EX-1.1
MEDIA & ENTERTAINMENT HOLDINGS, INC.
UNDERWRITING AGREEMENT
New York, New York 2007
Lazard Capital Markets LLC
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▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladenburg ▇▇▇▇▇▇▇▇ & Co. Inc.
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▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned, Media & Entertainment Holdings, Inc., a Delaware corporation
("COMPANY"), hereby confirms its agreement with Lazard Capital Markets LLC
(being referred to herein variously as "YOU", "LAZARD" or the
"CO-REPRESENTATIVE" and with Ladenburg ▇▇▇▇▇▇▇▇ & Co. Inc. (being referred to
herein variously as "YOU," "LADENBURG" or the "CO-REPRESENTATIVE") and with the
other underwriters named on Schedule I hereto for which Lazard and Ladenburg are
acting as Co-Representatives (the Co-Representatives 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 10,800,000 units ("FIRM UNITS") of the Company, at
a purchase price (net of discounts and commissions) of $7.44 per Firm Unit
(including discounts of $0.20 per Firm Unit payable to the Underwriters, as well
as the full amount of a $864,000 non-accountable expense allowance payable to
the Co-Representatives that will not be paid to the Underwriters unless and
until a Business Combination (as defined below) has been consummated by the
Company). The Underwriters, severally and not jointly, agree that they will not
seek payment of the discounts of $0.20 or the $864,000 non-accountable expense
allowance referred to in Section 3.13.2 unless and until a Business Combination
has been consummated by the Company, and the Company agrees that it shall pay
such discounts and commissions only upon consummation of such Business
Combination. 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(S)"). 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
Co-Representatives inform the Company of their decision to allow earlier
separate trading, but in no event will the Co-Representatives allow separate
trading until (i) the preparation of an audited balance sheet of the Company
reflecting receipt by the Company of the proceeds of the Offering and the filing
of a Current Report on Form 8-K with the Securities and Exchange Commission (the
"COMMISSION") by the Company which includes such balance sheet and (ii) at least
five days have passed since the distribution of the Units (as defined below) in
the Offering has been completed. Each Warrant entitles its holder to exercise it
to purchase one share of Common Stock for $5.00 during the period commencing on
the later of the consummation by the Company of its Business Combination or one
year from the Effective Date 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 an operating business (as described more fully in the
Registration Statement).
1. 1.2 PAYMENT AND DELIVERY. Delivery and payment for the Firm Units shall be
made at 10:00 A.M., New York time, on the third business day following the
Effective Date (or the fourth business day following the Effective Date, if the
Registration Statement is declared effective after 4:30 p.m.) or at such earlier
time as shall be agreed upon by the Co-Representatives and the Company at the
offices of one of the Co-Representatives or at such other place as shall be
agreed upon by the Co-Representatives 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 Co-Representatives'
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: Some of
the proceeds received by the Company for the Firm Units shall be deposited in
the trust fund established by the Company for the benefit of the public
stockholders as described in the Registration Statement ("TRUST FUND") pursuant
to the terms of an Investment Management Trust Agreement ("TRUST AGREEMENT") and
the remaining proceeds shall be paid (subject to Section 3.13 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 Co-Representatives may request in writing
at least two full business days prior to the Closing Date. The Company will
permit the Co-Representatives 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 Co-Representatives for all the Firm Units.
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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 1,620,000 units from the Company ("OVER-ALLOTMENT OPTION"). Such
additional 1,620,000 units 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 Co-Representatives 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 Co-Representatives, 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 as shall
be agreed upon by the Company and the Co-Representatives, at the offices of one
of the Co-Representatives or at such other place as shall be agreed upon by the
Company and the Co-Representatives. 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 Co-Representatives' 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: $7.64 per Option Unit (reflecting the
deduction of discounts) shall be deposited in the Trust Fund pursuant to the
Trust Agreement 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 Co Representatives request 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 Co-Representatives 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.
1.3. CO-REPRESENTATIVES' PURCHASE OPTION.
1.3.1 PURCHASE OPTION. The Company hereby agrees to issue and sell to the
Co-Representatives (and/or their designees) on the Effective Date an option
("CO-REPRESENTATIVES' PURCHASE OPTION") for the purchase of an aggregate of
540,000
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units ("CO-REPRESENTATIVES' UNITS") for an aggregate purchase price of $100.
Each of the Co-Representatives' Units is identical to the Firm Units, except
that the warrants contained within the Co-Representatives' Units (the
"CO-REPRESENTATIVES' WARRANTS") have an exercise price of $7.50 per share of
Common Stock. The Co-Representatives' 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
Co-Representatives' Unit of $10.00 (125% of the initial public offering price of
a Unit). The Co-Representatives' Purchase Option, the Co-Representatives' Units,
the Co-Representatives' Warrants and the shares of Common Stock issuable upon
exercise of the Co-Representatives' Warrants are hereinafter referred to
collectively as the "CO-REPRESENTATIVES' SECURITIES." The Public Securities and
the Co-Representatives' Securities are hereinafter referred to collectively as
the "SECURITIES." The Co-Representatives understand and agree that there are
significant restrictions against transferring the Co-Representatives' Purchase
Option during the first year after the Effective Date, as set forth in Section 3
of the Co-Representatives' Purchase Option.
1.3.2 PAYMENT AND DELIVERY. Delivery and payment for the Co-Representatives'
Purchase Option shall be made on the Closing Date. The Company shall deliver to
the Underwriters, upon payment therefor, certificates for the
Co-Representatives' Purchase Option in the name or names and in such authorized
denominations as the Co-Representatives 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. 333-128218), including any related preliminary prospectus included in the
Registration Statement (as defined below) immediately prior to the Applicable
Time (as defined below) ("PRELIMINARY PROSPECTUS"), for the registration of the
Public 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 ("REGULATIONS") of the Commission under the Act. Except as the
context may otherwise require, such registration statement, as amended, on file
with the Commission at the time the registration statement 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 paragraph
(b) of 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 with the Commission pursuant to Rule 424 of the Regulations),
is hereinafter called the "PROSPECTUS." The Registration Statement has been
declared effective by the Commission on the date hereof.
