20,000,000 Units Atlas Acquisition Holdings Corp. UNDERWRITING AGREEMENT
Exhibit 1.1
20,000,000 Units
January 24, 2008
Lazard Capital Markets LLC
Xxxxxx Xxxxxxx & Co. Incorporated
As Representatives of the
Several Underwriters
Xxxxxx Xxxxxxx & Co. Incorporated
As Representatives of the
Several Underwriters
c/o Lazard Capital Markets LLC
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Atlas Acquisition Holdings Corp., a Delaware corporation (the “Company”), proposes to
sell to the several underwriters (the “Underwriters”) named in Schedule I hereto for whom
you are acting as representatives (the “Representatives”) an aggregate of 20,000,000 units
(the “Firm Units”), with each unit consisting of one share of the Company’s common stock,
$0.001 par value (the “Common Stock”) and one warrant (“Warrant”) to purchase one
share of Common Stock. The respective amounts of Firm Units to be so purchased by each of the
several Underwriters are set forth opposite their respective names in Schedule I hereto. The
Company also proposes to sell, at the Underwriters’ option (“Over-allotment Option”), an
aggregate of up to 3,000,000 additional units of the Company (the “Option Units”) as set
forth below. The terms of the Warrants are provided for in the form of a Warrant Agreement (as
defined herein).
As the Representatives, you have advised the Company (a) that you are authorized to enter into
this Agreement on behalf of the several Underwriters, and (b) that the several Underwriters are
willing, acting severally and not jointly, to purchase the numbers of Firm Units set forth opposite
their respective names in Schedule I, plus their pro rata portion of the Option Units if you elect
to exercise the Over-allotment Option in whole or in part for the accounts of the several
Underwriters. The Firm Units and the Option Units (to the extent the aforementioned option is
exercised) are hereinafter collectively referred to as the “Units”, and the Units, the
shares of Common Stock and the Warrants included in the Units and the shares of Common
Stock issuable upon exercise of the Warrants included in the Units are hereinafter referred to
as the “Securities.”
Xxxxxx Xxxxxxx & Co. Incorporated (“Xxxxxx Xxxxxxx”) has agreed to reserve up to 5
percent of the Units to be purchased by it under this Agreement for sale to the Company’s
directors, officers, employees and business associates and other parties related to the Company
(collectively, “Participants”), as set forth in the Prospectus (as defined below) under the
heading “Underwriting” (the “Directed Unit Program”). The Units to be sold by Xxxxxx
Xxxxxxx and its affiliates pursuant to the Directed Unit Program are referred to hereinafter as the
“Directed Units.” Any Directed Units not orally confirmed for purchase by any Participants by the
end of the business day on which this Agreement is executed will be offered to the public by the
Underwriters as set forth in the Prospectus.
In consideration of the mutual agreements contained herein and of the interests of the parties
in the transactions contemplated hereby, the parties hereto agree as follows:
1. Representations and Warranties of the Company.
The Company represents and warrants to each of the Underwriters as follows:
(a) A registration statement on Form S-1 (File No. 333-146368) with respect to the Units, the
shares of Common Stock included in the Units, and the Warrants has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended (the “Act”), and
the rules and regulations (the “Rules and Regulations”) of the Securities and Exchange
Commission (the “Commission”) thereunder and has been filed with the Commission. Copies of
such registration statement, including any amendments thereto, the preliminary prospectuses
(meeting the requirements of the Rules and Regulations) contained therein and the exhibits,
financial statements and schedules, as finally amended and revised, have heretofore been delivered
by the Company to you. Such registration statement originally filed with the Commission on
September 28, 2007, as amended by any amendments thereto and together with any registration
statement filed by the Company pursuant to Rule 462(b) under the Act, is herein referred to as the
“Registration Statement,” which shall be deemed to include all information omitted
therefrom in reliance upon Rules 430A or 430C under the Act and contained in the Prospectus
referred to below, has become effective under the Act and no post-effective amendment to the
Registration Statement has been filed as of the date of this Agreement (the “Effective
Date”). “Prospectus” means the form of prospectus filed with the Commission pursuant
to and within the time limits described in Rule 424(b) under the Act. The preliminary prospectus
included in the Registration Statement as of the Applicable Time (as defined below) is herein
referred to as the “Preliminary Prospectus.” Any reference herein to the Prospectus shall
be deemed to include any supplements or amendments thereto filed with the Commission after the date
of filing of the Prospectus under Rule 424(b) under the Act, and prior to the termination of the
offering of the Units by the Underwriters. The Company has filed with the Commission a Form 8-A
(File Number 001-33927) providing for the registration under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), of the Securities.
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(b) As of the Applicable Time and as of the Closing Date or the Option Closing Date, as the
case may be, the Preliminary Prospectus and the information included on Schedule II hereto, all
considered together (collectively, the “General Disclosure Package”) did not and will not
include any untrue statement of a material fact and did not and will not 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; provided, however, that the Company makes no representations
or warranties as to information contained in or omitted from the General Disclosure Package in
reliance upon, and in conformity with, written information furnished to the Company by or on behalf
of any Underwriter through the Representatives specifically for use therein, it being understood
and agreed that the only such information is that described in Section 12 herein. The Company has
not prepared or used and will not prepare or use a “free writing prospectus” as defined in Rule 405
under the Act, in connection with the offering of Securities. As used in this subsection and
elsewhere in this Agreement, “Applicable Time” means 5:00 p.m. (New York time) on the date
of this Agreement or such other time as agreed to by the Company and the Representatives.
(c) The Company has been duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with corporate power and authority to own or
lease its properties and conduct its business as described in the Registration Statement, the
General Disclosure Package and the Prospectus. The Company has no subsidiaries, direct or
indirect. The Company is duly qualified to transact business and in good standing in all
jurisdictions in which the conduct of its business requires such qualification except for any
jurisdiction where the failure to be so qualified would not be reasonably expected to have a
Material Adverse Effect (as defined below).
(d) The outstanding shares of Common Stock have been duly authorized and validly issued and
are fully paid and non-assessable. The shares of Common Stock included in the Units have been duly
authorized and, when issued and paid for as contemplated herein, will be validly issued, fully paid
and non-assessable; and no preemptive rights of stockholders exist with respect to any of such
shares or the issue and sale thereof. The shares of Common Stock issuable upon exercise of the
Warrants have been duly authorized and, when issued and paid for as contemplated in the Warrants
and the Warrant Agreement, will be validly issued, fully paid and non-assessable; and no preemptive
rights of stockholders exist with respect to any of such shares or the issue and sale thereof.
(e) The Warrants included in the Units have been duly authorized and, when executed by the
Company, countersigned in the manner provided for in the Warrant Agreement and delivered and paid
for as contemplated herein, will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as enforcement thereof may
be limited by bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement of
creditors’ rights generally and except as enforcement thereof is subject to equitable principles of
general applicability (regardless of whether enforcement is considered in a proceeding in equity or
at law).
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(f) Neither the filing of the Registration Statement nor the offering or sale of the Units as
contemplated by this Agreement gives rise to any rights, other than those which have been waived or
satisfied, for or relating to the registration of any securities of the Company except for those
rights provided for in the Registration Rights Agreement, dated as of the date hereof, by and among
the Company and the Initial Stockholders (defined below). Except as set forth in the Registration
Statement, the General Disclosure Package and the Prospectus, and except for those rights provided
for in the Registration Rights Agreement, dated as of the date hereof, by and among the Company and
certain stockholders of the Company, 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.
(g) The information set forth under the caption “Capitalization” in the Registration Statement
and the Prospectus (and any similar section or information contained in the General Disclosure
Package) is true and correct. All of the Securities conform in all material respects to the
descriptions thereof contained in the Registration Statement, the General Disclosure Package and
the Prospectus. The form of the certificates for the shares of Common Stock complies with the
General Corporation Law of the State of Delaware.
(h) Neither the Commission nor any state regulatory authority has issued an order preventing
or suspending the use of the Preliminary Prospectus or the Prospectus relating to the proposed
offering of the Units, and no proceeding for that purpose or pursuant to Section 8A of the Act has
been instituted or, to the Company’s knowledge, threatened by the Commission or any state
regulatory authority. Neither the Commission nor any state regulatory authority has issued any
order preventing or suspending the effectiveness of the Registration Statement and no proceeding
for that purpose or pursuant to Section 8A of the Act has been instituted or is pending or, to the
Company’s knowledge, is contemplated or threatened by the Commission. The Registration Statement
complies as to form to, and the Prospectus and any amendments or supplements thereto will comply as
to form to, the requirements of the Act and the Rules and Regulations. The Registration Statement
and any amendment thereto do not contain, and will not contain, any untrue statement of a material
fact and do not omit, and will not omit, to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. The Prospectus and any amendments and
supplements thereto do not contain, and will not contain, any untrue statement of a material fact;
and do not omit, and will not 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;
provided, however, that the Company makes no representations or warranties as to information
contained in or omitted from the Registration Statement or the Prospectus, or any such amendment or
supplement, in reliance upon, and in conformity with, written information furnished to the Company
by or on behalf of any Underwriter through the Representatives specifically for use therein, it
being understood and agreed that the only such information is that described in Section 12 herein.
(i) The Company has not, directly or indirectly, distributed and will not distribute any
offering material in connection with the offering and sale of the Units other than the Preliminary
Prospectus, the Prospectus and other materials, if any, permitted under the Act.
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(j) The financial statements of the Company, together with related notes and schedules as set
forth in the Registration Statement, the General Disclosure Package and the Prospectus, present
fairly the financial position and the results of operations and cash flows of the Company, at the
indicated dates and for the indicated periods. Such financial statements and related schedules
comply with the applicable accounting requirements of the Act and the Rules and Regulations and
have been prepared in accordance with generally accepted accounting principles in the United States
(“GAAP”), consistently applied throughout the periods involved, except as disclosed
therein, and all adjustments necessary for a fair presentation of results for such periods have
been made. The summary financial data included in the Registration Statement, the General
Disclosure Package and the Prospectus present fairly the information shown therein and such data
has been compiled on a basis consistent with the financial statements presented therein and the
books and records of the Company. The Company does not have any material liabilities or
obligations, direct or contingent (including any off-balance sheet obligations or any “variable
interest entities” within the meaning of Financial Accounting Standards Board Interpretation No.
46), not disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus. There are no financial statements (historical or pro forma) that are required to be
included in the Registration Statement, the General Disclosure Package or the Prospectus that are
not included as required.
(k) Xxxxxxxxx, Kass & Company, P.C., who have certified certain financial statements that are
filed with the Commission as part of the Registration Statement, the General Disclosure Package and
the Prospectus, is an independent registered public accounting firm with respect to the Company
within the meaning of the Act and the applicable Rules and Regulations and the Public Company
Accounting Oversight Board (United States) (the “PCAOB”).
(l) Except as disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, the Company is not aware of any (i) material weakness in its internal control over
financial reporting or (ii) change in internal control over financial reporting that has materially
affected, or is reasonably likely to materially affect, the Company’s internal control over
financial reporting.
(m) Solely to the extent that the Xxxxxxxx-Xxxxx Act of 2002, as amended, and the rules and
regulations promulgated by the Commission and the American Stock Exchange thereunder (the
“Xxxxxxxx-Xxxxx Act”) has been applicable to the Company, there is and has been no failure
on the part of the Company to comply in all material respects with any provision of the
Xxxxxxxx-Xxxxx Act. The Company has taken all necessary actions to ensure that it is in compliance
with all provisions of the Xxxxxxxx-Xxxxx Act that are in effect and with which the Company is
required to comply and is actively taking steps to ensure that it will be in compliance with other
provisions of the Xxxxxxxx-Xxxxx Act which have been proposed which are not currently in effect or
which will become applicable to the Company.
