| Item 1.01 | Entry into a Material Definitive Agreement. |
On October 1, 2019, GigCapital, Inc., a Delaware corporation (“GigCapital”), and Kepos Alpha Fund L.P., a Cayman Islands limited partnership (“KAF”), entered into a Forward Share Purchase Agreement (“Purchase Agreement”) pursuant to which GigCapital agreed to purchase the shares of common stock of GigCapital into which the rights of GigCapital (NYSE: GIG.RT) (the “Rights”) held by KAF, including any additional rights (the “Additional Rights”) that KAF may acquire, will convert into upon the closing of GigCapital’s business combination with Kaleyra, S.p.A. (the “Business Combination”) (all such shares, the “Shares”) at the following price: (1) $1.05 per Right for the first 1,000,000 Rights (which reflects $10.50 per Share for the first 100,000 Shares); and (2) $1.07 per Right for the next 3,329,950 Rights (which reflects $10.70 per Share for the next 332,995 Shares). GigCapital agreed to purchase the Shares on the earlier of (A) the sixtieth day after the closing of the Business Combination or (B) February 15, 2020 (the “Closing Date”). As of October 1, 2019, KAF held 579,950 Rights, and KAF may acquire up to 2,750,000 Additional Rights after October 1, 2019 and prior to the closing of the Business Combination.
In exchange for GigCapital’s commitment to acquire the Shares on the Closing Date, KAF agreed to continue to hold, and not to offer, sell, contract to sell, pledge, transfer, assign, or otherwise dispose of, directly or indirectly, or hedge (including any transactions involving any derivative securities of GigCapital and including any Short Sales (as defined below) involving any of GigCapital’s securities), the Rights (including any Additional Rights), and any Shares that the Rights (including any Additional Rights) convert into, until the Closing Date, including not to tender the Rights (or any Additional Rights) to GigCapital in response to any tender offer that GigCapital may commence for the rights. For purposes of the Purchase Agreement, “Short Sales” include, without limitation, all “short sales” as defined in Rule 200 promulgated under Regulation SHO under the Securities and Exchange Act of 1934 (the “Exchange Act”), whether or not against the box, and all types of direct and indirect stock pledges, forward sales contracts, options, puts, calls, short sales, swaps, “put equivalent positions” (as defined in Rule16a-1(h) under the Exchange Act) and similar arrangements (including on a total return basis), and sales and other transactions throughnon-U.S. broker dealers or foreign regulated brokers. Notwithstanding the forgoing, the parties agreed that KAF shall after the closing of the Business Combination have the right but not the obligation to sell any or all of its Shares into in the open market if the share price equals or exceeds $10.50 per Share. Furthermore, the parties agreed that nothing in the Purchase Agreement shall prohibit Greenhaven from entering into a contract to purchase and/or sell warrants of GigCapital.
The Purchase Agreement contains customary representations, warranties and covenants from the parties. Each party’s obligation to consummate the transactions contemplated by the Purchase Agreement is subject to the consummation of the Business Combination in addition to other customary conditions.
The Purchase Agreement may be terminated: (i) by mutual written consent of GigCapital and KAF; (ii) automatically if GigCapital’s stockholders fail to approve the Business Combination; and (iii) by KAF by giving written notice to GigCapital on the date that is one business day prior to the Closing Date.
The foregoing description is only a summary of the Purchase Agreement and is qualified in its entirety by reference to the full text of the Purchase Agreement, which is filed as Exhibit 10.1 and is incorporated by reference herein. The Purchase Agreement is included as an exhibit to this Current Report onForm 8-K in order to provide investors and security holders with material information regarding its terms and the transaction. It is not intended to provide any other factual information about GigCapital or KAF. The representations, warranties and covenants contained in the Purchase Agreement were made only for purposes of that agreement; are solely for the benefit of the parties to the Purchase Agreement; may have been made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts; and may be subject to standards of materiality applicable to the parties that differ from those applicable to investors. Investors should not rely on the representations, warranties or covenants or any description thereof as characterizations of the actual state of facts or condition of GigCapital or KAF.
As previously disclosed in GigCapital’s Current Report on Form8-K filed with the Securities and Exchange Commission on September 3, 2019, GigCapital intends to commence a cash tender offer for the outstanding rights which would be closed in conjunction with the closing of the Business Combination, but pursuant to the terms of the Purchase Agreement, such Rights and Additional Rights would not be tendered by KAF to GigCapital in response to such tender offer.
