UNDERWRITING AGREEMENT between GLOBAL ALTERNATIVE ASSET MANAGEMENT, INC. and EARLYBIRDCAPITAL, INC., MAXIM GROUP LLC and LADENBURG THALMANN & CO. INC. Dated: _______________, 2008
between
and
EARLYBIRDCAPITAL,
INC.,
MAXIM
GROUP LLC
and
LADENBURG
XXXXXXXX & CO.
INC.
Dated:
_______________, 2008
_____________,
2008
EarlyBirdCapital,
Inc.
As
Representative of the Several Underwriters listed in
Schedule I Hereto
000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx,
Xxx Xxxx 00000
Dear
Sirs:
The
undersigned, Global Alternative Asset Management, Inc., a Delaware corporation
(“Company”), hereby confirms its agreement with EarlyBirdCapital, Inc. (being
referred to herein variously as “EBC” or the “Representative”) and with the
other underwriters named on Schedule I hereto for which EBC is acting as
Representative (the Representative and the other Underwriters being collectively
called the “Underwriters” or, individually, an “Underwriter”) as
follows:
1. Purchase
and Sale of Securities.
1.1 Firm
Securities.
1.1.1 Purchase
of Firm Units.
On the
basis of the representations and warranties herein contained, but subject to
the
terms and conditions herein set forth, the Company agrees to issue and sell,
severally and not jointly, to the several Underwriters, an aggregate of
20,000,000 (“Firm Units”) of the Company at a purchase price (net of discounts
and commissions) of $9.30 per Firm Unit (including discounts and commissions
of
$0.35 per Firm Unit (the “Deferred Discount”) that will not be paid to the
Underwriters unless and until a Business Combination (as defined below) has
been
consummated by the Company). The Underwriters, severally and not jointly, agree
that they will not seek payment of the Deferred Discount unless and until a
Business Combination has been consummated by the Company, and the Company agrees
that it shall pay such discounts and commissions only upon consummation of
such
Business Combination. The Underwriters, severally and not jointly, agree to
purchase from the Company the number of Firm Units set forth opposite their
respective names on Schedule I attached hereto and made a part hereof at a
purchase price (net of discounts and commissions) of $9.30 per Firm Unit. The
Firm Units are to be offered initially to the public (“Offering”) at the
offering price of $10.00 per Firm Unit. Each Firm Unit consists of one share
of
the Company’s common stock, par value $.0001 per share (“Common Stock”), and one
warrant (“Warrant(s)”). The shares of Common Stock and the Warrants included in
the Firm Units will not be separately transferable until 90 days after the
effective date (“Effective Date”) of the Registration Statement (as defined in
Section 2.1.1 hereof) unless EBC informs the Company of its decision to allow
earlier separate trading, but in no event will EBC allow separate trading until
the preparation of an audited balance sheet of the Company reflecting receipt
by
the Company of the proceeds of the Offering and the filing of a Form 8-K by
the
Company which includes such balance sheet. Each Warrant entitles its holder
to
exercise it to purchase one share of Common Stock for $7.50 during the period
commencing on the later of six months after the consummation by the Company
of
its “Business Combination” or one year from the Effective Date and terminating
on the five-year anniversary of the Effective Date. “Business Combination” shall
mean any merger, capital stock exchange, asset acquisition or other similar
business combination consummated by the Company with an operating business
(as
described more fully in the Registration Statement).
1.1.2 Payment
and Delivery.
Delivery and payment for the Firm Units shall be made at 10:00 A.M., New York
time, on the third business day following commencement of trading of the Firm
Units or at such earlier time as shall be agreed upon by the Representative
and
the Company at the offices of the Representative or at such other place as
shall
be agreed upon by the Representative and the Company. The hour and date of
delivery and payment for the Firm Units are called “Closing Date.” Payment for
the Firm Units shall be made on the Closing Date at the Representative’s
election by wire transfer in Federal (same day) funds or by certified or bank
cashier’s check(s) in New York Clearing House funds, payable as follows:
$192,175,000 of the proceeds received by the Company for the Firm Units shall
be
deposited in the trust fund established by the Company to the extent set forth
in the Registration Statement for the benefit of the public stockholders (“Trust
Fund”), pursuant to the terms of an Investment Management Trust Agreement
(“Trust Agreement”) and the remaining proceeds shall be paid (subject
to Section 3.13 hereof) to
the
order of the Company upon delivery to the Representative of certificates (in
form and substance satisfactory to the Underwriters) representing the Firm
Units
(or through the facilities of the Depository Trust Company (“DTC”)) for the
account of the Underwriters. The Firm Units shall be registered in such name
or
names and in such authorized denominations as the Representative may request
in
writing at least two full business days prior to the Closing Date. The Company
will permit the Representative to examine and package the Firm Units for
delivery, at least one full business day prior to the Closing Date. The Company
shall not be obligated to sell or deliver the Firm Units except upon tender
of
payment by the Representative for all the Firm Units.
1.2 Over-Allotment
Option.
1.2.1 Option
Units.
For the
purposes of covering any over-allotments in connection with the distribution
and
sale of the Firm Units, the Underwriters are hereby granted, severally and
not
jointly, an option to purchase up to an additional 3,000,000 units from the
Company (“Over-allotment Option”). Such additional 3,000,000 units are
hereinafter referred to as “Option Units.” The Firm Units and the Option Units
are hereinafter collectively referred to as the “Units,” and the Units, the
shares of Common Stock and the Warrants included in the Units and the shares
of
Common Stock issuable upon exercise of the Warrants are hereinafter referred
to
collectively as the “Public Securities.” The purchase price to be paid for the
Option Units will be the same price per Option Unit as the price per Firm Unit
set forth in Section 1.1.1 hereof.
1.2.2 Exercise
of Option.
The
Over-allotment Option granted pursuant to Section 1.2.1 hereof may be
exercised by the Representative as to all (at any time) or any part (from time
to time) of the Option Units within 45 days after the Effective Date. The
Underwriters will not be under any obligation to purchase any Option Units
prior
to the exercise of the Over-allotment Option. The Over-allotment Option granted
hereby may be exercised by the giving of oral notice to the Company by the
Representative, which must be confirmed in writing by overnight mail or
facsimile transmission setting forth the number of Option Units to be purchased
and the date and time for delivery of and payment for the Option Units (the
“Option Closing Date”), which will not be later than five full business days
after the date of the notice or such other time as shall be agreed upon by
the
Company and the Representative, at the offices of the Representative or at
such
other place as shall be agreed upon by the Company and the Representative.
Upon
exercise of the Over-allotment Option, the Company will become obligated to
convey to the Underwriters, and, subject to the terms and conditions set forth
herein, the Underwriters will become obligated to purchase, the number of Option
Units specified in such notice.
1.2.3 Payment
and Delivery.
Payment
for the Option Units shall be made on the Option Closing Date at the
Representative’s election by wire transfer in Federal (same day) funds or by
certified or bank cashier’s check(s) in New York Clearing House funds, payable
as follows: approximately $9.65 per Option Unit shall be deposited in the Trust
Fund pursuant to the Trust Agreement upon delivery to the Representative of
certificates (in form and substance satisfactory to the Underwriters)
representing the Option Units (or through the facilities of DTC) for the account
of the Underwriters. The certificates representing the Option Units to be
delivered will be in such denominations and registered in such names as the
Representative requests not less than two full busi-ness days prior to the
Closing Date or the Option Closing Date, as the case may be, and will be made
available to the Representative for inspection, checking and packaging at the
aforesaid office of the Company’s transfer agent or correspondent not less than
one full business day prior to such Closing Date.
2
2. Representations
and Warranties of the Company.
The
Company represents and warrants to the Underwriters as follows:
2.1 Filing
of Registration Statement.
2.1.1 Pursuant
to the Act.
The
Company has filed with the Securities and Exchange Commission (“Commission”) a
regis-tration statement and an amendment or amendments thereto, on Form S-1
(File No. 333-146899), including any related preliminary prospectus
(“Preliminary Prospectus”), for the registration of the Public Securities under
the Securities Act of 1933, as amended (“Act”), which registration statement and
amendment or amendments have been prepared by the Company in conformity with
the
requirements of the Act, and the rules and regulations (“Regulations”) of the
Commission under the Act. Except as the context may other-wise require, such
registration statement, as amended, on file with the Commission at the time
the
registration statement becomes effective (including the prospectus, financial
statements, schedules, exhibits and all other documents filed as a part thereof
or incorporated therein and all information deemed to be a part thereof as
of
such time pursuant to paragraph (b) of Rule 430A of the Regulations), is
hereinafter called the “Registration State-ment,” and the form of the final
prospectus dated the Effective Date included in the Registration Statement
(or,
if applicable, the form of final prospectus filed with the Commission pursuant
to Rule 424 of the Regulations), is here-inafter called the “Prospectus.” The
Registration Statement has been declared effective by the Commission on the
date
hereof.
2.1.2 Pursuant
to the Exchange Act.
The
Company has filed with the Commission a Form 8-A (File
Number 001-___________) providing for the registration under the Securities
Exchange Act of 1934, as amended (“Exchange Act”), of the Units, the Common
Stock and the Warrants. The registration of the Units, Common Stock and Warrants
under the Exchange Act has been declared effective by the Commission on the
date
hereof.
2.2 Pricing
Disclosure Package.
The
Pricing Disclosure Package (as hereinafter defined) did not, as of the date
hereof, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided
that no
representation or warranty is made as to information contained in or omitted
from the Pricing Disclosure Package in reliance upon and in conformity with
written information furnished to the Company through the Representative by
or on
behalf of any Underwriter specifically for inclusion therein, which information
is specified in Section 5.1. As used in this Agreement, “Pricing Disclosure
Package” means, as of the date hereof, the most recent Preliminary
Prospectus.
2.3 No
Stop Orders, Etc.
Neither
the Commission nor, to the best of the Company’s knowledge, any state regulatory
authority has issued any order or threatened to issue any order preventing
or
suspending the use of any Preliminary Prospectus, or has instituted or, to
the
best of the Company’s knowledge, threatened to institute any proceedings with
respect to such an order.
3
2.4 Disclosures
in Registration Statement.
2.4.1 10b-5
Representation.
At the
time the Regis-tration Statement became effective and at all times subsequent
thereto up to the Closing Date and the Option Closing Date, if any, the
Registration Statement and the Prospectus does and will contain all material
statements that are required to be stated therein in accordance with the Act
and
the Regulations, and will in all material respects conform to the requirements
of the Act and the Regulations; neither the Registration Statement, the Pricing
Disclosure Package, nor the Prospectus, nor any amendment or supplement thereto,
on such dates, does or will con-tain any untrue statement of a material fact
or
omit to state any material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading. When any Preliminary Prospectus was first filed with
the
Commission (whether filed as part of the Registration Statement for the
registration of the Public Securities or any amendment thereto or pursuant
to
Rule 424(a) of the Regula-tions) and when any amendment thereof or supplement
thereto was first filed with the Commission, such Preliminary Prospectus and
any
amendments thereof and supplements thereto complied or will comply in all
material respects with the applicable provisions of the Act and the Regulations
and did not and will not contain an untrue statement of a material fact or
omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading. The representation and warranty made in this Section
2.4.1 does not apply to statements made or statements omitted in reliance upon
and in conformity with written information furnished to the Company with respect
to the Under-writers by the Representative expressly for use in the Registration
Statement or Prospectus or any amendment thereof or supplement
thereto.
2.4.2 Disclosure
of Agreements.
