6,000,000 Units BIG ROCK PARTNERS ACQUISITION CORP. UNDERWRITING AGREEMENT
Exhibit
1.1
6,000,000 Units
November
20, 2017
EarlyBirdCapital, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
As Representative of the Underwriters
named on Schedule A
hereto
Ladies
and Gentlemen:
Big
Rock Partners Acquisition Corp., a Delaware corporation (the
“Company”),
hereby confirms its agreement with EarlyBirdCapital, Inc. (the
“Representative”) and with the
other underwriters named on Schedule A
hereto (if any), for which the Representative is acting as
representative (the Representative and such other underwriters
being collectively referred to herein as the “Underwriters” or, each underwriter
individually, an “Underwriter”) as
follows:
1. Purchase
and Sale of Securities.
1.1.
Units.
Purchase of 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 to the several Underwriters, severally and
not jointly, an aggregate of 6,000,000 units of the
Company (the “Firm
Units”) at a purchase
price (net of discounts and commissions) of $9.75 per Firm Unit.
Each Unit consists of one share of common stock of the Company, par
value $0.001 per share
(the “Common
Stock”), one right (the “Right(s)”) to receive one-tenth of
one share of Common Stock on consummation of a Business Combination
(defined below) and one-half of one warrant (the
“Warrant(s)”) each
whole Warrant to purchase one share of Common Stock for $11.50 per
share. The Common Stock, Rights and Warrants included in the Firm
Units will not be separately tradable until 90 days after the date
hereof unless the Representative informs the Company of its
decision to allow earlier separate trading, subject to the Company
filing a Current Report on Form 8-K with the Commission (defined
below) containing an audited balance sheet reflecting the
Company’s receipt of the gross proceeds of the Offering
(defined below) and the sale of the Private Units (defined below)
and issuing a press release announcing when such separate trading
will begin. 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 A. The Firm Units are to
be offered initially to the public (the “Offering”) at the offering price
of $10.00 per Firm Unit.
1.1.1. Payment
and Delivery. Delivery and payment for the Firm Units
shall be made at 10:00 A.M., New York time, on the second
(2nd)
Business Day following the 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 closing of the Offering
is referred to herein as the “Closing” and the hour and date of
delivery and payment for the Firm Units is referred to herein as
the “Closing
Date.” Payment for the Firm Units shall be made
on the Closing Date through the facilities of Depository Trust
Company (“DTC”)
by wire transfer in Federal (same day) funds. The Company shall
receive an aggregate of $61,000,000 net proceeds from
the sale of the Firm Units and the Private Units, of which
$60,000,000 shall be deposited on the Closing
Date into the trust account (the “Trust Account”) established by the
Company for the benefit of the Public Stockholders, as described in
the Registration Statement (as defined
in Section 2.1.1 below) and pursuant to the terms of an
Investment Management Trust Agreement (the “Trust Agreement”) between the
Company and Continental Stock Transfer & Trust Company (“CST&T”) substantially in the
form annexed as an exhibit to the Registration Statement. The
remaining proceeds (less actual expense payments or other fees
payable pursuant to this Agreement) shall be paid to the order of
the Company upon delivery of certificates (in form and substance
reasonably satisfactory to the Representative) representing the
Firm Units (or through the facilities of the DTC for the account of
the Representative). 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 (2) Business
Days (defined below) prior to the Closing Date. The Company
will permit the Representative to examine and package the Firm
Units for delivery at least one (1) 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. As used herein, the term
“Business Day”
shall mean any day other than a Saturday, Sunday or any day on
which national banks in New York, New York are not open for
business, and the term “Public Stockholders” means the
holders of Common Stock sold in the Offering or acquired in the
aftermarket, including any of the Respondents (as defined in
Section 2.14 below) to the extent they acquire such Common Stock in
the Offering or in the aftermarket (and solely with respect to such
shares).
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Inc.
November
20, 2017
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1.2. Over-Allotment
Option
1.2.1. The
Representative shall have the option (the “Over-Allotment Option”) to
purchase all or less than all of an additional
900,000 Units (the “Option Units”) solely for the
purposes of covering any over-allotments in connection with the
distribution and sale of the Firm Units. Such Option Units shall,
at the Representative’s election, be purchased for each
account of the several Underwriters in the same proportion as the
number of Firm Units set forth opposite such Underwriter’s
name on Schedule A hereto (subject to adjustment by the
Representative to eliminate fractions). Such Option Units shall be
identical in all respects to the Firm Units. The Firm Units and the
Option Units are hereinafter collectively referred to as the
“Public
Securities.” No Option Units shall be sold or
delivered unless the Firm Units previously have been, or
simultaneously are, sold and delivered. The right to purchase the
Option Units, or any portion thereof, may be exercised from time to
time and to the extent not previously exercised may be surrendered
and terminated at any time upon notice by the Representative to the
Company. The purchase price to be paid for each Option Unit (net of
discounts and commissions) will be $9.75 per Option
Unit.
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 forty-five (45) days after the Effective Date. The
Representative 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 accordance with Section 10.1 herein setting
forth the number of Option Units to be purchased and the date and
time for delivery of and payment for the Option Units, if other
than the Closing Date (the “Option Closing Date”), which shall
not be earlier than the Closing Date or be later than ten (10) 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 Representative, and, subject to the terms and
conditions set forth herein, the Representative 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: $9.75 per Option Unit shall be deposited in the Trust
Fund pursuant to the Trust Agreement upon delivery of certificates
(in form and substance satisfactory to the Representative)
representing the Option Units (or through the facilities of DTC)
for the account of the Representative). 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 business 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.
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Inc.
November
20, 2017
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1.3. Representative’s
Securities.
1.3.1. The
Company hereby agrees to issue and sell to the Representative
(and/or its designees) on the Closing Date, for an aggregate
purchase price of $100, an option (“Representative’s Purchase
Option”) to purchase up
to an aggregate of 600,000 Units (the
“Representative’s
Units”). Each of the
Representative's Units is identical to the Firm Units. The
Representative’s Purchase Option shall be exercisable for
cash or on a cashless basis, in whole or in part, commencing on the
later of the consummation of a Business Combination or one year
from the Effective Date and expiring on the five-year anniversary
of the Effective Date at an initial exercise price per
Representative’s Unit of $10.00, which is equal to one
hundred percent (100%)
of the initial public offering price per Unit. On the Closing Date,
the Company shall deliver to the Representative, upon payment
therefor, certificates for the Representative’s Purchase
Option in the name or names and in such denominations as the
Representative may request.
1.3.2. The
Company hereby agrees to issue to the Representative (and/or its
designees), for no additional consideration, 120,000
shares of Common Stock (or up to 138,000 shares if the
underwriters’ over-allotment option is exercised in full)
(the “Representative’s
Shares”). The
Representative’s Shares shall be issued on the Closing Date
and on any Option Closing Date, as applicable. On such date or
dates, the Company shall deliver to the Representative (and/or its
designees), upon execution of customary and mutually agreed upon
investor representation letters, certificates for the
Representative’s Shares in the name or names and in such
denominations as the Representative may request. The Representative
hereby agrees not to transfer, assign or sell any
Representative’s Shares without the Company’s prior
consent until the completion of the Business Combination. The
Representative’s Shares will be identical to the shares of
Common Stock included in the Firm Units except the holders (i)
shall not be entitled to exercise any conversion or redemption
rights with respect to such Representative’s Shares and shall
not be entitled to sell any such shares to the Company in any
tender offer in connection with a proposed Business Combination and
(ii) will have no right to any liquidation distributions with
respect to any portion of the Representative’s Shares in the
event the Company fails to consummate a Business Combination
within the required time period.
Additionally, the Representative (and/or its designees) will have
the same registration rights with respect to the
Representative’s Shares that it has with respect to the
Representative’s Purchase Option and underlying securities.
The registered holder of the Representative’s Shares will not
sell, transfer, assign, pledge or hypothecate any of the
Representative’s Shares for a period of 180 days pursuant to
FINRA Conduct Rule 5110(g)(1) following the effective date of the
Registration Statement to anyone other than (i) the Representative
or an Underwriter or selected dealer in connection with the
Offering, or (ii) a bona fide officer or partner of the
Representative or of any such Underwriter or selected dealer.
Additionally, pursuant to FINRA Conduct Rule 5110(g), the
Representative’s Shares will not be the subject of any
hedging, short sale, derivative, put or call transaction that would
result in the economic disposition of the securities by any person
for a period of 180 days immediately following the effective date
of the Registration Statement. The certificates for the
Representative’s Shares shall contain legends to reflect the
above FINRA and contractual transfer
restrictions.
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Inc.
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1.3.3. The
Representative’s Shares and the Representative’s
Purchase Option, the Representative’s Units, the Common Stock
included in the Representative’s Units, the Rights included
in the Representative’s Units (the “Representative’s Rights”),
the Warrants included in the Representative’s Units (the
“Representative’s
Warrants”) and the Common Stock issuable pursuant to
the terms of the Representative’s Rights and
Representative’s Warrants are hereinafter referred to
collectively as the “Representative’s
Securities.” Delivery
(and payment with respect to the Representative’s Purchase
Option) of the Representative’s Securities shall be made on
the Closing Date or Option Closing Date, as applicable. The
issuance of the Representative’s Securities will be
registered on the Registration Statement.
1.4. Private
Placements.
