0.00
|
|
10/31/2019
|
90,000.00
|
|
90,000.00
|
0.00
|
12,000,000.00
|
|
90,000.00
|
0.00
|
13,072,269.33
|
11/30/2019
|
13
|
12,000,000.00
|
90,000.00
|
358,177.93
|
448,177.93
|
11,641,822.07
|
|
0.00
|
|
11/30/2019
|
448,177.93
|
|
90,000.00
|
358,177.93
|
11,641,822.07
|
|
90,000.00
|
358,177.93
|
13,033,070.41
|
12/31/2019
|
14
|
11,641,822.07
|
87,313.67
|
360,864.26
|
448,177.93
|
11,280,957.81
|
|
0.00
|
|
12/31/2019
|
448,177.93
|
|
87,313.67
|
360,864.26
|
11,280,957.81
|
|
87,313.67
|
360,864.26
|
12,634,043.49
|
1/31/2020
|
15
|
11,280,957.81
|
84,607.18
|
363,570.75
|
448,177.93
|
10,917,387.06
|
|
0.00
|
|
1/31/2020
|
448,177.93
|
|
84,607.18
|
363,570.75
|
10,917,387.06
|
|
84,607.18
|
363,570.75
|
12,230,289.56
|
2/29/2020
|
16
|
10,917,387.06
|
81,880.40
|
366,297.53
|
448,177.93
|
10,551,089.54
|
|
0.00
|
|
2/29/2020
|
448,177.93
|
|
81,880.40
|
366,297.53
|
10,551,089.54
|
|
81,880.40
|
366,297.53
|
11,827,929.15
|
3/31/2020
|
17
|
10,551,089.54
|
79,133.17
|
369,044.76
|
448,177.93
|
10,182,044.78
|
|
0.00
|
|
3/31/2020
|
448,177.93
|
|
79,133.17
|
369,044.76
|
10,182,044.78
|
|
79,133.17
|
369,044.76
|
11,422,471.03
|
4/30/2020
|
18
|
10,182,044.78
|
76,365.34
|
371,812.59
|
448,177.93
|
9,810,232.18
|
|
0.00
|
|
4/30/2020
|
448,177.93
|
|
76,365.34
|
371,812.59
|
9,810,232.18
|
|
76,365.34
|
371,812.59
|
11,016,756.23
|
5/31/2020
|
19
|
9,810,232.18
|
73,576.74
|
374,601.19
|
448,177.93
|
9,435,631.00
|
|
0.00
|
|
5/31/2020
|
448,177.93
|
|
73,576.74
|
374,601.19
|
9,435,631.00
|
|
73,576.74
|
374,601.19
|
10,608,038.65
|
6/30/2020
|
20
|
9,435,631.00
|
70,767.23
|
377,410.70
|
448,177.93
|
9,058,220.30
|
|
0.00
|
|
6/30/2020
|
448,177.93
|
|
70,767.23
|
377,410.70
|
9,058,220.30
|
|
70,767.23
|
377,410.70
|
10,198,941.98
|
7/31/2020
|
21
|
9,058,220.30
|
67,936.65
|
380,241.28
|
448,177.93
|
8,677,979.02
|
|
0.00
|
|
7/31/2020
|
448,177.93
|
|
67,936.65
|
380,241.28
|
8,677,979.02
|
|
67,936.65
|
380,241.28
|
9,788,146.56
|
8/31/2020
|
22
|
8,677,979.02
|
65,084.84
|
383,093.09
|
448,177.93
|
8,294,885.94
|
|
0.00
|
|
8/31/2020
|
448,177.93
|
|
65,084.84
|
383,093.09
|
8,294,885.94
|
|
65,084.84
|
383,093.09
|
9,374,492.18
|
9/30/2020
|
23
|
8,294,885.94
|
62,211.64
|
385,966.28
|
448,177.93
|
7,908,919.65
|
|
0.00
|
|
9/30/2020
|
448,177.93
|
|
62,211.64
|
385,966.28
|
7,908,919.65
|
|
62,211.64
|
385,966.28
|
8,960,273.31
|
10/31/2020
|
24
|
7,908,919.65
|
59,316.90
|
388,861.03
|
448,177.93
|
7,520,058.62
|
|
0.00
|
|
10/31/2020
|
448,177.93
|
|
59,316.90
|
388,861.03
|
7,520,058.62
|
|
59,316.90
|
388,861.03
|
8,543,292.37
|
11/30/2020
|
25
|
7,520,058.62
|
56,400.44
|
391,777.49
|
448,177.93
|
7,128,281.13
|
|
0.00
|
|
11/30/2020
|
448,177.93
|
|
56,400.44
|
391,777.49
|
7,128,281.13
|
|
56,400.44
|
391,777.49
|
8,125,622.00
|
12/31/2020
|
26
|
7,128,281.13
|
53,462.11
|
394,715.82
|
448,177.93
|
6,733,565.31
|
|
0.00
|
|
12/31/2020
|
448,177.93
|
|
53,462.11
|
394,715.82
|
6,733,565.31
|
|
53,462.11
|
394,715.82
|
7,706,217.29
|
1/31/2021
|
27
|
6,733,565.31
|
50,501.74
|
397,676.19
|
448,177.93
|
6,335,889.12
|
|
0.00
|
|
1/31/2021
|
448,177.93
|
|
50,501.74
|
397,676.19
|
6,335,889.12
|
|
50,501.74
|
397,676.19
|
7,282,450.17
|
2/28/2021
|
28
|
6,335,889.12
|
47,519.17
|
400,658.76
|
448,177.93
|
5,935,230.36
|
|
0.00
|
|
2/28/2021
|
448,177.93
|
|
47,519.17
|
400,658.76
|
5,935,230.36
|
|
47,519.17
|
400,658.76
|
6,859,544.26
|
3/31/2021
|
29
|
5,935,230.36
|
44,514.23
|
403,663.70
|
448,177.93
|
5,531,566.66
|
|
0.00
|
|
3/31/2021
|
448,177.93
|
|
44,514.23
|
403,663.70
|
5,531,566.66
|
|
44,514.23
|
403,663.70
|
6,434,122.17
|
4/30/2021
|
30
|
5,531,566.66
|
41,486.75
|
406,691.18
|
448,177.93
|
5,124,875.48
|
|
0.00
|
|
4/30/2021
|
448,177.93
|
|
41,486.75
|
406,691.18
|
5,124,875.48
|
|
41,486.75
|
406,691.18