The
agreements and documents described in the Registration Statement and the
Prospectus conform to the descriptions thereof contained therein and there
are
no agreements or other documents required to be described in the Registration
Statement or the Prospectus or to be filed with the Commission as exhibits
to
the Registration Statement, that have not been so described or filed. Each
agreement or other instrument (however characterized or described) to which
the
Company is a party or by which its property or business is or may be bound
or
affected and (i) that is referred to in the Pro-spectus, or (ii) is material
to
the Company’s business, has been duly and validly executed by the Company, is in
full force and effect and is enforceable against the Company and, to the
Company’s knowledge, the other parties thereto, in accordance with its terms,
except (x) as such enforce-ability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally, (y) as
enforceability of any indemnification or contribution provision may be limited
under the federal and state securities laws, and (z) that the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to
the equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought, and none of such agreements or instru-ments
has been assigned by the Company, and neither the Company nor, to the best
of
the Company’s knowledge, any other party is in breach or default thereunder, and
to the best of the Company’s knowledge, no event has occurred that, with the
lapse of time or the giving of notice, or both, would constitute a breach or
default thereunder. To the best of the Company’s knowledge, performance by the
Company of the material provisions of such agreements or instruments will not
result in a violation of any existing applicable law, rule, regulation,
judgment, order or decree of any governmental agency or court, domestic or
foreign, having jurisdiction over the Company or any of its assets or
businesses, including, without limitation, those relating to environmental
laws
and regulations.
2.4.3 Prior
Securities Transactions.
No
securities of the Company have been sold by the Company or by or on behalf
of,
or for the benefit of, any person or persons controlling, con-trolled by, or
under common control with the Company since the Company’s formation, except as
disclosed in the Registration Statement.
2.4.4 Regulations.
The
disclosures in the Registration Statement concerning the effects of Federal,
State and local regulation on the Company's business as currently contemplated
are correct in all material respects and do not omit to state a material
fact.
4
2.5 Changes
After Dates in Registration Statement.
2.5.1 No
Material Adverse Change.
Since
the respective dates as of which information is given in the Registration
Statement, the Pricing Disclosure Package and the Prospectus, except as
otherwise specifically stated therein, (i) there has been no material adverse
change in the condition, financial or otherwise, or business prospects of the
Company, (ii) there have been no material transactions entered into by the
Company, other than as contemplated pursuant to this Agreement, and (iii) no
member of the Company’s management or board of directors has resigned from any
position with the Company.
2.5.2 Recent
Securities Transactions, Etc.
Subsequent to the respective dates as of which information is given in the
Registration Statement, the Pricing Disclosure Package and the Prospectus,
and
except as may otherwise be indicated or contemplated herein or therein, the
Company has not (i) issued any securities or incurred any liability or
obligation, direct or contingent, including, without limitation, those for
borrowed money; or (ii) declared or paid any dividend or made any other
distribution on or in respect to its equity securities.
2.6 Independent
Accountants.
BDO
Xxxxxxx, LLP (“BDO”), whose report is filed with the Commission as part of the
Registra-tion Statement, are independent accountants as required by the Act
and
the Regulations. BDO has not, during the periods covered by the financial
statements included in the Prospectus, provided to the Company any non-audit
services, as such term is used in Section 10A(g) of the Exchange
Act.
2.7 Financial
Statements.
The
financial statements, including the notes thereto and supporting schedules
included in the Registration Statement and Prospectus fairly present the
xxxxx-cial position, the results of operations and the cash flows of the Company
at the dates and for the periods to which they apply; and such financial
statements have been prepared in conformity with generally accepted accounting
principles, consistently applied throughout the periods involved; and the
supporting schedules included in the Registration Statement present fairly
the
information required to be stated therein. The summary financial data included
in the Registration Statement and the Prospectus present fairly the information
shown thereon and have been compiled on a basis consistent with the audited
financial statements presented therein. No other financial statements or
schedules are required to be included in the Registration Statement or the
Prospectus. The Registration Statement discloses all material off-balance sheet
transactions, arrangements, obligations (including contingent obligations),
and
other relationships of the Company with unconsolidated entities or other persons
that may have a material current or future effect on the Company’s financial
condition, changes in financial condition, results of operations, liquidity,
capital expenditures, capital resources, or significant components of revenues
or expenses.
2.8 Authorized
Capital; Options; Etc.
The
Company had at the date or dates indicated in the Prospectus duly authorized,
issued and outstanding capitalization as set forth in the Registration Statement
and the Prospectus. Based on the assumptions stated in the Registration
Statement and the Prospectus, the Company will have on the Closing Date the
adjusted stock capitalization set forth therein. Except as set forth in, or
contemplated by, the Registration Statement and the Prospectus, on the Effective
Date and on the Closing Date, there will be no options, warrants, or other
rights to purchase or otherwise acquire any authorized but unissued shares
of
Common Stock of the Company or any security convertible into shares of Common
Stock of the Company, or any contracts or commitments to issue or sell shares
of
Common Stock or any such options, warrants, rights or convertible
securities.
5
2.9 Valid
Issuance of Securities; Etc.
2.9.1 Outstanding
Securities.
All
issued and outstanding securities of the Company have been duly authorized
and
validly issued and are fully paid and non-assessable; the holders thereof have
no rights of rescission with respect thereto, and are not subject to personal
liability by reason of being such holders; and none of such securities were
issued in violation of the pre-emptive rights of any holders of any security
of
the Company or similar contractual rights granted by the Company. The authorized
Common Stock conforms to all statements relating thereto contained in the
Regis-tration Statement and the Prospectus. The offers and sales of the
outstanding Common Stock were at all relevant times either registered under
the
Act and the applicable state securities or Blue Sky laws or, based in part
on
the representations and warranties of the purchasers of such shares of Common
Stock, properly exempt from such registration requirements.
2.9.2 Securities
Sold Pursuant to this Agreement.
The
Public Securities have been duly authorized and, when issued and paid for,
will
be validly issued, fully paid and non-assessable; the holders thereof are not
and will not be subject to personal lia-bility by reason of being such holders;
the Public Securities are not and will not be subject to the preemptive rights
of any holders of any security of the Company or similar contractual rights
granted by the Company; and all corporate action required to be taken for the
authorization, issuance and sale of the Public Securities has been duly and
validly taken. The Securities conform in all material respects to all statements
with respect thereto contained in the Registration Statement. When issued,
the
Warrants will constitute valid and binding obligations of the Company to issue
and sell, upon exercise thereof and payment of the exercise price therefor,
the
number and type of securities of the Company called for thereby in accordance
with the terms thereof and the Warrants are enforceable against the Company
in
accordance with their respective terms, except (i) as such enforce-ability
may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally, (ii) as enforceability of any indemnification or
contribution provision may be limited under the federal and state securities
laws, and (iii) that the remedy of specific performance and injunctive and
other
forms of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought.
2.9.3 Insider
Securities.
Fortune
Management, Inc. (“Fortune Management”) has
committed
to purchase 7,825,000 Warrants (“Insider Warrants” and together with the shares
of Common Stock underlying the Insider Warrants, collectively referred to as
the
“Insider Securities”) at $1.00 per Warrant (for an aggregate purchase price of
$7,825,000) from the Company upon consummation of the Offering. The Insider
Securities have been duly authorized and, when issued and paid for in accordance
with the subscription agreement (“Subscription Agreement”) entered into by
Fortune Management to purchase such Insider Securities, will be validly issued,
fully paid and non-assessable; the holder thereof is not and will not be subject
to personal liability by reason of being such holder; the Insider Securities
are
not and will not be subject to the preemptive rights of any holders of any
security of the Company or similar contractual rights granted by the Company;
and all corporate action required to be taken for the authorization, issuance
and sale of the Insider Securities has been duly and validly taken. The
Subscription Agreement provides that Fortune Management will not sell any of
its
Insider Warrants until the consummation of a Business Combination.
2.10 Registration
Rights of Third Parties.
Except
as set forth in the Prospectus, no holders of any securities of the Company
or
any rights exercisable for or convertible or exchangeable into securities of
the
Company have the right to require the Company to register any such securities
of
the Company under the Act or to include any such securities in a registration
statement to be filed by the Company.
2.11 Validity
and Binding Effect of Agreements.
This
Agreement, the Warrant Agreement (as defined in Section 2.23 hereof), the Trust
Agreement, the Services Agreement (as defined in Section 3.7.2 hereof), the
Subscription Agreement and the Escrow Agreement (as defined in
Section 2.24.2 hereof) have been duly and validly authorized by the Company
and constitute, the valid and binding agreements of the Company, enforceable
against the Company in accordance with their respective terms, except (i) as
such enforceability may be limited by bankruptcy, insolvency, reorganization
or
similar laws affecting creditors’ rights generally, (ii) as enforceability of
any indemnification or contribution provision may be limited under the federal
and state securities laws, and (iii) that the remedy of specific performance
and
injunctive and other forms of equitable relief may be subject to the equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought.
6
2.12 No
Conflicts, Etc.
The
execution, delivery, and performance by the Company of this Agreement, the
Warrant Agreement, the Trust Agreement, the Services Agreement, the Subscription
Agreement and the Escrow Agreement, the consummation by the Company of the
transactions herein and therein contemplated and the compliance by the Company
with the terms hereof and thereof do not and will not, with or without the
giving of notice or the lapse of time or both (i) result in a breach of, or
conflict with any of the terms and provisions of, or constitute a default under,
the terms of any agreement or instrument to which the Company is a party; (ii)
result in the creation, modification, termination or imposition of any lien,
charge or encumbrance upon any property or assets of the Company pursuant to
the
terms of any agreement or instrument to which the Company is a party except
pursuant to the Trust Agreement referred to in Section 1.1.2 hereof; (iii)
result in any violation of the pro-visions of the Certificate of Incorporation
or the Bylaws of the Company; or (iv) violate any existing applicable law,
rule,
regu-lation, judgment, order or decree of any governmental agency or court,
domestic or foreign, having jurisdiction over the Company or any of its
properties or business.
2.13 No
Defaults; Violations.
No
material default exists in the due performance and observance of any term,
covenant or condition of any material license, contract, indenture, mortgage,
deed of trust, note, loan or credit agreement, or any other agreement or
instrument evidencing an obligation for borrowed money, or any other material
agreement or instrument to which the Company is a party or by which the Company
may be bound or to which any of the properties or assets of the Company is
subject. The Company is not in violation of any term or provision of its
Certificate of Incorporation or Bylaws or in violation of any material
franchise, license, permit, applicable law, rule, regulation, judgment or decree
of any governmental agency or court, domestic or foreign, having jurisdiction
over the Company or any of its properties or businesses.
2.14 Corporate
Power; Licenses; Consents.
2.14.1 Conduct
of Business.
The
Company has all requisite corporate power and authority, and has all necessary
authorizations, approvals, orders, licenses, certificates and permits of and
from all governmental regulatory officials and bodies that it needs as of the
date hereof to conduct its business purpose as described in the Prospectus.
The
disclosures in the Registration Statement concerning the effects of federal,
state and local regulation on this offering and the Company’s business purpose
as currently contemplated are correct in all material respects and do not omit
to state a material fact required to be stated therein or necessary in order
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading.
2.14.2 Transactions
Contemplated Herein.
The
Company has all corporate power and authority to enter into this Agreement
and
to carry out the provisions and conditions hereof, and all con-sents,
authorizations, approvals and orders required in connection therewith have
been
obtained. No consent, authorization or order of, and no filing with, any court,
government agency or other body is required for the valid issuance, sale and
delivery, of the Public Securities and the consummation of the transactions
and
agreements contemplated by this Agreement, the Warrant Agreement, the Trust
Agreement and the Escrow Agreement and as contemplated by the Prospectus, except
with respect to applicable federal and state securities laws.
7
2.15 D&O
Questionnaires.
To the
best of the Company’s knowledge, all information contained in the questionnaires
(“Questionnaires”) completed by each
of
the Company’s stockholders immediately prior to the Offering (the “Initial
Stockholders”) and
provided to the Underwriters as exhibits to his, her or its Insider Letter
(as
defined in Section 2.24.1) is true and correct and the Company has not become
aware of any information which would cause the information disclosed in the
questionnaires completed by each Initial Stockholder to become inaccurate and
incorrect.
2.16 Litigation;
Governmental Proceedings.
There
is no action, suit, proceeding, inquiry, arbitration, investigation, litigation
or governmental proceeding pending or, to the best of the Company’s knowledge,
threatened against, or involving the Company or, to the best of the Company’s
knowledge, any Initial Stockholder, which has not been disclosed in the
Registration Statement or the Questionnaires.
