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Cayman Islands
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6770
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87-1634103
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(State or other jurisdiction of
incorporation or organization) |
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(Primary Standard Industrial
Classification Code Number) |
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(I.R.S. Employer
Identification Number) |
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Douglas S. Ellenoff
Stuart Neuhauser Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas, 11th Floor New York, New York 10105 Tel: (212) 370-1300 |
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Bradley Kruger
Ogier (Cayman) LLP 89 Nexus Way, Camana Bay, Grand Cayman Cayman Islands KY1-9009 Tel: (345) 949-9876 |
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Albert Lung, Esq.
Morgan, Lewis & Bockius LLP 1400 Page Mill Road Palo Alto, California 94304 Tel: (650) 843-4000 |
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Large accelerated filer
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| | ☐ | | | Accelerated filer | | | ☐ | |
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Non-accelerated filer
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| | ☒ | | |
Smaller reporting company
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| | ☒ | |
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Emerging growth company
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| | ☒ | |
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Per Unit
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Total
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Public offering price(1)
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| | | $ | 10.00 | | | | | $ | 150,000,000 | | |
Underwriting discounts and commissions
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| | | $ | 0.60 | | | | | $ | 9,000,000 | | |
Proceeds, before expenses, to us
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| | | $ | 9.40 | | | | | $ | 141,000,000 | | |
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| | | | F-1 | | |
| | |
March 31, 2024
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| | |
Actual
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As Adjusted
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(Audited)
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Balance Sheet Data: | | | | ||||||||||
Working (deficiency) capital(1)
|
| | | $ | (50,570) | | | | | $ | 1,255,865 | | |
Total assets(2)
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| | | $ | 56,435 | | | | | $ | 151,255,865 | | |
Total liabilities(3)
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| | | $ | 50,570 | | | | | $ | 6,167,400 | | |
Value of ordinary share subject to possible redemption(4)
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| | | $ | — | | | | | $ | 150,000,000 | | |
Shareholders’ equity (deficit)(5)
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| | | $ | 5,865 | | | | | $ | (4,911,535) | | |
|
Public shares
|
| | | | 15,000,000 | | |
|
Founder shares
|
| | | | 5,270,270 | | |
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Total shares
|
| | | | 20,270,270 | | |
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Total funds in trust available for initial business combination
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| | | $ | 144,000,000 | | |
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Public shareholders’ investment per Class A ordinary share(1)
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| | | $ | 10.00 | | |
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Sponsor’s investment per Class B ordinary share(2)
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| | | $ | 0.005 | | |
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Initial implied value per public share
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| | | $ | 10.00 | | |
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Implied value per share upon consummation of initial business combination(3)
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| | | $ | 7.10 | | |
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Without
Over-allotment Option |
| |
Over-allotment
Option Exercised |
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Gross proceeds | | | | | | | | | | | | | |
Gross proceeds from units offered to public(1)
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| | | $ | 150,000,000 | | | | | $ | 172,500,000 | | |
Gross proceeds from private placement warrants offered in the private placement
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| | | $ | 5,000,000 | | | | | $ | 5,000,000 | | |
Total gross proceeds
|
| | | $ | 155,000,000 | | | | | $ | 177,500,000 | | |
Offering expenses(2) | | | | | | | | | | | | | |
Underwriting commissions (2.0% of gross proceeds from units offered to public)(3)
|
| | | $ | 3,000,000 | | | | | $ | 3,000,000 | | |
Legal fees and expenses
|
| | | | 325,000 | | | | | | 325,000 | | |
Printing and engraving expenses
|
| | | | 35,000 | | | | | | 35,000 | | |
Trustee fees and expenses
|
| | | | 35,000 | | | | | | 35,000 | | |
Accounting fees and expenses
|
| | | | 45,000 | | | | | | 45,000 | | |
SEC/FINRA expenses
|
| | | | 71,515 | | | | | | 71,515 | | |
Travel and road show expenses
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| | | | 5,000 | | | | | | 5,000 | | |
Nasdaq listing fees
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| | | | 80,000 | | | | | | 80,000 | | |
Miscellaneous
|
| | | | 153,485 | | | | | | 153,485 | | |
Total offering expenses (other than underwriting commissions)
|
| | | $ | 750,000 | | | | | $ | 750,000 | | |
Proceeds after offering expenses
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| | | $ | 151,250,000 | | | | | $ | 173,750,000 | | |
Held in trust account(3)
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| | | $ | 150,000,000 | | | | | $ | 172,500,000 | | |
% of public offering size
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| | | | 100% | | | | | | 100% | | |
Not held in trust account
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| | | $ | 1,250,000 | | | | | $ | 1,250,000 | | |
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Amount
|
| |
% of Total
|
| ||||||
Accounting, due diligence, travel, and other expenses in connection with any business combination
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| | | $ | 350,000 | | | | | | 28.0% | | |
Legal and accounting fees related to regulatory reporting obligations
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| | | | 175,000 | | | | | | 14.0% | | |
Nasdaq and other regulatory fees
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| | | | 80,000 | | | | | | 6.4% | | |
Reimbursement for office space and administrative support(5)
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| | | | 120,000 | | | | | | 9.6% | | |
Directors’ and officers’ liability insurance
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| | | | 450,000 | | | | | | 36.0% | | |
Working capital to cover miscellaneous
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| | | | 75,000 | | | | | | 6.0% | | |
Total
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| | | $ | 1,250,000 | | | | | | 100% | | |
| | |
Without
Over- allotment |
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With
Over- allotment |
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Public offering price
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| | | $ | 10.00 | | | | | $ | 10.00 | | |
Net tangible book deficit before this offering
|
| | | $ | (0.01) | | | | | $ | (0.01) | | |
Increase attributable to public shareholders
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| | | $ | (0.92) | | | | | $ | (1.00) | | |
Pro forma net tangible book value after this offering and the sale of the private placement warrants
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| | | $ | (0.93) | | | | | $ | (1.01) | | |
Dilution to public shareholders
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| | | $ | 10.93 | | | | | $ | 11.01 | | |
Percentage of dilution to public shareholders
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| | | | 109.30% | | | | | | 110.10% | | |
| | |
Purchased
|
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Total
Consideration |
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Average
Price Per Share |
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Number
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Percentage
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Amount
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Percentage
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Initial Shareholders
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| | | | 5,270,270 | | | | | | 26.0% | | | | | $ | 25,000 | | | | | | 0.01% | | | | | $ | 0.005 | | |
Public Shareholders
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| | | | 15,000,000 | | | | | | 74.0% | | | | | | 150,000,000 | | | | | | 99.99% | | | | | $ | 10.00 | | |
| | | | | 20,270,270 | | | | | | 100.0% | | | | | | 150,025,000 | | | | | | 100.0% | | | | | | | | |
| | |
Without
Over-allotment |
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With
Over-allotment |
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Numerator: | | | | | | | | | | | | | |
Net tangible book deficit before this offering
|
| | | $ | (50,570) | | | | | $ | (50,570) | | |
Net proceeds from this offering and sale of the private placement
warrants(1) |
| | | | 151,250,000 | | | | | | 173,750,000 | | |
Plus: Offering costs paid in advance, excluded from tangible book value before this offering
|
| | | | 56,435 | | | | | | 56,435 | | |
Less: Deferred underwriting commissions
|
| | | | (6,000,000) | | | | | | (7,350,000) | | |
Less: Over-allotment liability
|
| | | | (167,400) | | | | | | — | | |
Less: Proceeds held in trust subject to redemption
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| | | | (150,000,000) | | | | | | (172,500,000) | | |
| | | | $ | (4,911,535) | | | | | $ | (6,094,135) | | |
Denominator: | | | | | | | | | | | | | |
Class B ordinary shares outstanding prior to this offering
|
| | | | 6,060,811 | | | | | | 6,060,811 | | |
Class B ordinary shares forfeited if over-allotment is not exercised
|
| | | | (790,541) | | | | | | — | | |
Class A ordinary shares included in the units offered
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| | | | 15,000,000 | | | | | | 17,250,000 | | |
Less: Ordinary shares subject to redemption
|
| | | | (15,000,000) | | | | | | (17,250,000) | | |
| | | | | 5,270,270 | | | | | | 6,060,811 | | |
| | |
March 31, 2024
|
| |||||||||
| | |
Actual
|
| |
As Adjusted
|
| ||||||
Notes payable to related party
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| | | $ | 37,500 | | | | | $ | — | | |
Deferred underwriting commissions
|
| | | | — | | | | | | 6,000,000 | | |
Over-allotment liability
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| | | | | | | | | | 167,400 | | |
Class A ordinary shares, $0.0001 par value, subject to redemption, 0 and 15,000,000 shares which are subject to possible redemption, actual and as adjusted, respectively
|
| | | | — | | | | | | 150,000,000 | | |
Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding, actual and as adjusted, respectively
|
| | | | — | | | | | | — | | |
Class A ordinary shares, 500,000,000 shares authorized; 0 and 0 shares issued and outstanding, actual and as adjusted, respectively
|
| | | | — | | | | | | — | | |
Class B ordinary shares, $0.0001 par value, 50,000,000 shares authorized, 6,060,811 and 5,270,270 shares issued and outstanding, actual and as adjusted, respectively
|
| | | | 606 | | | | | | 527 | | |
Additional paid-in capital
|
| | | | 24,394 | | | | | | — | | |
Accumulated deficit
|
| | | | (19,135) | | | | | | (4,912,062) | | |
Total shareholders’ equity (deficit)
|
| | | | 5,865 | | | | | | (4,911,535) | | |
Total capitalization
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| | | $ | 43,365 | | | | | $ | 151,255,865 | | |
| | | |
Redemptions in Connection
with our Initial Business Combination |
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Other Permitted
Purchases of Public Shares by our Affiliates |
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Redemptions if we fail to
Complete an Initial Business Combination |
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Calculation of redemption price
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| | Redemptions at the time of our initial business combination may be made pursuant to a tender offer or in connection with a shareholder vote. The redemption price will be the same whether we conduct redemptions pursuant to a tender offer or in connection with a shareholder vote. In either case, our public shareholders may redeem their public shares for cash equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination (which is initially anticipated to be $10.00 per share), including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding public shares, subject to the limitation that no redemptions will take place if all of the redemptions would cause to be unable to satisfy any limitations (including but not limited to cash requirements) agreed to in connection with the negotiation of terms of a proposed business combination. | | | If we seek shareholder approval of our initial business combination, our sponsor, initial shareholders, directors, officers, advisors or their affiliates may purchase shares or warrants in privately negotiated transactions or in the open market either prior to or following completion of our initial business combination. If our sponsor, initial shareholders, directors, officers, advisors or their affiliates were to purchase shares of warrants from public shareholders, they would do so at a price no higher than the price offered through our redemption process. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers | | | If we are unable to complete our initial business combination within the completion window, we will redeem all public shares at a per-share price, payable in cash, equal to the aggregate amount, then on deposit in the trust account (which is initially anticipated to be $10.00 per share), including interest earned on the funds held in the trust account and not previously released to us (net of which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding public shares. | |
| | | | | | | will comply with such rules. | | | | |
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Impact to remaining shareholders
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| | The redemptions in connection with our initial business combination will reduce the book value per share for our remaining shareholders, who will bear the burden of the deferred underwriting commissions and interest withdrawn in order to pay our taxes (to the extent not paid from amounts accrued as interest on the funds held in the trust account). | | | If the permitted purchases described above are made, there would be no impact to our remaining shareholders because the purchase price would not be paid by us. | | | The redemption of our public shares if we fail to complete our initial business combination will reduce the book value per share for the shares held by our initial shareholders, who will be our only remaining shareholders after such redemptions. | |
| | | |
Terms of Our Offering
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Terms Under a Rule 419 Offering
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Escrow of offering proceeds
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| | $150,000,000 of the net proceeds of this offering and the sale of the private placement warrants will be deposited into a trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. | | | Approximately $129,600,000 of the offering proceeds, representing the gross proceeds of this offering, would be required to be deposited into either an escrow account with an insured depositary institution or in a separate bank account established by a broker-dealer in which the broker-dealer acts as trustee for persons having the beneficial interests in the account. | |
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Investment of net proceeds
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| | $150,000,000 of the net proceeds of this offering and the sale of the private placement warrants held in trust will initially be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations; the holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the intended business combination. To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act, which risk increases the longer that we hold investments in the trust account, we may, at any time (based on our management team’s ongoing assessment of all factors related to our potential status under the Investment Company Act), instruct the trustee to liquidate the investments held in the trust account and instead to hold the funds in the trust account in cash or in an interest bearing demand deposit account at a bank. | | | Proceeds could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act or in securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States. | |
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Receipt of interest on escrowed funds
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| | Interest on proceeds from the trust account to be paid to shareholders is reduced by (i) taxes payable and (ii) in the event of our liquidation for failure to complete our initial business combination within the allotted time, up to $100,000 of net interest that may be released to us should we have no or insufficient working | | | Interest on funds in escrow account would be held for the sole benefit of investors, unless and only after the funds held in escrow were released to us in connection with our completion of a business combination. | |
| | | |
Terms of Our Offering
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Terms Under a Rule 419 Offering
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| | | | capital to fund the costs and expenses of our dissolution and liquidation. | | | | |
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Limitation on fair value or net assets of target business
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| | Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of our assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. | | | The fair value or net assets of a target business must represent at least 80% of the maximum offering proceeds. | |
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Trading of securities issued
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| | The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless CCM and Seaport, as the representatives to the underwriters, inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated information to reflect the exercise of the over-allotment option. | | | No trading of the units or the underlying Class A ordinary shares and warrants would be permitted until the completion of a business combination. During this period, the securities would be held in the escrow or trust account. | |
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Exercise of the warrants
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| | The warrants cannot be exercised until 30 days after the completion of our initial business combination. | | | The warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection with the exercise would be deposited in the escrow or trust account. | |
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Election to remain an investor
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| | We will provide our public shareholders with the opportunity to redeem their public shares, regardless of whether they abstain, vote for, or against, our initial business combination, for cash at a per share price equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (net of | | | A prospectus containing information pertaining to the business combination required by the SEC would be sent to each investor. Each investor would be given the opportunity to notify the company in writing, within a period of no less than 20 business days and no more than 45 business days from the effective date of a post-effective amendment to the company’s registration statement, to decide if he, she or it elects to remain a | |
| | | |
Terms of Our Offering
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Terms Under a Rule 419 Offering
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| | | | taxes payable), divided by the number of then outstanding public shares, upon the completion of our initial business combination, subject to the limitations and on the conditions described herein. We may not be required by law to hold a shareholder vote. If we are not required by law and do not otherwise decide to hold a shareholder vote, we will, pursuant to our amended and restated memorandum and articles of association, conduct the redemptions pursuant to the tender offer rules of the SEC and file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under the SEC’s proxy rules. If, however, we hold a shareholder vote, we will, like many blank check companies, offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. However, if our initial business combination is structured as a statutory merger or consolidation with another company under Cayman Islands law, the approval of our initial business combination will require a special resolution, which requires the affirmative vote of at least two-thirds of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. Additionally, each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction, or whether they do not vote or abstain from voting on the proposed | | | shareholder of the company or require the return of his, her or its investment. If the company has not received the notification by the end of the 45 business day, funds and interest or dividends, if any, held in the trust or escrow account are automatically returned to the shareholder. Unless a sufficient number of investors elect to remain investors, all funds on deposit in the escrow account must be returned to all of the investors and none of the securities are issued. | |
| | | |
Terms of Our Offering
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| |
Terms Under a Rule 419 Offering
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| | | | transaction, or whether they were a public shareholder on the record date for the general meeting held to approve the proposed transaction. | | | | |
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Business combination deadline
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| | If we have not completed our initial business combination within the completion window, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter (and subject to lawfully available funds therefor), redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then-outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. | | | If an acquisition has not been completed within 18 months after the effective date of the company’s registration statement, funds held in the trust or escrow account are returned to investors. | |
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Release of funds
|
| | None of the funds held in trust will be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of our public shares if we are unable to complete our initial business combination within the completion window, subject to applicable law, or (iii) the redemption of our public shares properly submitted in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within the completion | | | The proceeds held in the escrow account are not released until the earlier of the completion of a business combination or the failure to effect a business combination within the allotted time. | |
| | | |
Terms of Our Offering
|
| |
Terms Under a Rule 419 Offering
|
|
| | | | window or (B) with respect to any other material provisions relating to shareholders’ rights or pre-initial business combination activity. | | | | |
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Delivering share certificates in connection with the exercise of redemption rights
|
| | We intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,” to, at the holder’s option, either deliver their share certificates to our transfer agent or deliver their shares to our transfer agent electronically using the Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the scheduled vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public shareholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the scheduled vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. Accordingly, a public shareholder would have up to two business days prior to the scheduled vote on the initial business combination if we distribute proxy materials, or from the time we send out our tender offer materials until the close of the tender offer period, as applicable, to submit or tender its shares if it wishes to seek to exercise its redemption rights. | | | Many blank check companies provide that a shareholder can vote against a proposed business combination and check a box on the proxy card indicating that such shareholder is seeking to exercise its redemption rights. After the business combination is approved, the company would contact such shareholder to arrange for delivery of its share certificates to verify ownership. | |
|
Limitation on redemption rights of shareholders holding more than 15% of the shares sold
|
| | If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a | | | Many blank check companies provide no restrictions on the ability of shareholders to redeem shares based on the number of shares held by such shareholders in connection with an initial business combination. | |
| | | |
Terms of Our Offering
|
| |
Terms Under a Rule 419 Offering
|
|
|
in this offering if we hold a shareholder vote
|
| | public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to Excess Shares without our prior consent. However, we would not restrict our shareholders’ ability to vote all of their shares (including Excess Shares) for or against our initial business combination. | | | | |
Name
|
| |
Age
|
| |
Position
|
|
Gautam Ivatury | | |
47
|
| | Chief Executive Officer and Chairman | |
Edward Lifshitz | | |
65
|
| | Chief Financial Officer | |
Eric Lifshitz | | |
30
|
| | Chief Operating Officer and Director | |
Dan Rosen* | | |
38
|
| | Director Nominee | |
Ken Ruggiero* | | |
57
|
| | Director Nominee | |
Tara Kenney* | | |
63
|
| | Director Nominee | |
Individual(1)(2)
|
| |
Entity
|
| |
Entity’s Business
|
| |
Affiliation
|
|
Gautam Ivatury | | | ALMA Sustainable Finance | | | Debt Investment | | | Co-Founder and Managing Partner | |
| | | Encourage Capital | | | Private Equity | | | Senior Advisor and Investment Committee Member | |
Edward Lifshitz | | | DSA Property Group | | | Real Estate Investment and Management | | | Principal | |
Eric Lifshitz | | | Melar Capital Group LLC | | | Real Estate Advisory and Investment | | | Founder | |
Dan Rosen | | | Ezra Climate | | | Fintech | | | Chief Executive Officer | |
| | | Mosaic | | | Fintech Lending | | | Chief Executive Officer, President and Chairman | |
Ken Ruggiero | | | Goal Structured Solutions | | | Lending | | | Founder, Chief Executive Officer and Chairman | |
| | | Ascent Funding | | | Lending | | | Co-Founder and Chief Executive Officer | |
Tara Kenney | | | Fidelity Investments | | | Investment Trust | | | Independent Director | |
| | |
Number of
Class A Ordinary Shares Beneficially Owned |
| |
Approximate
Percentage of Outstanding Class A Ordinary Shares |
| |
Number of
Class B Ordinary Shares Beneficially Owned(2)(4) |
| |
Approximate
Percentage of Outstanding Class B Ordinary Shares |
| ||||||||||||||||||||||||
Name and Address of Beneficial Owner(1)
|
| |
Before
Offering |
| |
After
Offering |
| |
Before
Offering |
| |
After
Offering |
| ||||||||||||||||||||||||
Melar Acquisition Sponsor I LLC(3)(5)
|
| | | | — | | | | | | — | | | | | | — | | | | | | 6,060,811 | | | | | | 100% | | | | | | 100% | | |
Gautam Ivatury(3)
|
| | | | — | | | | | | — | | | | | | — | | | | | | 6,060,811 | | | | | | 100% | | | | | | 100% | | |
Edward Lifshitz
|
| | | | — | | | | | | — | | | | | | — | | | | | | 6,060,811 | | | | | | 100% | | | | | | 100% | | |
Eric Lifshitz(3)
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Dan Rosen
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Ken Ruggiero
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Tara Kenney
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
All officers, directors and director nominees
as a group (six persons) |
| | | | — | | | | | | — | | | | | | — | | | | | | 6,060,811 | | | | | | 100% | | | | | | 100% | | |
Underwriter
|
| |
Number of
Units |
| |||
Cohen & Company Capital Markets
|
| | | | | | |
Seaport Global Securities
|
| | | | | | |
Total
|
| | | | 15,000,000 | | |
| | |
Per Unit
|
| |
Total
|
| ||||||||||||||||||
| | |
Without
Over-allotment |
| |
With
Over-allotment |
| |
Without
Over-allotment |
| |
With
Over-allotment |
| ||||||||||||
Underwriting Discounts and Commissions paid
by us |
| | | $ | 0.60 | | | | | $ | 0.60 | | | | | $ | 9,000,000 | | | | | $ | 10,350,000 | | |
| | |
Page
|
| |||
Audited Financial Statements of Melar Acquisition Corp. I: | | | | | | | |
| | | | F-2 | | | |
| | | | F-3 | | | |
| | | | F-4 | | | |
| | | | F-5 | | | |
| | | | F-6 | | | |
| | | | F-7 | | |
| | |
March 31,
2024 |
| |||
Assets: | | | | | | | |
Deferred offering costs
|
| | | $ | 56,435 | | |
Total Assets
|
| | | $ | 56,435 | | |
Liabilities and Shareholder’s Equity: | | | | | | | |
Accrued expenses
|
| | | $ | 13,070 | | |
Promissory note – related party
|
| | | | 37,500 | | |
Total Current Liabilities
|
| | | | 50,570 | | |
Commitments and Contingencies (Note 6) | | | | | | | |
Shareholder’s Equity | | | | | | | |
Preference shares, $0.0001 par value; 5,000,000 shares authorized; none issued and
outstanding |
| | | | — | | |
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; none issued and outstanding
|
| | | | — | | |
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 6,060,811 shares issued and outstanding(1)
|
| | | | 606 | | |
Additional paid-in capital
|
| | | | 24,394 | | |
Accumulated deficit
|
| | | | (19,135) | | |
Total Shareholder’s Equity
|
| | | | 5,865 | | |
Total Liabilities and Shareholder’s Equity
|
| | | $ | 56,435 | | |
| | |
For the
period from March 11, 2024 (inception) through March 31, 2024 |
| |||
General and administrative costs
|
| | | $ | 19,135 | | |
Net loss
|
| | | $ | (19,135) | | |
Basic and diluted weighted average shares outstanding(1)
|
| | | | 5,270,270 | | |
Basic and diluted net loss per share
|
| | | $ | (0.00) | | |
| | |
Class B
Ordinary shares |
| | | | | | | | | | | | | | | | | | | |||||||||
| | |
Shares
|
| |
Amount
|
| |
Additional
Paid-In Capital |
| |
Accumulated
Deficit |
| |
Shareholder’s
Equity |
| |||||||||||||||
Balance as of March 11, 2024 (inception)
|
| | | | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | | | | $ | — | | |
Class B ordinary shares issued to Sponsor
|
| | | | 6,060,811 | | | | | | 606 | | | | | | 24,394 | | | | | | — | | | | | | 25,000 | | |
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | (19,135) | | | | | | (19,135) | | |
Balance as of March 31, 2024
|
| | | | 6,060,811 | | | | | $ | 606 | | | | | $ | 24,394 | | | | | $ | (19,135) | | | | | $ | 5,865 | | |
| | |
For the
period from March 11, 2024 (inception) through March 31, 2024 |
| |||
Cash flows from operating activities: | | | | | | | |
Net loss
|
| | | $ | (19,135) | | |
Adjustments to reconcile net loss to net cash used in operating activities: | | | | | | | |
Formation costs paid by Sponsor in exchange for issuance of Class B ordinary shares
|
| | | | 6,065 | | |
Changes in operating assets and liabilities: | | | | | | | |
Accrued expenses
|
| | | | 13,070 | | |
Net cash used in operating activities
|
| | | | — | | |
Net change in cash
|
| | | | — | | |
Cash, beginning of the period
|
| | | | — | | |
Cash, end of the period
|
| | | $ | — | | |
Supplemental disclosure of cash flow information: | | | | | | | |
Deferred offering costs paid by Sponsor in exchange for issuance of Class B ordinary
shares |
| | | $ | 18,935 | | |
Deferred offering costs paid through promissory note – related party
|
| | | $ | 37,500 | | |
|
Legal fees and expenses
|
| | | | 325,000 | | |
|
Printing and engraving expenses
|
| | | | 35,000 | | |
|
Trustee fees and expenses
|
| | | | 35,000 | | |
|
Accounting fees and expenses
|
| | | | 45,000 | | |
|
SEC/FINRA expenses
|
| | | | 71,515 | | |
|
Travel and road show expenses
|
| | | | 5,000 | | |
|
Nasdaq listing fees
|
| | | | 80,000 | | |
|
Miscellaneous
|
| | | | 153,485 | | |
| Total | | | | $ | 750,000 | | |
|
Exhibit
No. |
| |
Description
|
|
| 1.1** | | | | |
| 3.1** | | | | |
| 3.2* | | | | |
| 4.1* | | | | |
| 4.2* | | | | |
| 4.3* | | | | |
| 4.4* | | | | |
| 5.1* | | | | |
| 5.2** | | | | |
| 10.1* | | | | |
| 10.2* | | | | |
| 10.3* | | | | |
| 10.4* | | | | |
| 10.5* | | | Form of Private Placement Warrants Purchase Agreement among the Registrant, Cohen & Company Capital Markets and Seaport Global Securities LLC. | |
| 10.6* | | | | |
| 10.7** | | | | |
| 10.8** | | | |
|
Exhibit
No. |
| |
Description
|
|
| 10.9* | | | | |
| 14.1* | | | | |
|
23.1**
|
| | | |
| 23.2* | | | | |
|
23.3**
|
| | | |
| 24.1* | | | | |
| 99.1* | | | | |
| 99.2* | | | | |
| 99.3* | | | | |
| 99.4* | | | | |
| 99.5* | | | | |
| 107* | | | |
| | | | MELAR ACQUISITION CORP. I | |
| | | |
By:
/s/ Gautam Ivatury
Name: Gautam Ivatury
Title: Chief Executive Officer |
|
Name
|
| |
Position
|
|
/s/ Gautam Ivatury
Gautam Ivatury
|
| |
Chief Executive Officer and Chairman
(Principal Executive Officer) |
|
*
Edward Lifshitz
|
| |
Chief Financial Officer
(Principal Financial and Accounting Officer) |
|
*
Eric Lifshitz
|
| | Chief Operating Officer and Director | |
*/s/ Gautam Ivatury
Gautam Ivatury
Attorney-In-Fact |
| |
| | | |
By:
/s/ Gautam Ivatury
Name: Gautam Ivatury
Title: Chief Executive Officer |
|
Exhibit 1.1
UNDERWRITING AGREEMENT
between
MELAR ACQUISITION CORP. I
and
COHEN & COMPANY CAPITAL MARKETS, A DIVISION OF J.V.B. FINANCIAL GROUP, LLC
and
SEAPORT GLOBAL SECURITIES LLC
As Representatives of the Underwriters
Dated: [•], 2024
UNDERWRITING AGREEMENT
New York, New York
[•], 2024
Cohen & Company Capital Markets,
a division of J.V.B. Financial Group, LLC
3 Columbus Circle, 24th Floor
New York, NY 10019
Seaport Global Securities LLC
360 Madison Avenue
22nd Floor
New York, NY 10017
As Representatives of the Underwriters
named on Schedule A hereto
Ladies and Gentlemen:
The undersigned, Melar Acquisition Corp. I, a Cayman Islands exempted company (the “Company”), hereby confirms its agreement with Cohen & Company Capital Markets, a division of J.V.B. Financial Group, LLC (“CCM”) and Seaport Global Securities LLC (“Seaport” and collectively with CCM, “Representatives” and each, a “Representative”) and with the other underwriters named on Schedule A hereto (if any), for which the Representatives are acting as representatives (the Representatives and such other underwriters being collectively referred to herein as the “Underwriters” or, each underwriter individually, an “Underwriter,” provided that, if only the Representatives are listed on such Schedule A, any references to Underwriters shall refer exclusively to the Representatives) as follows:
1. Purchase and Sale of Securities.
1.1 Firm Securities.
1.1.1 Purchase of Firm Units. On the basis of the representations and warranties contained herein, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell to the several Underwriters, severally and not jointly, and the Underwriters agree to purchase from the Company, severally and not jointly, an aggregate of 15,000,000 units (the “Firm Units”) of the Company, as set forth opposite the respective names of the Underwriters on Schedule A hereto, at a purchase price (net of discounts and commissions and the Deferred Underwriting Commission described in Section 1.3 below) of $9.40 per Firm Unit. The Firm Units are to be offered initially to the public (the “Offering”) at the offering price of $10.00 per Firm Unit. Each Firm Unit consists of one Class A ordinary share (“Ordinary Share”), $0.0001 par value, of the Company (“Public Share”), and one-half of one redeemable warrant (the “Warrants”). The Ordinary Shares and the Warrants included in the Firm Units will trade separately on the fifty-second (52nd) day following the date hereof (or if such date is not a Business Day (as defined in Section 1.1.2), the following Business Day) unless the Representatives determine to allow earlier separate trading. Notwithstanding the immediately preceding sentence, in no event will the Ordinary Shares and the Warrants included in the Firm Units trade separately until (i) the Company has filed with the Securities and Exchange Commission (the “Commission”) a Current Report on Form 8-K that includes an audited balance sheet reflecting the Company’s receipt of the gross proceeds of the Offering and the Warrant Private Placement (as defined in Section 1.4.2) and updated financial information with respect to any proceeds the Company receives from the exercise of the Over-allotment Option (as defined in Section 1.2.1) if such option is exercised prior to the filing of the Current Report on Form 8-K, and (ii) the Company has issued a press release announcing when such separate trading will begin. Each whole Warrant entitles its holder to purchase one Ordinary Share for $11.50 per share, subject to adjustment, commencing thirty (30) days after the consummation by the Company of a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more entities (the “Business Combination”), provided that the Company has an effective registration statement under the Securities Act of 1933, as amended (the “Act”) covering the Ordinary Shares issuable upon exercise of the Warrants and a current prospectus relating to them is available (or the Company permits holders to exercise their Warrants on a cashless basis under the circumstances specified in the Warrant Agreement (as defined in Section 2.23)) and such shares are registered, qualified or exempt from registration under the securities, or Blue Sky, laws of the state of residence of the holder and expiring on the five-year anniversary of the consummation by the Company of its initial Business Combination (such consummation, the “Specified Event”), or earlier upon redemption or liquidation.