2.1.2 PURSUANT TO THE EXCHANGE ACT. The Company has filed with the Commission a
Form 8-A (File Number 000-33343) providing for the registration under the
Securities Exchange Act of 1934, as amended ("EXCHANGE ACT"), of the Units, the
Common Stock and the
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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
Preliminary 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.
2.3.1 10B-5 REPRESENTATION. At the time the Registration Statement became
effective and as of the Closing Date or the Option Closing Date, as the case may
be, the Registration Statement and the Prospectus does 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; neither the Registration Statement
nor the Prospectus, nor any amendment or supplement thereto, on such dates, 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 as of the Applicable Time (as defined below) and when any 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 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
Co-Representatives expressly for use in the Registration Statement or Prospectus
or any amendment thereof or supplement thereto. "Applicable Time" means [5:00]
p.m. (New York time) on the date of this Agreement.
2.3.2 DISCLOSURE OF AGREEMENTS. The agreements and documents described in the
Registration Statement, the 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
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 Preliminary Prospectus
or 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
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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.
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, the
Preliminary Prospectus and the 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 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 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 material 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 ("M&K"), whose report is
filed with the Commission as part of the Registration Statement, are independent
accountants as required by the Act and the Regulations. M&K has not, during the
periods covered by the financial statements included in the Prospectus, provided
to the Company any non-audit services, as such term is used in Section 10A(g) of
the Exchange Act.
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2.6. FINANCIAL STATEMENTS. The financial statements, including the notes thereto
and supporting schedules included in the Registration Statement, the Preliminary
Prospectus and 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; and such financial statements have been prepared in conformity
with United States generally accepted accounting principles, consistently
applied throughout the periods involved; and the supporting schedules included
in the Registration Statement, the Preliminary Prospectus and the Prospectus,
present fairly the information required to be stated therein. The Registration
Statement, the 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.
2.7. AUTHORIZED CAPITAL; OPTIONS; ETC. The Company had at the date or dates
indicated in the Preliminary Prospectus and the Prospectus duly authorized,
issued and outstanding capitalization as set forth in the Registration
Statement, the Preliminary Prospectus and the Prospectus. Based on the
assumptions stated in the Registration Statement, the 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 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 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 conforms to all
statements relating thereto contained in the Registration Statement, the
Preliminary Prospectus and the Prospectus. The offers and sales of the
outstanding Common Stock were at all relevant times either registered under the
Act and the applicable state securities or Blue Sky laws or, based in part on
the representations and warranties of the purchasers of such shares of Common
Stock, are 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 in accordance with this Agreement, will
be validly issued, fully paid and non-assessable; the holders thereof are not
and will not be subject to personal liability by reason of being such holders;
the 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,
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issuance and sale of the Securities has been duly and validly taken. The
Securities conform in all material respects to all statements with respect
thereto contained in the Registration Statement, the Preliminary Prospectus and
the Prospectus. When issued, the Co-Representatives' Purchase Option, the
Co-Representatives' Warrants and the Warrants 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
Co-Representatives' Purchase Option, the Co-Representatives' Warrants and the
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 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.
2.9. REGISTRATION RIGHTS OF THIRD PARTIES. Except as set forth in the
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 2.20 hereof), the Trust Agreement, the Services
Agreement (as defined in Section 3.7.2 hereof), the Escrow Agreement (as defined
in Section 2.21.2 hereof) and the Registration Rights Agreement (as defined in
Section 2.21.3 hereof) have been duly and validly authorized by the Company and
constitute, and the Co-Representatives' Purchase Option has been duly and
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.
2.11. NO CONFLICTS, ETC. The execution, delivery, and performance by the Company
of this Agreement, the Warrant Agreement, the Co-Representatives' Purchase
Option, the Trust Agreement, the Services Agreement and the Escrow 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 2.22 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
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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 purpose as
described in the Preliminary Prospectus and the Prospectus. The disclosures in
the Registration Statement, the 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.
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 Co-Representatives' Purchase Option, the Trust
Agreement and the Escrow Agreement and as contemplated by the Prospectus, except
with respect to applicable federal and state securities laws.
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 immediately prior to the Offering ("INITIAL
STOCKHOLDERS") and provided to the Underwriters as an exhibit to his or her
Insider Letter (as defined in Section 2.21.1) 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 Initial
Stockholder to become inaccurate and incorrect.
2.15. LITIGATION; GOVERNMENTAL PROCEEDINGS. There is no action, suit,
proceeding, inquiry, arbitration, investigation, litigation or governmental
proceeding pending or, to the best of the Company's knowledge, threatened
against, or involving the Company or, to the best of the
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Company's knowledge, any Initial Stockholder, which has not been disclosed in
the Registration Statement, the Preliminary Prospectus, the Prospectus and 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. TRANSACTIONS AFFECTING DISCLOSURE TO NASD.
2.17.1 FINDER'S FEES. Except as described in the Preliminary Prospectus and the
Prospectus, there are no claims, payments, arrangements, agreements or
understandings relating to the payment of a finder's, consulting or origination
fee by the Company or any Initial Stockholder with respect to the sale of the
Securities hereunder or any other arrangements, agreements or understandings of
the Company or, to the best of the Company's knowledge, any Initial Stockholder
that may affect the Underwriters' compensation, as determined by the National
Association of Securities Dealers, Inc. ("NASD").
2.17.2 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 Underwriters.
2.17.3 USE OF PROCEEDS. None of the net proceeds of the Offering 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 Preliminary Prospectus and the
Prospectus.
2.17.4 INSIDERS' NASD AFFILIATION. Based on the Questionnaires, except as set
forth on Schedule 2.17.4, 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. The Company will advise the Co-Representatives
and their counsel if it learns that any officer, director or beneficial owner of
at least 5% of the Company's outstanding Common Stock is or becomes an affiliate
or associated person of an NASD member.