2.17 Good
Standing.
The
Company has been duly organized and is validly existing as a corporation and
is
in good standing under the laws of its state of incorporation, and is duly
qualified to do business and is in good standing as a foreign corporation in
each jurisdiction in which its ownership or lease of property or the conduct
of
business requires such qualification, except where the failure to qualify would
not have a material adverse effect on the assets, business or operations of
the
Company.
2.18 Stop
Orders.
The
Commission has not issued any order preventing or suspending the use of any
Preliminary Prospectus or Prospectus or any part thereof and has not threatened
to issue any such order.
2.19 Transactions
Affecting Disclosure to FINRA.
2.19.1 Finder’s
Fees.
Except
as described in the Prospectus, there are no claims, payments, arrangements,
agreements or understandings relating to the payment of a finder’s, consulting
or origina-tion fee by the Company or any Initial Stockholder with respect
to
the sale of the Public Securities hereunder or any other arrangements,
agreements or understandings of the Company or, to the best of the Company’s
knowledge, any Initial Stockholder that may affect the Under-writers’
compensation, as determined by the Financial Industry Regulatory Authority
(“FINRA”).
2.19.2 Payments
Within Twelve Months.
Other
than payments to EBC, the Company has not within the twelve months prior to
the
Effective Date made any direct or indirect payments (in cash, securities or
otherwise) (i) to any person, as a finder’s fee, consulting fee or otherwise, in
consideration of such person raising capital for the Company or introducing
to
the Company persons who raised or provided capital to the Company, (ii) to
any
FINRA member or (iii) to any person or entity that has any direct or
indirect affiliation or association with any FINRA member.
2.19.3 Use
of
Proceeds.
None of
the net proceeds of the Offering will be paid by the Company to any
participating FINRA member or its affiliates, except as specifically authorized
herein and except as may be paid in connection with a Business Combination
as
contemplated by the Prospectus.
2.19.4 Insiders’
FINRA Affiliation.
Based
on questionnaires distributed to such persons, except as set forth on
Schedule 2.18.4, no officer, director or any beneficial owner of the
Company’s unregistered securities has any direct or indirect affiliation or
association with any FINRA member. The Company will advise the Representative
and its counsel if it learns that any officer, director or owner of at least
5%
of the Company’s outstanding Common Stock is or becomes an affiliate or
associated person of a FINRA member participating in the offering.
8
2.20 Foreign
Corrupt Practices Act.
Neither
the Company nor any of the Initial Stockholders or any other person acting
on
behalf of the Company has, directly or indirectly, given or agreed to give
any
money, gift or similar benefit (other than legal price concessions to customers
in the ordinary course of business) to any customer, supplier, employee or
agent
of a customer or supplier, or official or employee of any governmental agency
or
instrumentality of any government (domestic or foreign) or any political party
or candidate for office (domestic or foreign) or any political party or
candidate for office (domestic or foreign) or other person who was, is, or
may
be in a position to help or hinder the business of the Company (or assist it
in
connection with any actual or proposed transaction) that (i) might subject
the
Company to any damage or penalty in any civil, criminal or governmental
litigation or proceeding, (ii) if not given in the past, might have had a
material adverse effect on the assets, business or operations of the Company
as
reflected in any of the financial statements contained in the Prospectus or
(iii) if not continued in the future, might adversely affect the assets,
business, operations or prospects of the Company. The Company’s internal
accounting controls and procedures are sufficient to cause the Company to comply
with the Foreign Corrupt Practices Act of 1977, as amended.
2.21 OFAC
Sanctions.
Neither
the Company nor, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company, is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department.
2.22 Officers’
Certificate.
Any
certificate signed by any duly authorized officer of the Company and delivered
to the Representative or to the Representative’s counsel shall be deemed a
representation and warranty by the Company to the Underwriters as to the matters
covered thereby.
2.23 Warrant
Agreement.
The
Company has entered into a warrant agreement with respect to the Warrants and
the Insider Warrants with Continental Stock Transfer & Trust Company, New
York, New York, substantially in the form annexed as Exhibit 4.4 to the
Registration Statement (“Warrant Agreement”).
2.24 Agreements
With Initial Stockholders.
2.24.1 Insider
Letters.
The
Company has caused to be duly executed legally binding and enforceable
agreements (except (i) as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights
generally, (ii) as enforceability of any indemnification, contribution or
noncompete provision may be limited under the federal and state securities
laws,
and (iii) that the remedy of specific performance and injunctive and other
forms
of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought)
annexed as Exhibits 10.1 through 10.8 to the Registration Statement
(“Insider Letters”), pursuant to which each of the Initial Stockholders of the
Company agrees to certain matters, including but not limited to, certain matters
described as being agreed to by them under the “Proposed Business” section of
the Prospectus.
2.24.2 Escrow
Agreement.
The
Company has caused the Initial Stockholders to enter into an escrow agreement
(“Escrow Agreement”) with Continental Stock Transfer & Trust Company
(“Escrow Agent”) substantially in the form annexed as Exhibit 10.10 to
the
Registration Statement, whereby the Common Stock owned by the Initial
Stockholders will be held in escrow by the Escrow Agent, until one year after
the consummation of a Business Combination. During such escrow period, the
Initial Stockholders shall be prohibited from selling or otherwise transferring
such shares (except to spouses and children of Initial Stockholders and trusts
established for their benefit and as otherwise set forth in the Escrow
Agreement) but will retain the right to vote such shares. To the Company’s
knowledge, the Escrow Agreement is enforceable against each of the Initial
Stockholders and will not, with or without the giving of notice or the lapse
of
time or both, result in a breach of, or conflict with any of the terms and
provisions of, or constitute a default under, any agreement or instrument to
which any of the Initial Stockholders is a party. The Escrow Agreement shall
not
be amended, modified or otherwise changed without the prior written consent
of
EBC.
2.24.3 Subscription
Agreement.
The
Company has entered into the Subscription Agreement substantially in the form
annexed as Exhibit 10.13 to the Registration Statement with Fortune Management
to purchase the Insider Securities. Pursuant to the Subscription Agreement,
Fortune Management has placed the purchase price for the Insider Securities
in
escrow prior to the date hereof. Simultaneously with the consummation of the
Offering, such purchase price shall be deposited into the Trust Fund pursuant
to
the Trust Agreement.
9
2.25 Investment
Management Trust Agreement.
The
Company has entered into the Trust Agreement with respect to certain proceeds
of
the Offering substantially in the form annexed as Exhibit 10.9 to the
Registration Statement.
2.26 Covenants
Not to Compete.
No
Initial Stockholder, employee, officer or director of the Company is subject
to
any noncompetition agreement or non-solicitation agreement with any employer
or
prior employer which could materially affect his ability to be an Initial
Stockholder, employee, officer and/or director of the Company.
2.27 Investment
Company Act; Investments.
The
Company has been advised concerning the Investment Company Act of 1940, as
amended (the “Investment Company Act”), and the rules and regulations thereunder
and has in the past conducted, and intends in the future to conduct, its affairs
in such a manner as to ensure that it will not become an “investment company” or
a company “controlled” by an “investment company” within the meaning of the
Investment Company Act and such rules and regulations. The Company is not,
nor
will the Company become upon the sale of the Units and the application of the
proceeds therefore as described in the Prospectus under the caption “Use of
Proceeds,” an “investment company” or a person controlled by an “investment
company” within the meaning of the Investment Company Act. No
more
than 45% of the “value” (as defined in Section 2(a)(41) of the Investment
Company Act) of the Company’s total assets (exclusive of cash items and
“Government Securities” (as defined in Section 2(a)(16) of the Investment
Company Act) consist of, and no more than 45% of the Company’s net income after
taxes is derived from, securities other than the Government
Securities.
2.28 Subsidiaries.
The
Company does not own an interest in any corporation, partnership, limited
liability company, joint venture, trust or other business entity.
2.29 Related
Party Transactions.
There
are no business relationships or related party transactions involving the
Company or any other person required to be described in the Prospectus that
have
not been described as required. There are no outstanding loans, advances (except
normal advances for business expenses in the ordinary course of business) or
guarantees of indebtedness by the Company to or for the benefit of any of the
officers or directors or Initial Stockholders of the Company or any of the
members of the families of any of them, except as disclosed in the Registration
Statement and the Prospectus.
2.30 No
Distribution of Offering Material.
The
Company has not distributed and will not distribute prior to the Closing Date
any offering material in connection with the offering and sale of the Units
other than any Preliminary Prospectuses, the Prospectus, the Registration
Statement and other materials, if any, permitted by the Act.
2.31 Title
to Assets.
Except
as set forth in the Registration Statement and Prospectus, the Company has
good
and marketable title to all properties and assets described in the Registration
Statement and Prospectus as owned by it, free and clear of any pledge, lien,
security interest, encumbrances, claim or equitable interest, other than such
as
would not have a material adverse effect on the financial condition, earnings,
operations, business or business prospects of the Company.
10
2.32 Taxes.
The
Company has timely filed all necessary federal, state and foreign income and
franchise tax returns and has paid all taxes shown thereon as due, and there
is
no tax deficiency that has been or, to the best of the Company’s knowledge,
might be asserted against the Company that might have a material adverse effect
on the financial condition, earnings, operations, business or business prospects
of the Company, and all material tax liabilities are adequately provided for
on
the books of the Company.
3. Covenants
of the Company.
The
Company covenants and agrees as follows:
3.1 Amendments
to Registration Statement.
The
Company will deliver to the Representative, prior to filing, any amendment
or
supplement to the Registration Statement or Prospectus proposed to be filed
after the Effective Date and not file any such amendment or supplement to which
the Representative shall reasonably object in writing.
3.2 Federal
Securities Laws.
3.2.1 Compliance.
During
the time when a Prospectus (or, in lieu thereof, the notice referred to under
Rule 173(a) of the Act) is required to be delivered under the Act, the Company
will comply with all require-ments imposed upon it by the Act, the Regulations
and the Exchange Act and by the regulations under the Exchange Act, as from
time
to time in force, so far as necessary to permit the continuance of sales of
or
dealings in the Public Securities in accordance with the provisions hereof
and
the Prospectus. If at any time when a Prospectus relating to the Public
Securities is required to be delivered under the Act, any event shall have
occurred as a result of which, in the opinion of counsel for the Company or
counsel for the Underwriters, the Prospectus, as then amended or supple-mented,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, or
if
it is necessary at any time to amend the Prospectus to comply with the Act,
the
Company will notify the Representative promptly and prepare and file with the
Commission, subject to Section 3.1 hereof, an appropriate amendment or
supplement in accordance with Section 10 of the Act.
3.2.2 Filing
of Final Prospectus.
The
Company will file the Prospectus (in form and substance satisfactory to the
Representative) with the Commission pursuant to the requirements of Rule 424
of
the Regulations and notify the Representative immediately upon
filing.
3.2.3 Exchange
Act Registration.
The
Company will use its best efforts to maintain the registration of the Units,
Common Stock and Warrants under the provisions of the Exchange Act for a period
of five years from the Effective Date, or until the Company is required to
be
liquidated, if earlier or, in the case of the Warrants, until the Warrants
expire and are no longer exercisable. The Company will not deregister the Units
under the Exchange Act without the prior written consent of EBC.
3.2.4 Ineligible
Issuer.
At the
time of filing the Registration Statement and at the date hereof, the Company
was and is an “ineligible issuer,” as defined in Rule 405 under the Securities
Act. The Company has not made and will not make any offer relating to the Public
Securities that would constitute an “issuer free writing prospectus,” as defined
in Rule 433, or that would otherwise constitute a “free writing prospectus,” as
defined in Rule 405.
11
3.3 Blue
Sky Filings.
The
Company will use its best efforts, in cooperation with the Representative,
at or
prior to the time the Registration Statement becomes effective, to qualify
the
Public Securities for offering and sale under the securities laws of such
jurisdictions as the Representative may reasonably desig-nate, provided
that no
such qualification shall be required in any jurisdiction where, as a result
thereof, the Company would be sub-ject to service of general process or to
taxation as a foreign corporation doing business in such jurisdiction. In each
juris-diction where such qualification shall be effected, the Company will,
unless the Representative agrees that such action is not at the time necessary
or advisable, use its best efforts to file and make such statements or reports
at such times as are or may be required by the laws of such
jurisdiction.
