Exhibit
2.1
AGREEMENT AND PLAN OF
MERGER
among
ARMOUR RESIDENTIAL
REIT, INC.,
ARMOUR MERGER SUB
CORP.
and
ENTERPRISE
ACQUISITION CORP.
Dated as of July 29,
2009
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TABLE OF
CONTENTS
Page
ARTICLE I
DEFINITIONS
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Section 1.1
Defined Terms
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Section 1.2
Interpretation
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ARTICLE II
THE MERGER
A-9
Section 2.1
The Merger
A-9
Section 2.2
Effective Time;
Closing
A-10
Section 2.3
Articles of
Incorporation and Bylaws
A-10
Section 2.4
Directors and
Officers
A-10
ARTICLE III
EFFECT OF THE MERGER ON
THE CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS; EXCHANGE OF
CERTIFICATES A-10
Section 3.1
Effect on Capital Stock
and Warrants
A-10
Section 3.2
Converting
Shares
A-10
Section 3.3
No Further Ownership
Rights in Shares
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Section 3.4
Stock Transfer
Books
A-11
Section 3.5
Affiliates
A-11
Section 3.6
Certain
Adjustments
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ARTICLE IV
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY
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Section 4.1
Organization;
Qualification
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Section 4.2
Capitalization
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Section 4.3
Authority;
Approval
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Section 4.4
Consents and Approvals;
No Violations
A-12
Section 4.5
SEC Reports; Financial
Statements and Sarbanes-Oxley Act
A-12
Section 4.6
Absence of Undisclosed
Liabilities
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Section 4.7
Absence of Certain
Changes or Events
A-13
Section 4.8
Contracts
A-13
Section 4.9
Litigation
A-13
Section 4.10
Permits; Compliance with
Applicable Law
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Section 4.11
Tax Matters
A-14
Section 4.12
Assets and
Properties
A-14
Section 4.13
Transactions with
Affiliates
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Section 4.14
Employee
Matters
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Section 4.15
Required Votes of the
Company’s Stockholders and Warrantholders
A-15
Section 4.16
Trust Account
A-15
Section 4.17
Brokers
A-15
Section 4.18
Disclosure
A-15
Section 4.19
Section 203 of the
DGCL
A-15
Section 4.20
No Additional
Representations
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ARTICLE V
REPRESENTATIONS AND
WARRANTIES OF PARENT AND MERGER SUB
A-15
Section 5.1
Organization
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Section 5.2
Capitalization
A-15
Section 5.3
Authority;
Approval
A-16
Section 5.4
Consents and Approvals;
No Violations
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Section 5.5
New Company/No
Operations of Parent and Merger Sub
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Section 5.6
Litigation
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Section 5.7
Brokers
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Section 5.8
REIT
A-17
Section 5.9
Tax Matters
A-17
Section 5.10
No Additional
Representations
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ARTICLE VI
COVENANTS
A-18
Section 6.1
Conduct of the
Parties
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Section 6.2
No
Solicitation
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A-2
Section 6.3
Proxy
Statement/Prospectus; S-4 Registration Statement; Information
Supplied
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Section 6.4
Stockholders and
Warrantholders Meeting
A-21
Section 6.5
Filings; Other Actions;
Notification
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Section 6.6
Access to
Information
A-22
Section 6.7
Further
Assurances
A-22
Section 6.8
Commercially Reasonable
Efforts
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Section 6.9
Indemnification;
Directors’ and Officers’ Insurance
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Section 6.10
Affiliates
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Section 6.11
Certain
Litigation
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Section 6.12
Public
Disclosure
A-23
Section 6.13
Listing
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Section 6.14
Section 16
Matters
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Section 6.15
Trust Account
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Section 6.16
Share
Purchases
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Section 6.17
Proposed Charter
Amendment
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Section 6.18
REIT Election
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Section 6.19
Ancillary
Agreements
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Section 6.20
Asset
Acquisition
A-24
Section 6.21
Resignation
Letters
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Section 6.22
Registration
Statement
A-24
Section 6.23
Restrictions
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Section 6.24
Cancellation of Certain
Pre-IPO Shares
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ARTICLE VII
CONDITIONS
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Section 7.1
Conditions to Each
Party’s Obligation to Effect the Merger
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Section 7.2
Conditions to the
Obligations of the Company
A-25
Section 7.3
Conditions to the
Obligations of Parent and Merger Sub
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ARTICLE VIII
TERMINATION
A-26
Section 8.1
Termination
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Section 8.2
Effect of
Termination
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Section 8.3
Termination
Fee
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ARTICLE IX
MISCELLANEOUS
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Section 9.1
Non-survival of
Representations and Warranties
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Section 9.2
Notices
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Section 9.3
Entire
Agreement
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Section 9.4
Waiver
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Section 9.5
Amendment
A-28
Section 9.6
No Third-Party
Beneficiary
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Section 9.7
Assignment; Binding
Effect
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Section 9.8
CONSENT TO JURISDICTION
AND SERVICE OF PROCESS
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Section 9.9
Specific
Performance
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Section 9.10
Invalid
Provisions
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Section 9.11
GOVERNING LAW
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Section 9.12
Counterparts
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Section 9.13
Expenses
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EXHIBITS:
EXHIBIT A
Form of Second Amended
and Restated Certificate of Incorporation
EXHIBIT B
Investment Criteria for
Asset Acquisitions
EXHIBIT C
Form of Management
Agreement
EXHIBIT D
Sponsors' Voting and
Support Agreement
EXHIBIT E
Form of Warrant
Amendment Agreement
EXHIBIT F
Form of Affiliate
Letters
EXHIBIT G
Form of Escrow
Termination Agreement
EXHIBIT H
Form of Sub-Management
Agreement
EXHIBIT I
Directors and Officers
of Parent
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AGREEMENT AND PLAN OF
MERGER
AGREEMENT AND PLAN OF
MERGER (this “ Agreement ”), dated as of July
29, 2009, among ARMOUR RESIDENTIAL REIT, INC., a Maryland
corporation (“ Parent ”), ARMOUR MERGER SUB
CORP., a Delaware corporation (“ Merger Sub ”),
and ENTERPRISE ACQUISITION CORP., a Delaware corporation (the
“ Company ”).
RECITALS
WHEREAS, the boards of
directors of each of Parent, Merger Sub and the Company have
unanimously approved the merger of Merger Sub with and into the
Company (the “ Merger ”) upon the terms and
subject to the conditions set forth in this Agreement;
WHEREAS, the boards of
directors of each of Parent, Merger Sub and the Company have
unanimously determined that the Merger is fair to and in the best
interests of their respective stockholders;
WHEREAS, the board of
directors of the Company has unanimously approved the Second
Amended and Restated Certificate of Incorporation (the “
Proposed Charter Amendment ”);
WHEREAS, prior to or
simultaneously with the execution of this Agreement, and as a
condition and inducement to Parent to enter into this Agreement,
the Company and Staton Bell Blank Check LLC and certain other
Affiliates of the Company (the “ Sponsors ”) are
entering into the Sponsors' Voting and Support Agreement pursuant
to which the Sponsors have, among other things, agreed, upon the
terms and subject to the conditions thereof, to vote their Shares,
if any, acquired after the IPO in favor of adopting this
Agreement;
WHEREAS, prior to or
simultaneously with the execution of this Agreement, Staton Bell
Blank Check LLC (the “ Sponsor Vehicle ”), the
Parent, Jeffrey J. Zimmer, Scott J. Ulm and Manager are entering
into a Sub-Management Agreement, pursuant to which the Sponsor
Vehicle shall be engaged as a sub-advisor to the Manager to assist
the Manager in providing advisory services to the REIT pursuant to
the Management Agreement; and
WHEREAS, for federal
income tax purposes, it is intended that the Merger qualify as a
contribution governed by Section 351 of the Internal Revenue
Code of 1986, as amended (the “ Code
”).
NOW, THEREFORE, the
parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1
Defined
Terms .
Capitalized terms used but not otherwise defined herein shall
have the meanings set forth below:
“ Acquisition
Proposal ” means any inquiry, proposal, offer or
expression of interest by any Person (other than Parent and its
Affiliates) relating to a merger, consolidation, share exchange,
reorganization, recapitalization, liquidation, dissolution or other
similar transaction or business combination involving the Company,
or the issuance of any securities (or rights to acquire securities)
of the Company, or any similar transaction, or any agreement,
arrangement or understanding requiring the Company to abandon,
terminate or fail to consummate the Transactions.
“
Affiliates ” shall mean any Person that, directly or
indirectly, through one or more intermediaries, controls or is
controlled by or is under common control with the Person specified.
For purposes of this definition, control of a Person means
the power, direct or indirect, to direct or cause the direction of
the management and policies of such Person whether by Contract or
otherwise.
“
Agreement ” has the meaning set forth in the
Preamble.
“ Alternative
Transaction ” means the sale, transfer or other
disposition, directly or indirectly, including through an asset
sale, stock sale or issuance, merger, amalgamation or other similar
transaction, of all or a substantial portion of the Company, in a
transaction or a series of transactions with one or more Persons
(other than Parent and its Affiliates), excluding in each case,
(i) any liquidation of the Company or similar transaction or
(ii) any one or more transactions pursuant to arrangements
contemplated by Section 6.17 .
“ Second
Amended and Restated Certificate of Incorporation ” means
the Amended and Restated Certificate of Incorporation of the
Company substantially in the form attached hereto as
Exhibit B .
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“ Ancillary
Agreements ” means the Warrant Amendment Agreement, the
Sponsors' Voting and Support Agreement, the Management Agreement,
the Escrow Termination Agreement, and the Sub-Management
Agreement.
“ Balance
Sheet ” has the meaning set forth in
Section 4.6 .
“ Business
Combination ” shall mean the Business Combination (as
defined in the Proposed Charter Amendment) between the Company,
Parent and Merger Sub contemplated by this Agreement.
“ Business
Day ” means a day on which the banks are opened for
business (Saturdays, Sundays, statutory and civic holidays
excluded) in New York, New York, United States.
“ Bylaws
” has the meaning set forth in Section 2.3(b)
.
“ Certificate
of Merger ” has the meaning set forth in
Section 2.2 .
“ Change in
Recommendation ” means (i) the withdrawal of, or
modification in a manner adverse to Parent of, the Company
Recommendation or (ii) the recommendation by the
Company’s board of directors or any committee thereof to the
Company’s Stockholders to vote in favor of any Acquisition
Proposal.
“ Closing
” has the meaning set forth in Section 2.2
.
“ Closing
Date ” has the meaning set forth in
Section 2.2 .
“ Code
” has the meaning set forth in the Recitals.
“ Company
” has the meaning set forth in the Preamble.
“ Company
Contracts ” means: (a) any “material
contract” as such term is defined in Item 601(b)(10) of
Regulation S-K of the SEC; (b) all Contracts to which the
Company is a party or by which any of the Company’s assets
may be bound, subjected or affected, which either (i) creates
or imposes a liability greater than $100,000 or (ii) may not
be cancelled by the Company on thirty (30) days’ or less
prior notice; (c) all Contracts concerning a partnership,
joint venture, joint development or other cooperation arrangement;
(d) all material Contracts with any Governmental Authority;
(e) all material Contracts relating to or evidencing
Indebtedness of the Company (or the creation, incurrence,
assumption, securing or guarantee thereof); (f) all material
Contracts for the purchase of any business, corporation,
partnership, joint venture, association or other business
organization or any division, material assets, material operating
unit or material product line thereof; (g) all material
Contracts relating to employment, change of control, retention,
severance or material consulting or advising arrangements;
(h) all Contracts relating to securities of the Company; and
(i) all Contracts which are otherwise material to the Company
taken as a whole (other than the Transaction Documents and other
contracts contemplated by this Agreement) which are not described
in any of the categories specified above.
“ Company
Disclosure Schedule ” has the meaning set forth in
Article IV .
“ Company
Recommendation ” means the recommendation of the
Company’s board of directors to the Company Stockholders to
grant the Company Stockholder Approval.
“ Company
Stockholder Approval ” means (i) the affirmative
vote of a majority of the outstanding Shares entitled to vote
thereon at the Company Stockholders Meeting in person or by proxy
to approve the Proposed Charter Amendment, (ii) the
affirmative vote of a majority of the outstanding Shares entitled
to vote thereon at the Company Stockholders Meeting in person or by
proxy to adopt this Agreement, (iii) the affirmative vote of a
majority of the outstanding IPO Shares voted at the Company
Stockholders Meeting in Person or by proxy to approve the Business
Combination and (iv) any other approvals of the Company
Stockholders necessary to approve this Agreement and the
Transactions.
“ Company
Stockholders ” means holders of Shares.
“ Company
Stockholders Meeting ” has the meaning set forth in
Section 6.4(a) .
“ Company
Warrantholder Approval ” means the approval by proxy or
written consent of a majority of the Company Warrantholders to the
Warrant Amendment Agreement.
“ Company
Warrantholders ” means holders of Warrants.
“ Company
Warrantholders Meeting ” has the meaning set forth in
Section 6.4(a) .
“ Contract
” has the meaning set forth in Section 4.4(b)
.
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“ Conversion
Consideration ” has the meaning set forth in
Section 3.2 .
“ Conversion
Price ” has the meaning set forth in
Section 3.2 .
" Conversion
Threshold " means thirty percent (30%) or more of the IPO
Shares, or fifty percent (50%) or more of the IPO Shares if the
secondary charter proposal is approved at the Company's special
meeting to obtain stockholder approval.
“ Converting
Shares ” has the meaning set forth in
Section 3.2 .
“ Converting
Stockholder ” has the meaning set forth in
Section 3.2 .
“ Costs
” has the meaning set forth in Section 6.9(a)
.
“ DGCL
” has the meaning set forth in Section 2.1
.
“ D&O
Insurance ” has the meaning set forth in
Section 6.9(b) .
“ Effective
Time ” has the meaning set forth in
Section 2.2 .
" Enterprise
Distribution " means that certain one-time cash distribution of
$0.13 per share to be declared by the Company prior to the Closing
Date.
“ ERISA
” means the Employee Retirement Income Security Act of
1974.
“ ERISA
Affiliate ” of any Person means any other Person that,
together with such Person, would be treated as a single employer
under Section 414(b), (c), (m) or (o) of the
Code.
“ Escrow
Termination Agreement ” means the termination agreement
entered into among the Company, Staton Bell Blank Check LLC,
Stewart Paperin, Richard Steiner, Jordan Zimmerman and Continental
Stock Transfer & Trust Company and attached hereto as
Exhibit G .
“ Exchange
Act ” has the meaning set forth in
Section 4.4(a) .