1.1.2 Payment and Delivery. Delivery and payment for the Firm Units shall be made at 10:00 a.m., New York City time, on the first (1st) Business Day (as defined below) following the commencement of trading of the Units (as defined in Section 1.2.1), or at such earlier time as shall be agreed upon by the Representatives and the Company, at the offices of Morgan, Lewis & Bockius LLP, counsel to the Underwriters (“ML&B”), or at such other place as shall be agreed upon by the Representatives and the Company. The hour and date of delivery and payment for the Firm Units are called the “Closing Date.” Payment for the Firm Units shall be made on the Closing Date by wire transfer in Federal (same day) funds, payable as follows: $[•] of the proceeds received by the Company for the Firm Units and the sale of the Placement Warrants (as defined in Section 1.4.2) shall be deposited in the trust account (the “Trust Account”) established by the Company for the benefit of the Public Shareholders (as defined below), as described in the Registration Statement (as defined in Section 2.1.1) pursuant to the terms of an Investment Management Trust Agreement (the “Trust Agreement”) between the Company and Continental Stock Transfer & Trust Company (“CST”). The funds deposited in the Trust Account shall include an aggregate of $6,000,000 ($0.40 per Firm Unit), payable to the Representatives as Deferred Underwriting Commission in accordance with Section 1.3 hereof. The remaining proceeds (less commissions and actual expense payments or other fees payable pursuant to this Agreement), if any, shall be paid to the order of the Company upon delivery to the Representatives of certificates (in form and substance satisfactory to the Representatives) representing the Firm Units (or through the facilities of The Depository Trust Company (“DTC”)) for the account of the Underwriters. The Firm Units shall be registered in such name or names and in such authorized denominations as the Representatives may request in writing at least two (2) full Business Days prior to the Closing Date. If delivery is not made through the facilities of DTC, the Company will permit the Representatives to examine and package the Firm Units for delivery, at least one (1) full Business Day prior to the Closing Date. The Company shall not be obligated to sell or deliver any of the Firm Units except upon tender of payment by the Representatives for all the Firm Units. As used herein, the term “Public Shareholders” means the holders of Ordinary Shares sold as part of the Units (as defined in Section 1.2.1) in the Offering or acquired in the aftermarket, including the Sponsor (as defined in Section 1.4.1) and any officer or director of the Company, to the extent, he, she or it acquires such Ordinary Shares in the aftermarket (and solely with respect to such Ordinary Shares). “Business Day” shall mean any day other than Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home,” “shelter-in-place,” “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in the City of New York are generally open for use by customers on such day.
1.2 Over-Allotment Option.
1.2.1 Option Units. The Representatives are hereby granted an option (the “Over-allotment Option”) to purchase up to an additional 2,250,000 units (the “Option Units”), the net proceeds of which will be deposited in the Trust Account, for the purposes of covering any over-allotments in connection with the distribution and sale of the Firm Units. Such Option Units shall be identical in all respects to the Firm Units. Such Option Units shall be purchased for each account of the several Underwriters in the same proportion as the number of Firm Units, set forth opposite such Underwriter’s name on Schedule A hereto, bears to the total number of Firm Units (subject to adjustment by the Representatives to eliminate fractions). The Firm Units and the Option Units are hereinafter collectively referred to as the “Units,” and the Units, the Ordinary Shares and the Warrants included in the Units, and the Ordinary Shares issuable upon exercise of the Warrants are hereinafter referred to collectively as the “Public Securities.” No Option Units shall be sold or delivered unless the Firm Units previously have been, or simultaneously are, sold and delivered. The right to purchase the Option Units, or any portion thereof, may be exercised from time to time and to the extent not previously exercised may be surrendered and terminated at any time upon notice by the Representatives to the Company. The purchase price to be paid for each Option Unit will be the same price per Firm Unit set forth in Section 1.1.1 hereof.
1.2.2 Exercise of Option. The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representatives as to all (at any time) or any part (from time to time) of the Option Units within forty-five (45) days after the effective date (“Effective Date”) of the Registration Statement (as defined in Section 2.1.1 hereof). The Underwriters will not be under any obligation to purchase any Option Units prior to the exercise of the Over-allotment Option. The Over-allotment Option granted hereby may be exercised by the giving of oral notice to the Company by the Representatives, which must be confirmed in accordance with Section 9.1 herein setting forth the number of Option Units to be purchased and the date and time for delivery of and payment for the Option Units (the “Option Closing Date”), which will not be later than five (5) full Business Days after the date of the notice or such other time and in such other manner as shall be agreed upon by the Company and the Representatives, at the offices of ML&B or at such other place (including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representatives. If such delivery and payment for the Option Units does not occur on the Closing Date, the Option Closing Date will be as set forth in the notice. Upon exercise of the Over-allotment Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Units specified in such notice.
1.2.3 Payment and Delivery. Payment for the Option Units shall be made on the Option Closing Date by wire transfer in Federal (same day) funds, payable as follows: $10.00 per Option Unit shall be deposited in the Trust Account pursuant to the Trust Agreement upon delivery to the Representatives of certificates (in form and substance satisfactory to the Representatives) representing the Option Units (or through the facilities of DTC) for the account of the Representatives. The amount to be deposited in the Trust Account will include $0.60 per Option Unit (up to $1,350,000), payable to the Representatives, as Deferred Underwriting Commission, in accordance with Section 1.3 hereof. The certificates representing the Option Units to be delivered will be in such denominations and registered in such names as the Representatives request in writing not less than two (2) full Business Days prior to the Closing Date or the Option Closing Date, as the case may be, and will be made available to the Representatives for inspection, checking and packaging at the aforesaid office of the Company’s transfer agent or correspondent not less than one (1) full Business Day prior to such Closing Date. The Company shall not be obligated to sell or deliver the Option Units except upon tender of payment by the Representatives for applicable Option Units.
1.3 Deferred Underwriting Commission. The Representatives agree that (i) 4.0% of the gross proceeds from the sale of the Firm Units ($6,000,000) and 6.0% of the gross proceeds from the sale of the Option Units (up to $1,350,000), if any (collectively, the “Deferred Underwriting Commission”), will be deposited and held in the Trust Account and payable directly from the Trust Account, without accrued interest, to the Representatives for their own account and the account of the Underwriters upon the occurrence of the Specified Event. The Trust Agreement shall provide that the trustee is required to obtain a written instruction signed by the Company and acknowledged by the Representatives with respect to the transfer of the funds held in the Trust Account, including the payment of the Deferred Underwriting Commission from the Trust Account, prior to commencing any liquidation of the assets of the Trust Account in connection with the consummation of any Business Combination, and such provision of the Trust Agreement shall not be permitted to be amended without the prior written consent of the Representatives. In the event that the Company is unable to consummate a Business Combination and CST, as the trustee of the Trust Account (in this context, the “Trustee”), commences liquidation of the Trust Account as provided in the Trust Agreement, each Representative, on behalf of itself and the Underwriters, agrees that (i) it shall forfeit any rights or claims to the Deferred Underwriting Commission, including any accrued interest thereon; and (ii) the Deferred Underwriting Commission, together with all other amounts on deposit in the Trust Account, shall be distributed on a pro rata basis among the Public Shareholders. The Representatives shall have the right to agree to any further modifications to the Deferred Underwriting Commission on behalf of the Underwriters and any decisions relating to such modifications shall be made exclusively by the Representatives on behalf of the Underwriters. For the avoidance of doubt, the obligations of each Underwriter under this Agreement shall be fully satisfied upon the payment of the purchase price for the Public Securities purchased by such Underwriter on the Closing Date or Option Closing Date without any further conditions. Notwithstanding anything to the contrary in this Agreement, each Underwriter may at any time prior to the Specified Event and in its sole and absolute discretion, by written notice to the Company, elect to forfeit any right or claim to its Deferred Underwriting Commission, in which case the Company agrees to instruct the Trustee not to pay such Underwriter its Deferred Underwriting Commission upon the occurrence of a Specified Event. Each Representative on behalf of itself and the Underwriters further agrees that the Deferred Underwriting Commission will be based on and paid out of funds available in the Trust Account after payments made out of the Trust Account to honor redemption rights of the Public Shareholders. For the avoidance of doubt, any such election by an Underwriter shall be without prejudice to any right or claim of any other Underwriter to its respective portion of the Deferred Underwriting Commission or to any other right such Underwriter may have under this Agreement.
1.4 Private Placements.
1.4.1 Founder Shares. On March 11, 2024, the Company issued an aggregate of 6,060,811 Class B ordinary shares (the “Founder Shares”) in a private placement exempt from registration under Section 4(a)(2) of the Act, for a total subscription price of $25,000 to Melar Acquisition Sponsor I LLC, a Delaware limited liability company (“Sponsor”). No underwriting discounts, commissions or placement fees have been or will be payable in connection with the purchase of Founder Shares. Except as described in the Registration Statement, none of the Founder Shares may be sold, assigned or transferred by the Sponsor until the earlier of (A) one (1) year following the completion of the Business Combination or earlier if, subsequent to the completion of the Business Combination, the closing price of the Company’s Ordinary Shares equals or exceeds $12.00 per share (as adjusted for share splits, share capitalizations, reorganizations, recapitalizations and the like) for any twenty (20) trading days within any thirty (30)-trading day period commencing at least one hundred and fifty (150) days after the completion of the Business Combination and (B) the date on which the Company completes a liquidation, merger, share exchange or other similar transaction that results in all of the Public Shareholders having the right to exchange its Ordinary Shares for cash, securities or other property. The holders of Founder Shares shall have no right to any liquidating distributions with respect to any portion of the Founder Shares in the event the Company fails to consummate a Business Combination. The holders of the Founder Shares shall not have redemption rights with respect to the Founder Shares. In the event that the Over-allotment Option is not exercised in full, the Sponsor will be required to forfeit such number of Founder Shares (up to 790,541 Founder Shares) such that the Founder Shares then outstanding will comprise 26.0% of the issued and outstanding Public Shares after giving effect to the Offering and exercise, if any, of the Over-allotment Option.
1.4.2 Warrant Private Placement. Simultaneously with the Closing Date, (i) the Sponsor and the Underwriters will purchase from the Company, pursuant to the Purchase Agreements (as defined in Section 2.21.3 hereof), an aggregate of 5,000,000 warrants (3,500,000 by the Sponsor and 1,500,000 warrants by the Underwriters) (collectively, the “Placement Warrants”), which warrants are substantially identical to the Warrants included in the Firm Units, subject to certain exceptions, at a purchase price of $1.00 per Placement Warrant, in a private placement intended to be exempt from registration under the Act pursuant to Section 4(a)(2) of the Act. The Underwriters agree to purchase Placement Warrants consistent with their pro rata allocation of the Offering. The private placement of the Placement Warrants to the Sponsor and the Underwriters is referred to herein as the “Warrant Private Placement.” Certain proceeds from the sale of the Placement Warrants shall be deposited into the Trust Account. None of the Placement Warrants (or underlying Ordinary Shares) may be sold, assigned or transferred by the Sponsor, the Underwriters or their permitted transferees until thirty (30) days after consummation of a Business Combination. The Underwriters acknowledge and agree that the Placement Warrants and the underlying Ordinary Shares acquired by the Underwriters pursuant to the Purchase Agreement (as defined in Section 2.21.3) will be deemed compensation by the Financial Industry Regulatory Authority (“FINRA”) and will therefore be subject to lock-up for a period of one hundred and eighty (180) days immediately following the commencement of sales of the Offering, subject to certain limited exceptions, pursuant to FINRA Rule 5110(e)(1). Accordingly, the Placement Warrants and the underlying Ordinary Shares acquired by the Underwriters pursuant to the Underwriters Purchase Agreement (as defined in Section 2.21.3) may not be sold, transferred, assigned, pledged or hypothecated nor may they be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the securities by any person for one hundred and eighty (180) days immediately following the commencement of sales of the Offering, except to any FINRA member participating in the Offering and the officers, partners, registered persons or affiliates thereof, if all securities so transferred remain subject to the lock-up restriction for the remainder of the time period.
1.4.3 The Placement Warrants and the Ordinary Shares issuable upon exercise of such warrants are hereinafter referred to collectively as the “Placement Securities.” No underwriting discounts, commissions, or placement fees have been or will be payable in connection with the Placement Warrants sold in the Warrant Private Placement. The Placement Warrants are identical to the Warrants except that (i) none of the Placement Warrants will be transferable, assignable or salable until thirty (30) days after the consummation of a Business Combination except to permitted transferees and (ii) will be entitled to registration rights. The Public Securities, the Placement Securities, and the Founder Shares are hereinafter referred to collectively as the “Securities.”
1.5 Working Capital. Upon consummation of the Offering and the Warrant Private Placement, it is intended that approximately $1,250,000 of the proceeds from the Offering and the Warrant Private Placement will be released to the Company and held outside of the Trust Account to fund the working capital requirements of the Company.
1.6 Interest Income. Prior to the Company’s consummation of a Business Combination or the Company’s liquidation, interest earned on the Trust Account may be released to the Company from the Trust Account in accordance with the terms of the Trust Agreement to pay any taxes payable by the Company and up to $100,000 for dissolution expenses, all as more fully described in the Prospectus (as defined in Section 2.1.1).
2. Representations and Warranties of the Company. The Company represents and warrants to the Underwriters as follows:
2.1 Filing of Registration Statement.
2.1.1 Pursuant to the Act. The Company has filed with the Commission a registration statement and an amendment or amendments thereto, on Form S-1 (File No. 333-279899), including any related preliminary prospectus (“Preliminary Prospectus”), including any prospectus that is included in the Registration Statement immediately prior to the effectiveness of the Registration Statement, for the registration of the offer and sale of the Public Securities under the Act, which registration statement and amendment or amendments have been prepared by the Company in conformity with the requirements of the Act, and the rules and regulations (the “Regulations”) of the Commission under the Act. The conditions for use of Form S-1 to register the Offering under the Act, as set forth in the General Instructions to such Form, have been satisfied. Except as the context may otherwise require, such registration statement, as amended, on file with the Commission at the time the registration statement becomes effective (including the prospectus, financial statements, schedules, exhibits and all other documents filed as a part thereof or incorporated therein and all information deemed to be a part thereof as of such time pursuant to Rule 430A of the Regulations), is hereinafter called the “Registration Statement,” and the form of the final prospectus dated the Effective Date included in the Registration Statement (or, if applicable, the form of final prospectus containing information permitted to be omitted at the time of effectiveness by Rule 430A of the Regulations, filed by the Company with the Commission pursuant to Rule 424 of the Regulations), is hereinafter called the “Prospectus.” For the purposes of this Agreement, “Time of Sale,” as used in the Act, means [•]:[•] p.m. New York City time, on the date of this Agreement. Prior to the Time of Sale, the Company prepared a Preliminary Prospectus, which was included in the Registration Statement filed on [•], 2024, for distribution by the Underwriters (such Preliminary Prospectus used most recently prior to the Time of Sale, the “Sale Preliminary Prospectus”). Unless otherwise specified, any reference herein to the term “Registration Statement” shall be deemed to include any Registration Statement filed pursuant to Rule 462(b) under the Act registering additional securities (a “Rule 462(b) Registration Statement”). Other than a Rule 462(b) Registration Statement and the Form 8-A registration statement referred to below in Section 2.1.2, which, if filed, becomes effective upon filing, no other document with respect to the Registration Statement has been filed with the Commission. The offer and sale of all Public Securities have been registered under the Act pursuant to the Registration Statement. The Registration Statement has been declared effective by the Commission on the date hereof. If, subsequent to the date of this Agreement, the Company or the Representatives determine that at the Time of Sale, the Sale Preliminary Prospectus includes an untrue statement of a material fact or omits a statement of material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading and the Company and the Representatives agree to provide an opportunity to purchasers of the Units to terminate their old purchase contracts and enter into new purchase contracts, then the Sale Preliminary Prospectus will be deemed to include any additional information available to purchasers at the time of entry into the first such new purchase contract.
2.1.2 Pursuant to the Exchange Act. The Company has filed with the Commission a Registration Statement on Form 8-A (File Number 001-[•]) providing for the registration under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of the Units, the Public Shares and the Warrants. The registration of the Units, Public Shares and Warrants under the Exchange Act has been declared effective by the Commission on the date hereof and the Units, the Public Shares and the Warrants have been registered pursuant to Section 12(b) of the Exchange Act.
2.1.3 No Stop Orders, Etc. Neither the Commission nor, to the Company’s knowledge, assuming reasonable inquiry, any federal, state or other regulatory authority has issued any order or threatened to issue any order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus, the Sale Preliminary Prospectus or Prospectus or any part thereof, or has instituted or, to the Company’s knowledge, assuming reasonable inquiry, threatened to institute any proceedings with respect to such an order.
2.2 Disclosures in Registration Statement.
2.2.1 10b-5 Representation. At the time of effectiveness of the Registration Statement (or at the time of any post-effective amendment to the Registration Statement) and at all times subsequent thereto up to the Closing Date and the Option Closing Date, if any, the Registration Statement, the Sale Preliminary Prospectus and the Prospectus contained and will contain all material statements that are required to be stated therein in accordance with the Act and the Regulations, and did or will, in all material respects, conform to the requirements of the Act and the Regulations. The Registration Statement, as of the Effective Date, did not, and the amendments and supplements thereto, as of their respective dates, will not 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, not misleading. The Prospectus, as of its date and the Closing Date or the Option Closing Date, as the case may be, did not and will not, and the amendments and supplements thereto, as of their respective dates, will not, include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Sale Preliminary Prospectus, as of the Time of Sale (or such subsequent Time of Sale pursuant to Section 2.1.1), did not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. When any Preliminary Prospectus or the Sale Preliminary Prospectus was first filed with the Commission (whether filed as part of the Registration Statement for the registration of the Public Securities or any amendment thereto or pursuant to Rule 424(a) of the Regulations) and when any amendment thereof or supplement thereto was first filed with the Commission, such Preliminary Prospectus or the Sale Preliminary Prospectus and any amendments thereof and supplements thereto complied or will have been corrected in the Sale Preliminary Prospectus and the Prospectus to comply in all material respects with the applicable provisions of the Act and the Regulations and did not and will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The representation and warranty made in this Section 2.2.1 does not apply to statements made or statements omitted in reliance upon and in conformity with written information furnished to the Company with respect to the Underwriters by the Underwriters expressly for use in the Registration Statement, the Sale Preliminary Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge and agree that such information provided by or on behalf of the Underwriters consists solely of the following: the names of the Underwriters, the information with respect to dealers’ concessions and reallowances contained in the section entitled “Underwriting,” the information with respect to short positions and stabilizing transactions contained in the section entitled “Underwriting” and the identity of counsel to the Underwriters contained in the section entitled “Legal Matters” (such information, collectively, the “Underwriters’ Information”).
2.2.2 Disclosure of Agreements. The agreements and documents described in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus conform to the descriptions thereof contained therein in all material respects and there are no agreements or other documents required to be described in the Registration Statement, the Sale Preliminary Prospectus or the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which its property or business is or may be bound or affected and (i) that is referred to in the Registration Statement, Sale Preliminary Prospectus or the Prospectus or attached as an exhibit thereto, or (ii) that is material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force and effect and is enforceable against the Company and, to the Company’s knowledge, assuming reasonable inquiry, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (y) as enforceability of any indemnification or contribution provision may be limited under the foreign, federal and state securities laws; and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought, and no such agreement or instrument has been assigned by the Company, and neither the Company nor, to the Company’s knowledge, assuming reasonable inquiry, any other party is in breach or default thereunder and, to the Company’s knowledge, assuming reasonable inquiry, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a breach or default thereunder. To the Company’s knowledge, assuming reasonable inquiry, the performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations.
2.2.3 Prior Securities Transactions. No securities of the Company have been sold by the Company or by or on behalf of, or for the benefit of, any person or persons controlling, controlled by, or under common control with the Company since the date of the Company’s formation, except as disclosed in the Registration Statement.
2.2.4 Regulations. The disclosures in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus concerning the effects of federal, foreign, state and local regulation on the Company’s business as currently contemplated are correct in all material respects and do not omit to state a material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.
2.3 Changes After Dates in Registration Statement.
2.3.1 No Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, except as otherwise specifically stated therein, (i) there has been no material adverse change in the condition, financial or otherwise, or business prospects of the Company, (ii) there have been no material transactions entered into by the Company, other than as contemplated pursuant to this Agreement, (iii) no member of the Company’s board of directors (the “Board of Directors”) or management has resigned from any position with the Company and (iv) no event or occurrence has taken place which materially impairs, or would likely materially impair, with the passage of time, the ability of the members of the Board of Directors or management to act in their capacities with the Company as described in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus.
2.3.2 Recent Securities Transactions. Subsequent to the respective dates as of which information is given in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, and except as may otherwise be indicated or contemplated herein or therein, the Company has not (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution on or in respect to its share capital.
2.4 Independent Registered Public Accounting Firm. To the Company’s knowledge, WithumSmith+Brown (“Withum”), whose report is filed with the Commission as part of, and is included in, the Registration Statement, the Sale Preliminary Prospectus, and the Prospectus, is an independent registered public accounting firm as required by the Act, the Regulations and the Public Company Accounting Oversight Board (the “PCAOB”), including the rules and regulations promulgated by such entity. To the Company’s knowledge, Withum is currently registered with the PCAOB. Withum has not, during the periods covered by the financial statements included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act.
2.5 Financial Statements; Statistical Data.
2.5.1 Financial Statements. The financial statements, including the notes thereto and supporting schedules (if any) included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus fairly present the financial position, the results of operations and the cash flows of the Company at the dates and for the periods to which they apply; such financial statements have been prepared in conformity with United States generally accepted accounting principles (“GAAP”), consistently applied throughout the periods involved; and the supporting schedules included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus present fairly the information required to be stated therein in conformity with the Regulations. No other financial statements or supporting schedules are required to be included or incorporated by reference in the Registration Statement, the Sale Preliminary Prospectus or the Prospectus. The Registration Statement, the Sale Preliminary Prospectus and the Prospectus disclose all material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the Company with unconsolidated entities or other persons that may have a material current or future effect on the Company’s financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenues or expenses. There are no pro forma or as adjusted financial statements that are required to be included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus in accordance with Regulation S-X or Form 10 that have not been included as required.
2.5.2 Statistical Data. The statistical, industry-related and market-related data included in the Registration Statement, the Sale Preliminary Prospectus and/or the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes are reliable and accurate, and such data materially agree with the sources from which they are derived.
2.6 Authorized Capital; Options. The Company had at the date or dates indicated in each of the Registration Statement, the Sale Preliminary Prospectus, and the Prospectus, as the case may be, duly authorized, issued and outstanding capitalization as set forth in the Registration Statement, the Sale Preliminary Prospectus, and the Prospectus. Based on the assumptions stated in the Registration Statement, the Sale Preliminary Prospectus, and the Prospectus, the Company will have on the Closing Date or on the Option Closing Date, as the case may be, the adjusted share capitalization set forth therein. Except as set forth in, or contemplated by the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, on the Effective Date and on the Closing Date or Option Closing Date, as the case may be, there will be no options, warrants, or other rights to purchase or otherwise acquire any authorized but unissued Ordinary Shares or any security convertible into Ordinary Shares, or any contracts or commitments to issue or sell Ordinary Shares or any such options, warrants, rights or convertible securities.
2.7 Valid Issuance of Securities.
2.7.1 Outstanding Securities. All issued and outstanding securities of the Company issued prior to the transactions contemplated by this Agreement have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities was issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. The authorized and outstanding securities of the Company conform in all material respects to all statements relating thereto contained in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. All offers and sales and any transfers of the outstanding securities of the Company were at all relevant times either registered under the Act and the applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers of such securities, exempt from such registration requirements.
2.7.2 Securities Sold Pursuant to this Agreement. The Public Securities have been duly authorized and reserved for issuance and when issued and paid for in accordance with this Agreement, will be validly issued, and the Ordinary Shares will be fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Public Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Public Securities has been duly and validly taken. The form of certificates for the Public Securities conform to the corporate law of the jurisdiction of the Company’s incorporation and applicable securities laws. The Public Securities conform in all material respects to the descriptions thereof contained in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, as the case may be. When paid for and issued, the Warrants will constitute valid and binding obligations of the Company to issue the number and type of securities of the Company called for thereby in accordance with the terms thereof and such Warrants are enforceable against the Company in accordance with their respective terms, except (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under foreign, federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. The Ordinary Shares issuable upon exercise of the Warrants have been reserved for issuance upon the exercise of the Warrants and upon payment of the consideration therefor, and when issued and delivered in accordance with the terms thereof and such Ordinary Shares will be duly and validly authorized, validly issued and upon payment therefor, fully paid and non-assessable, and the holders thereof are not and will not be subject to personal liability by reason of being such holders.
2.7.3 Placement Securities.
2.7.3.1 The Placement Securities have been duly authorized and reserved for issuance and when issued and paid for in accordance with the Purchase Agreements, will be validly issued; the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Placement Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Placement Securities has been duly and validly taken. The Placement Warrants constitute valid and binding obligations of the Company to issue the number and type of securities of the Company called for thereby in accordance with the terms thereof, and are, or will be, enforceable against the Company in accordance with their respective terms, except (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. The Ordinary Shares issuable upon exercise of the Placement Warrants have been reserved for issuance and, when issued in accordance with the terms of the Placement Warrants, will be duly and validly authorized, validly issued and upon payment therefor, fully paid and non-assessable, and the holders thereof are not and will not be subject to personal liability by reason of being such holders.
2.7.4 No Integration. Neither the Company nor any of its affiliates has, prior to the date hereof, made any offer or sale of any securities which are required to be or may be “integrated” pursuant to the Act or the Regulations with the Offering.
2.8 Registration Rights of Third Parties. Except as set forth in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the Company have the right to require the Company to register any such securities of the Company under the Act or to include any such securities in a registration statement to be filed by the Company.
2.9 Validity and Binding Effect of Agreements. This Agreement, the Warrant Agreement (as defined in Section 2.23), the Trust Agreement, the Services Agreement (as defined in Section 2.21.4), the Registration Rights Agreement (as defined in Section 2.21.5) and the Purchase Agreements and (collectively with this Agreement, the “Transaction Documents”) have been duly and validly authorized by the Company and, when executed and delivered, will constitute the valid and binding agreements of the Company, enforceable against the Company in accordance with their respective terms, except (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) with respect to this Agreement only, as enforceability of any indemnification or contribution provision may be limited under the foreign, federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.
2.10 No Conflicts, Etc. The execution, delivery, and performance by the Company of the Transaction Documents, the consummation by the Company of the transactions herein and therein contemplated and the compliance by the Company with the terms hereof and thereof do not and will not, with or without the giving of notice or the lapse of time or both, (i) result in a breach or violation of, or conflict with any of the terms and provisions of, or constitute a default under, or result in the creation, modification, termination or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement, obligation, condition, covenant or instrument to which the Company is a party or bound or to which its property is subject except pursuant to the Trust Agreement; (ii) result in any violation of the provisions of the Amended and Restated Memorandum and Articles of Association, as may be amended from time to time, of the Company (the “Charter Documents”); or (iii) violate any existing applicable statute, law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties, assets or business constituted as of the date hereof.
2.11 No Defaults; Violations. No default or violation exists in the due performance and observance of any term, covenant or condition of any license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument evidencing an obligation for borrowed money, or any other agreement or instrument to which the Company is a party or by which the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not in violation of any term or provision of its Charter Documents or in violation of any franchise, license, permit, applicable law, rule, regulation, judgment or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its properties or businesses.
2.12 Corporate Power; Licenses; Consents.
2.12.1 Conduct of Business. The Company has all requisite corporate power and authority, and has all necessary authorizations, approvals, orders, licenses, certificates and permits of and from all governmental regulatory officials and bodies that it needs as of the date hereof to conduct its business purpose as described in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. The disclosures in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus concerning the effects of foreign, federal, state and local regulation on the Offering and the Company’s business purpose as currently contemplated are correct in all material respects and do not omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Since its formation, the Company has conducted no business and has incurred no liabilities other than in connection with its formation or in furtherance of the Offering.
2.12.2 Transactions Contemplated Herein. The Company has all requisite corporate power and authority to enter into the Transaction Documents and to carry out the provisions and conditions hereof and thereof, and all consents, authorizations, approvals and orders required in connection herewith and therewith have been obtained. No consent, authorization, or order of, and no filing with, any court, government agency or other body, foreign or domestic, is required for the valid issuance, sale and delivery, of the Securities and the consummation of the transactions and agreements contemplated by the Transaction Documents and as contemplated by the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, except with respect to applicable foreign, federal and state securities laws, the rules of The Nasdaq Global Market (“Nasdaq”) and the rules and regulations promulgated by FINRA.
2.12.3 Jurisdiction and Designation. The Company has the power to submit, and pursuant to Section 9.7 of this Agreement has, to the extent permitted by law, legal, validly, effectively and irrevocably submitted, to the jurisdiction of any New York State or United States Federal court sitting in the City of New York, Borough of Manhattan.
2.13 D&O Questionnaires. To the Company’s knowledge, assuming reasonable inquiry, all information contained in the questionnaires (“Questionnaires”) completed by each of the Company’s officers, directors and shareholders (together with the Sponsor, the “Insiders”) and provided to the Representatives and their counsel and the biographies of the Insiders and other persons contained in the Registration Statement, Sale Preliminary Prospectus and the Prospectus (to the extent a biography is contained) is true and correct and the Company has not become aware of any information which would cause the information disclosed in the Questionnaires completed by each Insider to become inaccurate, incorrect or incomplete.
2.14 Litigation; Governmental Proceedings. There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental proceeding pending, or to the Company’s knowledge, assuming reasonable inquiry, threatened against or involving the Company or, to the Company’s knowledge, assuming reasonable inquiry, any Insider or any shareholder or member of an Insider that has not been disclosed, that is required to be disclosed, in the Registration Statement, the Sale Preliminary Prospectus, the Prospectus or the Questionnaires.
2.15 Good Standing. The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of its jurisdiction of incorporation. The Company is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to qualify would not have a material adverse effect on the condition (financial or otherwise), earnings, assets, prospects, business, operations or properties of the Company, whether or not arising from transactions in the ordinary course of business (a “Material Adverse Effect”).
2.16 No Contemplation of a Business Combination. As of the date of this Agreement, the Company has not identified any specific Business Combination target (each a “Target Business”) and it has not, directly or indirectly contacted any prospective Target Business or had any substantive discussions, formal or otherwise, directly or indirectly with respect to a Business Combination with a Target Business.
2.17 Transactions Requiring Disclosure to FINRA.
2.17.1 Finder’s Fees. There are no claims, payments, arrangements, agreements or understandings relating to the payment of a brokerage commission or finder’s, consulting or origination fee by the Company or any Insider with respect to the sale of the Securities hereunder or any other arrangements, agreements or understandings of the Company or to the Company’s knowledge, assuming reasonable inquiry, any Insider that may affect the Underwriters’ compensation, as determined by FINRA.
