Exhibit 10.12
SP ACQUISITION HOLDINGS, INC.
FOUNDER'S UNITS AGREEMENT
THIS AGREEMENT (this "AGREEMENT"), dated as of August 8, 2007, is entered
into by and among SP Acquisition Holdings, Inc., a Delaware corporation (the
"COMPANY"), SP Acq LLC, a Delaware limited liability company (the "INITIAL
FOUNDER"), Steel Partners II, L.P., a Delaware limited partnership ("SP II"),
Xxxxxxx Xxxxxxx, Xxxxxx XxXxx, Xxxxxx X. Xxxxxx, Xxxxxxx Xxxxxxxx and S.
Xxxxxxxx Xxxxxx (each a "FOUNDER" and collectively, together with the Initial
Founder and SP II, the "FOUNDERS").
WITNESSETH
WHEREAS, the Founders in aggregate hold 7,500,000 units (the "UNITS")
consisting of one share of the Company's common stock, par value $0.001 per
share (the "SHARES") and one warrant to purchase one share of common stock (the
"WARRANTS");
WHEREAS, the Company has filed a registration statement on Form S-1 (File
No. 333-142696) (the "REGISTRATION STATEMENT") for its initial public offering
of Units (the "IPO");
WHEREAS, the Company may decide to increase or decrease the number of
Units issued in the IPO;
WHEREAS, the Company and the Founders confirm their understanding that the
Shares being sold to the public as part of the Units shall represent
approximately 80% of the Company's outstanding share capital following
consummation of the IPO and any exercise of the underwriters' overallotment
option (such percentage, the "PUBLIC FLOAT") regardless of whether the number of
Units issued in the IPO are increased or decreased;
WHEREAS, the Company may decide to increase or decrease the number of
Units issued in the IPO;
NOW THEREFORE, in consideration of the mutual promises contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:
Section 1. ADJUSTMENT FOR OVER-ALLOTMENT OPTION EXERCISE.
(A) The Company hereby agrees with each of the Founders, that it will
declare and pay to its stockholders a dividend of Units (the "OVER-ALLOTMENT
ADJUSTMENT UNITS"), so that the number of Units the Company sells to the public
in the IPO including as a result of the exercise of the underwriters'
over-allotment option will maintain the Public Float. Each of the Founders
(other than the Initial Founder) hereby irrevocably assigns to the Initial
Founder, all Over-Allotment Adjustment Units which it has the right to receive
pursuant to such dividend. Unless otherwise agreed to by the Initial Founder,
each of the Founders agrees to take any and all action reasonably requested by
the Company or the Initial Founder necessary to effect such assignment; PROVIDED
that neither the Founders nor the Company shall make or receive any cash payment
in respect of any such assignment.
(B) The Initial Founder agrees to deposit in escrow all of the
Over-Allotment Adjustment Units it receives from the Company and from the other
Founders pursuant to the escrow agreement dated as of _________, 2007 among the
Initial Founder and Continental Stock Transfer & Trust Company, as escrow agent
(the "ESCROW AGREEMENT").
Section 2. INITIAL FOUNDER'S UNITS ADJUSTMENT. Each of the Founders hereby
agrees with the Company, and the Company hereby agrees with each of the
Founders, that if the number of Units the Company offers to the public in the
IPO is increased or decreased from the number shown in the Registration
Statement filed with the Securities and Exchange Commission as of the date
hereof, then the number of Units held by the Initial Founder immediately prior
to consummation of the IPO will be adjusted in the same proportion as the
increase or decrease in the Units offered in the IPO including the Units subject
to the underwriters' overallotment option in order to maintain the Public Float.