3.4 Delivery
to Underwriters of Prospectuses.
The
Company will deliver to each of the several Underwriters, without charge, from
time to time during the period when the Prospectus is required to be delivered
under the Act or the Exchange Act, such number of copies of each Preliminary
Prospectus and the Prospectus as such Underwriters may reasonably request and,
as soon as the Registra-tion Statement or any amendment or supplement thereto
becomes effective, deliver to the Representative two original executed
Registration Statements, including exhibits, and all post-effective amendments
thereto and copies of all exhibits filed therewith or incorporated therein
by
reference and all original executed consents of certified experts.
3.5 Effectiveness
and Events Requiring Notice to the Representative.
The
Company will use its best efforts to cause the Registration Statement to remain
effective and will notify the Representative immediately and confirm the notice
in writing (i) of the effectiveness of the Registration Statement and any
amendment thereto, (ii) of the issuance by the Commission of any stop order
or
of the initiation, or the threatening, of any proceeding for that purpose,
(iii)
of the issuance by any state securities commis-sion of any proceedings for
the
suspension of the qualification of the Public Securities for offering or sale
in
any jurisdiction or of the initiation, or the threatening, of any proceeding
for
that purpose, (iv) of the mailing and delivery to the Commission for filing
of
any amendment or supplement to the Registration Statement or Prospectus, (v)
of
the receipt of any comments or request for any additional information from
the
Commission, and (vi) of the happening of any event during the period described
in Section 3.4 hereof that, in the judgment of the Company, makes any statement
of a material fact made in the Registration Statement or the Prospectus untrue
or that requires the making of any changes in the Registration Statement or
the
Prospectus in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. If the Commission
or
any state securities commission shall enter a stop order or suspend such
qualification at any time, the Company will use commercially reasonable effort
to obtain promptly the lifting of such order.
3.6 Review
of Financial Statements.
Until
the earlier of five years from the Effective Date, or until such earlier time
upon which the Company is required to be liquidated, the Company, at its
expense, shall cause its regularly engaged independent certified public
accountants to review (but not audit) the Company’s financial statements for
each of the first three fiscal quarters prior to the announcement of quarterly
financial information, the filing of the Company’s Form 10-Q quarterly report
and the mailing of quarterly financial information to stockholders.
3.7 Affiliated
Transactions.
3.7.1 Business
Combinations.
The
Company will not consummate a Business Combination with any entity which is
affiliated with any Initial Stockholder unless the Company obtains an opinion
from an independent investment banking firm that the Business Combination is
fair to the Company’s stockholders from a financial perspective.
3.7.2 Administrative
Services.
The
Company has entered into an agreement (“Services Agreement”) with Fortune
Management substantially in the form annexed as Exhibit 10.14 to the
Registration Statement pursuant to which the Affiliate will make available
to
the Company general and administrative services including office space,
utilities and secretarial support for the Company’s use for $7,500 per month.
3.7.3 Compensation.
Except
as set forth above in this Section 3.7, the Company shall not pay any Initial
Stockholder or any of their affiliates any fees or compensation from the
Company, for services rendered to the Company prior to, or in connection with,
the consummation of a Business Combination; provided
that (i)
the Initial Stockholders shall be entitled to reimbursement from the Company
for
their reasonable out-of-pocket expenses incurred in connection with seeking
and
consummating a Business Combination and (ii) Fortune Management shall be
entitled to repayment, without interest, of its loan to the Company of, as
described in the Prospectus.
12
3.8 American
Stock Exchange.
The
Company will use best efforts to effect and maintain a listing of the Units
and
the Common Stock and Warrants underlying the Units on the American Stock
Exchange until the consummation of a Business Combination.
3.9 Secondary
Market Trading and Standard & Poor’s.
The
Company will apply to be included in Standard & Poor’s Daily News and
Corporation Records Corporate Descriptions for a period of five years from
the
consummation of a Business Combination. Promptly after the consummation of
the
Offering, the Company shall take such steps as may be necessary to obtain a
secondary market trading exemption for the Company’s securities in the State of
California. The Company shall also take such other action as may be reasonably
requested by the Representative to obtain a secondary market trading exemption
in such other states as may be requested by the Representative.
3.10 Financial
Public Relations Firm.
Promptly after the execution of a definitive agreement for a Business
Combination, the Company shall retain a financial public relations
firm.
3.11 Reports
to the Representative.
3.11.1 Periodic
Reports, Etc.
For a
period of five years from the Effective Date or until such earlier time upon
which the Company is required to be liquidated, the Company will furnish to
the
Representative (Attn: Xxxxxx Xxxxxx, President and Managing Director of
Investment Banking) and its counsel copies of such financial statements and
other periodic and special reports as the Company from time to time furnishes
generally to holders of any class of its securities, and promptly furnish to
the
Representative (i) a copy of each periodic report the Company shall be required
to file with the Commission, (ii) a copy of every press release and every news
item and article with respect to the Company or its affairs which was released
by the Company, (iii) a copy of each Form 8-K or Schedules 13D, 13G, 14D-1
or 13E-4 received or prepared by the Company, (iv) five copies of each
registration statement filed by the Company with the Commission under the
Securities Act, (v) a copy of monthly statements, if any, setting forth such
information regarding the Company’s results of operations and financial position
(including balance sheet, profit and loss statements and data regarding
outstanding purchase orders) as is regularly prepared by management of the
Company and (vi) such additional documents and information with respect to
the Company and the affairs of any future subsidiaries of the Company as the
Representative may from time to time reasonably request.
3.11.2 Secondary
Market Trading Survey.
Until
such time as the Public Securities are listed or quoted, as the case may be,
on
the New York Stock Exchange, the American Stock Exchange or the Nasdaq Stock
Market LLC, or until such earlier time upon which the Company is required to
be
liquidated, the Company shall engage Xxxxxxxx Xxxxxx (“GM”), for a one-time fee
of $5,000 payable on the Closing Date, to deliver and update to the
Representative on a timely basis, but in any event on the Effective Date and
at
the beginning of each fiscal quarter, a written report detailing those states
in
which the Public Securities may be traded in non-issuer transactions under
the
Blue Sky laws of the fifty States (“Secondary Market Trading
Survey”).
13
3.12 Disqualification
of Form S-1.
Until
the earlier of seven years from the date hereof or until the Warrants have
expired and are no longer exercisable, the Company will not take any action
or
actions which may prevent or disqualify the Company’s use of Form S-1 (or other
appropriate form) for the registration of the Warrants under the
Act.
3.13 Payment
of Expenses.
3.13.1 General
Expenses Related to the Offering.
The
Company hereby agrees to pay on each of the Closing Date and the Option Closing
Date, if any, to the extent not paid at Closing Date, all expenses incident
to
the performance of the obligations of the Company under this Agreement,
including but not limited to:
(i) the
preparation, print-ing, filing and mailing (including the payment of postage
with respect to such mailing) of the Registration Statement, the Preliminary
and
Final Prospectuses and the printing and mailing of this Agreement and related
documents, including the cost of all copies thereof and any amendments and
post-effective amendments thereof or supplements thereto supplied to the
Underwriters in quantities as may be required by the Underwriters;
(ii) the
preparing, printing, engraving, issuance and delivery of the Units, the shares
of Common Stock and the Warrants included in the Units, including any transfer
or other taxes payable thereon;
(iii) the
qualification of the Public Securities under state or foreign securities or
Blue
Sky laws, including, in the event that the Public Securities are not approved
for listed on the American Stock Exchange at the time of this Agreement, the
costs of printing and mailing the “Preliminary Blue Sky Memorandum,” and all
amendments and supplements thereto, fees and disbursements of counsel handling
“blue sky” matters;
(iv) filing
fees, costs and expenses incurred in registering the Offering with FINRA
(including fees and disbursements of the Representative’s counsel, Drinker
Xxxxxx & Xxxxx LLP;
(v) costs
and
expenses of listing the securities on the American Stock Exchange;
(vi) fees
and
disbursements of the transfer and warrant agent and registrar fees, (vii) the
Company’s expenses associated with “due diligence” meetings arranged by the
Representative;
(vii) the
preparation, binding and delivery of transaction “bibles,” in form and style
reasonably satisfactory to the Representative and transaction lucite cubes
or
similar commemorative items in a style and quantity as reasonably requested
by
the Representative; and
(viii) all
other
costs and expenses customarily borne by an issuer incident to the performance
of
its obligations hereunder which are not otherwise specifically provided for
in
this Section 3.13.1.
14
3.13.2 Investigative
Search Firm Expenses.
The
Company also agrees that, if requested by the Representative, it will engage
and
pay for an investigative search firm of the Representative’s choice to conduct
an investigation of the principals of the Company as shall be mutually selected
by the Representative and the Company.
3.13.3 Reimbursement
of Expenses.
(i) Deduction
from Offering Proceeds.
The
Representative may deduct from the net proceeds of the Offering payable to
the
Company on the Closing Date, or the Option Closing Date, if any, the expenses
set forth in this Agreement to be paid by the Company to the Representative
and
others. To the extent the Representative pays for expenses required to be paid
by the Company pursuant to Section 3.13.1, Company shall reimburse
Representative for such out-of-pocket expenses.
(ii) Offering
Not Consummated.
If the
Offering contemplated by this Agreement is not consummated for any reason other
than a Company Failure (as hereinafter defined), then the Company shall
reimburse the Underwriters in full for their out of pocket expenses, including,
without limitation, its legal fees and disbursements only
up
to the amounts previously paid as deposits against commissions (up
to a
maximum of $50,000). The
Representative shall retain such part of the deposits against commissions
previously paid as shall equal its actual out-of-pocket expenses and refund
the
balance. If the Offering contemplated by this Agreement is not consummated
because the Company has materially breached any of its representations,
warranties or obligations under this Agreement, or failed to expeditiously
proceed with the Offering (each a “Company Failure”), the Company shall
reimburse the Representative in full for its legal fees and disbursements up
to
an aggregate of $100,000, less the amount of $50,000 to the extent previously
advanced to the Representative.
3.13.4 Deferred
Compensation.
Upon
the consummation of a Business Combination, the Company shall pay the
Underwriters the Deferred Discount. This payment shall be made by wire transfer
to an account designated by the Representative on the closing date of the
Business Combination.
3.14 Application
of Net Proceeds.
The
Company will apply the net proceeds from the Offering received by it in a manner
con-sistent with the application described under the caption “Use Of Proceeds”
in the Prospectus.
3.15 Delivery
of Earnings Statements to Security Holders.
The
Company will make generally available to its security holders as soon as
practicable, but not later than the first day of the fif-teenth full calendar
month following the Effective Date, an earn-ings statement (which need not
be
certified by independent public or independent certified public accountants
unless required by the Act or the Regulations, but which shall satisfy the
provisions of Rule 158(a) under Section 11(a) of the Act) covering a period
of
at least twelve consecutive months beginning after the Effective
Date.
3.16 Notice
to FINRA.
For a
period of ninety days following the Effective Date, in the event any person
or
entity (regardless of any FINRA affiliation or association) is engaged to assist
the Company in its search for a merger candidate or to provide any other merger
and acquisition services, the Company will provide the following to FINRA and
EBC prior to the consummation of the Business Combination: (i) complete
details of all services and copies of agreements governing such services (which
details or agreements may be appropriately redacted to account for privilege
or
confidentiality concerns); and (ii) justification as to why the person or
entity providing the merger and acquisition services should not be considered
an
“underwriter and related person” with respect to the Company’s initial public
offering, as such term is defined in Rule 2710 of FINRA’s NASD Conduct Rules.
The Company also agrees that proper disclosure of such arrangement or
potential arrangement will be made in the proxy statement which the Company
will
file for purposes of soliciting stockholder approval for the Business
Combination.