1.4.1. The
Company issued to Big Rock Partners Sponsor, LLC (the
“Sponsor”) for aggregate consideration of
$25,000 1,437,500 shares of the Company’s Common Stock
(the “Founder’s
Shares”) in a private
placement intended to be exempt from registration under Section
4(a)(2) of the Securities Act of 1933, as amended (the
“Act”). No underwriting discounts, commissions
or placement fees have been or will be payable in connection with
the sale of the Founder’s Shares. In
November 2017, the Company effectuated a stock dividend of 0.2
shares of Common Stock for each outstanding share of Common Stock,
resulting in the Sponsor holding an aggregate of 1,725,000
Founder’s Shares. The Founder’s Shares
shall be held in escrow and subject to restrictions on transfer as
set forth in the Escrow Agreement (as defined in Section 2.24.3
below). The Sponsor shall have no right to any liquidation
distributions with respect to any portion of the Founder’s
Shares in the event the Company fails to consummate any
proposed initial merger, share exchange, asset acquisition, share
purchase, recapitalization, reorganization or other similar
business combination, or entering into contractual arrangements,
with one or more businesses or entities (“Business Combination”) within the required time period. The Sponsor shall
not have conversion rights with respect to the Founder’s
Shares nor shall they be entitled to sell such Founder’s
Shares to the Company in any tender offer in connection with a
proposed Business Combination. To the extent that the
Over-allotment Option is not exercised by the Underwriters in full
or in part, up to 225,000 of the
Founder’s Shares shall be subject to forfeiture by the
Sponsor. The Sponsor will be required to forfeit only a number of
Founder’s Shares necessary to maintain the Sponsor’s
20% beneficial ownership interest in the Common Stock after giving
effect to the Offering and exercise, if any, of the
Underwriters’ Over-allotment Option (and excluding the
issuance of the Representative’s Shares and the purchase by
the Sponsor of the Private Units (defined below) and any shares
purchased in the Offering).
1.4.2. Simultaneously
with the Closing Date, the Sponsor will purchase from the
Company pursuant to a Subscription Agreement (as defined in Section
2.24.2 below), an aggregate of
250,000 Units
(the “Private
Units”) at a purchase
price of $10.00 per Private Unit in a
private placement (the “Private
Placement”) intended to be
exempt from registration under the Act. The terms of the
Private Units are as described in the Prospectus (as defined in
Section 2.1.1 below). No underwriting discounts, commissions or
placement fees have been or will be payable in connection with the
Private Placement. The Sponsor has also agreed that, in
the event the Representative has exercised the Over-allotment
Option, it will purchase up to an additional
22,500 Private Units and
the Company shall cause to be
deposited an amount of additional proceeds from the sale of such
additional Private Units into
the Trust Account such that the amount of funds in the Trust
Account shall be $10.00 per
Public Share sold in the Offering. The purchase price for the
Private Units shall have been delivered to CST&T or counsel for
the Company to hold in a separate escrow account at least 48 hours
prior to the date hereof so that such funds are readily available
to be delivered to the Trust Account on the Closing Date or the
Option Closing Date, as the case may be.
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1.5. Working
Capital; Trust Account Proceeds.
1.5.1. Working
Capital. Upon consummation of the Offering, it is intended
that approximately $500,000 of the net proceeds from the sale of
the Firm Units and Private Units will
be released to the Company to fund the working capital requirements
of the Company.
1.5.2. Trust
Account Proceeds. Interest income on the funds held in the
Trust Account may be released to the Company from the Trust Account
in accordance with the terms of the Trust Agreement to pay any
taxes incurred by the Company, all as more fully described in the
Prospectus.
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 (the “Commission”) a registration
statement and an amendment or amendments thereto, on Form S-1 (File
No. 333-220947), including any related preliminary prospectus (the
“Preliminary
Prospectus”, including any prospectus that is included
in the registration statement immediately prior to the
effectiveness of the registration statement), for the registration
of the Public Securities under the 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 (the “Regulations”) of the Commission
under the Act. Except as the context may otherwise require,
such registration statement, as amended, on file with the
Commission at the time the registration statement became effective
(“Effective
Date”), 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 Rule 430A of the
Regulations, together with the registration statement filed by the
Company pursuant to Rule 462(b) under the Act registering
additional Public Securities (the “Rule 462(b) Registration
Statement”), is hereinafter called the
“Registration
Statement,” and the form of the final prospectus dated
the Effective Date included in the Registration Statement (or, if
applicable, the form of final prospectus containing information
permitted to be omitted at the time of effectiveness by Rule 430A
of the Regulations filed with the Commission pursuant to Rule 424
of the Regulations), is hereinafter called the “Prospectus.” For purposes of this Agreement,
“Time
of Sale”, as used in the
Act, means 5:00 p.m., New York City time, on the date of this
Agreement. Prior to the Time of Sale, the Company prepared a
preliminary prospectus, dated November 14,
2017, for distribution by the
Underwriters (the “Statutory
Prospectus”).
Other than the Registration Statement, together with any
correspondence letters between the Company and/or counsel for the
Company and the Commission, no other document with respect to the
Registration Statement has heretofore been filed under the Act with
the Commission. All of the Public Securities have been or will be
registered under the Act pursuant to the Registration Statement.
The Registration Statement has been
declared effective by the Commission on the date hereof.
If, subsequent to the date of this
Agreement, the Company or the Representative has determined that at
the Time of Sale the Statutory Prospectus included an untrue
statement of a material fact or omitted a statement of material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and have
agreed to provide an opportunity to purchasers of the Firm Units to
terminate their old purchase contracts and enter into new purchase
contracts, then the Statutory Prospectus will be deemed to include
any additional information available to purchasers at the time of
entry into the first such new purchase
contract.
2.1.2. Pursuant
to the Exchange Act. The Company has filed with the
Commission a Registration Statement on Form 8-A (File Number
001-38302) providing for the registration under the
Securities Exchange Act of 1934, as amended (the
“Exchange Act”),
of the Units, Common Stock, Rights and Warrants. The
registration of the Units, Common Stock, Rights and Warrants under
the Exchange Act has been declared effective by the Commission on
the date hereof.
2.2. No
Stop Orders, etc. Neither the Commission nor, to the
Company’s knowledge, any foreign or state regulatory
authority has issued any order or threatened to issue any order
preventing or suspending the use of any Statutory Prospectus or
Prospectus or has instituted or, to the best of the Company’s
knowledge, threatened to institute any proceedings with respect to
such an order.
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2.3. Disclosures
in Registration Statement.
2.3.1. 10b-5
Representation. At the time of effectiveness of the
Registration Statement (or at the effective time of any
post-effective amendment to the Registration Statement) and at all
times subsequent thereto up to the Closing Date, the Registration
Statement, the Statutory Prospectus and the Prospectus contained or
will contain all material statements that are required to be stated
therein in accordance with the Act and the Regulations, and did or
will, in all material respects, conform to the requirements of the
Act and the Regulations. On the Effective Date and at the Time of
Sale, the Registration Statement did not, and on the Closing Date
it will not, contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading;
on the date of any filing pursuant to Rule 424(b) and on the
Closing Date, the Prospectus (together with any supplement thereto)
will not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; and at the Time of Sale, the Statutory
Prospectus does not include any untrue statement of a material fact
or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading; provided, however, that the
representation and warranty made in this Section 2.3.1 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 Underwriters by the Underwriters expressly for
use in the Registration Statement, the Statutory Prospectus or
Prospectus or any amendment thereof or supplement
thereto, which information, it is
agreed, shall consist solely of the names of the Underwriters and
the subsections entitled “Price Stabilization, Short
Positions,” “Determination of Offering Price,”
“Electronic Distribution” and “Selling
Restrictions” included in the section captioned
“Underwriting.”
2.3.2. Disclosure
of Agreements. The agreements and documents described
in the Registration Statement, the Statutory Prospectus 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, the Statutory Prospectus
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 Registration Statement or attached
as an exhibit thereto, or (ii) is material to the Company’s
business, has been duly and validly executed by the Company, is in
full force and effect in all material respects and is enforceable
against the Company and, to the Company’s knowledge, the
other parties thereto, in all material respects in accordance with
its terms, except (x) as such enforceability 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
foreign, 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 instruments has been
assigned by the Company, and neither the Company nor, to the
Company’s knowledge, any other party is in breach or default
thereunder and, to 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
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.
2.3.3. 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, controlled by, or
under common control with the Company since the date of the
Company’s formation, except as disclosed in the Registration
Statement.
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2.3.4. Regulations.
The disclosures in the Registration Statement, the Statutory
Prospectus and the Prospectus concerning the effects of foreign,
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 necessary to make the
statements therein, in light of the circumstances in which they
were made, not misleading.
2.4. Changes
After Dates in Registration Statement.
2.4.1. No
Material Adverse Change. Since the respective dates as of which information
is given in the Registration Statement, the Statutory Prospectus
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; (iii) no member of the Company’s board of
directors or management has resigned from any position with the
Company; and (iv) no event or occurrence has taken place which
materially impairs, or would likely materially impair, with the
passage of time, the ability of the members of the Company’s
board of directors or management to act in their capacities with
the Company as described in the Registration Statement, the
Statutory Prospectus and the
Prospectus.
2.4.2. Recent
Securities Transactions, etc. Subsequent to the respective
dates as of which information is given in the Registration
Statement, the Statutory Prospectus 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, for borrowed money; or (ii) declared or
paid any dividend or made any other distribution on or in respect
to its capital stock.
2.5. Independent
Accountants. Xxxxxx LLP (“Xxxxxx”), whose report is filed
with the Commission as part of the Registration Statement and
included in the Registration Statement, the Statutory Prospectus
and the Prospectus, are independent registered public accountants
as required by the Act, the Regulations and the Public Company
Accounting Oversight Board (the
“PCAOB”), including the rules and regulations
promulgated by such entity. To the Company’s knowledge,
Xxxxxx is duly registered and
in good standing with the PCAOB. Xxxxxx has not, during the
periods covered by the financial statements included in the
Registration Statement, the Statutory Prospectus and the
Prospectus, provided to the Company any non-audit services, as such
term is used in Section 10A(g) of the Exchange
Act.