(n) There is no action, suit, claim or proceeding pending or, to the knowledge of the Company,
threatened against the Company or, to the knowledge of the Company, pending or threatened against
any of the Company’s stockholders immediately prior to the offering of Units (the “Initial
Stockholders”) or special advisors, before any court or administrative agency or otherwise
which if determined adversely to the Company would either (i) have, individually
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or in the aggregate, a material adverse effect on the earnings, business, management,
properties, assets, rights, operations, condition (financial or otherwise) or prospects of the
Company or (ii) prevent the consummation of the transactions contemplated hereby (the occurrence of
any such effect or any such prevention described in the foregoing clauses (i) and (ii) being
referred to as a “Material Adverse Effect”), except as set forth in the Registration
Statement, the General Disclosure Package and the Prospectus.
(o) All leases of the Company described in the Registration Statement, the General Disclosure
Package and the Prospectus are valid and subsisting and in full force and effect.
(p) Since the respective dates as of which information is given in the Registration Statement,
the General Disclosure Package and the Prospectus, as each may be amended or supplemented, there
has not been any event or development in respect of the business or condition of the Company that,
individually or in the aggregate, would have a Material Adverse Effect, whether or not occurring in
the ordinary course of business, and there has not been any material transaction entered into or
any material transaction that is probable of being entered into by the Company, other than
transactions in the ordinary course of business and changes and transactions described in the
Registration Statement, the General Disclosure Package and the Prospectus, as each may be amended
or supplemented, and no member of the Company’s management or board of directors has resigned from
any position with the Company. The Company has no material contingent obligations which are not
disclosed in the Company’s financial statements which are included in the Registration Statement,
the General Disclosure Package and the Prospectus.
Subsequent to the respective dates as of which information is given in the Registration
Statement, the General Disclosure Package and the Prospectus, except as otherwise specifically
stated therein or in this Agreement, 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 of its capital stock.
(q) The Company is not, nor with the giving of notice or lapse of time or both, will be, (i)
in violation of its amended and restated certificate of incorporation or bylaws, (ii) in violation
of or in default under any agreement, lease, contract, indenture or other instrument or obligation
to which it is a party or by which it, or any of its properties, is bound or (iii) in violation of
any law, order, rule or regulation, judgment, order, writ or decree applicable to the Company of
any court or of any government, regulatory body or administrative agency or other governmental body
having jurisdiction over the Company, its properties or assets. The execution, delivery and
performance of this Agreement, the Warrant Agreement, the Escrow Agreement and the Trust Agreement
(each as defined below), and the consummation of the transactions herein and therein contemplated
and the fulfillment of the terms hereof and thereof will not conflict with or result in a breach of
any of the terms or provisions of, or constitute a default under, (i) the amended and restated
certificate of incorporation or bylaws of the Company, (ii) any indenture, mortgage, deed of trust
or other agreement or instrument to which the Company is a party or by which the Company or any of
its properties is bound, or (iii) any law, order, rule or regulation, judgment, order, writ or
decree applicable to the Company of any
6
court or of any government, regulatory body or administrative agency or other governmental
body having jurisdiction over the Company, its properties or assets.
(r) The execution and delivery of, and the performance by the Company of its obligations
under, this Agreement, the Warrant Agreement, the Escrow Agreement and the Trust Agreement have
been duly and validly authorized by all necessary corporate action on the part of the Company, and
this Agreement has been duly executed and delivered by the Company. On the Closing Date, the
Warrant Agreement, the Escrow Agreement and the Trust Agreement will have been duly executed and
delivered by the Company and they will constitute the valid and binding agreements of the Company,
enforceable against the Company in accordance with their respective terms, except (i) as such
enforceability may be limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar laws affecting enforcement
of creditors’ rights generally; (ii) as such enforceability is subject to equitable principles of
general applicability (regardless of whether enforcement is considered in a proceeding in equity or
at law); and (iii) as enforceability of any indemnification and contribution provisions may be
limited under state or federal securities laws.
(s) Each approval, consent, order, authorization, designation, declaration or filing by or
with any regulatory, administrative or other governmental body necessary in connection with the
execution and delivery by the Company of this Agreement, the Warrant Agreement, the Escrow
Agreement and the Trust Agreement, and the consummation of the transactions herein and therein
contemplated (except for such additional steps as may be required by the Commission, or the
Financial Industry Regulatory Authority, Inc. (“FINRA”) or such additional steps as may be
necessary to qualify the Units for public offering by the Underwriters under state securities or
Blue Sky laws) has been obtained or made and is in full force and effect.
(t) The Company holds all material licenses, certificates and permits from governmental
authorities which are necessary to the conduct of its business.
(u) Neither the Company, nor to the Company’s knowledge, any of its affiliates, has taken or
will take, directly or indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to constitute, the stabilization or manipulation
of the price of the Units to facilitate the sale or resale of the Units in connection with the
offering contemplated hereby.
(v) The Company is not and, after giving effect to the offering and sale of the Units
contemplated hereunder and the application of the net proceeds from such sale as described in the
Registration Statement, the General Disclosure Package and the Prospectus, will not be an
“investment company” within the meaning of such term under the Investment Company Act of 1940, as
amended (the “1940 Act”), and the rules and regulations of the Commission thereunder.
(w) The Company maintains 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 to permit preparation of
financial statements in conformity with GAAP and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with
7
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.
(x) The operations of the Company are and have been conducted at all times in compliance with
applicable financial record-keeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable
rules and regulations thereunder (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
Company’s knowledge, threatened.
(y) Neither the Company nor, to the Company’s knowledge, any director, officer, agent,
employee or affiliate of the Company, is currently subject to any U.S. sanctions administered by
the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the
Company will not directly or indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently subject to any U.S.
sanctions administered by OFAC.
(z) The Company is in compliance in all material respects with all presently applicable
provisions of the Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder (“ERISA”); no “reportable event” (as
defined in ERISA) has occurred with respect to any “pension plan” (as defined in ERISA) for which
the Company would have any liability; the Company has not incurred and does not expect to incur
liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any
“pension plan” or (ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the “Code”); and each
“pension plan” for which the Company would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which would cause the loss of such qualification.
(aa) Except as disclosed in the Registration Statement, the General Disclosure Package, and
the Prospectus, to the Company’s knowledge, there are no affiliations or associations between any
member of FINRA and any of the Company’s officers, directors or 5% or greater securityholders or
special advisors (prior to the sale of Units contemplated by this Agreement).
(bb) The Units, the Warrants and the Common Stock have been approved for listing subject to
notice of issuance on the American Stock Exchange.
(cc) There are no relationships or related-party transactions involving the Company or any
other person required to be described in the Registration Statement, the General Disclosure Package
and the Prospectus which have not been described as required.
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(dd) Neither the Company nor any of the Initial Stockholders nor any other person in each case
acting on behalf of the Company (other than the Underwriters) has made any contribution or other
payment to any official of, or candidate for, any federal, state or foreign office in violation of
any law which violation is required to be disclosed in the Registration Statement, the General
Disclosure Package and the Prospectus.
(ee) No consent, approval, authorization or order of, or qualification with, any governmental
body or agency, other than those obtained, is required in connection with the offering of the
Directed Units in any jurisdiction where the Directed Units are being offered.
(ff) The Company has not offered, or caused Xxxxxx Xxxxxxx or its affiliates to offer, Units
to any person pursuant to the Directed Unit Program with the specific intent to unlawfully
influence (i) a customer or supplier of the Company to alter the customer’s or supplier’s level or
type of business with the Company, or (ii) a trade journalist or publication to write or publish
favorable information about the Company or its products.
(gg) All information contained in the director’s and officer’s questionnaires completed by
each of the Company’s Initial Stockholders, directors, officers and special advisors and provided
to the Representatives is true and correct in all respects and the Company has not become aware of
any information which would cause the information disclosed in the questionnaires completed by each
such Initial Stockholder, officer, director and special advisor to become inaccurate and incorrect
in any respect.
(hh) 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 Initial Stockholder with
respect to the sale of the Units hereunder or any other arrangements, agreements or understandings
of the Company or, to the Company’s knowledge, any Initial Stockholder, that may reasonably be
expected to affect the Underwriters’ compensation, as determined by FINRA. 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)
any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation or
association with any FINRA member, within the twelve months prior to the Effective Date. None of
the net proceeds of the offering will be paid by the Company to any participating FINRA member or
its affiliates, except as specifically authorized herein and except as may be paid in connection
with an initial merger, capital stock exchange, asset acquisition or other similar business
combination with an operating business (“Business Combination”) and/or one or more other
transactions after the Business Combination, including without limitation in connection with the
payment of investment banking fees, fees in connection with fairness opinions and other similar
fees or expenses.
(ii) The Company has entered into a warrant agreement with respect to the Warrants with
American Stock Transfer & Trust Company, which agreement is substantially in the form of Exhibit
4.4 to the Registration Statement (the “Warrant Agreement”). The Company has entered into
an Investment Management Trust Agreement (the “Trust Agreement”) with respect to certain
proceeds of the offering, which agreement is substantially in the form of
9
Exhibit 10.2 to the Registration Statement. The Company has entered into a stock escrow
agreement with respect to the shares of Common Stock held by the Initial Stockholders with American
Stock Transfer & Trust Company and the Initial Stockholders, which agreement is substantially in
the form of Exhibit 10.3 to the Registration Statement (the “Stock Escrow Agreement”).
(jj) The Company has caused to be duly executed legally binding and enforceable agreements
(except (i) as enforcement thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors’ rights generally; (ii) as enforcement thereof is subject to
equitable principles of general applicability (regardless of whether enforcement is considered in a
proceeding in equity or at law); and (iii) as enforceability of any indemnification and
contribution provisions may be limited under state or federal securities laws) in the form filed as
Exhibit 10.1 to the Registration Statement (the “Insider Letters”), pursuant to which each
of the Initial Stockholders of the Company has agreed to certain matters including, but not limited
to, certain matters described as being agreed to by such Initial Stockholder under the “Proposed
Business” section of the Registration Statement, the General Disclosure Package and the Prospectus.
(kk) Except as disclosed in the Registration Statement, the General Disclosure Package and the
Prospectus, no Initial Stockholder, employee, officer, director or special advisor of the Company
is subject to any non-competition or non-solicitation agreement with any employer or prior employer
which could reasonably be expected to materially affect his ability to be an employee, officer,
director or special advisor of the Company.
(ll) Upon delivery and payment for the Firm Units on the Closing Date and the filing of the
Closing 8-K (as defined below) promptly thereafter, the Company will not be subject to Rule 419
under the Act and none of the Company’s outstanding securities will be deemed to be a “xxxxx stock”
as defined in Rule 3a-51-1 under the Exchange Act.
(mm) The Company does not have any specific Business Combination under consideration or
contemplation and the Company has not, nor has anyone on its behalf, either directly or indirectly,
contacted any potential target business or their representatives or had any discussions, formal or
otherwise, with any of the foregoing with respect to effecting a business combination with the
Company. The Company has not engaged or retained any agent or other representative to identify or
locate any suitable target.
(nn) The Company has not provided investors with any material information (including oral
information other than oral information that is contained in Schedule II hereto) in connection with
the offering of securities, other than information that is contained in the Preliminary Prospectus,
Registration Statement, the Prospectus, any amendment or supplement thereto or document
incorporated by reference therein, or any “road show” (as defined in Rule 433 under the Securities
Act) for the offering.
