May __, 2008
EXHIBIT
99.1
May
__,
2008
Xxx
Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxx,
Xxx Xxxxxx 00000
Citigroup
Global Markets Inc.
As
Representative of the Several Underwriters
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Gentlemen:
This
letter is being delivered to you in accordance with the Underwriting Agreement
(the “Underwriting
Agreement”)
entered into by and between Highlands Acquisition Corp., a Delaware corporation
(the “Company”),
and
Citigroup Global Markets Inc., as Representative (the “Representative”)
of the
several underwriters named in Schedule I thereto (the “Underwriters”),
relating to an underwritten initial public offering (the “IPO”)
of the
Company’s units (the “Units”),
each
comprised of one share of the Company’s common stock, par value $0.0001 per
share (the “Common
Stock”),
and
one warrant exercisable for one share of Common Stock (each, a “Warrant”).
Certain capitalized terms used herein are defined in Section 17
hereof.
In
recognition of the benefit that such IPO will confer upon the undersigned as
a
stockholder of the Company, and for other good and valuable consideration,
the
receipt and sufficiency of which are hereby acknowledged, the undersigned hereby
agrees with the Company as follows:
1. If
the
Company solicits approval of its stockholders of a Business Combination, the
undersigned will (i) vote all shares of Founder’s Common Stock included in the
Founder’s Units beneficially owned by him in accordance with the majority of the
votes cast by the holders of the IPO Shares and in favor of an amendment to
the
Company’s Amended and Restated Certificate of Incorporation to provide for the
Company’s perpetual existence and (ii) vote all other shares of the Company’s
Common Stock that may be acquired by him after the date hereof in favor of
such
Business Combination.
2. In
the
event that the Company fails to consummate a Business Combination within 24
months from October 3, 2007, which date is the effective date of the
registration statement relating to the IPO, the undersigned will, as promptly
as
possible, (i) cause the Trust Account to be liquidated and distributed to the
holders of IPO Shares and (ii) cause the Company to liquidate as soon as
reasonably practicable. The undersigned hereby waives any and all right, title,
interest or claim of any kind in or to any distribution of the Trust Account
and
any remaining net assets of the Company as a result of such liquidation with
respect to his shares of Founder’s Common Stock (“Claim”)
and
hereby waives any Claim the undersigned may have in the future as a result
of,
or arising out of, any contracts or agreements with the Company and will not
seek recourse against the Trust Account for any reason whatsoever; provided,
however, that in the event that the Company fails to consummate a Business
Combination and the Trust Account is liquidated and distributed, nothing herein
shall prevent the undersigned from participating in the Trust Account pro rata
with the Company’s public stockholders with respect to any shares of Common
Stock purchased by the undersigned after the date hereof.
3. The
undersigned understands that the Company may effect a Business Combination
with
any entity and agrees that, during the period commencing on the closing of
the
IPO and extending until the Company has entered into a letter of intent,
agreement in principle or definitive agreement regarding the Company’s initial
Business Combination, he will not participate in the formation of, or become
affiliated as an officer, director or stockholder of, any blank check company
with a focus on target businesses in the healthcare industry; provided, however,
that nothing contained herein shall override a person’s fiduciary obligations to
any entity with which he is currently, directly or indirectly, associated or
affiliated or by whom he is currently employed.
4. The
undersigned acknowledges and agrees that the Company will not consummate any
Business Combination which involves a company which is affiliated with any
of
the Insiders unless the Company obtains an opinion from an independent
investment banking firm reasonably acceptable to the Representative that the
business combination is fair to the Company’s stockholders from a financial
perspective.
5. Neither
the undersigned, any member of the family of the undersigned, nor any affiliate
of the undersigned will be entitled to receive and will not accept any
compensation for services rendered to the Company prior to or in connection
with
the consummation of the Business Combination; provided, however, that the
undersigned shall be entitled to reimbursement from the Company for his
out-of-pocket expenses incurred in connection with seeking and consummating
a
Business Combination.
6. Neither
the undersigned, any member of the family of the undersigned, nor any affiliate
of the undersigned will be entitled to receive or accept a finder’s fee or any
other compensation in the event the undersigned, any member of the family of
the
undersigned or any affiliate of the undersigned originates a Business
Combination.