15
3.17 Stabilization.
Neither
the Company, nor, to its knowl-edge, any of its employees, directors or
stockholders (without the consent of EBC) has taken or will take, directly
or
indirectly, any action designed to or that has constituted or that might
reasonably be expected to cause or result in, under the Exchange Act, or
otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Units.
3.18 Internal
Controls.
The
Company will maintain a system of internal accounting controls suffi-cient
to
provide reasonable assurances that: (i) transactions are executed in accordance
with management’s general or specific authorization, (ii) transactions are
recorded as necessary in order to permit preparation of financial statements
in
accordance with generally accepted accounting principles and to maintain
account-ability for assets, (iii) access to assets is permitted only in
accordance with management’s general or specific authorization, and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
3.19 Accountants.
Until
the earlier of five years from the Effective Date or until such earlier time
upon which the Company is required to be liquidated, the Company shall retain
BDO or another independent public accountant.
3.20 Form
8-K.
The
Company shall, on the date hereof, retain its independent public accountants
to
audit the financial statements of the Company as of the Closing Date (“Audited
Financial Statements”) reflecting the receipt by the Company of the proceeds of
the initial public offering. As soon as the Audited Financial Statements become
available, the Company shall promptly file a Current Report on Form 8-K
with the Commission (but in no event later than four business days after the
Closing Date), which Report shall contain the Company’s Audited Financial
Statements.
3.21 FINRA.
The
Company shall advise FINRA if it is aware that any 5% or greater stockholder
of
the Company becomes an affiliate or associated person of a FINRA member
participating in the distribution of the Company’s Public
Securities.
3.22 Corporate
Proceedings.
All
corporate proceedings and other legal matters necessary to carry out the
provisions of this Agreement and the transactions contemplated hereby shall
have
been done to the reasonable satisfaction to counsel for the Underwriters.
3.23 Investment
Company.
The
Company shall cause a portion of the proceeds of the Offering to be held in
the
Trust Fund to be invested only as set forth in the Trust Agreement and as more
fully described in the Prospectus. The Company will otherwise conduct its
business in a manner so that it will not become subject to the Investment
Company Act. Furthermore, once the Company consummates a Business Combination,
it will be engaged in a business other than that of investing, reinvesting,
owning, holding or trading securities.
3.24 Business
Combination Announcement.
Within
five business days following the consummation by the Company of a Business
Combination, the Company shall cause an announcement (“Business Combination
Announcement”) to be placed, at its cost, in The
Wall Street Journal,
The
New York Times
and a
third publication to be selected by the Representative announcing the
consummation of the Business Combination and indicating that EBC was the
managing underwriter in the Offering. The Company shall supply the
Representative with a draft of the Business Combination Announcement and provide
the Representative with a reasonable opportunity to comment thereon. The Company
will not place the Business Combination Announcement without the final approval
of the Representative, which such approval will not be unreasonably withheld.
16
3.25 Colorado
Trust Filing.
In the
event the Public Securities are registered in the State of Colorado, the Company
will cause a Colorado Form ES to be filed with the Commissioner of the State
of
Colorado no less than 10 days prior to the distribution of the Trust Fund in
connection with a Business Combination and will do all things necessary to
comply with Section 00-00-000 and Rule 51-3.4 of the Colorado Securities
Act.
3.26 Insider
Securities.
3.26.1 Insider
Securities
Purchase Price.
On the
Closing Date, the purchase price to be paid for the Insider Securities by
Fortune Management shall be deposited in the Trust Fund.
3.26.2 Insider
Warrant Exercises.
The
Company hereby acknowledges and agrees that, if the Warrants are called for
redemption, so long as the Insider Warrants are held by Fortune Management
or
its affiliates, such Warrants shall be exercisable by the holder by surrendering
such Warrants for that number of shares of Common Stock equal to the quotient
obtained by dividing (x) the product of the number of shares of Common Stock
underlying the Warrants, multiplied by the difference between the Warrant Price
and the “Fair Market Value” (defined below) by (y) the Fair Market Value.
The
“Fair
Market Value” shall mean the average reported last sale price of the Common
Stock for the 10 trading days ending on the third business day prior to the
date
on which the notice of redemption is sent to the holder of the
Warrants.
3.27 Initial
Stockholder Ownership.
If the
Over-allotment Option is not exercised or is not exercised in full, then
promptly following the earlier to occur of the expiration or termination of
the
Over-allotment Option, the Company will cause Fortune Management to forfeit
and
return to the Company for cancellation shares of Common Stock in an aggregate
amount (up to 750,000 shares of Common Stock) sufficient to cause the Initial
Stockholders to maintain ownership, in the aggregate, of 20% of the outstanding
Common Stock after giving effect to the Offering and the exercise, if any,
of
the Over-allotment Option. For the avoidance of doubt, if the Over-allotment
Option is exercised in full, Fortune Management shall not be required to forfeit
any shares of Common Stock pursuant to this subsection.
4. Conditions
of
Underwriters’ Obligations.
The
obligations of the several Underwriters to purchase and pay for the Units,
as
provided herein, shall be subject to the continuing accuracy of the
representations and warranties of the Company as of the date hereof and as
of
each of the Closing Date and the Option Closing Date, if any, to the accuracy
of
the statements of officers of the Company made pursuant to the provisions hereof
and to the performance by the Company of its obligations hereunder and to the
following conditions:
4.1 Regulatory
Matters.
4.1.1 Effectiveness
of Registration Statement.
The
Registration Statement shall have become effective not later than 5:00 P.M.,
New
York time, on the date of this Agreement or such later date and time as shall
be
consented to in writing by the Representative, and, at each of the Closing
Date
and the Option Closing Date, no stop order suspending the effectiveness of
the
Registration Statement shall have been issued and no proceedings for the purpose
shall have been instituted or shall be pending or contemplated by the Commission
and any request on the part of the Commission for additional information shall
have been complied with to the reasonable satisfaction of Drinker Xxxxxx &
Xxxxx LLP, counsel to the Underwriters (“Drinker Xxxxxx”).
4.1.2 FINRA
Clearance.
By the
Effective Date, the Representative shall have received clearance from FINRA
as
to the amount of compensation allowable or payable to the Underwriters as
described in the Registration Statement.
4.1.3 No
Blue Sky Stop Orders.
No
order suspending the sale of the Units in any jurisdiction designated by the
Representative pursuant to Section 3.3 hereof shall have been issued on either
on the Closing Date or the Option Closing Date, and no proceedings for that
purpose shall have been instituted or shall be contemplated.
17
4.2 Company
Counsel Matters.
4.2.1 Effective
Date Opinion of Counsel.
On the
Effective Date, the Representative shall have received the favor-able opinion
of
GM, counsel to the Company, dated the Effective Date, addressed to the
Representative and in form and substance satisfactory to Drinker Xxxxxx to
the
effect that:
(i) The
Company has been duly organized and is validly existing as a corporation and
is
in good standing under the laws of its state of incorporation. The Company
is
duly qualified and licensed and in good standing as a foreign corporation in
each jurisdiction in which its ownership or leasing of any properties or the
character of its operations requires such qualification or licensing, except
where the failure to qualify would not have a material adverse effect on the
assets, business or operations of the Company. To such counsel’s knowledge, the
Company is not in violation of any term or provision of its Certificate of
Incorporation or Bylaws.
(ii) All
issued and outstanding securities of the Company have been duly authorized
and
validly issued and are fully paid and non-assessable; the holders thereof are
not subject to personal liability by reason of being such holders; and none
of
such securities were issued in violation of the preemptive rights of any
stockholder of the Company arising by operation of law or under the Certificate
of Incorporation or Bylaws of the Company. The offers and sales of the
out-standing Common Stock were at all relevant times either registered under
the
Act or exempt from such registration requirements. The authorized and, to such
counsel’s knowledge, outstanding capital stock of the Company is as set forth in
the Prospectus.
(iii) The
Public Securities and Insider Securities have been duly authorized and, when
issued and paid for, will be validly issued, fully paid and non-assessable;
the
holders thereof are not and will not be subject to personal liability by reason
of being such holders. The Public Securities and Insider Securities are not
and
will not be subject to the preemptive rights of any holders of any security
of
the Company arising by operation of law or under the Certificate of
Incorporation or Bylaws of the Company. When issued, the Insider Warrants and
the Warrants will constitute valid and binding obligations of the Company to
issue and sell, upon exercise thereof and payment therefor, the number and
type
of securities of the Company called for thereby and such Warrants and Insider
Warrants, when issued, in each case, are enforceable against the Company in
accordance with their respective terms, except (a) as such enforceability may
be
limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally, (b) as enforceability of any indemni-fication or
contribution provision may be limited under the federal and state securities
laws, and (c) that the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
The
certificates representing the Public Securities are in due and proper
form.
(iv) This
Agreement, the Warrant Agreement, the Services Agreement, the Trust Agreement,
the Subscription Agreement and the Escrow Agreement have each been duly and
validly authorized and, when executed and delivered by the Company, constitute
the valid and binding obligations of the Company, enforceable against the
Company in accordance with their respective terms, except (a) as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws affecting creditors’ rights generally, (b) as enforceability of any
indemnification or contribution provisions may be limited under the federal
and
state securities laws, and (c) that the remedy of specific performance and
injunc-tive and other forms of equitable relief may be subject to the equitable
defenses and to the discretion of the court before which any proceeding therefor
may be brought.
18
(v) The
execution, delivery and performance of this Agreement, the Warrant Agreement,
the Escrow Agreement, the Trust Agreement, the Subscription Agreements and
the
Services Agreement and compliance by the Company with the terms and provisions
thereof and the consummation of the transactions contemplated thereby, and
the
issuance and sale of the Public Securities, do not and will not, with or without
the giving of notice or the lapse of time, or both, (a) to such counsel’s
knowledge, conflict with, or result in a breach of, any of the terms or
provisions of, or constitute a default under, or result in the creation or
modification of any lien, security interest, charge or encumbrance upon any
of
the properties or assets of the Company pursuant to the terms of, any mortgage,
deed of trust, note, indenture, loan, contract, commitment or other agreement
or
instrument filed as an exhibit to the Registration Statement, (b) result in
any
violation of the provisions of the Certificate of Incorporation or the Bylaws
of
the Company, or (c) to such counsel’s knowledge, violate any United States
sta-tute or any judgment, order or decree, rule or regulation applica-ble to
the
Company of any court, United States federal, state or other regulatory authority
or other governmental body having jurisdiction over the Company, its properties
or assets, which is normally applicable to transactions of this
kind.
(vi) The
Registration Statement, the Preliminary Prospectus, the Pricing Disclosure
Package and the Prospectus, and any post-effective amendments or supplements
thereto (other than the financial statements included therein, as to which
no
opinion need be rendered) each as of their respective dates appeared on their
face to comply as to form in all material respects with the requirements of
the
Act and Regulations. The Public Securities and all other securities issued
or
issuable by the Company conform in all material respects to the description
thereof contained in the Registration Statement, the Pricing Disclosure Package
and the Prospectus. The descriptions in the Registration Statement, in the
Pricing Disclosure Package and in the Prospectus, insofar as such statements
constitute a summary of statutes, legal matters, contracts, documents or
proceedings referred to therein, fairly present in all material respects the
information required to be shown with respect to such statutes, legal matters,
contracts, documents and proceedings, and such counsel does not know of any
statutes or legal or governmental proceedings required to be described in the
Prospectus that are not described in the Registration Statement or the
Prospectus or included as exhibits to the Registration Statement that are not
described or included as required.
(vii) The
Registration Statement is effective under the Act. To such counsel’s knowledge,
no stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been insti-tuted or are
pending or threatened under the Act or applicable state securities
laws.
(viii) To
such
counsel’s knowledge, there is no action, suit or proceeding before or by any
court of governmental agency or body, domestic
or foreign, now pending, or threatened against the Company that is required
to
be described in the Registration Statement.