2.18. FOREIGN CORRUPT PRACTICES ACT. Neither the Company nor any of the Initial
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
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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
Preliminary Prospectus or 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. 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.
2.20. WARRANT AGREEMENT. The Company has entered into a warrant agreement with
respect to the Warrants and the Co-Representatives' Warrants with
Continental Stock Transfer & Trust Company substantially in the form annexed as
Exhibit 4.5 to the Registration Statement ("WARRANT AGREEMENT").
2.21. AGREEMENTS WITH INITIAL STOCKHOLDERS.
2.2 1.1 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, 10.2, 10.3, 10.4 and 10.25 to the
Registration Statement ("INSIDER LETTERS"), pursuant to which each of the
Initial 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 Prospectus.
2.21.2 ESCROW AGREEMENT. The Company and the Initial Stockholders have entered
into an escrow agreement ("ESCROW AGREEMENT") with American Stock Transfer &
Trust Company ("ESCROW AGENT") substantially in the form annexed as Exhibit 10.2
to the Registration Statement, whereby the Common Stock owned by the Initial
Stockholders will be held in escrow by the Escrow Agent, until the first
anniversary of the Business Combination. During such escrow period, the Initial
Stockholders shall be prohibited from selling or otherwise transferring such
shares (except to spouses and children of Initial 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 Initial
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 Initial Stockholders is a party. The Escrow Agreement shall not
be amended, modified or otherwise changed without the prior written consent of
the Co-Representatives.
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2.21.3 REGISTRATION RIGHTS AGREEMENT. The Company and the Initial Stockholders
have entered into a registration rights agreement ("REGISTRATION RIGHTS
AGREEMENT") substantially in the form annexed as Exhibit 10.11 to the
Registration Statement, whereby the Initial Stockholders will be entitled to
certain registration rights as set forth in such Registration Rights Agreement
and described more fully in the Registration Statement.
2.22. 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 10.1 to the Registration Statement.
2.23. COVENANTS NOT TO COMPETE. No Initial Stockholder, employee, officer or
director of the Company is subject to any noncompetition agreement or
non-solicitation agreement with any employer or prior employer which could
materially affect his ability to be an Initial Stockholder, employee, officer
and/or director of the Company.
2.24. INVESTMENT COMPANY ACT; INVESTMENTS. The Company has been advised
concerning the Investment Company Act of 1940, as amended (the "INVESTMENT
COMPANY ACT"), and the rules and regulations thereunder and has in the past
conducted, and intends in the future to conduct, its affairs in such a manner as
to ensure that it will not become an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act and such rules and regulations. The Company is not, nor will the
Company become upon the sale of the Units and the application of the proceeds
therefore as described in the Prospectus under the caption "Use of Proceeds", an
"investment company" or a person controlled by an "investment company" within
the meaning of the Investment Company Act. No more than 45% of the "value" (as
defined in Section 2(a)(41) of the Investment Company Act) of the Company's
total assets (exclusive of cash items and "Government Securities" (as defined in
Section 2(a)(16) of the Investment Company Act) consist of, and no more than 45%
of the Company's net income after taxes is derived from, securities other than
the Government Securities.
2.25. SUBSIDIARIES. The Company does not own an interest in any corporation,
partnership, limited liability company, joint venture, trust or other business
entity.
2.26. 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 Preliminary Prospectus and the Prospectus that have not been
described as required.
2.27. LOANS. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.,
▇▇▇▇▇ ▇▇▇▇▇▇ and Transmedia Corporation have made loans to the Company in the
aggregate amount of $300,000 (the "INSIDER LOANS") substantially in the form
annexed as Exhibits 10.5, 10.6, 10.7, 10.8, 10.15, 10.16, 10.17, 10.18, 10.19,
10.20, 10.21, 10.34, 10.35, 10.36, 10.37, 10.38, 10.39, 10.40, 10.41, 10.47,
10.48, 10.49 and 10.50 to the Registration Statement. The Insider Loans do not
bear any interest and are repayable by the Company on the earlier to occur of
(i) one year, eighteen or twenty-four months from the date of the loan, as set
forth in the applicable exhibit or (ii) the date on which the Company
consummates an initial public offering of its securities.
2.28. AMERICAN STOCK EXCHANGE ELIGIBILITY. As of the Effective Date, the Public
Securities have been approved for listing on the American Stock Exchange
("AMEX").
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3. COVENANTS OF THE COMPANY. The Company covenants and agrees as follows:
3.1. AMENDMENTS TO REGISTRATION STATEMENT. The Company will deliver to the
Co-Representatives, prior to filing, any amendment or supplement to the
Registration Statement or Prospectus proposed to be filed after the Effective
Date and not file any such amendment or supplement to which the
Co-Representatives shall reasonably object in writing.
3.2. FEDERAL SECURITIES LAWS.
3.2.1 COMPLIANCE. During the time when a Prospectus is required to be delivered
under the Act, the Company will use all reasonable efforts to comply with all
requirements imposed upon it by the Act, the Regulations and the Exchange Act
and by the regulations under the Exchange Act, as from time to time in force, so
far as necessary to permit the continuance of sales of or dealings in the Public
Securities in accordance with the provisions hereof and the Prospectus. If at
any time when a Prospectus relating to the Public Securities is required to be
delivered under the Act, any event shall have occurred as a result of which, in
the opinion of counsel for the Company or counsel for the Underwriters, the
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 Prospectus to comply with the Act, the Company will notify the
Co-Representatives 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 Co-Representatives) 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 Units, Common Stock and Warrants under the
provisions of the Exchange Act 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 Units, Common Stock or Warrants under the
Exchange Act without the prior written consent of the Co-Representatives.
3.3. BLUE SKY FILINGS. The Company will endeavor in good faith, in cooperation
with the Co-Representatives, at or prior to the time the Registration Statement
becomes effective, to qualify the Public Securities for offering and sale under
the securities laws of such jurisdictions as the Co-Representatives 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 Co-Representatives agree 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.