2. Purchase, Sale and Delivery of the Firm Units.
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(a) On the basis of the representations, warranties and covenants herein contained, and
subject to the conditions herein set forth, the Company agrees to sell to the Underwriters and each
Underwriter agrees, severally and not jointly, to purchase, at a price of $9.74775 per Unit (the
“Initial Purchase Price”) (less $0.44775 per Unit purchased hereunder (the “Deferred
Discount”) payable to the Underwriters upon consummation of a Business Combination, subject to
Section 4(hh) hereof), the number of Firm Units set forth opposite the name of each Underwriter in
Schedule I hereof, subject to any adjustments as may be made in accordance with Section 13 hereof.
(b) Payment for the Firm Units to be sold hereunder is to be made in Federal (same day) funds
against delivery of certificates therefor to the Representatives for the several accounts of the
Underwriters. Such payment and delivery are to be made through the facilities of The Depository
Trust Company (“DTC”), New York, New York at 10:00 a.m., New York time, on the third
business day after the date of this Agreement (or the fourth business day following the date of
this Agreement, if the offering is priced after 4:30 p.m., New York time) or at such other time and
date not later than five business days thereafter as you and the Company shall agree upon, such
time and date being herein referred to as the “Closing Date.” (As used herein, “business
day” means a day on which the American Stock Exchange is open for trading and on which banks in New
York are open for business and are not permitted by law or executive order to be closed.) Payment
of $194,955,000, representing the aggregate purchase price for the Firm Units based on the Initial
Purchase Price, shall be made on the Closing Date by wire transfer in Federal (same day) funds, as
follows: $194,200,000 (including $8,955,000, representing the aggregate Deferred Discount without
giving effect to the Over-allotment Option) shall be deposited by the Representatives directly in
the trust account established by the Company for the benefit of the public securityholders as
described in the Registration Statement (the “Trust Account”) pursuant to the terms of the
Trust Agreement, and the remaining $755,000 of the proceeds (representing $150,000 of the proceeds
not required to be held in the Trust Account and $605,000 of offering expenses), shall be paid to
the Company, upon delivery to you of certificates (in form and substance satisfactory to the
Representatives) representing the Firm Units (or through the facilities of DTC) for the account of
the Underwriters. The certificates for the Firm Units will be delivered in such denominations and
in such registrations as the Representatives request in writing not later than the second full
business day prior to the Closing Date, and will be made available for inspection by the
Representatives at least one business day prior to the Closing Date.
(c) In addition, on the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company hereby grants to the several
Underwriters the Over-allotment Option to purchase the Option Units at the same price per Unit as
is set forth in the first paragraph of this Section 2 with respect to the Firm Units. The
Over-allotment Option granted hereby may be exercised in whole or in part by giving written notice
at any time within 45 days after the date of this Agreement, by you, as Representatives of the
several Underwriters, to the Company which notice shall set forth the number of Option Units as to
which the several Underwriters are exercising the option and the time and date at which such
certificates are to be delivered. The time and date at which certificates for Option Units are to
be delivered shall be determined by the Representatives but shall not be earlier than three nor
later than 10 full business days after the exercise of such
11
option, nor in any event prior to the Closing Date (such time and date being herein referred
to as the “Option Closing Date”). If the date of exercise of the option is three or more
days before the Closing Date, the notice of exercise shall set the Closing Date as the Option
Closing Date. The number of Option Units to be purchased by each Underwriter shall be in the same
proportion to the total number of Option Units being purchased as the number of Firm Units being
purchased by such Underwriter bears to the total number of Firm Units, adjusted by you in such
manner as to avoid fractional Units. The Over-allotment Option granted hereunder may be exercised
only to cover over-allotments in the sale of the Firm Units by the Underwriters. You, as
Representatives of the several Underwriters, may cancel such option at any time prior to its
expiration by giving written notice of such cancellation to the Company. To the extent, if any,
that the Over-allotment Option is exercised, payment for the Option Units shall be made on the
Option Closing Date in Federal (same day funds) through the facilities of DTC in New York, New York
drawn to the order of the Company. Payment for the Option Units shall be made on the Option
Closing Date by wire transfer in Federal (same day) funds, as follows: $9.74775 per Option Unit
sold (including the Deferred Discount) shall be deposited in the Trust Account pursuant to the
Trust Agreement upon delivery to you of certificates (in form and substance satisfactory to the
Representatives) representing the Option Units sold (or through the facilities of DTC) for the
account of the Underwriters.
3. Offering by the Underwriters.
It is understood that the several Underwriters are to make a public offering of the Firm Units
as soon as the Representatives deem it advisable to do so. The Firm Units are to be initially
offered to the public at the initial public offering price set forth in the Prospectus. The
Representatives may from time to time thereafter change the public offering price and other selling
terms. It is further understood that you will act as the Representatives for the Underwriters in
the offering and sale of the Units in accordance with a Master Agreement Among Underwriters entered
into by you and the several other Underwriters.
4. Covenants of the Company.
The Company covenants and agrees with the several Underwriters, and solely with respect to
Section 4(b), the Underwriters covenant and agree with the Company, that:
(a) The Company will (i) prepare and timely file with the Commission under Rule 424(b) of the
Rules and Regulations a Prospectus in a form approved by the Representatives containing information
previously omitted at the time of effectiveness of the Registration Statement in reliance on Rules
430A or 430C of the Rules and Regulations and (ii) not file any amendment to the Registration
Statement or distribute an amendment or supplement to the General Disclosure Package or the
Prospectus of which the Representatives shall not previously have been advised and furnished with a
copy or to which the Representatives shall have reasonably objected in writing or which is not in
compliance with the Rules and Regulations.
(b) The Company and each of the Underwriters will not make any offer relating to the
Securities that would constitute a “free writing prospectus” (as defined in Rule
12
405 under the Act) required to be filed by the Company with the Commission under Rule 433
under the Act.
(c) The Company will advise the Representatives promptly (i) when the Registration Statement
or any post-effective amendment thereto shall have become effective, (ii) of receipt of any
comments from the Commission, (iii) of any request of the Commission for amendment of the
Registration Statement or for supplement to the General Disclosure Package or the Prospectus or for
any additional information, and (iv) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or any order preventing or suspending the use of
the Preliminary Prospectus or the Prospectus, or of the institution of any proceedings for that
purpose or pursuant to Section 8A of the Act. The Company will use its reasonable best efforts to
prevent the issuance of any such order and to obtain as soon as possible the lifting thereof, if
issued.
(d) The Company will cooperate with the Representatives in endeavoring to qualify the
Securities for sale under the securities laws of such jurisdictions as the Representatives may
reasonably have designated in writing and will make such applications, file such documents, and
furnish such information as may be reasonably required for that purpose, provided the Company shall
not be required to qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not now so qualified or required to file such a consent.
The Company will, from time to time, prepare and file such statements, reports, and other
documents, as are or may be required to continue such qualifications in effect for so long a period
as the Representatives may reasonably request for distribution of the Securities.
(e) The Company will deliver to, or upon the order of, the Representatives, from time to time,
as many copies of the Preliminary Prospectus as the Representatives may reasonably request. The
Company will deliver to, or upon the order of, the Representatives during the period when delivery
of a Prospectus (or, in lieu thereof, the notice referred to under Rule 173(a) under the Act) is
required under the Act, as many copies of the Prospectus in final form, or as thereafter amended or
supplemented, as the Representatives may reasonably request. The Company will deliver to the
Representatives at or before the Closing Date, upon request, two signed copies of the Registration
Statement and all amendments thereto including all exhibits filed therewith, and will deliver to
the Representatives such number of copies of the Registration Statement (including such number of
copies of the exhibits filed therewith that may reasonably be requested), and of all amendments
thereto, as the Representatives may reasonably request.
(f) The Company will comply with the Act and the Rules and Regulations, and the Exchange Act,
and the rules and regulations of the Commission thereunder, so as to permit the completion of the
distribution of the Units as contemplated in this Agreement and the Prospectus. If during the
period in which a prospectus (or, in lieu thereof, the notice referred to under Rule 173(a) under
the Act) is required by law to be delivered by an Underwriter or dealer, any event shall occur as a
result of which, in the judgment of the Company or in the reasonable opinion of the Underwriters,
it becomes necessary to amend or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances existing at the time the
13
Prospectus is delivered to a purchaser, not misleading, or, if it is necessary at any time to
amend or supplement the Prospectus to comply with any law, the Company promptly will prepare and
file with the Commission an appropriate amendment to the Registration Statement or supplement to
the Prospectus so that the Prospectus as so amended or supplemented will not, in the light of the
circumstances when it is so delivered, be misleading, or so that the Prospectus will comply with
applicable law.
(g) If the General Disclosure Package is being used to solicit offers to buy the Units at a
time when the Prospectus is not yet available to prospective purchasers and any event shall occur
as a result of which, in the judgment of the Company or in the reasonable opinion of the
Underwriters, it becomes necessary to amend or supplement the General Disclosure Package in order
to make the statements therein, in the light of the circumstances under which they were made, not
misleading, or to make the statements therein not conflict with the information contained in the
Registration Statement then on file, or if it is necessary at any time to amend or supplement the
General Disclosure Package to comply with any applicable law, the Company promptly will prepare,
file with the Commission (if required) and furnish to the Underwriters and any dealers an
appropriate amendment or supplement to the General Disclosure Package.
(h) The Company will make generally available to its security holders, as soon as it is
practicable to do so, but in any event not later than 15 months after the Effective Date, an
earnings statement (which need not be audited) in reasonable detail, covering a period of at least
12 consecutive months beginning after the Effective Date, which earnings statement shall satisfy
the requirements of Section 11(a) of the Act and Rule 158 under the Act and will advise you in
writing when such statement has been so made available unless such earnings statement is filed via
XXXXX.
(i) Prior to the Closing Date, if requested, the Company will furnish to the Underwriters, as
soon as they have been prepared by or are available to the Company, a copy of any unaudited interim
financial statements of the Company for any period subsequent to the period covered by the most
recent financial statements appearing in the Registration Statement and the Prospectus.
(j) Except for securities issued in the Private Placement (as defined below), the Company
hereby agrees that until the Company consummates a Business Combination, it shall not issue any
shares of Common Stock or any options or other securities convertible into Common Stock, or any
shares of preferred stock which participate in any manner in the Trust Account or which vote as a
class with the Common Stock on a Business Combination.
(k) The Company will use its best efforts to effect and maintain the listing of the Securities
on the American Stock Exchange (“AMEX”) until the consummation of a Business Combination.
(l) The Company shall apply the net proceeds of its sale of the Units as set forth in the
Registration Statement, General Disclosure Package and the Prospectus and shall file such reports
with the Commission with respect to the sale of the Units and the application of the proceeds
therefrom as may be required in accordance with Rule 463 under the Act.
14
(m) The Company will maintain a transfer agent, warrant agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Units, Common Stock and Warrants,
as applicable.
(n) The Company will not take, directly or indirectly, any action that constitutes or might
reasonably be expected to constitute, the stabilization or manipulation of the price of any
securities of the Company until completion of the distribution of the Units in the offering
contemplated hereby.
(o) For a period of four years from the Effective Date, or until such earlier time upon which
the Company is required to be liquidated, the Company will maintain the registration of the
Securities under the provisions of the Exchange Act (except in connection with a going private
transaction).
(p) The Company will comply with all applicable securities and other applicable laws, rules
and regulations in each jurisdiction in which the Directed Units are offered in connection with the
Directed Unit Program.
(q) For a period of four years from the Effective Date, or until such earlier time upon which
the Company is required to be liquidated (or the Company ceases public reporting as a result of a
going private transaction), the Company, at its expense, shall cause its regularly engaged
independent registered public accounting firm 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 and the filing of the Company’s Form 10-Q quarterly report.