“ Exchange
Ratio ” has the meaning set forth in
Section 3.1(a) .
“ Expenses
” means the out-of-pocket fees and expenses of a party,
including related to its advisors, counsel and accountants,
incurred by the party or on its behalf in connection with the
Transactions, including the out-of-pocket expenses related to the
preparation, printing, filing and mailing of the S-4 Registration
Statement and the Proxy Statement/Prospectus and the solicitation
of Company Stockholder Approval.
“ GAAP
” means United States generally accepted accounting
principles.
“ Governmental
Authority ” has the meaning set forth in
Section 4.4(a) .
“
Indebtedness ” means, with respect to any Person on
any date of determination (without duplication): (a) the
principal of, interest on and premium (if any) in respect of
indebtedness of such Person for borrowed money; (b) the
principal of, interest on and premium (if any) in respect of
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments; (c) the principal component of all
obligations of such Person in respect of letters of credit,
bankers’ acceptances or other similar instruments (including
reimbursement obligations with respect thereto except to the extent
such reimbursement obligation relates to a trade payable and such
obligation is satisfied within ninety (90) days of incurrence);
(d) capitalized lease obligations of such Person; (e) the
principal component of all obligations of such Person to pay the
deferred and unpaid purchase price of property (except trade
payables); and (f) the principal component of Indebtedness of
other Persons to the extent guaranteed by such Person.
“ Indemnified
Parties ” has the meaning set forth in
Section 6.9(a) .
“ Investment
Criteria ” means the investment criteria set forth on
Exhibit C , pursuant to which Parent will acquire agency
residential mortgage-backed securities and other assets.
“ IPO
” means the initial public offering of the Company,
consummated on November 14, 2007.
“ IPO
Shares ” means the Shares issued in the IPO (excluding,
for the avoidance of doubt, Shares issued to the Sponsors prior to
the IPO).
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“ Law
” means, with respect to any Person, any federal, state or
local law (statutory, common or otherwise), constitution, treaty,
convention, ordinance, code, rule, regulation, order, injunction,
judgment, decree, ruling or other similar requirement enacted,
adopted, promulgated or applied by a Governmental Authority that is
binding upon or applicable to such Person, as amended, unless
expressly specified otherwise.
“
Liability ” means any and all claims, debts,
liabilities, obligations and commitments of whatever nature,
whether known or unknown, asserted or unasserted, fixed, absolute
or contingent, matured or unmatured, accrued or unaccrued,
liquidated or unliquidated or due or to become due, and whenever or
however arising (including those arising out of any Contract or
tort, whether based on negligence, strict liability or otherwise)
and whether or not the same would be required by GAAP to be
reflected as a liability in financial statements or disclosed in
the notes thereto.
“ Lien
” means any lien, charge, pledge, security interest, claim or
other encumbrance.
“ Management
Agreement ” means the management agreement to be entered
into between Parent and Manager substantially in the form attached
hereto as Exhibit C .
“ Manager
” means ARMOUR Residential Management LLC, a Delaware limited
liability company.
“ Material
Adverse Effect ” means, with respect to any Person, an
event, circumstance, change or effect that has had, or is
reasonably likely to have, (a) a material adverse effect on
the business, assets, condition (financial or otherwise) or results
of operations of such Person and its subsidiaries taken as a whole
other than any event, circumstance, change or effect resulting from
(i) general economic, market or political conditions,
(ii) matters generally affecting the industries or market
sectors in which such Person operates, (iii) the announcement
or expectation of the Transactions, (iv) any of the
requirements or limitations imposed on such Person pursuant to this
Agreement or the other Transaction Documents, (v) changes in
Law, (vi) changes in GAAP, (vii) acts of war or
terrorism, (viii) fluctuations in the share price of such
Person’s common stock, except, in the case of the foregoing
clauses (i), (ii) and (vii) only, to the extent such
changes do not have a materially disproportionate impact on such
Person and its subsidiaries, taken as a whole, relative to other
companies in the industries in which such Person and its
subsidiaries conduct their business or (b) a material adverse
effect on the ability of such Person to perform its obligations
under this Agreement or any of the other Transaction Documents, or
that would prevent or materially delay the consummation of the
Transactions.
“ Merger
” has the meaning set forth in the Recitals.
“ Merger
Consideration ” has the meaning set forth in
Section 3.1(a) .
“ Merger
Sub ” has the meaning set forth in the
Preamble.
“ NYSE
” means the New York Stock Exchange.
“ NYSE
Amex ” means NYSE Amex Equities.
“ Parent
” has the meaning set forth in the Preamble.
“ Parent
Shares ” has the meaning set forth in
Section 3.1(a) .
“ Permits
” has the meaning set forth in Section 4.10
.
“ Permitted
Liens ” means (i) Liens for Taxes not yet due and
payable or that are being contested in good faith by appropriate
proceedings (if then appropriate), (ii) mechanics’,
carriers’, workers’ and other similar Liens arising or
incurred in the ordinary course of business, and (iii) other
Liens that individually or in the aggregate with other title
defects, do not materially impair the value of the property subject
to such Liens or other such title defect or the use of such
property in the conduct of the business.
“ Person
” means any individual, sole proprietorship, firm,
corporation (including any non-profit corporation and public
benefit corporation), general or limited partnership, limited
liability partnership, joint venture, limited liability company,
estate, trust, association, organization, labor union, institution,
entity or Governmental Authority, including any successor (by
merger or otherwise) of such Person.
“ Proposed
Charter Amendment ” has the meaning set forth in the
Recitals.
“ Proxy
Statement/Prospectus ” has the meaning set forth in
Section 6.3(a) .
“ Public
Stockholders ” means the holders of the IPO
Shares.
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“ Registration
Rights Agreement ” means the registration rights
agreement containing customary terms and conditions to be entered
into between the Parent and the Sponsors.
“ REIT
” has the meaning set forth in Section 6.19
.
“ S-4
Registration Statement ” has the meaning set forth in
Section 6.3(a) .
“ SEC
” means the Securities and Exchange Commission.
“ SEC
Reports ” has the meaning set forth in
Section 4.5(a) .
“ Securities
Act ” has the meaning set forth in
Section 3.3 .
“ Shares
” has the meaning set forth in Section 3.1(a)
.
“ Sponsors
” has the meaning set forth in the Recitals.
" Sponsor
Vehicle " has the meaning set forth in the Recitals.
“
Sponsors' Voting and Support Agreement ” means the
agreement entered into between the Company, Parent, Merger Sub,
Manager and the Sponsors in the form attached hereto as Exhibit
F .
“
Sub-Management Agreement ” means the Sub-Management
Agreement to be entered into between the Parent, Scott J. Ulm,
Jeffrey J. Zimmer, the Manager and Sponsor Vehicle substantially in
the form attached hereto as Exhibit H .
“ Superior
Proposal ” means any bona fide written Acquisition
Proposal pursuant to which a third party would own fifty percent
(50%) or more of the assets, revenue or net income of the Company,
or in the case of the issuance of securities (or rights to acquire
securities) of the Company, such third party would represent fifty
percent (50%) or more of the voting power in the Company, on terms
that the board of directors of the Company determines in its good
faith judgment are more favorable to the Company’s
stockholders than the Transactions (taking into account the various
legal, financial and regulatory aspects of the proposal and the
Person making the proposal and any changes to the Transactions
proposed by Parent in response to the receipt by the Company of
such proposal) and that is not subject to any material contingency
unless, in the good faith judgment of the board of directors of the
Company, such contingency is reasonably capable of being
satisfied.
“ Surviving
Company ” has the meaning set forth in
Section 2.1 .
“ Tax
” means any federal, state, local or foreign income, gross
receipts, property, sales, use, license, excise, franchise,
employment, payroll, withholding, alternative or add on minimum, ad
valorem, transfer or excise tax, or any other tax, custom, duty,
governmental fee or other like assessment or charge of any kind
whatsoever, together with any interest, penalty, addition to tax or
additional amount imposed by any governmental authority or any
obligation to pay taxes imposed on any entity for which a party to
this Agreement is liable as a result of any indemnification
provision or other Contractual obligation.
“ Tax
Return ” means any return, report or similar statement
required to be filed with respect to any Tax (including any
attached schedules), including, without limitation, any information
return, claim for refund, amended return or declaration of
estimated Tax.
“ Termination
Date ” has the meaning set forth in
Section 8.1(b)(ii) .
“ Transaction
Documents ” means this Agreement, including all Schedules
and Exhibits hereto, including the Company Disclosure Schedules,
and the Ancillary Agreements.
“ Termination
Fee ” has the meaning set forth in Section 8.3
(a) .
“
Transactions ” means the transactions contemplated by
the Transaction Documents.
“ Trust
Account ” means the trust account established by the
Company in connection with the consummation of the IPO and into
which the Company deposited a designated portion of the net
proceeds from the IPO.
“ Trust
Agreement ” means the Investment Management Trust
Agreement dated November 7, 2007 between Continental Stock
Transfer & Trust Company and the Company.
“
Warrant ” has the meaning set forth in
Section 4.2 .
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“ Warrant
Amendment Agreement ” means the warrant amendment
agreement to be entered into between the Company, Parent and
Continental Stock Transfer & Trust Company substantially
in the form attached hereto as Exhibit E .
Section 1.2
Interpretation
.
(a)
When a reference is
made in this Agreement to an Article or a Section, such reference
shall be to an Article or a Section of this Agreement unless
otherwise indicated.
(b)
The table of contents
and headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation
of this Agreement.
(c)
The parties have
participated jointly in negotiating and drafting this Agreement.
If an ambiguity or a question of intent or interpretation
arises, this Agreement shall be construed as if drafted jointly by
the parties, and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of
any provisions of this Agreement.
(d)
The words
“include”, “includes” or
“including” shall be deemed to be followed by the words
“without limitation.”
(e)
The words
“hereof,” “herein” and
“hereunder” and words of similar import, when used in
this Agreement, refer to this Agreement as a whole and not to any
particular provision of this Agreement.
(f)
All terms defined in
this Agreement have their defined meanings when used in any
certificate or other document made or delivered pursuant hereto,
unless otherwise defined therein.
(g)
The definitions
contained in this Agreement are applicable to the singular as well
as the plural forms of such terms.
(h)
If any action is to be
taken by any party hereto pursuant to this Agreement on a day that
is not a Business Day, such action shall be taken on the next
Business Day following such day.
(i)
References to a Person
are also to its permitted successors and assigns.
(j)
The use of
“or” is not intended to be exclusive unless expressly
indicated otherwise.
(k)
“Reasonable best
efforts” or similar terms shall not require the waiver of any
rights under this Agreement.
(l)
A
“subsidiary” of any Person means another Person, an
amount of the voting securities, other voting ownership or voting
partnership interests of which is sufficient to elect at least a
majority of its board of directors or other governing body (or, if
there are no such voting interests, fifty percent (50%) or more of
the equity interests of which) is owned directly or indirectly by
such first Person.
(m)
The term
“ordinary course of business” (or similar terms) shall
be deemed to be followed by the words “consistent with past
practice. ”
ARTICLE II
THE
MERGER
Section 2.1
The
Merger .
Upon the terms and subject to the conditions set forth
herein, and in accordance with the Delaware General Corporation Law
(the “ DGCL ”), at the Effective Time, Merger
Sub shall be merged with and into the Company, the separate
existence of Merger Sub shall thereupon cease and the Company shall
continue as the surviving corporation (the “ Surviving
Company ”) and a wholly owned subsidiary of Parent.
The Merger shall have the effects set forth in the
DGCL.
Section 2.2
Effective Time;
Closing .
As promptly as practicable (but in no event more than two (2)
Business Days) after the satisfaction or waiver of the conditions
to the Merger set forth in Article VII (other than
conditions that by their nature are to be satisfied at the Closing,
but subject to such conditions), the Surviving Company shall
(i) file in the office of the Secretary of State of the State
of Delaware, a certificate of merger (the “ Certificate of
Merger ”) meeting the requirements of the DGCL and
(ii) execute, acknowledge, deliver, file and/or record all
such other instruments, and take all such other actions, as may be
required in order to cause the Merger to become effective in
accordance with the provisions of the DGCL. The date and time
on which the Merger becomes effective in accordance with the
applicable provisions of the DGCL is hereinafter referred to as the
“ Effective Time .” Prior to such filing,
a closing (the “ Closing ”) shall be held at
the
A-9
offices of Akerman
Senterfitt, One Southeast Third Avenue, Suite 2500, Miami, Florida
33131. The date of the Closing is referred to as the “
Closing Date .”
Section 2.3
Articles of
Incorporation and Bylaws .
(a)
The certificate of
incorporation of Merger Sub as in effect immediately prior to the
Effective Time shall be the certificate of incorporation of the
Surviving Company until amended in accordance with the
DGCL.
(b)
The bylaws of Merger
Sub as in effect immediately prior to the Effective Time (“
Bylaws ”) shall be the bylaws of the Surviving Company
until amended in accordance with the DGCL.
Section 2.4
Directors and
Officers .
(a)
The board of directors
of Parent will take all action necessary to increase the size of
the board of directors to nine (9) directors and shall elect to the
board of directors of Parent the persons listed on Exhibit I
and the remaining directors of Parent not designated to remain on
Parent’s board of directors after the Effective Time shall
resign from Parent’s board of directors, in each case
effective as of the Effective Time.
(b)
The directors of Merger
Sub immediately prior to the Effective Time shall be the directors
of the Surviving Company and the officers of Merger Sub immediately
prior to the Effective Time shall be the officers of the Surviving
Company, in each case until duly removed or replaced in accordance
with the Bylaws of the Surviving Company and the DGCL.