7. Subject
to the terms and conditions hereof and in reliance upon the covenants,
representations and warranties of the undersigned contained herein, on the
date
hereof the undersigned shall pay to the Company $150 (the “Purchase
Price”)
in
consideration of the sale and delivery of 20,700 units (the “Founder’s
Units”)
of the
Company, with each Founder’s Unit consisting of one share of Common Stock (the
“Founder’s
Common Stock”)
and
one warrant to purchase one share of Common Stock (the “Founder’s
Warrant”).
Each
Founder’s Warrant will have an exercise price of $7.50 per share and will become
exercisable on the later of the completion of the Company’s initial business
combination or January 3, 2009 if and when the last sales price of the Company’s
common stock exceeds $14.25 per share for any 20 trading days within a
30-trading day period beginning 90 days after the Company’s initial business
combination. The undersigned acknowledges and agrees that the Founder’s Units
(including the underlying securities) have not been registered under the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(the “Act”),
or
any state securities laws, and the certificates representing the Founder’s
Units, Founder’s Common Stock and Founder’s Warrants will bear a legend to such
effect.
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The
undersigned acknowledges and agrees that the Founder’s Units purchased hereby
will be subject to certain restrictions on transfer, voting and forfeiture
provisions as set forth in this letter agreement. In the event that the
undersigned resigns and terminates his service as a director of the Company
prior to the expiration of the time periods set forth in paragraphs 8 and 9
of
this letter agreement, the undersigned acknowledges and agrees that the
Founder’s Units, Founder’s Common Stock and Founder’s Warrants, as the case may
be, purchased hereby shall be forfeited by the undersigned and sold,
transferred, conveyed, assigned and delivered to the Company for cancellation.
The undersigned acknowledges and agrees that the certificates representing
the
Founder’s Units, Founder’s Common Stock and Founder’s Warrants will bear a
legend to the effect that such securities are subject to
forfeiture.
8. The
undersigned agrees to escrow all of his Founder’s Common Stock until one year
after the consummation by the Company of a Business Combination (“Common
Stock Escrow Period”)
and
all of his Founder’s Warrants until the last sales price of the Common Stock
exceeds $14.25 per share (subject to adjustment in the event of stock dividends,
splits and similar actions) for any 20 trading days within a 30-trading day
period beginning 90 days after the consummation of a Business Combination
(“Warrant
Escrow Period”,
and
collectively with the Common Stock Escrow Period, the “Escrow
Periods”).
Provided that the undersigned has not then resigned or refused to stand for
reelection as a director, the risk of forfeiture of the Founder’s Common Stock
shall lapse on the last day of the Common Stock Escrow Period and the risk
of
forfeiture of the Founder’s Warrants shall lapse on the last day of the Warrant
Escrow Period, and each such security shall be released from escrow in
accordance with and subject to the terms and conditions of the Escrow Agreement,
dated as of October 3, 2007 (the “Escrow
Agreement”),
by
and among the Company, the Insiders and Continental Stock Transfer & Trust
Company annexed to the letter from the Company addressed to the undersigned,
dated May 8, 2008, as Exhibit C. In addition, pursuant to the Escrow Agreement,
in the event that the Company notifies the escrow agent that the Company is
being liquidated at any time during the Escrow Period, then the escrow agent
shall promptly destroy the certificates representing the escrowed Founder’s
Units, Founder’s Common Stock and Founder’s Warrants. The undersigned
acknowledges that he has read the Escrow Agreement and hereby agrees to be
bound
by the terms and provisions of the Escrow Agreement as if the undersigned were
an original party thereto and defined as a “Founder” therein. The undersigned
agrees to execute such additional documentation as may be reasonably requested
by the escrow agent to effectuate the terms and agreements herein and
therein.
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9. The
undersigned agrees to serve as a Director of the Company until the earlier
of
(x) the expiration of the respective Escrow Periods, (y) the liquidation of
the
Company, or (z) the expiration of his term, if the board of directors of the
Company fails to renominate him for election or the stockholders of the Company
fail to re-elect him as a director; provided that nothing herein shall be
construed as providing a right of the undersigned to any position if removed
by
proper corporate action. The undersigned’s biographical information furnished to
the Company and the Representative and attached hereto as Exhibit
A
is true
and accurate in all respects, does not omit any material information with
respect to the undersigned’s background and contains all of the information
required to be disclosed pursuant to Item 401 of Regulation S-K, promulgated
under the Securities Act of 1933. The undersigned’s Director and Officer
Questionnaire furnished to the Company and the Representative and annexed as
Exhibit
B
hereto
are true and accurate in all respects. The undersigned represents and warrants
that:
(a) he
is not
subject to, or a respondent in, any legal action for, any injunction,
cease-and-desist order or order or stipulation to desist or refrain from any
act
or practice relating to the offering of securities in any
jurisdiction;
(b) he
has
never been convicted of or pleaded guilty to any crime (i) involving any fraud
or (ii) relating to any financial transaction or handling of funds of another
person, or (iii) pertaining to any dealings in any securities and he is not
currently a defendant in any such criminal proceeding; and
(c) he
has
never been suspended or expelled from membership in any securities or
commodities exchange or association or had a securities or commodities license
or registration denied, suspended or revoked.