(r) The Company shall not consummate a Business Combination with any Initial Stockholder or
officer or director of the Company, or any entity which is affiliated with any Initial Stockholder
or officer or director of the Company, without first obtaining an opinion from an independent
investment banking firm that such Business Combination is fair to the Company’s stockholders from a
financial point of view.
(s) Except as described in the Registration Statement, General Disclosure Package and the
Prospectus, the Company shall not pay any Initial Stockholder or any of their affiliates or family
members any fees or compensation from the Company, for services rendered to the Company prior to,
or in connection with, the consummation of a Business Combination; provided that the Initial
Stockholders shall be entitled to reimbursement from the Company, subject to approval by the Board
of Directors of the Company, for their reasonable out-of-pocket expenses incurred in connection
with seeking and consummating a Business Combination.
(t) The Company will take all necessary actions to ensure that, upon and at all times after
the effectiveness of the Registration Statement, it will be in compliance in all material respects
with (i) all provisions of the Xxxxxxxx-Xxxxx Act that are then in effect and applicable to it and
shall take such steps as are necessary to ensure that it will be in compliance in all material
respects with other provisions of the Xxxxxxxx-Xxxxx Act which have been proposed but which
15
are not currently in effect upon the effectiveness of such provisions to the extent they are
applicable to the Company and (ii) the requirements of the American Stock Exchange’s AMEX Company
Guide if the Company’s securities are listed on the American Stock Exchange.
(u) For a period of four years from the Effective Date or until such earlier time upon which
the Company is required to be liquidated, the Company, upon request from the Representatives, will
furnish to the Representatives (i) 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
securities, and promptly furnish to the Representatives a copy of such registration statements,
financial statements and periodic and special reports as the Company shall be required to file with
the Commission and from time to time furnishes generally to holders of any such class of its
securities, and (ii) such additional documents and information with respect to the Company and the
affairs of any future subsidiaries of the Company as the Representatives may from time to time
reasonably request, in each such case subject to the execution of a confidentiality agreement
reasonably satisfactory to the Company.
(v) For a period of four years from the Effective Date or until such earlier time upon which
the Company is required to be liquidated, the Company will not take any action or actions which may
prevent or disqualify the Company’s use of Form S-1 (or other appropriate form) for the
registration of the Warrants and the Common Stock issuable upon exercise of the Warrants, under the
Act (except in connection with a going private transaction).
(w) In the event any person or entity (excluding attorneys, accountants and similar service
providers that are not affiliated or associated with FINRA and are not brokers or finders) is
engaged, in writing, to assist the issuer in finding or evaluating a merger candidate, the Company
will provide the following to the Representatives prior to consummation of a Business Combination:
(i) copies of agreements governing said services (which details or agreements may be appropriately
redacted to account for privilege or confidentiality concerns), and (ii) a justification as to why
the person or entity providing the merger and acquisition services should not be considered an
“underwriter or related person” with respect to the Company’s initial public offering as such term
is defined in Rule 2710(a)(6) of the NASD Conduct Rules. The Company also agrees that proper
disclosure of such arrangement or potential arrangement will be made in the proxy statement which
the Company will file for purposes of soliciting stockholder approval for the Business Combination.
(x) 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 generally accepted accounting principles 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.
(y) The Company shall, on the date hereof, retain its independent public accountants to audit
the financial statements of the Company as of the Closing Date (the
16
“Audited Financial Statements”) reflecting the receipt by the Company of the proceeds
of the initial public offering. As soon as the Audited Financial Statements become available, the
Company shall promptly file a Current Report on Form 8-K with the Commission (the “Closing
8-K”), which Closing 8-K shall contain the Company’s Audited Financial Statements. In
addition, upon receipt of the proceeds from the sale of any Option Units after the Closing Date,
the Company shall promptly file a second or amended Current Report on Form 8-K with the Commission,
which Report shall provide updated financial information to reflect the receipt of such additional
proceeds.
At or prior to the commencement of separate trading of the Warrants and Common Stock, the
Company shall promptly issue a press release and file a Current Report on Form 8-K announcing that
separate trading of the Warrants and Common Stock will begin on the AMEX.
(z) The Company shall advise FINRA if it is aware that any 5% or greater securityholder of the
Company becomes an affiliate or associated person of a FINRA member participating in the
distribution of the Units.
(aa) The Company shall, as set forth in the Trust Agreement and disclosed in the Prospectus,
cause the proceeds of the offering to be held in the Trust Account to be invested only in
“government securities” within the meaning of Section 2(a)(16) of the 1940 Act with a maturity of
180 days or less, or in money market funds meeting certain conditions under Rule 2a-7 promulgated
under the 0000 Xxx. The Company shall not invest any of the proceeds of the offering to be held in
the Trust Account in any mutual fund that invests in mortgages or mortgage-backed securities (other
than prime mortgages and mortgage-backed securities). The Company shall otherwise use its best
efforts to conduct its business (both prior to and after the consummation of an initial Business
Combination) in a manner so that it will not become subject to the 1940 Act.
(bb) The Company hereby agrees that prior to commencing a diligence investigation of, or if
earlier, entering into a confidentiality or other agreement with, a company with which the Company
may enter into a Business Combination (“Target Business”) or obtaining the services of any
vendor or service provider, it will use its best efforts to cause the Target Business or the vendor
or service provider to execute a waiver letter in the form attached hereto as Exhibit A and B,
respectively. Furthermore, prior to the Closing Date, each officer and director of the Company
shall execute an insider letter in the form attached hereto as Exhibit C.
(cc) The Company shall not take any action or omit to take any action that would cause the
Company to be in breach or violation of its amended and restated certificate of incorporation or
bylaws and, the Company shall not take any action to amend or modify, and will not support,
directly or indirectly, or in any way endorse or recommend that stockholders approve any amendment
or modification to, the provisions of its certificate of incorporation that apply to the Company
during the period commencing upon the filing of the amended and restated certificate of
incorporation with the Delaware Secretary of State and terminating upon the consummation of a
Business Combination, which action would result in such amendment or modification becoming
effective prior to a Business Combination.
17
(dd) The Company agrees: (i) that, prior to the consummation of a Business Combination, it
will submit such transaction to the Company’s stockholders for their approval (“Initial
Transaction Vote”) even if the nature of the acquisition is such as would not ordinarily
require stockholder approval under applicable state law; and (ii) that, in the event that the
Company does not effect a Business Combination within 24 months from the Effective Date, the
Company will be liquidated as described in the Prospectus. With respect to the Initial Transaction
Vote, the Company shall cause all of the Initial Stockholders to vote all shares of Common Stock
owned by them and acquired prior to this offering (the “Initial Shares”), in accordance
with the vote of the majority of the IPO Shares (as hereinafter defined) voted (in person or by
proxy), at a meeting of the Company’s stockholders called for the Initial Transaction Vote. At the
time the Company seeks approval of a Business Combination, the Company will offer each of the
holders of the Company’s Common Stock issued in this offering other than the Initial Stockholders
(the “IPO Shares”), which stockholders were stockholders on the record date for the meeting
of stockholders at which such initial Business Combination is to be approved, the right to convert
such holder’s IPO Shares to cash, if the stockholder votes against the Business Combination and the
Business Combination is approved and completed, at a per share price (the “Conversion
Price”) equal to the amount in the Trust Account (inclusive of (x) any interest income therein,
net of any income taxes on such interest and net of up to $3.5 million previously released to fund
the Company’s working capital requirements, and (y) the Deferred Discount), as of two business days
prior to the consummation of a Business Combination divided by the total number of IPO Shares
(including any shares held by the Initial Stockholders) outstanding on the date of calculation. If
the Company elects to proceed with a Business Combination, it will promptly after the consummation
of such Business Combination convert IPO Shares, based upon the Conversion Price, from those
holders of IPO Shares who affirmatively requested such conversion and who voted against the
Business Combination; provided that such holders continue to hold such IPO Shares through
consummation of the Business Combination. If a majority of the IPO Shares that are voted are not
voted in favor of a Business Combination or holders of 30% or more of the IPO Shares vote against
approval of a Business Combination and exercise their conversion rights, the Company will not
proceed with such Business Combination and will not convert such IPO Shares.
(ee) 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 a 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.
(ff) The Company agrees that the initial Target Business(es) that it acquires must
collectively have a fair market value equal to at least 80% of the sum of the balance in the Trust
Account (excluding the portion representing the Deferred Discount) at the time of such acquisition.
The fair market value of such business(es) shall be determined by the Board of Directors of the
Company based upon one or more standards generally accepted by the financial community. If the
Board of Directors of the Company is not able to independently determine that the Target
Business(es) have a sufficient fair market value, the Company will obtain an opinion from an
unaffiliated, independent investment banking firm with respect to the satisfaction of such
criteria. The Company will not be required to obtain an opinion from an investment
18
banking firm as to the fair market value if the Company’s Board of Directors independently
determines that the Target Business(es) have sufficient fair market value. The Company will not
acquire less than a controlling interest in the Target Business(es) (which would be at least 50% of
each Target Business’s voting securities).
(gg) The Company shall deposit into the Trust Account the $5,800,000 of proceeds from the
private placement (“Private Placement”) of 5,800,000 Warrants to the Company’s executive
officers, directors and Initial Stockholders, to be completed prior to the Closing Date.
(hh) Upon consummation of a Business Combination, the Company shall pay the Deferred Discount
to the Representatives, on behalf of the Underwriters, as the deferred portion of the Underwriters’
compensation. The Underwriters shall have no claim to payment of any interest earned on the
portion of the proceeds held in the Trust Account representing the Deferred Discount. If the
Company fails to consummate its initial Business Combination within the required time period set
forth in the Registration Statement, the Deferred Discount will not be paid to the Representatives
and will, instead, be included in the liquidating distribution of the proceeds held in the Trust
Account. In connection with any such liquidating distribution, the Underwriters forfeit any rights
or claims to the Deferred Discount, including any accrued interest thereon.
5. Costs and Expenses.
The Company will pay all costs, expenses and fees incident to the performance of the
obligations of the Company under this Agreement, including, without limiting the generality of the
foregoing, the following: accounting fees of the Company; the fees and disbursements of counsel
for the Company; the cost of printing and delivering to, or as requested by, the Underwriters
copies of the Registration Statement, Preliminary Prospectuses, the Prospectus, this Agreement and
the Listing Application; the filing fees of the Commission; the filing fees, costs and expenses
(including reasonable fees and disbursements of Underwriters’ counsel) incident to securing any
required review by FINRA of the terms of the sale of the Units; if necessary, the costs and
expenses (including reasonable fees and disbursements of Underwriters’ counsel and foreign counsel)
of qualifying the Securities for sale under state or foreign securities or “blue sky” laws; and the
Listing Fee of the American Stock Exchange. Notwithstanding the foregoing, (i) the cost of a
chartered aircraft incurred by or on behalf of the Company in connection with presentations to
prospective purchasers of the Units (the “Roadshow”) will be paid 50% by the Company and
50% by the Underwriters; (ii) each party will pay for their own hotel and commercial airfare
expenses incurred in connection with the Roadshow; and (iii) all other incidental costs and
expenses in connection with the Roadshow will be paid by the Underwriters. The Company shall not,
however, be required to pay for any of the Underwriters’ expenses except as otherwise specifically
provided herein and except that, if this Agreement shall not be consummated because the conditions
in Section 6 hereof are not satisfied by reason of any failure or refusal on the part of the
Company to perform any undertaking or satisfy any condition of this Agreement or to comply with any
of the terms hereof on its part to be performed, unless such failure or refusal is due primarily to
the default or omission of any Underwriter, the Company shall reimburse the several Underwriters
for reasonable out-of-pocket expenses,
19
including fees and disbursements of counsel, reasonably incurred in connection with
investigating, marketing and proposing to market the Units or in contemplation of performing their
obligations hereunder. The Company shall not be required to pay for any of the Underwriters’
expenses if this Agreement is terminated pursuant to Section 13 hereof.