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2.6. Financial
Statements; Statistical Data.
2.6.1. Financial
Statements. The financial statements, including the notes
thereto and supporting schedules included in the Registration
Statement, the Statutory Prospectus and the Prospectus, fairly
present in all material respects the financial position and the
results of operations of the Company at the dates and for the
periods to which they apply; and such financial statements have
been prepared in conformity with United States generally accepted
accounting principles (“GAAP”), consistently applied
throughout the periods involved; and the supporting schedules
included in the Registration Statement present fairly in all
material respects the information required to be stated therein in
conformity with the Regulations. No other financial statements or supporting
schedules are required to be included or incorporated by reference
in the Registration Statement, the Statutory Prospectus or
the Prospectus. The
Registration Statement, the Statutory Prospectus and the Prospectus
disclose 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, prospects, liquidity, capital
expenditures, capital resources, or significant components of
revenues or expenses. There are no pro
forma or as adjusted financial statements which are required to be
included
in the Registration
Statement, the Statutory Prospectus or the Prospectus
in accordance with Regulation S-X of the Regulations which have not
been included as so required.
2.6.2. Statistical
Data. The statistical, industry-related and market-related
data included in the Registration Statement, the Statutory
Prospectus and/or the Prospectus are based on or derived from
sources which the Company reasonably and in good faith believes are
reliable and accurate, and such data agree with the sources from
which they are derived.
2.7. Authorized
Capital; Options, etc. The Company had at the date or
dates indicated in each of the Registration Statement, the
Statutory Prospectus and the Prospectus, as the case may be, duly
authorized, issued and outstanding capitalization as set forth in
the Registration Statement, the Statutory Prospectus and the
Prospectus. Based on the assumptions stated in the
Registration Statement, the Statutory Prospectus 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, the Statutory
Prospectus 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
Common Stock or any security convertible into Common Stock, or any
contracts or commitments to issue or sell Common Stock or any such
options, warrants, rights or convertible securities.
2.8. Valid
Issuance of Securities, etc.
2.8.1. Outstanding
Securities. All issued and outstanding Founder’s
Shares 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 preemptive rights of any
holders of any security of the Company or similar contractual
rights granted by the Company. The outstanding Founder’s
Shares conform to the descriptions thereof contained in the
Registration Statement, the Statutory Prospectus and the
Prospectus. All offers, sales and any transfers of the outstanding
Founder’s Shares were at all relevant times either registered
under the Act and the applicable state securities or Blue Sky laws
or exempt from such registration requirements.
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2.8.2. Securities
To Be Sold.
2.8.2.1. The
Public Securities have been duly authorized and reserved for
issuance and when issued and paid for in accordance with this
Agreement, 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
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 Public
Securities conform in all material respects to the descriptions
thereof contained in the Registration Statement, the Statutory
Prospectus and the Prospectus, as the case may
be.
2.8.2.2. The
Representative’s Shares have been duly authorized and
reserved for issuance and when issued in accordance with this
Agreement, 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
Representative’s Shares 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 Representative’s Shares has been
duly and validly taken. The Representative’s Shares conform
in all material respects to the descriptions thereof contained in
the Registration Statement, the Statutory Prospectus and the
Prospectus, as the case may be.
2.8.2.3. When
issued, the Representative’s Purchase Option, the
Representative’s Rights and the Representative’s
Warrants will
constitute the valid and binding obligation 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 such
Representative’s Purchase Option, the Representative’s
Rights and the Representative’s Warrants are enforceable against the
Company in accordance with its 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 foreign, 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. The
Common Stock underlying the Representative’s Units, the
Representative’s Rights and the Representative’s
Warrants have been
reserved for issuance upon the exercise of the
Representative’s Purchase Option upon payment of the
consideration therefore, and when issued in accordance with the
terms thereof, will be duly and validly authorized, 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 Representative’s Purchase Option, the
Representative’s Units, the shares of Common Stock underlying
the Representative’s Units, the Representative’s Rights
and the Representative’s Warrants conform in all material
respects to the descriptions thereof contained in the Registration
Statement, the Statutory Prospectus and the Prospectus, as the case
may be.
2.8.2.4. The
Private Units and the
shares of Common Stock (the “Private Shares”), Rights (the
“Private
Rights”) and Warrants included within the Private
Units (the “Private
Warrants”) have been duly authorized and reserved for
issuance and when issued and paid for in accordance with the
Subscription Agreement, 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 Private
Units,
Private Shares, Private Rights and Private Warrants 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 Private Units, Private Shares,
Private Rights and Private Warrants has been duly and validly
taken. The Private Units, Private Shares,
Private Rights and Private Warrants conform in all material respects
to the descriptions thereof contained in the Registration
Statement, the Statutory Prospectus and the Prospectus, as the case
may be.
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2.8.3. No
Integration. Neither the Company nor any of its affiliates
has, prior to the date hereof, made any offer or sale of any
securities which are required to be “integrated”
pursuant to the Act or the Regulations with the offer and sale of
the Public Securities pursuant to the Registration
Statement.
2.9.
Registration Rights of Third
Parties. Except as set forth in the Registration
Statement, the Statutory Prospectus and 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.
2.10. Validity
and Binding Effect of Agreements. This Agreement, the
Trust Agreement, the Subscription Agreement, the Escrow Agreement,
the Services Agreement (as defined in Section 2.24.7 below),
the Business Combination Marketing Agreement (as defined in Section
2.27 below), the Rights Agreement (as defined in Section 2.29
below), the Warrant Agreement (as defined in Section 2.28 below),
the Registration Rights Agreement (as defined in Section 2.24.6)
and the Representative’s Purchase Option have been duly and
validly authorized by the Company and, when executed and delivered
by the Company and the other parties thereto, will constitute 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 foreign, 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.
2.11. No
Conflicts, etc. The execution, delivery, and
performance by the Company of this Agreement, the Trust Agreement,
the Subscription Agreement, the Escrow Agreement, the Services
Agreement, the Business Combination Marketing Agreement, the Rights
Agreement, the Warrant Agreement, the Registration Rights Agreement
and the Representative’s Purchase Option, 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 or violation of, or
conflict with any of the terms and provisions of, or constitute a
default under, or 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,
obligation, condition, covenant or instrument to which the Company
is a party or bound or to which its property is subject except
pursuant to the Trust Agreement; (ii) result in any violation of
the provisions of the Certificate of Incorporation or Bylaws of the
Company (collectively, the “Charter Documents”); or (iii)
violate any existing applicable statute, 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 properties, business or assets.
2.12. No
Defaults; Violations. No material default or violation
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 Charter
Documents or in violation of any 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.
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2.13. Corporate
Power; Licenses; Consents.
2.13.1. 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 for the purposes
described in the Registration Statement, the Statutory Prospectus
and the Prospectus. The disclosures in the Registration
Statement, the Statutory Prospectus and the Prospectus concerning
the effects of foreign, 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. Since its
formation and except as described in the Registration Statement,
the Company has conducted no business and has incurred no
liabilities other than in connection with its formation and in
furtherance of the Offering.
2.13.2. 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 consents,
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, foreign or domestic, is required for the valid issuance, sale
and delivery, of the Public Securities and Representative’s
Securities and the consummation of the transactions and agreements
contemplated by this Agreement, the Trust Agreement, the
Subscription Agreement, the Escrow Agreement, the Services
Agreement, the Business Combination Marketing Agreement, the Rights
Agreement, the Warrant Agreement, the Registration Rights Agreement
and the Representative’s Purchase Option and as contemplated by the
Registration Statement, the Statutory Prospectus and Prospectus,
except with respect to applicable foreign, federal and state
securities laws and the rules and regulations promulgated by the
Financial Industry Regulatory Authority, Inc. (“FINRA”).
2.14. D&O
Questionnaires. To the Company’s knowledge, all
information contained in the questionnaires (the
“Questionnaires”)
completed by each of the Company’s officers, directors, 5%
beneficial owners and owners of unregistered securities acquired
within the past 180 days (the “Respondents”) immediately prior to
the initial filing of the Registration Statement and provided to
the Representative, as such Questionnaires may have been updated
from time to time and confirmed by each of the Respondents, as well
as the biographies previously provided to the Representative, is
true and correct and the Company has not become aware of any
information which would cause the information disclosed in the
Questionnaires to become inaccurate and incorrect.
2.15. Litigation;
Governmental Proceedings. There is no action, suit,
proceeding, inquiry, arbitration, investigation, litigation or
governmental proceeding pending or, to the Company’s
knowledge, threatened against, or involving the Company or, to the
Company’s knowledge, any of the Respondents, which has not
been disclosed in the Registration Statement, the Statutory
Prospectus and the Prospectus.
2.16. 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 jurisdiction 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 condition (financial or otherwise), prospects, earnings,
business or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set
forth in or contemplated in the Statutory Prospectus and the
Prospectus (exclusive of any supplement thereto) (a
“Material Adverse
Effect”).
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2.17. No
Consideration of a Business Combination. Prior to the date
hereof, no Respondent has, and as of the Closing, the Company and
such Respondents will not have: (a) had any specific Business
Combination under consideration; or (b) directly or indirectly,
contacted any prospective target business which the Company may
seek to acquire (each, a “Target Business”) or had any
substantive discussions, formal or otherwise, with respect to
effecting any potential Business Combination with the
Company.
2.18. Transactions
Affecting Disclosure to FINRA.
2.18.1.
To the Company’s knowledge, all information contained in the
questionnaires (the “FINRA
Questionnaires”) completed by each of the Respondents
and provided to the Representative, as such FINRA Questionnaires
may have been updated from time to time and confirmed by each of
the Respondents, is true and correct and the Company has not become
aware of any information which would cause the information
disclosed in the FINRA Questionnaires to become inaccurate and
incorrect.