(ix) The
opinion of counsel shall further include a statement to the effect that such
counsel
has participated in conferences with officers and other representatives of
the
Company, the Underwriters and the independent public accountants of the Company,
at which conferences the contents of the Registration Statement and the
Prospectus contained therein and related matters were discussed and, although
such counsel is not passing upon and does not assume any responsibility for
the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Pro-spectus contained therein (except as
otherwise set forth in the foregoing opinion), solely on the basis of the
foregoing without independent check and verification, no facts have come to
the
attention of such counsel which lead them to believe that the Registration
Statement or any amendment thereto, at the time the Registration Statement
or
amendment became effective, contained an untrue statement of a material fact
or
omitted to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading or the Prospectus or any amendment
or
supplement thereto, at the time they were filed pursuant to Rule 424(b) or
at
the date of such counsel’s opinion, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statement therein, in light of the circumstances under
which they were made, not misleading (except that such counsel need express
no
opinion with respect to the financial statements and related notes and schedules
thereto and other financial and statistical data and information included in
the
Registration Statement or the Prospectus).
19
4.2.2 Closing
Date and Option Closing Date Opinion of Counsel.
On each
of the Closing Date and the Option Closing Date, if any, the Representative
shall have received the favorable opin-ion of GM, dated the Closing Date or
the
Option Closing Date, as the case may be, addressed to the Representative and
in
form and substance reasonably satisfactory to Drinker Xxxxxx, confirming as
of
the Closing Date and, if applicable, the Option Closing Date, the statements
made by GM in its opinion delivered on the Effective Date.
4.2.3 Reliance.
In
rendering such opinion, such counsel may rely (i) as to matters involving the
application of laws other than the laws of the United States and jurisdictions
in which they are admitted, to the extent such counsel deems proper and to
the
extent specified in such opinion, if at all, upon an opinion or opinions (in
form and substance reasonably satisfactory to Drinker Xxxxxx) of other counsel
reasonably acceptable to Drinker Xxxxxx, familiar with the applicable laws,
and
(ii) as to matters of fact, to the extent they deem proper, on certificates
or other written statements of officers of the Company and officers of
departments of various jurisdictions having custody of documents respecting
the
corporate existence or good standing of the Company, provided
that
copies of any such statements or certificates shall be delivered to the
Underwriters’ counsel if requested. The opinion of counsel for the Company and
any opinion relied upon by such counsel for the Company shall include a
statement to the effect that it may be relied upon by counsel for the
Underwriters in its opinion delivered to the Underwriters.
4.3 Cold
Comfort Letter.
At the
time this Agreement is executed, and at each of the Closing Date and the Option
Closing Date, if any, the Representative shall have received a letter, addressed
to the Representative and in form and substance satisfactory in all respects
(including the non-material nature of the changes or decreases, if any, referred
to in clause (iii) below) to the Representative and to Drinker Xxxxxx from
BDO
dated, respectively, as of the date of this Agreement and as of the Closing
Date
and the Option Closing Date, if any:
(i) Confirming
that they are independent registered public accounting firm with respect to
the
Company within the meaning of the Act and the applicable Regulations and that
they have not, during the periods covered by the financial statements included
in the Prospectus, provided to the Company any non-audit services, as such
term
is used in Section 10A(g) of the Exchange Act;
(ii) Stating
that in their opinion the financial state-ments of the Company included in
the
Registration Statement and Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act and the published
Regulations thereunder;
(iii) Stating
that, on the basis of a reading of the latest available unaudited interim
financial statements of the Company (with an indication of the date of the
latest available unaudited interim financial statements), a reading of the
latest available minutes of the stockholders and board of directors and the
various committees of the board of directors, consultations with officers and
other employees of the Company responsible for financial and accounting matters
and other specified procedures and inquiries, they have been advised by the
Company officials that (a) the unaudited financial statements of the Company
included in the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Regulations or are fairly presented in conformity with generally accepted
accounting principles applied on a basis substantially consistent with that
of
the audited financial statements of the Company included in the Registration
Statement and (b) at a date not later than five days prior to the Effective
Date, Closing Date or Option Closing Date, as the case may be, there was no
change in the capital stock or long-term debt of the Company, or any decrease
in
the stockholders’ equity of the Company as compared with amounts shown in the
September 21, 2007 balance sheet included in the Registration Statement, other
than as set forth in or contemplated by the Registration Statement, or, if
there
was any decrease, setting forth the amount of such decrease;
20
(iv) Stating
that they have compared specific dollar amounts, numbers of shares, percentages
of revenues and earnings, statements and other financial information pertaining
to the Company set forth in the Prospectus in each case to the extent that
such
amounts, numbers, percentages, statements and information may be derived from
the general accounting records, including work sheets, of the Company and
excluding any questions requiring an interpretation by legal counsel, with
the
results obtained from the application of specified readings, inquiries and
other
appropriate procedures (which procedures do not constitute an examination in
accordance with generally accepted auditing standards) set forth in the letter
and found them to be in agreement;
(v) Stating
that they have not provided the Company’s management with any written
communication in accordance with Statement on Auditing Standards No. 60
“Communication of Internal Control Structure Related Matters Noted in an Audit;”
and
(vi) Statements
as to such other matters incident to the transaction contemplated hereby as
the
Representative may reasonably request.
4.4 Officers’
Certificates.
4.4.1 Officers’
Certificate.
At each
of the Closing Date and the Option Closing Date, if any, the Representative
shall have received a certificate of the Company signed by the Chairman of
the
Board or the Chief Executive Officer and the Secretary or Assistant Secretary
of
the Company, dated the Closing Date or the Option Closing Date, as the case
may
be, respectively, to the effect that the Company has performed all covenants
and
complied with all conditions required by this Agree-ment to be performed or
complied with by the Company prior to and as of the Closing Date, or the Option
Closing Date, as the case may be, and that the conditions set forth in Section
4.5 hereof have been satisfied as of such date and that, as of Closing Date
and
the Option Closing Date, as the case may be, the representations and warranties
of the Company set forth in Section 2 hereof are true and correct. In addition,
the Representative will have received such other and further certificates of
officers of the Company as the Representative may reasonably
request.
4.4.2 Secretary’s
Certificate.
At each
of the Closing Date and the Option Closing Date, if any, the Representative
shall have received a certificate of the Company signed by the Secretary or
Assistant Secretary of the Company, dated the Closing Date or the Option Date,
as the case may be, respectively, certifying (i) that the Bylaws and Certificate
of Incorporation of the Company are true and complete, have not been modified
and are in full force and effect, (ii) that the resolutions relating to the
public offer-ing contemplated by this Agreement are in full force and effect
and
have not been modified, (iii) all correspondence between the Company or its
counsel and the Commission, (iv) all correspondence between the Company or
its
counsel and the AMEX and (v) as to the incumbency of the officers of the
Company. The documents referred to in such certificate shall be attached to
such
certificate.
21
4.5 No
Material Changes.
Prior
to and on each of the Closing Date and the Option Closing Date, if any, (i)
there shall have been no material adverse change or development involving a
pro-spective material adverse change in the condition or prospects or the
business activities, financial or otherwise, of the Company from the latest
dates as of which such condition is set forth in the Registration Statement,
the
Pricing Disclosure Package and the Prospectus, (ii) no action suit or
proceeding, at law or in equity, shall have been pending or threatened against
the Company or any Initial Stockholder before or by any court or federal or
state commission, board or other admin-istrative agency wherein an unfavorable
decision, ruling or finding may materially adversely affect the business,
operations, prospects or financial condition or income of the Company, except
as
set forth in the Registration Statement and Prospectus, (iii) no stop order
shall have been issued under the Act and no proceedings therefor shall have
been
initiated or threatened by the Commission, and (iv) the Registration Statement
and the Prospectus and any amendments or supplements thereto shall contain
all
material statements which are required to be stated therein in accordance with
the Act and the Regulations and shall conform in all material respects to the
requirements of the Act and the Regulations, and neither the Registration
Statement nor the Prospectus nor any amendment or supplement thereto shall
contain any untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading.
4.6 Delivery
of Agreements.
On the
Effective Date, the Company shall have delivered to the Representative executed
copies of the Escrow Agreement, the Trust Agreement, the Warrant Agreement,
the
Services Agreement, the Subscription Agreement and all of the Insider
Letters.
4.7 Opinion
of Counsel for the Underwriters.
All
proceedings taken in connection with the authorization and validity of the
issuance of the Public Securities as herein contemplated shall be reasonably
satisfactory in form and substance to the Representative and to Drinker Xxxxxx
and the Representative shall have received from such counsel a favorable
opinion, dated the Closing Date and the Option Closing Date, if any, with
respect to such valid authorization and issuance, to the extent the
Representative may reasonably require such opinion. On or prior to the Effective
Date, the Closing Date and the Option Closing Date, as the case may be, counsel
for the Underwriters shall have been furnished such documents, certificates
and
opinions as they may reasonably require for the purpose of enabling them to
review or pass upon the matters referred to in this Section 4.7, or in order
to
evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained.
4.8 Secondary
Market Trading Survey.
On the
Closing Date, the Representative shall have received the Secondary Market
Trading Survey from GM.
4.9 Insider
Securities.
On the
Closing Date, Fortune Management shall have purchased the Insider Securities
and
the purchase price for such Insider Securities shall be deposited into the
Trust
Fund.
22
5. Indemnification.
5.1 Indemnification
of Underwriters.
5.1.1 General.
Subject
to the conditions set forth below, the Company agrees to indemnify and hold
harmless each of the Underwriters, and each dealer selected by the
Representative that participates in the offer and sale of the Public Securities
(each a “Selected Dealer”) and each of their respective directors, officers and
employees and each person, if any, who controls any such Underwriter
(“controlling person”) within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, against any and all loss, liability, claim, damage
and expense whatsoever (including but not limited to any and all legal or other
expenses reasonably incurred in investigating, preparing or defending against
any litigation, commenced or threatened, or any claim whatsoever, whether
arising out of any action between any of the Underwriters and the Company or
between any of the Underwriters and any third party or otherwise) to which
they
or any of them may become subject under the Act, the Exchange Act or any other
statute or at common law or otherwise or under the laws of foreign countries,
arising out of or based upon any untrue statement or alleged untrue statement
of
a material fact contained in (i) any Preliminary Prospectus, the Registration
Statement or the Prospectus (as from time to time each may be amended and
supplemented); or (ii) any application or other document or written
communication (in this Section 5 collectively called “application”) executed by
the Company or based upon written information furnished by the Company in any
jurisdiction in order to qualify the Public Securities under the securities
laws
thereof or filed with the Commission, any state securities commission or agency,
or any securities exchange; or the omission or alleged omission therefrom of
a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, unless such statement or omission was made in reliance upon and
in
conformity with written information furnished to the Company with respect to
an
Underwriter by or on behalf of such Underwriter expressly for use in any
Preliminary Prospectus, the Registration Statement or Prospectus, or any
amendment or supplement thereof, or in any application, as the case may be.
With
respect to any untrue statement or omission or alleged untrue statement or
omission made in the Preliminary Prospectus, the indemnity agreement contained
in this paragraph shall not inure to the benefit of any Underwriter to the
extent that the untrue statement or omission has been corrected in the
Prospectus and any loss, liability, claim, damage or expense of such Underwriter
results from the fact that the Prospectus (or, in lieu thereof, the notice
referred to under Rule 173(a) under the Act) was not delivered as required
by
the Act and the Regulations to such person asserting any such loss, liability,
claim or damage, unless such failure to deliver the Prospectus (or, in lieu
thereof, the notice referred to under Rule 173(a) under the Act) was a result
of
non-compliance by the Company with its obligations under Section 3.4 hereof.
The
Company agrees promptly to notify the Representative of the commencement of
any
litigation or proceedings against the Company or any of its officers, directors
or controlling persons in connection with the issue and sale of the Public
Securities or in connection with the Registration Statement or any Preliminary
Prospectus.