ARTICLE III
EFFECT OF THE MERGER
ON THE CAPITAL STOCK OF THE CONSTITUENT
CORPORATIONS;
EXCHANGE OF CERTIFICATES
Section 3.1
Effect on Capital
Stock and Warrants . As of the Effective Time, by
virtue of the Merger and without any action on the part of any
holder thereof:
(a)
each issued and
outstanding share of common stock, par value $0.0001 per share, of
the Company (the “ Shares ”) (other than
Converting Shares and any Shares to be cancelled in accordance with
Section 3.1(c) hereof) shall be converted into the
right to receive one (the “ Exchange Ratio ”)
fully paid and nonassessable share of common stock, par value $0.01
per share, of Parent (the “ Parent Shares ”)
(the “ Merger Consideration ”);
(b)
all such Shares shall
no longer be outstanding and shall automatically be cancelled and
retired and shall cease to exist, and each holder of a certificate
representing any such Shares shall cease to have any rights with
respect thereto, except the right to receive the Merger
Consideration or the Conversion Consideration, as
applicable;
(c)
(i) each Share that is
owned by the Company (other than Shares held either in a fiduciary
or agency capacity that are beneficially owned by third parties)
and (ii) each Share that is owned by Parent or Merger Sub
(other than Shares held either in a fiduciary or agency capacity
that are beneficially owned by third parties) shall be transfered
to the Company and shall be cancelled and retired and shall cease
to exist, and no consideration shall be delivered in exchange
thereafter;
(d)
each Parent Share
issued and outstanding prior to the Effective Time shall no longer
be outstanding and shall automatically be cancelled and retired and
shall cease to exist, and each holder of a certificate representing
any such Parent Shares shall cease to have any rights with respect
thereto whatsoever;
(e)
each issued and
outstanding share of common stock of Merger Sub shall be converted
into and become one fully paid and nonassessable share of common
stock of the Surviving Company; and
(f)
subject to the Warrant
Amendment Agreement, each unexercised and unexpired Warrant to
purchase Shares of the Company which is outstanding immediately
prior to the Effective Time shall automatically become exercisable
for the kind and amount of securities which the holder of a Warrant
would have owned immediately after the Effective Time if such
holder had exercised the Warrant immediately before the Effective
Time.
Section 3.2
Converting
Shares .
Each Company Stockholder who at the Company Stockholder
Meeting votes against the Business Combination (each, a “
Converting Stockholder ”) may, contemporaneously with
such vote, demand that the Company convert its Shares (the “
Converting Shares ”) into cash. To perfect such
conversion, each Converting Stockholder must deliver its
certificate to Continental Stock Transfer & Trust Company,
as trustee for the Trust Account, physically or electronically
using Depository Trust Company’s DWAC (Deposit Withdrawal at
Custodian) System at any time up to the Company Stockholders
Meeting. If so demanded and properly perfected, the Company
shall, promptly after the Closing, convert such Converting Shares
into cash at a per share conversion price (the “
Conversion Price ”), calculated as of two (2) Business
Days prior to the Closing, equal to the quotient determined by
dividing (A) the amount then held in the
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Trust Account, by
(B) the total number of IPO Shares then outstanding (the
“ Conversion Consideration ”). The Converting
Shares shall thereafter be cancelled.
Section 3.3
No Further Ownership
Rights in Shares . All Conversion Consideration
delivered upon the surrender of certificates in accordance with the
terms of this Article III shall be deemed to have been paid
in full satisfaction of all rights pertaining to the Shares
theretofore represented by such certificates. Until
surrendered as contemplated by this Section 3.3 , each
certificate shall be deemed at any time after the Effective Time to
represent only the right to receive upon surrender the Conversion
Consideration. No interest will be paid or will accrue on the
cash or any other amounts payable upon the surrender of any
certificate.
Section 3.4
Stock Transfer
Books .
At the Effective Time, the stock transfer books of the
Company shall be closed, and there shall be no further registration
of transfers on the stock transfer books of the Surviving Company
of the Shares that were outstanding immediately prior to the
Effective Time.
Section 3.5
Affiliates . Notwithstanding anything to
the contrary herein, no Parent Shares or Warrants shall be
delivered to a Person who may be deemed an “affiliate”
of the Company for purposes of Rule 145 under the Securities Act of
1933 (together with the rules and regulations thereunder, the
“ Securities Act ”) until such Person has
executed and delivered an agreement, substantially in the form of
Exhibit F , to Parent.
Section 3.6
Certain
Adjustments . If after the date hereof
and on or prior to the Effective Time the outstanding Shares or
Parent Shares shall be changed by reason of any reclassification,
recapitalization, split-up, combination or exchange of shares, or
any dividend payable in stock or other securities shall be declared
thereon with a record date within such period, or any similar event
shall occur, the Exchange Ratio shall be appropriately
adjusted.
ARTICLE IV
REPRESENTATIONS AND
WARRANTIES OF THE COMPANY
The Company represents
and warrants to Parent and Merger Sub that, except as set forth in
the SEC Reports filed with the SEC and publicly available not later
than two (2) Business Days prior to the date of this Agreement or
in the disclosure schedule delivered by the Company to Parent prior
to the execution and delivery of this Agreement (it being agreed
that any disclosure set forth on any particular section of the
Company Disclosure Schedule shall be deemed disclosed in another
section of the Company Disclosure Schedule if the relevance of such
disclosure to such other section is reasonably apparent)(the
“ Company Disclosure Schedule ”):
Section 4.1
Organization;
Qualification .
(a)
The Company is duly
organized, validly existing and in good standing under the laws of
the jurisdiction of its organization and has all requisite power
and authority to own, license, use, lease and operate its assets
and properties and to carry on its business as it is now being
conducted.
(b)
The Company is duly
qualified or licensed to do business and in good standing in each
jurisdiction in which the assets or property owned, licensed, used,
leased or operated by it or the nature of the business conducted by
it makes such qualification or licensing necessary, except in such
jurisdictions where the failure to be so duly qualified or licensed
and in good standing has not had and would not reasonably be
expected to have a Material Adverse Effect on the
Company.
Section 4.2
Capitalization
. The authorized
capital stock of the Company consists of 100,000,000 Shares and
1,000,000 shares of preferred stock. At the close of business
on the date of this Agreement, (i) 31,250,000 Shares were
issued and outstanding, (ii) no shares of preferred stock were
issued and outstanding and (iii) 32,500,000 warrants entitling
the holder to purchase one Company Share per warrant (each, a
“ Warrant ”) were issued and outstanding.
All outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and
nonassessable, and have not been issued in violation of any
preemptive or similar rights. Except as set forth above in
this Section 4.2 , there are no outstanding
(x) shares of capital stock or other voting securities of the
Company, (y) securities of the Company convertible into or
exchangeable for shares of capital stock or other securities of the
Company or (z) subscriptions, options, warrants, puts, calls,
phantom stock rights, stock appreciation rights, stock-based
performance units, agreements, understandings, claims or other
commitments or rights of any type granted or entered into by the
Company relating to the issuance, sale, repurchase or transfer of
any securities of the Company or that give any Person or entity the
right to receive any economic benefit or right similar to or
derived from the economic benefits and rights of securities of the
Company. Except with respect to the right of Converting
Stockholders to be paid the Conversion Price, there are no
outstanding obligations of the Company to repurchase, redeem or
otherwise acquire any securities of the Company or to vote or to
dispose of any shares of the capital stock of the
Company.
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Section 4.3
Authority;
Approval .
(a)
The Company has all
requisite power and authority to execute and deliver this Agreement
and the Transaction Documents to which it is a party and to perform
and consummate the Transactions. The execution, delivery and
performance of this Agreement and the Transaction Documents to
which it is a party and the consummation by the Company of the
Transactions have been duly authorized by all necessary corporate
action on the part of the Company and no corporate or other
proceedings on the part of the Company are necessary to authorize
this Agreement or the Transaction Documents to which it is a party
or to consummate the Transactions, other than (i) the Company
Stockholder Approval and Company Warrantholder Approval and
(ii) the filing of the Proposed Charter Amendment with the
Secretary of State of Delaware. This Agreement has been duly
executed and delivered by the Company and, assuming due execution
and delivery by Parent and Merger Sub, constitutes a valid and
binding obligation of the Company, enforceable against the Company
in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors’
rights and to general equity principles.
(b)
The board of directors
of the Company, by resolution duly adopted at a meeting duly called
and held has (i) determined that this Agreement and the
Transactions are fair and in the best interest of the Company and
the Company Stockholders, (ii) adopted a resolution approving
this Agreement, setting forth the Proposed Charter Amendment and
declaring the advisability of this Agreement and the Proposed
Charter Amendment, (iii) directed that this Agreement, the
Proposed Charter Amendment and the Business Combination be
submitted to the Company Stockholders for consideration at the
Company Stockholders Meeting and (iv) resolved to make the
Company Recommendation.
Section 4.4
Consents and
Approvals; No Violations .
(a)
The execution, delivery
and performance by the Company, of this Agreement and the
Transaction Documents to which it is a party and the consummation
by the Company of the Transactions do not and will not require any
filing or registration with, notification to, or authorization,
permit, consent or approval of, or other action by or in respect
of, any foreign or domestic governmental body, self-regulatory
organization, court or arbiter, agency, commission, official or
regulatory or other authority (collectively, “
Governmental Authority ”) other than (i) the
filing of the Certificate of Merger as contemplated by Article
II hereof, (ii) compliance with any applicable
requirements of the Securities and Exchange Act of 1934 (together
with the rules and regulations thereunder, the “ Exchange
Act ”), (iii) compliance with any applicable
requirements of the NYSE Amex and (iv) the filing of the
Proposed Charter Amendment as contemplated by
Section 6.18 hereof.
(b)
The execution, delivery
and performance by the Company of this Agreement and the
Transaction Documents to which it is a party and the consummation
by the Company of the Transactions do not and will not
(i) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default under, or
give rise to any right of termination, amendment, cancellation,
acceleration or loss of benefits or the creation or acceleration of
any right or obligation under or result in the creation of any Lien
upon any of the properties or assets of the Company under, any of
the terms, conditions or provisions of any note, bond, mortgage,
indenture, deed of trust, loan, credit agreement, lease, license,
permit, concession, franchise, purchase order, sales order
contract, agreement or other instrument, understanding or
obligation, whether written or oral (a “ Contract
”), to which the Company is a party or by which any of its
properties or assets may be bound or (ii) violate any
judgment, order, writ, preliminary or permanent injunction or
decree or any statute, law, ordinance, rule or regulation of any
Governmental Authority applicable to the Company or any of its
properties or assets, except in the case of clauses (i) or
(ii) for violations, breaches or defaults that would not
reasonably be expected to have a Material Adverse Effect on the
Company. The consummation by the Company of the Transactions do not
and will not conflict with or result in any breach of any provision
of the Proposed Charter Amendment.
Section 4.5
SEC Reports;
Financial Statements and Sarbanes-Oxley Act .
(a)
The Company has timely
filed all required registration statements, reports, schedules,
forms, statements and other documents required to be filed by it
with the SEC since August 6, 2007 (collectively, as they have been
amended since the time of their filing and including all exhibits
thereto, the “ SEC Reports ”). None of the
SEC Reports, as of their respective dates (or if amended or
superseded by a filing prior to the date of this Agreement or the
Closing Date, then on the date of such filing), contained any
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, in light of the circumstances under which they
were made, not misleading. The audited financial statements
and unaudited interim financial statements (including, in each
case, the notes and schedules thereto) included in the SEC Reports
complied as to form in all material respects with the published
rules and regulations of the SEC with respect thereto, were
prepared in accordance with GAAP applied on a consistent basis
during the periods involved (except as may be indicated therein or
in the notes thereto and except with respect to unaudited
statements as permitted by Form 10-Q of the SEC) and fairly present
(subject, in the case of the unaudited interim financial
statements
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included therein, to
normal year-end adjustments and the absence of complete footnotes)
in all material respects the financial position of the Company as
of the respective dates thereof and the results of their operations
and cash flows for the respective periods then ended.
(b)
The Company has
established and maintains disclosure controls and procedures (as
defined in Rule 13a-15 under the Exchange Act). Such
disclosure controls and procedures are designed to ensure that
material information relating to the Company is made known to the
Company’s principal executive officer and its principal
financial officer, particularly during the periods in which the
periodic reports required under the Exchange Act are being
prepared. To the Company’s knowledge, such disclosure
controls and procedures are effective in timely alerting the
Company’s principal executive officer and principal financial
officer to material information required to be included in the
Company’s periodic reports required under the Exchange
Act.
(c)
The Company has
established and maintained a system of internal controls. To
the Company’s knowledge, such internal controls are
sufficient to provide reasonable assurance regarding the
reliability of the Company’s financial reporting and the
preparation of the Company’s financial statements for
external purposes in accordance with GAAP.
(d)
There are no
outstanding loans or other extensions of credit made by the Company
to any executive officer (as defined in Rule 3b-7 under the
Exchange Act) or director of the Company. The Company has not
taken any action prohibited by Section 402 of the
Sarbanes-Oxley Act.
Section 4.6
Absence of
Undisclosed Liabilities . The Company has no
Liabilities of any kind or character except for Liabilities
(i) in the amounts set forth or reserved on the Company
balance sheet or the notes thereto, as included in the Form 10-K
the Company filed with the SEC on March 16, 2009 (the “
Balance Sheet ”), (ii) arising after March 31,
2009 in the ordinary course of business, (iii) incurred in
connection with the Transactions or (iv) which are not,
individually or in the aggregate, material. Section 4.6
of the Company Disclosure Schedule lists all Liabilities incurred
by the Company since March 31, 2009.
Section 4.7
Absence of Certain
Changes or Events .
(a)
Except as otherwise set
forth on Section 4.7 of the Company Disclosure Schedule,
since January 1, 2009, the Company has conducted its business only
in the ordinary course in all material respects and there has not
been a Material Adverse Effect on the Company.
(b)
Except as otherwise set
forth on Section 4.7 of the Company Disclosure Schedule,
since January 1, 2009, the Company has not taken any action which,
if taken after the date hereof and prior to the Closing without the
prior written consent of Parent, would violate
Section 6.1(a) hereof.
Section 4.8
Contracts
. Each Company
Contract is valid, binding and enforceable against the Company and,
to the knowledge of the Company, against each other party thereto
in accordance with its terms, and is in full force and effect.
The Company has performed all material obligations required
to be performed by it to date under, and is not in material default
or delinquent in performance or any other respect (claimed or
actual) in connection with, any Company Contract, and no event has
occurred which, with due notice or lapse of time or both, would
constitute such a default thereunder. To the knowledge of the
Company, no other party to any Company Contract is in material
default in respect thereof, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default,
except in each case as would not reasonably be expected to have a
Material Adverse Effect on the Company.
Section 4.9
Litigation . There are no material suits,
claims, actions, proceedings or investigations pending or, to the
knowledge of the Company, threatened, before any Governmental
Authority of any nature, brought by or against any of the Company
or, to the knowledge of the Company, any of its respective officers
or directors involving or relating to the Company or the assets,
properties or rights of the Company or the Transactions.
There is no material judgment, decree, injunction, rule or
order of any Governmental Authority of any nature outstanding or,
to the knowledge of the Company, threatened against the
Company.
