UNDERWRITING AGREEMENT between CAMDEN LEARNING CORPORATION and MORGAN JOSEPH & CO. INC. Dated: , 2007
EXHIBIT
1.1
between
CAMDEN
LEARNING CORPORATION
and
▇▇▇▇▇▇
▇▇▇▇▇▇ & CO. INC.
Dated:
, 2007
CAMDEN
LEARNING CORPORATION
,
2007
▇▇▇▇▇▇
▇▇▇▇▇▇ & Co. Inc.
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As
Representative of the
Several
Underwriters named in Schedule I hereto
Re:
Public Offering of Securities
Ladies
and Gentlemen:
The
undersigned, Camden Learning Corporation, a Delaware corporation (“ Company”),
hereby confirms its agreement with ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Inc. (“ ▇▇▇▇▇▇
▇▇▇▇▇▇ & Co.”
and
also referred to herein variously as “you,” or the “ Representative”)
and
with the other underwriters named on Schedule I hereto for which ▇▇▇▇▇▇ ▇▇▇▇▇▇
& Co. is acting as Representative (the Representative and the other
underwriters being collectively called the “ Underwriters”
or,
individually, an “ Underwriter”)
as
follows:
1.
Purchase
and Sale of Securities
.
1.1
Firm
Securities
.
1.1.1
Purchase
of Firm Units
. On the
basis of the representations and warranties herein contained, but subject to
the
terms and conditions herein set forth, the Company agrees to issue and sell,
severally and not jointly, to the several Underwriters, an aggregate of
4,500,000 units (“ Firm
Units”)
of the
Company, at a purchase price (net of discounts and commissions) of $7.44 per
Firm Unit. The Underwriters, severally and not jointly, agree to purchase from
the Company the number of Firm Units set forth opposite their respective names
on Schedule I attached hereto and made a part hereof at a purchase price (net
of
discounts and commissions) of $7.44 per Firm Unit. The Firm Units are to be
offered initially to the public (“ Offering”)
at the
offering price of $8.00 per Firm Unit. Each Firm Unit consists of one share
of
the Company’s common stock, par value $.0001 per share (“ Common
Stock”),
and
one warrant (“ Warrant”).
The
shares of Common Stock and the Warrants included in the Firm Units will not
be
separately transferable until 90 days after the effective date (“ Effective
Date”)
of the
Registration Statement (as defined in Section 2.1.1 hereof) unless the
Representative informs the Company, in writing, of its decision to allow earlier
separate trading based on its assessment of the relative strengths of the
securities markets and small capitalization companies in general, and the
trading pattern of, and demand for, the Company’s securities in particular, but
in no event will the Representative allow separate trading until the business
day after (i) the Company has filed with the Securities and Exchange Commission
(the “ Commission”)
a
Current Report on Form 8-K which includes an audited balance sheet reflecting
the Company’s receipt of the proceeds of the Offering and the Private Placement
(as defined in Section 2.22.4), including any proceeds the Company receives
from
the exercise of the Over-allotment Option (as defined in Section 1.2.1), if
such
option is exercised prior to the filing of the Form 8-K, (ii) the Company has
filed with the Commission a Current Report on Form 8-K and issued a press
release announcing when such separate trading will begin, and (iii) the
expiration of the Over-allotment Option or its exercise in full. Each Warrant
entitles its holder to exercise it to purchase one share of Common Stock for
$6.00 during the period commencing on the later of the consummation by the
Company of its “Business Combination” or one year from the Effective Date of the
Registration Statement and terminating on the four-year anniversary of the
Effective Date. “ Business
Combination”
shall
mean any merger, capital stock exchange, asset acquisition or other similar
business combination consummated by the Company with one or more operating
businesses in the education industry (as described more fully in the
Registration Statement (as defined in Section 2.1.1 below)).
1.1.2
Payment
and Delivery
.
Delivery and payment for the Firm Units shall be made at 10:00 a.m., New York
City time, on the fourth Business Day (as defined below) following the effective
date of the Registration Statement or at such earlier time as shall be agreed
upon by the Representative and the Company at the offices of ▇▇▇▇▇▇▇▇▇ Will
& ▇▇▇▇▇ LLP (“ ▇▇▇▇▇▇▇▇▇”)
or at
such other place as shall be agreed upon by the Representative and the Company.
The hour and date of delivery and payment for the Firm Units are called “
Closing
Date
.”
Payment for the Firm Units shall be made on the Closing Date at the
Representative’s election by wire transfer in Federal (same day) funds or by
certified or bank cashier’s check(s) in New York Clearing House funds, payable
as follows: $34,830,000 of the proceeds received by the Company for the Firm
Units and the Placement Warrants (as defined in Section 2.22.4) and $720,000
of
the Deferred Fees (as defined in Section 1.1.3) shall be deposited (or with
respect to the $2,500,000 of the proceeds from the sale of the Placement
Warrants shall have been deposited on or prior to the date hereof) in the trust
account established by the Company for the benefit of the public stockholders
as
described in the Registration Statement (“ Trust
Account”)
pursuant to the terms of an Investment Management Trust Agreement (“
Trust
Agreement”)
between the Company and Continental Stock Transfer & Trust Company (“
CST”)
and
the remaining proceeds shall be paid (subject to Section 3.12 hereof) to the
order of the Company upon delivery to you of certificates (in form and substance
satisfactory to the Underwriters) representing the Firm Units (or through the
facilities of the Depository Trust Company (“ DTC”))
for
the account of the Underwriters. The Firm Units shall be registered in such
name
or names and in such authorized denominations as the Representative may request
in writing at least two full Business Days prior to the Closing Date. The
Company will permit the Representative to examine and package the Firm Units
for
delivery, at least one full Business Day prior to the Closing Date. The Company
shall not be obligated to sell or deliver the Firm Units except upon tender
of
payment by the Representative for all the Firm Units. “ Business
Day”
shall
mean any day other than a Saturday, a Sunday or a legal holiday or a day on
which banking institutions or trust companies are authorized or obligated by
law
to close in New York City.
1.1.3
Deferral
of a Portion of Underwriters’ Discount
. On the
Closing Date and, if applicable, on the Option Closing Date (as defined in
Section 1.2.2), ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. agrees to deposit into the Trust Account
a portion of the Underwriters’ discount equal to $0.16 per Unit in the Offering
and, if applicable, a portion of the discount equal to $0.16 per Option Unit
(as
defined in Section 1.2.1) (the “ Deferred
Fees”)
until
the earlier of the completion of a Business Combination or the liquidation
of
the Trust Account. Upon the consummation of a Business Combination, ▇▇▇▇▇▇
▇▇▇▇▇▇ & Co. shall promptly receive the Deferred Fees, but only with respect
to those units as to which the component shares have not been redeemed for
cash
by those stockholders who voted against the Business Combination and exercised
their redemption rights. In the event that the Company is unable to consummate
a
Business Combination and CST, the trustee of the Trust Account, commences
liquidation of the Trust Account, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. hereby agrees to the
following: (i) to forfeit any rights or claims to the Deferred Fees; and (ii)
that the Deferred Fees shall be distributed on a pro-rata basis among the
holders of the shares of Common Stock included in the Units sold in the Offering
along with any interest accrued thereon, net of taxes.
-2-
1.2
Over-Allotment
Option
.
1.2.1
Option
Units
. For
the purposes of covering any over-allotments in connection with the distribution
and sale of the Firm Units, the Underwriters are hereby granted, severally
and
not jointly, an option to purchase up to an additional 675,000 units from the
Company (“ Over-allotment
Option”).
Such
additional 675,000 units, the net proceeds of which will be deposited in the
Trust Account, are hereinafter referred to as “ Option
Units
.” The
Firm Units and the Option Units are hereinafter collectively referred to as
the
“ Units
,” and
the Units, the shares of Common Stock and the Warrants included in the Units
and
the shares of Common Stock issuable upon exercise of the Warrants are
hereinafter referred to collectively as the “ Public
Securities
.” The
purchase price to be paid for the Option Units will be the same price per Option
Unit as the price per Firm Unit set forth in Section 1.1.1 hereof.
1.2.2
Exercise
of Option
. The
Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised
by the Representative as to all (at any time) or any part (from time to time)
of
the Option Units within 45 days after the Effective Date. The Underwriters
will
not be under any obligation to purchase any Option Units prior to the exercise
of the Over-allotment Option. The Over-allotment Option granted hereby may
be
exercised by the giving of oral notice to the Company by the Representative,
which must be confirmed in writing by overnight mail or facsimile transmission
setting forth the number of Option Units to be purchased and the date and time
for delivery of and payment for the Option Units (the “ Option
Closing Date”),
which
will not be later than five full Business Days after the date of the notice
or
such other time and in such other manner as shall be agreed upon by the Company
and the Representative, at the offices of ▇▇▇▇▇▇▇▇▇ or at such other place
as
shall be agreed upon by the Company and the Representative. Upon exercise of
the
Over-allotment Option, the Company will become obligated to convey to the
Underwriters, and, subject to the terms and conditions set forth herein, the
Underwriters will become obligated to purchase, the number of Option Units
specified in such notice.
1.2.3
Payment
and Delivery
.
Payment for the Option Units shall be made on the Option Closing Date at the
Representative’s election by wire transfer in Federal (same day) funds or by
certified or bank cashier’s check(s) in New York Clearing House funds, payable
as follows: $7.44 per Option Unit, which includes $0.16 of Deferred Fees per
Option Unit, shall be deposited in the Trust Account pursuant to the Trust
Agreement and the remaining proceeds shall be paid (subject to Section 3.12
hereof) to the order of the Company upon delivery to you of certificates (in
form and substance satisfactory to the Underwriters) representing the Option
Units (or through the facilities of DTC) for the account of the Underwriters.
The certificates representing the Option Units to be delivered will be in such
denominations and registered in such names as the Representative requests not
less than two full Business Days prior to the Closing Date or the Option Closing
Date, as the case may be, and will be made available to the Representative
for
inspection, checking and packaging at the aforesaid office of the Company’s
transfer agent or correspondent not less than one full Business Day prior to
such Closing Date.
-3-
1.3
Representative’s
Purchase Option
.
1.3.1
Purchase
Option
. The
Company hereby agrees to issue and sell to the Representative (and/or its
designees) on the Effective Date an option (“ Representative’s
Purchase Option”)
for
the purchase of an aggregate of 450,000 units (“ Representative’s
Units”)
for an
aggregate purchase price of $100. Each of the Representative’s Units is
identical to the Firm Units including the warrants constituting the Units to
purchase Common Stock (sometimes referred to as the “ Representative’s
Warrants”).
The
Representative’s Purchase Option shall be exercisable, in whole or in part,
commencing on the later of the consummation of a Business Combination and one
year from the Effective Date and expiring on the five-year anniversary of the
Effective Date at an initial exercise price per Representative’s Unit of $8.80
(110% of the initial public offering price of a Unit) and may be exercised
on a
cashless basis. The Representative’s Purchase Option, the Representative’s
Units, the Common Stock contained within the Representative’s Units, the
Representative’s Warrants and the shares of Common Stock issuable upon exercise
of the Representative’s Warrants are hereinafter referred to collectively as the
“ Representative’s
Securities
.” The
Public Securities and the Representative’s Securities are hereinafter referred
to collectively as the “ Securities
.” The
Representative understands and agrees that there are significant restrictions
against transferring the Representative’s Securities during the first year after
the Effective Date, as set forth in Section 3 of the Representative’s Purchase
Option.
1.3.2
Payment
and Delivery
.
Delivery and payment for the Representative’s Purchase Option shall be made on
the Closing Date. The Company shall deliver to the Underwriters, upon payment
therefor, certificates for the Representative’s Purchase Option in the name or
names and in such authorized denominations as the Representative may
request.
2.
Representations
and Warranties of the Company
. The
Company represents and warrants to the Underwriters as follows:
2.1
Filing
of Registration Statement
.
2.1.1
Pursuant
to the Act
. The
Company has filed with the Commission a registration statement and an amendment
or amendments thereto, on Form S-1 (File No. 333-[________]), including any
related preliminary prospectus (“ Preliminary
Prospectus”),
for
the registration of the Securities under the Securities Act of 1933, as amended
(“ Act”),
which
registration statement and amendment or amendments have been prepared by the
Company in conformity with the requirements of the Act, and the rules and
regulations (the “ Regulations”)
of the
Commission under the Act. The conditions for use of Form S-1 to register the
Offering under the Act, as set forth in the General Instructions to such Form,
have been satisfied. Except as the context may otherwise require, such
registration statement, as amended, on file with the Commission at the time
the
registration statement becomes effective (including the prospectus, financial
statements, schedules, exhibits and all other documents filed as a part thereof
or incorporated therein and all information deemed to be a part thereof as
of
such time pursuant to Rule 430A of the Regulations), is hereinafter called
the “
Registration
Statement
,” and
the form of the final prospectus dated the Effective Date included in the
Registration Statement (or, if applicable, the form of final prospectus filed
by
the Company with the Commission pursuant to Rule 424 of the Regulations), is
hereinafter called the “ Prospectus
.” For
purposes of this Agreement, “ Time
of Sale
,” as
used in the Act, means 4:30 p.m. New York City time, on the date of this
Agreement. Prior to the Time of Sale, the Company prepared a preliminary
Prospectus, dated [_______], 2007, for distribution by the Underwriters (the
“
Sale
Preliminary Prospectus”).
If
the Company has filed, or is required pursuant to the terms hereof to file,
a
Registration Statement pursuant to Rule 462(b) under the Act registering
additional Securities of any type (a “ Rule
462(b) Registration Statement”),
then,
unless otherwise specified, any reference herein to the term “ Registration
Statement”
shall
be deemed to include such Rule 462(b) Registration Statement. Other than a
Rule
462(b) Registration Statement, which, if filed, becomes effective upon filing,
no other document with respect to the Registration Statement has heretofore
been
filed with the Commission. All of the Public Securities have been registered
for
public sale under the Act pursuant to the Registration Statement or, if any
Rule
462(b) Registration Statement is filed, will be duly registered for public
sale
under the Act with the filing of such Rule 462(b) Registration Statement. The
Registration Statement has been declared effective by the Commission on the
date
hereof. If, subsequent to the date of this Agreement, the Company or the
Representative has determined that at the Time of Sale the Sale Preliminary
Prospectus includes an untrue statement of a material fact or omitted a
statement of material fact necessary to make the statements therein not
misleading and have agreed to provide an opportunity to purchasers of the Firm
Units to terminate their old purchase contracts and enter into new purchase
contracts, then the Sale Preliminary Prospectus will be deemed to include any
additional information available to purchasers at the time of entry into the
first such new purchase contract.
-4-
2.1.2
Pursuant
to the Exchange Act
. The
Company has filed with the Commission a Form 8-A (File Number 000-[ ]) providing
for the registration under the Securities Exchange Act of 1934, as amended
(“
Exchange
Act”),
of
the Units, the Common Stock and the Warrants. The registration of the Units,
Common Stock and Warrants under the Exchange Act has been declared effective
by
the Commission on the date hereof.