2.17.2 Payments Within 180 Days. The Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii) to the Company’s knowledge, any “participating member,” as defined in FINRA Rule 5110, with respect to the offering (“Participating Member”) within the 180-day period prior to the initial filing of the Registration Statement, other than the prior payments to the Representatives in connection with the Offering. The Company has not issued any warrants or other securities, or granted any options, directly or indirectly, to any Participating Member within the 180-day period prior to the initial filing date of the Registration Statement. No person to whom securities of the Company have been privately issued within the 180-day period prior to the initial filing date of the Registration Statement has any relationship or affiliation or association with any Participating Member. Except with respect to the Representatives in connection with the Offering, the Company has not entered into any agreement or arrangement (including, without limitation, any consulting agreement or any other type of agreement) during the 180-day period prior to the initial filing date of the Registration Statement with the Commission, which arrangement or agreement provides for the receipt of any “underwriting compensation” as defined in Rule 5110 of the FINRA Manual.
2.17.3 FINRA Affiliation. Except as disclosed in the FINRA Questionnaires provided to the Representatives, to the Company’s knowledge, no officer or director or any direct or indirect beneficial owner (including the Insiders) of any class of the Company’s unregistered securities (whether debt or equity, registered or unregistered, regardless of the time acquired or the source from which derived) has any direct or indirect affiliation or association with any Participating Member (as determined in accordance with the rules and regulations of FINRA). The Company will advise the Representatives and ML&B if it learns that any officer or director or any direct or indirect beneficial owner (including the Insiders) is or becomes an affiliate or associated person of a Participating Member.
2.17.4 Share Ownership. Except as disclosed in the FINRA Questionnaires provided to the Representatives, to the Company’s knowledge, no officer or director or any direct or indirect beneficial owner (including the Insiders) of any class of the Company’s unregistered securities is an owner of shares or other securities of any Participating Member (other than securities purchased on the open market).
2.17.5 Loans. To the Company’s knowledge, no officer or director or any direct or indirect beneficial owner (including the Insiders) of any class of the Company’s unregistered securities has made a subordinated loan to any Participating Member in the Offering.
2.17.6 Proceeds of the Offering. Except as described in the Registration Statement, the Sale Preliminary Prospectus or the Prospectus, no proceeds from the sale of the Public Securities (excluding underwriting compensation) or the Placement Warrants, will be paid to any Participating Member, except as specifically authorized herein.
2.17.7 Conflicts of Interest. To the Company’s knowledge, assuming reasonable inquiry, no Participating Member in the Offering has a conflict of interest with the Company. For this purpose, a “conflict of interest” exists when a member of FINRA and/or its associated persons, parent or affiliates in the aggregate beneficially own 10% or more of the Company’s outstanding common equity or 10% or more of the Company’s preferred equity.
2.18 Taxes.
2.18.1 There are no transfer taxes or other similar fees or charges under U.S. federal law or the laws of any U.S. state or any political subdivision of the United States, or under the laws of any non-U.S. jurisdiction, required to be paid in connection with the execution and delivery of this Agreement or the issuance or sale by the Company of the Public Securities.
2.18.2 The Company has filed all U.S. federal, state and local, and non-U.S., tax returns required to be filed with taxing authorities prior to the date hereof in a timely manner or has duly obtained extensions of time for the filing thereof. The Company has paid all taxes shown as due on such returns that were filed and has paid all taxes imposed on it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable. In the case of each of the foregoing, except where the failure to file or pay, as applicable, would not have a Material Adverse Effect. The Company has made appropriate provisions in the applicable financial statements referred to in Section 2.5.1 above in respect of all federal, state, local and foreign income and franchise taxes for all current or prior periods as to which the tax liability of the Company has not been finally determined.
2.19 Foreign Corrupt Practices Act; Anti-Money Laundering; Patriot Act.
2.19.1 Foreign Corrupt Practices Act. Neither the Company nor to the Company’s knowledge, assuming reasonable inquiry, any of the Insiders or any other person acting on behalf of the Company has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder the business of the Company (or assist it in connection with any actual or proposed transaction) that (i) might subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding; (ii) if not given in the past, might have had a Material Adverse Effect; or (iii) if not continued in the future, might adversely affect the assets, business or operations of the Company. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the Foreign Corrupt Practices Act of 1977, as amended.
2.19.2 Currency and Foreign Transactions Reporting Act. The operations of the Company are and have been conducted at all times in compliance with (i) the requirements of the U.S. Treasury Department Office of Foreign Asset Control and (ii) applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transaction Reporting Act of 1970, as amended, including the Money Laundering Control Act of 1986, as amended, the rules and regulations thereunder and any related or similar money laundering statutes, rules, regulations or guidelines, issued, administered or enforced by any Federal governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to the Company’s knowledge, threatened.
2.19.3 Patriot Act. Neither the Company nor to the Company’s knowledge, assuming reasonable inquiry, any Insider has violated the Bank Secrecy Act of 1970, as amended, or the Uniting and Strengthening of America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, and/or the rules and regulations promulgated under any such law, or any successor law.
2.20 Officers’ Certificate. Any certificate signed by any duly authorized officer of the Company in connection with the Offering and delivered to the Representatives or to ML&B shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
2.21 Agreements With Insiders.
2.21.1 Insider Letter. The Company has caused to be duly executed a legally binding and enforceable agreement (except (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification, contribution or non-compete provision may be limited under foreign, federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought), a form of which is annexed as an exhibit to the Registration Statement (the “Insider Letter”), pursuant to which each of the Insiders of the Company agree to certain matters. The Insider Letter shall not be amended, modified or otherwise changed without the prior written consent of the Representatives, which consent shall not be unreasonably delayed, conditioned or withheld by the Representatives.
2.21.2 Sponsor Purchase Agreement. The Company and the Sponsor have executed and delivered a Private Placement Warrants Purchase Agreement, the form of which is annexed as an exhibit to the Registration Statement (the “Sponsor Purchase Agreement”), pursuant to which the Sponsor will, among other things, on the Closing Date consummate the purchase of and deliver the purchase price for the Placement Warrants to be sold to the Sponsor as provided in the Sponsor Purchase Agreement. Pursuant to the Insider Letter, the Sponsor has waived any and all rights and claims it may have to any proceeds, and any interest thereon, held in the Trust Account in respect of the Placement Warrants. Certain proceeds from the sale of the Placement Warrants will be deposited by the Company in the Trust Account in accordance with the terms of the Trust Agreement on the Closing Date as provided for in the Sponsor Purchase Agreement.
2.21.3 Underwriters Purchase Agreement. The Company and the Underwriters have executed and delivered a Private Placement Warrants Purchase Agreement, the form of which is annexed as an exhibit to the Registration Statement (the “Underwriters Purchase Agreement,” and together with the Sponsor Purchase Agreement, the “Purchase Agreements”), pursuant to which the Underwriters will, among other things, on the Closing Date, consummate the purchase of and deliver the purchase price for the Placement Warrants to be sold to the Underwriters as provided in the Underwriters Purchase Agreement. Certain proceeds from the sale of the Placement Warrants will be deposited by the Company in the Trust Account in accordance with the terms of the Trust Agreement on the Closing Date as provided for in the Underwriters Purchase Agreement.
2.21.4 Administrative Services. The Company and the Sponsor have entered into an agreement (“Services Agreement”) substantially in the form annexed as an exhibit to the Registration Statement pursuant to which an affiliate of the Sponsor will make available to the Company office space administrative services including office space, utilities, secretarial and administrative support for $10,000 per month and the Company will reimburse the Sponsor for any reasonable and documented out-of-pocket expenses related to identifying, investigating and completing a Business Combination. Upon completion of the Business Combination, the Company will cease paying such monthly fees.
2.21.5 Registration Rights Agreement. The Company, the Sponsor and the Underwriters have entered into a Registration and Shareholder Rights Agreement (“Registration Rights Agreement”) substantially in the form annexed as an exhibit to the Registration Statement, whereby such parties will be entitled to certain registration rights with respect to the securities they hold or may hold, as set forth in such Registration Rights Agreement and described more fully in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus.
2.21.6 Loans. The Sponsor has agreed to make loans to the Company in the aggregate amount of up to $300,000 (the “Insider Loans”) pursuant to a promissory note substantially in the form annexed as an exhibit to the Registration Statement. The Insider Loans do not bear any interest and are repayable by the Company on the earlier of December 31, 2024 and the consummation of the Offering.
2.22 Investment Management Trust Agreement. The Company has entered into the Trust Agreement with respect to certain proceeds of the Offering and the Warrant Private Placement substantially in the form annexed as an exhibit to the Registration Statement.
2.23 Warrant Agreement. The Company has entered into a warrant agreement with CST with respect to the Warrants underlying the Units, the Placement Warrants and certain other warrants that may be issued by the Company substantially in the form filed as an exhibit to the Registration Statement (“Warrant Agreement”).
2.24 No Existing Non-Competition Agreements. No Insider is subject to any non-competition agreement or non-solicitation agreement with any employer or prior employer which could materially affect his ability to be an employee, officer and/or director of the Company, except as disclosed in the Registration Statement.
2.25 Investments. No more than 45% of the “value” (as defined in Section 2(a)(41) of the Investment Company Act of 1940, as amended (the “Investment Company Act”)) of the Company’s total assets consist of, and no more than 45% of the Company’s net income after taxes is derived from, securities other than “Government Securities” (as defined in Section 2(a)(16) of the Investment Company Act) or money market funds meeting the conditions of Rule 2a-7 of the Investment Company Act.
2.26 Investment Company Act. The Company is not required, and upon the issuance and sale of the Securities as herein contemplated and the application of the net proceeds therefrom as described in the Sale Preliminary Prospectus and the Prospectus will not be required, to register as an “investment company” under the Investment Company Act.
2.27 Subsidiaries. The Company does not own an interest in any corporation, partnership, limited liability company, joint venture, trust or other business entity.
2.28 Related Party Transactions. No relationship, direct or indirect, exists between or among the Company, on the one hand, and any Insider, on the other hand, which is required by the Act, the Exchange Act or the Regulations to be described in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus which is not so described as required. There are no outstanding loans, advances (except normal advances for business expenses in the ordinary course of business), or guarantees of indebtedness by the Company to or for the benefit of any of the officers or directors of the Company or any of their respective family members, except as disclosed in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus. The Company has not extended or maintained credit, arranged for the extension of credit, or renewed an extension of credit, in the form of a personal loan to or for any director or officer of the Company.
2.29 No Influence. The Company has not offered, or caused the Underwriters to offer, the Firm Units to any person or entity with the intention of unlawfully influencing (a) a customer or supplier of the Company or any affiliate of the Company to alter the customer’s or supplier’s level or type of business with the Company or such affiliate or (b) a journalist or publication to write or publish favorable information about the Company or any such affiliate.
2.30 Sarbanes-Oxley. The Company is, and on the Closing Date will be, in material compliance with the provisions of the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley”), and the rules and regulations promulgated thereunder and related or similar rules or regulations promulgated by any governmental or self-regulatory entity or agency, that are applicable to it as of the date hereof.
2.31 Distribution of Offering Material by the Company. The Company has not distributed and will not distribute, prior to the later of the Closing Date and the completion of the distribution of the Units, any offering material in connection with the offering and sale of the Units other than the Sale Preliminary Prospectus and the Prospectus, in each case as supplemented and amended.
2.32 The Nasdaq Global Market. The Public Securities have been authorized for listing, subject to official notice of issuance and evidence of satisfactory distribution, on the Nasdaq Global Market and the Company knows of no reason or set of facts that is likely to adversely affect such authorization.
2.33 Board of Directors. As of the Effective Date, the Board of Directors of the Company will be comprised of the persons set forth as “Directors” or “Director nominees” under the heading of the Sale Preliminary Prospectus and the Prospectus captioned “Management.” As of the Effective Date, the qualifications of the persons serving as board members and the overall composition of the board will comply with Sarbanes-Oxley and the rules promulgated thereunder and the rules of Nasdaq that are, in each case, applicable to the Company. As of the Effective Date, the Company will have an Audit Committee that satisfies the applicable requirements under Sarbanes-Oxley and the rules promulgated thereunder and the rules of Nasdaq, subject to the permitted phase-in requirements under the rules of Nasdaq.
2.34 Emerging Growth Company. From its formation through the date hereof, the Company has been and is an “emerging growth company,” as defined in Section 2(a) of the Act (an “Emerging Growth Company”).
2.35 No Disqualification Events. Neither the Company, nor any of its predecessors or any affiliated issuer, nor any director, executive officer, or other officer of the Company participating in the Offering, nor any beneficial owner of 20% or more of the Company’s outstanding voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under the Act) connected with the Company in any capacity at the time of sale (each, a “Company Covered Person” and, together, “Company Covered Persons”) is subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Company Covered Person is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under Rule 506(e), and has furnished to the Underwriters a copy of any disclosures provided thereunder.
2.36 Free-Writing Prospectus and Testing-the-Waters. The Company has not made any offer relating to the Public Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 under the Act, or that would otherwise constitute a “free writing prospectus” as defined in Rule 405 under the Act. The Company: (a) has not engaged in any Testing-the-Waters Communication other than Testing-the-Waters Communications with the consent of the Representatives with entities that are qualified institutional buyers within the meaning of Rule 144A under the Act or institutions that are accredited investors within the meaning of Rule 501(a) of Regulation D under the Act and (b) has not authorized anyone to engage in Testing-the-Waters Communications other than its officers and the Representatives and individuals engaged by the Representatives. The Company has not distributed any written Testing-the-Waters Communications other than those listed on Schedule B hereto. “Testing-the-Waters Communication” means any oral or written communication with potential investors undertaken in reliance on Section 5(d) of the Act.
2.37 No Fee Arrangements. As of the date hereof, the Company has not entered into any agreement, written or oral, pursuant to which the Company will be obligated to pay any Insider or an affiliate of any Insider a consulting, finder or success fees for assisting the Company in consummating a Business Combination.
3. Covenants of the Company. The Company covenants and agrees as follows:
3.1 Amendments to Registration Statement. The Company will deliver to the Representatives, prior to filing, any amendment or supplement to the Registration Statement, any Preliminary Prospectus or the Prospectus proposed to be filed after the Effective Date and the Company shall not file any such amendment or supplement to which the Representatives reasonably objects in writing.
3.2 Federal Securities Laws.
3.2.1 Compliance. During the time when a Prospectus is required to be delivered under the Act, the Company will use its commercially reasonable efforts to comply with all requirements imposed upon it by the Act, the Regulations, and the Exchange Act, and by the regulations under the Exchange Act, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities in accordance with the provisions hereof and the Sale Preliminary Prospectus and the Prospectus. If at any time when a Prospectus relating to the Securities is required to be delivered under the Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend or supplement the Prospectus to comply with the Act, the Company will notify the Representatives promptly and prepare and file with the Commission, subject to Section 3.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Act.
3.2.2 Filing of Final Prospectus. The Company will file the Prospectus (in form and substance satisfactory to the Underwriters) with the Commission pursuant to the requirements of Rule 424 of the Regulations.
3.2.3 Exchange Act Registration. The Company will use its commercially reasonable efforts to maintain the registration of the Public Securities under the provisions of the Exchange Act (except in connection with a going-private transaction) for a period of five (5) years from the Effective Date, or until the Company is required to be liquidated or is acquired, if earlier, or, in the case of the Warrants, until the Warrants expire and are no longer exercisable or have been exercised or redeemed in full. The Company will not deregister the Public Securities under the Exchange Act (except in connection with a going private transaction after the completion of a Business Combination) without the prior written consent of the Representatives.
3.2.4 Exchange Act Filings. From the Effective Date until the earlier of the Company’s initial Business Combination, or its liquidation and dissolution, the Company shall timely file with the Commission via the Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”) such statements and reports as are required to be filed by a company registered under Section 12(b) of the Exchange Act.
3.2.5 Sarbanes-Oxley Compliance. As soon as it is legally required to do so, the Company shall take all actions necessary to obtain and thereafter maintain material compliance with each applicable provision of Sarbanes-Oxley and the rules and regulations promulgated thereunder and related or similar rules and regulations promulgated by any other governmental or self-regulatory entity or agency with jurisdiction over the Company.
3.3 Free-Writing Prospectus. The Company agrees that it will not make any offer relating to the Public Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 under the Act, or that would otherwise constitute a “free writing prospectus” as defined in Rule 405 under the Act, without the prior consent of the Underwriters.
3.4 Delivery to Underwriters of Prospectuses. The Company will deliver to the Underwriters, without charge and from time to time during the period when the Prospectus is required to be delivered under the Act or the Exchange Act, such number of copies of each of the Preliminary Prospectus and the Prospectus as the Underwriters may reasonably request and, as soon as the Registration Statement or any amendment or supplement thereto becomes effective, deliver to the Underwriters, upon their request, two manually executed Registration Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and all manually executed consents of certified experts.
3.5 Effectiveness and Events Requiring Notice to the Representatives. The Company will use its commercially reasonable efforts to cause the Registration Statement to remain effective and will notify the Representatives immediately and confirm the notice in writing (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto or preventing or suspending the use of any Preliminary Prospectus or the Prospectus or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any foreign or state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event that, in the reasonable judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, and in the light of the circumstances under which they were made, not misleading. If the Commission or any foreign or state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.
3.6 Affiliated Transactions.
3.6.1 Business Combinations. The Company will not consummate a Business Combination with any entity that is affiliated with any Insider unless (i) the Company, or a committee of its independent and disinterested directors, obtains an opinion from an independent investment banking firm, or from an independent accounting firm that commonly renders valuation opinions that the Business Combination is fair to the Company’s shareholders from a financial point of view and (ii) a majority of the Company’s disinterested and independent directors (if there are any) approve such transaction.
3.6.2 Compensation to Insiders. Except as disclosed in the Prospectus, the Company shall not pay any of the Insiders or any of their affiliates any fees or compensation from the Company, for services rendered to the Company prior to, or in connection with, the consummation of a Business Combination.
3.7 [Reserved.]
3.8 Reports to the Representatives. For a period of five (5) years from the Effective Date or until such earlier time upon which the Company is required to be liquidated or is no longer required to file reports under the Exchange Act, the Company will furnish to the Representatives and their counsel copies of such financial statements and other periodic and special reports as the Company from time to time furnishes generally to holders of any class of its securities, and promptly furnish to the Underwriters (i) a copy of each periodic report the Company shall be required to file with the Commission, (ii) a copy of every press release and every news item and article with respect to the Company or its affairs that was released by the Company, (iii) a copy of each Current Report on Form 8-K or Schedules 13D, 13G, 14D-1 or 13E-4 received or prepared by the Company, (iv) two (2) copies of each registration statement filed by the Company with the Commission under the Act, and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company as the Representatives may from time to time reasonably request; provided the Representatives shall sign, if requested by the Company, a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representatives and their counsel in connection with the Representatives’ receipt of such information. Documents filed or furnished with the Commission pursuant to its EDGAR system shall be deemed to have been delivered to the Representatives pursuant to this Section.
3.9 Transfer Agent. For a period of five (5) years following the Effective Date or until such earlier time upon which the Company is required to be liquidated, the Company shall retain a transfer agent and warrant agent acceptable to the Representatives. CST is acceptable to the Underwriters.
3.10 Payment of Expenses. The Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not paid at the Closing Date, all Company expenses incident to the performance of the obligations of the Company under this Agreement, including but not limited to (i) the Company’s legal and accounting fees and disbursements; (ii) the preparation, printing, filing, mailing and delivery (including the payment of postage with respect to such mailing) of the Registration Statement, the Preliminary Sale Prospectus and the Prospectus, including any pre- or post-effective amendments or supplements thereto, and the printing and mailing of this Agreement and related documents, including the cost of all copies thereof and any amendments thereof or supplements thereto supplied to the Underwriters in quantities as may be required by the Underwriters; (iii) fees incurred in connection with conducting background checks of the Company’s management team, up to a maximum of $3,000 per person; (iv) the preparation, printing, engraving, issuance and delivery of the Units, the Ordinary Shares and the Warrants included in the Units, including any transfer or other taxes payable thereon; (v) filing fees incurred in registering the Offering with FINRA and the reasonable fees of counsel of the Underwriters (such legal fees not to exceed $15,000) in connection therewith and including, without limitation, fees associated with qualifying the Offering under the “Blue Sky” laws of any states specified by the Representatives; (vi) fees, costs and expenses incurred in listing the Securities on the Nasdaq Global Market or such other stock exchanges as the Company and the Underwriters together determine; (vii) all fees and disbursements of the transfer and warrant agent; (viii) all of the Company’s expenses associated with “due diligence” and “road show” meetings arranged by the Representatives and any presentations made available by way of a net roadshow, including without limitation, trips for the Company’s management to meet with prospective investors, all travel, food and lodging expenses associated with such trips incurred by the Company or such management; and (ix) all other costs and expenses customarily borne by an issuer incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section 3.10, provided that the expenses reimbursed to the Underwriters shall not exceed $75,000 in the aggregate. If the Offering is consummated, the Representatives may deduct from the net proceeds of the Offering payable to the Company on the Closing Date the expenses set forth above (which shall be mutually agreed upon between the Company and the Representatives prior to the Closing Date) to be paid by the Company to the Representatives and others. In addition, the Company hereby also agrees to pay, promptly upon the request of the Representatives, all reasonable out of pocket expenses incurred by any of the Underwriters which are associated with any Business Combination marketing activities or capital markets advisory activities undertaken by any of the Underwriters at the request of the Company (such activities, “Business Combination Services” and such Underwriters, “Business Combination Advisors”). The Company shall also pay for the costs and expenses incurred by the Business Combination Advisors in connection with the Business Combination to the extent provided for in Section 3.33. If the Offering is not consummated for any reason (other than a breach by the Representatives of any of its obligations hereunder), then the Company shall reimburse the Representatives in full for their reasonable and documented out-of-pocket expenses actually incurred, including, without limitation, reasonable fees and disbursements of counsel to the Underwriters related to FINRA matters.
3.11 Application of Net Proceeds. The Company will apply the net proceeds from the Offering and the Warrant Private Placement received by it in a manner consistent in all material respects with the application described under the caption “Use of Proceeds” in the Prospectus.
3.12 Delivery of Earnings Statements to Security Holders. The Company will make generally available to its security holders as soon as practicable an earnings statement (which need not be certified by an independent registered public accounting firm unless required by the Act or the Regulations, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Act) covering a period of at least twelve consecutive months beginning after the Effective Date.
3.13 Notice to FINRA.
3.13.1 Notice to the Representatives. For a period of sixty (60) days after the date of the Prospectus, in the event any person or entity (regardless of any FINRA affiliation or association) is engaged, in writing, to assist the Company in its search for a Target Business or to provide any other services in connection therewith, the Company will provide the following to the Representatives prior to the consummation of the Business Combination: (i) complete details of all services and copies of agreements governing such services, and (ii) justification as to why the person or entity providing the merger and acquisition services should not be considered a Participating Member with respect to the Offering, as such term is defined in Rule 5110 of the FINRA Manual. The Company also agrees that, if required by law, proper disclosure of such arrangement or potential arrangement will be made in the tender offer documents or proxy statement which the Company will file with the Commission in connection with the Business Combination.
3.13.2 FINRA. The Company shall advise the Representatives if it is aware that any 10% or greater shareholder of the Company becomes an affiliate or associated person of a Participating Member.
3.13.3 Broker/Dealer. In the event the Company intends to register as a broker/dealer, merge with or acquire a registered broker/dealer, or otherwise become a member of FINRA, it shall promptly notify FINRA.
3.14 Stabilization. Neither the Company, nor to its knowledge, any of its employees, directors or shareholders (without the consent of the Representatives) has taken and the Company will not take, and has directed its employees, directors or shareholders to not take, directly or indirectly, any action without the consent of the Representatives that is designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Units.
3.15 Existing Lock-Up Agreement. The Company will use its best efforts to enforce all existing agreements between the Company and any of its security holders that prohibit the sale, transfer, assignment, pledge or hypothecation of any of the Securities in connection with the Offering. In addition, the Company will direct the Company’s transfer agent to place stop transfer restrictions upon any such Securities of the Company that are bound by such existing “lock-up” agreements for the duration of the periods contemplated in such agreements.
3.16 Payment of Deferred Underwriting Commission on Business Combination. Upon the occurrence of the Specified Event, the Company agrees that it will cause the Trustee to pay the Deferred Underwriting Commission directly from the Trust Account to the Underwriters, in accordance with Section 1.3.
3.17 Internal Controls. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that (i) transactions are executed in accordance with management’s general or specific authorization, (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
3.18 Accounting Firm. Until the earlier of the consummation of the Company’s initial Business Combination or until such earlier time upon which the Company is required to be liquidated, the Company shall retain Withum or another independent registered public accounting firm reasonably acceptable to the Representatives.
3.19 Form 8-K. The Company shall, on or prior to the date hereof, retain its independent registered public accounting firm to audit the balance sheet of the Company as of the Closing Date (“Audited Financial Statements”) reflecting the receipt by the Company of the proceeds of the Offering and the Warrant Private Placement. Within four (4) Business Days after the Closing Date, the Company shall file a Current Report on Form 8-K with the Commission, which Report shall contain the Company’s Audited Financial Statements. Promptly after the Option Closing Date, if the Over-allotment Option is exercised after the Closing Date, the Company shall file with the Commission a Current Report on Form 8-K or an amendment to the Form 8-K to provide updated financial information to reflect the exercise of such option.
3.20 Corporate Proceedings. All corporate proceedings and other legal matters necessary to carry out the provisions of this Agreement and the transactions contemplated hereby shall have been done to the reasonable satisfaction to the Representatives and ML&B.
3.21 Investment Company. The Company shall cause the proceeds of the Offering to be held in the Trust Account to be invested only as provided for in the Trust Agreement and disclosed in the Prospectus. The Company will conduct its business in a manner so that it will not become subject to the Investment Company Act. Furthermore, once the Company consummates a Business Combination, it shall be engaged in a business other than that of investing, reinvesting, owning, holding or trading securities.
3.22 Amendments to Charter Documents. The Company covenants and agrees, that prior to its initial Business Combination it will not seek to amend or modify its Charter Documents, except in accordance with the procedures set forth therein.
3.23 Press Releases. The Company agrees that it will not issue press releases or engage in any other publicity, without the Representatives’ prior written consent (not to be unreasonably withheld), for a period of twenty-five (25) days after the Closing Date. Notwithstanding the foregoing, in no event shall the Company be prohibited from issuing any press releases or engaging in any other publicity required by law, except that including the name of any Underwriter therein shall require the prior written consent of such Underwriter.
3.24 Insurance. Until the earlier of the consummation of the Company’s initial Business Combination or until such earlier time upon which the Company is required to be liquidated, the Company will maintain directors’ and officers’ insurance (including, without limitation, insurance covering the Company, its directors and officers for liabilities or losses arising in connection with the Offering, including, without limitation, liabilities or losses arising under the Act, the Exchange Act, the Regulations and any applicable foreign securities laws).
3.25 Electronic Prospectus. The Company shall cause to be prepared and delivered to the Underwriters, at the Company’s expense, promptly, but in no event later than two (2) Business Days from the effective date of this Agreement, an Electronic Prospectus to be used by the Underwriters in connection with the Offering. As used herein, the term “Electronic Prospectus” means a form of prospectus, and any amendment or supplement thereto, that meets each of the following conditions: (i) it shall be encoded in an electronic format, satisfactory to the Representatives, that may be transmitted electronically by the Underwriters to offerees and purchasers of the Units for at least the period during which a prospectus relating to the Units is required to be delivered under the Act; (ii) it shall disclose the same information as the paper prospectus and prospectus filed pursuant to EDGAR, except to the extent that graphic and image material cannot be disseminated electronically, in which case such graphic and image material shall be replaced in the electronic prospectus with a fair and accurate narrative description or tabular representation of such material, as appropriate; and (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory to the Representatives, that will allow recipients thereof to store and have continuously ready access to the prospectus at any future time, without charge to such recipients (other than any fee charged for subscription to the Internet as a whole and for on-line time).
3.26 Warrant Private Placement Proceeds. On or prior to the Closing Date the Company shall have caused the applicable proceeds from the Warrant Private Placement to be deposited in the Trust Account pursuant to the terms of the Purchase Agreements.
3.27 Future Financings. The Company agrees that neither it, nor any successor or subsidiary of the Company, will consummate any public or private equity or debt financing prior to the consummation of a Business Combination, unless all investors in such financing expressly waive, in writing, any rights in or claims against the Trust Account.
3.28 Amendments to Certain Agreements. The Company shall not amend, modify or otherwise change the Insider Letter and the Trust Agreement without the prior written consent of the Representatives, which such consent shall not be unreasonably delayed, conditioned or withheld by the Representatives. The Trust Agreement shall provide that the trustee is required to obtain a joint written instruction signed by both the Company and the Representatives with respect to the transfer of the funds held in the Trust Account from the Trust Account, prior to commencing any liquidation of the assets of the Trust Account in connection with the consummation of any Business Combination, and such provision of the Trust Agreement shall not be permitted to be amended without the prior written consent of the Representatives.
3.29 Maintenance of Listing on Nasdaq. Until the consummation of a Business Combination, the Company will use its commercially reasonable efforts to maintain the listing of the Public Securities on Nasdaq or a national securities exchange acceptable to the Representatives.
3.30 Reservation of Shares. The Company will reserve and keep available that maximum number of its authorized but unissued securities which are issuable (i) upon exercise of the Warrants and Placement Warrants outstanding from time to time and (ii) upon conversion of the Founder Shares.
3.31 Notice of Disqualification Events. The Company will notify the Underwriters in writing, prior to the Closing Date, of (i) any Disqualification Event relating to any Company Covered Person and (ii) any event that would, with the passage of time, become a Disqualification Event relating to any Company Covered Person.
3.32 Disqualification of S-1. Until the earlier of seven (7) years from the date hereof or until the Warrants have either expired and are no longer exercisable or have all been exercised or redeemed, the Company will not take any action or actions that prevent or disqualify the Company’s use of Form S-1 (or other appropriate form) for the registration of the Ordinary Shares issuable upon exercise of the Warrants under the Act.
3.33 Business Combination Securities Disclosure Documents. If a Business Combination Advisor may be deemed, in its sole judgment, to be an underwriter of any securities issued pursuant to any registration statement or tender offer document filed with the Commission in connection with the consummation of the Business Combination by the Company, a Target Business or any direct or indirect parent or subsidiary of any of them (any such issuer or co-issuer, a “Registrant,” and any such securities, the “Business Combination Securities”), the Company shall provide or cause to be provided to such Business Combination Advisor information and access to all persons, properties and documents to the extent necessary for such Business Combination Advisor to complete a due diligence investigation sufficient (in the view of such Business Combination Advisor in its sole discretion) to provide such Business Combination Advisor with a “reasonable due diligence” defense in respect of any claims that could be brought against an underwriter of the applicable Business Combination Securities under federal and state securities laws, rules and regulations, including, without limitation, Section 11 of the Act. As used herein, the term “reasonable due diligence” means a reasonable investigation that provides the investigating person a reasonable ground to believe that at the time of the applicable offer, issuance or distribution of any Business Combination Securities, no registration statement, preliminary or final prospectus, proxy statement, tender offer document or offering memorandum, including, without limitation, any document incorporated by reference into any of the foregoing, or any amendment or supplement to any of the foregoing, or any other marketing document used by any Registrant, filed with or furnished by the Company to the Commission in connection with the Business Combination but excluding any filing under Rule 425 of the Act or Rule 14a-12 of the Exchange Act (each, a “Business Combination Securities Disclosure Document”), in each case relating to such offer, issuance or distribution, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. The Company agrees that it will provide to such Business Combination Advisor notice of each filing under Rule 425 of the Act or Rule 14a-12 of the Exchange Act and each other form of public communication about the Business Combination reasonably in advance of such filing or public communication. The Company further covenants that it will use its best efforts to ensure that any projections provided to such Business Combination Advisor by any Registrant or prepared by any Registrant or any representative of such Registrant (a “Registrant Representative”) and contained in any Business Combination Securities Disclosure Document, in each case, at the time they were prepared, will have been prepared in good faith and will be based upon assumptions which, in light of the circumstances under which they are made, are reasonable.