|
6,007,693.64
|
5/31/2021
|
31
|
5,124,875.48
|
38,436.57
|
409,741.36
|
448,177.93
|
4,715,134.12
|
|
0.00
|
|
5/31/2021
|
448,177.93
|
|
38,436.57
|
409,741.36
|
4,715,134.12
|
|
38,436.57
|
409,741.36
|
5,578,848.64
|
6/30/2021
|
32
|
4,715,134.12
|
35,363.51
|
412,814.42
|
448,177.93
|
4,302,319.69
|
|
0.00
|
|
6/30/2021
|
448,177.93
|
|
35,363.51
|
412,814.42
|
4,302,319.69
|
|
35,363.51
|
412,814.42
|
5,148,868.66
|
7/31/2021
|
33
|
4,302,319.69
|
32,267.40
|
415,910.53
|
448,177.93
|
3,886,409.16
|
|
0.00
|
|
7/31/2021
|
448,177.93
|
|
32,267.40
|
415,910.53
|
3,886,409.16
|
|
32,267.40
|
415,910.53
|
4,717,103.22
|
8/31/2021
|
34
|
3,886,409.16
|
29,148.07
|
419,029.86
|
448,177.93
|
3,467,379.30
|
|
0.00
|
|
8/31/2021
|
448,177.93
|
|
29,148.07
|
419,029.86
|
3,467,379.30
|
|
29,148.07
|
419,029.86
|
4,283,072.37
|
9/30/2021
|
35
|
3,467,379.30
|
26,005.34
|
422,172.58
|
448,177.93
|
3,045,206.72
|
|
0.00
|
|
9/30/2021
|
448,177.93
|
|
26,005.34
|
422,172.58
|
3,045,206.72
|
|
26,005.34
|
422,172.58
|
3,847,711.78
|
10/31/2021
|
36
|
3,045,206.72
|
22,839.05
|
425,338.88
|
448,177.93
|
2,619,867.84
|
|
0.00
|
|
10/31/2021
|
448,177.93
|
|
22,839.05
|
425,338.88
|
2,619,867.84
|
|
22,839.05
|
425,338.88
|
3,410,187.53
|
11/30/2021
|
37
|
2,619,867.84
|
19,649.01
|
428,528.92
|
448,177.93
|
2,191,338.92
|
|
0.00
|
|
11/30/2021
|
448,177.93
|
|
19,649.01
|
428,528.92
|
2,191,338.92
|
|
19,649.01
|
428,528.92
|
2,971,202.36
|
12/31/2021
|
38
|
2,191,338.92
|
16,435.04
|
431,742.89
|
448,177.93
|
1,759,596.03
|
|
0.00
|
|
12/31/2021
|
448,177.93
|
|
16,435.04
|
431,742.89
|
1,759,596.03
|
|
16,435.04
|
431,742.89
|
2,530,394.34
|
1/31/2022
|
39
|
1,759,596.03
|
13,196.97
|
434,980.96
|
448,177.93
|
1,324,615.07
|
|
0.00
|
|
1/31/2022
|
448,177.93
|
|
13,196.97
|
434,980.96
|
1,324,615.07
|
|
13,196.97
|
434,980.96
|
2,087,218.82
|
2/28/2022
|
40
|
1,324,615.07
|
9,934.61
|
438,243.32
|
448,177.93
|
886,371.76
|
|
0.00
|
|
2/28/2022
|
448,177.93
|
|
9,934.61
|
438,243.32
|
886,371.76
|
|
9,934.61
|
438,243.32
|
1,642,740.13
|
3/31/2022
|
41
|
886,371.76
|
6,647.79
|
441,530.14
|
448,177.93
|
444,841.62
|
|
0.00
|
|
3/31/2022
|
448,177.93
|
|
6,647.79
|
441,530.14
|
444,841.62
|
|
6,647.79
|
441,530.14
|
1,196,355.86
|
4/30/2022
|
42
|
444,841.62
|
3,336.31
|
444,841.62
|
448,177.93
|
0.00
|
|
300,000.00
|
|
4/30/2022
|
748,177.93
|
|
3,336.31
|
444,841.62
|
0.00
|
|
3,336.31
|
444,841.62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
–
|
HARBERT EUROPEAN SPECIALTY LENDING COMPANY II S.à r.l., a company with a limited liability (
société à responsabilité limitée
) incorporated under the laws of Luxembourg whose registered office is at 5, rue Guillaume Kroll, L-1882 Luxembourg (the “
Subscriber
”),
|
–
|
the by-laws (
statuts
) of Sequans Communications (the “
Issuer
”), a French
société anonyme
, having its registered office at 15-55, boulevard Charles de Gaulle Les Portes de la Défense - 92700 Colombes, FRANCE, and registered with the Nanterre Registry under number 450 249 677,
|
–
|
the Issuer’s Board resolution dated [•], 2018, fixing the terms of the issuance of twelve thousand (12,000) Notes for a total maximum principal amount of twelve million Euros (€ 12,000,000), and a par value of one thousand Euros (€ 1,000) per Note with authorization from the [•] resolution of the general meeting of the shareholders of the Issuer dated 29 June 2018 approving the issue of the Notes in registered form exclusively reserved to the Subscriber, and
|
–
|
the terms and conditions of the Notes as set out in the Agreement and the terms and conditions of the Warrant as set out in the Warrant Issue Agreement,
|
–
|
Full name and address of the bank: [•]
|
–
|
Account holder: [•]
|
–
|
Account number: [•]
|
–
|
IBAN: [•]
|
–
|
SWIFT (BIC): [•]
|
1.