Section 4.10
Permits; Compliance
with Applicable Law . The Company holds all
permits, licenses, authorizations, certificates, variances,
exemptions, orders and approvals of all Governmental Authorities
necessary for the lawful conduct of its business as presently
conducted and to own its assets and properties (the “
Permits ”), except for failures to hold such Permits
that would not reasonably be expected to have a Material Adverse
Effect on the Company. The Company is in compliance with the
terms of each Permit, except where the failure so to comply would
not reasonably be expected to have a Material Adverse Effect on the
Company. The business of the Company has not been and is not
being conducted in violation of any Law except for violations that
would not reasonably be expected to have a Material Adverse Effect
on the Company. No investigation or review by any
Governmental Authority with respect to the Company is
pending
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or, to the best
knowledge of the Company, threatened, nor has any Governmental
Authority indicated an intention to conduct any such investigation
or review, other than, in each case, where the outcome would not
reasonably be expected to have a Material Adverse Effect on the
Company.
Section 4.11
Tax
Matters .
(a)
All U.S. federal and
state income Tax Returns and all other material Tax Returns
required to be filed with any taxing authority by, or with respect
to the Company have been filed in accordance with all applicable
law, and such Tax Returns are true, correct and complete in all
material respects. The Company has timely paid all Taxes
shown as due and payable on such Tax Returns or that are otherwise
due. The Company has made provision for all material Taxes
payable by it for which no Tax Return has yet been filed. The
Balance Sheet reflects an adequate reserve for all material Taxes
payable by the Company for all taxable periods and portions thereof
through the date of such Balance Sheet.
(b)
There is no action,
suit, proceeding, audit or claim now pending or, to the knowledge
of the Company, threatened against or with respect to the Company
in respect of any Tax and no taxing authority has given written
notice of the commencement of any audit, examination or deficiency
action with respect to any such Taxes.
(c)
The Company has
withheld and paid all Taxes required to have been withheld and paid
in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder or other third party.
The Company has not made any payments, is not obligated to
make any payments and is not a party to any agreement that under
certain circumstances could obligate it to make any payments that
will not be deductible under Section 162(m) or 280G of the
Code.
(d)
There are no
outstanding Contracts or waivers extending the statutory period of
limitations applicable to any claim for, or the period for the
collection or assessment of, material Taxes of the Company due for
any taxable period.
(e)
The Company has not
received written notice of any claim, and, to the knowledge of the
Company, no claim has ever been made, by any taxing authority in a
jurisdiction where the Company does not file Tax Returns that the
Company is or may be subject to taxation by that
jurisdiction.
(f)
The Company has not
requested, nor is the subject of or bound by, any private letter
ruling, technical advise memorandum, closing agreement or similar
ruling, memorandum or agreement with any taxing authority with
respect to any material Taxes, nor is any such request
outstanding.
(g)
The Company has not
participated in a “listed transaction,” as defined in
Treasury Regulation § 1.6011-4(b)(2).
Section 4.12
Assets and
Properties .
The Company has valid title to or a valid leasehold interest
in all of its material assets and properties (whether real,
personal or mixed, or tangible) (including all assets and
properties recorded on the Balance Sheet, other than assets and
properties disposed of in the ordinary course of business), in each
case free and clear of any Liens other than Permitted
Liens.
Section 4.13
Transactions with
Affiliates .
Except as contemplated by the Transaction Documents, there
are no Contracts or transactions between the Company and any of its
Affiliates including the Sponsors and any of their employees,
officers or directors.
Section 4.14
Employee
Matters .
(a)
The Company does not
and is not required to, and has not and has never been required to,
maintain, sponsor, contribute to, or administer any pension,
retirement, savings, money purchase, profit sharing, deferred
compensation, medical, vision, dental, hospitalization,
prescription drug and other health plan, cafeteria, flexible
benefits, short-term and long-term disability, accident and life
insurance plan, bonus, stock option, stock purchase, stock
appreciation, phantom stock, incentive and special compensation
plan or any other employee or fringe benefit plan, program or
contract and does not have any liability of any kind with respect
to any of the foregoing (under ERISA or otherwise). The
Company does not have any contract, plan or commitment, whether or
not legally binding, to create any of the foregoing other than as
contemplated by this Agreement. Neither the Company nor any
of its ERISA Affiliates has, during any time in the six-year period
preceding the Closing Date, contributed to, sponsored, maintained
or administered any “employee pension benefit plan”
within the meaning of Section 3(2) of ERISA that is or was
subject to Title IV of ERISA or Section 412 of the
Code.
(b)
The execution and
delivery of this Agreement and the other Transaction Documents and
the consummation of the Transactions will not (i) result in
any payment (including severance, unemployment
compensation,
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golden parachute, bonus
or otherwise) becoming due to any stockholder, director or employee
of the Company or (ii) result in the acceleration of the time
of payment or vesting of any such benefits.
Section 4.15
Required Votes of
the Company’s Stockholders and Warrantholders
. Other than the
Company Stockholder Approval and Company Warrantholder Approval, no
approval of the Company Stockholders or Company Warrantholders is
required in connection with the Transactions.
Section 4.16
Trust
Account .
(a)
As of March 31, 2009,
the Company has $249,434,399, including interest thereon, held in
the Trust Account. Amounts in the Trust Account are invested in
United States Government securities or in money market funds
meeting certain conditions under Rule 2a-7 promulgated under the
Investment Company Act of 1940, as amended. The Company has
performed all material obligations required to be performed by it
to date under, and is not in material default or delinquent in
performance or any other respect (claimed or actual) in connection
with, the Trust Agreement, and no event has occurred which, with
due notice or lapse of time or both, would constitute such a
default thereunder. There are no claims or proceedings
pending with respect to the Trust Account. Since March 31,
2009, the Company has not released any money from the Trust
Account, other than amounts permitted under the Trust
Agreement.
(b)
As of the Effective
Time, the obligations of the Company to dissolve or liquidate shall
terminate, and as of the Effective Time, the Company shall have no
obligation whatsoever to dissolve and liquidate the assets of the
Company by reason of the consummation of the Transactions, and
following the Effective Time, no Company Stockholder shall be
entitled to receive any amount from the Trust Account except to the
extent such Company Stockholder is a Converting
Stockholder.
Section 4.17
Brokers
. No broker,
investment banker, financial advisor or other Person is entitled to
any broker’s, finder’s, financial advisor’s or
other similar fee or commission in connection with the Transactions
based upon arrangements made by or on behalf of the
Company.
Section 4.18
Disclosure . No representation or
warranty contained in this Agreement or any other Transaction
Document, and no statement contained in the Company Disclosure
Schedule or in any certificate, list or other writing furnished by
the Company pursuant to this Agreement, contains any untrue
statement of a material fact or omits a material fact necessary to
make the statements contained herein or therein, in the light of
the circumstances under which they were made, not
misleading.
Section 4.19
Section 203 of
the DGCL .
Prior to the date of this Agreement, the Company’s
board of directors has taken all action necessary to ensure that
the restrictions on business combinations contained in
Section 203 of the DGCL will not apply with respect to or as a
result of this Agreement, the Sponsors' Voting and Support
Agreement or the transactions contemplated hereby (including
without limitation the Merger) and thereby.
Section 4.20
No Additional
Representations . Except for the
representations and warranties made by the Company in this
Article IV or pursuant to the certificate to be delivered
pursuant to Section 7.3(d) , neither the Company nor
any other person makes any representation or warranty with respect
to the Company (or its business, operations, assets, liabilities,
condition (financial or otherwise) or prospects).
ARTICLE V
REPRESENTATIONS AND
WARRANTIES OF
PARENT AND MERGER
SUB
Parent and Merger Sub
jointly and severally represent and warrant to the Company as
follows:
Section 5.1
Organization
. Each of Parent
and Merger Sub is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
formation and has all requisite power and authority to own,
license, use, lease and operate its assets and properties and to
carry on its business as now being conducted, except where the
failure to be so organized, existing and in good standing or to
have such power and authority would not be reasonably expected to
prevent or materially delay the consummation of the
Merger.
Section 5.2
Capitalization
.
(a)
The authorized capital
stock of Parent consists of 900,000,000 Parent Shares and
90,000,000 shares of preferred stock. At the close of
business on the date of this Agreement, (i) twenty (20) Parent
Shares were issued and outstanding and (ii) no shares of
preferred stock were issued and outstanding. All outstanding
shares of capital stock of Parent have been duly authorized and
validly issued and are fully paid and nonassessable and have not
been issued in
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violation of any
preemptive or similar rights. Except as set forth above in this
Section 5.2(a) there are no outstanding (x) shares
of capital stock or other voting securities of Parent,
(y) securities of Parent convertible into or exchangeable for
shares of capital stock or other securities of the Company or
(z) subscriptions, options, warrants, puts, calls, phantom
stock rights, stock appreciation rights, stock based performance
units, agreements, understanding, claims or other commitments or
rights of any type granted or entered into by Parent relating to
the issuance, sale, repurchase or transfer of any securities of
Parent or that give any Person or entity the right to receive any
economic benefit or right similar to or derived from the economic
benefits and rights of securities of Parent. There are no
outstanding obligations of Parent to repurchase, redeem or
otherwise acquire any securities of Parent or to vote or to dispose
of any shares of the capital stock of Parent.
(b)
The Parent Shares to be
issued in the Merger will, upon such issuance, be validly issued,
fully paid and non-assessable.
(c)
The authorized capital
stock of Merger Sub consists of one hundred (100) shares of common
stock and no shares of preferred stock. At the close of
business on the date of this Agreement, one hundred (100)
shares of common stock were issued and outstanding. All
outstanding shares of capital stock of Merger Sub are owned
beneficially and of record by Parent, have been duly authorized and
validly issued and are fully paid and nonassessable and have not
been issued in violation of any preemptive or similar rights.
Except as set forth above in this Section 5.2(c)
there are no outstanding (x) shares of capital stock or other
voting securities of Merger Sub, (y) securities of Merger Sub
convertible into or exchangeable for shares of capital stock or
other securities of the Company or (z) subscriptions, options,
warrants, puts, calls, phantom stock rights, stock appreciation
rights, stock based performance units, agreements, understanding,
claims or other commitments or rights of any type granted or
entered into by Merger Sub relating to the issuance, sale,
repurchase or transfer of any securities of Merger Sub or that give
any Person or entity the right to receive any economic benefit or
right similar to or derived from the economic benefits and rights
of securities of Merger Sub. There are no outstanding
obligations of Merger Sub to repurchase, redeem or otherwise
acquire any securities of Merger Sub or to vote or to dispose of
any shares of the capital stock of Merger Sub.
Section 5.3
Authority;
Approval .
Each of Parent and Merger Sub has all requisite power and
authority to execute and deliver this Agreement, the Transaction
Documents to which it is a party and to perform and consummate the
Transactions. The execution, delivery and performance of this
Agreement, the Transaction Documents to which it is a party and the
consummation of the Transactions have been duly authorized by all
necessary corporate or other action on the part of Parent and
Merger Sub and no corporate or other proceedings on the part of
Parent or Merger Sub are necessary to authorize this Agreement, the
Transaction Documents to which it is a party or to consummate the
Transactions. No vote of Parent’s stockholders is
required to approve this Agreement or the Transactions. This
Agreement has been duly executed and delivered by Parent and Merger
Sub, as the case may be, and, assuming due execution and delivery
by the Company, constitutes a valid and binding obligation of each
of Parent and Merger Sub enforceable against them in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and
to general equity principles.
Section 5.4
Consents and
Approvals; No Violations .
(a)
The execution, delivery
and performance by Parent and Merger Sub of this Agreement, the
Transaction Documents to which it is a party and the consummation
by Parent and Merger Sub of the Transactions do not and will not
require any filing or registration with, notification to, or
authorization, permit, consent or approval of, or other action by
or in respect of, any Governmental Authority other than
(i) the filing of the Certificate of Merger as contemplated by
Article II hereof, (ii) compliance with any applicable
requirements of the Securities Act and the Exchange Act,
(iii) compliance with any applicable requirements of the NYSE
Amex and (iv) compliance with any state securities, takeover
and “blue sky” laws.
(b)
The execution, delivery
and performance by Parent and Merger Sub of this Agreement, the
Transaction Documents to which it is a party and the consummation
by Parent and Merger Sub of the Transactions do not and will not
(i) conflict with or result in any breach of any provision of
the certificate of incorporation or bylaws of Parent and Merger
Sub, (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default
under, or give rise to any right of termination, amendment,
cancellation, acceleration or loss of benefits under, or result in
the creation of any Lien upon any of the properties or assets of
Parent or Merger Sub under, any of the terms, conditions or
provisions of any Contract to which Parent or Merger Sub is a party
or by which any of their respective properties or assets may be
bound or (iii) violate any judgment, order, writ, preliminary
or permanent injunction or decree or any statute, law, ordinance,
rule or regulation of any Governmental Authority applicable to
Parent or Merger Sub, or any of their respective properties or
assets, except in the case of clauses (ii) or (iii) for
violations, breaches or defaults that would not reasonably be
expected to prevent or materially delay the consummation of the
Transactions.
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Section 5.5
New Company/No
Operations of Parent and Merger Sub . Parent was incorporated in
February of 2008. Merger Sub was incorporated in July of 2009.
Neither Parent (other than Merger Sub) nor Merger Sub have
any subsidiaries or otherwise own any equity interests in any
Person. Since their respective inceptions, neither Parent nor
Merger Sub has engaged in any activity or entered into any
Contract, other than such actions incident to (i) its
organization and (ii) the preparation, negotiation and
execution of this Agreement, the Ancillary Agreements, and the
Transactions. Neither Parent nor Merger Sub has had any
operations or generated any revenues or has any liabilities other
than those incurred in connection with the foregoing and in
association with the Transactions as provided in this
Agreement.
Section 5.6
Litigation . There are no material suits,
claims, actions, proceedings or investigations pending or, to the
knowledge of Parent, threatened, before any Governmental Authority
of any nature, brought by or against any of Parent or Merger Sub
or, to the knowledge of Parent, any of its respective officers or
directors involving or relating to Parent or the assets, properties
or rights of Parent, Merger Sub or the Transactions. There is
no material judgment, decree, injunction, rule or order of any
Governmental Authority of any nature outstanding or, to the
knowledge of Parent or Merger Sub, threatened against Parent or
Merger Sub.
Section 5.7
Brokers
. Except as
otherwise set forth on Schedule 5.7 , no broker, investment
banker, financial advisor or other Person is entitled to any
broker’s, finder’s, financial advisor’s or other
similar fee or commission in connection with the Transactions based
upon arrangements made by or on behalf of Parent or Merger
Sub.
Section 5.8
REIT
.
(a)
Parent’s taxable
year will be the calendar year. As of March 31, 2009,
Parent’s only assets consisted of Five Hundred Eighty Eight
Dollars ($588) held in a bank checking account of Parent. Prior to
the Effective Time, Merger Sub will have held no material
assets.