6. Conditions of Obligations of the Underwriters.
The several obligations of the Underwriters to purchase the Firm Units on the Closing Date and
the Option Units, if any, on the Option Closing Date are subject to the accuracy, as of the
Applicable Time, the Closing Date or the Option Closing Date, as the case may be, of the
representations and warranties of the Company contained herein, and to the performance by the
Company of its covenants and obligations hereunder and to the following additional conditions:
(a) The Registration Statement and all post-effective amendments thereto shall have become
effective and the Prospectus shall have been filed as required by Rule 424 under the Act, within
the time period prescribed by, and in compliance with, the Rules and Regulations, and any request
of the Commission for additional information (to be included in the Registration Statement or
otherwise) shall have been disclosed to the Representatives and complied with to its reasonable
satisfaction. No stop order suspending the effectiveness of the Registration Statement, as amended
from time to time, shall have been issued and no proceedings for that purpose or pursuant to
Section 8A under the Act shall have been taken or, to the knowledge of the Company, shall be
contemplated or threatened by the Commission and no injunction, restraining order or order of any
nature by a Federal or state court of competent jurisdiction shall have been issued as of the
Closing Date which would prevent the issuance of the Units.
(b) The Representatives shall have received on and as of the Closing Date or the Option
Closing Date, as the case may be, the opinion of Xxxxxxxxx Xxxxxxx, LLP, counsel for the Company,
dated the Closing Date or the Option Closing Date, as the case may be, addressed to the
Underwriters in substantially the form attached hereto as Exhibit D.
In rendering such opinion, Xxxxxxxxx Traurig, LLP may rely as to matters governed by the laws
of states other than New York or Federal laws on local counsel in such jurisdictions, provided that
in each case Xxxxxxxxx Xxxxxxx, LLP shall state that they believe that they and the Underwriters
are justified in relying on such other counsel.
(c) The Representatives shall have received on and as of the Closing Date or the Option
Closing Date, as the case may be, an opinion and statement of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, counsel for the Underwriters, with respect to such matters as the Representatives may
reasonably request, and such counsel shall have received such documents and information as they may
reasonably request to enable them to pass upon such matters.
(d) The Representatives shall have received, on each of the date hereof, the Closing Date and,
if applicable, the Option Closing Date, a letter dated the date hereof, the Closing Date or the
Option Closing Date, as the case may be, in form and substance satisfactory to you, of Xxxxxxxxx,
Kass & Company, P.C. confirming that they are an independent registered
20
public accounting firm with respect to the Company within the meaning of the Act and the
applicable Rules and Regulations and the PCAOB and stating that in their opinion the financial
statements and schedules examined by them and included in the Registration Statement, the General
Disclosure Package and the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act and the related Rules and Regulations; and containing
such other statements and information as are ordinarily included in accountants’ “comfort letters”
to underwriters with respect to the financial statements and certain financial information
contained in the Registration Statement, the General Disclosure Package and the Prospectus.
(e) The Representatives shall have received on the Closing Date and, if applicable, the Option
Closing Date, as the case may be, a certificate or certificates of the Chief Executive Officer and
the Chief Financial Officer of the Company to the effect that, as of the Closing Date or the Option
Closing Date, as the case may be, each of them severally represents as follows:
(i) The Registration Statement has become effective under the Act and
no stop order suspending the effectiveness of the Registration Statement and
no order preventing or suspending the use of the Preliminary Prospectus or
the Prospectus has been issued, and no proceedings for such purpose or
pursuant to Section 8A of the Act have been taken or are, to his or her
knowledge, contemplated or threatened by the Commission;
(ii) The representations and warranties of the Company contained in
Section 1 hereof are true and correct as of the Closing Date or the Option
Closing Date, as the case may be (except for representations and warranties
which refer to a particular date, in which case such representations and
warranties shall be true and correct as of such date);
(iii) All filings required to have been made pursuant to Rules 424,
430A, 430B or 430C under the Act have been made as and when required by such
rules;
(iv) He or she has carefully examined the General Disclosure Package
and, in his or her opinion, as of the Applicable Time, the statements
contained in the General Disclosure Package did not contain any untrue
statement of a material fact, and such General Disclosure Package did not
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;
(v) He or she has carefully examined the Registration Statement and, in
his or her opinion, as of the effective date of the Registration Statement,
the Registration Statement and any amendments thereto did not contain any
untrue statement of a material fact and did not omit to state a material
fact required to be stated therein or necessary in
21
order to make the statements therein not misleading, and since the
effective date of the Registration Statement, no event has occurred which
should have been set forth in a supplement to or an amendment of the
Prospectus which has not been so set forth in such supplement or amendment;
(vi) He or she has carefully examined the Prospectus and, in his or her
opinion, as of its date and the Closing Date or the Option Closing Date, as
the case may be, the Prospectus and any amendments and supplements thereto
did not contain any untrue statement of a material fact and did not 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
(vii) Since the respective dates as of which information is given in
the Registration Statement, the General Disclosure Package and the
Prospectus, there has not been any material adverse change or any
development involving a prospective material adverse change in or affecting
the business, management, properties, assets, rights, operations, condition
(financial or otherwise) or prospects of the Company, whether or not arising
in the ordinary course of business.
(f) The Company shall have furnished to the Representatives such further certificates and
documents confirming the representations and warranties, covenants and conditions contained herein
and related matters as the Representatives may reasonably have requested.
(g) The Firm Units and Option Units, if any, shall have been duly listed, subject to notice of
issuance, on the American Stock Exchange.
(h) The Company shall have delivered to the Representatives executed copies of the Trust
Agreement, the Warrant Agreement, the Stock Escrow Agreement and each of the Insider Letters.
(i) FINRA shall not have raised any objection with respect to the fairness and reasonableness
of the underwriting terms and arrangements.
The opinions and certificates mentioned in this Agreement shall be deemed to be in compliance
with the provisions hereof only if they are in all material respects reasonably satisfactory to the
Representatives and to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6 shall not have been
fulfilled when and as required by this Agreement to be fulfilled, the obligations of the
Underwriters hereunder may be terminated by the Representatives by notifying the Company of such
termination in writing at or prior to the Closing Date or the Option Closing Date, as the case may
be.
22
In such event, the Company and the Underwriters shall not be under any obligation to each
other (except to the extent provided in Sections 5 and 7 hereof).
7. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter, its affiliates and each of
its and their respective directors, officers, members, employees, representatives and agents and
each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act (collectively the “Underwriter Indemnified Parties,” and
each an “Underwriter Indemnified Party”) against any loss, claim, damage, expense or
liability whatsoever (or any action, investigation or proceeding in respect thereof), joint or
several, to which such Underwriter Indemnified Party may become subject, under the Act or
otherwise, insofar as such loss, claim, damage, expense, liability, action, investigation or
proceeding arises out of or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any Registration Statement or the
Prospectus, or in any amendment or supplement thereto or document incorporated by reference
therein, or in any “road show” (as defined in Rule 433 under the Securities Act) for the offering
(“Marketing Materials”) or (ii) the omission or alleged omission to state in any
Preliminary Prospectus, any Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Marketing Materials, a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (iii) any breach of the representations
and warranties of the Company contained herein or failure of the Company to perform its obligations
hereunder or pursuant to any law, any act or failure to act, or any alleged act or failure to act,
by any Underwriter in connection with, or relating in any manner to, the Units or the offering of
the Units contemplated herein, and which is included as part of or referred to in any loss, claim,
damage, expense, liability, action, investigation or proceeding arising out of or based upon
matters covered by subclause (i), (ii) or (iii) above of this Section 7(a) (provided that the
Company shall not be liable in the case of any matter covered by this subclause (C) to the extent
that it is determined in a final judgment by a court of competent jurisdiction that such loss,
claim, damage, expense or liability resulted directly from any such act or failure to act
undertaken or omitted to be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse the Underwriter Indemnified Party promptly upon demand for any
legal fees or other expenses reasonably incurred by that Underwriter Indemnified Party in
connection with investigating, or preparing to defend, or defending against, or appearing as a
third party witness in respect of, or otherwise incurred in connection with, any such loss, claim,
damage, expense, liability, action, investigation or proceeding, as such fees and expenses are
incurred; provided, however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, expense or liability arises out of or is based upon an untrue
statement or alleged untrue statement in, or omission or alleged omission from any Preliminary
Prospectus, any Registration Statement or the Prospectus, or any such amendment or supplement
thereto, made in reliance upon and in conformity with written information furnished to the Company
by the Representatives by or on behalf of any Underwriter specifically for use therein, which
information the parties hereto agree is limited to the Underwriters’ Information (as defined in
Section 12). This indemnity agreement is not exclusive and will be in addition to any liability
which the Company might otherwise have and
23
shall not limit any rights or remedies which may otherwise be available at law or in equity to
each Underwriter Indemnified Party.
(b) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company
and its directors, its officers who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
(collectively the “Company Indemnified Parties” and each a “Company Indemnified
Party”) against any loss, claim, damage, expense or liability whatsoever (or any action,
investigation or proceeding in respect thereof), joint or several, to which such Company
Indemnified Party may become subject, under the Act or otherwise, insofar as such loss, claim,
damage, expense, liability, action, investigation or proceeding arises out of or is based upon (i)
any untrue statement or alleged untrue statement of a material fact contained in any Preliminary
Prospectus, any Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or (ii) the omission or alleged omission to state in any Preliminary Prospectus, any
Registration Statement or the Prospectus, or in any amendment or supplement thereto, a material
fact required to be stated therein or necessary to make the statements therein not misleading, but
in each case only to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written information furnished
to the Company by the Representatives by or on behalf of any Underwriter specifically for use
therein, which information the parties hereto agree is limited to the Underwriters’ Information (as
defined in Section 12), and shall reimburse the Company for any legal or other expenses reasonably
incurred by such party in connection with investigating or preparing to defend or defending
against, or appearing as a third party witness in respect of, or otherwise incurred in connection
with, any such loss, claim, damage, expense, liability, action, investigation or proceeding, as
such fees and expenses are incurred. Notwithstanding the provisions of this Section 7(b), in no
event shall any indemnity by an Underwriter under this Section 7(b) exceed the total compensation
received by such Underwriter in accordance with Section 2.