|
SEQUANS COMMUNICATIONS
,
a limited company (
société anonyme
), whose registered office is at 15-55, boulevard Charles de Gaulle Les Portes de la Défense - 92700 Colombes, registered with the Nanterre Registry under number 450 249 677,
|
2.
|
HARBERT EUROPEAN GROWTH CAPITAL FUND II, SCSp
, a
société en commandite special
, whose registered office is 5, rue Guillaume Kroll, L - 1882 Luxemburg (Luxemburg), incorporated under the laws of Luxemburg under registration number B213751,
|
1.
|
Pursuant to a Bond Issue Agreement executed on 26 October, 2018 (the “
Bond Issue Agreement
”), HARBERT EUROPEAN SPECIALTY LENDING COMPANY II S.à r.l. has agreed to make available to the Issuer
a nominal amount equal to Euros twelve million (EUR 12,000,000), through a bond issuance (the “
Issue
”) pursuant section L. 228-38 and
seq
. of the French Commercial Code (the “
FCC”
), for general corporate purposes and working capital requirements.
|
2.
|
As an inducement to provide the Issue to the Company, such Issue has been subordinated to the issuance by the Company of the Warrant (as such term is defined below), in compliance with the present Agreement, to access at certain time in the future the share capital of the Company pursuant to the following terms and conditions.
|
1.
|
DEFINITIONS AND INTERPRETATIONS
|
1.1
|
In this Agreement (as hereinafter defined) unless the context otherwise specifically provides, the following expressions shall have the following meanings:
|
–
|
“
Agreement
”
means this Warrant Issue Agreement.
|
–
|
“
Bond Issue Agreement
” means the bond issue agreement entered into on 26 October 2018
between the Company and HARBERT EUROPEAN SPECIALTY LENDING COMPANY II S.à r.l..
|
–
|
“
Business Day
”
has the meaning ascribed to this term in the Bond Issue Agreement.
|
–
|
“
Closing Date
” means the date on which the Notes are subscribed.
|
–
|
“
Company
”
means Sequans Communications, a limited company (
société anonyme
), whose registered office is at 15-55, boulevard Charles de Gaulle Les Portes de la Défense- 92700 Colombes, registered with the Nanterre Registry under number 450 249 677.
|
–
|
“Encumbrances”
means any mortgage, charge, pledge, lien, option, restriction, right of first refusal, right of pre-emption, third party right or interest, any other encumbrance of any kind, and any other type of preferential arrangement (including, without limitation, title transfer and retention arrangements) having a similar effect.
|
-
|
“
Event of Default
” means any of those events set out in Article 10 (
Events of Default
) of the Bond Issue Agreement.
|
-
|
“
Exercise Period
” has the meaning given in Article 2.4 below.
|
–
|
“
Exercise Price
” means in relation to each Warrant Share to be issued pursuant to the terms of this Agreement, either (i) the volume-weighted average price per American Depository Shares of the Company traded on the New York Stock Exchange (symbol: SQNS - CUSIP number: 817323108 - ISIN number: US8173231080) during the last ten trading days prior to the Closing Date or (ii) on a net issuance basis pursuant to Article 2.3.2. (b), as the content so requires.
|
-
|
“
Existing Warrants Holders
” means existing holders of warrants issued by the Company on Closing Date as provided under Schedule 1 hereto.
|
-
|
“
FCC
” means the French Commercial Code.
|
-
|
“
Holder
” means the Beneficiary and any subsequent holders of the Warrant.
|
-
|
“Issue”
means
the bond issue carried out pursuant to the Bond Issue Agreement.
|
-
|
“
Issuer
” means the Company.
|
–
|
“
Notes
” means the bonds issued under the Bond Issue Agreement for an amount of twelve million Euros (€ 12,000,000).
|
–
|
“
Securities
” refers to (i) shares, (ii) any other equity securities, debt instruments, or other issued securities conferring access to a portion of the share capital or voting rights, immediately or in the future, including in particular, options to subscribe to or purchase shares and equity warrants (
bons de souscription d’actions
) and (iii) any right to be allotted, subscribe to, or any right of priority pertaining to the aforementioned Shares, securities or rights, whether or not attaching to such shares, securities or rights.
|
–
|
“
Sequans Communications Capitalization Table
” means Sequans Communications capitalization table as of Closing Date provided under Schedule 1 hereto and including all Sequans Communications shareholders, holding on that date more than 5% of its share capital or voting rights, along with all Existing Warrants Holders, provided however that such capitalization table is indicative and based on the most recent 13D and 13G filings.
|
–
|
“
Share(s)
” means the common/preferred shares, existing or future, issued by the Company in representation of its capital and outstanding as at the relevant date irrespective of their class or category.
|
–
|
“
Share Sale
” means a sale (
vente
), for any reason, of a number of shares of the Company entitling the transferee(s) to control the Company within the meaning of article L. 233-3 of FCC.