(b)
Commencing with its
taxable year ending December 31, 2009, Parent has been organized in
a manner consistent with the requirements for qualification and
taxation as a REIT under the Code and Parent intends to operate in
a manner that will enable it to meet the requirements for
qualification and taxation as a REIT under the Code.
Section 5.9
Tax
Matters .
(a)
All U.S. federal and
state income Tax Returns and all other material Tax Returns
required to be filed with any taxing authority by, or with respect
to Parent and Merger Sub have been filed in accordance with all
applicable law, and such Tax Returns are true, correct and complete
in all material respects. Parent or Merger Sub has timely paid all
Taxes shown as due and payable on such Tax Returns or that are
otherwise due. Each of Parent and Merger Sub has made provision for
all material Taxes payable by it for which no Tax Return has yet
been filed.
(b)
There is no action,
suit, proceeding, audit or claim now pending or, to the knowledge
of Parent, threatened against or with respect to Parent or Merger
Sub in respect of any Tax and no taxing authority has given written
notice of the commencement of any audit, examination or deficiency
action with respect to any such Taxes.
(c)
Each of Parent and
Merger Sub has withheld and paid all Taxes required to have been
withheld and paid in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other
third party. Each of Parent and Merger Sub has not made any
payments, is not obligated to make any payments and is not a party
to any agreement that under certain circumstances could obligate it
to make any payments that will not be deductible under
Section 162(m) or 280G of the Code.
(d)
There are no
outstanding Contracts or waivers extending the statutory period of
limitations applicable to any claim for, or the period for the
collection or assessment of, material Taxes of Parent or Merger Sub
due for any taxable period.
(e)
Each of Parent and
Merger Sub has not received written notice of any claim, and, to
the knowledge of Parent, no claim has ever been made, by any taxing
authority in a jurisdiction where Parent or Merger Sub does not
file Tax Returns that Parent or Merger Sub is or may be subject to
taxation by that jurisdiction.
(f)
Each of Parent and
Merger Sub has not requested, nor is the subject of or bound by,
any private letter ruling, technical advise memorandum, closing
agreement or similar ruling, memorandum or agreement with any
taxing authority with respect to any material Taxes, nor is any
such request outstanding.
(g)
Each of Parent and
Merger Sub has not participated in a “listed
transaction,” as defined in Treasury Regulation §
1.6011-4(b)(2).
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Section 5.10
No Additional
Representations . Except for the
representations and warranties made by Parent and Merger Sub in
this Article V or pursuant to the certificate to be
delivered pursuant to Section 7.2(d) , neither the
Parent or Merger Sub nor any other Person makes any representation
or warranty with respect to Parent or Merger Sub.
ARTICLE VI
COVENANTS
Section 6.1
Conduct of the
Parties .
(a)
From the date hereof
until the earlier to occur of the Effective Time or the termination
of this Agreement pursuant to its terms, except as expressly
permitted by this Agreement, consented to in writing by the Parent
(which consent shall not be unreasonably withheld), or required by
applicable Law or the rules and regulations of the NYSE Amex, the
Company (i) shall conduct its business in the ordinary course,
(ii) shall use commercially reasonable efforts to
(x) preserve intact its present business organization and
relationships with third parties, (y) maintain in effect all
of its Permits and (z) keep available the services of its
present directors, officers and employees and (iii) shall
not:
(i)
except in connection
with the Proposed Charter Amendment, amend its certificate of
incorporation or bylaws (whether by merger, consolidation or
otherwise);
(ii)
split, combine or
reclassify any shares of capital stock or other equity securities
of the Company or declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any combination
thereof) in respect of the capital stock or other equity securities
of the Company (other than the Enterprise Distribution), or redeem,
repurchase or otherwise acquire or offer to redeem, repurchase, or
otherwise acquire any capital stock or other equity securities of
the Company;
(iii)
(x) issue, deliver or
sell, or authorize the issuance, delivery or sale of, any capital
stock, warrant or other equity securities of the Company, or
(y) amend any term of any capital stock or other equity
securities of the Company (in each case, whether by merger,
consolidation or otherwise);
(iv)
except as set forth in
Section 6.17 , acquire (by merger, consolidation,
acquisition of stock or assets or otherwise), directly or
indirectly, any material assets, securities, properties, or
businesses, other than in the ordinary course of
business;
(v)
sell, lease or
otherwise transfer, or create or incur any Lien on, any assets,
securities, properties, or businesses of the Company, other than in
the ordinary course of business;
(vi)
make any material
loans, advances or capital contributions to, or investments in, any
other Person;
(vii)
create, incur, assume,
suffer to exist or otherwise be liable with respect to any
indebtedness for borrowed money or guarantees thereof;
(viii)
enter into any hedging
arrangements;
(ix)
enter into or amend any
Company Contract (with the exception of any agreement or
arrangement with financial, legal, accounting, tax and other
professional advisors);
(x)
enter into any
agreement or arrangement that limits or otherwise restricts in any
respect the Company or any successor thereto or that could, after
the Closing Date, limit or restrict in any respect Parent or the
Company, from engaging or competing in any line of business, in any
location or with any Person or, except in the ordinary course of
business, otherwise waive, release or assign any material rights,
claims or benefits of the Company;
(xi)
increase compensation,
bonus or other benefits payable to any director, officer or
employee of the Company;
(xii)
change the
Company’s methods of accounting, except as required by
concurrent changes in Law or GAAP;
(xiii)
settle, or offer or
propose to settle, any material litigation, investigation,
arbitration, proceeding or other claim involving or against the
Company, including any litigation, arbitration, proceeding or
dispute that relates to the Transactions;
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(xiv)
make or change any
material Tax election, change any annual Tax accounting period,
adopt or change any method of Tax accounting, materially amend any
Tax Returns or file claims for material Tax refunds, enter any
material closing agreement, settle any material Tax claim, audit or
assessment, or surrender any right to claim a material Tax refund,
offset or other reduction in Tax liability, or take any action (or
fail to take any action) that could prevent Parent from qualifying
as a REIT;
(xv)
take any action or omit
to take any action that is reasonably likely to result in any of
the conditions set forth in Article VII not being
satisfied;
(xvi)
take any action to
exempt or make not subject to or to otherwise waive or cause to be
inapplicable the provisions of Section 203 of the DGCL or any
other state takeover law or state law that purports to limit or
restrict business combinations or the ability to acquire or vote
shares, in each case to any individual or entity (other than Parent
or its subsidiaries), or any action taken thereby, which
individual, entity or action would have otherwise been subject to
the restrictive provisions thereof and not exempt therefrom;
or
(xvii)
agree, resolve or
commit to do any of the foregoing.
(b)
From the date hereof
until the earlier to occur of the Effective Time or the termination
of this Agreement pursuant to its terms, except as expressly
permitted by this Agreement, consented to in writing by the Company
(which consent shall not be unreasonably withheld), or required by
applicable Law, each of Parent and Merger Sub shall not:
(i)
amend its certificate
of incorporation or bylaws (whether by merger, consolidation or
otherwise);
(ii)
split, combine or
reclassify any shares of capital stock or other equity securities
of Parent or Merger Sub or declare, set aside or pay any dividend
or other distribution (whether in cash, stock or property or any
combination thereof) in respect of the capital stock or other
equity securities of Parent or Merger Sub, or redeem, repurchase or
otherwise acquire or offer to redeem, repurchase, or otherwise
acquire any capital stock or other equity securities of Parent or
Merger Sub;
(iii)
issue, deliver or sell,
or authorize the issuance, delivery or sale of, any capital stock,
warrant or other equity securities of Parent or Merger Sub, or
amend any term of any capital stock or other equity securities of
Parent or Merger Sub (in each case, whether by merger,
consolidation or otherwise);
(iv)
except as contemplated
by this Agreement, acquire (by merger, consolidation, acquisition
of stock or assets or otherwise), directly or indirectly, any
assets, securities, properties, or businesses;
(v)
sell, lease or
otherwise transfer, or create or incur any Lien on, any assets,
securities, properties, or businesses of Parent or Merger
Sub;
(vi)
make any loans,
advances or capital contributions to, or investments in, any other
Person;
(vii)
create, incur, assume,
suffer to exist or otherwise be liable with respect to any
indebtedness for borrowed money or guarantees thereof;
(viii)
enter into any hedging
arrangements;
(ix)
enter into or amend any
material contract (with the exception of any agreement or
arrangement with financial, legal, accounting, tax and other
professional advisors);
(x)
enter into any
agreement or arrangement that limits or otherwise restricts in any
respect the Company, or any successor thereto or that could, after
the Closing Date, limit or restrict in any respect Parent, Merger
Sub or the Surviving Company, from engaging or competing in any
line of business, in any location or with any Person or otherwise
waive, release or assign any material rights, claims or benefits of
Parent or Merger Sub;
(xi)
increase compensation,
bonus or other benefits payable to any director, officer or
employee of Parent;
(xii)
change Parent’s
or Merger Sub’s methods of accounting, except as required by
concurrent changes in Law or GAAP;
(xiii)
settle, or offer or
propose to settle, any material litigation, investigation,
arbitration, proceeding or other claim involving or against Parent
or Merger Sub, including any litigation, arbitration, proceeding or
dispute that relates to the Transactions;
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(xiv)
make or change any
material Tax election, change any annual Tax accounting period,
adopt or change any method of Tax accounting, materially amend any
Tax Returns or file claims for material Tax refunds, enter any
material closing agreement, settle any material Tax claim, audit or
assessment, or surrender any right to claim a material Tax refund,
offset or other reduction in Tax liability;
(xv)
take any action or omit
to take any action that is reasonably likely to result in any of
the conditions set forth in Article VII not being
satisfied;
(xvi)
take any action to
exempt or make not subject to or to otherwise waive or cause to be
inapplicable the provisions of any state takeover law or state law
(including without limitation the Delaware General Corporation Law)
that purports to limit or restrict business combinations or the
ability to acquire or vote shares, in each case to any individual
or entity (other than Parent or Merger Sub), or any action taken
thereby, which individual, entity or action would have otherwise
been subject to the restrictive provisions thereof and not exempt
therefrom; or
(xvii)
agree, resolve or
commit to do any of the foregoing.
Section 6.2
No
Solicitation . From the date hereof until
the Effective Time:
(a)
The Company shall, and
shall cause its officers, directors, employees, representatives and
agents, including the Sponsors, to immediately cease any
activities, discussions or negotiations with any parties that may
be ongoing with respect to an Acquisition Proposal, and request the
return or destruction of all confidential information regarding the
Company provided to any such persons on or prior to the date of
this Agreement pursuant to the terms of any confidentiality
agreements or otherwise. The Company shall not, and shall
cause its officers, directors, employees, representatives and
agents, including the Sponsors, not to, directly or indirectly,
(i) solicit, participate in, initiate or encourage (including
by way of furnishing information), or take any other action
designed or reasonably likely to facilitate or encourage any
inquiries or the making of any proposal that constitutes, or may
reasonably be expected to lead to, any Acquisition Proposal or
(ii) participate in any discussions or negotiations (including
by way of furnishing information) regarding any Acquisition
Proposal; provided , however , that, at any time
prior to the Company Stockholder Approval, in response to an
Acquisition Proposal received by the Company (other than as a
result of a material breach by the Company of this
Section 6.2 ) after the date hereof that the board of
directors of the Company determines in good faith, after
consultation with its legal and financial advisors, may reasonably
be expected to lead to a Superior Proposal, and subject to
compliance with the following provisions of this
Section 6.2 , (x) furnish information with respect
to the Company to the person making such Superior Proposal pursuant
to a confidentiality agreement and (y) participate in
discussions or negotiations regarding such Acquisition
Proposal.
(b)
Except as set forth in
this Section 6.2 , neither the board of directors of
the Company nor any committee thereof shall (i) make or
publicly propose to make a Change in Recommendation,
(ii) approve or recommend or take no position with respect to,
or publicly propose to approve or recommend or take no position
with respect to, an Acquisition Proposal or (iii) cause the
Company to enter into any agreement related to any Acquisition
Proposal (other than a confidentiality agreement as contemplated by
Section 6.2(a) ). Notwithstanding the foregoing, if
prior to the Company Stockholder Approval the board of directors of
the Company determines in good faith, after consultation with
outside counsel that it is required to do so to comply with its
fiduciary duties to the Company Stockholders under applicable law,
the board of directors of the Company may, provided that the
Company has complied in all material respects with its obligations
under this Section 6.2(b) , in response to a Superior
Proposal that was received by the Company after the date hereof,
(x) make a Change in Recommendation or (y) in the event
the Company enters into any agreement related to any Acquisition
Proposal (other than a confidentiality agreement as contemplated by
Section 6.2(a) ) pursuant to (iii) above,
terminate this Agreement, but in each such case only at a time that
is after the third business day following Parent’s receipt of
written notice advising Parent that the board of directors of the
Company has received a Superior Proposal, specifying the material
terms and conditions of such Superior Proposal and identifying the
person making such Superior Proposal, and with regard to (y), only
if the Company is in compliance in all material respects with
Sections 6.2 , 8.1(d) and 8.3 and
simultaneously with taking such action it terminates this Agreement
and also executes a definitive agreement to implement such Superior
Proposal.
(c)
The Company shall
promptly advise Parent orally and in writing of any request for
information or of any Acquisition Proposal, the material terms and
conditions of such request or Acquisition Proposal and the identity
of the person making such request or Acquisition Proposal.
The Company will keep Parent reasonably informed on a
reasonably current basis of any material change in the details
(including amendments) of any such request or Acquisition Proposal.
The Company will promptly provide Parent with any documents
received from any such person and promptly provide Parent such
information as it may reasonably request.
(d)
Nothing contained in
this Section 6.2 shall prohibit the Company from taking
and disclosing to its stockholders a position contemplated by Rule
14e-2 or Rule 14d-9 promulgated under the Exchange Act or from
making any disclosure to the Company’s stockholders if, in
the good faith judgment of the board of directors of the Company,
after
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consultation with
outside counsel, failure so to disclose would be inconsistent with
applicable law; provided , however , that any Change
in Recommendation included in such public disclosure shall be
subject to Section 8.1(c) .
(e)
The parties hereto
agree that irreparable damage would occur in the event that the
provisions of this Section 6.2 were not performed in
accordance with their specific terms or were otherwise breached.
It is accordingly agreed by the parties hereto that Parent
shall be entitled to an immediate injunction or injunctions,
without the necessity of proving the inadequacy of money damages as
a remedy and without the necessity of posting any bond or other
security, to prevent breaches of the provisions of this
Section 6.2 and to enforce specifically the terms and
provisions hereof in any court of the United States or any state
having jurisdiction, specific performance being the sole remedy
with respect to this Section 6.2 if it is available.