2.18.2. Except
as described in the Registration Statement, the Statutory
Prospectus and the Prospectus, there are no claims, payments,
arrangements, agreements or understandings relating to the payment
of a finder’s, consulting or origination fee by the Company
or any Respondent with respect to the sale of the Public Securities
hereunder or any other arrangements, agreements or understandings
of the Company or, to the Company’s knowledge, any Respondent
that may affect the Underwriters’ compensation, as determined
by FINRA.
2.18.3. Except
as described herein or in the Registration Statement, the Statutory
Prospectus and the Prospectus, the Company has not made any direct
or indirect payments (in cash, securities or otherwise) to: (i) 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, within the 180-day period prior to the
initial filing date of the Registration Statement with the
Commission.
2.18.4. To
the Company’s knowledge, except as set forth in the FINRA
Questionnaires, no Respondent is a member of FINRA, or a person
associated or affiliated with a member of FINRA.
2.18.5. To
the Company’s knowledge, except as set forth in the FINRA
Questionnaires, no Respondent is an owner of stock or other
securities of any member of FINRA (other than securities purchased
on the open market).
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2.18.6.
To the Company’s knowledge, except
as set forth in the FINRA Questionnaires, no Respondent has made a
subordinated loan to any member of FINRA.
2.18.7. No
proceeds from the sale of the Public Securities or Private
Units (excluding
underwriting compensation) will be paid to any FINRA member, or any
persons associated or affiliated with a member of FINRA, except as
specifically authorized herein.
2.18.8. The
Company has not issued any warrants or other securities, or granted
any options, directly or indirectly to anyone who is a potential
underwriter in the Offering or a related person (as defined by
FINRA rules) of such an underwriter within the 180-day period prior
to the initial filing date of the Registration Statement with the
Commission, except as disclosed in the Registration Statement, the
Statutory Prospectus and the Prospectus.
2.18.9. To
the Company’s knowledge, except as set forth in the FINRA
Questionnaires, no person to whom securities of the Company have
been privately issued within the 180-day period prior to the
initial filing date of the Registration Statement with the
Commission has any relationship or affiliation or association with
any member of FINRA.
2.18.10. To
the Company’s knowledge, no FINRA member intending to
participate in the Offering has a conflict of interest (as defined
by FINRA rules) with the Company.
2.18.11. Except
with respect to the Representative in connection with the Offering,
the Company has not entered into any agreement or arrangement
(including, without limitation, any consulting agreement or any
other type of agreement) during the 180-day period prior to the
initial filing date of the Registration Statement with the
Commission, which arrangement or agreement provides for the receipt
of any item of value and/or the transfer or issuance of any
warrants, options, or other securities from the Company to a FINRA
member, any person associated with a member (as defined by FINRA
rules), any potential underwriters in the Offering and/or any
related persons.
2.19. Taxes.
2.19.1.
There are no transfer taxes or other similar fees or charges under
U.S. federal law or the laws of any U.S. state or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance or sale by
the Company of the Public Securities.
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2.19.2.
The Company has filed all U.S. federal, state and local tax returns
that are required to be a filed or has requested extensions
thereof, except in any case in which the failure to so file would
not have a Material Adverse Effect, and has paid all taxes required
to be paid by it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing in due and
payable, except for any such assessment, fine or penalty that is
currently being contested in good faith or as would not have a
Material Adverse Effect.
2.20. Foreign
Corrupt Practices Act. Neither the Company nor any of
the Respondents or any other person acting on behalf of the Company
is aware of or has taken any action, directly or indirectly, that:
(i) would result in a violation by such persons of the Foreign
Corrupt Practices Act of 1977, as amended, and the rules and
regulations thereunder (the “FCPA”) or otherwise subject the
Company to any damage or penalty in any civil, criminal or
governmental litigation or proceeding; (ii) if not done in the
past, might reasonably be expected to have had a Material Adverse
Effect or (iii) if not continued in the future, might reasonably be
expected to materially and adversely affect the assets, business or
operations of the Company, including, without limitation, 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). 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. Currency
and Foreign Transactions Reporting Act. The operations of
the Company are and have been conducted at all times in material
compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transaction Reporting Act
of 1970, as amended, the money laundering statutes of all
applicable jurisdictions, the rules and regulations thereunder and
any related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively,
the “Money Laundering
Laws”) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company with respect to the Money
Laundering Laws is pending or, to the best knowledge of the
Company, threatened.
2.22. Bank
Secrecy Act; Money Laundering; Patriot Act. Neither the Company, nor to the Company’s
knowledge, any Respondent, has violated: (i) the Bank
Secrecy Act, as amended, (ii) the Money Laundering Laws or (iii)
the Uniting and Strengthening of America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT
ACT) Act of 2001, and/or the rules and regulations promulgated
under any such law, or any successor law.
2.23. Officers’
Certificate. Any certificate signed by any duly
authorized officer of the Company and delivered to the
Representative or to its counsel shall be deemed a representation
and warranty by the Company to the Underwriters as to the matters
covered thereby.
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2.24. Agreements
With Company Affiliates and Others.
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 provision may be limited under foreign, 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) in the
form annexed as an exhibit to the Registration Statement (the
“Insider
Letters”), pursuant to which each of the Respondents
agrees to certain matters, including but not limited to, the voting
of Common Stock held by them and certain matters described as being
agreed to by them under the “Proposed Business”
section of the Registration Statement, the Statutory
Prospectus and Prospectus.
2.24.2. Subscription
Agreement. The Sponsor has executed and delivered
a subscription agreement, the form of which is annexed as an
exhibit to the Registration Statement (the
“Subscription
Agreement”), pursuant to
which the Sponsor has agreed, among other
things, to purchase on the Closing Date the Private
Units in
the Private Placement.
2.24.3.
Escrow
Agreement. The Company has caused the Sponsor to enter
into an escrow agreement (the “Escrow Agreement”) with CST&T
substantially in the form filed as an exhibit to the Registration
Statement whereby the Founder’s Shares will be held in escrow
by CST&T for a period (the “Escrow Period”) commencing on the
Effective Date and expiring on the one year anniversary of the
consummation of the Business Combination (subject to certain
earlier releases of such Founder’s Shares as provided for in
the Escrow Agreement and described in the Prospectus). During the
Escrow Period, such parties shall be prohibited from selling or
otherwise transferring such Founder’s Shares, except in
certain limited circumstances set forth in the Escrow Agreement and
described in the Prospectus. To the Company’s knowledge, the
Escrow Agreement is enforceable against the Sponsor 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, an agreement or
instrument to which the Sponsor is a party.
2.24.4. Non-Competition/Solicitation.
To the Company’s knowledge, no Respondent is subject to any
non-competition agreement or non-solicitation agreement with any
employer or prior employer which could materially affect such
Respondent’s ability to be and act in the capacity of a
director or officer of the Company, as applicable.
2.24.5. Loans
and Advances. The Sponsor and the Company’s executive
officers have made advances and loans to the Company in an
aggregate amount not to exceed $175,000, as described in the
Registration Statement (the “Insider Advances”). The Insider
Advances do not bear any interest and are repayable by the Company
on the consummation of the Offering.
2.24.6. Registration
Rights Agreement. The Company and the Sponsor have entered
into a registration rights agreement (“Registration Rights Agreement”)
substantially in the form annexed as an exhibit to the Registration
Statement, whereby the Sponsor will be entitled to certain
registration rights with respect to its securities, as set forth in
such Registration Rights Agreement and described more fully in the
Registration Statement.
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2.24.7. Administrative
Services. The Company has entered into an agreement
(“Services
Agreement”) with the Sponsor substantially in the form
annexed as an exhibit to the Registration Statement pursuant to
which the Sponsor will make available to the Company, on the terms
and subject to the conditions set forth therein, general and
administrative services including office space, utilities and
secretarial support for the Company’s use for $10,000 per
month payable until the earlier of the consummation by the Company
of a Business Combination or the liquidation of the Trust
Account.
2.25. Investment
Management Trust Agreement. The Company has entered
into the Trust Agreement with respect to certain proceeds of the
Offering and the Private Placement substantially in the form filed
as an exhibit to the Registration Statement, pursuant to which the
funds held in the Trust Account may be released under limited
circumstances. The Trust Agreement shall not be amended, modified
or otherwise changed in any way that modifies the rights or
obligations of the Company without the prior written consent of the
Representative.
2.26.
Intentionally
Omitted.
2.27.
Business
Combination Marketing Agreement. The Company and the Representative have entered
into a separate business combination marketing agreement
substantially in the form filed as an exhibit to the Registration
Statement (the “Business Combination Marketing
Agreement”).
2.28. Warrant
Agreement. The Company has
entered into a warrant agreement with respect to the Warrants,
Representative’s Warrants and Private Warrants with CST&T
substantially in the form filed as an exhibit to the Registration
Statement (the “Warrant
Agreement”).
2.29.
Rights
Agreement. The Company has
entered into a rights agreement with respect to the Rights, the
Representative’s Rights and Private Rights with CST&T
substantially in the form filed as an exhibit to the Registration
Statement (the “Rights
Agreement”).
2.30. Investments.
No more than 45% of the “value” (as defined in
Section 2(a)(41) of the Investment Company Act of 1940
(“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 Government
Securities.
2.31. Investment
Company Act. The Company is not required, and upon the
issuance and sale of the Public Securities as herein contemplated
and the application of the net proceeds therefrom as described in
the Prospectus will not be required, to register as an
“investment company” under the Investment Company
Act.
2.32. Subsidiaries.
The Company does not own an interest in any corporation,
partnership, limited liability company, joint venture, trust or
other business entity.