(c) Promptly after receipt by an indemnified party under this Section 7 of notice of the
commencement of any action, the indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under this Section 7, notify such indemnifying party in writing
of the commencement of that action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this Section 7 except to the
extent it has been materially prejudiced by such failure; and, provided, further, that the failure
to notify an indemnifying party shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 7. If any such action shall be brought against
an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense of such action with counsel reasonably
satisfactory to the indemnified party (which counsel shall not, except with the written consent of
the indemnified party, be counsel to the indemnifying party). After notice from the indemnifying
party to the indemnified party of its election to assume the defense of such action, except as
provided herein, the indemnifying party shall not be liable to the indemnified party under
Section 7 for any legal or other expenses subsequently incurred by the indemnified party in
connection with the defense of such action other than
24
reasonable costs of investigation; provided,
however, that any indemnified party shall have the right to employ separate counsel in any such
action and to participate in the defense of such action but the fees and expenses of such counsel
(other than
reasonable costs of investigation) shall be at the expense of such indemnified party
unless (i) the
employment thereof has been specifically authorized in writing by the Company in the case of a
claim for indemnification under Section 7(a) or the Underwriters in the case of a claim for
indemnification under Section 7(b), (ii) such indemnified party shall have been advised by its
counsel that there may be one or more legal defenses available to it which are different from or
additional to those available to the indemnifying party, or (iii) the indemnifying party has failed
to assume the defense of such action and employ counsel reasonably satisfactory to the indemnified
party within a reasonable period of time after notice of the commencement of the action or the
indemnifying party does not diligently defend the action after assumption of the defense, in which
case, if such indemnified party notifies the indemnifying party in writing that it elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying party shall not have
the right to assume the defense of (or, in the case of a failure to diligently defend the action
after assumption of the defense, to continue to defend) such action on behalf of such indemnified
party and the indemnifying party shall be responsible for legal or other expenses subsequently
incurred by such indemnified party in connection with the defense of such action; provided,
however, that the indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys at any time for all such indemnified parties (in addition to any
local counsel), which firm shall be designated in writing by the Representatives if the indemnified
parties under this Section 7 consist of any Underwriter Indemnified Party or by the Company if the
indemnified parties under this Section 7 consist of any Company Indemnified Parties. Subject to
this Section 7(c), the amount payable by an indemnifying party under Section 7 shall include, but
not be limited to, (x) reasonable legal fees and expenses of counsel to the indemnified party and
any other expenses in investigating, or preparing to defend or defending against, or appearing as a
third party witness in respect of, or otherwise incurred in connection with, any action,
investigation, proceeding or claim, and (y) all amounts paid in settlement of any of the foregoing.
No indemnifying party shall, without the prior written consent of the indemnified parties, settle
or compromise or consent to the entry of judgment with respect to any pending or threatened action
or any claim whatsoever, in respect of which indemnification or contribution could be sought under
this Section 7 (whether or not the indemnified parties are actual or potential parties thereto),
unless such settlement, compromise or consent (i) includes an unconditional release of each
indemnified party in form and substance reasonably satisfactory to such indemnified party from all
liability arising out of such action or claim and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
Subject to the provisions of the following sentence, no indemnifying party shall be liable for
settlement of any pending or threatened action or any claim whatsoever that is effected without its
written consent (which consent
shall not be unreasonably withheld or delayed), but if settled with
its written consent, if its consent has been unreasonably withheld or delayed or if there be a
judgment for the plaintiff in any such matter, the indemnifying party agrees to indemnify and hold
harmless any indemnified party from and against any loss or liability by reason of such settlement
or judgment. In addition, if at any time an indemnified party shall have requested that an
indemnifying party reimburse the indemnified party for fees and expenses of counsel, such
25
indemnifying party agrees that it shall be liable for any settlement of the nature
contemplated herein effected without its written consent if (i) such settlement is entered into
more than forty-five (45) days after receipt by such indemnifying party of the request for
reimbursement, (ii) such indemnifying party shall have received notice of the terms of such
settlement at least thirty (30) days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in accordance with such request
prior to the date of such settlement.
(d) If the indemnification provided for in this Section 7 is unavailable or insufficient to
hold harmless an indemnified party under Section 7(a) or Section 7(b), then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount paid, payable or
otherwise incurred by such indemnified party as a result of such loss, claim, damage, expense or
liability (or any action, investigation or proceeding in respect thereof), as incurred, (i) in such
proportion as shall be appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the Units, or (ii) if the
allocation provided by clause (i) of this Section 7(d) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) of
this Section 7(d) but also the relative fault of the Company on the one hand and the Underwriters
on the other with respect to the statements, omissions, acts or failures to act which resulted in
such loss, claim, damage, expense or liability (or any action, investigation or proceeding in
respect thereof) as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds from the offering
of the Units purchased under this Agreement (before deducting expenses) received by the Company
bear to the total discounts and commissions received by the Underwriters in connection with the
offering, in each case as set forth in the table on the cover page of the Prospectus (but in the
case of the Underwriters, including the Deferred Discount only to the extent actually received by
the Underwriters). The relative fault of the Company on the one hand and the Underwriters on the
other shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact relates
to information supplied by the Company on the one hand or the Underwriters on the other, the intent
of the parties and their relative knowledge, access to information and opportunity to correct or
prevent such untrue statement, omission, act or failure to act; provided that the parties hereto
agree that the written information furnished to the Company by the Underwriters for use in the
Preliminary Prospectus, any Registration Statement or the Prospectus, or in any amendment or
supplement thereto, consists solely of the Underwriters’ Information (as defined in Section 12).
The Company and the Underwriters agree that it would not be just and equitable if contributions
pursuant to this Section 7(d) were to be determined by pro rata allocation or by any other method
of allocation that does not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim, damage, expense,
liability, action, investigation or proceeding referred to above in this Section 7(d) shall be
deemed to include, for purposes of this Section 7(d), any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating, preparing to defend or
defending against or appearing as a third party witness in respect of, or otherwise incurred in
connection with, any such loss, claim, damage, expense, liability, action,
26
investigation or proceeding. Notwithstanding the provisions of this Section 7(d), no
Underwriter shall be required to contribute any amount in excess of the total compensation received
by such Underwriter in accordance with Section 2 less the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement, omission or alleged omission, act or alleged act or failure to act or alleged failure to
act. No person guilty of 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. The Underwriters’ obligations to contribute as provided in this Section 7(d)
are several in proportion to their respective obligations and not joint.
8. Directed Unit Program Indemnification.
(a) The Company agrees to indemnify and hold harmless Xxxxxx Xxxxxxx, each person, if any, who
controls Xxxxxx Xxxxxxx within the meaning of either Section 15 of the Securities Act or Section 20
of the Exchange Act and each affiliate of Xxxxxx Xxxxxxx within the meaning of Rule 405 of the
Securities Act (“Xxxxxx Xxxxxxx Entities”) from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action or claim) (i) caused by any
untrue statement or alleged untrue statement of a material fact contained in any material prepared
by or with the consent of the Company for distribution to Participants in connection with the
Directed Unit Program or caused by any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein not misleading; (ii)
caused by the failure of any Participant to pay for and accept delivery of Directed Units that the
Participant agreed to purchase; or (iii) related to, arising out of, or in connection with the
Directed Unit Program, other than losses, claims, damages or liabilities (or expenses relating
thereto) that are finally judicially determined to have resulted from the bad faith or gross
negligence of Xxxxxx Xxxxxxx Entities.
(b) In case any proceeding (including any governmental investigation) shall be instituted
involving any Xxxxxx Xxxxxxx Entity in respect of which indemnity may be sought pursuant to
Section 8(a), the Xxxxxx Xxxxxxx Entity seeking indemnity, shall promptly notify the Company in
writing and the Company, upon request of the Xxxxxx Xxxxxxx Entity, shall retain counsel reasonably
satisfactory to the Xxxxxx Xxxxxxx Entity to represent the Xxxxxx Xxxxxxx Entity and any others the
Company may designate in such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any Xxxxxx Xxxxxxx Entity shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of
such Xxxxxx Xxxxxxx Entity unless (i) the Company shall have agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include
both the Company and the Xxxxxx Xxxxxxx Entity and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests between them. The
Company shall not, in respect of the legal expenses of the Xxxxxx Xxxxxxx Entities in connection
with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for all Xxxxxx Xxxxxxx
Entities. Any such separate firm for the Xxxxxx Xxxxxxx Entities shall be designated in writing by
Xxxxxx Xxxxxxx. The Company shall not be liable for any settlement of any proceeding effected
without its
27
written consent, but if settled with such consent or if there be a final judgment for the
plaintiff, the Company agrees to indemnify the Xxxxxx Xxxxxxx Entities from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time a Xxxxxx Xxxxxxx Entity shall have requested the Company to reimburse it for fees and
expenses of counsel as contemplated by the second and third sentences of this paragraph, the
Company agrees that it shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after receipt by the
Company of the aforesaid request and (ii) the Company shall not have reimbursed the Xxxxxx Xxxxxxx
Entity in accordance with such request prior to the date of such settlement. The Company shall
not, without the prior written consent of Xxxxxx Xxxxxxx, effect any settlement of any pending or
threatened proceeding in respect of which any Xxxxxx Xxxxxxx Entity is or could have been a party
and indemnity could have been sought hereunder by such Xxxxxx Xxxxxxx Entity, unless such
settlement includes an unconditional release of the Xxxxxx Xxxxxxx Entities from all liability on
claims that are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section 8(a) is unavailable to a Xxxxxx
Xxxxxxx Entity or insufficient in respect of any losses, claims, damages or liabilities referred to
therein, then the Company in lieu of indemnifying the Xxxxxx Xxxxxxx Entity thereunder, shall
contribute to the amount paid or payable by the Xxxxxx Xxxxxxx Entity as a result of such losses,
claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Xxxxxx Xxxxxxx Entities on the other hand
from the offering of the Directed Units or (ii) if the allocation provided by clause 8(c)(i) above
is not permitted by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 8(c)(i) above but also the relative fault of the Company on
the one hand and of the Xxxxxx Xxxxxxx Entities on the other hand in connection with any statements
or omissions that resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company on the one hand
and the Xxxxxx Xxxxxxx Entities on the other hand in connection with the offering of the Directed
Units shall be deemed to be in the same respective proportions as the net proceeds from the
offering of the Directed Units (before deducting expenses) and the total underwriting discounts and
commissions received by the Xxxxxx Xxxxxxx Entities for the Directed Units, bear to the aggregate
initial public offering price set forth in the Prospectus of the Directed Units. If the loss,
claim, damage or liability is caused by an untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact, the relative fault of the Company on the
one hand and the Xxxxxx Xxxxxxx Entities on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement or the omission or alleged
omission relates to information supplied by the Company or by the Xxxxxx Xxxxxxx Entities and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
(d) The Company and the Xxxxxx Xxxxxxx Entities agree that it would not be just or equitable
if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the
Xxxxxx Xxxxxxx Entities were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred to in Section 8(c).
The amount paid or payable by the Xxxxxx Xxxxxxx Entities as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall
28
be deemed to include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by the Xxxxxx Xxxxxxx Entities in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this Section 8, no Xxxxxx Xxxxxxx
Entity shall be required to contribute any amount in excess of the amount by which the total price
at which the Directed Units distributed to the public were offered to the public exceeds the amount
of any damages that such Xxxxxx Xxxxxxx Entity has otherwise been required to pay. The remedies
provided for in this Section 8 are not exclusive and shall not limit any rights or remedies which
may otherwise be available to any indemnified party at law or in equity.
(e) The indemnity and contribution provisions contained in this Section 8 shall remain
operative and in full force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Xxxxxx Xxxxxxx Entity or the Company, its officers or
directors or any person controlling the Company and (iii) acceptance of and payment for any of the
Directed Units.
9. Notices.
All communications hereunder shall be in writing and, except as otherwise provided herein,
will be mailed, delivered, telecopied or telegraphed and confirmed as follows: if to the
Underwriters, to Lazard Capital Markets LLC, 00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn:
Xxxxxx Xxxxx, General Counsel and to Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attn: Xxxxx Xxxxxxxxx, Executive Director; if to the Company to Xxxxx X. Xxxxxxxx,
Chief Executive Officer, c/o Hauslein & Company, Inc., 00000 XX Xxxxx Xxxxxxx, Xxxxx 000, Xxxx
Xxxxx, Xxxxxxx 00000.