3.34 Obligations in Connection with Business Combination. If requested in writing by a Business Combination Advisor, if it may be deemed, in its sole judgment, to be an underwriter of any Business Combination Securities, the following shall apply:
3.34.1 Prior to entering into any definitive agreement with respect to the Business Combination (or amendment thereto) and until such time as such Business Combination is consummated:
(a) The Company agrees to notify such Business Combination Advisor with respect to, and to permit such Business Combination Advisor, at its request, to participate in, all diligence sessions with any Registrant or any Registrant Representative and all drafting sessions in respect of any Business Combination Securities Disclosure Document.
(b) The Company shall provide drafts of all Business Combination Securities Disclosure Documents to such Business Combination Advisor and its legal counsel reasonably in advance of the filing by the Company (or, if such filing is to be made by a Registrant other than the Company, any filing which is required to be approved by the Company) of any Business Combination Securities Disclosure Document with the Commission or the circulation by any Registrant of any Business Combination Securities Disclosure Document to any prospective investor, sufficient to allow such Business Combination Advisor and its legal counsel to request changes determined by them to be reasonably necessary to such Business Combination Securities Disclosure Document before its filing or circulation. The Company shall not permit the filing with or furnishing to the Commission of any Business Combination Securities Disclosure Document without the consent of such Business Combination Advisor, which consent shall not unreasonably be withheld, delayed or conditioned.
3.34.2 Notwithstanding any provision to the contrary herein, the Company agrees that such Business Combination Advisor shall have the right, in connection with its reasonable due diligence under Section 3.33, (i) to retain counsel and other consultants and experts as it may deem necessary or desirable in connection with its reasonable due diligence under Section 3.34.1 (it being understood that the retention of any such consultant or expert or other advisor, other than outside legal counsel, will be made with the prior written approval of the Company, which approval will not be unreasonably withheld, conditioned or delayed); (ii) to use its reasonable best efforts to ensure that each counsel to the Company and to any other Registrant provides customary legal opinions and negative assurance letters to such Business Combination Advisor dated as of (x) the date of effectiveness of the Business Combination Securities Disclosure Document, and (y) the date of the shareholder vote to approve the Business Combination, in form and substance reasonably satisfactory to such Business Combination Advisor, (iii) to use its reasonable best efforts to ensure that each accounting firm or firms that were retained by the Company or by any other Registrant and that have audited any financial statements set forth in any Business Combination Securities Disclosure Document provide customary “comfort letters” to such Business Combination Advisor dated as of (x) the date of effectiveness of the Business Combination Securities Disclosure Document, and (y) the date of the shareholder vote to approve the Business Combination; and (iv) to take and shall use its reasonable best efforts to take any other actions reasonably requested by such Business Combination Advisor.
3.34.3 In connection with the Business Combination, to the extent the Company retains an unaffiliated party (the “Fairness Opinion Provider”) to prepare a report and provide an opinion (the “Fairness Opinion”) concerning the fairness, from a financial point of view, of the Business Combination to the Company and its unaffiliated shareholders, the Company shall, pursuant to, and in accordance with, applicable law, disclose in reasonable detail in a Business Combination Securities Disclosure Document the results of that report and, as necessary or appropriate, a copy of that report. Each Registrant shall provide the Fairness Opinion Provider with all information and access to persons and documents that the Fairness Opinion Provider deems reasonably necessary and appropriate in connection with the preparation of its Fairness Opinion.
3.34.4 Prior to the consummation of the Business Combination, the Company shall include in the definitive agreement for the Business Combination (i) a covenant for the assignment and assumption, by the public entity resulting from the initial Business Combination, of all of the Company’s obligations hereunder and (ii) that such Business Combination Advisor may rely on the representations and warranties contained therein as if it were a party thereto. The Company shall use its reasonable best efforts to ensure that each Target Business in the Business Combination agrees to deliver to such Business Combination Advisor a certificate of an officer of such Target Business stating that to such officer’s knowledge the representations and warranties made by the Target Business in the definitive agreement for the Business Combination are true and correct as of the date of such certificate, subject to (i) a customary materiality standard, (ii) any applicable carve-out with reference to disclosure included in the Business Combination Securities Disclosure Document and (iii) required adjustments for such representations and warranties that speak as of a specific date. In addition, in connection with the Business Combination, the Company will, and will use its reasonable best efforts to cause each Registrant to, comply in all material respects with (i) the obligations and covenants of the Company which relate to the period following the Business Combination Closing set forth in Sections 3 and 5 of this Agreement and (ii) all laws, rules and regulations applicable either to the Registrant and its business activities or to the Business Combination, as such laws, rules and regulations may be in effect at the time of the consummation of the Business Combination.
3.34.5 Nothing herein shall be deemed to require the Underwriters to limit their rights to compensation or to reimbursement of expenses without their express agreement or otherwise to assume any liability other than as may be expressly required under the Act.
3.34.6 The Company acknowledges and agrees that nothing in this Section 3.34 shall be interpreted to obligate the Underwriters to take any action, or to refrain from taking any action, in connection with the Business Combination and any such actions will be undertaken by each Underwriter, in respect of itself, in its sole discretion.
4. Conditions of Underwriters’ Obligations. The obligations of the Underwriters to purchase and pay for the Units, as provided herein, shall be subject to the continuing accuracy of the representations and warranties of the Company as of the date hereof and as of each of the Closing Date and the Option Closing Date, if any, to the accuracy of the statements of officers of the Company made pursuant to the provisions hereof and to the performance by the Company of its obligations hereunder and to the following conditions:
4.1 Regulatory Matters.
4.1.1 Effectiveness of Registration Statement. The Registration Statement shall have become effective not later than 4:00 p.m., New York time, on the date of this Agreement or such later date and time as shall be consented to in writing by the Representatives, and, at each of the Closing Date and each Option Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for the purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representatives and ML&B.
4.1.2 FINRA Clearance. By the Effective Date, the Underwriters shall have received clearance from FINRA as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement.
4.1.3 No Blue Sky Stop Orders. No order suspending the sale of the Units in any jurisdiction designated by the Underwriters pursuant to Section 3.5 hereof shall have been issued on each of the Closing Date or any Option Closing Date, and no proceedings for that purpose shall have been instituted or, to the Company’s knowledge, shall be contemplated.
4.1.4 No Commission Stop Order. At the Closing Date and each Option Closing Date, the Commission has not issued any order or threatened to issue any order preventing or suspending the use of any Preliminary Prospectus, the Prospectus or any part thereof, and has not instituted or, to the Company’s knowledge, assuming reasonable inquiry, threatened to institute any proceedings with respect to such an order.
4.1.5 Approval of Listing on Nasdaq. The Securities shall have been approved for listing on the Nasdaq Global Market, subject to official notice of issuance and evidence of satisfactory distribution, satisfactory evidence of which shall have been provided to the Representatives.
4.2 Company Counsel Matters.
4.2.1 Closing Date and Option Closing Date Opinions of Counsels. On the Closing Date and each Option Closing Date, if any, the Representatives shall have received the favorable opinions and negative assurance statements of Ellenoff Grossman & Schole LLP and Ogier (Cayman) LLP, dated the Closing Date or each Option Closing Date, as the case may be, addressed to the Representatives as representatives for the several Underwriters and in form and substance satisfactory to the Representatives and ML&B. On the Closing Date and each Option Closing Date, the Representatives shall have received the favorable opinion and negative assurance statement of ML&B, dated the Closing Date, addressed to the Representatives as representatives for the several Underwriters.
4.2.2 Reliance. In rendering such opinions, such counsels may rely as to matters of fact, to the extent they deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdictions having custody of documents respecting the corporate existence or good standing of the Company, provided that copies of any such statements or certificates shall be delivered to the Representatives’ counsel if requested.
4.3 Comfort Letter. At the time this Agreement is executed, and at the Closing Date and Option Closing Date, if any, the Representatives shall have received a letter, addressed to the Representatives as representatives for the several Underwriters and in form and substance satisfactory in all respects (including the non-material nature of the changes or decreases, if any, referred to in Section 4.3.3 below) to the Representatives, from Withum dated, respectively, as of the date of this Agreement and as of the Closing Date and Option Closing Date, if any:
4.3.1 Confirming that they are an independent registered public accounting firm with respect to the Company within the meaning of the Act and the applicable Regulations and that they have not, during the periods covered by the financial statements included in the Registration Statement, Preliminary Prospectus, Sale Preliminary Prospectus and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act;
4.3.2 Stating that in their opinion the financial statements of the Company included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act and the published Regulations thereunder;
4.3.3 Stating that, on the basis of their review, which included a reading of the latest available unaudited interim financial statements of the Company (with an indication of the date of the latest available unaudited interim financial statements), a reading of the latest available minutes of the shareholders and Board of Directors and the various committees of the Board of Directors, consultations with officers and other employees of the Company responsible for financial and accounting matters and other specified procedures and inquiries, nothing has come to their attention that would lead them to believe that (a) the unaudited financial statements of the Company included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the Regulations or are not fairly presented in conformity with GAAP applied on a basis substantially consistent with that of the audited financial statements of the Company included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus; or (b) at a date not later than five (5) days prior to the Effective Date, Closing Date or Option Closing Date, as the case may be, there was any change in the share capital or long-term debt of the Company, or any decrease in the shareholders’ equity of the Company as compared with amounts shown in the most recent balance sheet included in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus, other than as set forth in or contemplated by the Registration Statement, the Sale Preliminary Prospectus and the Prospectus or, if there was any decrease, setting forth the amount of such decrease; and (c) during the period from the most recent balance sheet included in the Registration Statement to a specified date not later than five (5) days prior to the Effective Date, Closing Date or any Option Closing Date, as the case may be, there was any decrease in revenues, net earnings or net earnings per Ordinary Share, in each case as compared with the corresponding period in the preceding year and as compared with the corresponding period in the preceding quarter, other than as set forth in or contemplated by the Registration Statement the Sale Preliminary Prospectus and the Prospectus, or, if there was any such decrease, setting forth the amount of such decrease;
4.3.4 Setting forth, at a date not later than five (5) days prior to the Effective Date, the amount of liabilities of the Company (including a break-down of commercial papers and notes payable to banks);
4.3.5 Stating that they have compared specific dollar amounts, numbers of shares, percentages of revenues and earnings, statements and other financial information pertaining to the Company set forth in the Registration Statement, the Sale Preliminary Prospectus and the Prospectus in each case to the extent that such amounts, numbers, percentages, statements and information may be derived from the general accounting records, including work sheets, of the Company and excluding any questions requiring an interpretation by legal counsel, with the results obtained from the application of specified readings, inquiries and other appropriate procedures (which procedures do not constitute an examination in accordance with generally accepted auditing standards) set forth in the letter and found them to be in agreement;
4.3.6 Stating that they have not, since the Company’s incorporation, brought to the attention of the Company’s management any reportable condition related to internal structure, design or operation as defined in the Statement on Auditing Standards No. 60 “Communication of Internal Control Structure Related Matters Noted in an Audit,” in the Company’s internal controls; and
4.3.7 Statements as to such other matters incident to the transaction contemplated hereby as the Representatives or ML&B may reasonably request, including (i) that Withum is registered with the Public Company Accounting Oversight Board; (ii) that Withum has sufficient assets and insurance to pay for any liability incurred by it relating to providing the letter; and (iii) that Withum is not insolvent.
4.4 Officers’ Certificates.
4.4.1 Officers’ Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representatives shall have received a certificate of the Company signed by the Chairman of the Board or the Chief Executive Officer and the Secretary or Assistant Secretary of the Company, or any similar or equivalent officer of the Company (in their capacities as such), dated the Closing Date or the Option Closing Date, as the case may be, respectively, to the effect that the Company has performed all covenants and complied with all conditions required by this Agreement to be performed or complied with by the Company prior to and as of the Closing Date, or the Option Closing Date, as the case may be, and that the conditions set forth in Section 4 hereof have been satisfied as of such date and that, as of Closing Date and the Option Closing Date, as the case may be, the representations and warranties of the Company set forth in Section 2 hereof are true and correct. In addition, the Representatives will have received such other and further certificates of officers of the Company (in their capacities as such) as the Representatives may reasonably request.
4.4.2 Secretary’s Certificate. At each of the Closing Date and the Option Closing Date, if any, the Representatives shall have received a certificate of the Company signed by the Secretary or Assistant Secretary of the Company, or any similar or equivalent officer of the Company, dated the Closing Date or the Option Closing Date, as the case may be, respectively, certifying (i) that the Charter Documents are true and complete, have not been modified and are in full force and effect; (ii) that the resolutions of the Company’s Board of Directors relating to the public offering contemplated by this Agreement are in full force and effect and have not been modified; (iii) as to the accuracy and completeness of all correspondence between the Company or its counsel and the Commission; (iv) as to the accuracy and completeness of all correspondence between the Company or its counsel and Nasdaq; and (v) as to the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.
4.5 No Material Changes. Prior to and on each of the Closing Date and the Option Closing Date, if any, (i) there shall have been no material adverse change or development involving a prospective material adverse change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement and the Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Insider before or by any court or federal, foreign or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, or financial condition or income of the Company, except as set forth in the Registration Statement and the Prospectus; (iii) no stop order shall have been issued under the Act and no proceedings therefor shall have been initiated or, to the Company’s knowledge, assuming reasonable inquiry, threatened by the Commission; and (iv) the Registration Statement, the Sale Preliminary Prospectus and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Act and the Regulations and shall conform in all material respects to the requirements of the Act and the Regulations, and neither the Registration Statement, the Sale Preliminary Prospectus nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
4.6 Delivery of Agreements. On the Effective Date, the Company shall have delivered to the Representatives executed copies of the Transaction Documents and all of the Insider Letters.
4.7 Warrant Private Placement. On the Closing Date, the Warrant Private Placement shall have been completed in accordance with Section 3.26.
4.8 Good Standing. The Representatives shall have received on and as of (i) the Effective Date, and (ii) the Closing Date or the Option Closing Date, as the case may be, satisfactory evidence of the good standing of the Company in its jurisdiction of organization and its good standing in such other jurisdictions as the Representatives may reasonably request, in each case in writing or any standard form of telecommunication from the appropriate governmental authorities of such jurisdictions.
4.9 Trust Waiver. On the Effective Date, the Company shall have delivered to the Representatives evidence of waivers from all vendors and service providers to all claims on amounts in the Trust Account which are to be distributed to the Company’s shareholders in accordance with the terms of the Trust Agreement, except for the Representatives with respect to the Deferred Underwriting Commission.
5. Indemnification and Contribution.
5.1 Indemnification.
5.1.1 Indemnification of the Underwriters. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates and their respective partners, members, directors, officers, employees and agents, and each person, if any, who controls each Underwriter or any affiliate within the meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, an “Indemnified Person”) as follows:
a. against any and all loss, liability, claim, damage and expense whatsoever, as reasonably incurred, joint or several, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading, or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus, Sale Preliminary Prospectus, any Testing-the-Waters Communication or the Prospectus or, in the event a Business Combination Advisor, in its sole judgment, may be deemed to be an underwriter of any Business Combination Securities, any Business Combination Securities Disclosure Document (or any amendment or supplement to the foregoing), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
b. against any and all loss, liability, claim, damage and expense whatsoever, as reasonably incurred, joint or several, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental authority, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 5.1.4) any such settlement is effected with the written consent of the Company, which consent shall not unreasonably be delayed, conditioned or withheld;
c. against any and all claims, actions, suits, proceedings, damages, liabilities and expenses reasonably incurred by any of them (including the reasonable fees and expenses of counsel), as incurred, that are related to or arise out of any business combination marketing or capital markets advisory activities by any Underwriter on the Company’s behalf in connection with a Business Combination, provided that the Company will not, however, be responsible to an Indemnified Person for any portion of any such claim, action, suit, proceeding, damage, liability or expense that is finally judicially determined by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from the bad faith, gross negligence or willful misconduct of the Indemnified Person seeking such indemnification;
d. against any and all expense whatsoever (including the fees and disbursements of counsel), as reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental authority, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission (whether or not a party), to the extent that any such expense is not paid under (a), (b) or (c) above; and
e. against any and all loss, liability, claim, damage and expense whatsoever, as reasonably incurred, joint or several, arising out of the Company’s failure to provide any of the information and access to persons, properties and documents required to be provided under Section 3.33 hereof;
provided, however, that the foregoing agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made solely in reliance upon and in conformity with the Underwriters’ Information (and, in connection with any Business Combination, similar information provided by or on behalf of the Business Combination Advisors expressly for use in any Business Combination Securities Disclosure Document).
5.1.2 Indemnification of the Company, its Directors and Officers. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, and its directors, each officer of the Company who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 5.1.1, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement, any preliminary prospectus, the Sale Preliminary Prospectus, any Testing-the-Waters Communication or the Prospectus (or any amendment or supplement to the foregoing), in reliance upon and in conformity with the Underwriters’ Information.
5.1.3 Notifications and Other Indemnification Procedures. Any party that proposes to assert the right to be indemnified under this Section 5.1 will, promptly after receipt of notice of commencement of any action against such party in respect of which a claim is to be made against an indemnifying party or parties under this Section 5.1, notify each such indemnifying party of the commencement of such action, enclosing a copy of all papers served, but the omission so to notify such indemnifying party will not relieve the indemnifying party from (i) any liability that it might have to any indemnified party otherwise than under this Section 5.1 and (ii) any liability that it may have to any indemnified party under the foregoing provision of this Section 5.1 unless, and only to the extent that, such omission results in the forfeiture of substantive rights or defenses by the indemnifying party. If any such action is brought against any indemnified party and it notifies the indemnifying party of its commencement, the indemnifying party will be entitled to participate in and, to the extent that it elects by delivering written notice to the indemnified party promptly after receiving notice of the commencement of the action from the indemnified party, jointly with any other indemnifying party similarly notified, to assume the defense of, the action, with counsel reasonably satisfactory to the indemnified party, and after notice from the indemnifying party to the indemnified party of its election to assume the defense, the indemnifying party will not be liable to the indemnified party for any other legal expenses except as provided below and except for the reasonable costs of investigation subsequently incurred by the indemnified party in connection with the defense. The indemnified party will have the right to employ its own counsel in any such action, but the fees, expenses and other charges of such counsel will be at the expense of such indemnified party unless (A) the employment of counsel by the indemnified party has been authorized in writing by the indemnifying party, (B) the indemnified party has reasonably concluded (based on advice of counsel) that there may be legal defenses available to it or other indemnified parties that are different from or in addition to those available to the indemnifying party, (C) a conflict or potential conflict exists (based on advice of counsel to the indemnified party) between the indemnified party and the indemnifying party (in which case the indemnifying party will not have the right to direct the defense of such action on behalf of the indemnified party), or (D) the indemnifying party has not in fact employed counsel to assume the defense of such action or counsel reasonably satisfactory to the indemnified party, in each case, within a reasonable time after receiving notice of the commencement of the action; in each of which cases the reasonable fees, disbursements and other charges of counsel will be at the expense of the indemnifying party or parties. It is understood that the indemnifying party or parties shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements and other charges of more than one separate firm admitted to practice in such jurisdiction (plus local counsel) at any one time for all such indemnified party or parties. All such fees, disbursements and other charges will be reimbursed by the indemnifying party promptly as they are incurred. An indemnifying party will not, in any event, be liable for any settlement of any action or claim effected without its written consent. No indemnifying party shall, without the prior written consent of each indemnified party, settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding relating to the matters contemplated by this Section 5 (whether or not any indemnified party is a party thereto), unless such settlement, compromise or consent (x) includes an express and unconditional release of each indemnified party, in form and substance reasonably satisfactory to such indemnified party, from all liability arising out of such litigation, investigation, proceeding or claim and (y) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
5.1.4 Settlement Without Consent if Failure to Reimburse. If an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for reasonable fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 5.1.1(b) effected without its written consent if (i) such settlement is entered into more than forty-five (45) days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least thirty (30) days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.
5.2 Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in the foregoing paragraphs of Section 5.1 is applicable in accordance with its terms but for any reason is held to be unavailable or insufficient from the Company or the Underwriters, the Company and the Underwriters will contribute to the total losses, claims, liabilities, expenses and damages (including any investigative, legal and other expenses reasonably incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted) to which any indemnified party may be subject in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand. The relative benefits received by the Company on the one hand and the Underwriters on the other hand shall be deemed to be in the same proportion as the total net proceeds from the sale of the Public Securities (before deducting expenses) received by the Company bear to the total compensation received by the Underwriters (before deducting expenses) from the sale of Units on behalf of the Company. If, but only if, the allocation provided by the foregoing sentence is not permitted by applicable law, the allocation of contribution shall be made in such proportion as is appropriate to reflect not only the relative benefits referred to in the foregoing sentence but also the relative fault of the Company, on the one hand, and the Underwriters, on the other hand, with respect to the statements or omission that resulted in such loss, claim, liability, expense or damage, or action in respect thereof, as well as any other relevant equitable considerations with respect to such offering. Such relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 5.2 were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, liability, expense or damage, or action in respect thereof, referred to above in this Section 5.2 shall be deemed to include, for the purpose of this Section 5.2, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim to the extent consistent with Section 5.1.3. Notwithstanding the foregoing provisions of Section 5.1 and this Section 5.2, each Underwriter shall not be required to contribute any amount in excess of the commissions actually received by it under this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 5.2, any person who controls a party to this Agreement within the meaning of the Act, any affiliates of the respective Underwriters and any officers, directors, partners, employees or agents of the Underwriters or their respective affiliates, will have the same rights to contribution as that party, and each director of the Company and each officer of the Company who signed the Registration Statement will have the same rights to contribution as the Company, subject in each case to the provisions hereof. Any party entitled to contribution, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution may be made under this Section 5.2, will notify any such party or parties from whom contribution may be sought, but the omission to so notify will not relieve that party or parties from whom contribution may be sought from any other obligation it or they may have under this Section 5.2 except to the extent that the failure to so notify such other party materially prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except for a settlement entered into pursuant to the last sentence of Section 5.1.3, no party will be liable for contribution with respect to any action or claim settled without its written consent if such consent is required pursuant to Section 5.1.3.
6. Default by an Underwriter.
6.1 Default Not Exceeding 10% of Firm Units. If any Underwriter or Underwriters shall default in its or their obligations to purchase the Firm Units and if the number of the Firm Units with respect to which such default relates does not exceed in the aggregate 10% of the number of Firm Units that all Underwriters have agreed to purchase hereunder, then such Firm Units to which the default relates shall be purchased by the non-defaulting Underwriters in proportion to their respective commitments hereunder.
6.2 Default Exceeding 10% of Firm Units. In the event that the default addressed in Section 6.1 above relates to more than 10% of the Firm Units, the Representatives may, in its discretion, arrange for it or for another party or parties satisfactory to the Company to purchase such Firm Units to which such default relates on the terms contained herein. If within one (1) Business Day after such default relating to more than 10% of the Firm Units the Representatives do not arrange for the purchase of such Firm Units, then the Company shall be entitled to a further period of one (1) Business Day within which to procure another party or parties satisfactory to the Representatives to purchase said Firm Units on such terms. In the event that neither the Representatives nor the Company arrange for the purchase of the Firm Units to which a default relates as provided in this Section 6, this Agreement may be terminated by the Representatives or the Company without liability on the part of the Company (except as provided in Sections 3.10, 5, and 9.3 hereof) or the several Underwriters (except as provided in Section 5 hereof); provided that nothing herein shall relieve a defaulting Underwriter of its liability, if any, to the other several Underwriters and to the Company for damages occasioned by its default hereunder.
6.3 Postponement of Closing Date. In the event that the Firm Units to which the default relates are to be purchased by the non-defaulting Underwriters, or are to be purchased by another party or parties as aforesaid, the Representatives or the Company shall have the right to postpone the Closing Date for a reasonable period, but not in any event exceeding five (5) Business Days, in order to effect whatever changes may thereby be made necessary in the Registration Statement and/or the Prospectus, as the case may be, or in any other documents and arrangements, and the Company agrees to file promptly any amendment to, or to supplement, the Registration Statement and/or the Prospectus, as the case may be, that in the reasonable opinion of counsel for the Underwriters may thereby be made necessary. The term “Underwriter” as used in this Agreement shall include any party substituted under this Section 6 with like effect as if it had originally been a party to this Agreement with respect to such securities.
7. Additional Covenants.
7.1 Additional Shares or Options. The Company hereby agrees that, until the consummation of a Business Combination, it shall not issue any Ordinary Shares or any options or other securities convertible into Ordinary Shares, or any preferred shares or other securities of the Company that participate in any manner in the Trust Account or that vote as a class with the Ordinary Shares on a Business Combination.
7.2 Trust Account Waiver Acknowledgments. The Company hereby agrees that it will use its reasonable best efforts prior to commencing its due diligence investigation of any prospective Target Business or obtaining the services of any vendor to have such Target Business and/or vendor acknowledge in writing whether through a letter of intent, memorandum of understanding or other similar document (and subsequently acknowledges the same in any definitive document replacing any of the foregoing), that (a) it has read the Prospectus and understands that the Company has established the Trust Account, initially in an amount of $[•] (without giving effect to any exercise of the Over-allotment Option) for the benefit of the Public Shareholders and that, except for a portion of the interest earned on the amounts held in the Trust Account, the Company may disburse monies from the Trust Account only (i) to the Public Shareholders in the event they elect to redeem Public Shares in connection with the consummation of a Business Combination, (ii) to the Public Shareholders if the Company fails to consummate a Business Combination within the time period set forth in the Charter Documents, or (iii) to the Company after or concurrently with the consummation of a Business Combination and (b) for and in consideration of the Company (i) agreeing to evaluate such Target Business for purposes of consummating a Business Combination with it or (ii) agreeing to engage the services of the vendor, as the case may be, such Target Business or vendor agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Account (“Claim”) and waives any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Company and will not seek recourse against the Trust Account for any reason whatsoever. The foregoing letters shall substantially be in the form attached hereto as Exhibits A and B, respectively. The Company may forego obtaining such waivers only if the Company shall have received the approval of its Chief Executive Officer and the approving vote of at least a majority of its Board of Directors.
7.3 Insider Letter. The Company shall not take any action or omit to take any action which would cause a breach of the Insider Letter and will not allow any amendments to, or waivers of, such Insider Letter without the prior written consent of the Representatives, which consent shall not be unreasonably delayed, conditioned or withheld by the Representatives.
7.4 Rule 419. The Company agrees that it will use its commercially reasonable efforts to prevent the Company from becoming subject to Rule 419 under the Act prior to the consummation of any Business Combination, including but not limited to using its commercially reasonable efforts to prevent any of the Company’s outstanding securities from being deemed to be a “penny stock” as defined in Rule 3a-51-1 under the Exchange Act during such period.
7.5 Tender Offer Documents, Proxy Materials and Other Information. The Company shall provide to the Representatives or their counsel (if so instructed by the Representatives) with ten(10) copies of all tender offer documents or proxy information and all related material filed with the Commission in connection with a Business Combination concurrently with such filing with the Commission. Documents filed with the Commission pursuant to its EDGAR system shall be deemed to have been provided to the Representatives pursuant to this Section 7.5. In addition, the Company shall furnish any other state in which its initial public offering was registered, such information as may be requested by such state.
7.6 Emerging Growth Company. The Company shall promptly notify the Representatives if the Company ceases to be an Emerging Growth Company at any time prior to the completion of the distribution of the Securities within the meaning of the Act.
7.7 Target Net Assets. The Company agrees that the Target Business that it acquires must have a fair market value equal to at least 80% of the balance in the Trust Account at the time of signing the definitive agreement for the Business Combination with such Target Business (excluding taxes payable). The fair market value of such business must be determined by the Board of Directors of the Company based upon standards generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and book value. If the Board of Directors of the Company is not able to independently determine that the target business meets such fair market value requirement, the Company will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. The Company is not required to obtain an opinion as to the fair market value if the Company’s Board of Directors independently determines that the Target Business does have sufficient fair market value, provided that the Target Business is not affiliated with an Insider.
7.8 Representations and Agreements to Survive Delivery. Except as the context otherwise requires, all representations, warranties and agreements contained in this Agreement shall be deemed to be representations, warranties and agreements as of the Closing Date or the Option Closing Date, if any, and such representations, warranties and agreements of the Underwriters and the Company, including the indemnity agreements contained in Section 5 hereof, shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the Underwriters, the Company or any controlling person, and shall survive termination of this Agreement or the issuance and delivery of the Public Securities to the Underwriters until the earlier of the expiration of any applicable statute of limitations and the seventh (7th) anniversary of the later of the Closing Date or the Option Closing Date, if any, at which time the representations, warranties and agreements shall terminate and be of no further force and effect.
7.9 Charter Documents. The Company shall not take any action or omit to take any action that would cause the Company to be in breach or violation of any of its Charter Documents.
8. Effective Date of This Agreement and Termination Thereof.
8.1 Effective Date. This Agreement shall become effective on the Effective Date at the time the Registration Statement is declared effective by the Commission.
8.2 Termination. The Representatives shall have the right to terminate this Agreement at any time prior to the Closing Date by notice given to the Company, (i) if any domestic or international event or act or occurrence has materially disrupted, or in the Representatives’ opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange (“NYSE”), the NYSE American, The Nasdaq Global Select Market, The Nasdaq Global Market, or The Nasdaq Capital Market or quoted on the OTCBB shall have been suspended, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction; or (iii) if the United States shall have become involved in a new war or an increase in existing major hostilities; or (iv) if a banking moratorium has been declared by a New York State or Federal authority; or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities market; or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity (including, without limitation, a calamity relating to a public health matter or natural disaster) or malicious act which, whether or not such loss shall have been insured, will, in the Representatives’ opinion, make it inadvisable to proceed with the delivery of the Units; or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder; or (viii) if the Representatives shall have become aware after the date hereof of such a material adverse change in the conditions of the Company, or such adverse material change in general market conditions, including without limitation, as a result of terrorist activities or any other calamity (including, without limitation, a calamity relating to a public health matter or natural disaster) or crisis either within or outside the United States after the date hereof, or an increase in any of the foregoing, as in the Representatives’ judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Units or to enforce contracts made by the Underwriters for the sale of the Public Securities.