2.33. Related
Party Transactions. No relationship, direct or
indirect, exists between or among any of the Company or any
Respondent, on the one hand, and any customer or supplier of the
Company or any Respondent, on the other hand, which is required by
the Act, the Exchange Act or the Regulations to be described in the
Registration Statement, the Statutory Prospectus and the
Prospectus, which is not so described as required. There are no
outstanding loans, advances or guarantees of indebtedness by the
Company to or for the benefit of any of the officers or directors
of the Company or any of their respective family members, except as
disclosed in the Registration Statement, the Statutory Prospectus
and the Prospectus. The Company has not extended or maintained
credit, arranged for the extension of credit, or renewed an
extension of credit, in the form of a personal loan to or for any
director or officer of the Company.
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2.34. No
Influence. The Company has not offered, or caused the
Underwriters to offer, the Firm Units to any person or entity with
the intention of unlawfully influencing: (a) a customer or supplier
of the Company or any affiliate of the Company to alter the
customer’s or supplier’s level or type of business with
the Company or such affiliate or (b) a journalist or publication to
write or publish favorable information about the Company or any
such affiliate.
2.35.
Xxxxxxxx-Xxxxx.
The Company is in material compliance with the provisions of the
Xxxxxxxx-Xxxxx Act of 2002, as amended (“SOX”), and the rules and regulations
promulgated thereunder and related or similar rules and regulations
promulgated by any governmental or self-regulatory entity or
agency, that are applicable to it as of the date
hereof.
2.36. Nasdaq
Eligibility. As of the Effective Date, the Public Securities
have been approved for listing on the Nasdaq Capital Markets
(“NASDAQ”),
subject to official notice of issuance and evidence of satisfactory
distribution. There is and has been no failure on the part of the
Company or any of the Company's directors or officers, in their
capacities as such, to comply with (as and when applicable), and
immediately following the effectiveness of the Registration
Statement the Company will be in compliance with, the NASDAQ
Marketplace Rules, as amended.
2.37.
Emerging Growth
Status. From the date of the Company’s formation
through the date hereof, the Company has been and is an
“emerging growth company,” as defined in Section 2(a)
of the Act (an “Emerging
Growth Company”).
2.38.
Free-Writing Prospectus
and Testing-the-Waters. The Company has not made any offer
relating to the Public Securities that would constitute an issuer
free writing prospectus, as defined in Rule 433 under the Act, or
that would otherwise constitute a “free writing
prospectus” as defined in Rule 405. The Company (a) has not
engaged in any Testing-the-Waters Communication other than
Testing-the-Waters Communications with the consent of the
Representative with entities that are qualified institutional
buyers within the meaning of Rule 144A under the Securities Act or
institutions that are accredited investors within the meaning of
Rule 501 under the Securities Act and (b) has not authorized anyone
to engage in Testing-the-Waters Communications other than its
officers and the Representative and individuals engaged by the
Representative. The Company has not distributed any Written
Testing-the-Waters Communications other than those listed on
Schedule B hereto. “Testing-the-Waters Communication”
means any oral or written communication with potential investors
undertaken in reliance on Section 5(d) of the Act.
2.39. Disclosure
Controls and Procedures. The Company maintains effective
“disclosure controls and procedures” (as defined under
Rule 13a-15(e) under the Exchange Act to the extent required by
such rule).
2.40. [Intentionally
Omitted].
2.41.
Definition
of “Knowledge”. As used in herein, the term
“knowledge of the
Company” (or similar language) shall mean the
knowledge of the Company’s executive officers and directors,
with the assumption that such officers and directors shall have
made reasonable and diligent inquiry of the matters
presented.
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 shall not file any such amendment or
supplement to which the Representative shall reasonably object in
writing.
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3.2. Federal
Securities Laws.
3.2.1. Compliance.
During the time when a prospectus is required to be delivered under
the Act, the Company will use all reasonable efforts to comply with
all requirements 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 Statutory Prospectus
and the Prospectus, as then amended or supplemented 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 during such period
to amend the Registration Statement or amend or supplement the
Statutory Prospectus and 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 to the Registration Statement or amendment or
supplement to the Statutory Prospectus and Prospectus (at the
expense of the Company) so as to correct such statement or omission
or effect such compliance.
3.2.2.
Filing of Final
Prospectus. The Company will promptly file the
Prospectus (in form and substance satisfactory to the
Representative) with the Commission pursuant to the requirements of
Rule 424 of the Regulations.
3.2.3.
Exchange Act
Registration. For a period of five years from the
Effective Date (except in connection with a going private
transaction), or until such earlier time upon which the Trust
Account is to be liquidated if a Business Combination has not been
consummated as required by its Charter Documents (the
“Termination
Date”), the Company (i) will use its best efforts to
maintain the registration of the Common Stock, Rights (until the
consummation of the Business Combination) and Warrants under the
provisions of the Exchange Act and (ii) will not deregister the
Common Stock, Rights (prior to the consummation of the Business
Combination) or Warrants under the Exchange Act without the prior
written consent of the Representative.
3.2.4.
Free Writing
Prospectuses. The Company agrees that it will not make any
offer relating to the Public Securities that would constitute an issuer
free writing prospectus, as defined in Rule 433 under the
Act.
3.2.5.
Xxxxxxxx-Xxxxx
Compliance. As soon as it is
legally required to do so, the Company shall take all
actions necessary to obtain and thereafter maintain material
compliance with each applicable provision of SOX and the rules and
regulations promulgated thereunder and related or similar rules and
regulations promulgated by any other governmental or
self-regulatory entity or agency with jurisdiction over the
Company.
3.3. Emerging
Growth Company Status. The Company will promptly notify the
Representative if the Company ceases to be an Emerging Growth
Company at any time prior to the earlier of five years after the
consummation of the Company’s initial Business Combination,
or the liquidation of the Trust Account if a Business Combination
is not consummated by the Termination Date.
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3.4. [Intentionally
Omitted].
3.5. Delivery
of Materials to Underwriters. The Company will deliver
to each of the several Underwriters, without charge and from time
to time during the period when a prospectus is required to be
delivered under the Act or the Exchange Act, such number of copies
of each Statutory Prospectus, the Prospectus and all amendments and
supplements to such documents as such Underwriters may reasonably
request.
3.6. 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
suspending the effectiveness of the Registration Statement, or any
post-effective amendment thereto or preventing or suspending the
use of any Preliminary Prospectus or the Prospectus or of the
initiation, or the threatening, of any proceeding for that purpose;
(iii) of the issuance by any foreign or state securities commission
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 this
Section 3.6 hereof that, in the judgment of the Company or its
counsel, makes any statement of a material fact made in the
Registration Statement, the Statutory Prospectus or the Prospectus
untrue or that requires the making of any changes in the
Registration Statement, the Statutory Prospectus and Prospectus in
order to make the statements therein, (with respect to the
Prospectus and the Statutory Prospectus and in light of the
circumstances under which they were made), not misleading. If
the Commission or any foreign or state securities commission shall
enter a stop order or suspend such qualification at any time, the
Company will make every reasonable effort to obtain promptly the
lifting of such order.
3.7. Review
of Financial Statements. Until the earlier of five
years from the Effective Date, or until the liquidation of the
Trust Account if a Business Combination is not consummated by the
Termination Date, 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.
3.8. Affiliated
Transactions.
3.8.1. Business
Combinations. The Company will not consummate a
Business Combination with an entity that is affiliated with any
Respondent unless in each case the Company obtains an opinion from
an independent investment banking firm or another independent firm
that regularly renders fairness opinions on the type of target
business the Company is seeking to acquire that the Business
Combination is fair to the Company from a financial point of view
and a majority of the Company’s disinterested and independent
directors (if there are any) approve such transaction.
3.8.2.
Compensation.
Except as disclosed in the Registration Statement, the Company
shall not pay any Respondent or any of their affiliates any fees or
compensation for services rendered to the Company prior to, or in
connection with, either this Offering or the Business
Combination.
3.9.
Secondary Market Trading and Standard
& Poor’s. If the Company does not maintain the
listing of the Public Securities on NASDAQ or another national
securities exchange, the Company will (i) 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, (ii) take such commercially
reasonable steps as may be necessary to obtain a secondary market
trading exemption for the Company’s securities in the State
of California and (iii) 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; provided that no qualification shall be required in
any jurisdiction where, as a result thereof, the Company would be
subject to service of general process or to taxation as a foreign
corporation doing business in such jurisdiction.
3.10.
Investor Relations
Firm. Promptly after the execution of a definitive agreement
for a Business Combination, the Company shall retain an investor
relations firm with the expertise necessary to assist the Company
both before and after the consummation of the Business Combination
for a term to be agreed upon by the Company and the
Representative.
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 and dissolved, the Company will furnish
to the Representative 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 Current Report on Form 8-K and any 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; and (v) 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; provided
that the Representative shall sign, if requested by the Company, a
Regulation FD compliant confidentiality agreement which is
reasonably acceptable to the Representative and its counsel in
connection with the Representative’s receipt of such
information. Documents filed with the Commission pursuant to
Electronic Data Gathering, Analysis and Retrieval System
(“XXXXX”) shall
be deemed to have been delivered to the Representative pursuant to
this section.
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3.11.2. For
a period of five years following the Effective Date or until such
earlier time upon which the Company is required to be liquidated,
the Company shall retain a transfer agent and warrant agent
acceptable to the Representative. CST&T is acceptable to the
Underwriters.