|
–
|
“Subscription Rights”
means the rights conferred by the Warrant and in accordance with the provisions of this Agreement.
|
–
|
“
Transfer
” or ”
Transferred
” refers to any transaction pursuant to which, immediate or future ownership title, co-ownership, bare ownership or usufruct on Securities held by a Party is transferred, for any reason whatsoever, with or without consideration (including in particular, further to a sale, assignment of a preferential right to subscribe or waiver of such right to the benefit of a specified person, donation, transfer in lieu of payment (
dation en paiement
), settlement, exchange, securities lending transaction, dismemberment, public auction, partial asset contribution (
apport partiel d’actifs
), merger, demerger or any combination thereof).
|
–
|
“
Warrant
” means the
bon de souscription d’action
HEGCF to be issued by the Company to HEGCF pursuant to the provisions of this Agreement.
|
–
|
“
Warrant Shares
” means the Shares subscribed by HEGCF as a result of the exercise of the Warrant.
|
–
|
“
Winding-Up
” means any of the following events to have commenced: (i) if an order is made or an effective resolution passed for the winding up or dissolution of any Group Company (other than a winding up for the purposes of amalgamation or reconstruction) whether voluntarily or involuntarily; or (ii) if an encumbrancer takes possession or an administrator, receiver or administrative receiver is appointed over the whole or a material part of the assets or undertaking of any Group Company (and for this purpose a part of the assets or undertaking shall be material if the value thereof exceeds 10% of the value of the gross assets of the Group all as determined by reference to the latest published consolidated audited accounts of the Company subject to any adjustments as the Company’s
|
1.2
|
Save as expressly herein defined, capitalised terms defined in the Bond Issue Agreement shall have the same meaning when used herein.
|
1.3
|
In this Agreement, except as otherwise provided or where clearly inconsistent, words importing the singular include the plural and vice versa; words denoting gender include every gender; words denoting persons include bodies corporate or incorporated.
|
1.4
|
Should there be any conflict between the provisions of this Agreement and the provisions of the Bond Issue Agreement, the provisions of the Bond Issue Agreement shall prevail.
|
2.1.
|
Warrant
|
(a)
|
the payment in cash for each of the Warrant Shares at the Exercise Price; or
|
|
Z=
|
Y(B-C)
A
|
Where:
|
X=
|
the number of Warrant Shares to be issued to the Holder (disregarding any fractional entitlement);
|
|
Y=
|
the number of Warrant Shares with respect to which the Holder is exercising its Subscription Rights;
|
|
A=
|
the fair market value of each Warrant Share on the date of exercise, calculated in accordance with Article 2.3.3;
|
|
B=
|
the Exercise Price; and
|
|
C=
|
the par value of a Warrant Share.
|
2.4
|
Duration of exercise of the Warrant
|
(i)
|
allow the Beneficiary to exercise its BSA HEGCF if the Exercise Period stipulated in the present terms and conditions is not already open or if conditions of the exercise of the Subscription Rights are not entirely fulfilled, such that the Holder may immediately participate in the planned transactions or benefit from them, or
|
(ii)
|
carry out an adjustment (the "
Adjustment
") to the subscription conditions initially stipulated, in such a way as to take into account the impact of the planned transactions.
|
1.
|
permit the Holder to exercise its Warrant immediately so that the Holder may participate in the rights issue, which will not alter or limit the rights of the Holder to exercise the Warrant under Article 2 of this Agreement; or
|
2.
|
take any measures which would allow the Holder, should it decides to exercise the Warrant, to eventually be in the same position as other shareholders as if the Holder were a shareholder at the time of such operations. Should the Holder exercise its Warrant, the Company could thus allow the Holder to subscribe a pro rata Share of a new rights’ issue or be the beneficiary of free allocation of Shares, or receive cash or goods under the same form, proportion, terms and conditions (except for use) as those set in favor of then existing shareholders when such operations occurred; or
|
3.
|
adjust the Exercise Price, conversion-into-shares ratio or other terms relating to subscription of the Shares in order to take into account the new rights issue. In such case, any such adjustment shall be carried out in accordance with the method set forth in Article R.228-91 of the FCC, it being specified that the value of an existing shareholder’s right to participate, as well as the value of the Share itself (including the right to participate in the rights issue), shall be determined by the board of directors of the Company. The board shall determine such value while taking into account, as the case may be, the subscription, exchange or sale price per Share used during the last operation relating to the Company’s share capital (such as any share capital increase, contribution in kind, sale of shares,...) which occurred during a six (6)-month period immediately preceding such board of directors’ meeting. In the event no such operation occurred over such period, the board shall take into account any other financial parameter which it finds relevant (and which relevancy shall then be confirmed by the Company’s statutory auditor).
|
4.
|
REPRESENTATIONS AND WARRANTIES
|
4.1
|
The representations and warranties contained in Article 8.1.1, 8.1.2, 8.1.4, 8.1.6, 8.1.7 and 8.1.9 of the Bond Issue Agreement shall apply (
Representations and Warranties
) in this Agreement.