-13-
3.4. DELIVERY TO UNDERWRITERS OF 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 and the 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 all original executed consents of
certified experts.
3.5. EFFECTIVENESS AND EVENTS REQUIRING NOTICE TO THE CO-REPRESENTATIVES. The
Company will use its best efforts to cause the Registration Statement to remain
effective and will notify the Co-Representatives 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 3.4 hereof that, in the judgment of the Company, makes any statement
of a material fact made in the Registration Statement or the Prospectus untrue
or that requires the making of any changes in the Registration Statement, the
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.
3.6. REVIEW OF FINANCIAL STATEMENTS. 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, at its expense, shall cause its regularly engaged
independent certified public accountants to review (but not audit) the Company's
financial statements for each of the first three fiscal quarters prior to the
announcement of quarterly financial information, the filing of the Company's
Form 10-Q quarterly report and the mailing of quarterly financial information to
stockholders.
3.7. AFFILIATED TRANSACTIONS.
3.7.1 BUSINESS COMBINATIONS. The Company will not consummate a Business
Combination with any entity which is affiliated with any Initial Stockholder. In
connection with any Business Combination, the Company will obtain from each of
its Initial Stockholders a certificate, sworn to under penalty of perjury,
confirming that none of such individuals has any affiliation, whether directly
or indirectly, with respect to the potential target business for such Business
Combination. Such certificates will be included in the Current Report on Form
8-K filed by the Company with the SEC announcing the signing of a definitive
agreement for such Business Combination. Furthermore, the Company will not
consummate any Business Combination unless the Company obtains an opinion from
an independent investment banking
-14-
firm that the Business Combination is fair to the Company's stockholders from a
financial perspective.
3.7.2 ADMINISTRATIVE SERVICES. The Company has entered into an agreement
("SERVICES AGREEMENT") with Transmedia Corporation ("TRANSMEDIA") substantially
in the form annexed as Exhibit 10.11 to the Registration Statement pursuant to
which Transmedia will make available to the Company administrative, technology
and secretarial services, as well as the use of certain limited office space, in
Dallas, Texas for $7,500 per month.
3.7.3. COMPENSATION. Except for the repayment of the Insider Loans, the Company
shall not pay any Initial Stockholder or any of their affiliates any fees or
compensation for services rendered to the Company, prior to, or in connection
with, the consummation of a Business Combination; provided that the Initial
Stockholders shall be entitled to reimbursement from the Company for their
reasonable out-of-pocket expenses incurred in connection with seeking and
consummating a Business Combination.
3.8. SECONDARY MARKET TRADING AND STANDARD & POOR'S. If the Company does not
maintain the listing of the Public Securities on the AMEX or another national
securities exchange, 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. The Company shall also take such other
action as may be reasonably requested by the Co-Representatives to obtain a
secondary market trading exemption in such other states as may be requested by
the Co-Representatives.
3.9. INTENTIONALLY OMITTED.
3.10. 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 the Co-Representatives
for a term to be agreed upon by the Company and the Co-Representatives.
3.11. REPORTS TO THE CO-REPRESENTATIVES.
3.11.1 PERIODIC REPORTS, ETC. For a period of five years from the Effective Date
or until such earlier time upon which the Company is required to be liquidated,
the Company will furnish to the Co-Representatives (Attn: ▇▇▇▇▇ ▇. ▇▇▇▇ and
▇▇▇▇▇▇ ▇▇▇▇▇) and their counsel, as reasonably requested from time to time,
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 Co-Representatives 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 Co-Representatives may from time to
time reasonably request; PROVIDED that the Co-Representatives shall sign, if
requested by the Company, a
-15-
Regulation FD compliant confidentiality agreement which is reasonably acceptable
to the Co-Representatives and their counsel in connection with the
Co-Representatives' receipt of such information.
3.11.2 TRANSFER SHEETS. For a period of five years following the Effective Date
or until such earlier time upon which the Company is required to be liquidated,
the Company shall retain a transfer and warrant agent acceptable to the
Co-Representatives ("TRANSFER AGENT") and will furnish to the Underwriters at
the Company's sole cost and expense such transfer sheets of the Company's
securities as the Co-Representatives may request, including the daily and
monthly consolidated transfer sheets of the Transfer Agent and DTC. Continental
Stock Transfer & Trust Company is acceptable to the Underwriters.
3.11.3 TRADING REPORTS. During such time as the Public Securities are quoted on
the NASD OTC Bulletin Board (or any successor trading market) or the Pink
Sheets, LLC (or similar publisher of quotations) and no other automated
quotation system, the Company shall provide to the Co-Representatives, at their
expense, such reports published by the NASD or the Pink Sheets, LLC relating to
price trading of the Public Securities, as the Co-Representatives shall
reasonably request.
3.12. DISQUALIFICATION OF FORM S-3. 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-3 (or other appropriate form) for the registration
of the Warrants and the Co-Representatives' Warrants under the Act (except in
connection with a going private transaction).
3.13. PAYMENT OF EXPENSES.
3.13.1 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 the 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 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 Co-Representatives' Purchase Option, including any
transfer or other taxes payable thereon, (iii) the qualification of the Public
Securities under state or foreign securities or Blue Sky laws, including the
costs of preparing, printing and mailing the Preliminary Blue Sky Memorandum,
and all amendments and supplements thereto, fees and disbursements of
▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ LLP, counsel for the Underwriters
("▇▇▇▇▇▇▇▇▇▇▇") (such fees shall be $152,432.00 in the aggregate (of which $0.00
has previously been paid)), (iv) filing fees, costs and expenses (including
disbursements) incurred in registering the Offering with the NASD.(v) fees and
disbursements of the transfer and warrant agent, (vi) the Company's expenses
associated with "due diligence" meetings arranged by the Co-Representatives,
(vii) the preparation, binding and delivery of transaction "bibles," in form and
style reasonably satisfactory to the Co-
-16-
Representatives and transaction Lucite cubes or similar commemorative items in a
style and quantity as reasonably requested by the Co-Representatives 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 3.13.1. The Company also agrees that, if requested
by the Co-Representatives, it will engage and pay up to $[____] for an
investigative search firm of the Co-Representatives' choice to conduct an
investigation of the principals of the Company as shall be mutually selected by
the Co-Representatives and the Company. If the Offering is successfully
consummated, any such amounts paid to the search firm by the Company pursuant to
the immediately preceding sentence shall be credited against the
Co-Representatives' nonaccountable expense allowance (described below in Section
3.13.2). The Co-Representatives 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
Co-Representatives 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 and disbursements and "road show" and due diligence
expenses. The Co-Representatives shall retain such part of the nonaccountable
expense allowance previously paid as shall equal its actual out-of-pocket
expenses and refund the balance. If the amount previously paid is insufficient
to cover such actual out-of-pocket expenses, subject to the preceding sentences,
the Company shall remain liable for and promptly pay any other actual
out-of-pocket expenses.