2.2
No
Stop Orders, Etc
.
Neither the Commission nor, to the best of the Company’s knowledge, any state
regulatory authority has issued any order or threatened to issue any order
preventing or suspending the use of any Sale Preliminary Prospectus or
Prospectus or has instituted or, to the best of the Company’s knowledge,
threatened to institute any proceedings with respect to such an
order.
2.3
Disclosures
in Registration Statement
.
-5-
2.3.1
10b-5
Representation
. At the
time the Registration Statement became effective and at all times subsequent
thereto up to the Closing Date and the Option Closing Date, if any, the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
do
and will contain all material statements that are required to be stated therein
in accordance with the Act and the Regulations, and will in all material
respects conform to the requirements of the Act and the Regulations; and neither
the Registration Statement, the Sale Preliminary Prospectus nor the Prospectus,
nor any amendment or supplement thereto, on their respective dates, nor the
Sale
Preliminary Prospectus as of the Time of Sale (or such subsequent Time of Sale
pursuant to Section 2.1.1), does or will contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under
which they were made, not misleading. When any Preliminary Prospectus or the
Sale Preliminary Prospectus was first filed with the Commission (whether filed
as part of the Registration Statement for the registration of the Securities
or
any amendment thereto or pursuant to Rule 424(a) of the Regulations) and when
any amendment thereof or supplement thereto was first filed with the Commission,
such Preliminary Prospectus or the Sale Preliminary Prospectus and any
amendments thereof and supplements thereto complied or will comply in all
material respects with the applicable provisions of the Act and the Regulations
and did not and will not contain an untrue statement of a material fact or
omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading. The representation and warranty made in this Section
2.3.1 does not apply to statements made or statements omitted in reliance upon
and in conformity with written information furnished to the Company with respect
to the Underwriters by the Representative expressly for use in the Registration
Statement, the Sale Preliminary Prospectus or the Prospectus or any amendment
thereof or supplement thereto.
2.3.2
Disclosure
of Agreements
. The
agreements and documents described in the Registration Statement, the Sale
Preliminary Prospectus and the Prospectus conform to the descriptions thereof
contained therein and there are no agreements or other documents required to
be
described in the Registration Statement, the Sale Preliminary Prospectus or
the
Prospectus or to be filed with the Commission as exhibits to the Registration
Statement, that have not been so described or filed. Each agreement or other
instrument (however characterized or described) to which the Company is a party
or by which its property or business is or may be bound or affected and (i)
that
is referred to in the Sale Preliminary Prospectus or the Prospectus, or (ii)
is
material to the Company’s business, has been duly and validly executed by the
Company, is in full force and effect and is enforceable against the Company
and,
to the Company’s knowledge, the other parties thereto, in accordance with its
terms, except (x) as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights
generally, (y) as enforceability of any indemnification or contribution
provision may be limited under the Federal and state securities laws, and (z)
that the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to the equitable defenses and to the discretion
of the court before which any proceeding therefor may be brought, and none
of
such agreements or instruments has been assigned by the Company, and neither
the
Company nor, to the best of the Company’s knowledge, any other party is in
breach or default thereunder and, to the best of the Company’s knowledge, no
event has occurred that, with the lapse of time or the giving of notice, or
both, would constitute a breach or default thereunder. To the best of the
Company’s knowledge, performance by the Company of the material provisions of
such agreements or instruments will not result in a violation of any existing
applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company
or
any of its assets or businesses, including, without limitation, those relating
to environmental laws and regulations.
-6-
2.3.3
Prior
Securities Transactions
. No
securities of the Company have been sold by the Company or by or on behalf
of,
or for the benefit of, any person or persons controlling, controlled by, or
under common control with the Company since the Company’s formation, except as
disclosed in the Registration Statement.
2.3.4
Regulations
. The
disclosures in the Registration Statement and the Sale Preliminary Prospectus
concerning the effects of Federal, State and local regulation on the Company’s
business as currently contemplated are correct in all material respects and
do
not omit to state a material fact necessary to make the statements therein,
in
light of the circumstances in which they were made, not misleading.
2.4
Changes
After Dates in Registration Statement
.
2.4.1
No
Material Adverse Change
. Since
the respective dates as of which information is given in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus, except as
otherwise specifically stated therein, (i) there has been no material adverse
change in the condition, financial or otherwise, or business prospects of the
Company, (ii) there have been no material transactions entered into by the
Company, other than as contemplated pursuant to this Agreement, and (iii) no
member of the Company’s management has resigned from any position with the
Company.
2.4.2
Recent
Securities Transactions; Etc
.
Subsequent to the respective dates as of which information is given in the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus,
and
except as may otherwise be indicated or contemplated herein or therein, the
Company has not (i) issued any securities or incurred any liability or
obligation, direct or contingent, for borrowed money; or (ii) declared or paid
any dividend or made any other distribution on or in respect to its equity
securities.
2.5
Independent
Accountants
. ▇▇▇▇▇▇
LLP (“ ▇▇▇▇▇▇”),
whose
report is filed with the Commission as part of the Registration Statement,
the
Sale Preliminary Prospectus and the Prospectus and included in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus, are independent
registered public accountants as required by the Act and the Regulations. ▇▇▇▇▇▇
has not, during the periods covered by the financial statements included in
the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus,
provided to the Company any non-audit services, as such term is used in Section
10A(g) of the Exchange Act.
2.6
Financial
Statements
. The
financial statements, including the notes thereto and supporting schedules
included in the Registration Statement, the Sale Preliminary Prospectus and
the
Prospectus fairly present the financial position, the results of operations
and
the cash flows of the Company at the dates and for the periods to which they
apply; such financial statements have been prepared in conformity with generally
accepted accounting principles, consistently applied throughout the periods
involved; and the supporting schedules included in the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus present fairly the
information required to be stated therein. The Registration Statement, the
Sale
Preliminary Prospectus and the Prospectus disclose all material off-balance
sheet transactions, arrangements, obligations (including contingent
obligations), and other relationships of the Company with unconsolidated
entities or other persons that may have a material current or future effect
on
the Company’s financial condition, changes in financial condition, results of
operations, liquidity, capital expenditures, capital resources, or significant
components of revenues or expenses. There are no financial statements
(historical or pro forma) that are required to be included in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus that are not
included as required.
-7-
2.7
Authorized
Capital; Options; Etc
. The
Company had at the date or dates indicated in the Sale Preliminary Prospectus
and the Prospectus duly authorized, issued and outstanding capitalization as
set
forth in the Registration Statement, the Sale Preliminary Prospectus, and the
Prospectus. Based on the assumptions stated in the Registration Statement,
the
Sale Preliminary Prospectus, and the Prospectus, the Company will have on the
Closing Date the adjusted stock capitalization set forth therein. Except as
set
forth in, or contemplated by the Registration Statement, the Sale Preliminary
Prospectus and the Prospectus, on the Effective Date and on the Closing Date,
there will be no options, warrants, or other rights to purchase or otherwise
acquire any authorized but unissued shares of Common Stock of the Company or
any
security convertible into shares of Common Stock of the Company, or any
contracts or commitments to issue or sell shares of Common Stock or any such
options, warrants, rights or convertible securities.
2.8
Valid
Issuance of Securities; Etc
.
2.8.1
Outstanding
Securities
. All
issued and outstanding securities of the Company (including, without limitation,
the Placement Warrants) have been duly authorized and validly issued and are
fully paid and non-assessable; the holders thereof have no rights of rescission
with respect thereto, and are not subject to personal liability by reason of
being such holders; and none of such securities were issued in violation of
the
preemptive rights of any holders of any security of the Company or similar
contractual rights granted by the Company. The authorized Common Stock and
Warrants conform in all material respects to all statements relating thereto
contained in the Registration Statement, the Sale Preliminary Prospectus and
the
Prospectus. The offers and sales of the outstanding securities of the Company
were at all relevant times either registered under the Act and the applicable
state securities or Blue Sky laws or exempt from such registration
requirements.
2.8.2
Securities
Sold Pursuant to this Agreement
. The
Securities have been duly authorized and, when issued and paid for, will be
validly issued, fully paid and non-assessable; the holders thereof are not
and
will not be subject to personal liability by reason of being such holders;
the
Securities are not and will not be subject to the preemptive rights of any
holders of any security of the Company or similar contractual rights granted
by
the Company; and all corporate action required to be taken for the
authorization, issuance and sale of the Securities has been duly and validly
taken. The form of certificates for the Securities conform to the corporate
law
of the jurisdiction of the Company’s incorporation. The Securities conform in
all material respects to all statements with respect thereto contained in the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus.
When
issued, the Representative’s Securities will constitute valid and binding
obligations of the Company to issue and sell, upon exercise thereof and payment
of the respective exercise prices therefor, the number and type of securities
of
the Company called for thereby in accordance with the terms thereof and such
Representative’s Securities are enforceable against the Company in accordance
with their respective terms, except (i) as such enforceability may be limited
by
bankruptcy, insolvency, reorganization or similar laws affecting creditors’
rights generally, (ii) as enforceability of any indemnification or contribution
provision may be limited under the Federal and state securities laws, and (iii)
that the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to the equitable defenses and to the discretion
of the court before which any proceeding therefor may be brought.
-8-
2.8.3
Placement
Warrants
. The
Placement Warrants (as defined in Section 2.22.4 hereof) constitute valid and
binding obligations of the Company to issue and sell, upon exercise thereof
and
payment of the respective exercise prices therefor, the number and type of
securities of the Company called for thereby in accordance with the terms
thereof, and such Placement Warrants are enforceable against the Company in
accordance with their respective terms, except: (i) as such enforceability
may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally; (ii) as enforceability of any indemnification or
contribution provision may be limited under federal and state securities laws;
and (iii) that the remedy of specific performance and injunctive and other
forms
of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
The
shares of Common Stock issuable upon exercise of the Placement Warrants have
been reserved for issuance upon the exercise of the Placement Warrants and,
when
issued in accordance with the terms of the Placement Warrants, will be duly
and
validly authorized, validly issued, fully paid and non-assessable, and the
holders thereof are not and will not be subject to personal liability by reason
of being such holders.
2.8.4
No
Integration
. Other
than with respect to the Placement Warrants, neither the Company nor any of
its
affiliates has, prior to the date hereof, made any offer or sale of any
securities which are required to be or may be “integrated” pursuant to the Act
or the Regulations with the offer and sale of the Securities pursuant to the
Registration Statement.
2.9
Registration
Rights of Third Parties
. Except
as set forth in the Sale Preliminary Prospectus and the Prospectus, no holders
of any securities of the Company or any rights exercisable for or convertible
or
exchangeable into securities of the Company have the right to require the
Company to register any such securities of the Company under the Act or to
include any such securities in a registration statement to be filed by the
Company.
2.10
Validity
and Binding Effect of Agreements
. This
Agreement, the Warrant Agreement (as defined in Section 2.21 hereof), the Trust
Agreement, the Services Agreement (as defined in Section 3.8.2 hereof), the
Escrow Agreement (as defined in Section 2.22.2 hereof) and the Subscription
Agreement (as defined in Section 2.22.4 hereof) have been duly and validly
authorized by the Company and constitute, and the Representative’s Purchase
Option, has been duly validly authorized by the Company and, when executed
and
delivered, 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,
reorganization or similar laws affecting creditors’ rights generally, (ii) as
enforceability of any indemnification or contribution provision may be limited
under the Federal and state securities laws, and (iii) that the remedy of
specific performance and injunctive and other forms of equitable relief may
be
subject to the equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought.
-9-
2.11
No
Conflicts, Etc
. The
execution, delivery, and performance by the Company of this Agreement, the
Warrant Agreement, the Representative’s Purchase Option, the Trust Agreement,
the Services Agreement, the Escrow Agreement and the Subscription Agreement,
the
consummation by the Company of the transactions herein and therein contemplated
and the compliance by the Company with the terms hereof and thereof do not
and
will not, with or without the giving of notice or the lapse of time or both
(i)
result in a breach of, or conflict with any of the terms and provisions of,
or
constitute a default under, or result in the creation, modification, termination
or imposition of any lien, charge or encumbrance upon any property or assets
of
the Company pursuant to the terms of any agreement or instrument to which the
Company is a party except pursuant to the Trust Agreement referred to in Section
2.23 hereof; (ii) result in any violation of the provisions of the Certificate
of Incorporation or the Bylaws of the Company; or (iii) violate any existing
applicable law, rule, regulation, judgment, order or decree of any governmental
agency or court, domestic or foreign, having jurisdiction over the Company
or
any of its properties or business.
2.12
No
Defaults; Violations
. No
material default exists in the due performance and observance of any term,
covenant or condition of any material license, contract, indenture, mortgage,
deed of trust, note, loan or credit agreement, or any other agreement or
instrument evidencing an obligation for borrowed money, or any other material
agreement or instrument to which the Company is a party or by which the Company
may be bound or to which any of the properties or assets of the Company is
subject. The Company is not in violation of any term or provision of its
Certificate of Incorporation or Bylaws or in violation of any material
franchise, license, permit, applicable law, rule, regulation, judgment or decree
of any governmental agency or court, domestic or foreign, having jurisdiction
over the Company or any of its properties or businesses.
2.13
Corporate
Power; Licenses; Consents
.
2.13.1
Conduct
of Business
. The
Company has all requisite corporate power and authority, and has all necessary
authorizations, approvals, orders, licenses, certificates and permits of and
from all governmental regulatory officials and bodies that it needs as of the
date hereof to conduct its business as described in the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus. The disclosures in the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
concerning the effects of Federal, state and local regulation on this Offering
and the Company’s business purpose as currently contemplated are correct in all
material respects and do not omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
-10-
2.13.2
Transactions
Contemplated Herein
. The
Company has all corporate power and authority to enter into this Agreement
and
to carry out the provisions and conditions hereof, and all consents,
authorizations, approvals and orders required in connection therewith have
been
obtained. No consent, authorization or order of, and no filing with, any court,
government agency or other body is required for the valid issuance, sale and
delivery, of the Securities and the consummation of the transactions and
agreements contemplated by this Agreement, the Warrant Agreement, the
Representative’s Purchase Option, the Trust Agreement, the Escrow Agreement and
the Subscription Agreement and as contemplated by the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus, except with respect to
applicable Federal and state securities laws and the rules and regulations
promulgated by the National Association of Securities Dealers, Inc. (“
NASD”).
2.14
D&O
Questionnaires
. To the
best of the Company’s knowledge, all information contained in the questionnaires
(“ Questionnaires”)
completed by each of the Company’s stockholders prior to the Offering (“
Existing
Stockholders”)
and
provided to the Representative is true and correct and the Company has not
become aware of any information which would cause the information disclosed
in
the questionnaires completed by each Existing Stockholder to become inaccurate
or incorrect.