|
4.2
|
The Beneficiary acknowledges the terms and conditions of the Warrant, including:
|
•
|
that neither the Warrant nor the Warrant Shares have been registered under the U.S. Securities Act of 1933, as amended (the “
Securities Act
”) by reason of a specific exemption from the registration provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the representations below;
|
•
|
that it is acquiring the Warrant for investment for its own account, not as a nominee or agent, and not with the view to, or for resale in connection with, any distribution thereof, and that it has no present intention of selling, granting any participation in, or otherwise distributing the same;
|
•
|
that it does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participation to such person or entity or to any third person or entity with respect to any of the Warrant Shares;
|
•
|
that it is an institutional “accredited investor” as defined in Regulation D, Rule 501(a) under the Securities Act, has such knowledge and experience in financial and business matters so that it is capable of evaluating the merits and risks of its investment in the Issuer and it understands and acknowledges that an investment in the Issuer is highly speculative and involves substantial risks. It can bear the economic risk of its investment and is able, without impairing its financial condition, to hold the Warrant and the Warrant Shares for an indefinite period of time and to suffer a complete loss of its investment;
|
•
|
that it has had an opportunity to ask questions of, and receive answers from, the officers of the Issuer concerning this Warrant Agreement, as well as its business, management and financial affairs, which questions were answered to its satisfaction;
|
•
|
that it believes that it has received all the information it considers necessary or appropriate for deciding whether to receive Warrant. It acknowledges that any future plans and forward looking statements expressed by the Issuer are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying the future plans and forward looking statements will not materialize or will vary significantly from actual results. It also acknowledges that it is relying solely on its own counsel and not on any statements or representations of the Issuer, or any agent or adviser of the Issuer for legal advice with respect to the subscription of the Warrant;
|
•
|
that the Warrant is being acquired by it in reliance on a private placement exemption from the registration requirements of the Securities Act and the Warrants Shares are and will be “restricted securities” within the meaning of Rule 144(a) (3) under the Securities Act and that the exemption from registration provided under Rule 144 may not be available for resales by it of the Warrants Shares. Therefore, it further agrees that if it wishes to dispose of or exchange any of the Warrant Shares, it will not transfer any of the Warrant Shares, directly or indirectly, unless such transfer is a transaction that is deemed to occur outside of the United States under Regulation S under the Securities Act, or pursuant to an available exemption from, or in a transaction not subject to, the registration requirements, of the Securities Act. The Company may require, as a condition of allowing any transfer, that the holder or transferee of the Warrant Shares, as the case may be, provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Warrant Shares under the Securities Act.
|
5.
|
REMEDIES AND WAIVERS
|
7.1
|
All notices, demands or other communications under or in connection with this Agreement may be given by letter, facsimile or other comparable means of communication addressed to the person at the address identified with its signature below.
|
-
|
if personally delivered, at the time of delivery;
|
-
|
if by letter, at noon on Business Day following the day such letter was posted (or in the case of airmail, seven days after the envelope containing the same was delivered into the custody of the postal authorities); and
|
-
|
if by facsimile transmission or comparable means of communication during the business hours of the addressee then on the day of transmission, otherwise on the next following Business Day.
|
7.2
|
In proving such service it shall be sufficient to prove that personal delivery was made or that such letter was properly stamped first class, addressed and delivered to the postal authorities or in the case of facsimile transmission or other comparable means of communication that a confirming hard copy was provided promptly after transmission.
|
7.3
|