8.3 Expenses. In the event that this Agreement shall not be carried out for any reason other than solely because of the termination of this Agreement pursuant to Section 6 hereof, within the time specified herein or any extensions thereof pursuant to the terms herein, (i) the obligations of the Company to pay the out of pocket expenses related to the transactions contemplated herein shall be governed by Section 3.10 hereof and (ii) the Company shall reimburse the Representatives for any costs and expenses incurred in connection with enforcing any provisions of this Agreement.
8.4 Indemnification. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall not be in any way affected by such election or termination or failure to carry out the terms of this Agreement or any part hereof.
9. Miscellaneous.
9.1 Notices. All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed, delivered by hand or reputable overnight courier or delivered by facsimile or electronic transmission (with printed confirmation of receipt) and confirmed and shall be deemed given when so mailed, delivered or faxed or if mailed, two days after such mailing.
If to the Representatives:
Cohen & Company Capital Markets,
a division of J.V.B. Financial Group, LLC
3 Columbus Circle, 24th Floor
New York, New York 10019
Attn: General Counsel
Email: gc@cohenandcompany.com
Seaport Global Securities LLC
360 Madison Avenue
22nd Floor
New York, NY 10017
Attn: [_______]
Facsimile: [_______]
Email: [_______]
Copy (which copy shall not constitute notice) to:
Morgan, Lewis & Bockius LLP
1400 Page Mill Road
Palo Alto, California 94304-1124
Attn: Albert Lung, Esq.
Facsimile: (650) 843-4001
Email: albert.lung@morganlewis.com
If to the Company:
Melar Acquisition Corp. I
119 West 23rd Street, Suite 206
New York, New York 10011
Attention: Gautam Ivatury
Email: gautam@almavest.com
Copy (which copy shall not constitute notice) to:
Ellenoff Grossman & Schole LLP
1345 Avenue of the Americas, 11th Floor
New York, New York 10105
Attn: Stuart Neuhauser, Esq.
Email: sneuhauser@egsllp.com
9.2 Headings. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.
9.3 Amendment. This Agreement may only be amended by a written instrument executed by each of the parties hereto.
9.4 Entire Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this Agreement) constitute the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersede all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.
9.5 Binding Effect. This Agreement shall inure solely to the benefit of and shall be binding upon the Representatives, the Underwriters, the Company and the controlling persons, directors, agents, partners, members, employees and officers referred to in Section 5 hereof, and their respective successors, legal representatives and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provisions herein contained. The term “successors and assigns” shall not include a purchaser, in its capacity as such, of securities from the Underwriters.
9.6 Waiver of Immunity. To the extent that the Company may be entitled in any jurisdiction in which judicial proceedings may at any time be commenced hereunder, to claim for itself or its revenues or assets any immunity, including sovereign immunity, from suit, jurisdiction, attachment in aid of execution of a judgment or prior to a judgment, execution of a judgment or any other legal process with respect to its obligations hereunder and to the extent that in any such jurisdiction there may be attributed to the Company such an immunity (whether or not claimed), the Company hereby irrevocably agrees not to claim and irrevocably waives such immunity to the maximum extent permitted by law.
9.7 Submission to Jurisdiction. Each of the Company and the Representatives irrevocably submit to the non-exclusive jurisdiction of any New York State or United States Federal court sitting in the City of New York, Borough of Manhattan, over any suit, action or proceeding arising out of or relating to this Agreement, the Registration Statement, the Sale Preliminary Prospectus and the Prospectus or the offering of the Securities. Each of the Company and the Representatives irrevocably waives, to the fullest extent permitted by law, any objection that they may now or hereafter have to the laying of venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. Any such process or summons to be served upon the Company or the Representatives may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 9.1 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company or the Representatives in any action, proceeding or claim. Each of the Company and the Representatives waives, to the fullest extent permitted by law, any other requirements of or objections to personal jurisdiction with respect thereto. Notwithstanding the foregoing, any action based on this Agreement may be instituted by the Underwriters in any competent court. The Company agrees that the Underwriters shall be entitled to recover all of their reasonable attorneys’ fees and expenses relating to any action or proceeding and/or incurred in connection with the preparation therefor if any of them are the prevailing party in such action or proceeding. EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
9.8 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.
9.9 Execution in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission shall constitute valid and sufficient delivery thereof.
9.10 Waiver. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or construed to be a waiver of any such provision, nor in any way affect the validity of this Agreement or any provision hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.
9.11 No Fiduciary Relationship. The Company acknowledges and agrees that (i) the purchase and sale of the Units pursuant to this Agreement is an arm’s-length commercial transaction pursuant to a contractual relationship between the Company and the Underwriters; (ii) in connection therewith and with the process leading to such transaction, each Underwriter is acting solely as a principal and not the agent or fiduciary of the Company; (iii) the Underwriters have not assumed an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether the Underwriters have advised or are currently advising the Company on other matters) or any other obligation to the Company except the obligations expressly set forth in this Agreement; (iv) in no event do the parties intend that the Underwriters act or be responsible as a fiduciary to the Company, its management, shareholders, creditors or any other person in connection with any activity that the Underwriters may undertake or have undertaken in furtherance of the Offering, either before or after the date hereof; and (v) the Company has consulted its own legal and financial advisors to the extent it deemed appropriate. The Underwriters hereby expressly disclaim any fiduciary or similar obligations to the Company, either in connection with the transactions contemplated by this Agreement or any matters leading up to such transactions, and the Company hereby confirms its understanding and agreement to that effect. The Company agrees that it will not claim that the Underwriters have rendered advisory services of any nature or respect, or owe a fiduciary or similar duty to the Company, in connection with such transaction or the process leading thereto. The Company and the Underwriters agree that they are each responsible for making their own independent judgment with respect to any such transactions, and that any opinions or views expressed by the Underwriters to the Company regarding such transactions, including but not limited to any opinions or views with respect to the price or market for the Company’s securities, do not constitute advice or recommendations to the Company. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any breach or alleged breach of any fiduciary or similar duty to the Company in connection with the transactions contemplated by this Agreement or any matters leading up to such transactions.
[Remainder of page intentionally left blank]
If the foregoing correctly sets forth the understanding between the Representatives and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between us.
MELAR ACQUISITION CORP. I
By: | ||
Name: | [•] | |
Title: | [•] |
Accepted on the date first above written.
COHEN & COMPANY CAPITAL MARKETS,
A DIVISION OF J.V.B. FINANCIAL GROUP, LLC, as a
Representative of the several underwriters
By: | ||
Name: | [•] | |
Title: | [•] |
SEAPORT GLOBAL SECURITIES LLC, as a
Representative of the several underwriters
By: | ||
Name: | [•] | |
Title: | [•] |
[Signature Page to Underwriting Agreement]
SCHEDULE A
MELAR ACQUISITION CORP. I
15,000,000 Units
Underwriters | Number of Firm Units to be Purchased | |||
Cohen & Company Capital Markets | ||||
Seaport Global Securities LLC | ||||
[•] | ||||
Total | 15,000,000 |
SCHEDULE B
[•]
EXHIBIT A
FORM OF TARGET BUSINESS LETTER
MELAR ACQUISITION CORP. I
Ladies and Gentlemen:
Reference is made to the Final Prospectus of Melar Acquisition Corp. I (the “Company”), dated as of [•], 2024 (the “Prospectus”). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus.
We have read the Prospectus and understand that the Company has established the Trust Account, initially in an amount of at least $[•], for the benefit of the Public Shareholders and the Underwriters of the Company’s initial public offering (the “Underwriters”) and that, except for a portion of the interest earned on the amounts held in the Trust Account, the Company may disburse monies from the Trust Account only (i) to the Public Shareholders in the event they elect to redeem their public shares in connection with the consummation of a Business Combination, (ii) to the Public Shareholders if the Company fails to consummate a Business Combination within the required time period set forth in its Amended and Restated Memorandum and Articles of Association as the same may be amended from time to time, or (iii) to the Company after or concurrently with the consummation of a Business Combination.
For and in consideration of the Company agreeing to evaluate the undersigned for purposes of consummating a Business Combination with it, the undersigned hereby agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Account (each, a “Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with the Company and will not seek recourse against the Trust Account for any reason whatsoever.
Print Name of Target Business | |
Authorized Signature of Target Business |
EXHIBIT B
FORM OF VENDOR LETTER
MELAR ACQUISITION CORP. I
Ladies and Gentlemen:
Reference is made to the Final Prospectus of Melar Acquisition Corp. I (the “Company”), dated as of [•], 2024 (the “Prospectus”). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Prospectus.
We have read the Prospectus and understand that the Company has established the Trust Account, initially in an amount of at least $[•] for the benefit of the Public Shareholders and the Underwriters of the Company’s initial public offering (the “Underwriters”) and that, except for a portion of the interest earned on the amounts held in the Trust Account, the Company may disburse monies from the Trust Account only (i) to the Public Shareholders in the event they elect to redeem their public shares in connection with the consummation of a Business Combination, (ii) to the Public Shareholders if the Company fails to consummate a Business Combination within the required time period set forth in its Amended and Restated Memorandum and Articles of Association as the same may be amended from time to time, or (iii) to the Company after or concurrently with the consummation of a Business Combination.
For and in consideration of the Company agreeing to engage the services of the undersigned, the undersigned hereby agrees that it does not have any right, title, interest or claim of any kind in or to any monies in the Trust Account (each, a “Claim”) and hereby waives any Claim it may have in the future as a result of, or arising out of, any services provided to the Company and will not seek recourse against the Trust Account for any reason whatsoever.
Print Name of Vendor | |
Authorized Signature of Vendor |
Exhibit 3.1
Dated 11 March 2024
Companies Act (Revised)
Company Limited by Shares
Melar Acquisition Corp. I
memorandum of association |
1
Companies Act (Revised)
Company Limited by Shares
Memorandum of Association
of
Melar Acquisition Corp. I
1 | The name of the Company is Melar Acquisition Corp. I. |
2 | The Company's registered office will be situated at the office of Ogier Global (Cayman) Limited, 89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands or at such other place in the Cayman Islands as the directors may at any time decide. |
3 | The Company's objects are unrestricted. As provided by section 7(4) of the Companies Act (Revised), the Company has full power and authority to carry out any object not prohibited by any law of the Cayman Islands. |
4 | The Company has unrestricted corporate capacity. Without limitation to the foregoing, as provided by section 27 (2) of the Companies Act (Revised), the Company has and is capable of exercising all the functions of a natural person of full capacity irrespective of any question of corporate benefit. |
5 | Nothing in any of the preceding paragraphs permits the Company to carry on any of the following businesses without being duly licensed, namely: |
(a) | the business of a bank or trust company without being licensed in that behalf under the Banks and Trust Companies Act (Revised); or |
(b) | insurance business from within the Cayman Islands or the business of an insurance manager, agent, sub-agent or broker without being licensed in that behalf under the Insurance Act (Revised);or |
(c) | the business of company management without being licensed in that behalf under the Companies Management Act (Revised). |
6 | Unless licensed to do so, the Company will not trade in the Cayman Islands with any person, firm or corporation except in furtherance of its business carried on outside the Cayman Islands. Despite this, the Company may effect and conclude contracts in the Cayman Islands and exercise in the Cayman Islands any of its powers necessary for the carrying on of its business outside the Cayman Islands. |
7 | The Company is a company limited by shares and accordingly the liability of each member is limited to the amount (if any) unpaid on that member's shares. |
2
8 | The share capital of the Company is USD55,500 divided into 500,000,000 Class A ordinary shares of par value USD0.0001 each, 50,000,000 Class B ordinary shares of par value USD0.0001 each and 5,000,000 preference shares of par value USD0.0001 each. However, subject to the Companies Act (Revised) and the Company's articles of association, the Company has power to do any one or more of the following: |
(a) | to redeem or repurchase any of its shares; and |
(b) | to increase or reduce its capital; and |
(c) | to issue any part of its capital (whether original, redeemed, increased or reduced): |
(i) | with or without any preferential, deferred, qualified or special rights, privileges or conditions; or |
(ii) | subject to any limitations or restrictions |
and unless the condition of issue expressly declares otherwise, every issue of shares (whether declared to be ordinary, preference or otherwise) is subject to this power; or
(d) | to alter any of those rights, privileges, conditions, limitations or restrictions. |
9 | The Company has power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands. |
3
We, the subscriber to this memorandum of association, wish to be formed into a company pursuant to this memorandum; and we agree to take the number of shares in the capital of the Company shown opposite our name in the table below.
Dated 11 March 2024
Name and address of Subscriber | Number of shares taken | Signature |
Ogier Global Subscriber (Cayman) Limited 89 Nexus Way Camana Bay Grand Cayman, KY1-9009 Cayman Islands |
1 Class B ordinary share of par value US$0.0001 |
per: _________________________ Name: Authorised Signatory |
Witness to above signature |
_______________________________ Name:
Ogier Global (Cayman) Limited 89 Nexus Way Camana Bay Grand Cayman, KY1-9009 Cayman Islands
Occupation: Administrator |
4
Dated 11 March 2024
Companies Act (Revised)
Company Limited by Shares
Melar Acquisition Corp. I
ARTICLES of association |
CONTENTS
1 | Definitions, interpretation and exclusion of Table A | 1 | |
Definitions | 1 | ||
Interpretation | 3 | ||
Exclusion of Table A Articles | 4 | ||
2 | Shares | 4 | |
Power to issue Shares and options, with or without special rights | 4 | ||
Power to issue fractions of a Share | 4 | ||
Power to pay commissions and brokerage fees | 4 | ||
Trusts not recognised | 5 | ||
Power to vary class rights | 5 | ||
Effect of new Share issue on existing class rights | 5 | ||
Capital contributions without issue of further Shares | 6 | ||
No bearer Shares or warrants | 6 | ||
Treasury Shares | 6 | ||
Rights attaching to Treasury Shares and related matters | 6 | ||
3 | Share certificates | 7 | |
Issue of share certificates | 7 | ||
Renewal of lost or damaged share certificates | 7 | ||
4 | Lien on Shares | 8 | |
Nature and scope of lien | 8 | ||
Company may sell Shares to satisfy lien | 8 | ||
Authority to execute instrument of transfer | 8 | ||
Consequences of sale of Shares to satisfy lien | 9 | ||
Application of proceeds of sale | 9 | ||
5 | Calls on Shares and forfeiture | 9 | |
Power to make calls and effect of calls | 9 | ||
Time when call made | 10 | ||
Liability of joint holders | 10 | ||
Interest on unpaid calls | 10 | ||
Deemed calls | 10 | ||
Power to accept early payment | 10 | ||
Power to make different arrangements at time of issue of Shares | 11 | ||
Notice of default | 11 | ||
Forfeiture or surrender of Shares | 11 | ||
Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender | 11 | ||
Effect of forfeiture or surrender on former Member | 12 | ||
Evidence of forfeiture or surrender | 12 | ||
Sale of forfeited or surrendered Shares | 12 |
6 | Transfer of Shares | 13 | |
Form of transfer | 13 | ||
Power to refuse registration | 13 | ||
Notice of refusal to register | 13 | ||
Power to suspend registration | 13 | ||
Fee, if any, payable for registration | 13 | ||
Company may retain instrument of transfer | 13 | ||
7 | Transmission of Shares | 14 | |
Persons entitled on death of a Member | 14 | ||
Registration of transfer of a Share following death or bankruptcy | 14 | ||
Indemnity | 14 | ||
Rights of person entitled to a Share following death or bankruptcy | 14 | ||
8 | Alteration of capital | 15 | |
Increasing, consolidating, converting, dividing and cancelling share capital | 15 | ||
Dealing with fractions resulting from consolidation of Shares | 15 | ||
Reducing share capital | 16 | ||
9 | Redemption and purchase of own Shares | 16 | |
Power to issue redeemable Shares and to purchase own Shares | 16 | ||
Repurchase of subscriber Share | 16 | ||
Power to pay for redemption or purchase in cash or in specie | 17 | ||
Effect of redemption or purchase of a Share | 17 | ||
10 | Meetings of Members | 17 | |
Power to call meetings | 17 | ||
Content of notice | 18 | ||
Period of notice | 18 | ||
Persons entitled to receive notice | 19 | ||
Publication of notice on a website | 19 | ||
Time a website notice is deemed to be given | 19 | ||
Required duration of publication on a website | 19 | ||
Accidental omission to give notice or non-receipt of notice | 20 | ||
11 | Proceedings at meetings of Members | 20 | |
Quorum | 20 | ||
Lack of quorum | 20 | ||
Use of technology | 20 | ||
Chairman | 21 | ||
Right of a director to attend and speak | 21 | ||
Adjournment | 21 | ||
Method of voting | 21 | ||
Outcome of vote by show of hands | 21 | ||
Withdrawal of demand for a poll | 22 | ||
Taking of a poll | 22 | ||
Chairman's casting vote | 22 | ||
Amendments to resolutions | 22 | ||
Written resolutions | 23 | ||
Sole-member company | 24 |
12 | Voting rights of Members | 24 | |
Right to vote | 24 | ||
Rights of joint holders | 24 | ||
Representation of corporate Members | 24 | ||
Member with mental disorder | 25 | ||
Objections to admissibility of votes | 25 | ||
Form of proxy | 25 | ||
How and when proxy is to be delivered | 26 | ||
Voting by proxy | 27 | ||
13 | Number of directors | 27 | |
14 | Appointment, disqualification and removal of directors | 27 | |
First directors | 27 | ||
No age limit | 27 | ||
Corporate directors | 27 | ||
No shareholding qualification | 28 | ||
Appointment of directors | 28 | ||
Removal of directors | 28 | ||
Resignation of directors | 29 | ||
Termination of the office of director | 29 | ||
15 | Alternate directors | 29 | |
Appointment and removal | 29 | ||
Notices | 30 | ||
Rights of alternate director | 30 | ||
Appointment ceases when the appointor ceases to be a director | 31 | ||
Status of alternate director | 31 | ||
Status of the director making the appointment | 31 | ||
16 | Powers of directors | 31 | |
Powers of directors | 31 | ||
Appointments to office | 32 | ||
Remuneration | 32 | ||
Disclosure of information | 33 | ||
17 | Delegation of powers | 33 | |
Power to delegate any of the directors' powers to a committee | 33 | ||
Power to appoint an agent of the Company | 34 | ||
Power to appoint an attorney or authorised signatory of the Company | 34 | ||
Power to appoint a proxy | 34 |
18 | Meetings of directors | 35 | |
Regulation of directors' meetings | 35 | ||
Calling meetings | 35 | ||
Notice of meetings | 35 | ||
Period of notice | 35 | ||
Use of technology | 35 | ||
Place of meetings | 35 | ||
Quorum | 35 | ||
Voting | 35 | ||
Validity | 36 | ||
Recording of dissent | 36 | ||
Written resolutions | 36 | ||
Sole director's minute | 36 | ||
19 | Permissible directors' interests and disclosure | 37 | |
Permissible interests subject to disclosure | 37 | ||
Notification of interests | 37 | ||
Voting where a director is interested in a matter | 38 | ||
20 | Minutes | 38 | |
21 | Accounts and audit | 38 | |
Accounting and other records | 38 | ||
No automatic right of inspection | 38 | ||
Sending of accounts and reports | 38 | ||
Time of receipt if documents are published on a website | 39 | ||
Validity despite accidental error in publication on website | 39 | ||
When accounts are to be audited | 39 | ||
22 | Financial year | 40 | |
23 | Record dates | 40 | |
24 | Dividends | 40 | |
Declaration of dividends by Members | 40 | ||
Payment of interim dividends and declaration of final dividends by directors | 40 | ||
Apportionment of dividends | 41 | ||
Right of set off | 41 | ||
Power to pay other than in cash | 41 | ||
How payments may be made | 42 | ||
Dividends or other moneys not to bear interest in absence of special rights | 42 | ||
Dividends unable to be paid or unclaimed | 42 | ||
25 | Capitalisation of profits | 43 | |
Capitalisation of profits or of any share premium account or capital redemption reserve | 43 | ||
Applying an amount for the benefit of members | 43 |
26 | Share premium account | 44 | |
Directors to maintain share premium account | 44 | ||
Debits to share premium account | 44 | ||
27 | Seal | 44 | |
Company seal | 44 | ||
Duplicate seal | 44 | ||
When and how seal is to be used | 44 | ||
If no seal is adopted or used | 45 | ||
Power to allow non-manual signatures and facsimile printing of seal | 45 | ||
Validity of execution | 45 | ||
28 | Indemnity | 45 | |
Indemnity | 45 | ||
Release | 46 | ||
Insurance | 46 | ||
29 | Notices | 47 | |
Form of notices | 47 | ||
Electronic communications | 47 | ||
Persons authorised to give notices | 47 | ||
Delivery of written notices | 48 | ||
Joint holders | 48 | ||
Signatures | 48 | ||
Evidence of transmission | 48 | ||
Giving notice to a deceased or bankrupt Member | 48 | ||
Date of giving notices | 48 | ||
Saving provision | 49 | ||
30 | Authentication of Electronic Records | 49 | |
Application of Articles | 49 | ||
Authentication of documents sent by Members by Electronic means | 50 | ||
Authentication of document sent by the Secretary or Officers of the Company by Electronic means | 50 | ||
Manner of signing | 51 | ||
Saving provision | 51 | ||
31 | Transfer by way of continuation | 51 | |
32 | Winding up | 52 | |
Distribution of assets in specie | 52 | ||
No obligation to accept liability | 52 | ||
The directors are authorised to present a winding up petition | 52 | ||
33 | Amendment of Memorandum and Articles | 52 | |
Power to change name or amend Memorandum | 52 | ||
Power to amend these Articles | 52 |
Companies Act (Revised)
Company Limited by Shares
Articles of Association
of
Melar Acquisition Corp. I
1 | Definitions, interpretation and exclusion of Table A |
Definitions
1.1 | In these Articles, the following definitions apply: |
Act means the Companies Act (Revised).
Articles means, as appropriate:
(a) | these Articles of Association as amended from time to time: or |
(b) | two or more particular Articles of these Articles; |
and Article refers to a particular Article of these Articles.
Business Day means a day other than a public holiday in the place where the Company's registered office is located, a Saturday or a Sunday.
Clear Days, in relation to a period of notice, means that period excluding:
(a) | the day when the notice is given or deemed to be given; and |
(b) | the day for which it is given or on which it is to take effect. |
Company means the above-named company.
Default Rate means 10% (ten per cent) per annum.
Electronic has the meaning given to that term in the Electronic Transactions Act (Revised).
Electronic Record has the meaning given to that term in the Electronic Transactions Act (Revised).
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Electronic Signature has the meaning given to that term in the Electronic Transactions Act (Revised).
Fully Paid and Paid Up:
(a) | in relation to a Share with par value, means that the par value for that Share and any premium payable in respect of the issue of that Share, has been fully paid or credited as paid in money or money's worth; |
(b) | in relation to a Share without par value, means that the agreed issue price for that Share has been fully paid or credited as paid in money or money's worth. |
Islands means the British Overseas Territory of the Cayman Islands.
Member means any person or persons entered on the register of members from time to time as the holder of a Share.
Memorandum means the Memorandum of Association of the Company as amended from time to time.
Officer means a person appointed to hold an office in the Company; and the expression includes a director, alternate director or liquidator, but does not include the Secretary.
Ordinary Resolution means a resolution of a duly constituted general meeting of the Company passed by a simple majority of the votes cast by, or on behalf of, the Members entitled to vote. The expression also includes a unanimous written resolution.
Secretary means a person appointed to perform the duties of the secretary of the Company, including a joint, assistant or deputy secretary.
Share means a share in the share capital of the Company; and the expression:
(a) | includes stock (except where a distinction between shares and stock is expressed or implied); and |
(b) | where the context permits, also includes a fraction of a share. |
Special Resolution has the meaning given to that term in the Act; and the expression includes a unanimous written resolution.
Treasury Shares means Shares of the Company held in treasury pursuant to the Act and Article 2.12.
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Interpretation
1.2 | In the interpretation of these Articles, the following provisions apply unless the context otherwise requires: |
(a) | A reference in these Articles to a statute is a reference to a statute of the Islands as known by its short title, and includes: |
(i) | any statutory modification, amendment or re-enactment; and |
(ii) | any subordinate legislation or regulations issued under that statute. |
Without limitation to the preceding sentence, a reference to a revised Act of the Cayman Islands is taken to be a reference to the revision of that Act in force from time to time as amended from time to time.
(b) | Headings are inserted for convenience only and do not affect the interpretation of these Articles, unless there is ambiguity. |
(c) | If a day on which any act, matter or thing is to be done under these Articles is not a Business Day, the act, matter or thing must be done on the next Business Day. |
(d) | A word which denotes the singular also denotes the plural, a word which denotes the plural also denotes the singular, and a reference to any gender also denotes the other genders. |
(e) | A reference to a person includes, as appropriate, a company, trust, partnership, joint venture, association, body corporate or government agency. |
(f) | Where a word or phrase is given a defined meaning another part of speech or grammatical form in respect to that word or phrase has a corresponding meaning. |
(g) | All references to time are to be calculated by reference to time in the place where the Company's registered office is located. |
(h) | The words written and in writing include all modes of representing or reproducing words in a visible form, but do not include an Electronic Record where the distinction between a document in writing and an Electronic Record is expressed or implied. |
(i) | The words including, include and in particular or any similar expression are to be construed without limitation. |
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Exclusion of Table A Articles
1.3 | The regulations contained in Table A in the First Schedule of the Act and any other regulations contained in any statute or subordinate legislation are expressly excluded and do not apply to the Company. |
2 | Shares |
Power to issue Shares and options, with or without special rights
2.1 | Subject to the provisions of the Act and the Articles about the redemption and purchase of the Company's own Shares, the directors have general and unconditional authority to allot (with or without confirming rights of renunciation), grant options over or otherwise deal with any unissued Shares of the Company to such persons, at such times and on such terms and conditions as they may decide. No Share may be issued at a discount except in accordance with the provisions of the Act. |
2.2 | Without limitation to the preceding Article, the directors may so deal with the unissued Shares of the Company: |
(a) | either at a premium or at par; |
(b) | with or without preferred, deferred or other special rights or restrictions whether in regard to dividend, voting, return of capital or otherwise. |
Power to issue fractions of a Share
2.3 | Subject to the Act, the Company may issue fractions of a Share of any class. A fraction of a Share shall be subject to and carry the corresponding fraction of liabilities (whether with respect to calls or otherwise), limitations, preferences, privileges, qualifications, restrictions, rights and other attributes of a Share of that class of Shares. |
Power to pay commissions and brokerage fees
2.4 | The Company may pay a commission to any person in consideration of that person: |
(a) | subscribing or agreeing to subscribe, whether absolutely or conditionally; or |
(b) | procuring or agreeing to procure subscriptions, whether absolute or conditional |
for any Shares in the Company. That commission may be satisfied by the payment of cash or the allotment of Fully Paid or partly-paid Shares or partly in one way and partly in another.
2.5 | The Company may employ a broker in the issue of its capital and pay him any proper commission or brokerage. |
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Trusts not recognised
2.6 | Except as required by law: |
(a) | no person shall be recognised by the Company as holding any Share on any trust; and |
(b) | no person other than the Member shall be recognised by the Company as having any right in a Share. |
Power to vary class rights
2.7 | If the share capital is divided into different classes of Shares then, unless the terms on which a class of Shares was issued state otherwise, the rights attaching to a class of Shares may only be varied if one of the following applies: |
(a) | the Members holding two thirds of the issued Shares of that class consent in writing to the variation; or |
(b) | the variation is made with the sanction of a Special Resolution passed at a separate general meeting of the Members holding the issued Shares of that class. |
2.8 | For the purpose of paragraph (b) of the preceding Article, all the provisions of these Articles relating to general meetings apply, mutatis mutandis, to every such separate meeting except that: |
(a) | the necessary quorum shall be one or more persons holding, or representing by proxy, not less than one third of the issued Shares of the class; and |
(b) | any Member holding issued Shares of the class, present in person or by proxy or, in the case of a corporate Member, by its duly authorised representative, may demand a poll. |
Effect of new Share issue on existing class rights
2.9 | Unless the terms on which a class of Shares was issued state otherwise, the rights conferred on the Member holding Shares of any class shall not be deemed to be varied by the creation or issue of further Shares ranking pari passu with the existing Shares of that class. |
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Capital contributions without issue of further Shares
2.10 | With the consent of a Member, the directors may accept a voluntary contribution to the capital of the Company from that Member without issuing Shares in consideration for that contribution. In that event, the contribution shall be dealt with in the following manner: |
(a) | It shall be treated as if it were a share premium. |
(b) | Unless the Member agrees otherwise: |
(i) | if the Member holds Shares in a single class of Shares - it shall be credited to the share premium account for that class of Shares; |
(ii) | if the Member holds Shares of more than one class - it shall be credited rateably to the share premium accounts for those classes of Shares (in the proportion that the sum of the issue prices for each class of Shares that the Member holds bears to the total issue prices for all classes of Shares that the Member holds). |
(c) | It shall be subject to the provisions of the Act and these Articles applicable to share premiums. |
No bearer Shares or warrants
2.11 | The Company shall not issue Shares or warrants to bearers. |
Treasury Shares
2.12 | Shares that the Company purchases, redeems or acquires by way of surrender in accordance with the Act shall be held as Treasury Shares and not treated as cancelled if: |
(a) | the directors so determine prior to the purchase, redemption or surrender of those shares; and |
(b) | the relevant provisions of the Memorandum and Articles and the Act are otherwise complied with. |
Rights attaching to Treasury Shares and related matters
2.13 | No dividend may be declared or paid, and no other distribution (whether in cash or otherwise) of the Company's assets (including any distribution of assets to members on a winding up) may be made to the Company in respect of a Treasury Share. |
2.14 | The Company shall be entered in the Register as the holder of the Treasury Shares. However: |
(a) | the Company shall not be treated as a member for any purpose and shall not exercise any right in respect of the Treasury Shares, and any purported exercise of such a right shall be void; |
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(b) | a Treasury Share shall not be voted, directly or indirectly, at any meeting of the Company and shall not be counted in determining the total number of issued shares at any given time, whether for the purposes of these Articles or the Act. |
2.15 | Nothing in the preceding Article prevents an allotment of Shares as fully paid bonus shares in respect of a Treasury Share and Shares allotted as fully paid bonus shares in respect of a Treasury Share shall be treated as Treasury Shares. |
2.16 | Treasury Shares may be disposed of by the Company in accordance with the Act and otherwise on such terms and conditions as the directors determine. |
3 | Share certificates |
Issue of share certificates
3.1 | Upon being entered in the register of members as the holder of a Share, a Member shall be entitled: |
(a) | without payment, to one certificate for all the Shares of each class held by that Member (and, upon transferring a part of the Member's holding of Shares of any class, to a certificate for the balance of that holding); and |
(b) | upon payment of such reasonable sum as the directors may determine for every certificate after the first, to several certificates each for one or more of that Member's Shares. |
3.2 | Every certificate shall specify the number, class and distinguishing numbers (if any) of the Shares to which it relates and whether they are Fully Paid or partly paid up. A certificate may be executed under seal or executed in such other manner as the directors determine. |
3.3 | The Company shall not be bound to issue more than one certificate for Shares held jointly by several persons and delivery of a certificate for a Share to one joint holder shall be a sufficient delivery to all of them. |
Renewal of lost or damaged share certificates
3.4 | If a share certificate is defaced, worn-out, lost or destroyed, it may be renewed on such terms (if any) as to: |
(a) | evidence; |
(b) | indemnity; |
(c) | payment of the expenses reasonably incurred by the Company in investigating the evidence; and |
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(d) | payment of a reasonable fee, if any, for issuing a replacement share certificate |
as the directors may determine, and (in the case of defacement or wearing-out) on delivery to the Company of the old certificate.