3.13.2 NONACCOUNTA13LE EXPENSES. The Company agrees that, in addition to the
expenses payable pursuant to Section 3.13.1, it will pay the Co-Representatives,
upon consummation of a Business Combination, an additional cash fee equal to 1%
of the gross proceeds received by the Company from the sale of the Firm Units
representing a nonaccountable expense allowance due to the Co-Representatives;
provided, however, that (a) in the event a Business Combination is not
consummated, such fees will be returned to the Company prior to its liquidation
or (b) in the event a Business Combination is consummated, such fees will be
credited against the amount due to the Co-Representatives upon consummation of
such Business Combination.
3.14. APPLICATION OF NET PROCEEDS. The Company will apply the net proceeds from
the Offering received by it in a manner consistent with the application
described under the caption "Use Of Proceeds" in the Prospectus.
3.15. 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.
3.16. 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
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the NASD and the Co-Representatives 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.
3.17. STABILIZATION. Neither the Company, nor, to its knowledge, any of its
employees, directors or stockholders (without the consent of the
Co-Representatives) has taken or will take, directly or indirectly, any action
designed to or that has constituted or that might reasonably be expected to
cause or result in, under the Exchange Act, or otherwise, stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Units.
3.18. 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.
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 M&K or another independent public accountant reasonably
acceptable to the Co-Representatives.
3.20. FORM 8-K. The Company shall, on the date hereof, retain its independent
public accountants to audit the financial statements of the Company as of the
Closing Date ("AUDITED FINANCIAL STATEMENTS") reflecting the receipt by the
Company of the proceeds of the initial public offering. As soon as the Audited
Financial Statements become available, the Company shall immediately file a
Current Report on Form 8-K with the Commission, which Report shall contain the
Company's Audited Financial Statements.
3.21. 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.
3.22. CORPORATE PROCEEDINGS. All corporate proceedings and other legal matters
necessary to carry out the provisions of this Agreement and the transactions
contemplated hereby shall have been done to the reasonable satisfaction to
counsel for the Underwriters.
3.23. INVESTMENT COMPANY. The Company shall cause a portion of the proceeds of
the Offering to be held in the Trust Fund to be invested as set forth in the
Trust Agreement and as
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more fully described in the Prospectus. The Company will otherwise conduct its
business in a manner so that it will not become subject to the Investment
Company Act. Furthermore, once the Company consummates a Business Combination,
it will be engaged in a business other than that of investing, reinvesting,
owning, holding or trading securities.
3.24. INSIDER WARRANTS. The Company hereby acknowledges and agrees that, in the
event the Company calls the Warrants for redemption pursuant to the Warrant
Agreement, any Warrants that may be purchased by the Company Warrant Purchasers
pursuant to the Warrant Purchase Letters may be exercised by the Company Warrant
Purchasers by surrendering the Warrant for that number of shares of Common Stock
equal to the quotient obtained by dividing (x) the product of the number of
shares of Common Stock underlying the Warrant, multiplied by the difference
between the Warrant Price and the "Fair Market Value" (defined below) by (y) the
Fair Market Value. The "Fair Market Value" shall mean the average reported last
sale price of the Common Stock for the 10 trading days ending on the third
business day prior to the date on which the notice of redemption is sent to
holders of Warrant.
3.25. AMEX MAINTENANCE. Until the consummation of a Business Combination, the
Company will use commercially reasonable efforts to maintain the listing by the
AMEX of the Securities.
3.26. 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. Such announcement shall describe the consummation of
the Business Combination and indicate that the Co-Representatives were the
managing underwriter in the Offering. The Company shall supply the
Co-Representatives with a draft of the Business Combination Announcement and
provide the Co-Representatives with a reasonable opportunity to comment thereon.
The Company will not place the Business Combination Announcement without the
final approval of the Co-Representatives, which such approval will not be
unreasonably withheld.
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 that purpose shall have been instituted or shall
be pending or contemplated by the Commission and any request on the part of the
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Commission for additional information shalt have been complied with to the
reasonable satisfaction of ▇▇▇▇▇▇▇▇▇▇▇.
4.1.2 NASD CLEARANCE. By the Effective Date, the Co-Representatives 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.
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 3.3 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.
