EXHIBIT 10.3

 

Agreement, dated as of December 31, 2018, by and between ZTI Acquisition
Subsidiary III Inc. and Riverside KM Beteiligung GmbH, on various issues in
relation to postponed closing

 

[Attached]

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31 December 2018

 

 

 

Riverside KM Beteiligung GmbH

(as Seller)

 

and

 

ZTI Merger Subsidiary III, Inc.

(as Purchaser)

 

  

 

 

 

 

 

Agreement on Various Issues in relation to Postponed Closing

related to

PROJECT CONNECT

 

 

 

 

 

 

 

AGREEMENT ON VARIOUS ISSUES IN RELATION TO POSTPONED CLOSING

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This Agreement on various issues in relation to postponed closing (the
"Agreement") is dated 31 December 2018,

and made by and between

(1)

Riverside KM Beteiligung GmbH, a limited liability company (Gesellschaft mit
beschränkter Haftung) organized under the laws of Germany, registered with the
commercial register (Handelsregister) of the local court (Amtsgericht) of
Hanover under registration number HRB 208686, and having its registered office
in Alter Hof 5, 80331 München (the "Seller"); and

(2)

ZTI Merger Subsidiary III Inc., a corporation with limited liability, organized
under the laws of Delaware, registered under registration number 3056631 and
having its business address in 7195 Oakport Street, Oakland, California 94621
and its registered office in 15 East North St., City of Dover, County of Kent,
Delaware, USA (the "Purchaser")

(the Seller and the Purchaser collectively referred to as the "Parties", and
each of them as a "Party").

 

Recitals

A.

Whereas, on 5/6 October 2018, the Parties entered into a Share Purchase
Agreement notarized by the notary public Dr. Gesa Beckhaus in Hamburg (roll of
deeds no. 1206/2018 B) according to which the Seller sold all of its shares in
Keymile GmbH, a limited liability company (Gesellschaft mit beschränkter
Haftung) under the laws of Germany, having its registered office at
Wohlenbergstraße 3, 30179 Hannover, registered with the commercial register
(Handelsregister) of the local court (Amtsgericht) of Hanover under registration
number HRB 208686, to the Purchaser (the "SPA").

B.

Whereas, according to Section 8.2.1 (h) of the SPA, the Seller shall provide the
Purchaser with a copy of the Sell-Side W&I Insurance (the "Policy").

C.

Whereas, the Policy states in its Section 7.15 that a payment of any Insured
Loss (as defined thereunder) shall be made to (i) the Seller or (ii) directly
with discharging effect (schuldbefreiend) to Keymile GmbH upon written request
to AIG by the Seller.

D.

WHEREAS, the Parties discussed with regard to the Policy how to make sure that
although the Seller is the insured party under the policy it is finally secured
that payments under the Policy received by the Seller are used to satisfy any
Insured Loss (as defined under the Policy). The Parties agreed to enter into
this agreement which shall give the right to the Purchaser to demand from the
Seller

(i) payment of any Insured Loss (as defined under the Policy) by AIG directly to
Keymile GmbH or, alternatively in case this is not accepted by AIG,

(ii) immediate forwarding of any payments received from AIG under the Policy to
the Purchaser,

in each case less any commercially reasonable and proven costs, expenditures or
losses the Seller will incur in connection with the Insured Tax Event (including
payments made from the Seller to the Company, as defined in the SPA, or to the
Purchaser in this respect) (the “Seller’s Enforcement Costs”). For the avoidance
of doubt, costs, expenditures or losses resulting from any delay under or any
breach of the obligations of the Seller under the Policy are not included in the
Seller's Enforcement Costs.

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E.

WHEREAS, pursuant to Section 8.1 of the SPA, Closing should have taken place at
9:00 a.m. (CET) on 27 December 2018 (the "Actual Closing Date"). While the
Seller wanted to close on the Actual Closing Date, the Purchaser proposed to
have Closing on 3 January 2019, 9:00 a.m. (CET) (the "Deferred Closing Date").
After further discussions between the Parties, the Seller accepts (without
prejudice in any way) to currently not enforce the NY Law Guarantee based on (i)
the assumption that Closing will occur on the Deferred Closing Date and (ii) the
mutual understanding of the Seller and the Purchaser that the Purchaser will
indemnify and hold harmless (freistellen) the Seller from and against specific
liabilities as specified hereafter in section 3.2 hereof.

NOW, THEREFORE, the Parties agree as follows:

 

1.

Definitions

Capitalized terms used but not defined in this Agreement shall have the meanings
ascribed thereto in the SPA and in the Policy, unless the context requires
otherwise.

2.

