PRESS RELEASE
Energy
Infrastructure Acquisition Corp.
1105
North Market Street
Suite
1300
Wilmington,
Delaware 19801
FOR IMMEDIATE RELEASE
Contact:
Investor Relations / Financial Media:
Nicolas
Bornozis
President
Capital
Link, Inc.
230
Park Avenue, Suite 1536
New
York, NY 10169
Tel:
+1 212 661 7566
Email:
nbornozis@capitallink.com
www.capitallink.com
ENERGY INFRASTRUCTURE ACQUISITION CORP.
ENTERS INTO DEFINITIVE AGREEMENT FOR
ACQUISITION OF NINE VLCCs AND UP TO $50,000,000
INVESTMENT
New York, New York, December 6, 2007 —
Energy Infrastructure Acquisition Corp. (AMEX:EII) (AMEX:EIIW)
(“
Energy Infrastructure ”
or the “
Company ”)
today announced that it has entered into a definitive agreement
pursuant to which it has agreed to purchase, through a
newly-formed, wholly-owned subsidiary, Energy Infrastructure Merger
Corporation, a Marshall Islands corporation (“EIMC”),
nine very large crude carriers (“VLCCs”) from Vanship
Holdings Limited, a Liberian corporation
(“Vanship”).
The
aggregate consideration is $778,000,000, consisting of
$643,000,000 payable in cash from Energy
Infrastructure’s trust fund and borrowings under a
credit facility to be negotiated and $135,000,000 payable in
the form of 13,500,000 shares of common stock of EIMC (the
“Acquisition”). Additionally, Vanship will be
eligible to earn an additional 3,000,000 shares of common
stock of EIMC in each of the first and second 12-month periods
following the merger (up to a total of 6,000,000 shares in the
aggregate) based on the achievement of certain EBITDA hurdles
associated with the purchased vessels (“Earn Out
Tranches”).
Concurrently
with the Acquisition, it is intended that Energy
Infrastructure will consummate a merger with EIMC in which
EIMC will be the surviving entity (the “Redomiciliation
Merger”, and together with the Acquisition, the
“Business Combination”).
Concurrently
with and contingent on the closing of the Business
Combination:
| · |
Vanship
has agreed to purchase up to 5,000,000 units of EIMC to the extent
necessary for EIMC to secure financing for the Acquisition at a
purchase price of $10.00 per unit. Each unit will consist of 1
share of common stock and 1 common stock purchase warrant. The
units will be identical to those that were issued in Energy
Infrastructure’s July 2006 IPO except that they will be
subject to a lock-up period of six months
post-closing;
|
| · |
Mr.
George Sagredos, Energy Infrastructure's President and COO and a
Director, will convert convertible debt in the aggregate principal
amount of $2,685,000 into 268,500 units, at a conversion price of
$10.00 per unit. Each unit will consist of 1 share of common stock
and 1 common stock purchase warrant. The units will be identical to
those that were issued in Energy Infrastructure’s July 2006
IPO except that they will be subject to a lock-up period of six
months post-closing;
|
| · |
Mr.
George Sagredos will transfer to Vanship, at no additional cost to
Vanship, 425,000 warrants purchased by a company controlled by him
in a private placement of units in Energy Infrastructure made prior
to Energy Infrastructure’s July 2006 IPO;
|
| · |
As
a condition to the closing of the Business Combination, Mr. George
Sagredos and Mr. Andreas Theotokis, Energy Infrastructure’s
Chairman of the Board of Directors shall have agreed to the
termination of stock options to purchase an aggregate of 3,585,000
shares of common stock (exercisable at $0.01 per share) that were
issued to them prior to Energy Infrastructure’s July 2006
IPO;
|
| · |
Mr.
George Sagredos
(and any permitted assignee and/or transferee as permitted by the
Share Purchase Agreement) will
be issued 1,000,000 units of EIMC, consisting of 1 share of common
stock and 1 common stock purchase warrant. These units will be
identical to the units issued in Energy Infrastructure’s July
2006 IPO except that they will be subject to a lock-up period of
six months post-closing.
|
On
a pro forma basis, as a result of the Business Combination,
assuming the full $50,000,000 equity investment is made by
Vanship, Mr. Sagredos' conversion of the convertible debt, the
issuance of 1,000,000 units to Mr. Sagredos, and without
giving effect to the additional shares earnable in the Earn
Out Tranches:
| · |
there
will be 46,990,247 total shares outstanding on an undiluted
basis;
|
| · |
there
will be 53,247,054 total shares outstanding on a fully diluted
treasury method basis, and based on cash in trust
of approximately $10.30 per share as of September 30,
2007, which is the date of Energy Infrastructure’s most
recent quarterly filing; and
|
| · |
on
an undiluted basis, Vanship is expected to own approximately
39.4% and the Company’s management and directors are
expected to own approximately 15.7% of EIMC’s
outstanding shares of common stock, and on a fully diluted
treasury method basis, Vanship is expected to own
approximately 37.0% and the Company’s management and
directors are expected to own approximately 14.5% of
EIMC’s outstanding shares of common stock.
|
If
the Business Combination is consummated, EIMC will be the
first shipping company headquartered in Asia to be publicly
traded in the United States.
Upon
delivery of the vessels from Vanship, EIMC’s fleet will
be comprised of 5 double hull VLCCs and 4 single hull VLCCs.
These VLCCs transport crude oil principally from the Middle
East to Asia. The vessels have a combined cargo-carrying
capacity of 2,519,213 deadweight tons (“dwt”) and
an average age of approximately 12.4 years. The vessels are
currently 100% chartered out with an average remaining charter
life of approximately 6.3 years. Three of the nine vessels
have profit sharing arrangements.
The
table below provides summary information about the
fleet:
|
|
Daily Time Charter
Hire Rate*
|
|
Charter Expiry
|
|
|
DH1
|
39,500
|
Time
Charter
|
May
2014
|
(1)
|
|
DH2
|
39,000
|
Time
Charter
|
February
2017
|
(2)
|
|
DH3
|
43,800
|
Time
Charter
|
December
2016
|
|
|
DH4
|
38,500
|
Time
Charter
|
January
2017
|
(3)
|
|
DH5
|
28,900
|
Time
Charter*
|
March
2009
|
(4)
|
|
DH5
|
30,000
|
Time
Charter*
|
March
2019
|
(4)(5)
|
|
SH1
|
29,800
|
Time
Charter
|
October
2010
|
|
|
SH2
|
32,000
|
Consecutive
Voyage Charter
|
September
2009
|
(6)
|
|
SH3
|
32,800
|
Time
Charter
|
June
|
|