10. The
undersigned has full right and power, without violating any agreement by which
he is bound to enter into this letter agreement and to serve as a director
of
the Company and hereby consents to being named in filings by the Company with
the Securities and Exchange Commission as such.
11. The
undersigned hereby waives his right to exercise conversion rights with respect
to any shares of the Company’s Common Stock owned or to be owned by the
undersigned, directly or indirectly, and agrees that he will not seek conversion
with respect to such shares in connection with any vote to approve a Business
Combination.
12. The
undersigned hereby agrees to not propose, or vote in favor of, an amendment
to
the Company’s Amended and Restated Certificate of Incorporation to extend the
period of time in which the Company must consummate a Business Combination
prior
to its liquidation. Should such a proposal be put before stockholders, the
undersigned hereby agrees to vote against such proposal except in connection
with a Business Combination to give the Company perpetual existence. This
paragraph may not be modified or amended under any circumstances.
13. [Intentionally
Omitted]
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14. This
letter agreement shall be governed by and construed and enforced in accordance
with the laws of the State of New York, without giving effect to conflicts
of
law principles that would result in the application of the substantive laws
of
another jurisdiction. The undersigned hereby (i) agrees that any action,
proceeding or claim arising out of or relating in any way to this letter
agreement (a “Proceeding”)
shall
be brought and enforced in the courts of the State of New York or the Federal
courts of the United States of America for the Southern District of New York,
and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive and (ii) waives any objection to such exclusive jurisdiction and
that
such courts represent an inconvenient forum.
15. Nothing
contained herein shall be deemed to render the Underwriters a representative
of,
or a fiduciary with respect to, the Company, its stockholders or any creditor
or
vendor of the Company with respect to the subject matter hereof.
16. This
letter agreement shall be binding on the undersigned and such person’s
respective successors, heirs, personal representatives and assigns. This letter
agreement shall terminate on the earlier of (i) the expiration of the longest
applicable lock-up period and (ii) the liquidation of the Company; provided,
that such termination shall not relieve the undersigned from liability for
any
breach of this agreement prior to its termination.
17. As
used
herein, (i) a “Business
Combination”
shall
mean a merger, capital stock exchange, asset acquisition or other similar
business combination with an operating business; (ii) “Insiders”
shall
mean all officers, directors and stockholders of the Company immediately prior
to the IPO; (iii) “Founder’s
Common Stock”
shall
mean all of the shares of Common Stock of the Company included in the Founder’s
Units acquired by the undersigned pursuant to paragraph 7 of this letter
agreement; (iv) “Founder’s
Units”
shall
mean all of the units acquired by the undersigned pursuant to paragraph 7 of
this letter agreement; (v) “Founder’s
Warrants”
shall
mean all of the warrants of the Company included in the Founder’s Units acquired
by the undersigned pursuant to paragraph 7 of this letter agreement; (vi)
“IPO
Shares”
shall
mean the shares of Common Stock issued in the Company’s IPO; and (vii)
“Trust
Account”
shall
mean the Trust Account into which a portion of the net proceeds of the Company’s
IPO will be deposited.
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18. The
undersigned authorizes any employer, financial institution or consumer credit
reporting agency to release to the Representative and its legal representatives
or agents (including any investigative search firm retained by the
Representative) any information they may have about the undersigned’s background
and finances (“Information”),
purely for the purposes of the Company’s IPO (and shall thereafter hold such
Information confidential). Neither the Representative nor its agents shall
be
violating the undersigned’s right of privacy in any manner in requesting and
obtaining the Information and the undersigned hereby releases them from
liability for any damage whatsoever in that connection.
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Xxxxxx
X. Xxxxxx
Print
Name of Insider
________________________
Signature
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6
EXHIBIT A
Biography
7
EXHIBIT
B
Director
and Officer Questionnaire
8