4.2. COMPANY COUNSEL MATTERS.
4.2.1 EFFECTIVE DATE OPINION OF COUNSEL. On the Effective Date, the
Co-Representatives shall have received the favorable opinion of ▇▇▇▇▇▇▇▇▇
Traurig, LLP ("▇▇▇▇▇▇▇▇▇"), dated the Effective Date, addressed to the
Co-Representatives and in form and substance satisfactory to ▇▇▇▇▇▇▇▇▇▇▇ to the
effect that:
(i) 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;
(ii) All issued and outstanding securities of the Company 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
outstanding capital stock of the Company is as set forth in the Prospectus;
(iii) 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 Co-Representatives' Purchase Option, the Co-Representatives' 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
Co-Representatives' Purchase Option, and the Co-Representatives' 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
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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;
(iv) This Agreement, the Warrant Agreement, the Trust Agreement, the Escrow
Agreement and the Registration Rights Agreement have each been duly and validly
authorized, executed and delivered by the Company and constitute, and the
Co-Representatives' 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;
(v) The execution, delivery and performance of this Agreement, the Warrant
Agreement, the Co-Representatives' Purchase Option, the Escrow Agreement, the
Trust Agreement, the Services Agreement, and the Registration Rights Agreement
and compliance by the Company with the terms and provisions hereof and thereof
and the consummation of the transactions contemplated hereby and 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;
(vi) The Registration Statement, each 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 complied 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 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 there
are no statutes or legal or governmental proceedings required to be described in
the Prospectus that are not described in the
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Registration Statement or the Prospectus or included as exhibits to the
Registration Statement that are not described or included as required;
(vii) 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;
(viii) 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; and
(ix) 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 public
accountants of the Company, at which conferences the contents of the
Registration Statement 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 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 (i) 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, (ii) the Preliminary Prospectus as of the Applicable Time,
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, and (iii) 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 statements and schedules and other financial and statistical data and
information included in the Registration Statement or the Prospectus).
4.2.2 CLOSING DATE AND OPTION CLOSING DATE OPINION OF COUNSEL. On each of the
Closing Date and the Option Closing Date, if any, the Co-Representatives shall
have received the favorable opinion of ▇▇▇▇▇▇▇▇▇, dated the Closing Date or the
Option Closing Date, as the case may be, addressed to the Co-Representatives and
in form and substance reasonably satisfactory to ▇▇▇▇▇▇▇▇▇▇▇, confirming as of
the Closing Date and, if applicable, the Option Closing Date, the statements
made by ▇▇▇▇▇▇▇▇▇ in its opinion delivered on the Effective Date.
4.2.3 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
-22-
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 Co-Representatives 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 M&K 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
Prospectus, provided to the Company any non-audit services, as such term is used
in Section l0A(g) of the Exchange Act;
(ii) Stating that in their opinion the financial statements of the Company
included in the Registration Statement and Prospectus comply as to form in all
material respects with the applicable accounting requirements of the Act and the
published Regulations thereunder;
(iii) Stating that, on the basis of a limited review which included a reading of
the latest available unaudited interim financial statements of the Company (with
an indication of the date of the latest available unaudited interim financial
statements), a reading of the latest available minutes of the stockholders and
board of directors and the various committees of the board of directors,
consultations with officers and other employees of the Company responsible for
financial and accounting matters and other specified procedures and inquiries,
nothing has come to their attention which would lead them to believe that (a)
the unaudited financial statements of the Company included in the Registration
Statement 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, (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 2006 balance sheet included in the
Registration Statement, other than as set forth in or contemplated by the
Registration Statement, or, if there was any decrease, setting forth the amount
of such decrease, and (c) during the period from 2006 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, or, if there was any such decrease,
setting forth the amount of such decrease;
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(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 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;
(vi) Stating that they have not during the immediately preceding five year
period 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 Co-Representatives 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 the 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
Co-Representatives will have received such other and further certificates of
officers (in their capacities as such) of the Company as the Co-Representatives
may reasonably request.
4.4.2 SECRETARY'S CERTIFICATE. At each of the Closing Date and the Option
Closing Date, if any, the Co-Representatives 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 Closing 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, (iv) all correspondence between the Company or its counsel and AMEX
concerning the listing of the Securities on AMEX and (v) as to the incumbency of
the officers of the Company. The documents referred to in such certificate shall
be attached to such certificate.
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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 Preliminary Prospectus and Prospectus, (ii) no
action suit or proceeding, at law or in equity, shall have been pending or
threatened against the Company or any Initial 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 and 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 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 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.
4.6. DELIVERY OF AGREEMENTS.
4.6.1 EFFECTIVE DATE DELIVERIES. On the Effective Date, the Company shall have
delivered to the Co-Representatives executed copies of the Escrow Agreement, the
Trust Agreement, the Warrant Agreement and all of the Insider Letters.
4.6.2 CLOSING DATE DELIVERIES. On the Closing Date, the Company shall have
delivered to the Co-Representatives executed copies of the Co-Representatives'
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.
5. INDEMNIFICATION.
5.1. INDEMNIFICATION OF UNDERWRITERS. 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
-25-
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, (collectively the
"UNDERWRITER INDEMNIFIED PARTIES," and each a "UNDERWRITER INDEMNIFIED PARTY")
against any loss, claim, damage, expense or liability whatsoever (or any action,
investigation or proceeding in respect thereof), joint or several, to which such
Underwriter Indemnified Party may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, expense, liability, action,
investigation or proceeding arises out of or is based upon (A) any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any Registration Statement or the Prospectus, or in any
amendment or supplement thereto or document incorporated by reference therein,
or (B) the omission or alleged omission to state in any Preliminary Prospectus,
any Registration Statement or the Prospectus, or in any amendment or supplement
thereto or document incorporated by reference therein, a material fact required
to be stated therein or necessary to make the statements therein not misleading
or (C) any breach of the representations and warranties of the Company contained
herein or failure of the Company to perform its obligations hereunder or
pursuant to any law, any act or failure to act, or any alleged act or failure to
act, by any Underwriter in connection with, or relating in any manner to, the
Securities or the Offering, and which is included as part of or referred to in
any loss, claim, damage, expense, liability, action, investigation or proceeding
arising out of or based upon matters covered by subclause (A), (B) or (C) of
this Section 5.1 (PROVIDED that the Company shall not be liable in the case of
any matter covered by this subclause (C) to the extent that it is determined in
a final judgment by a court of competent jurisdiction that such loss, claim,
damage, expense or liability resulted directly from any such act or failure to
act undertaken or omitted to be taken by such Underwriter through its gross
negligence or willful misconduct), and shall reimburse the Underwriter
Indemnified Party promptly upon demand for any legal fees or other expenses
reasonably incurred by that Underwriter Indemnified Party in connection with
investigating, or preparing to defend, or defending against, or appearing as a
third party witness in respect of, or otherwise incurred in connection with, any
such loss, claim, damage, expense, liability, action, investigation or
proceeding, as such fees and expenses are incurred; PROVIDED, HOWEVER, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage, expense or liability arises out of or is based upon an untrue
statement or alleged untrue statement in, or omission or alleged omission from
any Preliminary Prospectus, any Registration Statement or the Prospectus, or any
such amendment or supplement thereto, made in reliance upon and in conformity
with written information furnished to the Company by the Representative by or on
behalf of any Underwriter specifically for use therein. This indemnity agreement
is not exclusive and will be in addition to any liability, which the Company
might otherwise have and shall not limit any rights or remedies which may
otherwise be available at law or in equity to each Underwriter Indemnified
Party.