Without limiting the foregoing, it is understood that any
violation of the restriction set forth above by any officer,
director, employee, investment banker, attorney, accountant,
consultant or other agent or advisor of the Company or any Sponsor
shall be deemed to be a breach of this Agreement by the
Company.
Section 6.3
Proxy
Statement/Prospectus; S-4 Registration Statement; Information
Supplied .
(a)
The Company and Parent
shall prepare the Proxy Statement/Prospectus (as defined below),
and Parent shall prepare and file with the SEC a Registration
Statement on Form S-4 in connection with the Company Stockholder
Meeting and Company Warrantholder Meeting and the issuance of
Parent Shares and the conversion of the Warrants pursuant to the
Merger (including the joint proxy statement and prospectus (the
“ Proxy Statement/Prospectus ”) constituting a
part thereof) (the “ S-4 Registration Statement
”) in each case as promptly as practicable following the date
of this Agreement. The Company and Parent shall use their
respective reasonable best efforts to respond to any comments made
by the SEC, and Parent shall use its reasonable best efforts to
have the S-4 Registration Statement declared effective by the SEC,
in each case as promptly as practicable after such filing, and
promptly thereafter the Company shall mail the Proxy
Statement/Prospectus to the shareholders and warrantholders of the
Company.
(b)
The Company and Parent
each agrees that none of the information supplied or to be supplied
by it for inclusion or incorporation by reference in (i) the
S-4 Registration Statement will, at the time the S-4 Registration
Statement becomes effective under the Securities Act, 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, and (ii) the Proxy
Statement/Prospectus and any amendment or supplement thereto will,
at the date of mailing to shareholders and at the time of the
meeting of shareholders of the Company to be held in connection
with the Transactions, contain any 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. Parent will cause the S-4 Registration Statement
to comply as to form in all material respects with the applicable
provisions of the Securities Act and the rules and regulations
thereunder.
Section 6.4
Stockholders and
Warrantholders Meeting .
(a)
The Company will take,
in accordance with applicable Law and its Certificate of
Incorporation and Bylaws, all action necessary to convene a meeting
of holders of Shares (the “ Company Stockholders
Meeting ”) and Warrants (the “ Company
Warrantholders Meeting ”) as promptly as practicable
after the S-4 Registration Statement is declared effective to
obtain the Company Stockholder Approval and Company Warrantholder
Approval. Subject to Section 6.2 hereof, the Company
Recommendation shall be included in the Proxy Statement/Prospectus
and the Company’s board of directors shall otherwise
recommend in favor of granting the Company Stockholder Approval and
shall take all lawful action to solicit such approval.
(b)
If on the date of the
Company Stockholders Meeting and Company Warrantholders Meeting the
Company has not received proxies representing a sufficient number
of Shares to obtain the Company Stockholder Approval and Company
Warrantholder Approval, respectively, then the Company shall, if
requested by Parent, adjourn the Company Stockholders Meeting and
Company Warrantholders Meeting until such date or dates as shall be
specified by Parent, and subject to the terms and conditions of
this Agreement shall continue to use its reasonable best efforts,
together with its proxy solicitor, to assist in the solicitation of
proxies from stockholders with a view towards obtaining the Company
Stockholders Approval and Company Warrantholder
Approval.
Section 6.5
Filings; Other
Actions; Notification .
(a)
The Company and Parent
each shall, upon request by the other, furnish the other with all
information concerning itself, its officers, directors and
shareholders and such other matters as may be reasonably necessary
or advisable in connection with the Proxy Statement/Prospectus, the
S-4 Registration Statement or any other statement, filing, notice
or application made by or on behalf of Parent or the Company to any
third party and/or any Governmental Authority in connection with
the Transactions. Parent shall use commercially reasonable
efforts to deliver audited financial statements of
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Parent as soon as
practicable to the Company and to incorporate such audited
financial statements into the S-4 Registration
Statement.
(b)
Subject to applicable
Law, the Company and Parent each shall (i) keep the other
apprised of the status of matters relating to completion of the
Transactions, including promptly furnishing the other with copies
of notices or other communications received by Parent or the
Company, as the case may be, from any third party and/or any
Governmental Authority with respect to the Transactions and
(ii) provide each other, if reasonable under the
circumstances, with an opportunity to review and comment on any
written communication (and participate in any meetings) with any
such third party and/or any Governmental Authority. The
Company and Parent each shall give prompt notice to the other of
any change that is reasonably likely to result in a Material
Adverse Effect on the Company or Parent or a material delay in any
party’s ability to consummate the transactions contemplated
hereby, as applicable, or of any failure to the other party’s
conditions set out in Article VII .
Section 6.6
Access to
Information . The Company and Parent each
shall, upon request by the other, furnish the other with all
information concerning themselves, their respective directors,
officers, stockholders and partners and such other matters as may
be reasonably necessary or advisable in connection with the
Transactions, or any other statement, filing, notice or application
made by or on behalf of the Company and Parent to any third party
and/or any Governmental Authority in connection with the
Transactions.
Section 6.7
Further
Assurances .
Subject to the terms and conditions hereof, each of the
parties hereto shall use its commercially reasonable efforts to
fulfill or obtain the fulfillment of the conditions precedent to
the consummation of the Transactions contemplated hereby, including
the execution and delivery of any documents, certificates,
instruments or other papers that are reasonably required for the
consummation of the Transactions contemplated hereby.
Section 6.8
Commercially
Reasonable Efforts . Upon the terms and subject
to the conditions set forth in this Agreement and except where a
different standard is expressly applicable, each of the parties
agrees to use commercially reasonable efforts to take, or cause to
be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other parties in doing, all things
necessary, proper or advisable to consummate and make effective, in
the most expeditious manner practicable, the Transactions,
including using commercially reasonable efforts to accomplish the
following: (i) the taking of all reasonable acts necessary to
cause the conditions precedent set forth in Article VII to
be satisfied; (ii) the obtaining of all consents, approvals or
waivers from third parties required to consummate the Transactions;
(iii) the defending against any lawsuits, actions or
proceedings, judicial or administrative, challenging this Agreement
or the consummation of the Transactions, and seeking to have any
preliminary injunction, temporary restraining order, stay or other
legal restraint or prohibition entered or imposed by any court or
other Governmental Authority that is not yet final and
nonappealable vacated or reversed; and (iv) the execution or
delivery of any additional instruments reasonably necessary to
consummate the Transactions, and to fully carry out the purposes of
this Agreement, including, without limitation, providing
certificates as to factual matters in connection with legal
opinions.
Section 6.9
Indemnification;
Directors’ and Officers’ Insurance
.
(a)
From and after the
Effective Time, each of Parent and the Surviving Company agrees
that it will (i) indemnify and hold harmless, to the extent
the Company is obligated to indemnify and hold harmless such
Persons as of the date of this Agreement (and Parent and the
Surviving Company shall also advance expenses as incurred to the
extent the Company is obligated to advance such expenses as of the
date of this Agreement, provided the Person to whom expenses are
advanced provides an undertaking to repay such advances if it is
ultimately determined that such Person is not entitled to
indemnification), each present and former director and officer of
the Company (in each case, when acting in such capacity) (the
“ Indemnified Parties ”), against any costs or
expenses (including reasonable attorneys’ fees), judgments,
fines, settlements, losses, claims, damages or liabilities
(collectively, “ Costs ”) incurred in connection
with any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative, arising out of matters existing or occurring at or
prior to the Effective Time, whether asserted or claimed prior to,
at or after the Effective Time, including the Transactions and
(ii) include and cause to be maintained in effect in the
Surviving Company’s (or any successor’s) constitutional
documents after the Effective Time provisions regarding the
elimination of liability of directors and officers and the
indemnification of the Indemnified Parties that are no less
advantageous to the intended beneficiaries than the corresponding
provisions contained in the current certificate of incorporation
and bylaws of the Company.
(b)
Prior to the Effective
Time, the Company shall, and if the Company is unable to, Parent
shall, cause the Surviving Company, as of the Effective Time, to
obtain and fully pay for “tail” insurance policies with
a claims period of six (6) years from and after the Effective Time
from one or more insurance carriers with the same or better credit
rating as the Company’s current insurance carriers with
respect to directors’ and officers’ liability insurance
and fiduciary liability insurance (collectively, “ D&O
Insurance ”) with benefits and levels of coverage at
least as favorable as the Company’s existing policies with
respect to matters existing or occurring at or prior to the
Effective Time (including in
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connection with this
Agreement or the transactions or actions contemplated hereby). If
the Company and the Surviving Company for any reason fail to obtain
such “tail” insurance policies as of the Effective
Time, the Surviving Company shall, and Parent shall cause the
Surviving Company to, continue to maintain in effect for a period
of six (6) years from and after the Effective Time the D&O
Insurance in place as of the date hereof with benefits and levels
of coverage at least as favorable as provided in the
Company’s existing policies as of the date hereof, or the
Surviving Company shall, and Parent shall cause the Surviving
Company to, purchase comparable D&O Insurance for such six
(6)-year period with benefits and levels of coverage at least as
favorable as provided in the Company’s existing policies as
of the date hereof; provided , however , that in no
event shall Parent or the Surviving Company be required to expend
for such policies an annual premium amount in excess of two hundred
fifty percent (250%) of the annual premiums currently paid by the
Company for such insurance; and, provided further
that if the annual premiums of such insurance coverage exceed such
amount, the Surviving Company shall obtain a policy with the
greatest coverage available for a cost not exceeding such
amount.
(c)
If Parent or the
Surviving Company or any of their respective successors or assigns
(i) shall consolidate with or merge into any other corporation
or entity and shall not be the continuing or surviving entity of
such consolidation or merger or (ii) shall transfer all or
substantially all of its properties and assets to any Person, then,
and in each such case, proper provisions shall be made so that the
successors and assigns of Parent or the Surviving Company shall
assume all of the obligations set forth in this
Section 6.9 .
(d)
The provisions of this
Section 6.9 are intended to be for the benefit of, and
shall be enforceable by, each of the Indemnified
Parties.
(e)
The rights of the
Indemnified Parties under this Section 6.9 shall be in
addition to any rights such Indemnified Parties may have under the
Amendment and Restated Certificate of Incorporation or Bylaws of
the Company, or under any applicable Contracts or Laws.
Section 6.10
Affiliates . At least forty-five (45)
days prior to the Company Stockholders Meeting (with updates
thereafter as appropriate), the Company shall deliver to Parent a
letter identifying each Person who may be deemed an
“affiliate” of the Company for purposes of Rule 145
under the Securities Act. The Company shall use its
reasonable best efforts to obtain a written agreement from each
Person who may be so deemed as soon as practicable and, in any
event, at least thirty (30) days prior to the Company Stockholders
Meeting, substantially in the form of Exhibit F
hereto.
Section 6.11
Certain
Litigation .
The Company shall give the Parent a reasonable opportunity to
consult in the defense of any stockholder litigation against the
Company and its directors relating to the Transactions. In
addition, the Company shall not voluntarily cooperate with any
third party that may hereafter seek to restrain or prohibit or
otherwise oppose the Sponsors' Voting and Support Agreement, the
Proposed Charter Amendment, the Business Combination, the Merger,
this Agreement or the Transactions and Parent and the Company shall
cooperate to resist any such effort to restrain or prohibit or
otherwise oppose the Sponsors' Voting and Support Agreement, the
Proposed Charter Amendment, the Business Combination, the Merger,
this Agreement or the Transactions.
Section 6.12
Public
Disclosure .
From the date of this Agreement until the earlier to occur of
the Effective Time or the termination of this Agreement pursuant to
its terms, the parties shall cooperate in good faith to jointly
prepare all press releases and public announcements pertaining to
this Agreement and the Transactions, and no party shall issue or
otherwise make any public announcement or communication pertaining
to this Agreement or the Transactions without the prior consent of
Parent (in the case of the Company) or the Company (in the case of
Parent), except as required by any Laws or by the rules and
regulations of, pursuant to any agreement with the NYSE Amex, or to
the extent such information was previously disclosed in a public
announcement or communication permitted under this
Section 6.13 . Each party will not unreasonably
withhold approval from the others with respect to any press release
or public announcement. If any party determines that it is
required by any Laws or by the rules and regulations of, or
pursuant to any agreement with, the NYSE Amex, to make this
Agreement and the terms of the Transactions public or otherwise
issue a press release or make public disclosure with respect
thereto, it shall, to the extent permitted by Law, at a reasonable
time before making any public disclosure, consult with the other
party regarding such disclosure and give the other party reasonable
time to comment on such release or announcement in advance of such
issuance. This provision will not apply to communications by
any party to its counsel, accountants and other professional
advisors.
Section 6.13
Listing
. Prior to the
Effective Time, Parent shall use its reasonable best efforts to
cause the Parent Shares to be issued in connection with the Merger
to be listed on the NYSE or NYSE Amex, subject to official notice
of issuance, as of or prior to the Effective Time.
Section 6.14
Section 16
Matters .
Prior to the Effective Time, Parent and the Company shall
take all reasonable steps as may be required or permitted to cause
any dispositions of the Shares and Warrants that occur or are
deemed to occur by reason of or pursuant to the Transactions by
each individual who is or will be subject to the reporting
requirements of
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Section 16(a) of
the Exchange Act with respect to the Company to be exempt under
Rule 16b-3 promulgated under the Exchange Act.
Section 6.15
Trust
Account .
(a)
Immediately upon the
Effective Time, the Company shall cause the Trust Account to be
disbursed to pay (i) Company Stockholders with whom the
Company may enter into forward or other contracts to purchase their
Shares, (ii) the deferred underwriters’ compensation
owed by the Company in connection with the IPO, (iii) expenses
of the Sponsors incurred on behalf of the Company, and
(iv) third parties (e.g., professionals, printers, etc.) who
have rendered and/or will render services to the Company in
connection with its operations and efforts to effect a business
combination, including the Merger, (v) on account of any
Company Tax Liabilities, (vi) any Expenses incurred by
shareholders of Parent or its Affiliates in connection with the
Transactions and the Transaction Documents, (vii) up to
$2,450,000 of committed expenses and obligations of the Company and
(viii) the cost of D&O Insurance obtained in accordance
with Section 6.9 hereof.
(b)
Immediately upon the
Effective Time, the Company shall disburse of the balance of the
funds held in the Trust Account as directed by Parent in writing,
to pay Converting Shareholders and to be used by Parent and the
Company for working capital requirements.