3.12. Payment
of Expenses. 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, or such later date as may be
agreed to by the Representative in its sole discretion, all fees
and expenses incident to the performance of the obligations of the
Company under this Agreement, including, but not limited to: (i)
the preparation, printing, filing and mailing (including the
payment of postage with respect to such mailing) of the
Registration Statement, the Statutory Prospectus, and the final
Prospectus and mailing of this Agreement and related documents,
including the cost of all copies thereof and any amendments thereof
or supplements thereto supplied to the Underwriters in quantities
as may be required by the Underwriters; (ii) the printing,
engraving, issuance and delivery of the Units, Common Stock, Rights
and Warrants included
in the Units, including any transfer or other taxes payable
thereon; (iii) NASDAQ filing fees or, if necessary, the
qualification of the Public Securities under state or foreign
securities or Blue Sky laws; (iv) fees and expenses (including
legal fees of the Representative’s counsel not to exceed
$15,000) incurred in registering the Offering with FINRA; (v) fees
and disbursements of the transfer, rights agent and warrant agent;
(vi) the preparation and delivery of transaction lucite cubes or
similar commemorative items in a style and quantity as reasonably
requested by the Representative (not
to exceed $3,000); (vii)
all costs and expenses of the Company associated with “road
show” marketing and “due diligence” trips for the
Company’s management to meet with prospective investors,
including without limitation, all travel, food and lodging expenses
associated with such trips incurred by the Company or such
management; 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 3.12. The Company also
agrees that it will 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 (not to exceed $3,500 per individual
or $21,000 in the aggregate). If the Offering is
consummated, the Representative may deduct from the net proceeds of
the Offering payable to the Company on the Closing Date the
expenses set forth above (which shall be mutually agreed upon
between the Company and the Representative prior to Closing) to be
paid by the Company to the Representative and others. If the
Offering is not consummated for any reason (other than a breach by
the Representative of any of its obligations hereunder), then the
Company shall reimburse the Representative in full for its
out-of-pocket accountable expenses actually incurred through such
date, including, without limitation, reasonable fees and
disbursements of counsel to the Representative. It is acknowledged
that the Company has already paid $25,000 to the Representative. To
the extent that the Representative’s out-of-pocket expenses
are less than this advance, the Representative shall refund the
excess to the Company.
3.13. Application
of Net Proceeds. The Company will apply the net
proceeds from this Offering received by it in a manner
substantially consistent with the application described under the
caption “Use of Proceeds” in the
Prospectus.
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3.14. 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
sixteenth full calendar month following the Effective Date, an
earnings 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.
3.15. Notice
to FINRA.
3.15.1. Assistance
with Business Combination. 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 Business Combination
candidate or to provide any similar Business Combination-related
services, the Company will provide the following information (the
“Business Combination
Information”) to the Representative:
(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 Business Combination-related 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 5110 of FINRA’s 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. Upon the
Company’s delivery of the Business Combination Information to
the Representative, the Company hereby expressly authorizes the
Representative to provide such information directly to FINRA as a
result of representations the Representative have made to FINRA in
connection with the Offering.
3.15.2. Broker/Dealer.
In the event the Company intends to register as a broker/dealer,
merge with or acquire a registered broker/dealer, or otherwise
become a member of FINRA, it shall promptly notify the
Representative.
3.16.
Stabilization. Neither the
Company, nor, to its knowledge, any of its employees, officers,
directors or stockholders (without the consent of the
Representative) 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.
3.17. Internal
Controls. From and after the Closing Date, the Company
will maintain a system of internal accounting controls sufficient
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
GAAP and to maintain accountability 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.
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3.18. Accountants.
For a period of five years from the Effective Date or until such
earlier time upon which the Trust Account is required to be
liquidated, the Company shall retain Xxxxxx or other independent
public accountants reasonably acceptable to the
Representative.
3.19. Form
8-K’s. The Company has retained
Xxxxxx to audit the
balance sheet of the Company as of the Closing Date (the
“Audited Balance
Sheet”) reflecting the receipt by the Company of the
proceeds of the Offering and the Private Placements. Within
four (4) Business Days of the Closing Date, the Company shall file
a Current Report on Form 8-K with the Commission, which Report
shall contain the Company’s Audited Balance Sheet. If the
Over-Allotment Option has not been exercised on the Effective Date,
the Company will also file an amendment to the Form 8-K, or a new
Form 8-K, to provide updated financial information of the Company
to reflect the exercise and consummation of the Over-Allotment
Option.
3.20. FINRA.
Until the Option Closing Date, if any, the Company shall advise the
Representative 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 Public
Securities.
3.21. 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.
3.22. Investment
Company. The Company shall cause the proceeds of the
Offering to be held in the Trust Account to be invested only as set
forth in the Trust Agreement as in effect on the date hereof and
disclosed 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.
3.23. Press
Releases. The Company agrees that it will not issue press
releases or engage in any other publicity, without the
Representative’s prior written consent (not to be
unreasonably withheld), for a period of twenty-five (25) days after
the Closing Date; provided that in no event shall the Company be
prohibited from issuing any press release or engaging in any other
publicity required by law.
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3.24. Electronic
Prospectus. The Company shall cause to be prepared and
delivered to the Representative, at its expense, promptly, but in
no event later than two (2) Business Days from the effective date
of this Agreement, an Electronic Prospectus to be used by the
Underwriters in connection with the Offering. As used herein, the
term “Electronic
Prospectus” means a form of prospectus, and any
amendment or supplement thereto, that meets each of the following
conditions: (i) it shall be encoded in an electronic format,
satisfactory to the Representative, that may be transmitted
electronically by the other Underwriters to offerees and purchasers
of the Common Stock for at least the period during which a
Prospectus relating to the Common Stock is required to be delivered
under the Act; (ii) it shall disclose the same information as the
paper prospectus and prospectus filed pursuant to XXXXX, except to
the extent that graphic and image material cannot be disseminated
electronically, in which case such graphic and image material shall
be replaced in the electronic prospectus with a fair and accurate
narrative description or tabular representation of such material,
as appropriate; and (iii) it shall be in or convertible into a
paper format or an electronic format, satisfactory to the
Representative, that will allow recipients thereof to store and
have continuously ready access to the prospectus at any future
time, without charge to such recipients (other than any fee charged
for subscription to the Internet as a whole and for on-line time).
The Company hereby confirms that it has included or will include in
the Prospectus filed pursuant to XXXXX or otherwise with the
Commission and in the Registration Statement at the time it was
declared effective an undertaking that, upon receipt of a request
by an investor or his or her representative within the period when
a prospectus relating to the Common Stock is required to be
delivered under the Act, the Company shall transmit or cause to be
transmitted promptly, without charge, a paper copy of the
Prospectus.
3.25. Future
Financings. The Company agrees that neither it, nor any
successor or subsidiary of the Company, will consummate any public
or private equity or debt financing prior to or in connection with
the consummation of a Business Combination, unless all investors in
such financing expressly waive, in writing, any rights in or claims
against the Trust Account.
3.26. NASDAQ
Maintenance. Until the consummation of a Business
Combination, the Company will use commercially reasonable efforts
to maintain the listing by NASDAQ of the Units and the Common
Stock, Rights and Warrants included within the Units.
3.27. Private
Placement Proceeds. On the
Closing Date, the Company shall cause to be deposited
$2,500,000 of proceeds from the Private Placement into
the Trust Account. On the Option Closing Date, if any, the Company
shall cause to be deposited an amount of additional proceeds from
the additional Private Units sold
on the Option Closing Date into the Trust Account such that the
amount of funds in the Trust Account shall be $10.00 per Public
Share sold in the Offering.
3.28.
Reservation of
Shares. The Company will reserve and keep
available that maximum number of its authorized but unissued
securities which are issuable pursuant to the Rights, Warrants, the
Private Rights, the Private Warrants, the Representative’s
Rights and the Representative’s Warrants outstanding from
time to time.
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3.29. Testing-the-Waters
Communications. If at any time
following the distribution of any Written Testing-the-Waters
Communication, there occurred or occurs an event or development as
a result of which such Written Testing-the-Waters Communication
included or would include any untrue statement of a material fact
or omitted or would omit to state any material fact necessary to
make the statements therein in light of the circumstances existing
at that subsequent time, not misleading, the Company will promptly
(i) notify the Representative so that use of the Written
Testing-the-Waters Communication may cease until it is amended or
supplemented; (ii) amend or supplement, at its own expense, such
Written Testing-the-Waters Communication to eliminate or correct
such untrue statement or omission; and (iii) supply any amendment
or supplement to the Representative in such quantities as may be
reasonably requested.
4. Conditions.
4.1. Conditions
of Underwriters’ Obligations. The obligations of
the several Underwriters to purchase and pay for the Public
Securities, 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 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:
4.1.1. Regulatory
Matters.
4.1.1.1. 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 the
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.
4.1.1.2. 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.
4.1.1.3. No
Commission Stop Order. At the
Closing Date, the Commission has not issued any order or threatened
to issue any order preventing or suspending the use of any
Preliminary Prospectus, the Prospectus or any part thereof, and has
not instituted or, to the Company’s knowledge, threatened to
institute any proceedings with respect to such an
order.
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4.1.1.4. NASDAQ
Listing. The Public Securities shall have been approved for
listing on NASDAQ, subject to official notice of issuance and
evidence of satisfactory distribution.
4.1.2. Company
Counsel Matters.
4.1.2.1. Opinion
of Company Counsel. On each of the Closing Date or the
Option Closing Date, if any, the Representative shall have received
the favorable opinions (along with negative assurance letters) of
Akerman LLP, counsel to the Company, addressed to the
Representative as representative for the several Underwriters and
in form mutually agreed to by the Company and the
Representative.
4.1.2.2. Reliance.
In rendering such opinions, 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 the Representative) of other
counsel reasonably acceptable to the Representative, 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 jurisdiction 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 opinions 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.