All notices to be sent to the Beneficiary under or in connection with this Agreement shall be sent to the following recipients:
|
–
|
To:
HARBERT EUROPEAN GROWTH CAPITAL FUND II, SCSp, 5, rue Guillaume Kroll, L - 1882 Luxemburg (Luxemburg); and
|
–
|
With a copy to:
HARBERT EUROPEAN FUND ADVISORS LTD, Brookfield House, 5
th
Floor, 44 DaviesStreet, London W1K 5JA, UK.
|
7.4
|
All notices to be sent to the Issuer under or in connection with this Agreement shall be sent to the following recipient:
|
–
|
To:
SEQUANS COMMUNICATIONS, 15-55, boulevard Charles de Gaulle Les Portes de la Défense - 92700 Colombes.
|
8.
|
LAW AND JURISDICTION
|
/s/ Georges Karam
|
/s/ Christophe Jacomin
|
___________________________
SEQUANS COMMUNICATIONS
as Issuer
|
___________________________
Harbert Fund Advisors, Inc.
as investment manager
for Harbert European Growth Capital Fund II, SCS
p
as Beneficiary
|
By: Georges KARAM
|
By: Christophe Jacomin
|
Title: president and chief executive officer
|
Title: attorney / partner
|
|
NEWS
|
|
|
|
|
Three months ended
|
||||||||||
|
(in thousands of US$, except share and per share amounts)
|
Sept 30,
2018 |
|
|
June 30,
2018 |
|
|
Sept 30,
2017 |
|
|||||
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
||||||
|
Revenue :
|
|
|
|
|
|
||||||||
|
|
Product revenue
|
$
|
7,526
|
|
|
$
|
9,921
|
|
|
$
|
8,869
|
|
|
|
|
Other revenue
|
2,759
|
|
|
2,737
|
|
|
2,430
|
|
||||
|
Total revenue
|
10,285
|
|
|
12,658
|
|
|
11,299
|
|
|||||
|
Cost of revenue
|
|
|
|
|
|
||||||||
|
|
Cost of product revenue
|
6,026
|
|
|
7,127
|
|
|
5,678
|
|
||||
|
|
Cost of other revenue
|
664
|
|
|
549
|
|
|
615
|
|
||||
|
Total cost of revenue
|
6,690
|
|
|
7,676
|
|
|
6,293
|
|
|||||
|
Gross profit
|
3,595
|
|
|
4,982
|
|
|
5,006
|
|
|||||
|
Operating expenses :
|
|
|
|
|
|
||||||||
|
|
Research and development
|
6,750
|
|
|
7,152
|
|
|
6,769
|
|
||||
|
|
Sales and marketing
|
2,229
|
|
|
2,518
|
|
|
2,014
|
|
||||
|
|
General and administrative
|
2,545
|
|
|
2,276
|
|
|
1,786
|
|
||||
|
|
|
|
|
|
|
|
|
||||||
|
Total operating expenses
|
11,524
|
|
|
11,946
|
|
|
10,569
|
|
|||||
|
Operating loss
|
(7,929
|
)
|
|
(6,964
|
)
|
|
(5,563
|
)
|
|||||
|
Financial income (expense):
|
|
|
|
|
|
||||||||
|
|
Interest income (expense), net
|
(1,278
|
)
|
|
(1,240
|
)
|
|
(1,202
|
)
|
||||
|
|
Convertible debt amendment
|
(685
|
)
|
|
—
|
|
|
—
|
|
||||
|
|
Foreign exchange gain (loss)
|
58
|
|
|
188
|
|
|
(90
|
)
|
||||
|
Loss before income taxes
|
(9,834
|
)
|
|
(8,016
|
)
|
|
(6,855
|
)
|
|||||
|
Income tax expense (benefit)
|
78
|
|
|
74
|
|
|
65
|
|
|||||
|
Loss
|
$
|
(9,912
|
)
|
|
$
|
(8,090
|
)
|
|
$
|
(6,920
|
)
|
||
|
Attributable to :
|
|
|
|
|
|
||||||||
|
|
Shareholders of the parent
|
(9,912
|
)
|
|
(8,090
|
)
|
|
(6,920
|
)
|
||||
|
|
Minority interests
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Basic loss per share
|
|
($0.10
|
)
|
|
|
($0.09
|
)
|
|
|
($0.09
|
)
|
||
|
Diluted loss per share
|
|
($0.10
|
)
|
|
|
($0.09
|
)
|
|
|
($0.09
|
)
|
||
|
Weighted average number of shares used for computing:
|
|
|
|
|
|
||||||||
|
— Basic
|
94,533,229
|
|
|
94,459,289
|
|
|
79,774,103
|
|
|||||
|
— Diluted
|
94,533,229
|
|
|
94,459,289
|
|
|
79,774,103
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended Sept 30,
|
||||||
(in thousands of US$, except share and per share amounts)
|
2018
|
|
2017
|
||||||
|
|
|
|
|
|
||||
Revenue :
|
|
|
|
||||||
|
Product revenue
|
$
|
25,082
|
|
|
$
|
28,668
|
|
|
|
Other revenue
|
9,095
|
|
|
8,278
|
|
|||
Total revenue
|
34,177
|
|
|
36,946
|
|
||||
Cost of revenue
|
|
|
|
||||||
|
Cost of product revenue
|
19,014
|
|
|
18,731
|
|
|||
|
Cost of other revenue
|
1,902
|
|
|
1,795
|
|
|||
Total cost of revenue
|
20,916
|
|
|
20,526
|
|
||||
Gross profit
|
13,261
|
|
|
16,420
|
|
||||
Operating expenses :
|
|
|
|
||||||
|
Research and development
|
21,421
|
|
|
19,217
|
|
|||
|
Sales and marketing
|
7,232
|
|
|
6,582
|
|
|||
|
General and administrative
|
6,792
|
|
|
4,520
|
|
|||
|
|
|
|
|
|
||||
Total operating expenses
|
35,445
|
|
|
30,319
|
|
||||
Operating loss
|
(22,184
|
)
|
|
(13,899
|
)
|
||||
Financial income (expense):
|
|
|
|
||||||
|
Interest income (expense), net
|
(3,745
|
)
|
|
(3,434
|
)
|
|||
|
Convertible debt amendment
|
(685
|
)
|
|
—
|
|
|||
|
Foreign exchange gain (loss)
|
34
|
|
|
(962
|
)
|
|||
Loss before income taxes
|
(26,580
|
)
|
|
(18,295
|
)
|
||||
Income tax expense (benefit)
|
171
|
|
|
219
|
|
||||
Loss
|
$
|
(26,751
|
)
|
|
$
|
(18,514
|
)
|
||
Attributable to :
|
|
|
|
||||||
|
Shareholders of the parent
|
(26,751
|
)
|
|
(18,514
|
)
|
|||
|
Minority interests
|
—
|
|
|
—
|
|
|||
Basic loss per share
|
|
($0.29
|
)
|
|
|
($0.24
|
)
|