(c)
Notwithstanding
anything in this Agreement to the contrary, each of Parent and
Merger Sub acknowledges that it has read the Company’s final
prospectus dated November 7, 2007, and understands that the Company
has established the Trust Account for the benefit of the Public
Stockholders and that the Company may disburse monies from the
Trust Account only (a) to the Public Stockholders in the event
they elect to convert their shares for the Conversion Price and/or
the liquidation of the Company, (b) to the Company after, or
concurrently with, the consummation of a business combination, and
(c) to the Company in limited amounts for its working capital
requirements and tax obligations. Each of Parent and Merger
Sub further acknowledge that if the transactions contemplated by
this Agreement, or, upon termination of this Agreement, another
business combination, are not consummated by November 7, 2009, the
Company will be obligated to return to its stockholders the amounts
being held in the Trust Account. Accordingly, except (subject to
the occurrence of the Effective Time) as set forth in
Section 6.16(a) and Section 8.3 , each of
Parent and Merger Sub, for itself and its subsidiaries, affiliated
entities, directors, officers, employees, stockholders,
representatives, advisors and all other associates and affiliates,
hereby waive all rights, title, interest or claim of any kind
against the Company to collect from the Trust Account any monies
that may be owed to them by the Company for any reason whatsoever,
including but not limited to a breach of this Agreement by the
Company or any negotiations, agreements or understandings with the
Company (whether in the past, present or future), and will not seek
recourse against the Trust Account at any time for any reason
whatsoever. This paragraph will survive this Agreement and
will not expire and will not be altered in any way without the
express written consent of the Company.
Section 6.16
Share
Purchases .
The parties agree and acknowledge that, following the initial
filing of the Proxy Statement/Prospectus with the SEC, the Company
may seek to purchase, or enter into binding contracts to purchase,
Shares either in the open market or in privately negotiated
transactions. Any such purchases or contracts would be
entered into and effected either (i) pursuant to a 10b(5)-1
plan, (ii) at a time when the Company, Parent, the Sponsors
and their respective Affiliates are not aware of any material
nonpublic information regarding the Company or its securities or
(iii) pursuant to agreements between the buyer and seller of
such Shares in a form that would not violate the insider trading
rules.
Section 6.17
Proposed Charter
Amendment .
Immediately prior to the Closing, the Company shall file the
Proposed Charter Amendment with the Secretary of State of Delaware
such that the Proposed Charter Amendment shall be in full force and
effect on the Closing.
Section 6.18
REIT
Election .
The Parent shall make a timely election to qualify as a real
estate investment trust within the meaning of Section 856 of
the Code (a “ REIT ”) in connection with the
filing of its 2009 federal income Tax Return, and the Surviving
Company and Parent, if requested by Parent, shall make an election
to treat the Surviving Company as a taxable REIT subsidiary within
the meaning of Section 856(l) of the Code, effective as of the
Closing Date.
Section 6.19
Ancillary
Agreements .
The Company shall enforce and perform all of its rights and
obligations under the Ancillary Agreements and shall not agree to
amend, waive or modify such rights or such agreements without the
prior written consent of Parent.
Section 6.20
Asset
Acquisition . Promptly following the
Effective Time, Parent shall begin acquiring agency residential
mortgage-backed securities and other assets meeting the
requirements set forth in the Investment Criteria.
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Section 6.21
Resignation
Letters .
Parent shall use commercially reasonable efforts to have the
present directors of the Company deliver resignation letters,
effective as of the Effective Time, no less than three (3) Business
Days prior to the Effective Time.
Section 6.22
Registration
Statement .
Promptly after the SEC has declared the S-4 Registration
Statement effective, Parent shall, at the Company's expense, file a
registration statement with the SEC registering for resale the
Warrants (and underlying Shares) held by the Sponsors and Parent
and use commercially reasonable efforts to have such registration
statement declared effective at, or soon as reasonably practicable
after, the Closing Date.
Section 6.23
Restrictions
. From the date
hereof until the earlier of the Effective Time or the termination
of this Agreement pursuant to its terms, except for the transaction
contemplated by this Agreement, Parent shall not, and shall cause
its Affiliates not to, (i) take any action to form a
mortgage-backed securities REIT or engage in any transaction
substantially similar in structure or nature thereto, whether or
not through the acquisition of a special purpose acquisition
company, an offering of securities or otherwise or (ii) enter
into any discussions, negotiations or agreement with respect to any
transaction contemplated in clause (i). Parent shall use
commercially reasonable efforts to cause its officers, directors,
employees, representatives and agents not to take any of the
actions contemplated by the immediately preceding
sentence.
Section 6.24
Cancellation of
Certain Pre-IPO Shares . On the day prior to the
record date for the Enterprise Distribution, the Company shall
cause each Share that is owned by the Sponsor Vehicle and that
was acquired by the Sponsor Vehicle prior to the IPO to be
transferred to the Company and to be cancelled and retired and to
cease to exist, and no consideration shall be delivered in exchange
therefor.
ARTICLE VII
CONDITIONS
Section 7.1
Conditions to Each
Party’s Obligation to Effect the Merger
. The respective
obligation of each party to effect the Merger shall be subject to
the satisfaction or waiver of the following conditions:
(a)
Stockholder
Approval .
The Company Stockholder Approval shall have been
obtained.
(b)
Warrantholder
Approval .
The Company Warrantholder Approval shall have been
obtained.
(c)
Proposed Charter
Amendment .
The Company shall have received an opinion of Richards,
Layton & Finger, P.A. in form and substance reasonably
satisfactory to both Parent and the Company, that the Proposed
Charter Amendment is permissible under the DGCL and the Proposed
Charter Amendment shall have been filed with the Secretary of State
of Delaware and shall be in full force and effect.
(d)
Converting
Stockholders . Public Stockholders holding
the Conversion Threshold shall not have voted against approval of
the Business Combination and elected to convert their IPO
Shares.
(e)
Registration
Statement .
The S-4 Registration Statement shall have become effective in
accordance with the provisions of the Securities Act. No stop
order suspending the effectiveness of the S-4 Registration
Statement shall have been issued by the SEC and remain in effect
and no proceeding to that effect shall have been commenced or
threatened. All necessary state securities or blue sky
authorizations shall have been received.
(f)
Legal
Action .
No statute, rule, ruling, regulation, judgment, decision,
order, injunction, writ or decree shall have been enacted, entered,
ordered, promulgated, issued or enforced by any court or other
Governmental Authority that is in effect and prohibits, enjoins or
restricts the consummation of the Transactions.
(g)
Tax Legal
Opinion .
Each of the Company and Parent shall have received an
opinion, in form and substance reasonably satisfactory to such
party, dated as of the Closing Date, and based upon customary
assumptions, qualifications and representations, warranties and
covenants contained in an officer’s certificate, to the
effect that for federal income tax purposes (A) the Merger
will be treated as a contribution governed by Section 351 of
the Code or a reorganization under Section 368(a) of the Code
and (B) the holders of Shares will recognize no gain or loss
on the exchange of those Shares for Parent Shares (except to the
extent that a holder of Shares receives cash in exchange for any
portion of its Shares), and such opinion shall not have been
withdrawn. The parties to this Agreement agree to make
representations to each other in an agreed upon form, and the
receipt of such representation letters by such counsel shall be a
condition to the issuance of its opinion.
(h)
Trust
Account .
The Trust Account shall contain no less than ONE HUNDRED
MILLION DOLLARS ($100,000,000), after taking into account all
payments described in Section 6.15(a) .
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Section 7.2
Conditions to the
Obligations of the Company . The obligations of the
Company to effect the Merger shall be subject to the satisfaction
or waiver of the following conditions:
(a)
Representations
Accurate .
Each of the representations and warranties made by Parent and
Merger Sub in this Agreement that is qualified by reference to
materiality or Material Adverse Effect shall be true and correct,
and each of the other representations and warranties made by the
Parent and Merger Sub in this Agreement shall be true and correct
except as would not reasonably be expected to have a Material
Adverse Effect, in each case as of the date of this Agreement and
at and as of the Closing Date as if made on that date (except in
any case that representations and warranties that expressly speak
as of a specified date or time need only be true and correct as of
such specified date or time).
(b)
Performance . Each of Parent and Merger
Sub shall have performed and complied, in all material respects,
with each agreement, covenant and obligation required by this
Agreement to be so performed or complied with by it at or before
the Closing Date.
(c)
Material Adverse
Effect .
Since the date of this Agreement there has not been a
Material Adverse Effect on Parent.
(d)
Officer’s
Certificate . Parent shall have delivered
to the Company a certificate, dated the Closing Date and duly
executed by the Chief Executive Officer of Parent, in form and
substance reasonably satisfactory to the Company, to the effect of
(a) - (c) of this Section 7.2 .
(e)
Ancillary
Agreements .
Each of the Ancillary Agreements shall be valid, binding and
enforceable against each party that executed such Ancillary
Agreement in accordance with its terms, and shall be in full force
and effect, except as a result of the failure of the Company or the
Sponsors to duly execute any such Ancillary Agreement.
(f)
REIT Legal
Opinion .
The Company shall have received the opinion of Akerman
Senterfitt, in form and substance reasonably satisfactory to the
Company, dated as of the Closing Date, and based upon customary
assumptions, qualifications, and representations, warranties and
covenants contained in an officer’s certificate, regarding
the qualification of Parent as a REIT under the Code.
Section 7.3
Conditions to the
Obligations of Parent and Merger Sub . The obligations of Parent
and Merger Sub to effect the Merger shall be subject to the
satisfaction or waiver of the following conditions:
(a)
Representations
Accurate .
Each of the representations and warranties made by the
Company in this Agreement that is qualified by reference to
Material Adverse Effect shall be true and correct, and each of the
other representations and warranties made by the Company in this
Agreement shall be true and correct except as would not reasonably
be expected to have a Material Adverse Effect, in each case as of
the date of this Agreement and at and as of the Closing Date as if
made on that date (except in any case that representations and
warranties that expressly speak as of a specified date or time need
only be true and correct as of such specified date or
time).
(b)
Performance . The Company shall have
performed and complied, in all material respects, with each
agreement, covenant and obligation required by this Agreement to be
performed or complied with by it at or before the Closing
Date.
(c)
Material Adverse
Effect .
Since the date of this Agreement there has not been a
Material Adverse Effect on the Company.
(d)
Officer’s
Certificate . The Company shall have
delivered to Parent a certificate, dated the Closing Date and duly
executed by the Chief Executive Officer of the Company, in form and
substance reasonably satisfactory to Parent, to the effect of
(a) - (c) of this Section 7.3
.
(e)
Ancillary
Agreements .
Each of the Ancillary Agreements shall be valid, binding and
enforceable against each party that executed such Ancillary
Agreement in accordance with its terms and shall be in full force
and effect, except as a result of the failure of Parent, the
Manager or any of their respective Affiliates to duly execute any
such Ancillary Agreement.
ARTICLE VIII
TERMINATION
Section 8.1
Termination . This Agreement may be
terminated at any time prior to the Effective Time, whether before
or after the Company Stockholder Approval:
(a)
by mutual written
consent of Parent and the Company;
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(b)
by either Parent or the
Company:
(i)
if the Company
Stockholder Approval shall not have been obtained at the Company
Stockholder Meeting or any adjournment or postponement thereof (but
not later than the Termination Date);
(ii)
if the Effective Time
shall not have occurred by November 7, 2009 (the “
Termination Date ”);
(iii)
if any Governmental
Authority shall have issued an order, decree or ruling or taken any
other action permanently enjoining, restraining or otherwise
prohibiting the Transactions and such order, decree or ruling or
other action shall have become final and nonappealable;
or
(iv)
if the other party
shall have breached or failed to perform in any material respect
any of its representations, warranties, covenants or other
agreements contained in this Agreement that (i) would give
rise to the failure of a condition set forth in Article VII
and (ii) cannot be or has not been cured within thirty (30)
calendar days after receipt of written notice thereof;
(c)
by Parent:
(i)
if the Company’s
board of directors or any committee thereof makes or publicly
proposes to make a Change in Recommendation pursuant to
Section 6.2(b)(i) ; or
(ii)
if the Company’s
board of directors or any committee thereof approves or recommends
or, after two (2) Business Days following receipt of an Acquisition
Proposal, takes no position with respect to, or publicly proposes
to approve or recommend or, after five (5) Business Days following
receipt of an Acquisition Proposal, take no position with respect
to, an Acquisition Proposal pursuant to
Section 6.2(b)(ii) .
(d)
by the Company if the
Company’s board of directors or any committee thereof causes
the Company to enter into any agreement related to any Acquisition
Proposal (other than a confidentiality agreement as contemplated by
Section 6.2(a) ) pursuant to
Section 6.2(b)(iii) , provided that (i) the
Company has complied with all provisions thereof, including the
notice provisions therein and (ii) has paid the Termination
Fee to Parent pursuant to Section 8.3 ; and
(e)
notwithstanding
anything else contained in this Agreement, the right to terminate
this Agreement under this Section 8.1(b), (c) or
(d) shall not be available to any party (i) that is in
material breach of its obligations hereunder or (ii) whose
failure to fulfill its obligations or to comply with its covenants
under this Agreement has been the cause of, or resulted in, the
failure to satisfy any condition to the obligations of Parent or
the Company hereunder.
Section 8.2
Effect of
Termination . In the event of a
termination of this Agreement by either the Company or Parent as
provided in Section 8.1 , this Agreement shall
forthwith become void except as specifically provided herein and,
except as provided in this Section 8.2 ,
Section 6.12 (Confidentiality),
Section 6.16 (Trust Account), Section 8.3
(Termination Fee) and Article IX (Miscellaneous), each of
which will survive termination and there shall be no liability or
obligation on the part of any party hereto or their respective
officers or directors; provided , however , that
nothing herein shall relieve any party for liability for any
willful breach hereof.
Section 8.3
Termination
Fee .
(a)
In the event that
Parent elects to terminate this Agreement pursuant to
Section 8.1(c) and an Alternative Transaction is
consummated within twelve (12) months following such termination,
then the Company shall pay to Parent an amount in cash equal to
FIVE MILLION DOLLARS ($5,000,000) (the “ Termination
Fee ”). The Termination Fee shall be paid by wire
transfer or other means reasonably acceptable to Parent immediately
upon the consummation of the Alternative Transaction.
(b)
In the event that the
Company elects to terminate this Agreement pursuant to
Section 8.1(d) and an Alternative Transaction is
consummated within twelve (12) months following such termination,
then the Company shall pay or cause to be paid an amount in cash
equal to the Termination Fee to Parent by wire transfer or other
means reasonably acceptable to Parent immediately upon the
consummation of the Alternative Transaction.