4.1.3. Cold
Comfort Letter. At the time this Agreement is
executed, and at the Closing Date and Option Closing Date, if any,
the Representative shall have received a letter, addressed to the
Representative as representative for the several Underwriters 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 from
Xxxxxx dated,
respectively, as of the date of this Agreement and as of the
Closing Date and Option Closing Date, if any:
(i) Confirming
that they are independent accountants 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 Registration Statement and the
Prospectus, provided to the Company any non-audit services, as such
term is used in Section 10A(g) of the Exchange
Act;
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(ii) Stating
that in their opinion the financial statements of the Company
included in the Registration Statement and the 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 limited review which included 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, nothing has come to their attention which would lead
them to believe that: (a) the unaudited financial statements of the
Company included in the Registration Statement and the Prospectus
do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the Regulations
or are not fairly presented in conformity with GAAP applied on a
basis substantially consistent with that of the audited financial
statements of the Company included in the Registration Statement,
the Statutory Prospectus and the Prospectus; or (b) at a date
immediately prior to the Effective Date or Closing Date, as the
case may be, there was any 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 30, 2017 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, and (c) during the period from
September 18, 2017 to a specified date immediately prior to the
Effective Date or Closing Date, as the case may be, there was any
changes in revenues, net earnings (losses), or net earnings
(losses) per share of Common Stock, in each case as compared with
the Statement of Operations for the period from September 18, 2017
(inception) to September 30, 2017 included in the Registration
Statement, or, if there was any such change, setting forth the
amount of such change;
(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
Registration Statement 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; and
(v) Statements
as to such other matters incident to the transaction contemplated
hereby as the Representative may reasonably request.
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4.1.4. Officers’
Certificates.
4.1.4.1. Officers’
Certificate. As of 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,
President or Chief Financial Officer (in their capacities as such),
respectively, to the effect that the Company has performed all
covenants and complied with all conditions required by this
Agreement to be performed or complied with by the Company prior to
and as of the Closing Date and that the conditions set forth in
this Section 4 hereof have been satisfied as of such date and
that, as of Closing Date, 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.
4.1.4.2. Secretary’s
Certificate. As of 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 President of the
Company, respectively, certifying: (i) that the Amended and
Restated Certificate of Incorporation and Bylaws 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 Offering 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 NASDAQ; 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.
4.1.5. No
Material Changes. Prior to 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 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 Statutory Prospectus and Prospectus; (ii) no action suit or
proceeding, at law or in equity, shall have been pending or
threatened against the Company or any Respondent before or by any
court or foreign, federal or state commission, board or other
administrative 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, the Statutory
Prospectus and Prospectus; (iii) no stop order shall have been
issued under the Act against the Company and no proceedings
therefor shall have been initiated or threatened by the Commission;
and (iv) the Registration Statement, the Statutory Prospectus 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 none of the Registration Statement, the
Statutory Prospectus or the Prospectus, or 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 the case of
the Statutory Prospectus and Prospectus, in light of the
circumstances under which they were made), not
misleading.
4.1.6. Delivery
of Agreements and Securities. On the Effective Date, the
Company shall have delivered to the Representative executed copies
of the Trust Agreement, the Subscription Agreement, the Escrow
Agreement, the Services Agreement, the Business Combination
Marketing Agreement, the Rights Agreement, the Warrant Agreement,
the Registration Rights Agreement and all of the Insider Letters.
On the Closing Date, the Company shall have delivered to the
Representative the Representative’s Purchase Option and the
Representative’s Shares.
4.1.7. Private
Units. On the Closing Date and the Option Closing Date, as
applicable, the Private Units have been
purchased as provided for in the Subscription Agreement and
the purchase price for such securities shall be deposited into the
Trust Account.
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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, partners and employees and
each person, if any, who controls any such Underwriter or Selected
Dealer (“Controlling
Person”) within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, and its counsel,
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 foreign, federal, state or local statute, law, rule,
regulation or ordinance or at common law or otherwise or under the
laws, rules and regulation 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); (ii) in any post-effective
amendment or amendments or any new registration statement and
prospectus relating to any of the Public Securities; or (iii) 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
foreign or state securities commission or agency, NASDAQ (in each
case other than statements contained in the section captioned
“Selling Restrictions”); 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 the Prospectus or any amendment or supplement thereof, or
in any application, as the case may be, which furnished written
information, it is expressly agreed, consists solely of the
information described in clause (ii) of the last sentence of
Section 2.3.1. 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 any loss, liability, claim, damage or expense of such
Underwriter results from the fact that a copy of the Prospectus was
not given or sent to the person asserting any such loss, liability,
claim or damage at or prior to the written confirmation of sale of
the Public Securities to such person as required by the Act and the
Regulations, and if the untrue statement or omission has been
corrected in the Prospectus, unless such failure to deliver the
Prospectus was a result of non-compliance by the Company with its
obligations under Section 3.5 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 Preliminary
Prospectus, the Registration Statement or the
Prospectus.
5.1.2. Procedure.
If any action is brought against an Underwriter or controlling
person in respect of which indemnity may be sought against the
Company pursuant to Section 5.1.1, such Underwriter 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) and payment of actual
expenses. Such Underwriter or controlling person 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 or such 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; (ii) the Company shall not have employed
counsel to have charge of the defense of such action; or (iii)
counsel to 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 and/or controlling person shall be borne by the
Company. Notwithstanding anything to the contrary contained
herein, if the Underwriter 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.
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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, and its counsel, 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 the
Registration Statement, any Preliminary Prospectus, the 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 Registration
Statement, Preliminary Prospectus, the Prospectus or any amendment
or supplement thereto or in any such application, which furnished
written information, it is expressly agreed, consists solely of the
information described in clause (ii) of the last sentence of
Section 2.3.1. In case any action shall be brought against
the Company or any other person so indemnified based on any
Preliminary Prospectus, the Registration Statement, the 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 indemnification 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 but is
unavailable, then, and in each such case, the Company and the
Underwriters shall contribute 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 are
responsible for that portion represented by the percentage that the
underwriting discount appearing on the cover page of the Prospectus
bears to the initial offering price appearing thereon and the
Company is responsible for the balance; 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. Notwithstanding the provisions of this
Section 5.3.1, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at
which the Public Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay in
respect of such losses, liabilities, claims, damages and
expenses. 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.
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5.3.2. Contribution
Procedure. Within fifteen days after receipt by any
party to this Agreement (or its representatives) 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 representatives 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.
6.
Default by an
Underwriter.
6.1.
Default Not Exceeding 10%
of Firm Units. If any Underwriter or Underwriters
shall default in its or their obligations to purchase the Firm
Units and if the number of the Firm Units with respect to which
such default relates does not exceed in the aggregate 10% of the
number of Firm Units that all Underwriters have agreed to purchase
hereunder, then such Firm 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. In the event that the
default addressed in Section 6.1 above relates to more than 10% of
the Firm Units, the Representative may, in its discretion, arrange
for it or for another party or parties to purchase such Firm Units
to which such default relates on the terms contained herein.
If within one (1) Business Day after such default relating to more
than 10% of the Firm Units the Representative does not arrange for
the purchase of such Firm Units, then the Company shall be entitled
to a further period of one (1) Business Day within which to procure
another party or parties satisfactory to the Representative to
purchase said Firm Units on such terms. In the event that
neither the Representative nor the Company arrange for the purchase
of the Firm Units to which a default relates as provided in this
Section 6, this Agreement may be terminated by the
Representative or the Company without liability on the part of the
Company (except as provided in Sections 3.12 and 5 hereof) or the
several Underwriters (except as provided in Section 5 hereof);
provided 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.
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6.3. Postponement
of Closing Date. In the event that the Firm 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 for a reasonable period, but not in
any event exceeding five (5) Business Days, in order to effect
whatever changes may thereby be made necessary in the Registration
Statement and/or the Prospectus, as the case may be, or in any
other documents and arrangements, and the Company agrees to file
promptly any amendment to, or to supplement, the Registration
Statement and/or the Prospectus, as the case may be, that in the
reasonable 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
securities.
7.
Additional
Covenants.
7.1.
Additional Shares or
Options. Except as described in the Registration
Statement, the Company hereby agrees that until the Company
consummates a Business Combination, it shall not issue any 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 Account or which vote on a Business
Combination.
7.2. Trust
Account Waiver Acknowledgments. The Company hereby agrees
that, prior to commencing its due diligence investigation of any
Target Business or obtaining the services of any vendor, it will
use its best efforts to have such Target Business or vendor
acknowledge in writing, whether through a letter of intent,
memorandum of understanding, agreement in principle 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 Account, initially in an amount of
$60,000,000 for the benefit of the Public Stockholders
and that, except for the interest earned on the amounts held in the
Trust Account that may be released to the Company for its tax
obligations, the Company may disburse monies from the Trust Account
only: (i) to the Public Stockholders in the event of the conversion
or sale of their shares upon consummation of a Business Combination
or certain amendments to the Company’s Amended and Restated
Certificate of Incorporation, (ii) to the Public Stockholders in
connection with the Company’s liquidation in the event the Company is
unable to consummate a Business Combination within the required
time period or (iii) to the Company concurrently with, or after it
consummates 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 any right, title, interest or claim of any kind in or to any
monies of the Trust Account (“Claim”) 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 Account for any reason whatsoever.
The foregoing letters shall
substantially be in the form attached hereto as Exhibit
A and B,
respectively.
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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 Respondent and the Representative and
will not allow any amendments to, or waivers of, such Insider
Letters without the prior written consent of the
Representative.
7.4. Tender
Offer, Proxy and Other Information. The Company shall
provide the Representative with copies of all proxy or tender offer
documentation and other information and all related material sent
to Public Stockholders in connection with a Business
Combination.
7.5. 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.
7.6. Presentation
of Potential Target Businesses. The Company shall
cause each of the Respondents to agree that, in order to minimize
potential conflicts of interest which may arise from multiple
affiliations, the Respondents 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 or the liquidation of the Trust Account, subject to any
pre-existing fiduciary obligations the Respondents might
have.