5.2. INDEMNIFICATION OF THE COMPANY. Each Underwriter, severally and not
jointly, shall indemnify and hold harmless the Company and its directors, its
officers who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act (collectively the "COMPANY INDEMNIFIED PARTIES" and each a
"COMPANY INDEMNIFIED PARTY") against any loss, claim, damage, expense or
liability whatsoever (or any action, investigation or proceeding in respect
thereof), joint or several, to which such Company Indemnified Party may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, expense, liability, action, investigation or proceeding arises out of or
is based upon (i) any untrue
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statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any Registration Statement or the Prospectus, or in any
amendment or supplement thereto, or (ii) the omission or alleged omission to
state in any Preliminary Prospectus, any Registration Statement or the
Prospectus, or in any amendment or supplement thereto, a material fact required
to be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by the
Representative by or on behalf of any Underwriter specifically for use therein.
Notwithstanding the provisions of this Section 5.2, in no event shall any
indemnity by a Underwriter under this Section 5.2 exceed the total compensation
received by such Underwriter in accordance with this Agreement.
5.1.2 PROCEDURE. If any action is brought against any Underwriter Indemnified
Party pursuant to Section 5.1, such Underwriter Indemnified Party shall promptly
notify the Company in writing of the institution of such action and the Company
shall assume the defense of such action, including the employment and fees of
counsel (subject to the reasonable approval of such Underwriter Indemnified
Party) and payment of actual expenses. Such Underwriter Indemnified Party shall
have the right to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such Underwriter
Indemnified Party unless (i) the employment of such counsel at the expense of
the Company shall have been authorized in writing by the Company in connection
with the defense of such action, or (ii) the Company shall not have employed
counsel to have charge of the defense of such action, or (iii) such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those
available to the Company (in which case the Company shall not have the right to
direct the defense of such action on behalf of the indemnified parry or
parties), in any of which events the reasonable fees and expenses of not more
than one additional firm of attorneys selected by the Underwriter Indemnified
Party shall be borne by the Company. Notwithstanding anything to the contrary
contained herein, if the Underwriter Indemnified Party shall assume the defense
of such action as provided above, the Company shall have the right to approve
the terms of any settlement of such action which approval shall not be
unreasonably withheld.
5.3. CONTRIBUTION.
5.3.1 CONTRIBUTION RIGHTS. In order to provide for just and equitable
contribution under the Act in any case in which (i) any person entitled to
indemnification under this Section 5 makes claim for indemnification pursuant
hereto but it is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that this Section 5 provides for
indemnification in such case, or (ii) contribution under the Act, the Exchange
Act or otherwise may be required on the part of any such person in circumstances
for which indemnification is provided under this Section 5, 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
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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 5.3.1, no Underwriter shall be
required to contribute any amount in excess of the total compensation received
by such Underwriter in accordance with this Agreement less the amount of any
damages which such Underwriter has otherwise paid or become liable to pay by
reason of any untrue or alleged untrue statement, omission or alleged omission,
act or alleged act or failure to act or alleged failure to act. 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.
5.3.2 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 parry 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 parry, 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.
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
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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 3.13 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 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 the Co-Representatives to the Company, the Co-Representatives
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 the Co-Representatives and their counsel in connection with such
representative's attendance at meetings of the Board of Directors; and provided
further that upon written notice to the Co-Representatives, 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 the Co-Representatives
written notice of each such meeting and to provide the Co-Representatives
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 the Co-Representatives for his or her reasonable
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out-of-pocket expenses incurred in connection with their attendance at the
meeting, including but not limited to, food, lodging and transportation.
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 or any options or other securities convertible into Common Stock, or any
shares of Preferred Stock which participate in any manner in the Trust Fund or
which vote as a class with the Common Stock on a Business Combination.
8.2. TRUST FUND WAIVER ACKNOWLEDGMENT.
(a) UNDERWRITERS/CO-REPRESENTATIVES. Except with respect to the underwriting
discounts and commissions and nonaccountable expense allowance due to the
Underwriters only upon successful consummation of a Business Combination, each
of the Underwriters and the Co-Representatives hereby agree that it does not
have any right, title, interest or claim of any kind in or to any monies in the
Trust Fund ("CLAIM"), including those funds being deposited in the Trust Fund
representing a portion of the underwriting discounts and commissions and the
Co-Representatives' nonaccountable expense allowance owed to the Underwriters
and Co-Representatives, and waive 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 Fund for any reason
whatsoever.
(b) TARGET BUSINESSES AND VENDORS. The Company hereby agrees that it will not
commence its due diligence investigation of any operating business which the
Company seeks to acquire (each a "TARGET BUSINESS") or obtain the services of
any vendor unless and until such Target Business or vendor acknowledges 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 Fund, initially in an
amount of S for the benefit of the public stockholders and that the Company may
disburse monies from the Trust Fund only (1) to the public stockholders in the
event they elect to convert their IPO Shares (as defined below in Section 7.6),
(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
after, or concurrently with, the consummation of a Business Combination and (b)
for and in consideration of the Company (1) agreeing to evaluate such Target
Business for purposes of consummating a Business Combination with it or (2)
agreeing to engage the services of the vendor, as the case may be, such Target
Business or vendor agrees that it does not have any Claim of any kind in or to
any monies in the Trust Fund 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 Fund for any reason
whatsoever.