4 | Lien on Shares |
Nature and scope of lien
4.1 | The Company has a first and paramount lien on all Shares (whether Fully Paid or not) registered in the name of a Member (whether solely or jointly with others). The lien is for all moneys payable to the Company by the Member or the Member's estate: |
(a) | either alone or jointly with any other person, whether or not that other person is a Member; and |
(b) | whether or not those moneys are presently payable. |
4.2 | At any time the directors may declare any Share to be wholly or partly exempt from the provisions of this Article. |
Company may sell Shares to satisfy lien
4.3 | The Company may sell any Shares over which it has a lien if all of the following conditions are met: |
(a) | the sum in respect of which the lien exists is presently payable; |
(b) | the Company gives notice to the Member holding the Share (or to the person entitled to it in consequence of the death or bankruptcy of that Member) demanding payment and stating that if the notice is not complied with the Shares may be sold; and |
(c) | that sum is not paid within 14 Clear Days after that notice is deemed to be given under these Articles. |
4.4 | The Shares may be sold in such manner as the directors determine. |
4.5 | To the maximum extent permitted by law, the directors shall incur no personal liability to the Member concerned in respect of the sale. |
Authority to execute instrument of transfer
4.6 | To give effect to a sale, the directors may authorise any person to execute an instrument of transfer of the Shares sold to, or in accordance with the directions of, the purchaser. The title of the transferee of the Shares shall not be affected by any irregularity or invalidity in the proceedings in respect of the sale. |
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Consequences of sale of Shares to satisfy lien
4.7 | On sale pursuant to the preceding Articles: |
(a) | the name of the Member concerned shall be removed from the register of members as the holder of those Shares; and |
(b) | that person shall deliver to the Company for cancellation the certificate for those Shares. |
Despite this, that person shall remain liable to the Company for all monies which, at the date of sale, were presently payable by him to the Company in respect of those Shares. That person shall also be liable to pay interest on those monies from the date of sale until payment at the rate at which interest was payable before that sale or, failing that, at the Default Rate. The directors may waive payment wholly or in part or enforce payment without any allowance for the value of the Shares at the time of sale or for any consideration received on their disposal.
Application of proceeds of sale
4.8 | The net proceeds of the sale, after payment of the costs, shall be applied in payment of so much of the sum for which the lien exists as is presently payable. Any residue shall be paid to the person whose Shares have been sold: |
(a) | if no certificate for the Shares was issued, at the date of the sale; or |
(b) | if a certificate for the Shares was issued, upon surrender to the Company of that certificate for cancellation |
but, in either case, subject to the Company retaining a like lien for all sums not presently payable as existed on the Shares before the sale.
5 | Calls on Shares and forfeiture |
Power to make calls and effect of calls
5.1 | Subject to the terms of allotment, the directors may make calls on the Members in respect of any moneys unpaid on their Shares including any premium. The call may provide for payment to be by instalments. Subject to receiving at least 14 Clear Days' notice specifying when and where payment is to be made, each Member shall pay to the Company the amount called on his Shares as required by the notice. |
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5.2 | Before receipt by the Company of any sum due under a call, that call may be revoked in whole or in part and payment of a call may be postponed in whole or in part. Where a call is to be paid in instalments, the Company may revoke the call in respect of all or any remaining instalments in whole or in part and may postpone payment of all or any of the remaining instalments in whole or in part. |
5.3 | A Member on whom a call is made shall remain liable for that call notwithstanding the subsequent transfer of the Shares in respect of which the call was made. He shall not be liable for calls made after he is no longer registered as Member in respect of those Shares. |
Time when call made
5.4 | A call shall be deemed to have been made at the time when the resolution of the directors authorising the call was passed. |
Liability of joint holders
5.5 | Members registered as the joint holders of a Share shall be jointly and severally liable to pay all calls in respect of the Share. |
Interest on unpaid calls
5.6 | If a call remains unpaid after it has become due and payable the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid: |
(a) | at the rate fixed by the terms of allotment of the Share or in the notice of the call; or |
(b) | if no rate is fixed, at the Default Rate. |
The directors may waive payment of the interest wholly or in part.
Deemed calls
5.7 | Any amount payable in respect of a Share, whether on allotment or on a fixed date or otherwise, shall be deemed to be payable as a call. If the amount is not paid when due the provisions of these Articles shall apply as if the amount had become due and payable by virtue of a call. |
Power to accept early payment
5.8 | The Company may accept from a Member the whole or a part of the amount remaining unpaid on Shares held by him although no part of that amount has been called up. |
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Power to make different arrangements at time of issue of Shares
5.9 | Subject to the terms of allotment, the directors may make arrangements on the issue of Shares to distinguish between Members in the amounts and times of payment of calls on their Shares. |
Notice of default
5.10 | If a call remains unpaid after it has become due and payable the directors may give to the person from whom it is due not less than 14 Clear Days' notice requiring payment of: |
(a) | the amount unpaid; |
(b) | any interest which may have accrued; |
(c) | any expenses which have been incurred by the Company due to that person's default. |
5.11 | The notice shall state the following: |
(a) | the place where payment is to be made; and |
(b) | a warning that if the notice is not complied with the Shares in respect of which the call is made will be liable to be forfeited. |
Forfeiture or surrender of Shares
5.12 | If the notice under the preceding Article is not complied with, the directors may, before the payment required by the notice has been received, resolve that any Share the subject of that notice be forfeited. The forfeiture shall include all dividends or other moneys payable in respect of the forfeited Share and not paid before the forfeiture. Despite the foregoing, the directors may determine that any Share the subject of that notice be accepted by the Company as surrendered by the Member holding that Share in lieu of forfeiture. |
Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender
5.13 | A forfeited or surrendered Share may be sold, re-allotted or otherwise disposed of on such terms and in such manner as the directors determine either to the former Member who held that Share or to any other person. The forfeiture or surrender may be cancelled on such terms as the directors think fit at any time before a sale, re-allotment or other disposition. Where, for the purposes of its disposal, a forfeited or surrendered Share is to be transferred to any person, the directors may authorise some person to execute an instrument of transfer of the Share to the transferee. |
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Effect of forfeiture or surrender on former Member
5.14 | On forfeiture or surrender: |
(a) | the name of the Member concerned shall be removed from the register of members as the holder of those Shares and that person shall cease to be a Member in respect of those Shares; and |
(b) | that person shall surrender to the Company for cancellation the certificate (if any) for the forfeited or surrendered Shares. |
5.15 | Despite the forfeiture or surrender of his Shares, that person shall remain liable to the Company for all moneys which at the date of forfeiture or surrender were presently payable by him to the Company in respect of those Shares together with: |
(a) | all expenses; and |
(b) | interest from the date of forfeiture or surrender until payment: |
(i) | at the rate of which interest was payable on those moneys before forfeiture; or |
(ii) | if no interest was so payable, at the Default Rate. |
The directors, however, may waive payment wholly or in part.
Evidence of forfeiture or surrender
5.16 | A declaration, whether statutory or under oath, made by a director or the Secretary shall be conclusive evidence of the following matters stated in it as against all persons claiming to be entitled to forfeited Shares: |
(a) | that the person making the declaration is a director or Secretary of the Company, and |
(b) | that the particular Shares have been forfeited or surrendered on a particular date. |
Subject to the execution of an instrument of transfer, if necessary, the declaration shall constitute good title to the Shares.
Sale of forfeited or surrendered Shares
5.17 | Any person to whom the forfeited or surrendered Shares are disposed of shall not be bound to see to the application of the consideration, if any, of those Shares nor shall his title to the Shares be affected by any irregularity in, or invalidity of the proceedings in respect of, the forfeiture, surrender or disposal of those Shares. |
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6 | Transfer of Shares |
Form of transfer
6.1 | Subject to the following Articles about the transfer of Shares, a Member may transfer Shares to another person by completing an instrument of transfer, in a common form or in a form approved by the directors, executed: |
(a) | where the Shares are Fully Paid, by or on behalf of that Member; and |
(b) | where the Shares are partly paid, by or on behalf of that Member and the transferee. |
Power to refuse registration
6.2 | The directors may refuse to register the transfer of a Share to any person. They may do so in their absolute discretion, without giving any reason for their refusal, and irrespective of whether the Share is Fully Paid or the Company has no lien over it. |
Notice of refusal to register
6.3 | If the directors refuse to register a transfer of a Share, they must send notice of their refusal to the existing Member within two months after the date on which the transfer was lodged with the Company. |
Power to suspend registration
6.4 | The directors may suspend registration of the transfer of Shares at such times and for such periods, not exceeding 30 days in any calendar year, as they determine. |
Fee, if any, payable for registration
6.5 | If the directors so decide, the Company may charge a reasonable fee for the registration of any instrument of transfer or other document relating to the title to a Share. |
Company may retain instrument of transfer
6.6 | The Company shall be entitled to retain any instrument of transfer which is registered; but an instrument of transfer which the directors refuse to register shall be returned to the person lodging it when notice of the refusal is given. |
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7 | Transmission of Shares |
Persons entitled on death of a Member
7.1 | If a Member dies, the only persons recognised by the Company as having any title to the deceased Members' interest are the following: |
(a) | where the deceased Member was a joint holder, the survivor or survivors; and |
(b) | where the deceased Member was a sole holder, that Member's personal representative or representatives. |
7.2 | Nothing in these Articles shall release the deceased Member's estate from any liability in respect of any Share, whether the deceased was a sole holder or a joint holder. |
Registration of transfer of a Share following death or bankruptcy
7.3 | A person becoming entitled to a Share in consequence of the death or bankruptcy of a Member may elect to do either of the following: |
(a) | to become the holder of the Share; or |
(b) | to transfer the Share to another person. |
7.4 | That person must produce such evidence of his entitlement as the directors may properly require. |
7.5 | If the person elects to become the holder of the Share, he must give notice to the Company to that effect. For the purposes of these Articles, that notice shall be treated as though it were an executed instrument of transfer. |
7.6 | If the person elects to transfer the Share to another person then: |
(a) | if the Share is Fully Paid, the transferor must execute an instrument of transfer; and |
(b) | if the Share is partly paid, the transferor and the transferee must execute an instrument of transfer. |
7.7 | All the Articles relating to the transfer of Shares shall apply to the notice or, as appropriate, the instrument of transfer. |
Indemnity
7.8 | A person registered as a Member by reason of the death or bankruptcy of another Member shall indemnify the Company and the directors against any loss or damage suffered by the Company or the directors as a result of that registration. |
Rights of person entitled to a Share following death or bankruptcy
7.9 | A person becoming entitled to a Share by reason of the death or bankruptcy of a Member shall have the rights to which he would be entitled if he were registered as the holder of the Share. But, until he is registered as Member in respect of the Share, he shall not be entitled to attend or vote at any meeting of the Company or at any separate meeting of the holders of that class of Shares in the Company. |
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8 | Alteration of capital |
Increasing, consolidating, converting, dividing and cancelling share capital
8.1 | To the fullest extent permitted by the Act, the Company may by Ordinary Resolution do any of the following and amend its Memorandum for that purpose: |
(a) | increase its share capital by new Shares of the amount fixed by that Ordinary Resolution and with the attached rights, priorities and privileges set out in that Ordinary Resolution; |
(b) | consolidate and divide all or any of its share capital into Shares of larger amount than its existing Shares; |
(c) | convert all or any of its Paid Up Shares into stock, and reconvert that stock into Paid Up Shares of any denomination; |
(d) | sub-divide its Shares or any of them into Shares of an amount smaller than that fixed by the Memorandum, so, however, that in the sub-division, the proportion between the amount paid and the amount, if any, unpaid on each reduced Share shall be the same as it was in case of the Share from which the reduced Share is derived; and |
(e) | cancel Shares which, at the date of the passing of that Ordinary Resolution, have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the Shares so cancelled or, in the case of Shares without nominal par value, diminish the number of Shares into which its capital is divided. |
Dealing with fractions resulting from consolidation of Shares
8.2 | Whenever, as a result of a consolidation of Shares, any Members would become entitled to fractions of a Share the directors may on behalf of those Members: |
(a) | sell the Shares representing the fractions for the best price reasonably obtainable to any person (including, subject to the provisions of the Act, the Company); and |
(b) | distribute the net proceeds in due proportion among those Members. |
For that purpose, the directors may authorise some person to execute an instrument of transfer of the Shares to, or in accordance with the directions of, the purchaser. The transferee shall not be bound to see to the application of the purchase money nor shall the transferee's title to the Shares be affected by any irregularity in, or invalidity of, the proceedings in respect of the sale.
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Reducing share capital
8.3 | Subject to the Act and to any rights for the time being conferred on the Members holding a particular class of Shares, the Company may, by Special Resolution, reduce its share capital in any way. |
9 | Redemption and purchase of own Shares |
Power to issue redeemable Shares and to purchase own Shares
9.1 | Subject to the Act, and to any rights for the time being conferred on the Members holding a particular class of Shares, the Company may by its directors: |
(a) | issue Shares that are to be redeemed or liable to be redeemed, at the option of the Company or the Member holding those redeemable Shares, on the terms and in the manner its directors determine before the issue of those Shares; |
(b) | with the consent by Special Resolution of the Members holding Shares of a particular class, vary the rights attaching to that class of Shares so as to provide that those Shares are to be redeemed or are liable to be redeemed at the option of the Company on the terms and in the manner which the directors determine at the time of such variation; and |
(c) | purchase all or any of its own Shares of any class including any redeemable Shares on the terms and in the manner which the directors determine at the time of such purchase. |
The Company may make a payment in respect of the redemption or purchase of its own Shares in any manner authorised by the Act, including out of any combination of the following: capital, its profits and the proceeds of a fresh issue of Shares.
Repurchase of subscriber Share
9.2 | Unless the directors determine otherwise, as soon as the directors determine that it is lawful for the Company to do so, the Company shall purchase from the subscriber to the Memorandum the one Share agreed to be taken by such subscriber. Such Share shall be repurchased for cash at its par value and the Company may make a payment out of capital in respect of such purchase price. |
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Power to pay for redemption or purchase in cash or in specie
9.3 | When making a payment in respect of the redemption or purchase of Shares, the directors may make the payment in cash or in specie (or partly in one and partly in the other) if so authorised by the terms of the allotment of those Shares, or by the terms applying to those Shares in accordance with Article 9.1, or otherwise by agreement with the Member holding those Shares. |
Effect of redemption or purchase of a Share
9.4 | Upon the date of redemption or purchase of a Share: |
(a) | the Member holding that Share shall cease to be entitled to any rights in respect of the Share other than the right to receive: |
(i) | the price for the Share; and |
(ii) | any dividend declared in respect of the Share prior to the date of redemption or purchase; |
(b) | the Member's name shall be removed from the register of members with respect to the Share; and |
(c) | the Share shall be cancelled or held as a Treasury Shares, as the directors may determine. |
For the purpose of this Article, the date of redemption or purchase is the date when the redemption or purchase falls due.
10 | Meetings of Members |
Power to call meetings
10.1 | The directors may call a general meeting at any time. |
10.2 | If there are insufficient directors to constitute a quorum and the remaining directors are unable to agree on the appointment of additional directors, the directors must call a general meeting for the purpose of appointing additional directors. |
10.3 | The directors must also call a general meeting if requisitioned in the manner set out in the next two Articles. |
10.4 | The requisition must be in writing and given by one or more Members who together hold at least 10% of the rights to vote at such general meeting. |
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10.5 | The requisition must also: |
(a) | specify the purpose of the meeting. |
(b) | be signed by or on behalf of each requisitioner (and for this purpose each joint holder shall be obliged to sign). The requisition may consist of several documents in like form signed by one or more of the requisitioners. |
(c) | be delivered in accordance with the notice provisions. |
10.6 | Should the directors fail to call a general meeting within 21 Clear Days from the date of receipt of a requisition, the requisitioners or any of them may call a general meeting within three months after the end of that period. |
10.7 | Without limitation to the foregoing, if there are insufficient directors to constitute a quorum and the remaining directors are unable to agree on the appointment of additional directors, any one or more Members who together hold at least 10% of the rights to vote at a general meeting may call a general meeting for the purpose of considering the business specified in the notice of meeting which shall include as an item of business the appointment of additional directors. |
10.8 | If the Members call a meeting under the above provisions, the Company shall reimburse their reasonable expenses. |
Content of notice
10.9 | Notice of a general meeting shall specify each of the following: |
(a) | the place, the date and the hour of the meeting; |
(b) | if the meeting is to be held in two or more places, the technology that will be used to facilitate the meeting; |
(c) | subject to paragraph (d), the general nature of the business to be transacted; and |
(d) | if a resolution is proposed as a Special Resolution, the text of that resolution. |
10.10 | In each notice there shall appear with reasonable prominence the following statements: |
(a) | that a Member who is entitled to attend and vote is entitled to appoint one or more proxies to attend and vote instead of that Member; and |
(b) | that a proxyholder need not be a Member. |
Period of notice
10.11 | At least five Clear Days' notice of a general meeting must be given to Members. But a meeting may be convened on shorter notice with the consent of the Member or Members who, individually or collectively, hold at least 90% of the voting rights of all those who have a right to vote at that meeting. |
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Persons entitled to receive notice
10.12 | Subject to the provisions of these Articles and to any restrictions imposed on any Shares, the notice shall be given to the following people: |
(a) | the Members; |
(b) | persons entitled to a Share in consequence of the death or bankruptcy of a Member; and |
(c) | the directors. |
Publication of notice on a website
10.13 | Subject to the Act, a notice of a general meeting may be published on a website providing the recipient is given separate notice of: |
(a) | the publication of the notice on the website; |
(b) | the place on the website where the notice may be accessed; |
(c) | how it may be accessed; and |
(d) | the place, date and time of the general meeting. |
10.14 | If a Member notifies the Company that he is unable for any reason to access the website, the Company must as soon as practicable give notice of the meeting to that Member by any other means permitted by these Articles. But this will not affect when that Member is deemed to have received notice of the meeting. |
Time a website notice is deemed to be given
10.15 | A website notice is deemed to be given when the Member is given notice of its publication. |
Required duration of publication on a website
10.16 | Where the notice of meeting is published on a website, it shall continue to be published in the same place on that website from the date of the notification until the conclusion of the meeting to which the notice relates. |
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Accidental omission to give notice or non-receipt of notice
10.17 | Proceedings at a meeting shall not be invalidated by the following: |
(a) | an accidental failure to give notice of the meeting to any person entitled to notice; or |
(b) | non-receipt of notice of the meeting by any person entitled to notice. |
10.18 | In addition, where a notice of meeting is published on a website, proceedings at the meeting shall not be invalidated merely because it is accidentally published: |
(a) | in a different place on the website; or |
(b) | for part only of the period from the date of the notification until the conclusion of the meeting to which the notice relates. |
11 | Proceedings at meetings of Members |
Quorum
11.1 | Save as provided in the following Article, no business shall be transacted at any meeting unless a quorum is present in person or by proxy. A quorum is as follows: |
(a) | if the Company has only one Member: that Member; |
(b) | if the Company has more than one Member: two Members. |
Lack of quorum
11.2 | If a quorum is not present within 15 minutes of the time appointed for the meeting, or if at any time during the meeting it becomes inquorate, then the following provisions apply: |
(a) | If the meeting was requisitioned by Members, it shall be cancelled. |
(b) | In any other case, the meeting shall stand adjourned to the same time and place seven days hence, or to such other time or place as is determined by the directors. If a quorum is not present within 15 minutes of the time appointed for the adjourned meeting, then the Members present in person or by proxy shall constitute a quorum. |
Use of technology
11.3 | A person may participate in a general meeting through the medium of conference telephone, video or any other form of communications equipment providing all persons participating in the meeting are able to hear and speak to each other throughout the meeting. A person participating in this way is deemed to be present in person at the meeting. |
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Chairman
11.4 | The chairman of a general meeting shall be the chairman of the board or such other director as the directors have nominated to chair board meetings in the absence of the chairman of the board. Absent any such person being present within 15 minutes of the time appointed for the meeting, the directors present shall elect one of their number to chair the meeting. |
11.5 | If no director is present within 15 minutes of the time appointed for the meeting, or if no director is willing to act as chairman, the Members present in person or by proxy and entitled to vote shall choose one of their number to chair the meeting. |
Right of a director to attend and speak
11.6 | Even if a director is not a Member, he shall be entitled to attend and speak at any general meeting and at any separate meeting of Members holding a particular class of Shares in the Company. |
Adjournment
11.7 | The chairman may at any time adjourn a meeting with the consent of the Members constituting a quorum. The chairman must adjourn the meeting if so directed by the meeting. No business, however, can be transacted at an adjourned meeting other than business which might properly have been transacted at the original meeting. |
11.8 | Should a meeting be adjourned for more than seven Clear Days, whether because of a lack of quorum or otherwise, Members shall be given at least seven Clear Days' notice of the date, time and place of the adjourned meeting and the general nature of the business to be transacted. Otherwise it shall not be necessary to give any notice of the adjournment. |
Method of voting
11.9 | A resolution put to the vote of the meeting shall be decided on a show of hands unless before, or on the declaration of the result of the show of hands, a poll is duly demanded. A poll may be demanded: |
(a) | by the chairman; or |
(b) | by any Member or Members present who, individually or collectively, hold at least 10% of the voting rights of all those who have a right to vote on the resolution. |
Outcome of vote by show of hands
11.10 | Unless a poll is duly demanded, a declaration by the chairman as to the result of a resolution and an entry to that effect in the minutes of the meeting shall be conclusive evidence of the outcome of a show of hands without proof of the number or proportion of the votes recorded in favour of or against the resolution. |
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Withdrawal of demand for a poll
11.11 | The demand for a poll may be withdrawn before the poll is taken, but only with the consent of the chairman. The chairman shall announce any such withdrawal to the meeting and, unless another person forthwith demands a poll, any earlier show of hands on that resolution shall be treated as the vote on that resolution; if there has been no earlier show of hands, then the resolution shall be put to the vote of the meeting. |
Taking of a poll
11.12 | A poll demanded on the question of adjournment shall be taken immediately. |
11.13 | A poll demanded on any other question shall be taken either immediately or at an adjourned meeting at such time and place as the chairman directs, not being more than 30 Clear Days after the poll was demanded. |
11.14 | The demand for a poll shall not prevent the meeting continuing to transact any business other than the question on which the poll was demanded. |
11.15 | A poll shall be taken in such manner as the chairman directs. He may appoint scrutineers (who need not be Members) and fix a place and time for declaring the result of the poll. If, through the aid of technology, the meeting is held in more than place, the chairman may appoint scrutineers in more than place; but if he considers that the poll cannot be effectively monitored at that meeting, the chairman shall adjourn the holding of the poll to a date, place and time when that can occur. |
Chairman's casting vote
11.16 | If the votes on a resolution, whether on a show of hands or on a poll, are equal the chairman may if he wishes exercise a casting vote. |
Amendments to resolutions
11.17 | An Ordinary Resolution to be proposed at a general meeting may be amended by Ordinary Resolution if: |
(a) | not less than 48 hours before the meeting is to take place (or such later time as the chairman of the meeting may determine), notice of the proposed amendment is given to the Company in writing by a Member entitled to vote at that meeting; and |
(b) | the proposed amendment does not, in the reasonable opinion of the chairman of the meeting, materially alter the scope of the resolution. |
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11.18 | A Special Resolution to be proposed at a general meeting may be amended by Ordinary Resolution, if: |
(a) | the chairman of the meeting proposes the amendment at the general meeting at which the resolution is to be proposed, and |
(b) | the amendment does not go beyond what the chairman considers is necessary to correct a grammatical or other non-substantive error in the resolution. |
11.19 | If the chairman of the meeting, acting in good faith, wrongly decides that an amendment to a resolution is out of order, the chairman's error does not invalidate the vote on that resolution. |
Written resolutions
11.20 | Members may pass a resolution in writing without holding a meeting if the following conditions are met: |
(a) | all Members entitled to vote are given notice of the resolution as if the same were being proposed at a meeting of Members; |
(b) | all Members entitled so to vote : |
(i) | sign a document; or |
(ii) | sign several documents in the like form each signed by one or more of those Members; and |
(c) | the signed document or documents is or are delivered to the Company, including, if the Company so nominates, by delivery of an Electronic Record by Electronic means to the address specified for that purpose. |
Such written resolution shall be as effective as if it had been passed at a meeting of the Members entitled to vote duly convened and held.
11.21 | If a written resolution is described as a Special Resolution or as an Ordinary Resolution, it has effect accordingly. |
11.22 | The directors may determine the manner in which written resolutions shall be put to Members. In particular, they may provide, in the form of any written resolution, for each Member to indicate, out of the number of votes the Member would have been entitled to cast at a meeting to consider the resolution, how many votes he wishes to cast in favour of the resolution and how many against the resolution or to be treated as abstentions. The result of any such written resolution shall be determined on the same basis as on a poll. |
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Sole-member company
11.23 | If the Company has only one Member, and the Member records in writing his decision on a question, that record shall constitute both the passing of a resolution and the minute of it. |
12 | Voting rights of Members |
Right to vote
12.1 | Unless their Shares carry no right to vote, or unless a call or other amount presently payable has not been paid, all Members are entitled to vote at a general meeting, whether on a show of hands or on a poll, and all Members holding Shares of a particular class of Shares are entitled to vote at a meeting of the holders of that class of Shares. |
12.2 | Members may vote in person or by proxy. |
12.3 | On a show of hands, every Member shall have one vote. For the avoidance of doubt, an individual who represents two or more Members, including a Member in that individual's own right, that individual shall be entitled to a separate vote for each Member. |
12.4 | On a poll a Member shall have one vote for each Share he holds, unless any Share carries special voting rights. |
12.5 | A fraction of a Share shall entitle its holder to an equivalent fraction of one vote. |
12.6 | No Member is bound to vote on his Shares or any of them; nor is he bound to vote each of his Shares in the same way. |
Rights of joint holders
12.7 | If Shares are held jointly, only one of the joint holders may vote. If more than one of the joint holders tenders a vote, the vote of the holder whose name in respect of those Shares appears first in the register of members shall be accepted to the exclusion of the votes of the other joint holder. |
Representation of corporate Members
12.8 | Save where otherwise provided, a corporate Member must act by a duly authorised representative. |
12.9 | A corporate Member wishing to act by a duly authorised representative must identify that person to the Company by notice in writing. |
12.10 | The authorisation may be for any period of time, and must be delivered to the Company not less than two hours before the commencement of the meeting at which it is first used. |
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12.11 | The directors of the Company may require the production of any evidence which they consider necessary to determine the validity of the notice. |
12.12 | Where a duly authorised representative is present at a meeting that Member is deemed to be present in person; and the acts of the duly authorised representative are personal acts of that Member. |
12.13 | A corporate Member may revoke the appointment of a duly authorised representative at any time by notice to the Company; but such revocation will not affect the validity of any acts carried out by the duly authorised representative before the directors of the Company had actual notice of the revocation. |
Member with mental disorder
12.14 | A Member in respect of whom an order has been made by any court having jurisdiction (whether in the Islands or elsewhere) in matters concerning mental disorder may vote, whether on a show of hands or on a poll, by that Member's receiver, curator bonis or other person authorised in that behalf appointed by that court. |
12.15 | For the purpose of the preceding Article, evidence to the satisfaction of the directors of the authority of the person claiming to exercise the right to vote must be received not less than 24 hours before holding the relevant meeting or the adjourned meeting in any manner specified for the delivery of forms of appointment of a proxy, whether in writing or by Electronic means. In default, the right to vote shall not be exercisable. |
Objections to admissibility of votes
12.16 | An objection to the validity of a person's vote may only be raised at the meeting or at the adjourned meeting at which the vote is sought to be tendered. Any objection duly made shall be referred to the chairman whose decision shall be final and conclusive. |
Form of proxy
12.17 | An instrument appointing a proxy shall be in any common form or in any other form approved by the directors. |
12.18 | The instrument must be in writing and signed in one of the following ways: |
(a) | by the Member; or |
(b) | by the Member's authorised attorney; or |
(c) | if the Member is a corporation or other body corporate, under seal or signed by an authorised officer, secretary or attorney. |
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If the directors so resolve, the Company may accept an Electronic Record of that instrument delivered in the manner specified below and otherwise satisfying the Articles about authentication of Electronic Records.
12.19 | The directors may require the production of any evidence which they consider necessary to determine the validity of any appointment of a proxy. |
12.20 | A Member may revoke the appointment of a proxy at any time by notice to the Company duly signed in accordance with the Article above about signing proxies; but such revocation will not affect the validity of any acts carried out by the proxy before the directors of the Company had actual notice of the revocation. |
How and when proxy is to be delivered
12.21 | Subject to the following Articles, the form of appointment of a proxy and any authority under which it is signed (or a copy of the authority certified notarially or in any other way approved by the directors) must be delivered so that it is received by the Company at any time before the time for holding the meeting or adjourned meeting at which the person named in the form of appointment of proxy proposes to vote. They must be delivered in either of the following ways: |
(a) | In the case of an instrument in writing, it must be left at or sent by post: |
(i) | to the registered office of the Company; or |
(ii) | to such other place within the Islands specified in the notice convening the meeting or in any form of appointment of proxy sent out by the Company in relation to the meeting. |
(b) | If, pursuant to the notice provisions, a notice may be given to the Company in an Electronic Record, an Electronic Record of an appointment of a proxy must be sent to the address specified pursuant to those provisions unless another address for that purpose is specified: |
(i) | in the notice convening the meeting; or |
(ii) | in any form of appointment of a proxy sent out by the Company in relation to the meeting; or |
(iii) | in any invitation to appoint a proxy issued by the Company in relation to the meeting. |
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12.22 | Where a poll is taken: |
(a) | if it is taken more than seven Clear Days after it is demanded, the form of appointment of a proxy and any accompanying authority (or an Electronic Record of the same) must be delivered as required under the preceding Article not less than 24 hours before the time appointed for the taking of the poll; |
(b) | but if it to be taken within seven Clear Days after it was demanded, the form of appointment of a proxy and any accompanying authority (or an Electronic Record of the same) must be e delivered as required under the preceding Article not less than two hours before the time appointed for the taking of the poll. |
12.23 | If the form of appointment of proxy is not delivered on time, it is invalid. |
Voting by proxy
12.24 | A proxy shall have the same voting rights at a meeting or adjourned meeting as the Member would have had except to the extent that the instrument appointing him limits those rights. Notwithstanding the appointment of a proxy, a Member may attend and vote at a meeting or adjourned meeting. If a Member votes on any resolution a vote by his proxy on the same resolution, unless in respect of different Shares, shall be invalid. |
13 | Number of directors |
Unless otherwise determined by Ordinary Resolution, the minimum number of directors shall be one and the maximum number shall be ten. There shall be no directors, however, until the first director is or the first directors are appointed by the subscriber or subscribers to the Memorandum.