||
Diluted loss per share
|
|
($0.29
|
)
|
|
|
($0.24
|
)
|
||
Weighted average number of shares used for computing:
|
|
|
|
||||||
— Basic
|
93,486,416
|
|
|
76,918,723
|
|
||||
— Diluted
|
93,486,416
|
|
|
76,918,723
|
|
|
|
At Sept 30,
|
|
|
At December 31,
|
|||
(in thousands of US$)
|
2018
|
|
|
2017
|
|
|||
|
|
|
|
|
||||
ASSETS
|
|
|
|
|||||
|
Non-current assets
|
|
|
|
||||
|
Property, plant and equipment
|
$
|
6,652
|
|
|
$
|
6,993
|
|
|
Intangible assets
|
11,573
|
|
|
9,561
|
|
||
|
Deposits and other receivables
|
390
|
|
|
402
|
|
||
|
Available for sale assets
|
340
|
|
|
353
|
|
||
|
Total non-current assets
|
18,955
|
|
|
17,309
|
|
||
|
Current assets
|
|
|
|
||||
|
Inventories
|
7,287
|
|
|
7,376
|
|
||
|
Trade receivables
|
20,803
|
|
|
20,826
|
|
||
|
Prepaid expenses and other receivables
|
3,357
|
|
|
4,214
|
|
||
|
Recoverable value added tax
|
508
|
|
|
688
|
|
||
|
Research tax credit receivable
|
2,841
|
|
|
3,248
|
|
||
|
Short term deposit
|
—
|
|
|
347
|
|
||
|
Cash and cash equivalents
|
5,179
|
|
|
2,948
|
|
||
|
Total current assets
|
39,975
|
|
|
39,647
|
|
||
Total assets
|
$
|
58,930
|
|
|
$
|
56,956
|
|
|
|
|
|
|
|
||||
EQUITY AND LIABILITIES
|
|
|
|
|||||
|
Equity
|
|
|
|
||||
|
Issued capital, euro 0.02 nominal value, 94,586,764 shares authorized, issued and outstanding at September 30, 2018 (80,024,707 shares at December 31, 2017)
|
$
|
2,384
|
|
|
$
|
2,031
|
|
|
Share premium
|
225,470
|
|
|
204,952
|
|
||
|
Other capital reserves
|
39,035
|
|
|
33,313
|
|
||
|
Accumulated deficit
|
(262,564
|
)
|
|
(235,813
|
)
|
||
|
Other components of equity
|
(486
|
)
|
|
(435
|
)
|
||
|
Total equity
|
3,839
|
|
|
4,048
|
|
||
|
Non-current liabilities
|
|
|
|
||||
|
Government grant advances, loans and other liabilities
|
5,969
|
|
|
5,030
|
|
||
|
Convertible debt and accrued interest
|
16,708
|
|
|
17,063
|
|
||
|
Provisions and other liabilities
|
1,703
|
|
|
1,584
|
|
||
|
Deferred revenue
|
930
|
|
|
1,293
|
|
||
|
Total non-current liabilities
|
25,310
|
|
|
24,970
|
|
||
|
Current liabilities
|
|
|
|
||||
|
Trade payables
|
13,591
|
|
|
13,023
|
|
||
|
Interest-bearing receivables financing
|
9,549
|
|
|
7,413
|
|
||
|
Government grant advances
|
832
|
|
|
1,592
|
|
||
|
Provisions and other current liabilities
|
4,612
|
|
|
5,170
|
|
||
|
Deferred revenue
|
1,197
|
|
|
740
|
|
||
|
Total current liabilities
|
29,781
|
|
|
27,938
|
|
||
Total equity and liabilities
|
$
|
58,930
|
|
|
$
|
56,956
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended Sept 30,
|
||||||
(in thousands of US$)
|
2018
|
|
|
2017
|
|
|||||
|
|
|
|
|
|
|
||||
Operating activities
|
|
|
|
|||||||
|
Loss before income taxes
|
$
|
(26,580
|
)
|
|
$
|
(18,295
|
)
|
||
|
Non-cash adjustment to reconcile income before tax to net cash from (used in) operating activities
|
|
|
|
||||||
|
|
Depreciation and impairment of property, plant and equipment
|
2,372
|
|
|
2,025
|
|
|||
|
|
Amortization and impairment of intangible assets
|
2,334
|
|
|
1,758
|
|
|||
|
|
Share-based payment expense
|
1,505
|
|
|
958
|
|
|||
|
|
Increase (decrease) in provisions
|
66
|
|
|
675
|
|
|||
|
|
Financial expense (income)
|
3,745
|
|
|
3,434
|
|
|||
|
|
Convertible debt amendment
|
685
|
|
|
—
|
|
|||
|
|
Foreign exchange loss (gain)
|
(174
|
)
|
|
567
|
|
|||
|
Working capital adjustments
|
|
|
|
||||||
|
|
Decrease (Increase) in trade receivables and other receivables
|
847
|
|
|
(2,057
|
)
|
|||
|
|
Decrease (Increase) in inventories
|
89
|
|
|
(155
|
)
|
|||
|
|
Decrease (Increase) in research tax credit receivable
|
407
|
|
|
(484
|
)
|
|||
|
|
Decrease in trade payables and other liabilities
|
114
|
|
|
(7,299
|
)
|
|||
|
|
Increase (decrease) in deferred revenue
|
94
|
|
|
(112
|
)
|
|||
|
|
Decrease in government grant advances
|
(744
|
)
|
|
(403
|
)
|
|||
|
Income tax paid
|
(80
|
)
|
|
(206
|
)
|
||||
Net cash flow used in operating activities
|
(15,320
|
)
|
|
(19,594
|
)
|
|||||
|
|
|
|
|
|
|
||||
Investing activities
|
|
|
|
|||||||
|
Purchase of intangible assets and property, plant and equipment
|
(4,456
|
)
|
|
(4,096
|
)
|
||||
|
Capitalized development expenditures
|
(2,224
|
)
|
|
—
|
|
||||
|
Sale (purchase) of financial assets
|
25
|
|
|
(101
|
)
|
||||
|
Sale of short-term deposit
|
347
|
|
|
—
|
|
||||
|
Interest received
|
71
|
|
|
47
|
|
||||
Net cash flow used in investments activities
|
(6,237
|
)
|
|
(4,150
|
)
|
|||||
|
|
|
|
|
|
|
||||
Financing activities
|
|
|
|
|||||||
|
Proceeds from issue of warrants, exercise of stock options/warrants
|
30
|
|
|
906
|
|
||||
|
Public equity offering proceeds, net of transaction costs paid
|
20,840
|
|
|