2.15
Litigation;
Governmental Proceedings
. There
is no action, suit, proceeding, inquiry, arbitration, investigation, litigation
or governmental proceeding pending or, to the best of the Company’s knowledge,
threatened against, or involving the Company or, to the best of the Company’s
knowledge, any Existing Stockholder which has not been disclosed, that is
required to be disclosed, in the Registration Statement, the Sale Preliminary
Prospectus, the Prospectus or the Questionnaires.
2.16
Good
Standing
. The
Company has been duly organized and is validly existing as a corporation and
is
in good standing under the laws of its state of incorporation, and is duly
qualified to do business and is in good standing as a foreign corporation in
each jurisdiction in which its ownership or lease of property or the conduct
of
business requires such qualification, except where the failure to qualify would
not have a material adverse effect on the assets, business or operations of
the
Company.
2.17
Stop
Orders
. The
Commission has not issued any order preventing or suspending the use of the
Registration Statement, any Preliminary Prospectus, the Sale Preliminary
Prospectus or the Prospectus or any part thereof and has not threatened to
issue
any such order.
2.18
Transactions
Affecting Disclosure to NASD
.
2.18.1
Finder’s
Fees
. 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
Existing Stockholder with respect to the sale of the Securities hereunder or
any
other arrangements, agreements or understandings of the Company or any Existing
Stockholder that may affect the Underwriters’ compensation, as determined by the
NASD.
-11-
2.18.2
Payments
Within Twelve Months
. The
Company has not made any direct or indirect payments (in cash, securities or
otherwise) (i) to any person, as a finder’s fee, consulting fee or otherwise, in
consideration of such person raising capital for the Company or introducing
to
the Company persons who raised or provided capital to the Company, (ii) to
any
NASD member or (iii) to any person or entity that has any direct or indirect
affiliation or association with any NASD member, within the twelve months prior
to the Effective Date, other than payments to the Representative in connection
with the Offering.
2.18.3
Use
of
Proceeds
. None
of the net proceeds of the Offering and Private Placement will be paid by the
Company to any participating NASD member or its affiliates, except as
specifically authorized herein and except as may be paid in connection with
a
Business Combination as contemplated by the Sale Preliminary
Prospectus.
2.18.4
Insiders’
NASD Affiliation
. No
officer, director or any beneficial owner of the Company’s unregistered
securities has any direct or indirect affiliation or association with any NASD
member, as determined in accordance with the rules and regulations of the NASD.
The Company will advise the Representative and its counsel if it learns that
any
officer, director or owner of at least 5% of the Company’s outstanding Common
Stock is or becomes an affiliate or associated person of an NASD member
participating in the Offering.
2.19
Foreign
Corrupt Practices Act; Patriot Act
.
2.19.1
Foreign
Corrupt Practices Act
.
Neither the Company nor any of the Existing Stockholders or any other person
acting on behalf of the Company has, directly or indirectly, given or agreed
to
give any money, gift or similar benefit (other than legal price concessions
to
customers in the ordinary course of business) to any customer, supplier,
employee or agent of a customer or supplier, or official or employee of any
governmental agency or instrumentality of any government (domestic or foreign)
or any political party or candidate for office (domestic or foreign) or any
political party or candidate for office (domestic or foreign) or other person
who was, is, or may be in a position to help or hinder the business of the
Company (or assist it in connection with any actual or proposed transaction)
that (i) might subject the Company to any damage or penalty in any civil,
criminal or governmental litigation or proceeding, (ii) if not given in the
past, might have had a material adverse effect on the assets, business or
operations of the Company as reflected in any of the financial statements
contained in the Prospectus or (iii) if not continued in the future, might
adversely affect the assets, business, operations or prospects of the Company.
The Company’s internal accounting controls and procedures are sufficient to
cause the Company to comply with the Foreign Corrupt Practices Act of 1977,
as
amended.
2.19.2
Patriot
Act
.
Neither the Company nor any Company affiliates have violated: (i) the Bank
Secrecy Act, as amended, (ii) the Money Laundering Control Act of 1986, as
amended, or (iii) the Uniting and Strengthening of America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT
ACT)
Act of 2001, and/or the rules and regulations promulgated under any such law,
or
any successor law.
-12-
2.20
Officers’
Certificate
. Any
certificate signed by any duly authorized officer of the Company and delivered
to you or to your counsel shall be deemed a representation and warranty by
the
Company to the Underwriters as to the matters covered thereby.
2.21
Warrant
Agreement
. The
Company has entered into a warrant agreement with respect to the Warrants and
the Representative’s Warrants with CST substantially in the form annexed as
Exhibit 4.4 to the Registration Statement (“ Warrant
Agreement”).
2.22
Agreements
With Existing Stockholders
.
2.22.1
Insider
Letters
. The
Company has caused to be duly executed legally binding and enforceable
agreements (except (i) as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights
generally, (ii) as enforceability of any indemnification, contribution or
noncompete provision may be limited under the Federal and state securities
laws,
and (iii) that the remedy of specific performance and injunctive and other
forms
of equitable relief may be subject to the equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought)
annexed as Exhibits 10.1.1-10.1.8 to the Registration Statement (“ Insider
Letters”),
pursuant to which each of the Existing Stockholders of the Company agree to
certain matters, including but not limited to, certain matters described as
being agreed to by them under the “ Proposed
Business”
section
of the Sale Preliminary Prospectus and the Prospectus.
2.22.2
Escrow
Agreement
. The
Company has caused the Existing Stockholders to enter into an escrow agreement
(“ Escrow
Agreement”)
with
CST (“ Escrow
Agent”),
substantially in the form annexed as Exhibit 10.3 to the Registration Statement,
whereby (i) the Common Stock owned by the Existing Stockholders (the “Existing
Stockholders Shares”) will be held in escrow by the Escrow Agent, until one year
from the date of consummation of a Business Combination and (ii) the Placement
Warrants will be held in escrow by the Escrow Agent until such time that the
Company consummates a Business Combination; provided, however, that if the
Escrow Agent is notified by the Company that the Company is being liquidated
at
any time during the applicable Escrow Period (as that term is defined in the
Escrow Agreement), then immediately prior to the effectiveness of such
liquidation, the Escrow Agent shall promptly destroy the certificates
representing the Existing Stockholders Shares and the Placement Warrants. During
such escrow period, the Existing Stockholders shall be prohibited from selling
or otherwise transferring such shares (except to spouses and children of
Existing Stockholders and trusts established for their benefit and as otherwise
set forth in the Escrow Agreement) but will retain the right to vote such
shares. To the Company’s knowledge, the Escrow Agreement is enforceable against
each of the Existing Stockholders and will not, with or without the giving
of
notice or the lapse of time or both, result in a breach of, or conflict with
any
of the terms and provisions of, or constitute a default under, any agreement
or
instrument to which any of the Existing Stockholders is a party. The Escrow
Agreement shall not be amended, modified or otherwise changed without the prior
written consent of the Representative.
2.22.3
No
Fiduciary Relationship in Pricing
. The
Company acknowledges and agrees that (i) the purchase and sale of the Units
pursuant to this Agreement is an arm’s-length commercial transaction between the
Company and the several Underwriters, (ii) in connection therewith and with
the
process leading to such transaction, each Underwriter is acting solely as a
principal and not the agent or fiduciary of the Company, (iii) no Underwriter
has assumed an advisory or fiduciary responsibility in favor of the Company
with
respect to the offering contemplated hereby or the process leading thereto
(irrespective of whether such Underwriter has advised or is currently advising
the Company on other matters) or any other obligation to the Company except
the
obligations expressly set forth in this Agreement and (iv) the Company has
consulted its own legal and financial advisors to the extent it deemed
appropriate. The Company agrees that it will not claim that the Underwriters,
or
any of them, has rendered advisory services of any nature or respect, or owes
a
fiduciary or similar duty to the Company, in connection with such transaction
or
the process leading thereto.
-13-
2.22.4
Founding
Warrant Purchase Agreement
. Camden
Learning, LLC, a limited liability company owned by two investment limited
partnerships which are indirectly controlled by and partially owned by certain
of our officers and directors (the “ Sponsor”)
executed and delivered an agreement, annexed as Exhibit 10.6 of the Registration
Statement (the “ Subscription
Agreement”),
pursuant to which such persons, among other things, have purchased an aggregate
of 2,500,000 warrants identical to the Warrants (the “ Placement
Warrants”)
at a
purchase price of $1.00 per Placement Warrant in a private placement in
accordance with Regulation D under the Act occurring immediately prior to the
Closing (the “ Private
Placement”).
The
Sponsor and the Company have delivered executed copies of the Subscription
Agreement and the Sponsor has delivered the purchase price on or before the
Effective Date. Pursuant to the Subscription Agreement, (i) $2,500,000 of the
proceeds from the sale of the Placement Warrants will be deposited by the
Company in the Trust Account in accordance with the terms of the Trust Agreement
prior to the Effective Date, and (ii) the purchasers of the Placement Warrants
have waived any and all rights and claims that they may have to any proceeds,
and any interest thereon, held in the Trust Account in respect of the Placement
Warrants in the event that a Business Combination is not consummated and the
Trust Account is liquidated in accordance with the terms of the Trust
Agreement.
2.23
Investment
Management Trust Agreement
. The
Company has entered into the Trust Agreement with respect to certain proceeds
of
the Offering substantially in the form annexed as Exhibit 10.2 to the
Registration Statement.
2.24
No
Existing Non-Competition Agreements
. No
Existing Stockholder, employee, officer or director of the Company is subject
to
any non-competition agreement or non-solicitation agreement with any employer
or
prior employer which could materially affect his ability to be an Existing
Stockholder, employee, officer and/or director of the Company.
2.25
Investments
. The
Company is not and, after giving effect to the Offering and sale of the
Securities and the application of the proceeds thereof as described in the
Sale
Preliminary Prospectus and the Prospectus, will not be an “investment company”
as defined in the Investment Company Act of 1940, as amended.
2.26
Subsidiaries
. The
Company does not own an interest in any corporation, partnership, limited
liability company, joint venture, trust or other business entity.
-14-
2.27
Related
Party Transactions
. There
are no business relationships or related party transactions involving the
Company or any other person required to be described in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus that have not
been
described as required.
2.28
Data
. The
statistical, industry-related and market-related data included in the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
are
based on or derived from sources which the Company reasonably and in good faith
believes are reliable and accurate, and such data agree with the sources from
which they are derived.
2.29
Business
Combinations
. The
Company does not have any specific Business Combination under consideration
or
contemplation and the Company has not (nor has anyone on its behalf) contacted
any potential target business or had any discussions, formal or otherwise,
with
respect to such a transaction.
2.30
Distribution
of Offering Material By the Company
. The
Company has not distributed and will not distribute, prior to the later of
the
Closing Date and the completion of the Underwriters’ distribution of the Units,
any offering material in connection with the offering and sale of the Units
other than the Sale Preliminary Prospectus and the Prospectus, in each case
as
supplemented and amended.
2.31
No
Transfer Taxes
. There
are no transfer taxes or other similar fees or charges under federal law or
the
laws of any state, or any political subdivision thereof, required to be paid
in
connection with the execution and delivery of this Agreement or the issuance
by
the Company or sale by the Company of the Units.
2.32
Tax
Law Compliance
. The
Company has filed all necessary federal, state, local and foreign income and
franchise tax returns in a timely manner and has paid all taxes required to
be
paid by the Company and, if due and payable, any related or similar assessment,
fine or penalty levied against the Company, except for any taxes, assessments,
fines or penalties as may be being contested in good faith and by appropriate
proceedings. The Company has made appropriate provisions in the applicable
financial statements referred to in Section 2.6 above in respect of all federal,
state, local and foreign income and franchise taxes for all current or prior
periods as to which the tax liability of the Company has not been finally
determined.
2.33
Insurance
. The
Company is insured with policies in such amounts and with such deductibles
and
covering such risks as are generally deemed adequate and customary for its
business. All policies of insurance and fidelity or surety bonds insuring the
Company or its businesses, assets, employees, officers and directors are in
full
force and effect; the Company is in compliance with the terms of such policies
and instruments in all material respects; and there are no claims by the Company
under any such policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; and the Company
has
not been refused any insurance coverage sought or applied for. The Company
has
no reason to believe that it will not be able (i) to renew its existing
insurance coverage as and when such policies expire or (ii) to obtain comparable
coverage from similar institutions as may be necessary or appropriate to conduct
its business as now conducted and at a cost that would not have a material
adverse effect.
-15-
2.34
Ineligible
Issuer
. At the
time of filing the Registration Statement and at the date hereof, the Company
was and is an “ineligible issuer,” as defined in Rule 405 under the Securities
Act. The Company has not made any offer relating to the Securities that would
constitute an “issuer free writing Prospectus,” as defined in Rule 433, or that
would otherwise constitute a “free writing Prospectus,” as defined in Rule
405.
2.35
Standard
& Poor’s Application
. Prior
to the date hereof, the Company has made application with Standard & Poor’s
to have information regarding the Company and the Securities included in the
Standard & Poor’s Daily News and Corporations Records Description so as to
allow for secondary trading of the Public Securities in the state jurisdictions
which allow for an exemption for non-issuer secondary trading.
3.
Covenants
of the Company
. The
Company covenants and agrees as follows:
3.1
Amendments
to Registration Statement
. The
Company will deliver to the Representative, prior to filing, any amendment
or
supplement to the Registration Statement or Prospectus proposed to be filed
after the Effective Date and the Company shall not file any such amendment
or
supplement to which the Representative shall reasonably object.
3.2
Federal
Securities Laws
.
3.2.1
Compliance
. During
the time when a Prospectus is required to be delivered under the Act, the
Company will use all reasonable efforts to comply with all requirements imposed
upon it by the Act, the Regulations and the Exchange Act and by the regulations
under the Exchange Act, as from time to time in force, so far as necessary
to
permit the continuance of sales of or dealings in the Securities in accordance
with the provisions hereof and the Prospectus. If at any time when a Sale
Preliminary Prospectus or Prospectus relating to the Securities is required
to
be delivered under the Act, any event shall have occurred as a result of which,
in the opinion of counsel for the Company or counsel for the Underwriters,
the
Sale Preliminary Prospectus or the Prospectus, as then amended or supplemented,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading, or
if
it is necessary at any time to amend the Sale Preliminary Prospectus or the
Prospectus to comply with the Act, the Company will notify the Representative
promptly and prepare and file with the Commission, subject to Section 3.1
hereof, an appropriate amendment or supplement in accordance with Section 10
of
the Act.
3.2.2
Filing
of Final Prospectus
. The
Company will file the Prospectus (in form and substance satisfactory to the
Representative) with the Commission pursuant to the requirements of Rule 424
of
the Regulations.
3.2.3
Exchange
Act Registration
. The
Company will use its best efforts to maintain the registration of the Securities
under the provisions of the Exchange Act (except in connection with a
going-private transaction) for a period of five years from the Effective Date,
or until the Company is required to be liquidated if earlier, or, in the case
of
the Warrants, until the Warrants expire and are no longer exercisable. The
Company will not deregister the Securities under the Exchange Act without the
prior written consent of the Representative.