14 | Appointment, disqualification and removal of directors |
First directors
14.1 | The first directors shall be appointed in writing by the subscriber or subscribers to the Memorandum. |
No age limit
14.2 | There is no age limit for directors save that they must be aged at least 18 years. |
Corporate directors
14.3 | Unless prohibited by law, a body corporate may be a director. If a body corporate is a director, the Articles about representation of corporate Members at general meetings apply, mutatis mutandis, to the Articles about directors' meetings. |
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No shareholding qualification
14.4 | Unless a shareholding qualification for directors is fixed by Ordinary Resolution, no director shall be required to own Shares as a condition of his appointment. |
Appointment of directors
14.5 | A director may be appointed by Ordinary Resolution or by the directors. Any appointment may be to fill a vacancy or as an additional director. |
14.6 | Notwithstanding the other provisions of these Articles, in any case where, as a result of death, the Company has no directors and no shareholders, the personal representatives of the last shareholder to have died have the power, by notice in writing to the Company, to appoint a person to be a director. For the purpose of this Article: |
(a) | where two or more shareholders die in circumstances rendering it uncertain who was the last to die, a younger shareholder is deemed to have survived an older shareholder; |
(b) | if the last shareholder died leaving a will which disposes of that shareholder’s shares in the Company (whether by way of specific gift, as part of the residuary estate, or otherwise): |
(i) | the expression personal representatives of the last shareholder means: |
(A) | until a grant of probate in respect of that will has been obtained from the Grand Court of the Cayman Islands, all of the executors named in that will who are living at the time the power of appointment under this Article is exercised; and |
(B) | after such grant of probate has been obtained, only such of those executors who have proved that will; |
(ii) | without derogating from section 3(1) of the Succession Act (Revised), the executors named in that will may exercise the power of appointment under this Article without first obtaining a grant of probate. |
14.7 | A remaining director may appoint a director even though there is not a quorum of directors. |
14.8 | No appointment can cause the number of directors to exceed the maximum; and any such appointment shall be invalid. |
Removal of directors
14.9 | A director may be removed by Ordinary Resolution. |
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Resignation of directors
14.10 | A director may at any time resign office by giving to the Company notice in writing or, if permitted pursuant to the notice provisions, in an Electronic Record delivered in either case in accordance with those provisions. |
14.11 | Unless the notice specifies a different date, the director shall be deemed to have resigned on the date that the notice is delivered to the Company. |
Termination of the office of director
14.12 | A director's office shall be terminated forthwith if: |
(a) | he is prohibited by the law of the Islands from acting as a director; or |
(b) | he is made bankrupt or makes an arrangement or composition with his creditors generally; or |
(c) | in the opinion of a registered medical practitioner by whom he is being treated he becomes physically or mentally incapable of acting as a director; or |
(d) | he is made subject to any law relating to mental health or incompetence, whether by court order or otherwise; or |
(e) | without the consent of the other directors, he is absent from meetings of directors for a continuous period of six months. |
15 | Alternate directors |
Appointment and removal
15.1 | Any director may appoint any other person, including another director, to act in his place as an alternate director. No appointment shall take effect until the director has given notice of the appointment to the other directors. Such notice must be given to each other director by either of the following methods: |
(a) | by notice in writing in accordance with the notice provisions; |
(b) | if the other director has an email address, by emailing to that address a scanned copy of the notice as a PDF attachment (the PDF version being deemed to be the notice unless Article 30.7 applies), in which event notice shall be taken to be given on the date of receipt by the recipient in readable form. For the avoidance of doubt, the same email may be sent to the email address of more than one director (and to the email address of the Company pursuant to Article 15.4(c)). |
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15.2 | Without limitation to the preceding Article, a director may appoint an alternate for a particular meeting by sending an email to his fellow directors informing them that they are to take such email as notice of such appointment for such meeting. Such appointment shall be effective without the need for a signed notice of appointment or the giving of notice to the Company in accordance with Article 15.4. |
15.3 | A director may revoke his appointment of an alternate at any time. No revocation shall take effect until the director has given notice of the revocation to the other directors. Such notice must be given by either of the methods specified in Article 15.1. |
15.4 | A notice of appointment or removal of an alternate director must also be given to the Company by any of the following methods: |
(a) | by notice in writing in accordance with the notice provisions; |
(b) | if the Company has a facsimile address for the time being, by sending by facsimile transmission to that facsimile address a facsimile copy or, otherwise, by sending by facsimile transmission to the facsimile address of the Company's registered office a facsimile copy (in either case, the facsimile copy being deemed to be the notice unless Article 30.7 applies), in which event notice shall be taken to be given on the date of an error-free transmission report from the sender’s fax machine; |
(c) | if the Company has an email address for the time being, by emailing to that email address a scanned copy of the notice as a PDF attachment or, otherwise, by emailing to the email address provided by the Company's registered office a scanned copy of the notice as a PDF attachment (in either case, the PDF version being deemed to be the notice unless Article 30.7 applies), in which event notice shall be taken to be given on the date of receipt by the Company or the Company's registered office (as appropriate) in readable form; or |
(d) | if permitted pursuant to the notice provisions, in some other form of approved Electronic Record delivered in accordance with those provisions in writing. |
Notices
15.5 | All notices of meetings of directors shall continue to be given to the appointing director and not to the alternate. |
Rights of alternate director
15.6 | An alternate director shall be entitled to attend and vote at any board meeting or meeting of a committee of the directors at which the appointing director is not personally present, and generally to perform all the functions of the appointing director in his absence. |
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15.7 | For the avoidance of doubt: |
(a) | if another director has been appointed an alternate director for one or more directors, he shall be entitled to a separate vote in his own right as a director and in right of each other director for whom he has been appointed an alternate; and |
(b) | if a person other than a director has been appointed an alternate director for more than one director, he shall be entitled to a separate vote in right of each director for whom he has been appointed an alternate. |
15.8 | An alternate director, however, is not entitled to receive any remuneration from the Company for services rendered as an alternate director. |
Appointment ceases when the appointor ceases to be a director
15.9 | An alternate director shall cease to be an alternate director if the director who appointed him ceases to be a director. |
Status of alternate director
15.10 | An alternate director shall carry out all functions of the director who made the appointment. |
15.11 | Save where otherwise expressed, an alternate director shall be treated as a director under these Articles. |
15.12 | An alternate director is not the agent of the director appointing him. |
15.13 | An alternate director is not entitled to any remuneration for acting as alternate director. |
Status of the director making the appointment
15.14 | A director who has appointed an alternate is not thereby relieved from the duties which he owes the Company. |
16 | Powers of directors |
Powers of directors
16.1 | Subject to the provisions of the Act, the Memorandum and these Articles, the business of the Company shall be managed by the directors who may for that purpose exercise all the powers of the Company. |
16.2 | No prior act of the directors shall be invalidated by any subsequent alteration of the Memorandum or these Articles. However, to the extent allowed by the Act, Members may by Special Resolution validate any prior or future act of the directors which would otherwise be in breach of their duties. |
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Appointments to office
16.3 | The directors may appoint a director: |
(a) | as chairman of the board of directors; |
(b) | as managing director; |
(c) | to any other executive office |
for such period and on such terms, including as to remuneration, as they think fit.
16.4 | The appointee must consent in writing to holding that office. |
16.5 | Where a chairman is appointed he shall, unless unable to do so, preside at every meeting of directors. |
16.6 | If there is no chairman, or if the chairman is unable to preside at a meeting, that meeting may select its own chairman; or the directors may nominate one of their number to act in place of the chairman should he ever not be available. |
16.7 | Subject to the provisions of the Act, the directors may also appoint any person, who need not be a director: |
(a) | as Secretary; and |
(b) | to any office that may be required |
for such period and on such terms, including as to remuneration, as they think fit. In the case of an Officer, that Officer may be given any title the directors decide.
16.8 | The Secretary or Officer must consent in writing to holding that office. |
16.9 | A director, Secretary or other Officer of the Company may not the hold the office, or perform the services, of auditor. |
Remuneration
16.10 | Every director may be remunerated by the Company for the services he provides for the benefit of the Company, whether as director, employee or otherwise, and shall be entitled to be paid for the expenses incurred in the Company's business including attendance at directors' meetings. |
16.11 | A director's remuneration shall be fixed by the Company by Ordinary Resolution. Unless that resolution provides otherwise, the remuneration shall be deemed to accrue from day to day. |
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16.12 | Remuneration may take any form and may include arrangements to pay pensions, health insurance, death or sickness benefits, whether to the director or to any other person connected to or related to him. |
16.13 | Unless his fellow directors determine otherwise, a director is not accountable to the Company for remuneration or other benefits received from any other company which is in the same group as the Company or which has common shareholdings. |
Disclosure of information
16.14 | The directors may release or disclose to a third party any information regarding the affairs of the Company, including any information contained in the register of members relating to a Member, (and they may authorise any director, Officer or other authorised agent of the Company to release or disclose to a third party any such information in his possession) if: |
(a) | the Company or that person, as the case may be, is lawfully required to do so under the laws of any jurisdiction to which the Company is subject; or |
(b) | such disclosure is in compliance with the rules of any stock exchange upon which the Company's shares are listed; or |
(c) | such disclosure is in accordance with any contract entered into by the Company; or |
(d) | the directors are of the opinion such disclosure would assist or facilitate the Company’s operations. |
17 | Delegation of powers |
Power to delegate any of the directors' powers to a committee
17.1 | The directors may delegate any of their powers to any committee consisting of one or more persons who need not be Members. Persons on the committee may include non-directors so long as the majority of those persons are directors. |
17.2 | The delegation may be collateral with, or to the exclusion of, the directors' own powers. |
17.3 | The delegation may be on such terms as the directors think fit, including provision for the committee itself to delegate to a sub-committee; save that any delegation must be capable of being revoked or altered by the directors at will. |
17.4 | Unless otherwise permitted by the directors, a committee must follow the procedures prescribed for the taking of decisions by directors. |
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Power to appoint an agent of the Company
17.5 | The directors may appoint any person, either generally or in respect of any specific matter, to be the agent of the Company with or without authority for that person to delegate all or any of that person's powers. The directors may make that appointment: |
(a) | by causing the Company to enter into a power of attorney or agreement; or |
(b) | in any other manner they determine. |
Power to appoint an attorney or authorised signatory of the Company
17.6 | The directors may appoint any person, whether nominated directly or indirectly by the directors, to be the attorney or the authorised signatory of the Company. The appointment may be: |
(a) | for any purpose; |
(b) | with the powers, authorities and discretions; |
(c) | for the period; and |
(d) | subject to such conditions |
as they think fit. The powers, authorities and discretions, however, must not exceed those vested in, or exercisable, by the directors under these Articles. The directors may do so by power of attorney or any other manner they think fit.
17.7 | Any power of attorney or other appointment may contain such provision for the protection and convenience for persons dealing with the attorney or authorised signatory as the directors think fit. Any power of attorney or other appointment may also authorise the attorney or authorised signatory to delegate all or any of the powers, authorities and discretions vested in that person. |
Power to appoint a proxy
17.8 | Any director may appoint any other person, including another director, to represent him at any meeting of the directors. If a director appoints a proxy, then for all purposes the presence or vote of the proxy shall be deemed to be that of the appointing director. |
17.9 | Articles 15.1 to 15.4 inclusive (relating to the appointment by directors of alternate directors) apply, mutatis mutandis, to the appointment of proxies by directors. |
17.10 | A proxy is an agent of the director appointing him and is not an officer of the Company. |
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18 | Meetings of directors |
Regulation of directors' meetings
18.1 | Subject to the provisions of these Articles, the directors may regulate their proceedings as they think fit. |
Calling meetings
18.2 | Any director may call a meeting of directors at any time. The Secretary, if any, must call a meeting of the directors if requested to do so by a director. |
Notice of meetings
18.3 | Every director shall be given notice of a meeting, although a director may waive retrospectively the requirement to be given notice. Notice may be oral. |
Period of notice
18.4 | At least five Clear Days’ notice of a meeting of directors must be given to directors. But a meeting may be convened on shorter notice with the consent of all directors. |
Use of technology
18.5 | A director may participate in a meeting of directors through the medium of conference telephone, video or any other form of communications equipment providing all persons participating in the meeting are able to hear and speak to each other throughout the meeting. |
18.6 | A director participating in this way is deemed to be present in person at the meeting. |
Place of meetings
18.7 | If all the directors participating in a meeting are not in the same place, they may decide that the meeting is to be treated as taking place wherever any of them is. |
Quorum
18.8 | The quorum for the transaction of business at a meeting of directors shall be two unless the directors fix some other number or unless the Company has only one director. |
Voting
18.9 | A question which arises at a board meeting shall be decided by a majority of votes. If votes are equal the chairman may, if he wishes, exercise a casting vote. |
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Validity
18.10 | Anything done at a meeting of directors is unaffected by the fact that it is later discovered that any person was not properly appointed, or had ceased to be a director, or was otherwise not entitled to vote. |
Recording of dissent
18.11 | A director present at a meeting of directors shall be presumed to have assented to any action taken at that meeting unless: |
(a) | his dissent is entered in the minutes of the meeting; or |
(b) | he has filed with the meeting before it is concluded signed dissent from that action; or |
(c) | he has forwarded to the Company as soon as practical following the conclusion of that meeting signed dissent. |
A director who votes in favour of an action is not entitled to record his dissent to it.
Written resolutions
18.12 | The directors may pass a resolution in writing without holding a meeting if all directors sign a document or sign several documents in the like form each signed by one or more of those directors. |
18.13 | Despite the foregoing, a resolution in writing signed by a validly appointed alternate director or by a validly appointed proxy need not also be signed by the appointing director. But if a written resolution is signed personally by the appointing director, it need not also be signed by his alternate or proxy. |
18.14 | Such written resolution shall be as effective as if it had been passed at a meeting of the directors duly convened and held; and it shall be treated as having been passed on the day and at the time that the last director signs. |
Sole director's minute
18.15 | Where a sole director signs a minute recording his decision on a question, that record shall constitute the passing of a resolution in those terms. |
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19 | Permissible directors' interests and disclosure |
Permissible interests subject to disclosure
19.1 | Save as expressly permitted by these Articles or as set out below, a director may not have a direct or indirect interest or duty which conflicts or may possibly conflict with the interests of the Company. |
19.2 | If, notwithstanding the prohibition in the preceding Article, a director discloses to his fellow directors the nature and extent of any material interest or duty in accordance with the next Article, he may: |
(a) | be a party to, or otherwise interested in, any transaction or arrangement with the Company or in which the Company is or may otherwise be interested; |
(b) | be interested in another body corporate promoted by the Company or in which the Company is otherwise interested. In particular, the director may be a director, secretary or officer of, or employed by, or be a party to any transaction or arrangement with, or otherwise interested in, that other body corporate. |
19.3 | Such disclosure may be made at a meeting at a meeting of the board or otherwise (and, if otherwise, it must be made in writing). The director must disclose the nature and extent of his direct or indirect interest in or duty in relation to a transaction or arrangement or series of transactions or arrangements with the Company or in which the Company has any material interest. |
19.4 | If a director has made disclosure in accordance with the preceding Article, then he shall not, by reason only of his office, be accountable to the Company for any benefit that he derives from any such transaction or arrangement or from any such office or employment or from any interest in any such body corporate, and no such transaction or arrangement shall be liable to be avoided on the ground of any such interest or benefit. |
Notification of interests
19.5 | For the purposes of the preceding Articles: |
(a) | a general notice that a director gives to the other directors that he is to be regarded as having an interest of the nature and extent specified in the notice in any transaction or arrangement in which a specified person or class of persons is interested shall be deemed to be a disclosure that he has an interest in or duty in relation to any such transaction of the nature and extent so specified; and |
(b) | an interest of which a director has no knowledge and of which it is unreasonable to expect him to have knowledge shall not be treated as an interest of his. |
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19.6 | A director shall not be treated as having an interest in a transaction or arrangement if he has no knowledge of that interest and it is unreasonable to expect the director to have that knowledge. |
Voting where a director is interested in a matter
19.7 | A director may vote at a meeting of directors on any resolution concerning a matter in which that director has an interest or duty, whether directly or indirectly, so long as that director discloses any material interest pursuant to these Articles. The director shall be counted towards a quorum of those present at the meeting. If the director votes on the resolution, his vote shall be counted. |
19.8 | Where proposals are under consideration concerning the appointment of two or more directors to offices or employment with the Company or any body corporate in which the Company is interested, the proposals may be divided and considered in relation to each director separately and each of the directors concerned shall be entitled to vote and be counted in the quorum in respect of each resolution except that concerning his or her own appointment. |
20 | Minutes |
The Company shall cause minutes to be made in books kept for the purpose in accordance with the Act.
21 | Accounts and audit |
Accounting and other records
21.1 | The directors must ensure that proper accounting and other records are kept, and that accounts and associated reports are distributed in accordance with the requirements of the Act. |
No automatic right of inspection
21.2 | Members are only entitled to inspect the Company's records if they are expressly entitled to do so by law, or by resolution made by the directors or passed by Ordinary Resolution. |
Sending of accounts and reports
21.3 | The Company's accounts and associated directors' report or auditor's report that are required or permitted to be sent to any person pursuant to any law shall be treated as properly sent to that person if: |
(a) | they are sent to that person in accordance with the notice provisions: or |
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(b) | they are published on a website providing that person is given separate notice of: |
(i) | the fact that publication of the documents has been published on the website; |
(ii) | the address of the website; and |
(iii) | the place on the website where the documents may be accessed; and |
(iv) | how they may be accessed. |
21.4 | If, for any reason, a person notifies the Company that he is unable to access the website, the Company must, as soon as practicable, send the documents to that person by any other means permitted by these Articles. This, however, will not affect when that person is taken to have received the documents under the next Article. |
Time of receipt if documents are published on a website
21.5 | Documents sent by being published on a website in accordance with the preceding two Articles are only treated as sent at least five Clear Days before the date of the meeting at which they are to be laid if: |
(a) | the documents are published on the website throughout a period beginning at least five Clear Days before the date of the meeting and ending with the conclusion of the meeting; and |
(b) | the person is given at least five Clear Days' notice of the hearing. |
Validity despite accidental error in publication on website
21.6 | If, for the purpose of a meeting, documents are sent by being published on a website in accordance with the preceding Articles, the proceedings at that meeting are not invalidated merely because: |
(a) | those documents are, by accident, published in a different place on the website to the place notified; or |
(b) | they are published for part only of the period from the date of notification until the conclusion of that meeting. |
When accounts are to be audited
21.7 | Unless the directors or the Members, by Ordinary Resolution, so resolve or unless the Act so requires, the Company's accounts will not be audited. If the Members so resolve, the Company's accounts shall be audited in the manner determined by Ordinary Resolution. Alternatively, if the directors so resolve, they shall be audited in the manner they determine. |
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22 | Financial year |
Unless the directors otherwise specify, the financial year of the Company:
(a) | shall end on 31st December in the year of its incorporation and each following year; and |
(b) | shall begin when it was incorporated and on 1st January each following year. |
23 | Record dates |
Except to the extent of any conflicting rights attached to Shares, the directors may fix any time and date as the record date for declaring or paying a dividend or making or issuing an allotment of Shares. The record date may be before or after the date on which a dividend, allotment or issue is declared, paid or made.
24 | Dividends |
Declaration of dividends by Members
24.1 | Subject to the provisions of the Act, the Company may by Ordinary Resolution declare dividends in accordance with the respective rights of the Members but no dividend shall exceed the amount recommended by the directors. |
Payment of interim dividends and declaration of final dividends by directors
24.2 | The directors may pay interim dividends or declare final dividends in accordance with the respective rights of the Members if it appears to them that they are justified by the financial position of the Company and that such dividends may lawfully be paid. |
24.3 | Subject to the provisions of the Act, in relation to the distinction between interim dividends and final dividends, the following applies: |
(a) | Upon determination to pay a dividend or dividends described as interim by the directors in the dividend resolution, no debt shall be created by the declaration until such time as payment is made. |
(b) | Upon declaration of a dividend or dividends described as final by the directors in the dividend resolution, a debt shall be created immediately following the declaration, the due date to be the date the dividend is stated to be payable in the resolution. |
If the resolution fails to specify whether a dividend is final or interim, it shall be assumed to be interim.
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24.4 | In relation to Shares carrying differing rights to dividends or rights to dividends at a fixed rate, the following applies: |
(a) | If the share capital is divided into different classes, the directors may pay dividends on Shares which confer deferred or non-preferred rights with regard to dividends as well as on Shares which confer preferential rights with regard to dividends but no dividend shall be paid on Shares carrying deferred or non-preferred rights if, at the time of payment, any preferential dividend is in arrears. |
(b) | The directors may also pay, at intervals settled by them, any dividend payable at a fixed rate if it appears to them that there are sufficient funds of the Company lawfully available for distribution to justify the payment. |
(c) | If the directors act in good faith, they shall not incur any liability to the Members holding Shares conferring preferred rights for any loss those Members may suffer by the lawful payment of the dividend on any Shares having deferred or non-preferred rights. |
Apportionment of dividends
24.5 | Except as otherwise provided by the rights attached to Shares, all dividends shall be declared and paid according to the amounts paid up on the Shares on which the dividend is paid. All dividends shall be apportioned and paid proportionately to the amount paid up on the Shares during the time or part of the time in respect of which the dividend is paid. But if a Share is issued on terms providing that it shall rank for dividend as from a particular date, that Share shall rank for dividend accordingly. |
Right of set off
24.6 | The directors may deduct from a dividend or any other amount payable to a person in respect of a Share any amount due by that person to the Company on a call or otherwise in relation to a Share. |
Power to pay other than in cash
24.7 | If the directors so determine, any resolution declaring a dividend may direct that it shall be satisfied wholly or partly by the distribution of assets. If a difficulty arises in relation to the distribution, the directors may settle that difficulty in any way they consider appropriate. For example, they may do any one or more of the following: |
(a) | issue fractional Shares; |
(b) | fix the value of assets for distribution and make cash payments to some Members on the footing of the value so fixed in order to adjust the rights of Members; and |
(c) | vest some assets in trustees. |
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How payments may be made
24.8 | A dividend or other monies payable on or in respect of a Share may be paid in any of the following ways: |
(a) | if the Member holding that Share or other person entitled to that Share nominates a bank account for that purpose - by wire transfer to that bank account; or |
(b) | by cheque or warrant sent by post to the registered address of the Member holding that Share or other person entitled to that Share. |
24.9 | For the purpose of paragraph (a) of the preceding Article, the nomination may be in writing or in an Electronic Record and the bank account nominated may be the bank account of another person. For the purpose of paragraph (b) of the preceding Article, subject to any applicable law or regulation, the cheque or warrant shall be made to the order of the Member holding that Share or other person entitled to the Share or to his nominee, whether nominated in writing or in an Electronic Record, and payment of the cheque or warrant shall be a good discharge to the Company. |
24.10 | If two or more persons are registered as the holders of the Share or are jointly entitled to it by reason of the death or bankruptcy of the registered holder (Joint Holders), a dividend (or other amount) payable on or in respect of that Share may be paid as follows: |
(a) | to the registered address of the Joint Holder of the Share who is named first on the register of members or to the registered address of the deceased or bankrupt holder, as the case may be; or |
(b) | to the address or bank account of another person nominated by the Joint Holders, whether that nomination is in writing or in an Electronic Record. |
24.11 | Any Joint Holder of a Share may give a valid receipt for a dividend (or other amount) payable in respect of that Share. |
Dividends or other moneys not to bear interest in absence of special rights
24.12 | Unless provided for by the rights attached to a Share, no dividend or other monies payable by the Company in respect of a Share shall bear interest. |
Dividends unable to be paid or unclaimed
24.13 | If a dividend cannot be paid to a Member or remains unclaimed within six weeks after it was declared or both, the directors may pay it into a separate account in the Company's name. If a dividend is paid into a separate account, the Company shall not be constituted trustee in respect of that account and the dividend shall remain a debt due to the Member. |
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24.14 | A dividend that remains unclaimed for a period of six years after it became due for payment shall be forfeited to, and shall cease to remain owing by, the Company. |
25 | Capitalisation of profits |
Capitalisation of profits or of any share premium account or capital redemption reserve
25.1 | The directors may resolve to capitalise: |
(a) | any part of the Company's profits not required for paying any preferential dividend (whether or not those profits are available for distribution); or |
(b) | any sum standing to the credit of the Company's share premium account or capital redemption reserve, if any. |
The amount resolved to be capitalised must be appropriated to the Members who would have been entitled to it had it been distributed by way of dividend and in the same proportions. The benefit to each Member so entitled must be given in either or both of the following ways:
(a) | by paying up the amounts unpaid on that Member's Shares; |
(b) | by issuing Fully Paid Shares, debentures or other securities of the Company to that Member or as that Member directs. The directors may resolve that any Shares issued to the Member in respect of partly paid Shares (Original Shares) rank for dividend only to the extent that the Original Shares rank for dividend while those Original Shares remain partly paid. |
Applying an amount for the benefit of members
25.2 | The amount capitalised must be applied to the benefit of Members in the proportions to which the Members would have been entitled to dividends if the amount capitalised had been distributed as a dividend. |
25.3 | Subject to the Act, if a fraction of a Share, a debenture, or other security is allocated to a Member, the directors may issue a fractional certificate to that Member or pay him the cash equivalent of the fraction. |
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26 | Share premium account |
Directors to maintain share premium account
26.1 | The directors shall establish a share premium account in accordance with the Act. They shall carry to the credit of that account from time to time an amount equal to the amount or value of the premium paid on the issue of any Share or capital contributed or such other amounts required by the Act. |
Debits to share premium account
26.2 | The following amounts shall be debited to any share premium account: |
(a) | on the redemption or purchase of a Share, the difference between the nominal value of that Share and the redemption or purchase price; and |
(b) | any other amount paid out of a share premium account as permitted by the Act. |
26.3 | Notwithstanding the preceding Article, on the redemption or purchase of a Share, the directors may pay the difference between the nominal value of that Share and the redemption purchase price out of the profits of the Company or, as permitted by the Act, out of capital. |
27 | Seal |
Company seal
27.1 | The Company may have a seal if the directors so determine. |
Duplicate seal
27.2 | Subject to the provisions of the Act, the Company may also have a duplicate seal or seals for use in any place or places outside the Islands. Each duplicate seal shall be a facsimile of the original seal of the Company. However, if the directors so determine, a duplicate seal shall have added on its face the name of the place where it is to be used. |
When and how seal is to be used
27.3 | A seal may only be used by the authority of the directors. Unless the directors otherwise determine, a document to which a seal is affixed must be signed in one of the following ways: |
(a) | by a director (or his alternate) and the Secretary; or |
(b) | by a single director (or his alternate). |
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If no seal is adopted or used
27.4 | If the directors do not adopt a seal, or a seal is not used, a document may be executed in the following manner: |
(a) | by a director (or his alternate) and the Secretary; or |
(b) | by a single director (or his alternate); or |
(c) | in any other manner permitted by the Act. |
Power to allow non-manual signatures and facsimile printing of seal
27.5 | The directors may determine that either or both of the following applies: |
(a) | that the seal or a duplicate seal need not be affixed manually but may be affixed by some other method or system of reproduction; |
(b) | that a signature required by these Articles need not be manual but may be a mechanical or Electronic Signature. |
Validity of execution
27.6 | If a document is duly executed and delivered by or on behalf of the Company, it shall not be regarded as invalid merely because, at the date of the delivery, the Secretary, or the director, or other Officer or person who signed the document or affixed the seal for and on behalf of the Company ceased to be the Secretary or hold that office and authority on behalf of the Company. |
28 | Indemnity |
Indemnity
28.1 | To the extent permitted by law, the Company shall indemnify each existing or former Secretary, director (including alternate director), and other Officer of the Company (including an investment adviser or an administrator or liquidator) and their personal representatives against: |
(a) | all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by the existing or former Secretary or Officer in or about the conduct of the Company's business or affairs or in the execution or discharge of the existing or former Secretary's or Officer's duties, powers, authorities or discretions; and |
(b) | without limitation to paragraph (a), all costs, expenses, losses or liabilities incurred by the existing or former Secretary or Officer in defending (whether successfully or otherwise) any civil, criminal, administrative or investigative proceedings (whether threatened, pending or completed) concerning the Company or its affairs in any court or tribunal, whether in the Islands or elsewhere. |
No such existing or former Secretary or Officer, however, shall be indemnified in respect of any matter arising out of his own dishonesty.
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28.2 | To the extent permitted by law, the Company may make a payment, or agree to make a payment, whether by way of advance, loan or otherwise, for any legal costs incurred by an existing or former Secretary or Officer of the Company in respect of any matter identified in paragraph (a) or paragraph (b) of the preceding Article on condition that the Secretary or Officer must repay the amount paid by the Company to the extent that it is ultimately found not liable to indemnify the Secretary or that Officer for those legal costs. |
Release
28.3 | To the extent permitted by law, the Company may by Special Resolution release any existing or former director (including alternate director), Secretary or other Officer of the Company from liability for any loss or damage or right to compensation which may arise out of or in connection with the execution or discharge of the duties, powers, authorities or discretions of his office; but there may be no release from liability arising out of or in connection with that person's own dishonesty. |
Insurance
28.4 | To the extent permitted by law, the Company may pay, or agree to pay, a premium in respect of a contract insuring each of the following persons against risks determined by the directors, other than liability arising out of that person's own dishonesty: |
(a) | an existing or former director (including alternate director), Secretary or Officer or auditor of: |
(i) | the Company; |
(ii) | a company which is or was a subsidiary of the Company; |
(iii) | a company in which the Company has or had an interest (whether direct or indirect); and |
(b) | a trustee of an employee or retirement benefits scheme or other trust in which any of the persons referred to in paragraph (a) is or was interested. |
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29 | Notices |
Form of notices
29.1 | Save where these Articles provide otherwise, any notice to be given to or by any person pursuant to these Articles shall be: |
(a) | in writing signed by or on behalf of the giver in the manner set out below for written notices; or |
(b) | subject to the next Article, in an Electronic Record signed by or on behalf of the giver by Electronic Signature and authenticated in accordance with Articles about authentication of Electronic Records; or |
(c) | where these Articles expressly permit, by the Company by means of a website. |
Electronic communications
29.2 | Without limitation to Articles 15.1 to 15.4 inclusive (relating to the appointment and removal by directors of alternate directors) and to Articles 17.8 to 17.10 inclusive (relating to the appointment by directors of proxies), a notice may only be given to the Company in an Electronic Record if: |
(a) | the directors so resolve; |
(b) | the resolution states how an Electronic Record may be given and, if applicable, specifies an email address for the Company; and |
(c) | the terms of that resolution are notified to the Members for the time being and, if applicable, to those directors who were absent from the meeting at which the resolution was passed. |
If the resolution is revoked or varied, the revocation or variation shall only become effective when its terms have been similarly notified.