14,942
|
|
||||
|
Proceeds (Repayment of) from interest-bearing receivables financing
|
2,136
|
|
|
(131
|
)
|
||||
|
Proceeds from interest-bearing research project financing
|
1,574
|
|
|
1,126
|
|
||||
|
Repayment of government loans
|
(352
|
)
|
|
(56
|
)
|
||||
|
Interest paid
|
(438
|
)
|
|
(272
|
)
|
||||
Net cash flows from financing activities
|
23,790
|
|
|
16,515
|
|
|||||
|
|
|
|
|
|
|
||||
|
Net increase (decrease) in cash and cash equivalents
|
2,233
|
|
|
(7,229
|
)
|
||||
|
Net foreign exchange difference
|
(2
|
)
|
|
9
|
|
||||
|
Cash and cash equivalent at January 1
|
2,948
|
|
|
20,202
|
|
||||
Cash and cash equivalents at end of the period
|
$
|
5,179
|
|
|
$
|
12,982
|
|
|||
|
|
|
|
|
|
|
(in thousands of US$, except share and per share amounts)
|
Three months ended
|
||||||||||||
Sept 30,
2018 |
|
|
June 30,
2018 |
|
|
Sept 30,
2017 |
|
||||||
Net IFRS loss as reported
|
$
|
(9,912
|
)
|
|
$
|
(8,090
|
)
|
|
$
|
(6,920
|
)
|
||
Add back
|
|
|
|
|
|
||||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
446
|
|
|
526
|
|
|
310
|
|
||||
|
Non-cash interest on Convertible debt and other financing
(2)
|
761
|
|
|
745
|
|
|
759
|
|
||||
|
Non-cash impact of Convertible debt amendment
|
685
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
$
|
(8,020
|
)
|
|
$
|
(6,819
|
)
|
|
$
|
(5,854
|
)
|
IFRS basic loss per share as reported
|
|
($0.10
|
)
|
|
|
($0.09
|
)
|
|
|
($0.09
|
)
|
||
Add back
|
|
|
|
|
|
||||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
|
$0.00
|
|
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
Non-cash interest on Convertible debt and other financing
(2)
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
Non-cash impact of Convertible debt amendment
|
|
$0.01
|
|
|
|
$0.00
|
|
|
|
$0.00
|
|
|
|
|
|
|
|
|
||||||||
Non-IFRS basic loss per share
|
|
($0.08
|
)
|
|
|
($0.07
|
)
|
|
|
($0.07
|
)
|
||
IFRS diluted loss per share
|
|
($0.10
|
)
|
|
|
($0.09
|
)
|
|
|
($0.09
|
)
|
||
Add back
|
|
|
|
|
|
||||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
|
$0.00
|
|
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
Non-cash interest on Convertible debt and other financing
(2)
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
$0.01
|
|
|
|
Non-cash impact of Convertible debt amendment
|
|
$0.01
|
|
|
|
$0.00
|
|
|
|
$0.00
|
|
|
|
|
|
|
|
|
||||||||
Non-IFRS diluted loss per share
|
|
($0.08
|
)
|
|
|
($0.07
|
)
|
|
|
($0.07
|
)
|
||
|
|
|
|
|
|
|
|
||||||
|
(1) Included in the IFRS loss as follows:
|
|
|
|
|
|
|||||||
|
|
Cost of product revenue
|
$
|
2
|
|
|
$
|
3
|
|
|
$
|
2
|
|
|
|
Research and development
|
116
|
|
|
127
|
|
|
87
|
|
|||
|
|
Sales and marketing
|
66
|
|
|
73
|
|
|
55
|
|
|||
|
|
General and administrative
|
262
|
|
|
323
|
|
|
166
|
|
|||
|
|
|
|
|
|
|
|
||||||
|
(2) Related to the difference between contractual and effective interests
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
(in thousands of US$, except share and per share amounts)
|
Nine months ended Sept 30,
|
||||||||
2018
|
|
2017
|
|||||||
Net IFRS loss as reported
|
$
|
(26,751
|
)
|
|
$
|
(18,514
|
)
|
||
Add back
|
|
|
|
||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
1,504
|
|
|
958
|
|
|||
|
Non-cash interest on Convertible debt and other financing (2)
|
2,177
|
|
|
2,119
|
|
|||
|
Non-cash impact of Convertible debt amendment
|
685
|
|
|
—
|
|
|||
|
$
|
(22,385
|
)
|
|
$
|
(15,437
|
)
|
||
IFRS basic loss per share as reported
|
|
($0.29
|
)
|
|
|
($0.24
|
)
|
||
Add back
|
|
|
|
||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
|
$0.02
|
|
|
|
$0.01
|
|
|
|
Non-cash interest on Convertible debt and other financing
(2)
|
|
$0.02
|
|
|
|
$0.03
|
|
|
|
Non-cash impact of Convertible debt amendment
|
|
$0.01
|
|
|
|
$0.00
|
|
|
Non-IFRS basic loss per share
|
|
($0.24
|
)
|
|
|
($0.20
|
)
|
||
IFRS diluted loss per share
|
|
($0.29
|
)
|
|
|
($0.24
|
)
|
||
Add back
|
|
|
|
||||||
|
Stock-based compensation expense according to IFRS 2
(1)
|
|
$0.02
|
|
|
|
$0.01
|
|
|
|
Non-cash interest on Convertible debt and other financing
(2)
|
|
$0.02
|
|
|
|
$0.03
|
|
|
|
Non-cash impact of Convertible debt amendment
|
|
$0.01
|
|
|
|
$0.00
|
|
|
Non-IFRS diluted loss per share
|
|
($0.24
|
)
|
|
|
($0.20
|
)
|
||
|
|
|
|
|
|
||||
|
(1) Included in the IFRS loss as follows:
|
|
|
|
|||||
|
|
Cost of product revenue
|
$
|
8
|
|
|
$
|
7
|
|
|
|
Research and development
|
382
|
|
|
293
|
|
||
|
|
Sales and marketing
|
219
|
|
|
199
|
|
||
|
|
General and administrative
|
895
|
|
|
459
|
|
||
|
|
|
|
|
|
||||
|
(2) Related to the difference between contractual and effective interests
|
|
|
|
|||||
|
|
|
|
|
|