-16-
3.3
Ineligible
Issuer
. The
Company will not make any offer relating to the Securities that would constitute
an “issuer free writing Prospectus,” as defined in Rule 433, or that would
otherwise constitute a “free writing Prospectus,” as defined in Rule
405.
3.4
Blue
Sky Filing
. The
Company will endeavor in good faith, in cooperation with the Representative,
at
or prior to the time the Registration Statement becomes effective, to qualify
the Securities for offering and sale under the securities laws of such
jurisdictions as the Representative may reasonably designate, provided that
no
such qualification shall be required in any jurisdiction where, as a result
thereof, the Company would be subject to service of general process or to
taxation as a foreign corporation doing business in such jurisdiction. In each
jurisdiction where such qualification shall be effected, the Company will,
unless the Representative agrees that such action is not at the time necessary
or advisable, use all reasonable efforts to file and make such statements or
reports at such times as are or may be required by the laws of such
jurisdiction. The Company shall pay all filings fees in connection with the
qualification of the securities under the securities laws of such jurisdictions
as the Representative may reasonably designate.
3.5
Delivery
to Underwriters of Preliminary Prospectus, Sale Preliminary Prospectus and
Prospectuses
. The
Company will deliver to each of the several Underwriters, without charge, from
time to time during the period when the Prospectus is required to be delivered
under the Act or the Exchange Act such number of copies of each Preliminary
Prospectus, Sale Preliminary Prospectus and Prospectus as such Underwriters
may
reasonably request and, as soon as the Registration Statement or any amendment
or supplement thereto becomes effective, deliver to you two original executed
Registration Statements, including exhibits, and all post-effective amendments
thereto and copies of all exhibits filed therewith or incorporated therein
by
reference and a copy of all original executed consents of certified
experts.
3.6
Effectiveness
and Events Requiring Notice to the Representative
. The
Company will use its best efforts to cause the Registration Statement to remain
effective and will notify the Representative immediately and confirm the notice
in writing (i) of the effectiveness of the Registration Statement and any
amendment thereto, (ii) of the issuance by the Commission of any stop order
or
of the initiation, or the threatening, of any proceeding for that purpose,
(iii)
of the issuance by any state securities commission of any proceedings for the
suspension of the qualification of the Public Securities for offering or sale
in
any jurisdiction or of the initiation, or the threatening, of any proceeding
for
that purpose, (iv) of the mailing and delivery to the Commission for filing
of
any amendment or supplement to the Registration Statement or Prospectus, (v)
of
the receipt of any comments or request for any additional information from
the
Commission, and (vi) of the happening of any event during the period described
in Section 3.2.3 hereof that, in the judgment of the Company or its counsel,
makes any statement of a material fact made in the Registration Statement,
the
Sale Preliminary Prospectus or the Prospectus untrue or that requires the making
of any changes in the Registration Statement, the Sale Preliminary Prospectus
or
the Prospectus in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. If the Commission
or
any state securities commission shall enter a stop order or suspend such
qualification at any time, the Company will make every reasonable effort to
obtain promptly the lifting of such order.
-17-
3.7
Review
of Quarterly Financial Statements
. Until
the earlier of five years from the Effective Date, or until such earlier time
upon which the Company is required to be liquidated, the Company, at its
expense, shall cause its regularly engaged independent 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, the filing of the Company’s Form 10-Q quarterly report
and the mailing of quarterly financial information to stockholders.
3.8
Affiliated
Transactions
.
3.8.1
Business
Combinations
. The
Company will not consummate a Business Combination with any entity that
is a
portfolio company of, or otherwise affiliated with, or has received financial
investment from, any of the private equity firms with which the Company’s
Existing Stockholders, executive officers or directors are
affiliated.
No
Existing Stockholder or any affiliate of such person shall receive any fees
of
any type (other than reimbursement of ordinary and customary expenses incurred
on behalf of the Company) in connection with any Business
Combination.
3.8.2
Administrative
Services
. The
Company has entered into an agreement (“ Services
Agreement”)
with
the Sponsor (“ Affiliate”)
substantially in the form annexed as Exhibit 10.5 to the Registration Statement
pursuant to which the Affiliate will make available to the Company general
and
administrative, including office space, utilities, administrative services,
technology and secretarial services for the Company’s use for up to $7,500 per
month.
3.8.3
Compensation
to Existing Stockholders
. Except
as set forth above in this Section 3.8, the Company shall not pay any Existing
Stockholder or any of their affiliates any fees or compensation from the
Company, for services rendered to the Company prior to, or in connection with,
the consummation of a Business Combination; provided that the Existing
Stockholders shall be entitled to reimbursement from the Company for their
reasonable out-of-pocket expenses incurred in connection with seeking and
consummating a Business Combination.
3.9
Financial
Public Relations Firm
.
Promptly after the execution of a definitive agreement for a Business
Combination, the Company shall retain a financial public relations firm
reasonably acceptable to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. for a term to be agreed on by
the Company and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co.
3.10
Reports
to the Representative
.
3.10.1
Periodic
Reports, Etc
. For a
period of five years from the Effective Date or until such earlier time upon
which the Company is required to be liquidated, the Company will furnish to
the
Representative (▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. Attn: ▇▇▇▇ ▇▇▇▇▇▇) and its counsel
copies of such financial statements and other periodic and special reports
as
the Company from time to time furnishes generally to holders of any class of
its
securities, and promptly furnish to the Representative (i) a copy of each
periodic report the Company shall be required to file with the Commission,
(ii)
a copy of every press release and every news item and article with respect
to
the Company or its affairs which was released by the Company, (iii) a copy
of
each Form 8-K or Schedules 13D, 13G, 14D-1 or 13E-4 received or prepared by
the
Company, (iv) two (2) copies of each registration statement filed by the Company
with the Commission under the Securities Act, (v) a copy of monthly statements,
if any, setting forth such information regarding the Company’s results of
operations and financial position (including balance sheet, profit and loss
statements and data regarding outstanding purchase orders) as is regularly
prepared by management of the Company and (vi) such additional documents and
information with respect to the Company and the affairs of any future
subsidiaries of the Company as the Representative may from time to time
reasonably request. Documents filed with the Commission pursuant to its ▇▇▇▇▇
system shall be deemed to have been delivered to the Representative pursuant
to
this Section.
-18-
3.10.2
Transfer
Sheets
. For a
period of two years following the Effective Date or until such earlier time
upon
which the Company is required to be liquidated, the Company shall retain CST
or
another transfer and warrant agent acceptable to the Representative (“
Transfer
Agent”)
and
will furnish to the Underwriters at the Company’s sole cost and expense, for a
period of one year following the Effective Date, such transfer sheets of the
Company’s securities as the Representative may request, including the daily and
monthly consolidated transfer sheets of the Transfer Agent and DTC. The
Underwriters acknowledge that CST is an acceptable Transfer Agent.
3.10.3
Secondary
Market Trading Maintenance
. Unless
the Securities are listed or quoted, as the case may be, on the New York Stock
Exchange, the American Stock Exchange or quoted on the NASDAQ Global Market
or
NASDAQ Capital Market, until such earlier time upon which the Company is
required to be liquidated or five years from the date hereof, the Company shall
maintain its listing in Standards & Poor’s Daily News and Corporation
Records Corporate Descriptions at its cost and expense and on the date hereof
and at the beginning of each fiscal quarter, shall provide the Representative
with a written report of counsel detailing those states in which the Securities
may be traded in non-issuer transactions under the Blue Sky laws of the fifty
States.
3.10.4
Trading
Reports
. During
such time as any of the Securities are quoted on the NASD OTC Bulletin Board
(or
any successor trading market such as the Bulletin Board Exchange) or the Pink
Sheets, LLC (or similar publisher of quotations) and no other automated
quotation system, the Company shall provide to the Representative, at its
expense, such reports published by the NASD or the Pink Sheets, LLC relating
to
price trading of the Securities, as the Representative shall reasonably
request.
3.11
Disqualification
of Form S-1
. Until
the earlier of seven years from the date hereof or until the Warrants have
expired and are no longer exercisable, the Company will not take any action
or
actions which may prevent or disqualify the Company’s use of Form S-1 (or other
appropriate form) for the registration of the Warrants and the Representative’s
Warrants under the Act (except in connection with a going-private
transaction).
-19-
3.12
Payment
of Expenses
.
3.12.1
General
Expenses Related to the Offering
. The
Company hereby agrees to pay on each of the Closing Date and the Option Closing
Date, if any, to the extent not paid at Closing Date, all expenses incident
to
the performance of the obligations of the Company under this Agreement,
including but not limited to (i) the preparation, printing, filing and mailing
(including the payment of postage with respect to such mailing) of the
Registration Statement, the Preliminary, the Preliminary Sale and Final
Prospectuses and the printing and mailing of this Agreement and related
documents, including the cost of all copies thereof and any amendments thereof
or supplements thereto supplied to the Underwriters in quantities as may be
required by the Underwriters, (ii) the printing, engraving, issuance and
delivery of the Units, the shares of Common Stock and the Warrants included
in
the Units and the Representative’s Purchase Option, including any transfer or
other taxes payable thereon, (iii) filing fees, costs and expenses (including
disbursements for the Representative’s counsel) incurred in registering the
Offering with the NASD and qualifying the Public Securities under state or
foreign securities or Blue Sky laws, (iv) fees, costs and expenses incurred
in
listing the Company on the Over the Counter Bulletin Board, (v) fees and
disbursements of the transfer and warrant agent, (vi) the Company’s expenses
associated with “due diligence” and “road show” meetings arranged by the
Representative, (vii) the preparation, binding and delivery of transaction
“bibles,” in form and style reasonably satisfactory to the Representative and
transaction lucite cubes or similar commemorative items in a style and quantity
as reasonably requested by the Representative and (viii) all other costs and
expenses customarily borne by an issuer incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in
this
Section 3.12.1. The Company also agrees that, if requested by the
Representative, it will engage and pay up to $5,000 for an investigative search
firm of the Representative’s choice to conduct an investigation of the
principals of the Company as shall be mutually selected by the Representative
and the Company. The Representative may deduct from the net proceeds of the
Offering payable to the Company on the Closing Date, or the Option Closing
Date,
if any, the expenses set forth in this Agreement to be paid by the Company
to
the Representative and others. If the Offering contemplated by this Agreement
is
not consummated for any reason whatsoever then the Company shall reimburse
the
Underwriters in full for their out of pocket expenses, including, without
limitation, its legal fees (up to a maximum of $[--------------________]
) and
disbursements and “road show” and due diligence expenses.
3.12.2
Expenses
Related to Business Combination
. The
Company further agrees that, in the event the Representative assists the Company
in trying to obtain stockholder approval of a proposed Business Combination,
the
Company agrees to reimburse the Representative for all reasonable out-of-pocket
expenses, including, but not limited to, “road-show” and due diligence
expenses.
3.13
Application
of Net Proceeds
. The
Company will apply the net proceeds from the Offering and Private Placement
received by it in a manner consistent with the application described under
the
caption “Use of Proceeds” in the Registration Statement, the Sale Preliminary
Prospectus and the Prospectus.
3.14
Delivery
of Earnings Statements to Security Holders
. The
Company will make generally available to its security holders as soon as
practicable, but not later than the first day of the fifteenth full calendar
month following the Effective Date, an earnings statement (which need not be
certified by independent public or independent certified public accountants
unless required by the Act or the Regulations, but which shall satisfy the
provisions of Rule 158(a) under Section 11(a) of the Act) covering a period
of
at least twelve consecutive months beginning after the Effective
Date.
-20-
3.15
Notice
to NASD
. In the
event any person or entity (regardless of any NASD affiliation or association)
is engaged to assist the Company in its search for a merger candidate or to
provide any other merger and acquisition services, the Company will provide
the
following to the NASD and to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. prior to the consummation
of the Business Combination: (i) complete details of all services and copies
of
agreements governing such services; and (ii) justification as to why the person
or entity providing the merger and acquisition services should not be considered
an “underwriter and related person” with respect to the Company’s initial public
offering, as such term is defined in Rule 2710 of the NASD’s Conduct Rules. The
Company also agrees that proper disclosure of such arrangement or potential
arrangement will be made in the proxy statement which the Company will file
for
purposes of soliciting stockholder approval for the Business
Combination.
3.16
Stabilization
.
Neither the Company, nor, to its knowledge, any of its employees, directors
or
stockholders (without the consent of the Representative) has taken or will
take,
directly or indirectly, any action designed to or that has constituted or that
might reasonably be expected to cause or result in, under the Exchange Act,
or
otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
3.17
Existing
Lock-Up Agreement
. The
Company will enforce all existing agreements between the Company and any of
its
security holders that prohibit the sale, transfer, assignment, pledge or
hypothecation of any of the Securities in connection with the IPO. In addition,
the Company will direct the Transfer Agent to place stop transfer restrictions
upon any such Securities of the Company that are bound by such existing
“lock-up” agreements for the duration of the periods contemplated in such
agreements.
3.18
Internal
Controls
. 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.
-21-
3.19
Accountants
. Until
the earlier of five years from the Effective Date or until such earlier time
upon which the Company is required to be liquidated, the Company shall retain
▇▇▇▇▇▇ or another independent registered public accounting firm reasonably
acceptable to the Representative.
3.20
Form
8-K
. The
Company shall, on the date hereof, retain its independent registered public
accounting firm to audit the financial statements of the Company as of the
Closing Date (“ Audited
Financial Statements”)
reflecting the receipt by the Company of the proceeds of the Offering. As soon
as the Audited Financial Statements become available, the Company shall
immediately file a Current Report on Form 8-K with the Commission, which Report
shall contain the Company’s Audited Financial Statements.
3.21
Notice
to NASD
. For a
period of ninety days after the date of the Prospectus, in the event any person
or entity (regardless of any NASD affiliation or association but excluding
attorneys, accountants, engineers, environmental or labor consultants,
investigatory firms, technology consultants and specialists and similar service
providers that are not affiliated with or associated with the NASD and are
not
brokers or finders) is engaged, in writing, to assist the Company in its search
for a target business or to provide any other services in connection therewith,
the Company will provide the following to the NASD and the Representative prior
to the consummation of the Business Combination: (i) complete details of all
services and copies of agreements governing such services (which may be
appropriately redacted to account for privilege or confidentiality concerns);
and (ii) justification as to why the person or entity providing the merger
and
acquisition services should not be considered an “underwriter and related
person” with respect to the IPO, as such term is defined in Rule 2710 of the
NASD’s Conduct Rules. The Company also agrees that, if required by law, 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.
3.22
NASD
. The
Company shall advise the NASD if it is aware that any 5% or greater stockholder
of the Company becomes an affiliate or associated person of an NASD member
participating in the distribution of the Company’s Public
Securities.
3.23
Corporate
Proceedings
. All
corporate proceedings and other legal matters necessary to carry out the
provisions of this Agreement and the transactions contemplated hereby shall
done
to the reasonable satisfaction to counsel for the Underwriters.