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 and will not
allow any amendments to, or waivers of, such Insider Letters without the prior
written consent of the Co-Representatives.
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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
Co-Representatives.
8.5. BLUE SKY REQUIREMENTS. The Company shall provide counsel to the
Co-Representatives 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.
8.6. ACQUISITION/LIQUIDATION PROCEDURE. The Company agrees: (i) that, 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 applicable state law; (ii) that, in the event that
the Company does not effect a Business Combination within 18 months from the
consummation of this Offering (subject to extension for an additional six-month
period, as described in the Prospectus), the Company will be liquidated and will
distribute to all holders of IPO Shares (defined below) an aggregate sum equal
to the Company's Liquidation Value; and (iii) that this section 8.6 of the
Underwriting Agreement may not be modified, amended or deleted under any
circumstances. The Company's "LIQUIDATION VALUE" shall mean the Company's book
value, as determined by the Company and approved by M&K. In no event, however,
will the Company's Liquidation Value be less than the Trust Fund, inclusive of
any net interest income thereon. Only holders of IPO Shares shall be entitled to
receive liquidating distributions and the Company shall pay no liquidating
distributions with respect to any other shares of capital stock of the Company.
With respect to the Business Combination Vote, the Company shall cause all of
the Initial Stockholders to vote the shares of Common Stock owned by them
immediately prior to this Offering in accordance with the vote of the holders of
a majority of the IPO Shares present, in person or by proxy, at a meeting of the
Company's stockholders called for such purpose. At the time the Company seeks
approval of any potential Business Combination, the Company will offer each
holder of Common Stock issued in this Offering ("IPO SHARES") the right to
convert their IPO Shares at a per share price ("CONVERSION PRICE") equal to the
amount in the Trust Fund (inclusive of any interest income therein) calculated
as of two business days prior to the consummation of the proposed Business
Combination divided by the total number of IPO Shares. If holders of less than
20% in interest of the Company's IPO Shares elect to convert their IPO Shares,
the Company may, but will not be required to, proceed with such Business
Combination. If the Company elects to so proceed, it will convert shares, based
upon the Conversion Price, from those holders of IPO Shares who affirmatively
requested such conversion and who voted against the Business Combination. If
holders of 20% or more in interest of the IPO Shares, who vote against approval
of any potential Business Combination, elect to convert their IPO Shares, the
Company will not proceed with such Business Combination and will not convert
such shares.
8.7. 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
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outstanding securities from being deemed to be a "▇▇▇▇▇ stock" as defined in
Rule 3a-51-1 under the Exchange Act during such period.
8.8. AFFILIATED TRANSACTIONS. The Company shall cause each of the Initial
Stockholders to agree that, in order to minimize potential conflicts of interest
which may arise from multiple affiliations, the Initial 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 Initial Stockholders
cease to be an officer or director of the Company, subject to any pre-existing
fiduciary or contractual obligations the Initial Stockholders might have. To
further minimize potential conflicts of interest, the Company has agreed not to
consummate a Business Combination with an entity which is affiliated with any of
its executive officers and has agreed that it will not consummate any Business
Combination unless the Company obtains an opinion from an independent investment
banking firm that the business combination is fair to its unaffiliated
stockholders from a financial point of view.
8.9. TARGET NET ASSETS. The Company agrees that the initial Target Business that
it acquires must have a fair market value equal to at least 80% of the Company's
net assets (all of the Company's assets, including the funds held in the Trust
Fund, less the Company's liabilities) at the time of such acquisition. The fair
market value of such business must be determined by the Board of Directors of
the Company based upon standards generally accepted by the financial community,
such as actual and potential sales, earnings 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 fair market value of at least 80% of the
Company's net assets at the time of such acquisition, the Company will obtain an
opinion from an unaffiliated, independent investment banking firm which is a
member of the NASD reasonably acceptable to the Co-Representatives 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.
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
at the Closing Dates and such representations, warranties and agreements of the
Underwriters and Company, including the indemnity agreements contained in
Section 5 hereof, shall remain operative and in full force and effect regardless
of any investigation made by or on behalf of any Underwriter, the Company or any
controlling person, and shall survive termination of this Agreement or the
issuance and delivery of the 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.
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10.2. TERMINATION. You shall have the right to terminate this Agreement at any
time prior to any Closing Date, (i) if any domestic or international event or
act or occurrence has materially disrupted, or in 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 Stock 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 NASD OTC Bulletin Board or by order of the
Commission or any other government authority having jurisdiction, or
(iii) if the United States shall have become involved in a 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 and adversely impacts the
United States securities market, or (vi) if the Company shall have sustained a
material loss by fire, explosion, 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
Co-Representatives 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
Co-Representatives' 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 3.13 hereof.
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 affected 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 Co-Representatives:
Lazard Capital Markets LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-▇▇-
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇
Copy to (which shall not constitute notice):
▇▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
If to the Company:
Media & Entertainment Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman & CEO
Copy to:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. Annex, Esq.
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 Co-Representatives, the Underwriters, the Company and
the controlling persons, directors and officers referred to in Section 5 hereof,
and their respective successors,
34
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.
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 of 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 10.1 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.
11.7. EXECUTION IN COUNTERPARTS. This Agreement may be executed in one or more
original or facsimile 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.
11.9. NO FIDUCIARY DUTY. The Company acknowledges and agrees that neither the
Co-Representatives, the Underwriters nor the controlling persons of any of them
shall have any fiduciary or advisory duty to the Company or any of its
controlling persons arising out of, or in connection with, this Agreement or the
offer and sale of the Securities.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
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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,
MEDIA & ENTERTAINMENT HOLDINGS INC.
By: _______________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chairman of the Board and
Chief Executive Officer
Accepted on the date first above written.
LAZARD CAPITAL MARKETS LLC
By:
Name:
Title:
LADENBURG ▇▇▇▇▇▇▇▇ & CO. INC.
By:
Name:
Title:
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