5.1.2 Procedure.
If any
action is brought against an Underwriter, a Selected Dealer or a controlling
person in respect of which indemnity may be sought against the Company pursuant
to Section 5.1.1, such Underwriter or Selected Dealer shall promptly notify
the Company in writing of the institution of such action and the Company shall
assume the defense of such action, including the employment and fees of counsel
(subject to the reasonable approval of such Underwriter or Selected Dealer,
as
the case may be) and payment of actual expenses. Such Underwriter, Selected
Dealer or controlling person (each of which as an “indemnified party” and all of
whom are “indemnified parties”) shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be
at
the expense of such Underwriter, Selected Dealer or controlling person unless
(i) the employment of such counsel at the expense of the Company shall have
been
authorized in writing by the Company in connection with the defense of such
action, or (ii) the Company shall not have employed counsel to have charge
of
the defense of such action, or (iii) such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
the reasonable fees and expenses of not more than one additional firm of
attorneys selected by the Underwriter, Selected Dealer and/or controlling person
shall be borne by the Company. Notwithstanding anything to the contrary
contained herein, if the Underwriter, Selected Dealer or controlling person
shall assume the defense of such action as provided above, the Company shall
have the right to approve the terms of any settlement of such action which
approval shall not be unreasonably withheld. This Indemnification provided
for
in this Section 5.1 shall not be available to any party who shall fail to give
notice as provided in this Section 5.1.2 if the Company was unaware of the
proceeding to which such notice would have related and was actually prejudiced
by the failure to give such notice; provided,
however,
that
indemnification shall only be limited to the extent of such prejudice;
provided,
further,
that,
the omission so to notify the Company will not relieve it from any liability
which it may have to any indemnified party otherwise than under this Section
5.1. The Company shall not without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release
of
such indemnified party from all liability on claims that are the subject matter
of such proceedings.
23
5.2 Indemnification
of the Company.
Each
Underwriter, severally and not jointly, agrees to indemnify and hold harmless
the Company, its directors, officers and employees and agents who control the
Company within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act against any and all loss, liability, claim, damage and expense
described in the foregoing indemnity from the Company to the several
Underwriters, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions made in any Prelimi-nary
Prospectus, the Registration Statement or Prospectus or any amendment or
supplement thereto or in any application, in reliance upon, and in strict
conformity with, written information furnished to the Company with respect
to
such Underwriter by or on behalf of the Underwriter expressly for use in such
Preliminary Prospectus, Registration Statement or Prospectus or any amendment
or
supplement thereto or in any such application. In case any action shall be
brought against the Company or any other person so indemnified based on any
Preliminary Prospectus, Registration Statement or Prospectus or any amendment
or
supplement thereto or any application, and in respect of which indemnity may
be
sought against any Underwriter, such Underwriter shall have the rights and
duties given to the Company, and the Company and each other person so
indemnified shall have the rights and duties given to the several Underwriters
by the provisions of Section 5.1.2.
5.3 Contribution.
5.3.1 Contribution
Rights.
In
order to provide for just and equitable contribution under the Act in any case
in which (i) any person entitled to indemnification under this Section 5
makes claim for indemnification pursuant hereto but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indem-nification may not be enforced in such case notwithstanding
the
fact that this Section 5 provides for indemnification in such case, or (ii)
contribution under the Act, the Exchange Act or otherwise may be required on
the
part of any such person in circumstances for which indemnification is provided
under this Section 5, then, and in each such case, the Company and the
Underwriters shall contri-bute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Underwriters, as incurred, in such proportions
that the Underwriters and the Company are responsible for; provided,
that,
no person guilty of a fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person
who
was not guilty of such fraudulent misrepresentation. For purposes of this
Section, each director, officer and employee of an Underwriter or the Company,
as applicable, and each person, if any, who controls an Underwriter or the
Company, as applicable, within the meaning of Section 15 of the Act shall have
the same rights to contribution as the Underwriters or the Company, as
applicable.
5.3.2 Contribution
Procedure.
Within
fifteen days after receipt by any party to this Agreement (or its
representative) of notice of the commencement of any action, suit or proceeding,
such party will, if a claim for contribution in respect thereof is to be made
against another party (“contributing party”), notify the contributing party of
the commencement thereof, but the omission to so notify the contributing party
will not relieve it from any liability which it may have to any other party
other than for contribution hereunder. In case any such action, suit or
proceeding is brought against any party, and such party notifies a contributing
party or its representative of the commencement thereof within the aforesaid
fifteen days, the contributing party will be entitled to participate therein
with the notifying party and any other contributing party similarly notified.
Any such contributing party shall not be liable to any party seeking
contribution on account of any settlement of any claim, action or proceeding
effected by such party seeking contribution on account of any settlement of
any
claim, action or proceeding effected by such party seeking contribution without
the written consent of such contributing party. The contribution provisions
contained in this Section are intended to supersede, to the extent permitted
by
law, any right to contribution under the Act, the Exchange Act or otherwise
available. The Underwriters’ obligations to contribute pursuant to this Section
5.3 are several and not joint.
24
6. Default
by an Underwriter.
6.1 Default
Not Exceeding 10% of Firm Units or Option Units.
If any
Underwriter or Underwriters shall default in its or their obligations to
purchase the Firm Units or the Option Units, if the over-allotment option is
exercised, hereunder, and if the number of the Firm Units or Option Units with
respect to which such default relates does not exceed in the aggregate 10%
of
the number of Firm Units or Option Units that all Underwriters have agreed
to
purchase hereunder, then such Firm Units or Option Units to which the default
relates shall be purchased by the non-defaulting Underwriters in proportion
to
their respective commitments hereunder.
6.2 Default
Exceeding 10% of Firm Units or Option Units.
In the
event that the default addressed in Section 6.1 above relates to more than
10%
of the Firm Units or Option Units, the Representative may in its discretion
arrange for itself or for another party or parties to purchase such Firm Units
or Option Units to which such default relates on the terms contained herein.
If
within one business day after such default relating to more than 10% of the
Firm
Units or Option Units the Representative do not arrange for the purchase of
such
Firm Units or Option Units, then the Company shall be entitled to a further
period of one business day within which to procure another party or parties
satisfactory to the Representative to purchase said Firm Units or Option Units
on such terms. In the event that neither the Representative nor the Company
arrange for the purchase of the Firm Units or Option Units to which a default
relates as provided in this Section 6, this Agreement will be terminated by
the
Representative or the Company without liability on the part of the Company
(except as provided in Sections 3.13 and 5 hereof) or the several Underwriters
(except as provided in Section 5 hereof); provided,
however,
that if
such default occurs with respect to the Option Units, this Agreement will not
terminate as to the Firm Units; and provided further that nothing herein shall
relieve a defaulting Underwriter of its liability, if any, to the other several
Underwriters and to the Company for damages occasioned by its default
hereunder.
6.3 Postponement
of Closing Date.
In the
event that the Firm Units or Option Units to which the default relates are
to be
purchased by the non-defaulting Underwriters, or are to be purchased by another
party or parties as aforesaid, the Representative or the Company shall have
the
right to postpone the Closing Date or Option Closing Date for a reasonable
period, but not in any event exceeding five business days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement
or
the Prospectus or in any other documents and arrangements, and the Company
agrees to file promptly any amendment to the Registration Statement or the
Prospectus that in the opinion of counsel for the Underwriters may thereby
be
made necessary. The term “Underwriter” as used in this Agreement shall include
any party substituted under this Section 6 with like effect as if it had
originally been a party to this Agreement with respect to such Public
Securities.
25
7. Additional
Covenants.
7.1 Additional
Shares or Options.
The
Company hereby agrees that until the consummation of a Business Combination,
it
shall not issue any shares of Common Stock or any options or other securities
convertible into Common Stock, or any shares of Preferred Stock which
participate in any manner in the Trust Fund or which vote as a class with the
Common Stock on a Business Combination.
7.2 Trust
Fund Waiver Acknowledgment.
(a) Underwriters/Representative.
Except
with respect to the underwriting discounts and commissions due to the
Underwriters, each of the Underwriters and the Representative hereby agree
that
it does not have any right, title, interest or claim of any kind in or to any
monies in the Trust Fund (“Claim”) and waive any Claim it may have in the future
as a result of, or arising out of, any negotiations, contracts or agreements
with the Company and will not seek recourse against the Trust Fund for any
reason whatsoever.
(b) Target
Businesses and Vendors.
The
Company hereby agrees that it will not commence its due diligence investigation
of any operating business which the Company seeks to acquire (“Target Business”)
or obtain the services of any vendor unless and until such Target Business
or
vendor acknowledges in writing, whether through a letter of intent, memorandum
of understanding or other similar document (and subsequently acknowledges the
same in any definitive document replacing any of the foregoing), that (a) it
has
read the Prospectus and understands that the Company has established the Trust
Fund for the benefit of the public stockholders and that the Company may
disburse monies from the Trust Fund only (i) to the public stockholders in
the
event they elect to convert their IPO Shares (as defined below in Section 7.6),
(ii) to the public stockholders upon the liquidation of the Company if the
Company fails to consummate a Business Combination or (iii) to the Company
after, or concurrently with, the consummation of a Business Combination and
(b)
for and in consideration of the Company (1) agreeing to evaluate such Target
Business for purposes of consummating a Business Combination with it or (2)
agreeing to engage the services of the vendor, as the case may be, such Target
Business or vendor agrees that it does not have Claim in or to any monies in
the
Trust Fund and waives any Claim it may have in the future as a result of, or
arising out of, any negotiations, contracts or agreements with the Company
and
will not seek recourse against the Trust Fund for any reason whatsoever.
7.3 Insider
Letters.
The
Company shall not take any action or omit to take any action which would cause
a
breach of any of the Insider Letters executed between each Initial Stockholder
and EBC and will not allow any amendments to, or waivers of, such Insider
Letters without the prior written consent of EBC.
7.4 Certificate
of Incorporation and Bylaws.
The
Company shall not take any action or omit to take any action that would cause
the Company to be in breach or violation of its Certificate of Incorporation
or
Bylaws. Prior to the consummation of a Business Combination, the Company will
not amend its Certificate of Incorporation without the prior written consent
of
EBC.
7.5 Blue
Sky Requirements.
The
Company shall provide counsel to the Representative with ten copies of all
proxy
information and all related material filed with the Commission in connection
with a Business Combination concurrently with such filing with the Commission.
In addition, the Company shall furnish any other state in which its initial
public offering was registered, such information as may be requested by such
state.
26
7.6 Acquisition/Liquidation
Procedure.
The
Company agrees: (i) that, prior to the consummation of any Business Combination,
it will submit such transaction to the Company's stockholders for their approval
(“Business Combination Vote”) even if the nature of the acquisition is such as
would not ordinarily require stockholder approval under applicable state law
and
will publicly announce the record date establishing the stockholders that will
be entitled to vote at the meeting to approve the Business Combination at least
two business days prior to such record date; and (ii) that, in the event that
the Company does not effect a Business Combination within 24 months from the
Effective Date, the Company will be liquidated and will distribute to all
holders of IPO Shares (defined below) an aggregate sum equal to the Company’s
“Liquidation Value.” The Company’s “Liquidation Value” shall mean the Company’s
book value, as determined by the Company and approved by BDO. In no event,
however, will the Company’s Liquidation Value be less than the Trust Fund,
inclusive of any net interest income thereon not otherwise utilized as
contemplated by the Trust Agreement.
Only
holders of IPO Shares shall be entitled to receive liquidating distributions
and
the Company shall pay no liquidating distributions with respect to any other
shares of capital stock of the Company. With respect to the Business Combination
Vote, the Company shall cause all of the Initial Stockholders to vote the shares
of Common Stock owned by them immediately prior to this Offering in accordance
with the vote of the holders of a majority of the IPO Shares present, in person
or by proxy, at a meeting of the Company’s stockholders called for such purpose.
At the time the Company seeks approval of any potential Business Combination,
the Company will offer each holder of Common Stock issued in this Offering
(“IPO
Shares”) the right to convert their IPO Shares at a per share price (“Conversion
Price”) equal to the amount in the Trust Fund (inclusive of any interest income
therein) calculated as of two business days prior to the consummation of the
proposed Business Combination divided by the total number of IPO Shares. If
a
majority of the holders of IPO Shares present and entitled to vote on the
Business Combination vote in favor of such Business Combination and holders
of
less than 40% in interest of the Company’s IPO Shares elect to convert their IPO
Shares, the Company may, but will not be required to, proceed with such Business
Combination. If the Company elects to so proceed, it will convert shares, based
upon the Conversion Price, from those holders of IPO Shares who affirmatively
requested such conversion and who voted against the Business Combination. If
holders of 30% or
more
in interest of the IPO Shares, who vote against approval of any potential
Business Combination, elect to convert their IPO Shares, the Company will not
proceed with such Business Combination and will not convert such shares. The
provisions of this Section 7.6 may not be modified, amended or deleted under
any
circumstances.