3.24
Investment
Company
. The
Company shall cause the proceeds of the Offering to be held in the Trust Account
to be invested only in “government securities” with specific maturity dates or
in money market funds as set forth in the Trust Agreement and disclosed in
the
Registration Statement, Sale, Preliminary Prospectus or Prospectus. The Company
will otherwise conduct its business in a manner so that it will not become
subject to the Investment Company Act of 1940, as amended. Furthermore, once
the
Company consummates a Business Combination, it will be engaged in a business
other than that of investing, reinvesting, owning, holding or trading
securities.
3.25
Business
Combination Announcement
. Within
five Business Days following the consummation by the Company of a Business
Combination, the Company shall cause an announcement (“ Business
Combination Announcement”)
to be
placed, at its cost, in The Wall Street Journal, the New York Times and a third
publication to be selected by the Representative announcing the consummation
of
the Business Combination and indicating that the Representative was the managing
underwriter in the Offering. The Company shall supply the Representative with
a
draft of the Business Combination Announcement and provide the Representative
with a reasonable opportunity to comment thereon. The Company will not place
the
Business Combination Announcement without the final approval of the
Representative, which such approval will not be unreasonably
withheld.
-22-
3.26
Colorado
Trust Filing
. In the
event the Securities are registered in the State of Colorado, the Company will
cause a Colorado Form ES to be filed with the Commissioner of the State of
Colorado no less than 10 days prior to the distribution of the Trust Account
in
connection with a Business Combination and will do all things necessary to
comply with Section ▇▇-▇▇-▇▇▇ and Rule 51-3.4 of the Colorado Securities
Act.
3.27
10b5
-
1 Purchase Agreement
. The
Sponsor has entered into an agreement with the Representative, in accordance
with Rule 10b5 - 1 of the Exchange Act, pursuant to which it will place limit
orders for $4,000,000 of the Common Stock commencing ten Business Days after
the
Company files its Current Report on Form 8-K announcing the execution of a
definitive agreement for a Business Combination and ending on the Business
Day
immediately preceding the meeting date for the meeting of stockholders at which
such Business Combination is to be approved. These purchases will be made in
accordance with Rule 10b-18 under the Act at a price equal to the per share
amount held in the Trust Account (less taxes payable) as reported in such Form
8-Kand will be made by a broker dealer mutually agreed upon by the Sponsor
and
the Representative in such amounts and at such times as such broker dealer
may
determine, in its sole discretion, so long as the purchase price does not exceed
the above-referenced per share purchase price. In the event the Sponsor does
not
purchase $4,000,000 of our common stock through those open market purchases,
the
Sponsor has agreed to purchase from the Company in a private placement, a number
of units identical to the units offered hereby at a purchase price of $8.00
per
unit until it has spent an aggregate of $4,000,000 in the open market purchases
described above and this private placement.
3.28
Amendments
to Certificate of Incorporation
. (1)
The Company covenants and agrees, that prior to its initial Business Combination
it will not seek to amend or modify any of the following provisions (A) - (F)
of
Article Sixth of its certificate of incorporation:
“A.
Immediately after the Corporation’s initial public offering (the “
IPO”),
the
amount of the net offering proceeds received by the Corporation in the IPO
(including the proceeds of any exercise of the underwriter’s over-allotment
option) specified in the Corporation’s registration statement on Form S-1 filed
with the Securities and Exchange Commission (the “ Registration
Statement”)
shall
be deposited and thereafter held in a trust account established by the
Corporation (the “ Trust
Account”).
Neither the Corporation nor any officer, director or employee of the Corporation
shall disburse any of the proceeds held in the Trust Account until the earlier
of (i) a Business Combination or (ii) the Termination Date, in each case in
accordance with the terms of the investment management trust agreement governing
the Trust Account; provided, however, that (x) a portion of the interest earned
on the Trust Account as described in the Registration Statement may be released
to the Corporation to cover operating expenses, and (y) the Corporation shall
be
entitled to withdraw such amounts from the Trust Account as would be required
to
pay taxes on the interest earned on the Trust Account.
-23-
B.
Prior to the consummation of any Business Combination, the Corporation shall
submit such Business Combination to its stockholders for approval regardless
of
whether the Business Combination is of a type which normally would require
such
stockholder approval under the DGCL. In the event a majority of the shares
cast
at the meeting to approve the Business Combination are voted for the approval
of
such Business Combination, the Corporation shall be authorized to consummate
the
Business Combination; provided, however, that the Corporation shall not
consummate any Business Combination if holders of an aggregate of 30% or more
in
interest of the IPO Shares exercise their redemption rights described in
paragraph C below.
C.
In the event that a Business Combination is approved in accordance with the
above paragraph B and is consummated by the Corporation, any stockholder of
the
Corporation holding shares of Common Stock issued in the IPO (the “ IPO
Shares”)
who
voted against the Business Combination may, contemporaneous with such vote,
demand the Corporation redeem his IPO Shares for cash. If so demanded, the
Corporation shall, promptly after consummation of the Business Combination,
redeem, subject to the availability of lawful funds therefor, such shares at
a
per share redemption price equal to the amount held in the Trust Account as
of
two business days prior to the consummation of the Business Combination (net
of
taxes payable), divided by the total number of IPO Shares, which shall in no
event be less than $7.90 per share.
D.
The holders of IPO Shares shall be entitled to receive distributions from the
Trust Account only (i) in the event that the Corporation has not consummated
a
Business Combination by the Termination Date or (ii) in the event they demand
redemption of their IPO Shares in accordance with subparagraph C and a Business
Combination is approved in accordance with subparagraph B. The Corporation
shall
pay no liquidating distributions with respect to any shares of capital stock
of
the Corporation other than IPO Shares. In no other circumstances shall a holder
of IPO Shares have any right or interest of any kind in or to the Trust Account.
A holder of securities issued in the private placement concurrently with or
prior to the consummation of the IPO shall not have any right or interest of
any
kind in or to the Trust Account.
E.
Unless and until the Corporation has consummated a Business Combination as
permitted under this Article Sixth, the Corporation may not consummate any
other
business combination, whether by merger, capital stock exchange, stock purchase,
asset acquisition or otherwise.
F.
The Board of Directors shall be divided into two classes: Class A and
Class B. The number of directors in each class shall be as nearly equal as
possible. Prior to the IPO, there shall be elected two Class A directors
for a term expiring at the Corporation’s first Annual Meeting of Stockholders
and two Class B directors for a term expiring at the Corporation’s second
Annual Meeting of Stockholders. Commencing at the first Annual Meeting of
Stockholders, and at each annual meeting thereafter, directors elected to
succeed those directors whose terms expire shall be elected for a term of office
to expire at the second succeeding annual meeting of stockholders after their
election. Except as the DGCL may otherwise require, in the interim between
annual meetings of stockholders or special meetings of stockholders called
for
the election of directors and/or the removal of one or more directors and the
filling of any vacancy in that connection, newly created directorships and
any
vacancies in the Board of Directors, including unfilled vacancies resulting
from
the removal of directors for cause, may be filled by the vote of a majority
of
the remaining directors then in office, although less than a quorum (as defined
in the Corporation’s Bylaws), or by the sole remaining director. All directors
shall hold office until the expiration of their respective terms of office
and
until their successors shall have been elected and qualified. A director elected
to fill a vacancy resulting from the death, resignation or removal of a director
shall serve for the remainder of the full term of the director whose death,
resignation or removal shall have created such vacancy and until his successor
shall have been elected and qualified.”
-24-
(ii)
The
Company acknowledges that the purchasers of the Public Securities in the
Offering shall be deemed to be third party beneficiaries of this Agreement
and
specifically this Section 3.28.
(iii)
The
Representative specifically advises the Company that it will not waive this
Section 3.28 under any circumstances.
3.29
Private
Placement Proceeds
. Prior
to the Effective Date and execution of this Agreement, the Company shall deposit
$2,500,000 of the proceeds from the Private Placement in the Trust Account
and
shall provide ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. with evidence of the same.
4.
Conditions
of Underwriters’ Obligations
. The
obligations of the several Underwriters to purchase and pay for the Units,
as
provided herein, shall be subject to the continuing accuracy of the
representations and warranties of the Company as of the date hereof and as
of
each of the Closing Date and the Option Closing Date, if any, to the accuracy
of
the statements of officers of the Company made pursuant to the provisions hereof
and to the performance by the Company of its obligations hereunder and to the
following conditions:
4.1
Regulatory
Matters
.
4.1.1
Effectiveness
of Registration Statement
. The
Registration Statement shall have become effective not later than 5:00 p.m.,
New
York time, on the date of this Agreement or such later date and time as shall
be
consented to in writing by you, and, at each of the Closing Date and the Option
Closing Date, no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for the purpose shall have
been instituted or shall be pending or contemplated by the Commission and any
request on the part of the Commission for additional information shall have
been
complied with to the reasonable satisfaction of ▇▇▇▇▇▇▇▇▇, counsel to the
Underwriters.
4.1.2
NASD
Clearance
. By the
Effective Date, the Representative shall have received clearance from the NASD
as to the amount of compensation allowable or payable to the Underwriters as
described in the Registration Statement.
-25-
4.1.3
No
Blue Sky Stop Orders
. No
order suspending the sale of the Units in any jurisdiction designated by you
pursuant to Section 3.4 hereof shall have been issued on either on the Closing
Date or the Option Closing Date, and no proceedings for that purpose shall
have
been instituted or shall be contemplated.
4.1.4
The
OTC Bulletin Board
. The
Securities shall have been admitted and approved for quotation on the OTC
Bulletin Board.
4.2
Company
Counsel Matters
.
4.2.1
Closing
Date and Option Closing Date Opinion of Counsel
. On the
Closing Date and the Option Closing Date, if any, the Representative shall
have
received the favorable opinion of Ellenoff ▇▇▇▇▇▇▇▇ & Schole LLP, dated the
Closing Date or the Option Closing Date, as the case may be, addressed to the
Representative and in form and substance reasonably satisfactory to ▇▇▇▇▇▇▇▇▇,
covering the matters set forth on Appendix A hereto.
4.2.2
Reliance
. In
rendering such opinion, such counsel may rely (i) as to matters involving the
application of laws other than the laws of the United States and jurisdictions
in which they are admitted, to the extent such counsel deems proper and to
the
extent specified in such opinion, if at all, upon an opinion or opinions (in
form and substance reasonably satisfactory to ▇▇▇▇▇▇▇▇▇) of other counsel
reasonably acceptable to ▇▇▇▇▇▇▇▇▇, familiar with the applicable laws, and
(ii)
as to matters of fact, to the extent they deem proper, on certificates or other
written statements of officers of the Company and officers of departments of
various jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company, provided that copies of any such
statements or certificates shall be delivered to the Underwriters’ counsel if
requested. The opinion of counsel for the Company and any opinion relied upon
by
such counsel for the Company shall include a statement to the effect that it
may
be relied upon by counsel for the Underwriters in its opinion delivered to
the
Underwriters.
4.3
Cold
Comfort Letter
. At the
time this Agreement is executed, and at each of the Closing Date and the Option
Closing Date, if any, you shall have received a letter, addressed to the
Representative and in form and substance satisfactory in all respects (including
the non-material nature of the changes or decreases, if any, referred to in
clause (iii) below) to you and to ▇▇▇▇▇▇▇▇▇ from ▇▇▇▇▇▇ dated, respectively,
as
of the date of this Agreement and as of the Closing Date and the Option Closing
Date, if any:
(i)
Confirming that they are independent accountants with respect to the
Company within the meaning of the Act and the applicable Regulations and that
they have not, during the periods covered by the financial statements included
in the Preliminary Prospectus, Sale Preliminary Prospectus and the Prospectus,
provided to the Company any non-audit services, as such term is used in Section
10A(g) of the Exchange Act;
(ii)
Stating that in their opinion the financial statements of the Company
included in the Registration Statement, the Sale Preliminary Prospectus and
the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act and the published Regulations
thereunder;
-26-
(iii)
Stating that, on the basis of their review which included a reading of
the latest available unaudited interim financial statements of the Company
(with
an indication of the date of the latest available unaudited interim financial
statements), a reading of the latest available minutes of the stockholders
and
board of directors and the various committees of the board of directors,
consultations with officers and other employees of the Company responsible
for
financial and accounting matters and other specified procedures and inquiries,
nothing has come to their attention which would lead them to believe that (a)
the unaudited financial statements of the Company included in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus do not comply
as
to form in all material respects with the applicable accounting requirements
of
the Act and the Regulations or are not fairly presented in conformity with
generally accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements of the Company included
in the Registration Statement, the Sale Preliminary Prospectus and the
Prospectus, or (b) at a date not later than five days prior to the Effective
Date, Closing Date or Option Closing Date, as the case may be, there was any
change in the capital stock or long-term debt of the Company, or any decrease
in
the stockholders’ equity of the Company as compared with amounts shown in the
[_______,
2007]
balance
sheet included in the Registration Statement, the Sale Preliminary Prospectus
and the Prospectus, other than as set forth in or contemplated by the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
or,
if there was any decrease, setting forth the amount of such decrease, and (c)
during the period from [__________, 2007] to a specified date not later than
five days prior to the Effective Date, Closing Date or Option Closing Date,
as
the case may be, there was any decrease in revenues, net earnings or net
earnings per share of Common Stock, in each case as compared with the
corresponding period in the preceding year and as compared with the
corresponding period in the preceding quarter, other than as set forth in or
contemplated by the Registration Statement the Sale Preliminary Prospectus
and
the Prospectus, or, if there was any such decrease, setting forth the amount
of
such decrease;
(iv)
Setting forth, at a date not later than five days prior to the Effective
Date, the amount of liabilities of the Company (including a break-down of
commercial papers and notes payable to banks);
(v)
Stating that they have compared specific dollar amounts, numbers of
shares, percentages of revenues and earnings, statements and other financial
information pertaining to the Company set forth in the Registration Statement,
the Sale Preliminary Prospectus and the Prospectus in each case to the extent
that such amounts, numbers, percentages, statements and information may be
derived from the general accounting records, including work sheets, of the
Company and excluding any questions requiring an interpretation by legal
counsel, with the results obtained from the application of specified readings,
inquiries and other appropriate procedures (which procedures do not constitute
an examination in accordance with generally accepted auditing standards) set
forth in the letter and found them to be in agreement;
-27-
(vi)
Stating that they have not, since the Company’s incorporation, brought to
the attention of the Company’s management any reportable condition related to
internal structure, design or operation as defined in the Statement on Auditing
Standards No. 60 “Communication of Internal Control Structure Related Matters
Noted in an Audit,” in the Company’s internal controls; and
(vii)
Statements as to such other matters incident to the transaction
contemplated hereby as you may reasonably request.
4.4
Officers’
Certificates
.