10. Termination.
This Agreement may be terminated by you by notice to the Company (a) at any time prior to the
Closing Date or any Option Closing Date (if different from the Closing Date and then only as to
Option Units) if any of the following has occurred: (i) since the respective dates as of which
information is given in the Registration Statement, the General Disclosure Package and the
Prospectus, a Material Adverse Effect shall have occurred, (ii) trading in securities generally on
the New York Stock Exchange, Nasdaq Global Market or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the Company on any exchange or in the
over-the-counter market, shall have been suspended or materially limited, or minimum or maximum
prices or maximum range for prices shall have been established on any such exchange or such market
by the Commission, by such exchange or market or by any other regulatory body or governmental
authority having jurisdiction, (iii) a banking moratorium shall have been declared by Federal or
state authorities or a material disruption has occurred in commercial banking or securities
settlement or clearance services in the United States, (iv) the United States shall have become
engaged in hostilities, or the subject of an act of terrorism, or there shall have been an outbreak
of or escalation in hostilities involving the United States, or there shall have been a declaration
of a national emergency or war by the United States or (v) there shall have occurred such a
material adverse change in general economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States shall be such) as to make
it, in the judgment of the
29
Representatives, impracticable or inadvisable to proceed with the sale or delivery of the
Units on the terms and in the manner contemplated in the Preliminary Prospectus and the Prospectus;
or
(b) as provided in Sections 6 and 13 of this Agreement.
11. Successors.
This Agreement has been and is made solely for the benefit of the Underwriters and the Company
and their respective successors, executors, administrators, heirs and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will have any right or
obligation hereunder. No purchaser of any of the Units from any Underwriter shall be deemed a
successor or assignee merely because of such purchase.
12. Information Provided by Underwriters.
The Company and the Underwriters acknowledge and agree that the only information furnished or
to be furnished by any Underwriter to the Company for inclusion in the Registration Statement, the
Preliminary Prospectus or the Prospectus consists of the information set forth in the third, tenth
and eleventh paragraphs under the caption “Underwriting” in the Prospectus and each Underwriter’s
name as contained on the cover page of the Prospectus (the “Underwriters’ Information”).
13. Default by Underwriters.
If on the Closing Date or the Option Closing Date, as the case may be, any Underwriter shall
fail to purchase and pay for the portion of the Units which such Underwriter has agreed to purchase
and pay for on such date (otherwise than by reason of any default on the part of the Company), you,
as Representatives of the Underwriters, shall use your reasonable efforts to procure within 36
hours thereafter one or more of the other Underwriters, or any others, to purchase from the Company
such amounts as may be agreed upon and upon the terms set forth herein, the Units which the
defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours you, as such
Representatives, shall not have procured such other Underwriters, or any others, to purchase the
Units agreed to be purchased by the defaulting Underwriter or Underwriters, then (a) if the
aggregate number of Units with respect to which such default shall occur does not exceed 10% of the
Units to be purchased on the Closing Date or the Option Closing Date, as the case may be, the other
Underwriters shall be obligated, severally, in proportion to the respective numbers of Units which
they are obligated to purchase hereunder, to purchase the Units which such defaulting Underwriter
or Underwriters failed to purchase, or (b) if the aggregate number of Units with respect to which
such default shall occur exceeds 10% of the Units to be purchased on the Closing Date or the Option
Closing Date, as the case may be, the Company or you as the Representatives of the Underwriters
will have the right, by written notice given within the next 36-hour period to the parties to this
Agreement, to terminate this Agreement without liability on the part of the non-defaulting
Underwriters or of the Company except to the extent provided in Section 7 hereof. In the event of
a default by any Underwriter or Underwriters, as set forth in this Section 13, the Closing Date or
Option Closing Date, as the case may be, may be postponed for such period, not exceeding seven
days, as you, as Representatives, may determine in order that the required changes in the
Registration Statement, the General
30
Disclosure Package or in the Prospectus or in any other documents or arrangements may be
effected. The term “Underwriter” includes any person substituted for a defaulting Underwriter.
Any action taken under this Section 13 shall not relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
14. Absence of Fiduciary Duty.
The Company acknowledges and agrees that:
(a) the Underwriters’ responsibility to the Company is solely contractual in nature, the
Underwriters have been retained solely to act as underwriters in connection with the offering of
the Units contemplated herein and no fiduciary, advisory or agency relationship between the Company
and the Underwriters has been created in respect of any of the transactions contemplated by this
Agreement, irrespective of whether the Underwriters, the Representatives or Lazard Frères & Co. LLC
have advised or are advising the Company on other matters;
(b) the price of the Units set forth in this Agreement was established following arms-length
negotiations and the Company is capable of evaluating and understanding, and understands and
accepts, the terms, risks and conditions of the transactions contemplated by this Agreement;
(c) it has been advised that the Underwriters, the Representatives, Lazard Frères & Co. LLC
and their respective affiliates are engaged in a broad range of transactions which may involve
interests that differ from those of the Company and that the Underwriters have no obligation to
disclose such interests and transactions to the Company by virtue of any fiduciary, advisory or
agency relationship; and
(d) it waives, to the fullest extent permitted by law, any claims it may have against the
Underwriters for breach of fiduciary duty and agrees that the Underwriters shall have no liability
(whether direct or indirect) to the Company in respect of such a fiduciary duty claim or to any
person asserting a fiduciary duty claim on behalf of or in right of the Company, including
stockholders, employees or creditors of the Company.
15. Miscellaneous.
The reimbursement, indemnification and contribution agreements contained in this Agreement and
the representations, warranties and covenants contained in this Agreement shall remain in full
force and effect regardless of (a) any termination of this Agreement, (b) any investigation made by
or on behalf of any Underwriter or controlling person thereof, or by or on behalf of the Company or
its directors or officers and (c) delivery of and payment for the Units under this Agreement.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument.
31
This Agreement shall be governed by, and construed in accordance with, the law of the State of
New York, including, without limitation, Section 5-1401 of the New York General Obligations Law.
In any proceeding relating to the Registration Statement, the Preliminary Prospectus, the
Prospectus or any supplement or amendment thereto, each party hereby (i) irrevocably submits to the
jurisdiction of the United States District Court sitting in the Southern District of New York and
the courts of the State of New York located in New York county for the purposes of any suit, action
or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby
and (ii) hereby waives, and agrees not to assert in any such suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of such court, that the suit, action or
proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding
is improper. Each party hereto consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address in effect for notices to it under
this Agreement and agrees that such service shall constitute good and sufficient service of process
and notice thereof. Nothing contained in this section shall affect or limit any right to serve
process in any other manner permitted by law.
If the foregoing letter is in accordance with your understanding of our agreement, please sign
and return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among
the Company and the several Underwriters in accordance with its terms.
32
| Very truly yours, ATLAS ACQUISITION HOLDINGS CORP. |
||||
| By | /s/ Xxxxx X. Xxxxxxxx | |||
| Name: | Xxxxx X. Xxxxxxxx | |||
| Title: | Chief Executive Officer | |||
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
is hereby confirmed and accepted as
of the date first above written.
LAZARD CAPITAL MARKETS LLC
| By | /s/ Xxxxx X. XxXxxxxx, Xx. | |||
| Authorized Officer | ||||
XXXXXX XXXXXXX & CO. INCORPORATED
| By | /s/ Xxxxx Maslynsky | |||
| Authorized Officer | ||||
As Representatives of the several
Underwriters listed on Schedule I
Underwriters listed on Schedule I
SCHEDULE I
Schedule of Underwriters
| Number of Firm Units | ||||
| Underwriter | to be Purchased | |||
Lazard Capital Markets, LLC |
10,000,000 | |||
Xxxxxx Xxxxxxx & Co. Incorporated |
10,000,000 | |||
Total |
20,000,000 | |||
SCHEDULE II
Trade date: January 25, 2008
Settlement date: January 30, 2008
Settlement date: January 30, 2008
In connection with the IPO of Atlas Acquisition Holdings Corp., please note that the final terms
of the offering have been modified as follows:
| 1. | The deferred IPO underwriting discount to be held in trust until the consummation of the initial business combination increased from $7,000,000 to $8,955,000. |
| 2. | The percentage of public offering proceeds held in trust increased from 99.0% to 100.0%, for a total of $200,000,000. |
| 3. | The exercise price for the warrants, including the insider warrants, was reduced from $7.50 to $7.00. As such, each warrant now entitles the holder to purchase one share of the Company’s common stock at a reduced price of $7.00. |
| 4. | Other amounts and percentages derived from the information in items (1) (2) and (3) above will be updated in the final prospectus accordingly. The numbers above assume no exercise of the underwriters over-allotment option. |
EXHIBIT A
Atlas Acquisition Holdings Corp.
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Gentlemen:
Reference is made to the Final Prospectus of Atlas Acquisition Holdings Corp. (the “Company”),
dated , 2008 (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 $200,000,000, for the benefit of the Public Stockholders and that the
Company may disburse monies from the Trust Account only (i) to the Public Stockholders in the event
of the redemption of their shares or the liquidation of the Company, (ii) to the Company, interest
earned on funds in the Trust Account in an aggregate amount of up to (a) $3,500,000 to fund
expenses related to investigating and selecting a target business and the Company’s other working
capital requirements and (b) any amounts needed by the Company to pay its income or other tax
obligations or (iii) to the Company and the underwriters after the Company consummates an initial
Business Combination.
For and in consideration of the Company agreeing to evaluate the undersigned for purposes of
consummating an initial 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
(the “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.
A-1
EXHIBIT B
Atlas Acquisition Holdings Corp.
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Gentlemen:
Reference is made to the Final Prospectus of Atlas Acquisition Holdings Corp. (the “Company”),
dated , 2008 (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 $200,000,000, for the benefit of the Public Stockholders and that the
Company may disburse monies from the Trust Account only (i) to the Public Stockholders in the event
of the redemption of their shares or the liquidation of the Company, (ii) to the Company, interest
earned on funds in the Trust Account in an aggregate amount of up to (a) $3,500,000 to fund
expenses related to investigating and selecting a target business and the Company’s other working
capital requirements and (b) any amounts needed by the Company to pay its income or other tax
obligations or (iii) to the Company and the underwriters after the Company consummates an initial
Business Combination.
For and in consideration of the Company engaging 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 (the “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.
B-1
[FORM OF LETTER AGREEMENT]
January ___, 2008
Atlas Acquisition Holdings Corp.
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx
c/o Hauslein & Company, Inc.
00000 XX Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxx
Lazard Capital Markets LLC
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Initial Public Offering
Ladies and Gentlemen:
Lazard Capital Markets LLC and Xxxxxx Xxxxxxx & Co. Incorporated are acting as the
representatives of the underwriters (the “Representatives”) of the initial public offering
(the “IPO”) of units (the “Units”) consisting of one share of Common Stock of Atlas
Acquisition Holdings Corp. (the “Company”), and one warrant (a “Warrant”), each
whole Warrant entitling the holder thereof to purchase one share of Common Stock of the Company.
Lazard Capital Markets LLC, Xxxxxx Xxxxxxx & Co. Incorporated, and any other underwriters are
referred to collectively as the “Underwriters.” The undersigned stockholder, officer,
and/or director of the Company, in consideration of the Underwriters underwriting the IPO, hereby
agrees as set forth below. Certain capitalized terms used herein are defined in Section 1 hereof.
1. As used herein, (i) a “Business Combination” shall mean an acquisition by merger,
capital stock exchange, asset or stock acquisition, reorganization or otherwise, of an operating
business selected by the Company; (ii) “Founders” shall mean all stockholders, officers,
and directors who are stockholders of the Company immediately prior to the IPO; (iii) “Common
Stock” shall mean the Company’s common stock, par value $0.001 per share; (iv) “Founders’
Shares” shall mean all of the shares of Common Stock of the Company owned by the Founders prior
to the IPO; and (v) “IPO Shares” shall mean the shares of Common Stock issued in the
Company’s IPO.