7.7 Forfeiture
of Initial Stockholder Shares.
If
holders of 20% or more in interest of the IPO Shares vote against a proposed
Business Combination and seek to exercise their conversion rights and such
Business Combination is consummated, the Initial Stockholders agree to forfeit
and return to the Company for cancellation a number of shares so that the
Initial Stockholders will collectively own no more than 23.8% of the Company’s
outstanding common stock upon consummation of a Business Combination (without
giving effect to any shares of common stock that may be issued in the Business
Combination). The Initial Stockholders may determine the allocation of forfeited
shares however they see fit.
7.8 Rule
419.
The
Company agrees that it will use its best efforts to prevent the Company from
becoming subject to Rule 419 under the Act prior to the consummation of any
Business Combination, including but not limited to using its best efforts to
prevent any of the Company’s outstanding securities from being deemed to be a
“xxxxx stock” as defined in Rule 3a-51-1 under the Exchange Act during such
period.
7.9 Affiliated
Transactions.
The
Company shall cause each of the Initial Stockholders to agree that, in order
to
minimize potential conflicts of inter-est which may arise from multiple
affiliations, the Initial Stockholders will present to the Company for its
consideration, prior to presentation to any other person or company, any
suitable opportunity to acquire an operating business, until the earlier of
the
consummation by the Company of a Business Combination, the liquidation of the
Company or until such time as the Initial Stockholders cease to be an officer
or
director of the Company, subject to any pre-existing fiduciary or contractual
obligations the Initial Stockholders might have.
27
7.10 Target
Net Assets.
The
Company agrees that the initial Target Business that it acquires must have
a
fair market value equal to at least 80% of the Company’s net assets (all of the
Company’s assets, including the funds held in the Trust Fund, less the Company’s
liabilities) at the time of such acquisition. The fair market value of such
business must be determined by the Board of Directors of the Company based
upon
standards generally accepted by the financial community, such as actual and
potential sales, earnings and cash flow and book value. If the Board of
Directors of the Company is not able to independently determine that the target
business has a fair market value of at least 80% of the Company’s net assets at
the time of such acquisition, the Company will obtain an opinion from an
unaffiliated, independent investment banking firm with respect to the
satisfaction of such criteria. The Company is not required to obtain an opinion
from an investment banking firm as to the fair market value if the Company’s
Board of Directors independently determines that the Target Business does have
sufficient fair market value.
8. Representations
and Agreements to Survive Delivery.
Except
as the context otherwise requires, all representations, warranties and
agreements contained in this Agreement shall be deemed to be repre-sentations,
warranties and agreements at the Closing Date or Option Closing Date and such
representations, warranties and agreements of the Underwriters and Company,
including the indemnity agreements contained in Section 5 hereof and any
obligations, covenants, agreements, representations and warranties imposed
upon
the Company following the Closing Date and Option Closing Date, shall remain
operative and in full force and effect regard-less of any investigation made
by
or on behalf of any Underwriter, the Company or any controlling person, and
shall survive termina-tion of this Agreement or the issuance and delivery of
the
Public Securities to the several Underwriters until the earlier of the
expiration of any applicable statute of limitations and the seventh anniversary
of the later of the Closing Date or the Option Closing Date, if any, at which
time the representations, warranties and agreements shall terminate and be
of no
further force and effect.
9. Effective
Date of This Agreement and Termination Thereof.
9.1 Effective
Date.
This
Agreement shall become effective on the Effective Date at the time the
Registration Statement is declared effective by the Commission.
9.2 Termination.
The
Representative shall have the right to terminate this Agreement at any time
prior to any Closing Date, (i) if any domes-tic or international event or act
or
occurrence has materially disrupted, or in the Representative’s opinion will in
the immediate future materially disrupt, general securities markets in the
United States; or (ii) if trading on the New York Stock Exchange, the American
Stock Exchange, the Nasdaq Stock Market LLC or on the NASD OTC Bulletin Board
(or successor trading market) shall have been suspended, or minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for
securities shall have been fixed, or maximum ranges for prices for securities
shall have been required on the American Stock Exchange or by order of the
Commission or any other government authority having jurisdiction, or (iii)
if
the United States shall have become involved in a new war or an increase in
major hostilities, or (iv) if a banking moratorium has been declared by a New
York State or federal authority, or (v) if a moratorium on foreign exchange
trading has been declared which materially adversely impacts the United States
securities market, or (vi) if the Company shall have sustained a material loss
by fire, flood, accident, hurricane, earthquake, theft, sabotage or other
calamity or malicious act which, whether or not such loss shall have been
insured, will, in the Representative’s opinion, make it inadvisable to proceed
with the delivery of the Units, or (vii) if any of the Company’s
representations, warranties or covenants hereunder are breached, or (viii)
if
the Representative shall have become aware after the date hereof of such a
material adverse change in the conditions or prospects of the Company, or such
material adverse change in general market conditions, including without
limitation, as a result of terrorist activities after the date hereof, as in
the
Representative’s judgment would make it impracticable or inadvisable to proceed
with the offering, sale and/or delivery of the Units or to enforce contracts
made by the Underwriters for the sale of the Public Securities.
28
9.3 Expenses.
In the
event that this Agreement shall not be carried out for any reason whatsoever,
within the time specified herein or any extensions thereof pursuant to the
terms
herein, the obligations of the Company to pay the out of pocket expenses related
to the transactions contemplated herein shall be governed by Section 3.13
hereof; provided,
however,
that
reimbursement shall only be provided for out of pocket expenses which are
actually incurred.
9.4 Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election
hereunder or any termina-tion of this Agreement, and whether or not this
Agreement is other-wise carried out, the provisions of Section 5 shall not
be in
any way effected by, such election or termination or failure to carry out the
terms of this Agreement or any part hereof.
10. Absence
of Fiduciary Duty.
The
Company acknowledges and agrees that: (a) the Underwriters’ responsibility to
the Company is solely contractual in nature, the Underwriters have been retained
solely to act as underwriters in connection with the Offering and no fiduciary,
advisory or agency relationship between the Company and the Underwriters has
been created in respect of any of the transactions contemplated by this
Agreement, irrespective of whether the Underwriters has advised or is advising
the Company on other matters; (b)
the
price of the Units set forth in this Agreement was established following
arms-length negotiations and the Company is capable of evaluating and
understanding, and understands and accepts, the terms, risks and conditions
of
the transactions contemplated by this Agreement; (c) it has been advised that
the Underwriters and their affiliates are engaged in a broad range of
transactions which may involve interests that differ from those of the Company
and that the Underwriters
have no
obligation to disclose such interests and transactions to the Company by virtue
of any fiduciary, advisory or agency relationship; and (d) it waives, to the
fullest extent permitted by law, any claims it may have against the Underwriters
for breach of fiduciary duty and agrees that
the
Underwriters shall have no liability (whether direct or indirect) to the Company
in respect of such a fiduciary duty claim or to any person asserting a fiduciary
duty claim on behalf of or in right of the Company, including stockholders,
employees or creditors of the Company.
11. Miscellaneous.
11.1 Notices.
All
communications hereunder, except as herein otherwise specifically provided,
shall be in writing and shall be mailed, delivered or telecopied and confirmed
and shall be deemed given when so delivered or telecopied and confirmed or
if
mailed, two days after such mailing.
If
to the
Representative:
EarlyBirdCapital,
Inc.
000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxx X. Xxxxxxxx, Chairman
Copy
to:
Drinker
Xxxxxx & Xxxxx LLP
One
Xxxxx
Square
18th
and
Cherry Streets
Philadelphia,
Pennsylvania 19103-6996
Attn:
Xxxxxxx X. Xxxxxxx, Esq.
29
If
to the
Company:
000
Xxxxx
Xxxx Xxxxx, Xxxxxxxx 000
Xxxxx,
Xxxxxxxxxxxx 00000
Attn:
Xxxxxx X. Xxxx, Chief Executive Officer
Copy
to:
Xxxxxxxx
Xxxxxx
Xxx
Xxxxxxxx Xxxxxxxx
Xxxxxxxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxx Xxxx Xxxxxx, Esq.
11.2 Headings.
The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any
of
the terms or provisions of this Agreement.
11.3 Amendment.
Except
for Section 7.6 (which may not be amended under any circumstances), this
Agreement may only be amended by a written instrument executed by each of the
parties hereto.
11.4 Entire
Agreement.
This
Agreement (together with the other agreements and documents being delivered
pursuant to or in connection with this Agreement) constitute the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof, and supersede all prior agreements and understandings of the parties,
oral and written, with respect to the subject matter hereof.
11.5 Binding
Effect.
This
Agreement shall inure solely to the benefit of and shall be binding upon the
Representative, the Underwriters, the Company and the controlling persons,
directors and officers referred to in Section 5 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have
or
be construed to have any legal or equitable right, remedy or claim under or
in
respect of or by virtue of this Agreement or any provisions herein
contained.
11.6 Governing
Law.
This
Agreement shall be governed by and construed and enforced in accor-dance with
the laws of the State of New York, without giving effect to conflicts of law
principles that would result in the application of the substantive laws of
another jurisdiction. The Company hereby agrees that any action, proceeding
or
claim against it arising out of, or relating in any way to this Agreement shall
be brought and enforced in the courts of the State of New York of the United
States of America for the Southern District of New York, and irrevocably submits
to such jurisdiction, which jurisdiction shall be exclu-sive. The Company hereby
waives any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum. Any such process or summons to be served upon
the Company may be served by transmitting a copy thereof by registered or
certified mail, return receipt requested, postage prepaid, addressed to it
at
the address set forth in Section 10 hereof. Such mailing shall be deemed
personal service and shall be legal and binding upon the Company in any action,
proceeding or claim. The Company agrees that the pre-vailing party(ies) in
any
such action shall be entitled to recover from the other party(ies) all of its
reasonable attor-neys’ fees and expenses relating to such action or proceeding
and/or incurred in connection with the preparation therefor.
30
11.7 Execution
in Counterparts.
This
Agreement may be executed in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which shall be deemed to be
an
original, but all of which taken together shall constitute one and the same
agreement, and shall become effective when one or more counterparts has been
signed by each of the parties hereto and delivered to each of the other parties
hereto.
11.8 Waiver,
Etc.
The
failure of any of the parties hereto to at any time enforce any of the
provisions of this Agreement shall not be deemed or construed to be a waiver
of
any such provision, nor to in any way effect the validity of this Agreement
or
any provision hereof or the right of any of the parties hereto to thereafter
enforce each and every provision of this Agreement. No waiver of any breach,
non-compliance or non-fulfillment of any of the provisions of this Agreement
shall be effective unless set forth in a written instrument executed by the
party or parties against whom or which enforcement of such waiver is sought;
and
no waiver of any such breach, non-compliance or non-fulfillment shall be
construed or deemed to be a waiver of any other or subsequent breach,
non-compliance or non-fulfillment.
31
If
the
foregoing correctly sets forth the understanding between the Underwriters and
the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between
us.
Very
truly yours,
By: ________________________________________
Name:
Title:
Accepted
on the date first
above
written.
EARLYBIRDCAPITAL,
INC.
Acting
severally on behalf of itself and the several Underwriters listed in Schedule
I
hereto
By: ________________________________________
Name:
Title:
32
SCHEDULE
I
20,000,000
Units
|
Underwriter
|
Number
of Firm Units
to
be Purchased
|
|
|
EarlyBirdCapital,
Inc.
|
||
| Ladenburg Xxxxxxxx & Co. Inc. | ||
| Maxim Group LLC | ||
| Pali Capital, Inc. | ||
|
20,000,000
|
33