4.4.1
Officers’
Certificate
. At
each of the Closing Date and the Option Closing Date, if any, the Representative
shall have received a certificate of the Company signed by the Chairman of
the
Board or the President and the Secretary or Assistant Secretary of the Company
(in their capacities as such), dated the Closing Date or the Option Closing
Date, as the case may be, respectively, to the effect that the Company has
performed all covenants and complied with all conditions required by this
Agreement to be performed or complied with by the Company prior to and as of
the
Closing Date, or the Option Closing Date, as the case may be, and that the
conditions set forth in Section 4.5 hereof have been satisfied as of such date
and that, as of Closing Date and the Option Closing Date, as the case may be,
the representations and warranties of the Company set forth in Section 2 hereof
are true and correct. In addition, the Representative will have received such
other and further certificates of officers of the Company (in their capacities
as such) as the Representative may reasonably request.
4.4.2
Secretary’s
Certificate
. At
each of the Closing Date and the Option Date, if any, the Representative shall
have received a certificate of the Company signed by the Secretary or Assistant
Secretary of the Company, dated the Closing Date or the Option Date, as the
case
may be, respectively, certifying (i) that the Bylaws and Certificate of
Incorporation of the Company are true and complete, have not been modified
and
are in full force and effect, (ii) that the resolutions relating to the public
offering contemplated by this Agreement are in full force and effect and have
not been modified, (iii) all correspondence between the Company or its counsel
and the Commission, and (iv) as to the incumbency of the officers of the
Company. The documents referred to in such certificate shall be attached to
such
certificate.
4.5
No
Material Changes
. Prior
to and on each of the Closing Date and the Option Closing Date, if any, (i)
there shall have been no material adverse change or development involving a
prospective material adverse change in the condition or prospects or the
business activities, financial or otherwise, of the Company from the latest
dates as of which such condition is set forth in the Registration Statement,
the
Sale Preliminary Prospectus and the Prospectus, (ii) no action suit or
proceeding, at law or in equity, shall have been pending or threatened against
the Company or any Existing Stockholder before or by any court or Federal or
state commission, board or other administrative agency wherein an unfavorable
decision, ruling or finding may materially adversely affect the business,
operations, prospects or financial condition or income of the Company, except
as
set forth in the Registration Statement, the Sale Preliminary Prospectus and
the
Prospectus, (iii) no stop order shall have been issued under the Act and no
proceedings therefor shall have been initiated or threatened by the Commission,
and (iv) the Registration Statement, the Sale Preliminary Prospectus and the
Prospectus and any amendments or supplements thereto shall contain all material
statements which are required to be stated therein in accordance with the Act
and the Regulations and shall conform in all material respects to the
requirements of the Act and the Regulations, and neither the Registration
Statement, the Sale Preliminary Prospectus nor the Prospectus nor any amendment
or supplement thereto shall contain any untrue statement of a material fact
or
omits to state any material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading.
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4.6
Delivery
of Agreements
.
4.6.1
Effective
Date Deliveries
. On the
Effective Date, the Company shall have delivered to the Representative executed
copies of the Escrow Agreement, the Trust Agreement, the Warrant Agreement,
the
Services Agreement, and all of the Insider Letters and Subscription
Agreement.
4.6.2
Closing
Date Deliveries
. On the
Closing Date, the Company shall have delivered to the Representative executed
copies of the Representative’s Purchase Option.
4.7
Opinion
of Counsel for the Underwriters
. All
proceedings taken in connection with the authorization, issuance or sale of
the
Securities as herein contemplated shall be reasonably satisfactory in form
and
substance to you and to ▇▇▇▇▇▇▇▇▇ and you shall have received from such counsel
a favorable opinion, dated the Closing Date and the Option Closing Date, if
any,
with respect to such of these proceedings as you may reasonably require. On
or
prior to the Effective Date, the Closing Date and the Option Closing Date,
as
the case may be, counsel for the Underwriters shall have been furnished such
documents, certificates and opinions as they may reasonably require for the
purpose of enabling them to review or pass upon the matters referred to in
this
Section 4.7, or in order to evidence the accuracy, completeness or satisfaction
of any of the representations, warranties or conditions herein
contained.
4.8
Secondary
Market Trading and Standard & Poor’s
. Unless
the Public Securities are listed or quoted, as the case may be, on the New
York
Stock Exchange, the American Stock Exchange, the NASDAQ Global Market or the
NASDAQ Capital Market, the Company will apply to be included in Standard &
Poor’s Daily News and Corporation Records Corporate Descriptions for a period of
five years from the consummation of a Business Combination. Promptly after
the
consummation of the Offering, the Company shall take such steps as may be
necessary to obtain a secondary market trading exemption for the Company’s
securities in the State of California. Unless the Public Securities are listed
or quoted, as the case may be, on the New York Stock Exchange, the American
Stock Exchange, the NASDAQ Global Market, or the NASDAQ Capital Market, the
Company shall also take such other action as may be reasonably requested by
the
Representative to obtain a secondary market trading exemption in such other
states as may be requested by the Representative.
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5.
Indemnification
.
5.1
Indemnification
of Underwriters
.
5.1.1
General
.
Subject to the conditions set forth below, the Company agrees to indemnify
and
hold harmless each of the Underwriters, and each dealer selected by you that
participates in the offer and sale of the Securities (each a “ Selected
Dealer”)
and
each of their respective directors, officers and employees and each person,
if
any, who controls any such Underwriter (“controlling person”) within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act, against any
and
all loss, liability, claim, damage and expense whatsoever as incurred to which
they or any of them may become subject under the Act, the Exchange Act or any
other statute or at common law or otherwise or under the laws of foreign
countries, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in (i) any Preliminary Prospectus, the
Registration Statement, Sale Preliminary Prospectus or the Prospectus (as from
time to time each may be amended and supplemented, including, but not limited
to
any information deemed to be a part thereof pursuant to Rule 430A, Rule 430B
or
Rule 430C); (ii) any materials or information provided to investors by, or
with
the approval of, the Company in connection with the marketing of the offering
of
the Securities, including any “road show” or investor presentations made to
investors by the Company (whether in person or electronically); (iii) any
application or other document or written communication (in this Section 5,
collectively called “application”) executed by the Company or based upon written
information furnished by the Company in any jurisdiction in order to qualify
the
Securities under the securities laws thereof or filed with the Commission,
any
state securities commission or agency, NASDAQ or any securities exchange; or
(iv) any post-effective amendments to the Registration Statement or Prospectus
or new Registration Statement or Prospectus filed by the Company with the
Commission, any state securities commission or agency, NASDAQ or any securities
exchange in which is included any of the Representative’s Securities, or the
omission or alleged omission from any Preliminary Prospectus, the Registration
Statement, the Sale Preliminary Prospectus or the Prospectus or subsequent
filing by the Company under clause (iv) of a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and to reimburse
each
Underwriter, each Selected Dealer and each of their respective directors,
officers and employees and each controlling person, if any, for any and all
expenses (including the fees and disbursements or counsel chosen by ▇▇▇▇▇▇
▇▇▇▇▇▇ & Co.) as such expenses are incurred by such Underwriter, such
Selected Dealer or each of their respective directors, officers and employees
or
such controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim damage, liability, expense or
action; provided however, that the foregoing indemnity agreement shall not
apply
to any loss, claim, damage, liability or expenses to the extent, but only to
the
extent, arising out of or based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company with respect to
an
Underwriter by or on behalf of such Underwriter expressly for use in any
Preliminary Prospectus, the Registration Statement, Sale Preliminary Prospectus
or the Prospectus, or any amendment or supplement thereof, or in any
application, as the case may be. With respect to any untrue statement or
omission or alleged untrue statement or omission made in the Preliminary
Prospectus, the indemnity agreement contained in this paragraph shall not inure
to the benefit of any Underwriter to the extent that any loss, liability, claim,
damage or expense of such Underwriter results from the fact that a copy of
the
Prospectus was not given or sent to the person asserting any such loss,
liability, claim or damage at or prior to the written confirmation of sale
of
the Securities to such person as required by the Act and the Regulations, and
if
the untrue statement or omission has been corrected in the Prospectus, unless
such failure to deliver the Prospectus was a result of non-compliance by the
Company with its obligations under Section 3.4 hereof. The Company agrees
promptly to notify the Representative of the commencement of any litigation
or
proceedings against the Company or any of its officers, directors or controlling
persons in connection with the issue and sale of the Securities or in connection
with the Registration Statement, the Sale Preliminary Prospectus or the
Prospectus. The indemnity agreement set forth in this Section 5.1 shall be
in
addition to any liabilities that the Company may otherwise have.
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5.2
Indemnification
of the Company
. Each
Underwriter, severally and not jointly, agrees to indemnify and hold harmless
the Company, each of its directors, each of 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 against
any and all loss, liability, claim, damage and expense described in the
foregoing indemnity from the Company to the several Underwriters, as incurred,
but only with respect to untrue statements or omissions, or alleged untrue
statements or omissions made in any Preliminary Prospectus, the Registration
Statement, the Sale Preliminary Prospectus, the Prospectus or any amendment
or
supplement thereto or in any application, in reliance upon, and in strict
conformity with, written information furnished to the Company with respect
to
such Underwriter by or on behalf of the Underwriter expressly for use in such
Preliminary Prospectus, the Registration Statement, the Sale Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto or in any
such
application; and to reimburse the Company or any such director, officer or
controlling person, if any, for any and all expenses as such expenses are
reasonably incurred, in connection with investigating, defending, settling,
compromising or paying any such loss, claim damage, liability, expense or
action; provided, however, that the obligation of each Underwriter to indemnify
the Company (including any director, officer or controlling person thereof,
shall be limited to the commissions received by such Underwriter in connection
with the Securities underwritten by it. The Company hereby acknowledges that
the
only information that the Underwriters have furnished to the Company expressly
for use in the Preliminary Prospectus, the Registration Statement, the Sale
Preliminary Prospectus, the Prospectus or any amendment or supplement thereto
or
in any such application, are the statements set forth in the paragraphs entitled
“Pricing of Securities” and “Commissions and Discounts” under the caption
“Underwriting” in the Prospectus. The indemnity agreement set forth in this
Section 5.2 shall be in addition to any liabilities that each Underwriter may
otherwise have.
5.3
Notifications
and Other Indemnification Procedures
.
Promptly after receipt by an indemnified party under this Section 5 of notice
of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party under this Section
5, notify the indemnifying party in writing of the commencement thereof, but
the
failure to so notify the indemnifying party (i) will not relieve it from
liability under paragraph 5.1 or 5.2 above unless and to the extent it did
not
otherwise learn of such action and such failure results in the forfeiture by
the
indemnifying party of substantial rights and defenses and (ii) will not, in
any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph 5.1 or
5.2
above. In case any such action is brought against any indemnified party and
such
indemnified party seeks or intends to seek indemnity from an indemnifying party,
the indemnifying party will be entitled to participate in, and, to the extent
that it shall elect, jointly with all other indemnifying parties similarly
notified, by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof with counsel satisfactory to such indemnified party; provided,
however, if the defendants in any such action include both the indemnified
party
and the indemnifying party and the indemnified party shall have reasonably
concluded that a conflict may arise between the positions of the indemnifying
party and the indemnified party in conducting the defense of any such action
or
that there may be legal defenses available to it and/or other indemnified
parties that are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party
or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of such indemnifying party’s election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 5 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in accordance with the provision to the preceding sentence
reasonably approved by the indemnifying party (or by ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. in
the case of Section 5.2), representing the indemnified parties who are parties
to such action) or (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action, in each of which
cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
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5.4
Settlements
. The
indemnifying party under this Section 5 shall not be liable for any settlement
of any proceeding effected without its written consent, which shall not be
withheld unreasonably, but if settled with such consent or if there is a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by Section 5.3 hereof, the indemnifying party 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 such indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity was or could have been sought
hereunder by such indemnified party, unless such settlement, compromise or
consent (x) includes an unconditional release of such indemnified party from
all
liability on claims that are the subject matter of such action, suit or
proceeding and (y) 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.
5.5
Contribution
.
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5.5.1
Contribution
Rights
. In
order to provide for just and equitable contribution under the Act in any case
in which (i) any person entitled to indemnification under this Section 5 makes
claim for indemnification pursuant hereto but it is judicially determined (by
the entry of a final judgment or decree by a court of competent jurisdiction
and
the expiration of time to appeal or the denial of the last right of appeal)
that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 5 provides for indemnification in such case, or (ii)
contribution under the Act, the Exchange Act or otherwise may be required on
the
part of any such person in circumstances for which indemnification is provided
under this Section 5, then, and in each such case, the Company and the
Underwriters shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Underwriters, as incurred, in such proportions
that the Underwriters are responsible for that portion represented by the
percentage that the underwriting discount appearing on the cover page of the
Prospectus bears to the initial offering price appearing thereon and the Company
is responsible for the balance; provided, that, no person guilty of a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company and the Underwriters shall
contribute in such proportion as is appropriate to reflect the relative fault
of
the Company and the Underwriters in connection with the actions or omissions
which resulted in such loss, claim, damage, liability or action, as well as
any
other relevant equitable considerations. The relative fault of the Company
and
the Underwriters 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 or the Underwriters and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. Notwithstanding the provisions of this Section 5.5.1,
no
Underwriter shall be required to contribute any amount in excess of the
underwriting commissions received by such Underwriter in connection with the
Securities underwritten by it and distributed to the public. For purposes of
this Section, each director, officer and employee of an Underwriter or the
Company, as applicable, and each person, if any, who controls an Underwriter
or
the Company, as applicable, within the meaning of Section 15 of the Act shall
have the same rights to contribution as the Underwriters or the Company, as
applicable.
5.5.2
Contribution
Procedure
. Within
fifteen days after receipt by any party to this Agreement (or its
representative) of notice of the commencement of any action, suit or proceeding,
such party will, if a claim for contribution in respect thereof is to be made
against another party (“ contributing
party”),
notify the contributing party of the commencement thereof, but the omission
to
so notify the contributing party will not relieve it from any liability which
it
may have to any other party other than for contribution hereunder. In case
any
such action, suit or proceeding is brought against any party, and such party
notifies a contributing party or its representative of the commencement thereof
within the aforesaid fifteen days, the contributing party will be entitled
to
participate therein with the notifying party and any other contributing party
similarly notified. Any such contributing party shall not be liable to any
party
seeking contribution on account of any settlement of any claim, action or
proceeding effected by such party seeking contribution on account of any
settlement of any claim, action or proceeding effected by such party seeking
contribution without the written consent of such contributing party. The
contribution provisions contained in this Section are intended to supersede,
to
the extent permitted by law, any right to contribution under the Act, the
Exchange Act or otherwise available. The Underwriters’ obligations to contribute
pursuant to this Section 5.3 are several and not joint.
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6.
Default
by an Underwriter
.
6.1
Default
Not Exceeding 10% of Firm Units or Option Units
. If any
Underwriter or Underwriters shall default in its or their obligations to
purchase the Firm Units or the Option Units, if the Over-Allotment Option is
exercised, hereunder, and if the number of the Firm Units or Option Units with
respect to which such default relates does not exceed in the aggregate 10%
of
the number of Firm Units or Option Units that all Underwriters have agreed
to
purchase hereunder, then such Firm Units or Option Units to which the default
relates shall be purchased by the non-defaulting Underwriters in proportion
to
their respective commitments hereunder.