(c)
The Termination Fee
shall be the sole and exclusive remedy of Parent and Merger Sub
against the Company and any of its current, former or future
directors, officers, representatives or affiliates for any loss or
damage suffered in connection with this Agreement or the
Transactions. In the event that the Company fails to pay the
Termination Fee pursuant to this Section 8.3 when the
payment thereof is not the subject of a bona fide dispute, Parent
and Merger Sub
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shall be entitled to
seek and receive, in addition to the Termination Fee pursuant to
this Section 8.3 , interest thereon and Parent and
Merger Sub’s costs and expenses of collection thereof
(including reasonable attorneys’ fees and
expenses).
ARTICLE IX
MISCELLANEOUS
Section 9.1
Non-survival of
Representations and Warranties . None of the representations
and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement shall survive the Effective Time.
This Section 9.1 shall not limit any covenant or
agreement which by its terms contemplates performance after the
Effective Time.
Section 9.2
Notices
. All notices,
requests and other communications under this Agreement must be in
writing and will be deemed to have been duly given upon receipt to
the parties at the following addresses or facsimiles (or at such
other address or facsimile for a party as shall be specified by the
notice):
If to the
Company:
Enterprise Acquisition
Corp.
6800 Broken Sound
Parkway, Suite 200
Boca Raton, Florida
33487
Attention: Daniel
C. Staton
Facsimile: (561)
988-4500
With copies (which
shall not constitute notice) to:
Akerman
Senterfitt
1 SE Third
Avenue
Miami, FL
33131
Attention: Bradley D.
Houser
Martin G.
Burkett
Facsimile:
(305) 374-5095
If to Parent or Merger
Sub:
ARMOUR Residential REIT,
Inc.
3005 Hammock
Way
Vero Beach, FL
32963
Attention: Jeffrey J.
Zimmer
Scott J. Ulm
Facsimile: (561)
988-4505
(561)
988-4504
With a copy (which
shall not constitute notice) to:
Cahill Wink
LLP
5 Penn Plaza – 23
rd Floor
New York, NY
10001
Attention: David G.
Nichols, Jr.
Facsimile: (518)
584-1962
Section 9.3
Entire
Agreement .
This Agreement and the other Transaction Documents supersede
all prior and contemporaneous discussions and agreements, both
written and oral, among the parties with respect to the subject
matter of this Agreement and the other Transaction Documents and
constitute the sole and entire agreement among the parties to this
Agreement with respect to the subject matter of this Agreement and
the other Transaction Documents.
Section 9.4
Waiver
. Any term or
condition of this Agreement may be waived at any time by the party
that is entitled to the benefit thereof, but no such waiver shall
be effective unless set forth in a written instrument duly executed
by or on behalf of the party waiving such term or condition.
No waiver by any party of any term or condition of this
Agreement, in any one or more instances, shall be deemed to be or
construed as a waiver of the same or any other term or condition of
this Agreement on any future occasion. All remedies, either
under this Agreement or by Law or otherwise afforded, will be
cumulative and not alternative.
Section 9.5
Amendment
. This Agreement
may be amended, supplemented or modified only by a written
instrument duly executed by or on behalf of each party to this
Agreement at any time before or after obtaining the
Company
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Stockholder Approval,
but, after the Company Stockholder Approval, no amendment shall be
made that by Law or in accordance with the rules of NYSE Amex
requires further approval by such stockholders without obtaining
such further approval. This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the
parties hereto.
Section 9.6
No Third-Party
Beneficiary .
The terms and provisions of this Agreement are intended
solely for the benefit of each party hereto and their respective
successors or permitted assigns, and it is not the intention of the
parties to confer third-party beneficiary rights upon any other
Person except as provided in Section 6.9
(Indemnification; Directors’ and Officers’ Insurance)
and Section 9.14 (Enforcement).
Section 9.7
Assignment; Binding
Effect .
Neither this Agreement nor any right, interest or obligation
under this Agreement may be assigned by any party to this Agreement
by operation of law or otherwise without the prior written consent
of the other parties to this Agreement and any attempt to do so
will be void. Subject to the foregoing, this Agreement is
binding upon, inures to the benefit of and is enforceable by the
parties to this Agreement and their respective successors and
assigns.
Section 9.8
CONSENT TO
JURISDICTION AND SERVICE OF PROCESS . EACH PARTY HEREBY
IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF ANY FEDERAL
COURT LOCATED IN THE STATE OF DELAWARE OR ANY STATE COURT LOCATED
IN THE STATE OF DELAWARE IN RESPECT OF ANY ACTION, SUIT OR
PROCEEDING ARISING IN CONNECTION WITH THIS AGREEMENT AND THE
TRANSACTION DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY, AND AGREES THAT ANY SUCH ACTION, SUIT OR PROCEEDING SHALL
BE BROUGHT ONLY IN SUCH COURT (AND WAIVES ANY OBJECTION BASED ON
FORUM NON CONVENIENS OR ANY OTHER OBJECTION TO VENUE THEREIN);
PROVIDED , HOWEVER , THAT SUCH CONSENT TO
JURISDICTION IS SOLELY FOR THE PURPOSE REFERRED TO IN THIS
SECTION 9.8 AND SHALL NOT BE DEEMED TO BE A GENERAL
SUBMISSION TO THE JURISDICTION OF SAID COURTS OR IN THE STATE OF
DELAWARE OTHER THAN FOR SUCH PURPOSE. Any and all process
may be served in any action, suit or proceeding arising in
connection with this Agreement by complying with the provisions of
Section 9.2 . Such service of process shall have
the same effect as if the party being served were a resident in the
State of Delaware and had been lawfully served with such process in
such jurisdiction. The parties hereby waive all claims of
error by reason of such service. Nothing herein shall affect
the right of any party to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise
proceed against the other in any other jurisdiction to enforce
judgments or rulings of the aforementioned courts.
Section 9.9
Specific
Performance .
The parties hereto agree that if any of the provisions of
this Agreement were not performed in accordance with their specific
terms or were otherwise breached, irreparable damage would occur,
no adequate remedy at law would exist and damages would be
difficult to determine, and that the parties shall be entitled to
specific performance of the terms hereof, in addition to any other
remedy at law or equity.
Section 9.10
Invalid
Provisions .
If any provision of this Agreement is held to be illegal,
invalid or unenforceable under any present or future law, and if
the rights or obligations of any party hereto under this Agreement
will not be materially and adversely affected thereby,
(a) such provision will be fully severable, (b) this
Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part
hereof, (c) the remaining provisions of this Agreement will
remain in full force and effect and will not be affected by the
illegal, invalid or unenforceable provision or by its severance
herefrom and (d) in lieu of such illegal, invalid or
unenforceable provision, there will be added automatically as a
part of this Agreement a legal, valid and enforceable provision as
similar in terms to such illegal, invalid or unenforceable
provision as may be possible.
Section 9.11
GOVERNING
LAW .
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD
FOR THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
Section 9.12
Counterparts . This Agreement may be
executed in any number of counterparts, all of which will
constitute one and the same instrument.
Section 9.13
Expenses
. The Surviving
Company shall pay all Expenses of Parent, Merger Sub and the
shareholders of Parent in connection with the transactions
contemplated in Article III . Whether or not the
Merger is consummated, all costs and Expenses incurred in
connection with this Agreement and the other Transaction Documents
shall be paid by the party incurring such expense, except as
contemplated by this Agreement, including Sections 6.16
(Trust Account) and 6.25 (Registration Statement) and any
other Transaction Documents; provided , however ,
that the Company shall be responsible for all costs and Expenses of
the financial printer and any SEC filing fees.
[ Signature
Page Follows ]
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IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first written
above.
ARMOUR RESIDENTIAL
REIT, INC.
By:
/s/ Jeffrey J.
Zimmer
Name: Jeffrey J.
Zimmer
Title: Chief Executive
Officer
ARMOUR MERGER SUB
CORP.
By:
/s/ Jeffrey J.
Zimmer
Name: Jeffrey J.
Zimmer
Title: Chief Executive
Officer
ENTERPRISE
ACQUISITION CORP.
By:
/s/ Daniel C.
Staton
Name: Daniel C.
Staton
Title: President &
CEO
[ Signature Page to
Agreement and Plan of Merger ]
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SCHEDULE
4.6
ABSENCE OF
UNDISCLOSED LIABILITIES
None.
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SCHEDULE
4.7
ABSENCE OF CERTAIN
CHANGES OR EVENTS
On August 23,
2008 the Company entered into the Agreement and Plan of Merger by
and among Company, Staton Bell Blank Check LLC, EAC I LLC, EAC II
Corp., WF Capital Holdings, Inc., the securityholders of WF Capital
Holdings, Inc., and Perseus, L.L.C., as the representative of such
securityholders (the " Workflow Merger Agreement "), which
was terminated on March 2, 2009 due to the fact that the merger had
not occurred on or before February 28, 2009, the termination date
in the Workflow Merger Agreement.
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SCHEDULE
5.7
BROKERS
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EXHIBIT
A
FORM OF SECOND
AMENDED AND RESTATED
CERTIFICATE OF
INCORPORATION
OF
ENTERPRISE
ACQUISITION CORP.
Pursuant to Section
245 of the
Delaware General
Corporation Law
ENTERPRISE ACQUISITION
CORP., a corporation existing under the laws of the State of
Delaware (the “ Corporation ”), by its Chief
Executive Officer, hereby certifies as follows:
1.
The name of the
Corporation is “Enterprise Acquisition
Corp.”
2.
The Corporation’s
Certificate of Incorporation was filed in the office of the
Secretary of State of the State of Delaware on July 9,
2007.
3.
An Amended and Restated
Certificate of Incorporation was filed in the office of the
Secretary of State of Delaware on November 13, 2007.
4.
This Second Amended and
Restated Certificate of Incorporation restates, integrates and
amends the Amended and Restated Certificate of Incorporation of the
Corporation.
5.
This Second Amended and
Restated Certificate of Incorporation was duly adopted by joint
written consent of the directors and stockholders of the
Corporation in accordance with the applicable provisions of
Sections 242 and 245 of the General Corporation Law of the State of
Delaware (“ DGCL ”).
6.
The text of the Amended
and Restated Certificate of Incorporation of the Corporation is
hereby amended and restated to read in full as follows:
FIRST:
The name of the
corporation is Enterprise Acquisition Corp. (hereinafter sometimes
referred to as the “ Corporation ”).
SECOND:
The registered office
of the Corporation is to be located at the Corporation Trust
Company, 1209 Orange Street, in the City of Wilmington, County of
New Castle, zip code 19801. The name of its registered agent at
that address is the Corporation Trust Company.
THIRD:
The purpose of the
Corporation shall be to engage in any lawful act or activity for
which corporations may be organized under the DGCL.
FOURTH:
The total number of
shares of all classes of capital stock which the Corporation shall
have authority to issue is 101,000,000 of which 100,000,000 shares
shall be Common Stock of the par value of $.0001 per share and
1,000,000 shares shall be Preferred Stock of the par value of
$.0001 per share.
A.
Preferred
Stock . The
Board of Directors is expressly granted authority to issue shares
of the Preferred Stock, in one or more series, and to fix for each
such series such voting powers, full or limited, and such
designations, preferences and relative, participating, optional or
other special rights and such qualifications, limitations or
restrictions thereof as shall be stated and expressed in the
resolution or resolutions adopted by the Board of Directors
providing for the issue of such series (a “ Preferred
Stock Designation ”) and as may be permitted by the DGCL.
The number of authorized shares of Preferred Stock may be increased
or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority
of the voting power of all of the then outstanding shares of the
capital stock of the Corporation entitled to vote generally in the
election of directors, voting together as a single class, without a
separate vote of the holders of the Preferred Stock, or any series
thereof, unless a vote of any such holders is required pursuant to
any Preferred Stock Designation.
B.
Common
Stock .
Except as otherwise required by law or as otherwise provided in any
Preferred Stock Designation, the holders of the Common Stock shall
exclusively possess all voting power and each share of Common Stock
shall have one vote.
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FITFTH:
The name and mailing
address of the sole incorporator of the Corporation are as
follows:
|
|
|
|
Name
|
|
Address
|
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Mark Y. Liu
|
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Akerman Senterfitt
One SE Third Avenue
Suite 2800
Miami, Florida 33131
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SIXTH:
The Corporation’s
existence shall terminate on November 7, 2009 (the “
Termination Date ”). This provision may only be
amended in connection with, and become effective upon, the
consummation of a Business Combination (defined below). A proposal
to so amend this section shall be submitted to stockholders in
connection with any proposed Business Combination pursuant to
Article Seventh (A) below.
SEVENTH:
The following
provisions (A) through (H) shall apply during the period commencing
upon the filing of this Certificate of Incorporation and
terminating upon the consummation of any “Business
Combination." A “ Business Combination ” shall
mean the acquisition by the Corporation or its stockholders,
whether by merger, capital stock exchange, asset, stock purchase,
reorganization or other similar business combination, of one or
more entities or assets (“ Target Business” or
“ Target Businesses” ) and resulting in
ownership by the Corporation or its stockholders of more than 50%
of the voting securities of the Target Business or Businesses. Any
acquisition of multiple Target Businesses shall occur
simultaneously.
“ IPO
Shares ” shall mean the shares of Common Stock issued in
the IPO.
The “ Trust
Fund ” shall mean the trust account established by the
Corporation in connection with the consummation of its IPO and into
which the Corporation will deposit a designated portion of the net
proceeds from the IPO, including any amount that is or will be due
and payable as deferred underwriting discounts and commissions (the
“ Deferred Underwriting Compensation ”) pursuant
to the terms and conditions of the underwriting agreement (the
“ Underwriting Agreement ”) to be entered into
with the underwriters of the IPO.
A. Prior
to the consummation of any Business Combination, the Corporation
shall submit such Business Combination to its stockholders for
approval regardless of whether the Business Combination is of a
type which normally would require such stockholder approval under
the DGCL. In the event that a majority of the IPO Shares present
and entitled to vote at the meeting to approve the Business
Combination are voted for the approval of such Business
Combination, the Corporation shall be authorized to consummate the
Business Combination; provided that the Corporation shall
not consummate any Business Combination if the holders of 50% or
more of the IPO Shares vote against the Business Combination and
exercise their conversion rights described in paragraph C
below.
B. Upon
consummation of the IPO, the Corporation delivered, or caused to be
delivered, for deposit into the Trust Fund $247,575,000 comprising
(i) $240,075,000 of the net proceeds of the IPO, including
$8,375,000 of deferred underwriting discounts and commissions and
(ii) $7,500,000 of the proceeds from the Corporation's sale of
7,500,000 warrants to its founding stockholder, Staton Bell Blank
Check LLC.
C.