2. If the Company solicits approval of its stockholders of a Business Combination, the
undersigned will vote all Founders’ Shares owned by him or it in accordance with the majority of
the votes cast by the holders of the IPO Shares.
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3. In the event that the Company fails to consummate a Business Combination within 24 months
from the effective date (the “Effective Date”) of the registration statement relating to
the IPO (such date being referred to herein as the “Termination Date”), the undersigned, to
the fullest extent permitted by the Delaware General Corporation Law (the “DGCL”), will
(i) cause the trust account established under the Investment Management Trust Agreement to be
entered into between the Company and American Stock Transfer & Trust Company (the “Trust
Account”) to be liquidated and distributed to the holders of IPO Shares, and (ii) take all
reasonable actions within his or its power to 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
(“Claim”) to participate in any liquidating distribution of the Trust Account as part of
the Company’s plan of distribution with respect to the Founders’ Shares if the Company fails to
consummate a Business Combination and the Trust Account is consequently liquidated. The
undersigned 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 to or against the Trust Account and
will not seek recourse against the Trust Account for any reason whatsoever. The undersigned
acknowledges and agrees that there will be no distribution from the Trust Account with respect to
any Warrants, all rights of which will terminate on the Company’s liquidation. [THIS PROVISION FOR
XXXXX XXXXXXXX AND XXXXXX XXXXXX ONLY.] In the event of the liquidation of the Trust Account, the
undersigned agrees to indemnify and hold harmless the Company against any and all loss, liability,
claims, 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,
whether pending or threatened, or any claim whatsoever) which the Company may become subject as a
result of any claim by any vendor, service provider, financing provider, or other person who is
owed money by the Company for services rendered or products sold or contracted for, or by any
target business, but only to the extent necessary to ensure that such loss, liability, claim,
damage, or expense does not reduce the amount of funds in the Trust Account and only if such a
vendor, service provider, financing provider, or other person or prospective target business does
not execute an agreement waiving any claims against the Trust Account. Additionally, the
undersigned will not have any personal liability as to any claims under the Company’s indemnity of
the underwriters of the IPO against certain liabilities, including liabilities under the Securities
Act.
4. [THIS PROVISION FOR XXXXX XXXXXXXX AND XXXXXX XXXXXX ONLY.] In order to minimize potential
conflicts of interest that may arise from multiple corporate affiliations, the undersigned agrees
to present to the Company for its consideration, prior to presentation to any other person or
entity, those business opportunities to acquire an operating business the undersigned reasonably
believes are suitable opportunities for the Company, until the earlier of the consummation by the
Company of a Business Combination, the liquidation of the Company, or until such time as the
undersigned ceases to be an officer or director of the Company, subject to any pre-existing
fiduciary or contractual obligations the undersigned might have. [THIS PROVISION IS FOR DIRECTORS
ONLY.] In order to minimize potential conflicts of interest that may arise from multiple business
affiliations, the undersigned acknowledges that the Company does not expect its independent
directors to present to the Company for its consideration, prior to presentation to any other
person or entity, any investment or business opportunities. [THIS PROVISION IS FOR SPECIAL
ADVISORS ONLY.] In order to minimize potential conflicts of interest that may arise from
C-2
multiple affiliations, the undersigned acknowledges that, as a special advisor to the Company,
he has no formal arrangements or agreements with the Company to provide services to the Company and
he will not receive any remuneration. The undersigned acknowledges that he owes no fiduciary duty
to the Company nor will he be entitled, in his capacity as a special advisor, to vote on any
transaction or other matters relating to the Company. Furthermore, the undersigned acknowledges
that in his capacity as a special advisor, he will not be able to formally recommend any
transactions to the Company’s stockholders on the Company’s behalf, sit on the Company’s board of
directors, or sit on any committee of the Company’s board of directors. [THIS PROVISION IS FOR
PROMETHEAN PARTNERS ONLY.] In order to minimize potential conflicts of interest that may arise
from multiple affiliations, the undersigned acknowledges and agrees, on behalf of Promethean
Investments LLP and its managed funds (“Promethean”), that he will provide the Company a
right of first refusal with respect to any potential investment opportunity except (i) any
investment in an entity incorporated or formed in the United Kingdom which does not exceed $100
million of equity by Promethean or (ii) any investment in an entity incorporated or formed in India
which does not exceed $50 million of equity by Promethean India. The undersigned acknowledges that
the Company may have an interest in a transaction below these thresholds, and Promethean would not
be obligated to present the Company with that transaction. The undersigned further acknowledges
that this right of first refusal will continue until the Company has made an initial investment
that has been approved by the Company’s stockholders or until the Company’s liquidation, whichever
is earlier. [THIS PROVISION IS FOR STOCKHOLDERS ONLY.] The undersigned acknowledges and agrees
that the Company will not consummate any Business Combination with any company with which the
undersigned has had any discussions, formal or otherwise, prior to the consummation of the IPO,
with respect to a Business Combination.
5. The undersigned acknowledges and agrees that the Company will not consummate any Business
Combination with any company with which the undersigned has had any discussions, formal or
otherwise, prior to the consummation of the IPO, with respect to a Business Combination.
6. 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 Founders unless the
Company obtains an opinion from an independent investment banking firm that the business
combination is fair to the Company’s stockholders from a financial perspective.
7. 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 (such date being referred to herein as the “Consummation Date”); provided,
however, that commencing upon the Consummation Date, Xxxxxxxx & Company, Inc. shall be allowed to
charge the Company $10,000 per month to compensate it for certain administrative, technology, and
secretarial services, as well as the use of certain limited office space, until the earlier of the
Company’s consummation of a Business Combination or its liquidation. The undersigned, and certain
existing officers, directors, stockholders, or affiliates of the Company, shall also be entitled to
reimbursement from the Company for the out-of-pocket expenses incurred by them in connection with
certain activities
C-3
on the Company’s behalf, such as identifying and investigating possible business targets and
Business Combinations.
8. 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.
9. The undersigned will, pursuant to and subject to the terms of an Escrow Agreement to be
entered into by and among the Company, the Founders, and American Stock Transfer & Trust Company,
as escrow agent, escrow all Founders’ Shares held by the undersigned, directly or indirectly, until
the date that is one year after the consummation of a Business Combination unless (i) the last
sales price of the Company’s common stock equals or exceeds $18.00 per share (as adjusted for any
stock splits) for any 20 trading days within any 30-trading-day period or (ii) the Company
consummates a subsequent liquidation, merger, stock exchange, or other similar transaction that
results in all of our stockholders having the right to exchange their shares of common stock for
cash, securities, or other property in which case the Founders’ Shares will be released from escrow
simultaneously with the closing of such transaction; provided, however, that the foregoing sentence
shall not apply to transfers (A) by an entity holding initial shares to persons controlling,
controlled by, or under common control with such entity, or to any stockholder, member, partner, or
limited partner of such entity, (B) to relatives and trusts for estate planning purposes, or (C) by
private sales made at or prior to the consummation of a business combination at prices no greater
than the price at which the shares were originally purchased, in each case where the transferee
agrees to the terms of the escrow agreement; provided, however, that with respect to each of the
transfers described in clauses (A), (B), and (C) of this sentence, prior to such transfer, the
transferee, or the trustee or legal guardian on behalf of any transferee, agrees to the terms of
this letter.
10. [THIS PROVISION IS FOR DIRECTORS ONLY.] The undersigned agrees to be a Director of the
Company until the earlier of the consummation by the Company of a Business Combination or the
dissolution and liquidation of the Company. The undersigned’s biographical information furnished
to the Company and the Representatives 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 Section 401 of Regulation S-K,
promulgated under the Securities Act of 1933, as amended. The undersigned’s Questionnaire
furnished to the Company and the Representatives and annexed as Exhibit B hereto is 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,
(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-4
(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.
11. The undersigned hereby agrees to not propose, or vote in favor of, an amendment to the
Company’s Certificate of Incorporation to (i) extend the period of time in which the Company must
consummate a Business Combination prior to its liquidation, (ii) remove or modify the requirement
of the Company to seek stockholder approval of a Business Combination, or (iii) remove or modify
the requirement of the Company to allow stockholders to seek conversion of their shares if they did
not vote in favor of an approved and completed Business Combination. This paragraph may not be
modified or amended under any circumstances.
12. [THIS PROVISION FOR XXXXX XXXXXXXX AND XXXXXX XXXXXX ONLY.] In the event that the Company
does not consummate a Business Combination and must liquidate and its remaining net assets are
insufficient to complete such liquidation, the undersigned agrees to advance such funds necessary
to complete such liquidation and agrees not to seek repayment for such expenses. The undersigned
represents to the Company that he is capable of funding a shortfall in the Trust Account to satisfy
his or its foreseeable indemnification obligations.
13. [THIS PROVISION IS FOR DIRECTORS ONLY.] The undersigned has full right and power, without
violating any agreement by which he is bound, to enter into this Agreement and to serve as a
Director of the Company.
14. The undersigned acknowledges and understands that the Underwriters and the Company will
rely upon the agreements, representations, and warranties set forth herein in proceeding with the
IPO.
15. This Agreement shall be binding on the undersigned and such person’s respective
successors, heirs, personal representatives, and assigns. This Agreement shall terminate on the
earlier of (i) the date upon which a Business Combination is consummated, or (ii) the Termination
Date; provided, however, that any such termination shall not relieve the undersigned from any
liability resulting from or arising out of any breach of any agreement or covenant hereunder
occurring prior to the termination of this Agreement.
16. The undersigned authorizes any employer, financial institution, or consumer credit
reporting agency to release to the Representatives and its legal representatives or agents
(including any investigative search firm retained by the Representatives) 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 Representatives 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.
17. The undersigned hereby waives his or its right to exercise conversion rights with respect
to any Founders’ Shares owned by the undersigned, directly or indirectly, and agrees that he or she
will not seek conversion for cash with respect to such Founders’ Shares in
C-5
connection with any vote to approve a Business Combination (as is more fully defined in the
final prospectus relating to the IPO).
18. In order to induce you and the other Underwriters to enter into the proposed Underwriting
Agreement in connection with the IPO, the undersigned hereby agrees to execute an escrow agreement
among the Founders, the Company, and American Stock Transfer & Trust Company simultaneously with
the execution of the proposed Underwriting Agreement, whereby a portion of the undersigned’s
Founders’ Shares will be held in escrow until the earlier of the time that the Underwriters’
over-allotment option is exercised or expires. An amount equal to 15% of such Founders’ Shares
shall be cancellable as set forth below (the “Cancellable Shares”). The undersigned
understands that (i) if the Underwriters do not exercise any part of their over-allotment option,
then the undersigned’s Cancellable Shares shall be cancelled upon expiration of the over-allotment
option, and the undersigned will receive no consideration for such cancellation, and (ii) if the
Underwriters exercise their over-allotment option in part, a pro rata amount of the undersigned’s
Cancellable Shares shall be cancelled, and the undersigned will receive no consideration for such
cancellation.
19. 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 conflicts of law principles that would result in
the application of the substantive laws of another jurisdiction. The undersigned hereby agrees that
any action, proceeding or claim against the undersigned arising out of or relating in any way to
this Agreement shall be brought and enforced in the courts of the State of New York or the United
States District Court for the Southern District of New York, and irrevocably submits to such
jurisdiction, which jurisdiction shall be exclusive. The undersigned hereby waives any objection
to such exclusive jurisdiction and that such courts represent an inconvenient forum.
20. No term or provision of this Agreement may be amended, changed, waived, altered, or
modified except by written instrument executed and delivered by the undersigned with the written
consent of the Company and the Representatives.
[Signature Page Follows]
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C-7
EXHIBIT D
Form of Opinion
(See attached.)
D-1