6.2
Default
Exceeding 10% of Firm Units or Option Units
. In the
event that the default addressed in Section 6.1 above relates to more than
10%
of the Firm Units or Option Units, you may in your discretion arrange for
yourself or for another party or parties to purchase such Firm Units or Option
Units to which such default relates on the terms contained herein. If within
one
Business Day after such default relating to more than 10% of the Firm Units
or
Option Units you do not arrange for the purchase of such Firm Units or Option
Units, then the Company shall be entitled to a further period of one Business
Day within which to procure another party or parties satisfactory to you to
purchase said Firm Units or Option Units on such terms. In the event that
neither you nor the Company arrange for the purchase of the Firm Units or Option
Units to which a default relates as provided in this Section 6, this Agreement
will be terminated by you or the Company without liability on the part of the
Company (except as provided in Sections 3.12 and 5 hereof) or the several
Underwriters (except as provided in Section 5 hereof); provided, however, that
if such default occurs with respect to the Option Units, this Agreement will
not
terminate as to the Firm Units; and provided further that nothing herein shall
relieve a defaulting Underwriter of its liability, if any, to the other several
Underwriters and to the Company for damages occasioned by its default
hereunder.
6.3
Postponement
of Closing Date
. In the
event that the Firm Units or Option Units to which the default relates are
to be
purchased by the non-defaulting Underwriters, or are to be purchased by another
party or parties as aforesaid, you or the Company shall have the right to
postpone the Closing Date or Option Closing Date for a reasonable period, but
not in any event exceeding five Business Days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement, the Sale
Preliminary Prospectus or the Prospectus or in any other documents and
arrangements, and the Company agrees to file promptly any amendment to the
Registration Statement or the Prospectus that in the opinion of counsel for
the
Underwriters may thereby be made necessary. The term “ Underwriter”
as
used
in this Agreement shall include any party substituted under this Section 6
with
like effect as if it had originally been a party to this Agreement with respect
to such Securities.
7.
Right
to Appoint Observer
. Until
the consummation of a Business Combination, upon notice from ▇▇▇▇▇▇ ▇▇▇▇▇▇
&
Co. to the Company, ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. shall have the right to send a
representative (who need not be the same individual from meeting to meeting)
to
observe each meeting of the Board of Directors of the Company; provided that
such representative shall sign a Regulation FD compliant confidentiality
agreement which is reasonably acceptable to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. and its
counsel in connection with such representative’s attendance at meetings of the
Board of Directors; and provided further that upon written notice to ▇▇▇▇▇▇
▇▇▇▇▇▇ & Co., the Company may exclude the representative from meetings
where, in the written opinion of counsel for the Company, the representative’s
presence would destroy the attorney-client privilege. The Company agrees to
give
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. written notice of each such meeting and to provide
▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. with an agenda and minutes of the meeting no later than
it gives such notice and provides such items to the other directors and to
reimburse the representative of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. for his reasonable
out-of-pocket expenses incurred in connection with his attendance at the
meeting, including but not limited to, food, lodging and
transportation.
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8.
Additional
Covenants
.
8.1
Additional
Shares or Options
. The
Company hereby agrees that until the consummation of a Business Combination,
it
shall not issue any shares of Common Stock (except with respect to any exercise
of Warrants) or any options or other securities convertible into Common Stock,
or any shares of preferred stock or other Securities of the Company which
participate in any manner in the Trust Account or which vote as a class with
the
Common Stock on a Business Combination.
8.2
Trust
Account Waiver Acknowledgment
. The
Company hereby agrees that it will use its reasonable best efforts prior to
engaging in discussions with any operating business which the Company seeks
to
acquire (“ Target
Business”)
or
obtaining the services of any vendor to acknowledge in writing whether through
a
letter of intent, memorandum of understanding or other similar document (and
subsequently acknowledges the same in any definitive document replacing any
of
the foregoing, that (a) it has read the Prospectus and understands that the
Company has established the Trust Account, initially in an amount of $35,550,000
(without giving effect to any exercise of the Over-allotment Option) for the
benefit of the public stockholders and that, except for a portion of the
interest earned on the amounts held in the Trust Account, the Company may
disburse monies from the Trust Account only (i) to the public stockholders
in
the event they elect to redeem their IPO Shares (as defined below in Section
8.5), (ii) to the holders of the IPO Shares upon the liquidation of the Company
if the Company fails to consummate a Business Combination, (iii) after or
concurrently with the consummation of a Business Combination, or (iv) to the
Company only with respect to the interest income, net of taxes, to fund working
capital and (b) for and in consideration of the Company (i) agreeing to evaluate
such Target Business for purposes of consummating a Business Combination with
it
or (ii) agreeing to engage the services of the vendor, as the case may be,
such
Target Business or vendor agrees that it does not have any right, title,
interest or claim of any kind in or to any monies in the Trust Account (“
Claim”)
and
waives any Claim it may have in the future as a result of, or arising out of,
any negotiations, contracts or agreements with the Company and will not seek
recourse against the Trust Account for any reason whatsoever. The foregoing
letters shall substantially be in the form attached hereto as Exhibits A and
B
respectively. The Company may forego obtaining such waivers only if the Company
shall have received the approval of its Chief Executive Officer and the
approving vote or written consent of at least a majority of its Board of
Directors.
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8.3
Insider
Letters
. The
Company shall not take any action or omit to take any action which would cause
a
breach of any of the Insider Letters or the warrant purchase agreements executed
between each Existing Stockholder and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & Co. and will not allow
any amendments to, or waivers of, such Insider Letters without the prior written
consent of the Representative.
8.4
Certificate
of Incorporation and Bylaws
. The
Company shall not take any action or omit to take any action that would cause
the Company to be in breach or violation of its Certificate of Incorporation
or
Bylaws. Prior to the consummation of a Business Combination, the Company will
not amend its Certificate of Incorporation without the prior written consent
of
the Representative.
8.5
Acquisition/Liquidation
Procedure
. The
Company agrees: (i) prior to the consummation of any Business Combination,
it
will submit such transaction to the Company’s stockholders for their approval (“
Business
Combination Vote”)
even
if the nature of the acquisition is such as would not ordinarily require
stockholder approval under the laws of the state of Delaware; and (ii) in the
event that the Company does not effect a business combination within twenty-four
months from the consummation of the offering (the “ Termination
Date”),
this
shall trigger an automatic winding-up of the Company and the trust account
will
be liquidated to holders of IPO Shares in the manner described in the Sale
Preliminary Prospectus and the Prospectus as soon as reasonably practicable,
and
subject to the requirements of the laws of the state of Delaware. For purposes
of this Section 8.5, the term “ IPO
Shares”
means
the shares of Common Stock contained in the Public Securities.
8.5.1
Upon liquidation of the Trust Account, subject to the requirements of the
laws of the State of Delaware, the Company will distribute only to the holders
of IPO Shares an aggregate sum equal to the Company’s Liquidation Value, which
sum shall be distributed pro rata among the holders of the IPO Shares. The
Company’s “ Liquidation
Value”
means:
(i) all of the all principal and accrued interest contained within the Trust
Account, less any amounts previously distributed to the Company out of the
interest earned on the Trust Account pursuant to the terms of the Trust
Agreement (after payment of, or provision for, applicable taxes and claims
of
creditors) PLUS (ii) all cash and other liquid assets (which shall be reduced
to
cash as part of the Company’s winding up) then held by the Company outside of
the Trust Account, all as distributed in amounts to the holders as determined
by
CST, as trustee of the Trust Account. Only holders of IPO Shares as of the
record date for the distribution shall be entitled to receive liquidating
distributions with respect to the IPO Shares they beneficially own and the
Company shall pay no liquidating distributions with respect to any other shares
of capital stock of the Company, including the shares of Common Stock held
by
the Existing Stockholders prior to the Offering (but shall include Common Stock
underlying the Placement Warrants and Common Stock purchased by Existing
Stockholders after the Offering).
8.5.2
With respect to the Business Combination Vote, the Existing Stockholders
shall vote all Common Stock owned by them as of the record date of the vote
in
accordance with the vote of holders of a majority of the IPO Shares present,
in
person or by proxy, at a meeting of the Company’s stockholders in connection
with the Business Combination Vote.
-36-
8.5.3
At the time the Company seeks approval of any potential Business
Combination (prior to the confirmation of its initial Business Combination),
the
Company will offer each of the holders of the IPO Shares the right to redeem
their IPO Shares into a pro rata share of the Trust Account (the “ Conversion
Price”).
If
holders of less than 30% in interest of the Company’s Common Stock vote against
such approval of a Business Combination, the Company may, but will not be
required to, proceed with such Business Combination. If the Company elects
to so
proceed, it will redeem shares of Common Stock, based upon the Conversion Price,
from those holders of Common Stock who affirmatively requested such redemption
and who voted against the Business Combination as provided under the laws of
the
State of Delaware. If holders of 30% or more in interest of the Common Stock
vote against approval of any potential Business Combination, the Company will
not proceed with such Business Combination and will liquidate.
8.6
Rule
419
. The
Company agrees that it will use its best efforts to prevent the Company from
becoming subject to Rule 419 under the Act prior to the consummation of any
Business Combination, including but not limited to using its best efforts to
prevent any of the Company’s outstanding securities from being deemed to be a
“▇▇▇▇▇ stock” as defined in Rule 3a-51-1 under the Exchange Act during such
period.
8.7
Affiliated
Transactions
. The
Company shall cause each of the Existing Stockholders to agree that, in order
to
minimize potential conflicts of interest which may arise from multiple
affiliations, the Existing Stockholders will present to the Company for its
consideration, prior to presentation to any other person or company, any
suitable opportunity to acquire an operating business, until the earlier of
the
consummation by the Company of a Business Combination, the liquidation of the
Company or until such time as the Existing Stockholders cease to be an officer
or director of the Company, subject to any pre-existing fiduciary or contractual
obligations the Existing Stockholders might have.
8.8
Target
Net Assets
. The
Company agrees that its initial Business Combination must be with one or more
Target Businesses that have an aggregate fair market value equal to at least
80%
of the amount in the Company’s Trust Account (less Deferred Fees, including
interest thereon, held in the Trust Account) at the time of such Business
Combination. The fair market value of each Target Business must be determined
by
the Board of Directors of the Company based upon standards generally accepted
by
the financial community, such as actual and potential sales, earnings and cash
flow and book value. If the Board of Directors of the Company is not able to
independently determine that the Target Business has a sufficient fair market
value at the time of such transaction, the Company will obtain an opinion from
an unaffiliated, independent investment banking firm which is a member of the
NASD with respect to the satisfaction of such criteria. The Company is not
required to obtain an opinion from an investment banking firm as to the fair
market value if the Company’s Board of Directors independently determines that
the Target Business does have sufficient fair market value.
8.9
Proxy
and Other Information
. The
Company shall provide counsel to the Representative with ten copies of all
proxy
information and all related material filed with the commission in connection
with a Business Combination concurrently with such filing with the commission.
In addition, the Company shall furnish any other state in which its initial
public offering was registered, such information as may be requested by such
state.
-37-
9.
Representations
and Agreements to Survive Delivery
. Except
as the context otherwise requires, all representations, warranties and
agreements contained in this Agreement shall be deemed to be representations,
warranties and agreements as of the Closing Dates and such representations,
warranties and agreements of the Underwriters and the Company, including the
indemnity agreements contained in Section 5 hereof, shall remain operative
and
in full force and effect regardless of any investigation made by or on behalf
of
any Underwriter, the Company or any controlling person, and shall survive
termination of this Agreement or the issuance and delivery of the Securities
to
the several Underwriters until the earlier of the expiration of any applicable
statute of limitations and the seventh anniversary of the later of the Closing
Date or the Option Closing Date, if any, at which time the representations,
warranties and agreements shall terminate and be of no further force and
effect.
10.
Effective
Date of This Agreement and Termination Thereof
.
10.1
Effective
Date
. This
Agreement shall become effective on the Effective Date at the time the
Registration Statement is declared effective by the Commission.
10.2
Termination
. You
shall have the right to terminate this Agreement at any time prior to the
Closing Date, (i) if any domestic or international event or act or occurrence
has materially disrupted, or in your opinion will in the immediate future
materially disrupt, general securities markets in the United States; or (ii)
if
trading on the New York Stock Exchange, the American Stock Exchange, the NASDAQ
Global Market, the NASDAQ Capital Market or on the NASD OTC Bulletin Board
(or
successor trading market) shall have been suspended, or minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for
securities shall have been fixed, or maximum ranges for prices for securities
shall have been required on the American Stock Exchange, the NASDAQ Global
Market, the NASDAQ Capital Market or on the NASD OTC Bulletin Board (or
successor trading market) or by order of the Commission or any other government
authority having jurisdiction, or (iii) if the United States shall have become
involved in a new war or an increase in major hostilities, or (iv) if a banking
moratorium has been declared by a New York State or Federal authority, or (v)
if
a moratorium on foreign exchange trading has been declared which materially
adversely impacts the United States securities market, or (vi) if the Company
shall have sustained a material loss by fire, flood, accident, hurricane,
earthquake, theft, sabotage or other calamity or malicious act which, whether
or
not such loss shall have been insured, will, in your opinion, make it
inadvisable to proceed with the delivery of the Units, or (vii) if any of the
Company’s representations, warranties or covenants hereunder are breached, or
(viii) if the Representative shall have become aware after the date hereof
of
such a material adverse change in the conditions or prospects of the Company,
or
such adverse material change in general market conditions, including without
limitation as a result of terrorist activities after the date hereof, as in
the
Representative’s judgment would make it impracticable to proceed with the
offering, sale and/or delivery of the Units or to enforce contracts made by
the
Underwriters for the sale of the Securities.
10.3
Expenses
. In the
event that this Agreement shall not be carried out for any reason whatsoever,
within the time specified herein or any extensions thereof pursuant to the
terms
herein, the obligations of the Company to pay the out of pocket expenses related
to the transactions contemplated herein shall be governed by Section 3.12
hereof.
-38-
10.4
Indemnification
.
Notwithstanding any contrary provision contained in this Agreement, any election
hereunder or any termination of this Agreement, and whether or not this
Agreement is otherwise carried out, the provisions of Section 5 shall not be
in
any way effected by such election or termination or failure to carry out the
terms of this Agreement or any part hereof.
11.
Miscellaneous
.
11.1
Notices
. All
communications hereunder, except as herein otherwise specifically provided,
shall be in writing and shall be mailed, delivered or telecopied and confirmed
and shall be deemed given when so delivered or telecopied and confirmed or
if
mailed, two days after such mailing
If
to the
Representative:
▇▇▇▇▇▇
▇▇▇▇▇▇ & Co. Inc.
▇▇▇
▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇ ▇▇▇▇▇▇
Facsimile:
(▇▇▇-▇▇▇-▇▇▇▇
Copy
to:
▇▇▇▇▇▇▇▇▇
Will & ▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq.