Agreement Regarding Sell-Side W&I Insurance

2.1

Subject to (aufschiebend bedingt auf) the occurrence of Closing on the Deferred
Closing Date, the Parties hereby agree the following with regard to Section 7.15
of the Policy:

 

a)

The Purchaser has the right to instruct the Seller to demand from the Insurer
the payment of any Insured Loss (except for an amount to be paid to the Seller
to cover the Seller’s Enforcement Costs) directly with discharging effect
(schuldbefreiend) to Keymile GmbH in accordance with Section 7.15 of the Policy.
Upon such request the Seller shall without undue delay request from the Insurer
that payment of the Insured Loss (after having deducted the Seller’s Enforcement
Costs) shall be made with discharging effect (schuldbefreiend) to Keymile GmbH.
The Seller shall provide a copy of such request and confirmation of receipt to
the Purchaser. Or in case such payment instruction is not accepted by AIG,

 

b)

Seller shall immediately forward any payments received from AIG under the Policy
to the Purchaser with the exception of those amounts necessary to cover the
Seller’s Enforcement Costs.

2.2

The Seller shall keep the Purchaser reasonably informed to enable the Purchaser
to exercise its rights under this Section 2. Further, the Seller shall deliver
to the Purchaser the calculation and underlying proof of any Seller's
Enforcement Costs, and the Purchaser has the right to review.

3.

Postponed Closing

3.1

The Seller herewith accepts, without prejudice in any way, to not enforce the NY
Law Guarantee until the Deferred Closing Date.

3.2

The Purchaser acknowledges that, at the Seller’s request, it will indemnify and
hold harmless (freistellen) the Seller from and against commercially reasonable
and proven (nachgewiesenen) liabilities, damages, losses, costs and/or expenses
which are caused by the fact that Closing has not occurred on the Actual Closing
Date (“Delayed Closing Costs”), thereby understood that

 

(a)

as of today the Seller is not aware (hat keine positive Kenntnis) of any Delayed
Closing Costs until the Deferred Closing Date and does not assume (but as of
today cannot exclude also) to face Delayed Closing Costs until the Deferred
Closing Date other than those mentioned in below lit. (c) and (d) of this Clause
3.2; any Delayed Closing Costs the Seller is aware of (hat positive Kenntnis)

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as of today and which are not mentioned in below lit. (c) and (d) of this Clause
3.2 are explicitly excluded and no obligation of the Purchaser to indemnify the
Seller shall arise due to such known Delayed Closing Costs; and

 

(b)

Seller shall use best effort to minimize any Delayed Closing Costs; and

 

(c)

fees for the Seller’s legal advisors shall be capped at an amount of EUR 20,000
provided that Closing occurs on the Deferred Closing Date; and

 

(d)

Delayed Closing Costs might occur due to the fact that the PLTA (as defined in
the SPA) now remains valid throughout the entire year 2018 and has not been
terminated anytime in 2018 due to Closing not having occurred on the Actual
Closing Date with the proviso that in case those costs are caused by income
taxes (German corporate and trade Tax) the costs shall be limited to those
economically relating to Keymile GmbH and for time periods starting on the Tax
Effective Date (as defined in the SPA).

For the avoidance of doubt, it remains Seller's obligation to indemnify and hold
harmless the Purchaser from and against any and all withholding taxes payable by
a Group Entity on actual or constructive dividends of a Group Entity up and
until the Deferred Closing Date.

3.3

The Seller declares that it will not charge Default Interest pursuant to Section
5.4.1 of the SPA if Closing occurs on the Deferred Closing Date at the latest.

4.

Governing Law And Jurisdiction

4.1

This Agreement shall be governed by German law, excluding the German conflict of
law rules and excluding the United Nations Convention on Contracts for the
International Sale of Goods (CISG).

4.2

Any dispute, controversy or claim under or in connection with this Agreement or
its validity shall be finally settled by three arbitrators in accordance with
the Arbitration Rules of the German Institution of Arbitration e.V. (DIS),
including the Supplementary Rules for Expedited Proceedings, without recourse to
the ordinary courts of law. The venue of the arbitration shall be Hamburg,
Germany. The language of the arbitration proceedings shall be English, provided,
however, that written evidence may be submitted in either the English or the
German language. In the event that mandatory applicable law requires any
dispute, controversy or claim under or in connection with this Agreement or its
validity to be decided upon by an ordinary court of law, the competent courts in
Hamburg, Germany shall have exclusive jurisdiction.

5.

Severability

If any court of competent jurisdiction holds any provision of this Agreement
invalid or unenforceable, the other provisions of this Agreement shall remain in
full force and effect. The invalid or unenforceable provision shall be deemed to
have been replaced by a valid, enforceable and fair provision which comes as
close as possible to the intentions of the Parties hereto at the time of the
conclusion of this Agreement. It is the express intent of the Parties that the
validity and enforceability of all other provisions of this Agreement shall be
maintained and that this Section 4 shall not result in a reversal of the burden
of proof but that Section 139 BGB is hereby excluded in its entirety.

[Signature page follow]

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SIGNATURES

 

 

31 December 2018 / Munich  (date/place)

 

/s/ Peter Schaberger / Bernd Starrock
Riverside KM Beteiligung GmbH, represented by:
Name: Peter Schaberger / Bernd Starrock
Position: Managing Directors

 

31 December 2018 / Hamburg  (date/place)

 

/s/ Jan-Philipp Meier
ZTI Merger Subsidiary III, Inc., represented by:
Name: Jan-Philipp Meier
Position: on the basis of power of attorney dated                  

               25 September 2018

 

 

 

 

 

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