Such increase or decrease, if any, shall be effected by dividend or surrender
and cancellation of certificates evidencing such Initial Founder's Units, or
such other manner as elected by the Company in its sole discretion. Such
increase or decrease, if any, in the case of each of the Founders, other than to
the Initial Founder, shall be governed by the terms of that certain Founder's
Units and Founder's Additional Warrants Purchase Agreement, dated as of June __,
2007 (the "DIRECTOR PURCHASE AGREEMENT") by and among the Company, the Initial
Founder, Xxxxxxx Xxxxxxx, Xxxxxx XxXxx, Xxxxxx X. Xxxxxx, Xxxxxxx Xxxxxxxx and
S. Xxxxxxxx Xxxxxx (each individual a "PURCHASER" and collectively the
"PURCHASERS") in the case of Purchasers and that certain Founder's Units
Purchase Agreement, dated as of March 30, 2007 (the "SP II PURCHASE AGREEMENT")
by and among the Company, the Initial Founder and SP II in the case of SP II.
Each of the Founders agrees to take any and all action reasonably requested by
the Company necessary to effect such adjustment; PROVIDED that neither the
Founders nor the Company shall make or receive any cash payment in respect of
any such adjustment.
Section 3. FURTHER AGREEMENTS OF THE FOUNDERS.
(A) Each Founder severally and not jointly acknowledges and agrees that
any additional Units it may acquire pursuant to Section 1 or Section 2 of this
Agreement (A) shall be subject to the voting, waiver of liquidation, transfer
restrictions and forfeiture conditions set forth in the Purchase Agreement,
dated as of March 22, 2007 (in the case of the Initial Founder), the SP II
Purchase Agreement (in the case of SP II) and the Director Purchase Agreement
dated as of June ___, 2007 (in the case of Xxxxxxx Xxxxxxx, Xxxxxx XxXxx, Xxxxxx
X. Xxxxxx, Xxxxxxx Xxxxxxxx and S. Xxxxxxxx Xxxxxx), and (B) shall bear the same
legend as the Founder's Units held on the date hereof. In addition, in the event
the underwriters' over-allotment option is not exercised in whole or in part,
any Over-Allotment Adjustment Units issued pursuant hereto shall be subject to
the forfeiture provisions set forth in the Escrow Agreement.
(B) Each of the Initial Founder and SP II agrees that notwithstanding the
definition of "Permitted Transferees" contained in the Purchase Agreement or SP
II Purchase Agreement, as applicable, it shall not transfer any Founder's Units,
or any shares of common stock or warrants included in such Founder's Units
(including the shares of common stock underlying such warrants) to its
respective limited partners or members in their capacity as such limited
partners or members. Notwithstanding the foregoing, in no event shall the
restrictions contained in this Section 3B continue beyond one year after the
Company completes its initial business combination.
Section 4. MISCELLANEOUS.
(A) SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided herein,
all covenants and agreements contained in this Agreement by or on behalf of any
of the parties hereto shall bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or not.
Notwithstanding the foregoing or anything to the contrary herein, the parties
may not assign this Agreement.
(B) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(C) COUNTERPARTS. This Agreement may be executed in counterparts, all of
which taken together shall constitute one and the same Agreement.
(D) GOVERNING LAW. This Agreement shall be deemed to be a contract made
under the laws of the State of New York and for all purposes shall be construed
in accordance with the internal laws of said State. The parties agree that, all
actions and proceedings arising out of this Agreement or any of the transactions
contemplated hereby, shall be brought in the United States District Court for
the Southern District of New York or in a New York State Court in the County of
New York and that, in connection with any such action or proceeding, submit to
the jurisdiction of, and venue in, such court. Each of the parties hereto also
irrevocably waives all right to trial by jury in any action, proceeding or
counterclaim arising out of this Agreement or the transactions contemplated
hereby.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first written above.
XXXXXXX XXXXXXX
By:
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Xxxxxx X. Xxxxxxxxxxxx, -----------------------------------
Chairman of the Board of
Directors, President and Chief
Executive Officer
XXXXXX XXXXX
SP ACQ LLC
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By:
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Xxxxxx X. Xxxxxxxxxxxx,
Managing Member XXXXXX X. XXXXXX
STEEL PARTNERS II, L.P. -----------------------------------
By: Steel Partners, L.L.C.
its General Partner
By: XXXXXXX XXXXXXXX
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Xxxxxx X. Xxxxxxxxxxxx
Managing Member -----------------------------------
S. XXXXXXXX XXXXXX
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