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
If
to the
Company:
Camden
Learning Corporation
▇▇▇
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
President
Facsimile:
(410) [___________]
Copy
to:
Ellenoff
▇▇▇▇▇▇▇▇ & Schole LLP
▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
-39-
11.2
Headings
. The
headings contained herein are for the sole purpose of convenience of reference,
and shall not in any way limit or affect the meaning or interpretation of any
of
the terms or provisions of this Agreement.
11.3
Amendment
. This
Agreement may only be amended by a written instrument executed by each of the
parties hereto.
11.4
Entire
Agreement
. This
Agreement (together with the other agreements and documents being delivered
pursuant to or in connection with this Agreement) constitute the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof, and supersede all prior agreements and understandings of the parties,
oral and written, with respect to the subject matter hereof.
11.5
Binding
Effect
. This
Agreement shall inure solely to the benefit of and shall be binding upon the
Representative, the Underwriters, the Company and the controlling persons,
directors and officers referred to in Section 5 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have
or
be construed to have any legal or equitable right, remedy or claim under or
in
respect of or by virtue of this Agreement or any provisions herein contained.
This agreement and all conditions and provisions hereof are intended to be
for
the sole and exclusive benefit of the parties hereto and said controlling
persons and their respective successors, officers, directors, heirs and legal
representatives, and it is not for the benefit of any other person. The term
“successors and assigns” shall not include a purchaser, in its capacity as such,
of securities from any of the Underwriters. The Company acknowledges and agrees
that: (i) the sale and issuance of the securities pursuant to this Agreement
is
an arm’s-length commercial transaction between the Company and the Underwriters;
(ii) in connection therewith and with the process leading to the offering,
the
Underwriters are acting solely as a principal and not the agent or fiduciary
of
the Company; (iii) no Underwriter has assumed an advisory or fiduciary
responsibility in favor of the Company with respect to the offering contemplated
hereby or the process leading thereto, including any negotiation related to
the
pricing of the securities; and (iv) the Company has consulted its own legal
and
financial advisors to the extent it has deemed appropriate in connection with
this Agreement and the offering.
11.6
Governing
Law
. 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 Company hereby agrees that any action, proceeding
or
claim against it arising out of, or relating in any way to this Agreement shall
be brought and enforced in the courts of the State of New York or the United
States of America for the Southern District of New York, and irrevocably submits
to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby
waives any objection to such exclusive jurisdiction and that such courts
represent an inconvenient forum. Any such process or summons to be served upon
the Company may be served by transmitting a copy thereof by registered or
certified mail, return receipt requested, postage prepaid, addressed to it
at
the address set forth in Section 11.1 hereof. Such mailing shall be deemed
personal service and shall be legal and binding upon the Company in any action,
proceeding or claim. The Company agrees that the prevailing party(ies) in any
such action shall be entitled to recover from the other party(ies) all of its
reasonable attorneys’ fees and expenses relating to such action or proceeding
and/or incurred in connection with the preparation therefor.
-40-
11.7
Execution
in Counterparts
. This
Agreement may be executed in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which shall be deemed to be
an
original, but all of which taken together shall constitute one and the same
agreement, and shall become effective when one or more counterparts has been
signed by each of the parties hereto and delivered to each of the other parties
hereto.
11.8
Waiver,
Etc
. The
failure of any of the parties hereto to at any time enforce any of the
provisions of this Agreement shall not be deemed or construed to be a waiver
of
any such provision, nor to in any way affect the validity of this Agreement
or
any provision hereof or the right of any of the parties hereto to thereafter
enforce each and every provision of this Agreement. No waiver of any breach,
non-compliance or non-fulfillment of any of the provisions of this Agreement
shall be effective unless set forth in a written instrument executed by the
party or parties against whom or which enforcement of such waiver is sought;
and
no waiver of any such breach, non-compliance or non-fulfillment shall be
construed or deemed to be a waiver of any other or subsequent breach,
non-compliance or non-fulfillment.
[Remainder
of page intentionally left blank]
-41-
If
the
foregoing correctly sets forth the understanding between the Underwriters and
the Company, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between
us.
|
Very
truly yours,
CAMDEN
LEARNING CORPORATION
|
||
| |
|
|
| By: | ||
|
Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
President and Chief Executive
Officer
|
||
|
Accepted
on the date first
above
written.
▇▇▇▇▇▇
▇▇▇▇▇▇ & CO. INC.
|
|||
|
By:
|
|||
|
Name:
Title:
Managing Director
|
-42-
SCHEDULE
I
CAMDEN
LEARNING CORPORATION
4,500,000
Units
|
Underwriter
|
|
Number
of Firm Units
to
be Purchased
|
|
▇▇▇▇▇▇
▇▇▇▇▇▇ & Co. Inc.
|
|
|
-43-
APPENDIX
A
|
1.
|
The
Company has been duly organized and is validly existing as a corporation
and is in good standing under the laws of its state of incorporation.
The
Company is duly qualified and licensed and in good standing as a
foreign
corporation in each jurisdiction in which its ownership or leasing
of any
properties or the character of its operations requires such qualification
or licensing, except where the failure to qualify would not have
a
material adverse effect on the assets, business or operations of
the
Company.
|
|
2.
|
All
issued and outstanding securities of the Company (including, without
limitation, the Placement Warrants) have been duly authorized and
validly
issued and are fully paid and non-assessable; the holders thereof
are not
subject to personal liability by reason of being such holders; and
none of
such securities were issued in violation of the preemptive rights
of any
stockholder of the Company arising by operation of law or under the
Certificate of Incorporation or Bylaws of the Company. The offers
and
sales of the outstanding Common Stock were at all relevant times
either
registered under the Act or exempt from such registration requirements.
The authorized and, to such counsel’s knowledge, outstanding capital stock
of the Company is as set forth in the
Prospectus.
|
|
3.
|
The
Securities have been duly authorized and, when issued and paid for,
will
be validly issued, fully paid and non-assessable; the holders thereof
are
not and will not be subject to personal liability by reason of being
such
holders. The Securities are not and will not be subject to the preemptive
rights of any holders of any security of the Company arising by operation
of law or under the Certificate of Incorporation or Bylaws of the
Company.
When issued, the Representative’s Purchase Option, the Representative’s
Warrants and the Warrants will constitute valid and binding obligations
of
the Company to issue and sell, upon exercise thereof and payment
therefor,
the number and type of securities of the Company called for thereby
and
such Warrants, the Representative’s Purchase Option, and the
Representative’s Warrants, when issued, in each case, are enforceable
against the Company in accordance with their respective terms, except
(a)
as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally, (b)
as enforceability of any indemnification or contribution provision
may be
limited under the Federal and state securities laws, and (c) that
the
remedy of specific performance and injunctive and other forms of
equitable
relief may be subject to the equitable defenses and to the discretion
of
the court before which any proceeding therefor may be brought. The
certificates representing the Securities are in due and proper
form.
|
|
4.
|
The
Placement Warrants constitute valid and binding obligations of the
Company
to issue and sell, upon exercise thereof and payment therefor, the
number
and type of securities of the Company called for thereby, and such
Placement Warrants are enforceable against the Company in accordance
with
their respective terms, except: (i) as such enforceability may be
limited
by bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally; (ii) as enforceability of any indemnification
or contribution provision may be limited under federal and state
securities laws; and (iii) that the remedy of specific performance
and
injunctive and other forms of equitable relief may be subject to
the
equitable defenses and to the discretion of the court before which
any
proceeding therefor may be brought. A sufficient number of shares
of
Common Stock have been reserved for issuance upon exercise of the
Placement Warrants. The shares of Common Stock underlying the Placement
Warrants will, upon exercise of the Warrants and payment of the exercise
price thereof, be duly and validly issued, fully paid and non-assessable
and will not have been issued in violation of or subject to preemptive
or,
to such counsel’s knowledge, similar rights that entitle or will entitle
any person to acquire any securities from the Company upon issuance
thereof.
|
-44-
|
5.
|
This
Agreement, the Warrant Agreement, the Services Agreement, the Trust
Agreement, the Escrow Agreement and the Subscription Agreement have
each
been duly and validly authorized and, when executed and delivered
by the
Company, constitute, and the Representative’s Purchase Option has been
duly and validly authorized by the Company and, when executed and
delivered, will constitute, the valid and binding obligations of
the
Company, enforceable against the Company in accordance with their
respective terms, except (a) as such enforceability may be limited
by
bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally, (b) as enforceability of any indemnification
or contribution provisions may be limited under the Federal and state
securities laws, and (c) that the remedy of specific performance
and
injunctive and other forms of equitable relief may be subject to
the
equitable defenses and to the discretion of the court before which
any
proceeding therefor may be brought.
|
|
6.
|
The
execution, delivery and performance of this Agreement, the Warrant
Agreement, the Representative’s Purchase Option, the Escrow Agreement, the
Trust Agreement, the Services Agreement and the Subscription Agreement
and
compliance by the Company with the terms and provisions thereof and
the
consummation of the transactions contemplated thereby, and the issuance
and sale of the Securities, do not and will not, with or without
the
giving of notice or the lapse of time, or both, (a) to such counsel’s
knowledge, conflict with, or result in a breach of, any of the terms
or
provisions of, or constitute a default under, or result in the creation
or
modification of any lien, security interest, charge or encumbrance
upon
any of the properties or assets of the Company pursuant to the terms
of,
any mortgage, deed of trust, note, indenture, loan, contract, commitment
or other agreement or instrument filed as an exhibit to the Registration
Statement, (b) result in any violation of the provisions of the
Certificate of Incorporation or the Bylaws of the Company, or (c)
to such
counsel’s knowledge, violate any United States statute or any judgment,
order or decree, rule or regulation applicable to the Company of
any
court, United States Federal, state or other regulatory authority
or other
governmental body having jurisdiction over the Company, its properties
or
assets.
|
|
7.
|
The
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
and any post-effective amendments or supplements thereto (other than
the
financial statements included therein, as to which no opinion need
be
rendered) each as of their respective dates appeared on their face
to
comply as to form in all material respects with the requirements
of the
Act and Regulations. The Securities and all other securities issued
or
issuable by the Company conform in all material respects to the
description thereof contained in the Registration Statement and the
Prospectus. The descriptions in the Registration Statement, the Sale
Preliminary Prospectus and in the Prospectus, insofar as such statements
constitute a summary of statutes, legal matters, contracts, documents
or
proceedings referred to therein, fairly present in all material respects
the information required to be shown with respect to such statutes,
legal
matters, contracts, documents and proceedings, and such counsel does
not
know of any statutes or legal or governmental proceedings required
to be
described in the Sale Preliminary Prospectus and the Prospectus that
are
not described in the Registration Statement, the Sale Preliminary
Prospectus or the Prospectus or included as exhibits to the Registration
Statement that are not described or included as
required.
|
-45-
|
8.
|
The
Registration Statement is effective under the Act. To such counsel’s
knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have
been
instituted or are pending or threatened under the Act or applicable
state
securities laws.
|
|
9.
|
The
Company is not and, after giving effect to the offering and sale
of the
Securities and the application of the proceeds thereof as described
in the
Registration Statement and the Prospectus, will not be, an “investment
company” as defined in the Investment Company Act of 1940, as
amended.
|
|
10.
|
To
such counsel’s knowledge, there is no action, suit or proceeding before or
by any court of governmental agency or body, domestic or foreign,
now
pending, or threatened against the Company that is required to be
described in the Registration
Statement.
|
The
opinion of counsel shall further include a statement to the effect that such
counsel has participated in conferences with officers and other representatives
of the Company, the Underwriters and the independent registered public
accounting firm of the Company, at which conferences the contents of the
Registration Statement, the Sale Preliminary Prospectus and the Prospectus
contained therein and related matters were discussed and, although such counsel
is not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Sale Preliminary Prospectus and the Prospectus contained therein
(except as otherwise set forth in the foregoing opinion), solely on the basis
of
the foregoing without independent check and verification, no facts have come
to
the attention of such counsel which lead them to believe that the Registration
Statement or any amendment thereto, at the time the Registration Statement
or
amendment became effective, contained an untrue statement of a material fact
or
omitted to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading or the Prospectus or any amendment
or
supplement thereto, at the time they were filed pursuant to Rule 424(b) or
at
the date of such counsel’s opinion, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statement therein, in light of the circumstances under
which they were made, not misleading (except that such counsel need express
no
opinion with respect to the financial information and statistical data and
information included in the Registration Statement, the Sale Preliminary
Prospectus or the Prospectus).
-46-
EXHIBIT
A
FORM
OF TARGET BUSINESS LETTER
Camden
Learning Corporation
Gentlemen:
Reference
is made to the Final Prospectus of Camden Learning Corporation (the “
Company”),
dated
, 2007
(the “ Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in Prospectus.
We
have
read the Prospectus and understand that the Company has established the Trust
Account, initially in an amount of at least $
for the
benefit of the Public Stockholders and the Underwriters of the Company’s initial
public offering (the “ Underwriters”)
and
that, except for a portion of the interest earned on the amounts held in the
Trust Account, the Company may disburse monies from the Trust Account only:
(i)
to the Public Stockholders in the event they elect to redeem their IPO Shares,
(ii) to the Public Stockholders upon the liquidation of the Company if the
Company fails to consummate a Business Combination or (iii) to the Company
and
the Underwriters after or concurrently with the consummation of a Business
Combination.
For
and
in consideration of the Company agreeing to evaluate the undersigned for
purposes of consummating a Business Combination with it, the undersigned hereby
agrees that it does not have any right, title, interest or claim of any kind
in
or to any monies in the Trust Account (each, a “ Claim”)
and
hereby waives any Claim it may have in the future as a result of, or arising
out
of, any negotiations, contracts or agreements with the Company and will not
seek
recourse against the Trust Account for any reason whatsoever.
Authorized
Signature of Target Business
EXHIBIT
B
FORM
OF VENDOR LETTER
Camden
Learning Corporation
Gentlemen:
Reference
is made to the Final Prospectus of Camden Learning Corporation (the “
Company”),
dated
, 2007
(the “ Prospectus”).
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in Prospectus.
We
have
read the Prospectus and understand that the Company has established the Trust
Account, initially in an amount of at least $
for the
benefit of the Public Stockholders and the Underwriters of the Company’s initial
public offering (the “ Underwriters”)
and
that, except for a portion of the interest earned on the amounts held in the
Trust Account, the Company may disburse monies from the Trust Account only:
(i)
to the Public Stockholders in the event they elect to redeem their IPO Shares,
(ii) to the Public Stockholders upon the liquidation of the Company if the
Company fails to consummate a Business Combination or (iii) to the Company
and
the Underwriters after or concurrently with the consummation of a Business
Combination.
For
and
in consideration of the Company agreeing to engage the services of the
undersigned, the undersigned hereby agrees that it does not have any right,
title, interest or claim of any kind in or to any monies in the Trust Account
(each, a “ Claim”)
and
hereby waives any Claim it may have in the future as a result of, or arising
out
of, any services provided to the Company and will not seek recourse against
the
Trust Account for any reason whatsoever.