7.7. Target
Fair Market Value. The Company agrees that the Target
Business that it acquires must have a fair market value equal to at
least 80% of the balance in the Trust Account (excluding any taxes)
at the time of signing the definitive agreement for the Business
Combination with such Target Business. 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, cash flow
and book value. If the Board of Directors of the Company is not
able to independently determine that the target business meets such
fair market value requirement, the Company will obtain an opinion
from an unaffiliated, independent investment banking firm, or
another independent entity that commonly renders valuation opinions
on the type of Target Business the Company is seeking to acquire.
The Company is not required to obtain such an opinion 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.
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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 representations,
warranties and agreements at the Closing Date or Option Closing
Date, as applicable, and such representations, warranties and
agreements of the Underwriters and Company, including the indemnity
agreements contained in Section 5 hereof, shall remain
operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, the Company
or any controlling person, and shall survive termination 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 (7th) anniversary
of the Closing Date, 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 domestic or
international event or act or occurrence has materially disrupted
or, in the Representative’s sole 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 NYSE MKT LLC, NASDAQ or on the 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 OTC
Bulletin Board 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 war or an increase in
existing 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 sole
opinion, make it inadvisable to proceed with the delivery of the
Common Stock, (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 a
Material Adverse Effect on the Company, or such adverse material
change in general market conditions, including, without limitation,
as a result of terrorist activities after the date hereof, as in
the Representative’s sole judgment would make it
impracticable to proceed with the offering, sale and/or delivery of
the Common Stock or to enforce contracts made by the Underwriters
for the sale of the Common Stock.
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 3.12 hereof.
9.4. Indemnification.
Notwithstanding any contrary provision contained in this Agreement,
any election hereunder or any termination of this Agreement, and
whether or not this Agreement is otherwise 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. Miscellaneous.
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10.1. Notices.
All communications hereunder, except as herein otherwise
specifically provided, shall be in writing and shall be mailed by
certified mail (with return receipt), delivered by hand or
reputable overnight courier, delivered by facsimile transmission
(with printed confirmation of receipt) and confirmed, or by
electronic transmission via PDF and shall be deemed given when so
mailed, delivered, or faxed or transmitted (or if mailed, five days
after such mailing):
If to
the Representative:
EarlyBirdCapital,
Inc.
000
Xxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Fax
No.: (000) 000-0000
Attn:
Xxxxxx Xxxxxx
Email:
xxxxxxx@xxxxx.xxx
With a
copy (which shall not constitute notice) to:
Xxxxxxxx
Xxxxxx
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Fax
No.: (000) 000-0000
Attn:
Xxxxx Xxxx Xxxxxx, Esq.
Email:
xxxxxxx@xxxxxxxx.xxx
If to
the Company, to:
c/o Big
Rock Partners Sponsor, LLC
0000 X.
Xxxxxxx Xxxxxxx
Xxxxx
000
Xxxxxx
Xxxxx, Xxxxxxx 00000
Attn:
Xxxxxxx Xxxxxxxx, Chief Executive Officer
Email:
xxxxxxxxx@xxxxxxxxxxxxxxx.xxx
With a
copy (which shall not constitute notice) to:
Akerman
LLP
Three
Brickell City Centre
00
Xxxxxxxxx Xxxxxxx Xxxxxx
Xxxxx
0000
Xxxxx,
Xxxxxxx 00000
Fax
No.: (000) 000-0000
Attn:
Xxxxxxx Xxxxxxx, Esq.
Email:
xxxxxxx.xxxxxxx@xxxxxxx.xxx
10.2. 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.
10.3. Amendment.
This Agreement may only be amended by a written instrument executed
by each of the parties hereto.
10.4. 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.
10.5. 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.
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10.6. Governing
Law, Venue, etc. This Agreement
shall be governed by and construed and enforced in accordance with
the laws of the State of New York, without giving effect to
conflict of laws. Each of the Company and the Representative hereby
agrees that any action, proceeding or claim against it arising out
of, 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 exclusive. Each of the Company and the Representative 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 or the Representative, respectively,
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 10.1 hereof.
Such mailing shall be deemed personal service and shall be legal
and binding upon the Company or the Representative, respectively,
in any action, proceeding or claim. Each of the Company and the
Representative agrees that the prevailing party(ies) in any such
action shall be entitled to recover from the other party(ies) all
of its reasonable attorneys’ fees and expenses relating to
such action or proceeding and/or incurred in connection with the
preparation therefor.
10.7. 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. Delivery of a signed
counterpart of this Agreement by fax or email/.pdf transmission
shall constitute valid and sufficient delivery
thereof.
10.8. 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 affect 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.
10.9. No
Fiduciary Relationship. The Company hereby acknowledges that
the Underwriters are acting solely as underwriters in connection
with the offering of the Public Securities. The Company further
acknowledges that the Underwriters are acting pursuant to a
contractual relationship created solely by this Agreement entered
into on an arm's length basis and in no event do the parties intend
that the Underwriters act or be responsible as a fiduciary to the
Company, its management, stockholders, creditors or any other
person in connection with any activity that the Underwriters may
undertake or have undertaken in furtherance of the offering of the
Public Securities, either before or after the date hereof. The
Underwriters hereby expressly disclaim any fiduciary or similar
obligations to the Company, either in connection with the
transactions contemplated by this Agreement or any matters leading
up to such transactions, and the Company hereby confirms its
understanding and agreement to that effect. The Company and the
Underwriters agree that they are each responsible for making their
own independent judgments with respect to any such transactions,
and that any opinions or views expressed by the Underwriters to the
Company regarding such transactions, including but not limited to
any opinions or views with respect to the price or market for the
Public Securities, do not constitute advice or recommendations to
the Company. The Company hereby waives and releases, to the fullest
extent permitted by law, any claims that the Company may have
against the Underwriters with respect to any breach or alleged
breach of any fiduciary or similar duty to the Company in
connection with the transactions contemplated by this Agreement or
any matters leading up to such transactions.
[Signature
Page Follows]
EarlyBirdCapital,
Inc.
November
20, 2017
Page
36 of
36
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.
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Very Truly Yours, |
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By:
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/s/ Xxxxxxx
Xxxxxxxx
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Name: Xxxxxxx
Xxxxxxxx
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Title:
Chairman, President and Chief Executive Officer
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Agreed to and accepted
as of the date first written above:
EARLYBIRDCAPITAL, INC., as Representative of the several
Underwriters
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By: /s/
Xxxxxx Xxxxxx
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Name: Xxxxxx
Xxxxxx
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Title:
CEO
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[Signature
Page to Underwriting Agreement, dated November 20,
2017]
SCHEDULE A
6,000,000 Units
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Underwriter
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Number of Firm Units
to be Purchased
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EarlyBirdCapital,
Inc.
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5,400,000
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I-Bankers
Securities, Inc.
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600,000
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TOTAL
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6,000,000
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SCHEDULE B
EXHIBIT A
Form of Target Business Letter
c/o Big
Rock Partners Sponsor, LLC
0000 X.
Xxxxxxx Xxxxxxx
Xxxxx
000
Xxxxxx
Xxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Final Prospectus
of Big Rock Partners Acquisition Corp. (the “Company”), dated November 20,
2017 (the
“Prospectus”). Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the
Prospectus.
We have read the Prospectus and understand
that the Company has
established the Trust Account, initially in an amount of at least
$60,000,000, for
the benefit of the Public Stockholders and that, except for the
interest earned on the amounts held in the Trust Account that may
be released to pay for the Company’s tax obligations,
the Company may disburse monies from
the Trust Account only: (i) to the Public Stockholders in
the event of the conversion or sale of their shares upon
consummation of a Business Combination or certain amendments to the
Company’s Amended and Restated Certificate of Incorporation
as described in the Prospectus, (ii) to the Public Stockholders in
connection with the Company’s liquidation in the event the Company is
unable to consummate a Business Combination within the required
time period or (iii) to the Company concurrently with, or after it
consummates a Business Combination.
For and in consideration of the Company
agreeing to evaluate the undersigned
for purposes of consummating a Business Combination with it, the
undersigned hereby agrees that it does not have any right, title,
interest or claim of any kind in or to any monies in the Trust
Account (each, a “Claim”) and hereby 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
Account for any reason whatsoever.
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Print Name of Target Business
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Authorized Signature of Target Business
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EXHIBIT B
Form of Vendor Letter
c/o Big
Rock Partners Sponsor, LLC
0000 X.
Xxxxxxx Xxxxxxx
Xxxxx
000
Xxxxxx
Xxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Final Prospectus
of Big Rock Partners Acquisition Corp. (the “Company”), dated November 20, 2017
(the “Prospectus”). Capitalized terms used and not otherwise
defined herein shall have the meanings assigned to them in the
Prospectus.
We have read the Prospectus and understand
that the Company has
established the Trust Account, initially in an amount of at least
$60,000,000, for
the benefit of the Public Stockholders and that, except for the
interest earned on the amounts held in the Trust Account that may
be released to pay for the Company’s tax obligations,
the Company may disburse monies from
the Trust Account only: (i) to the Public Stockholders in
the event of the conversion or sale of their shares upon
consummation of a Business Combination or certain amendments to the
Company’s Amended and Restated Certificate of
Incorporation as
described in the Prospectus, (ii) to the Public Stockholders in
connection with the Company’s liquidation in the event the Company is
unable to consummate a Business Combination within the required
time period or (iii) to the Company concurrently with, or after it
consummates a Business Combination.
For and in consideration of the Company
agreeing to use the services of the
undersigned, the undersigned hereby agrees that it does not have
any right, title, interest or claim of any kind in or to any monies
in the Trust Account (each, a “Claim”) and hereby waives any Claim it may have
in the future as a result of, or arising out of, any services
provided to the Company and
will not seek recourse against the Trust Account for any reason
whatsoever.
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Print Name of Vendor
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Authorized Signature of Vendor
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