29.3 | A notice may not be given by Electronic Record to a person other than the Company unless the recipient has notified the giver of an Electronic address to which notice may be sent. |
Persons authorised to give notices
29.4 | A notice by either the Company or a Member pursuant to these Articles may be given on behalf of the Company or a Member by a director or company secretary of the Company or a Member. |
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Delivery of written notices
29.5 | Save where these Articles provide otherwise, a notice in writing may be given personally to the recipient, or left at (as appropriate) the Member's or director's registered address or the Company's registered office, or posted to that registered address or registered office. |
Joint holders
29.6 | Where Members are joint holders of a Share, all notices shall be given to the Member whose name first appears in the register of members. |
Signatures
29.7 | A written notice shall be signed when it is autographed by or on behalf of the giver, or is marked in such a way as to indicate its execution or adoption by the giver. |
29.8 | An Electronic Record may be signed by an Electronic Signature. |
Evidence of transmission
29.9 | A notice given by Electronic Record shall be deemed sent if an Electronic Record is kept demonstrating the time, date and content of the transmission, and if no notification of failure to transmit is received by the giver. |
29.10 | A notice given in writing shall be deemed sent if the giver can provide proof that the envelope containing the notice was properly addressed, pre-paid and posted, or that the written notice was otherwise properly transmitted to the recipient. |
Giving notice to a deceased or bankrupt Member
29.11 | A notice may be given by the Company to the persons entitled to a Share in consequence of the death or bankruptcy of a Member by sending or delivering it, in any manner authorised by these Articles for the giving of notice to a Member, addressed to them by name, or by the title of representatives of the deceased, or trustee of the bankrupt or by any like description, at the address, if any, supplied for that purpose by the persons claiming to be so entitled. |
29.12 | Until such an address has been supplied, a notice may be given in any manner in which it might have been given if the death or bankruptcy had not occurred. |
Date of giving notices
29.13 | A notice is given on the date identified in the following table. |
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Method for giving notices | When taken to be given |
Personally | At the time and date of delivery |
By leaving it at the member's registered address | At the time and date it was left |
If the recipient has an address within the Islands, by posting it by prepaid post to the street or postal address of that recipient | 48 hours after it was posted |
If the recipient has an address outside the Islands, by posting it by prepaid airmail to the street or postal address of that recipient | 7 Clear Days after posting |
By Electronic Record (other than publication on a website), to recipient's Electronic address | Within 24 hours after it was sent |
By publication on a website | See the Articles about the time when notice of a meeting of Members or accounts and reports, as the case may be, are published on a website |
Saving provision
29.14 | None of the preceding notice provisions shall derogate from the Articles about the delivery of written resolutions of directors and written resolutions of Members. |
30 | Authentication of Electronic Records |
Application of Articles
30.1 | Without limitation to any other provision of these Articles, any notice, written resolution or other document under these Articles that is sent by Electronic means by a Member, or by the Secretary, or by a director or other Officer of the Company, shall be deemed to be authentic if either Article 30.2 or Article 30.4 applies. |
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Authentication of documents sent by Members by Electronic means
30.2 | An Electronic Record of a notice, written resolution or other document sent by Electronic means by or on behalf of one or more Members shall be deemed to be authentic if the following conditions are satisfied: |
(a) | the Member or each Member, as the case may be, signed the original document, and for this purpose Original Document includes several documents in like form signed by one or more of those Members; and |
(b) | the Electronic Record of the Original Document was sent by Electronic means by, or at the direction of, that Member to an address specified in accordance with these Articles for the purpose for which it was sent; and |
(c) | Article 30.7 does not apply. |
30.3 | For example, where a sole Member signs a resolution and sends the Electronic Record of the original resolution, or causes it to be sent, by facsimile transmission to the address in these Articles specified for that purpose, the facsimile copy shall be deemed to be the written resolution of that Member unless Article 30.7 applies. |
Authentication of document sent by the Secretary or Officers of the Company by Electronic means
30.4 | An Electronic Record of a notice, written resolution or other document sent by or on behalf of the Secretary or an Officer or Officers of the Company shall be deemed to be authentic if the following conditions are satisfied: |
(a) | the Secretary or the Officer or each Officer, as the case may be, signed the original document, and for this purpose Original Document includes several documents in like form signed by the Secretary or one or more of those Officers; and |
(b) | the Electronic Record of the Original Document was sent by Electronic means by, or at the direction of, the Secretary or that Officer to an address specified in accordance with these Articles for the purpose for which it was sent; and |
(c) | Article 30.7 does not apply. |
This Article applies whether the document is sent by or on behalf of the Secretary or Officer in his own right or as a representative of the Company.
30.5 | For example, where a sole director signs a resolution and scans the resolution, or causes it to be scanned, as a PDF version which is attached to an email sent to the address in these Articles specified for that purpose, the PDF version shall be deemed to be the written resolution of that director unless Article 30.7 applies. |
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Manner of signing
30.6 | For the purposes of these Articles about the authentication of Electronic Records, a document will be taken to be signed if it is signed manually or in any other manner permitted by these Articles. |
Saving provision
30.7 | A notice, written resolution or other document under these Articles will not be deemed to be authentic if the recipient, acting reasonably: |
(a) | believes that the signature of the signatory has been altered after the signatory had signed the original document; or |
(b) | believes that the original document, or the Electronic Record of it, was altered, without the approval of the signatory, after the signatory signed the original document; or |
(c) | otherwise doubts the authenticity of the Electronic Record of the document |
and the recipient promptly gives notice to the sender setting the grounds of its objection. If the recipient invokes this Article, the sender may seek to establish the authenticity of the Electronic Record in any way the sender thinks fit.
31 | Transfer by way of continuation |
31.1 | The Company may, by Special Resolution, resolve to be registered by way of continuation in a jurisdiction outside: |
(a) | the Islands; or |
(b) | such other jurisdiction in which it is, for the time being, incorporated, registered or existing. |
31.2 | To give effect to any resolution made pursuant to the preceding Article, the directors may cause the following: |
(a) | an application be made to the Registrar of Companies to deregister the Company in the Islands or in the other jurisdiction in which it is for the time being incorporated, registered or existing; and |
(b) | all such further steps as they consider appropriate to be taken to effect the transfer by way of continuation of the Company. |
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32 | Winding up |
Distribution of assets in specie
32.1 | If the Company is wound up, the Members may, subject to these Articles and any other sanction required by the Act, pass a Special Resolution allowing the liquidator to do either or both of the following: |
(a) | to divide in specie among the Members the whole or any part of the assets of the Company and, for that purpose, to value any assets and to determine how the division shall be carried out as between the Members or different classes of Members; |
(b) | to vest the whole or any part of the assets in trustees for the benefit of Members and those liable to contribute to the winding up. |
No obligation to accept liability
32.2 | No Member shall be compelled to accept any assets if an obligation attaches to them. |
The directors are authorised to present a winding up petition
32.3 | The directors have the authority to present a petition for the winding up of the Company to the Grand Court of the Cayman Islands on behalf of the Company without the sanction of a resolution passed at a general meeting. |
33 | Amendment of Memorandum and Articles |
Power to change name or amend Memorandum
33.1 | Subject to the Act, the Company may, by Special Resolution: |
(a) | change its name; or |
(b) | change the provisions of its Memorandum with respect to its objects, powers or any other matter specified in the Memorandum. |
Power to amend these Articles
33.2 | Subject to the Act and as provided in these Articles, the Company may, by Special Resolution, amend these Articles in whole or in part. |
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Dated 11 March 2024
Name and address of Subscriber | Number of shares taken |
Signature |
Ogier Global Subscriber (Cayman) Limited 89 Nexus Way Camana Bay Grand Cayman, KY1-9009 Cayman Islands |
1 Class B ordinary share of par value US$0.0001 |
per: ____________________________________ Name: Authorised Signatory |
Witness to above signature |
_____________________________________ Name:
Ogier Global (Cayman) Limited 89 Nexus Way Camana Bay Grand Cayman, KY1-9009 Cayman Islands
Occupation: Administrator |
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Exhibit 5.2
Melar Acquisition Corp. I 119 West 23rd Street, Suite 206 New York, New York 10011 United States |
D +1 345 815 1877 | |
E bradley.kruger@ogier.com | ||
Reference: 507984.00001 | ||
10 June 2024 |
Melar Acquisition Corp. I (the Company)
We have been requested to provide you with an opinion on matters of Cayman Islands law in connection with the Company’s registration statement on Form S-1, including all amendments or supplements thereto, filed with the United States Securities and Exchange Commission (the Commission) under the United States Securities Act of 1933 (the Act), as amended, (including its exhibits, the Registration Statement) related to the offering and sale of:
(a) | up to 15,000,000 units (together, the Units), each Unit consisting of one class A ordinary share of the Company with a par value of US$0.0001 each (the Class A Ordinary Shares) and one-half of one redeemable warrant, each whole warrant entitling the holder thereof to purchase one Class A Ordinary Share (the Warrants); |
(b) | up to 2,250,000 Units (the Over-Allotment Units) which several underwriters, for whom Cohen & Company Capital Markets, a division of J.V.B. Financial Group, LLC, and Seaport Global Securities LLC are acting as representatives, will have a right to purchase from the Company to cover over-allotments, if any; |
(c) | all Class A Ordinary Shares and all Warrants issued as part of the Units and the Over-Allotment Units; and |
(d) | all Class A Ordinary Shares that may be issued upon exercise of the Warrants included in the Units and the Over-Allotment Units. |
Ogier (Cayman) LLP 89 Nexus Way Camana Bay Grand Cayman, KY1-9009 Cayman Islands
T +1 345 949 9876 F +1 345 949 9877 ogier.com |
A list of Partners may be inspected on our website |
GCMLAW-14731943
Melar Acquisition Corp. I
10 June 2024
This opinion is given in accordance with the terms of the Legal Matters section of the Registration Statement.
Unless a contrary intention appears, all capitalised terms used in this opinion have the respective meanings set forth in Schedule 1. A reference to a Schedule is a reference to a schedule to this opinion and the headings herein are for convenience only and do not affect the construction of this opinion.
1 | Documents examined |
For the purposes of giving this opinion, we have examined the corporate and other documents and conducted the searches listed in Schedule 1. We have not made any searches or enquiries concerning, and have not examined any documents entered into by or affecting the Company or any other person, save for the searches, enquiries and examinations expressly referred to in Schedule 1.
2 | Assumptions |
In giving this opinion we have relied upon the assumptions set forth in Schedule 2 without having carried out any independent investigation or verification in respect of those assumptions.
3 | Opinions |
On the basis of the examinations and assumptions referred to above and subject to the qualifications set forth in Schedule 3 and the limitations set forth below, we are of the opinion that:
Corporate status
(a) | The Company has been duly incorporated as an exempted company with limited liability and is validly existing and in good standing with the Registrar of Companies of the Cayman Islands (the Registrar). |
Corporate power
(b) | The Company has all requisite power under its memorandum and articles of association to issue the Class A Ordinary Shares (including the issuance of the Class A Ordinary Shares upon the exercise of the Warrants in accordance with the Warrant Documents), to execute and deliver the Documents and to perform its obligations, and exercise its rights, under such documents. |
2 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
Corporate authorisation
(c) | The Company has taken all requisite corporate action to authorise: |
(i) | the issuance of the Class A Ordinary Shares (including the issuance of the Class A Ordinary Shares upon the exercise of the Warrants in accordance with the Warrant Documents); and |
(ii) | the execution and delivery of the Documents and the performance of its obligations, and the exercise of its rights, under such documents. |
Shares
(d) | The Class A Ordinary Shares to be offered and issued by the Company as contemplated by the Registration Statement (including the issuance of the Class A Ordinary Shares upon the exercise of the Warrants in accordance with the Warrant Documents), when issued by the Company upon: |
(i) | payment in full of the consideration as set out in the Registration Statement and in accordance with the terms set out in the Registration Statement (including the issuance of the Class A Ordinary Shares upon the exercise of the Warrants in accordance with the Warrant Documents) and in accordance with the Company's memorandum and articles of association; and |
(ii) | the entry of those Class A Ordinary Shares as fully paid on the register of members of the Company, |
shall be validly issued, fully paid and non-assessable.
4 | Matters not covered |
We offer no opinion:
(a) | as to any laws other than the laws of the Cayman Islands, and we have not, for the purposes of this opinion, made any investigation of the laws of any other jurisdiction, and we express no opinion as to the meaning, validity, or effect of references in the Documents to statutes, rules, regulations, codes or judicial authority of any jurisdiction other than the Cayman Islands; |
(b) | except to the extent that this opinion expressly provides otherwise, as to the commercial terms of, or the validity, enforceability or effect of the documents reviewed (or as to how the commercial terms of such documents reflect the intentions of the parties), the accuracy of representations, the fulfilment of warranties or conditions, the occurrence of events of default or terminating events or the existence of any conflicts or inconsistencies among the documents and any other agreements into which the Company may have entered or any other documents; or |
3 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
(c) | as to whether the acceptance, execution or performance of the Company’s obligations under the documents reviewed by us will result in the breach of or infringe any other agreement, deed or document (other than, to the extent expressly provided herein, the Company’s memorandum and articles of association) entered into by or binding on the Company. |
5 | Governing law of this opinion |
5.1 | This opinion is: |
(a) | governed by, and shall be construed in accordance with, the laws of the Cayman Islands; |
(b) | limited to the matters expressly stated in it; and |
(c) | confined to, and given on the basis of, the laws and practice in the Cayman Islands at the date of this opinion. |
5.2 | Unless otherwise indicated, a reference to any specific Cayman Islands legislation is a reference to that legislation as amended to, and as in force at, the date of this opinion. |
6 | Consent |
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and also consent to the reference to this firm in the Registration Statement under the heading “Legal Matters”. In the giving of our consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission thereunder.
Yours faithfully
/s/ Ogier'
4 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
Schedule 1
Documents examined
1 | The Certificate of Incorporation of the Company dated 11 March 2024 issued by the Registrar. |
2 | The memorandum of association of the Company filed with the Registrar on 11 March 2024. |
3 | The articles of association of the Company filed with the Registrar on 11 March 2024 (the Articles of Association). |
4 | The draft amended and restated memorandum and articles of association of the Company appended to the Registration Statement (the A&R M&A). |
5 | A Certificate of Good Standing dated 31 May 2024 (the Good Standing Certificate) issued by the Registrar in respect of the Company. |
6 | A certificate dated on the date hereof as to certain matters of fact signed by a director of the Company in the form annexed hereto (the Director’s Certificate), having attached to it a copy of the written resolutions of the directors of the Company passed on 11 March 2024 and 7 June 2024 (the Resolutions). |
7 | The Register of Writs maintained by the office of the Clerk of Courts in the Cayman Islands as inspected by us on 7 June 2024 (the Register of Writs). |
8 | The Registration Statement. |
9 | A draft of the form of the unit certificate representing the Units and the Over-Allotment Units (the Unit Certificates). |
10 | A draft specimen certificate for Class A Ordinary Shares (the Share Certificates). |
11 | A draft of the form of the warrant agreement and the warrant certificate constituting the Warrants (the Warrant Documents and, together with the Unit Certificates and the Share Certificates, the Documents). |
5 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
Schedule 2
Assumptions
Assumptions of general application
1 | All original documents examined by us are authentic and complete. |
2 | All copy documents examined by us (whether in facsimile, electronic or other form) conform to the originals and those originals are authentic and complete. |
3 | All signatures, seals, dates, stamps and markings (whether on original or copy documents) are genuine. |
4 | Each of the Good Standing Certificate and the Director’s Certificate is accurate and complete as at the date of this opinion. |
5 | Where any Document has been provided to us in draft or undated form, that Document has been executed by all parties in materially the form provided to us and, where we have been provided with successive drafts of a Document marked to show changes from a previous draft, all such changes have been accurately marked. |
Status, authorisation and execution
6 | Each of the parties to the Documents other than the Company is duly incorporated, formed or organised (as applicable), validly existing and in good standing under all relevant laws. |
7 | Each Document has been duly authorised, executed and unconditionally delivered by or on behalf of all parties to it in accordance with all applicable laws (other than, in the case of the Company, the laws of the Cayman Islands). |
8 | In authorising the execution and delivery of the Documents by the Company, the exercise of its rights and performance of its obligations under the Documents, each of the directors of the Company has acted in good faith with a view to the best interests of the Company and has exercised the standard of care, diligence and skill that is required of him or her. |
9 | Each Document has been duly executed and unconditionally delivered by the Company in the manner authorised in the Resolutions. |
Enforceability
10 | None of the opinions expressed herein will be adversely affected by the laws or public policies of any jurisdiction other than the Cayman Islands. In particular, but without limitation to the previous sentence: |
(a) | the laws or public policies of any jurisdiction other than the Cayman Islands will not adversely affect the capacity or authority of the Company; and |
6 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
(b) | neither the execution or delivery of the Documents nor the exercise by any party to the Documents of its rights or the performance of its obligations under them contravene those laws or public policies. |
11 | There are no agreements, documents or arrangements (other than the documents expressly referred to in this opinion as having been examined by us) that materially affect or modify the Documents or the transactions contemplated by them or restrict the powers and authority of the Company in any way. |
12 | None of the transactions contemplated by the Documents relate to any shares, voting rights or other rights that are subject to a restrictions notice issued pursuant to the Companies Act (Revised) of the Cayman Islands (the Companies Act). |
Share Issuance
13 | The Class A Ordinary Shares shall be issued at an issue price in excess of the par value thereof. |
14 | The A&R M&A will be adopted by the Company in accordance with the Articles of Association prior to the date that any Units, Class A Ordinary Shares, Warrants, or Over-Allotment Units are issued by the Company. |
7 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
Schedule 3
Qualifications
Good Standing
1 | Under the Companies Act annual returns in respect of the Company must be filed with the Registrar, together with payment of annual filing fees. A failure to file annual returns and pay annual filing fees may result in the Company being struck off the Register of Companies, following which its assets will vest in the Financial Secretary of the Cayman Islands and will be subject to disposition or retention for the benefit of the public of the Cayman Islands. |
2 | In good standing means only that as of the date of the Good Standing Certificate the Company is up-to-date with the filing of its annual returns and payment of annual fees with the Registrar. We have made no enquiries into the Company's good standing with respect to any filings or payment of fees, or both, that it may be required to make under the laws of the Cayman Islands other than the Companies Act. |
Limited Liability
3 | We are not aware of any Cayman Islands authority as to when the courts would set aside the limited liability of a shareholder in a Cayman Islands company. Our opinion on the subject is based on the Companies Act and English common law authorities, the latter of which are persuasive but not binding in the courts of the Cayman Islands. Under English authorities, circumstances in which a court would attribute personal liability to a shareholder are very limited, and include: (a) such shareholder expressly assuming direct liability (such as a guarantee); (b) the company acting as the agent of such shareholder; and (c) the company being incorporated by or at the behest of such shareholder for the purpose of committing or furthering such shareholder’s fraud, or for a sham transaction otherwise carried out by such shareholder. In the absence of these circumstances, we are of the opinion that a Cayman Islands’ court would have no grounds to set aside the limited liability of a shareholder. |
Non-Assessable
4 | In this opinion, the phrase “non-assessable” means, with respect to the Class A Ordinary Shares in the Company, that a shareholder shall not, solely by virtue of its status as a shareholder, be liable for additional assessments or calls on the Class A Ordinary Shares by the Company or its creditors (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstance in which a court may be prepared to pierce or lift the corporate veil). |
Register of Writs
5 | Our examination of the Register of Writs cannot conclusively reveal whether or not there is: |
(a) | any current or pending litigation in the Cayman Islands against the Company; or |
8 | GCMLAW-14731943 |
Melar Acquisition Corp. I
10 June 2024
(b) | any application for the winding up or dissolution of the Company or the appointment of any liquidator, trustee in bankruptcy or restructuring officer in respect of the Company or any of its assets, |
as notice of these matters might not be entered on the Register of Writs immediately or updated expeditiously or the court file associated with the matter or the matter itself may not be publicly available (for example, due to sealing orders having been made). Furthermore, we have not conducted a search of the summary court. Claims in the summary court are limited to a maximum of CI $20,000.
9 | GCMLAW-14731943 |
Exhibit 10.7
THIS PROMISSORY NOTE (“NOTE”) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF REGISTRATION OF THE RESALE THEREOF UNDER THE SECURITIES ACT OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
PROMISSORY NOTE
Principal Amount: Up to $300,000 |
Dated as of March 11, 2024 New York, New York |
Melar Acquisition Corp. I, a Cayman Islands exempted company and blank check company (the “Maker”), promises to pay to the order of Melar Acquisition Sponsor I LLC or its registered assigns or successors in interest (the “Payee”), or order, the principal sum of up to Three Hundred Thousand Dollars ($300,000) in lawful money of the United States of America, on the terms and conditions described below. All payments on this Note shall be made by check or wire transfer of immediately available funds or as otherwise determined by the Maker to such account as the Payee may from time to time designate by written notice in accordance with the provisions of this Note.
1. Principal. The principal balance of this Note shall be payable by the Maker on the earlier of: (i) December 31, 2024 or (ii) the date on which Maker consummates an initial public offering of its securities (the “IPO”). The principal balance may be prepaid at any time. Under no circumstances shall any individual, including but not limited to any officer, director, employee or shareholder of the Maker, be obligated personally for any obligations or liabilities of the Maker hereunder.
2. Interest. No interest shall accrue on the unpaid principal balance of this Note.
3. Drawdown Requests. Maker and Payee agree that Maker may request up to Three Hundred Thousand Dollars ($300,000) for costs reasonably related to Maker’s IPO. The principal of this Note may be drawn down from time to time prior to the earlier of: (i) December 31, 2024 or (ii) the date on which Maker consummates an IPO, upon written request from Maker to Payee (each, a “Drawdown Request”). Each Drawdown Request must state the amount to be drawn down, and must not be an amount less than Ten Thousand Dollars ($10,000) unless agreed upon by Maker and Payee. Payee shall fund each Drawdown Request no later than five (5) business days after receipt of a Drawdown Request; provided, however, that the maximum amount of drawdowns collectively under this Note is Three Hundred Thousand Dollars ($300,000). Once an amount is drawn down under this Note, it shall not be available for future Drawdown Requests even if prepaid. No fees, payments or other amounts shall be due to Payee in connection with, or as a result of, any Drawdown Request by Maker. Notwithstanding the foregoing, all payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under this Note, including (without limitation) reasonable attorneys’ fees, and then to the reduction of the unpaid principal balance of this Note.
4. Application of Payments. All payments shall be applied first to payment in full of any costs incurred in the collection of any sum due under this Note, including (without limitation) reasonable attorney’s fees, then to the payment in full of any late charges and finally to the reduction of the unpaid principal balance of this Note.
5. Events of Default. The following shall constitute an event of default (“Event of Default”):
(a) Failure to Make Required Payments. Failure by Maker to pay the principal amount due pursuant to this Note within five (5) business days of the date specified above.
(b) Voluntary Bankruptcy, Etc. The commencement by Maker of a voluntary case under any applicable bankruptcy, insolvency, reorganization, rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, restructuring officer (or other similar official) of Maker or for any substantial part of its property, or the making by it of any assignment for the benefit of creditors, or the failure of Maker generally to pay its debts as such debts become due, or the taking of corporate action by Maker in furtherance of any of the foregoing.
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(c) Involuntary Bankruptcy, Etc. The entry of a decree or order for relief by a court having jurisdiction in the premises in respect of Maker in an involuntary case under any applicable bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator, restructuring officer (or similar official) of Maker or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of sixty (60) consecutive days.
6. Remedies.
(a) Upon the occurrence of an Event of Default specified in Section 5(a) hereof, Payee may, by written notice to Maker, declare this Note to be due immediately and payable, whereupon the unpaid principal amount of this Note, and all other amounts payable hereunder, shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.
(b) Upon the occurrence of an Event of Default specified in Sections 5(b) and 5(c), the unpaid principal balance of this Note, and all other sums payable with regard to this Note, shall automatically and immediately become due and payable, in all cases without any action on the part of Payee.
7. Waivers. Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice of dishonor, protest, and notice of protest with regard to the Note, all errors, defects and imperfections in any proceedings instituted by Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting any property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and Maker agrees that any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof or any writ of execution issued hereon, may be sold upon any such writ in whole or in part in any order desired by Payee.
8. Unconditional Liability. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default, or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by Payee with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors, or sureties may become parties hereto without notice to Maker or affecting Maker’s liability hereunder.
9. Notices. All notices, statements or other documents which are required or contemplated by this Note shall be made in writing and delivered: (i) personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party or (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.
10. Construction. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.
11. Severability. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
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12. Trust Waiver. Notwithstanding anything herein to the contrary, the Payee hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of or from the trust account to be established in which the proceeds of the IPO to be conducted by the Maker (including the deferred underwriters discounts and commissions) and the proceeds of the sale of the warrants to be issued in a private placement to occur prior to the closing of the IPO are to be deposited, as described in greater detail in the registration statement and prospectus to be filed with the Securities and Exchange Commission in connection with the IPO, and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the trust account for any reason whatsoever.
13. Amendment; Waiver. Any amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent of the Maker and the Payee.
14. Assignment. No assignment or transfer of this Note or any rights or obligations hereunder may be made by any party hereto (by operation of law or otherwise) without the prior written consent of the other party hereto and any attempted assignment without the required consent shall be void.
[Signature page follows]
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IN WITNESS WHEREOF, Maker, intending to be legally bound hereby, has caused this Note to be duly executed by the undersigned as of the day and year first above written.
MELAR ACQUISITION CORP. I |
By: | /s/ Gautam Ivatury | |
Name: Gautam Ivatury | ||
Title: Director |
[Signature Page to IPO Promissory Note]
Exhibit 10.8
Melar Acquisition Corp. I
119 West 23rd Street, Suite 206
New York, New York 10011
March 11, 2024
Melar Acquisition Sponsor I LLC
119 West 23rd Street, Suite 206
New York, New York 10011
RE: | Securities Subscription Agreement |
Ladies and Gentlemen:
Melar Acquisition Corp. I, a Cayman Islands exempted company (the “Company”), is pleased to accept the offer Melar Acquisition Sponsor I LLC, a Delaware limited liability company, (the “Subscriber” or “you”) has made to subscribe for 6,060,811 Class B ordinary shares of the Company (the “Shares”), US$0.0001 par value per share (the “Class B Ordinary Shares”), up to 790,541 of which are subject to complete or partial forfeiture by you if the underwriters of the Company’s initial public offering (“IPO”) of units do not fully exercise their over-allotment option (the “Over-allotment Option”). For the purposes of this Agreement, references to “Ordinary Shares” are to, collectively, the Class B Ordinary Shares and the Company’s Class A ordinary shares, US$0.0001 par value per share (the “Class A Ordinary Shares”). Pursuant to the Company’s memorandum and articles of association (as may be amended, the “Articles”), Class B Ordinary Shares will convert into Class A Ordinary Shares on a one-for-one basis, subject to adjustment, upon and subject to the terms and conditions set forth in the Articles. Unless the context otherwise requires, as used herein “Shares” shall be deemed to include any Class A Ordinary Shares issued upon conversion of the Class B Ordinary Shares comprising the Shares. The terms (this “Agreement”) on which the Company is willing to issue the Shares to the Subscriber, and the Company and the Subscriber’s agreements regarding such Shares, are as follows:
1. Subscription for Shares.
For the sum of US$25,000, which the Company acknowledges receiving in cash, the Company hereby agrees to issue the Shares to the Subscriber, and the Subscriber hereby subscribes for the Shares from the Company, subject to forfeiture, on the terms and subject to the conditions set forth in this Agreement. Concurrently with the Subscriber’s execution of this Agreement, the Company shall update its register of members accordingly. All references in this Agreement to shares of the Company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. The one Class B Ordinary Share currently held by the Subscriber following the incorporation of the Company shall be repurchased by the Company at par immediately following the issue of the Shares by the Company.
2. Representations, Warranties and Agreements.
2.1 Subscriber’s Representations, Warranties and Agreements. To induce the Company to issue the Shares to the Subscriber, the Subscriber hereby represents and warrants to the Company and agrees with the Company as follows:
2.1.1 No Government Recommendation or Approval. The Subscriber understands that no federal or state agency has passed upon or made any recommendation or endorsement of the offering of the Shares.
2.1.2 No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the limited liability company agreement of the Subscriber, (ii) any agreement, indenture or instrument to which the Subscriber is a party or (iii) any law, statute, rule or regulation to which the Subscriber is subject, or any agreement, order, judgment or decree to which the Subscriber is subject.
2.1.3 Formation and Authority. The Subscriber is a Delaware limited liability company, formed and registered and validly existing and in good standing under the laws of Delaware and possesses all requisite power and authority necessary to carry out the transactions contemplated by this Agreement. Upon execution and delivery by you, this Agreement is a legal, valid and binding agreement of the Subscriber, enforceable against the Subscriber in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
2.1.4 Experience, Financial Capability and Suitability. The Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Shares and (ii) able to bear the economic risk of its investment in the Shares for an indefinite period of time because the Shares have not been registered under the Securities Act (as defined below) and therefore cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available. The Subscriber is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests. The Subscriber must bear the economic risk of this investment until the Shares are sold pursuant to: (i) an effective registration statement under the Securities Act or (ii) an exemption from registration available with respect to such sale. The Subscriber is able to bear the economic risks of an investment in the Shares and to afford a complete loss of the Subscriber’s investment in the Shares.
2.1.5 Access to Information; Independent Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as the finances, operations, business and prospects of the Company, and the opportunity to obtain additional information to verify the accuracy of all information so obtained. In determining whether to make this investment, the Subscriber has relied solely on the Subscriber’s own knowledge and understanding of the Company and its business based upon the Subscriber’s own due diligence investigation and the information furnished pursuant to this paragraph. The Subscriber understands that no person has been authorized to give any information or to make any representations which were not furnished pursuant to this Section 2 and the Subscriber has not relied on any other representations or information in making its investment decision, whether written or oral, relating to the Company, its operations and/or its prospects.
2.1.6 Regulation D Offering. The Subscriber represents that it is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and acknowledges the sale contemplated hereby is being made in reliance on a private placement exemption to “accredited investors” within the meaning of Section 501(a) of Regulation D under the Securities Act or similar exemptions under state law.
2.1.7 Investment Purposes. The Subscriber is purchasing the Shares solely for investment purposes, for the Subscriber’s own account and not for the account or benefit of any other person, and not with a view towards the distribution or dissemination thereof. The Subscriber did not decide to enter into this Agreement as a result of any general solicitation or general advertising within the meaning of Rule 502 under the Securities Act.
2.1.8 Restrictions on Transfer; Shell Company. The Subscriber understands the Shares are being offered in a transaction not involving a public offering within the meaning of the Securities Act. The Subscriber understands the Shares will be “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act and the Subscriber understands that the certificates or book-entries representing the Shares will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer, resell, pledge or otherwise transfer the Shares, such Shares may be offered, resold, pledged or otherwise transferred only pursuant to: (i) registration under the Securities Act, or (ii) an available exemption from registration. The Subscriber agrees that if any transfer of its Shares or any interest therein is proposed to be made, as a condition precedent to any such transfer, the Subscriber may be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or an exemption, the Subscriber agrees not to resell the Shares. The Subscriber further acknowledges that because the Company is a shell company, Rule 144 may not be available to the Subscriber for the resale of the Shares until one year following consummation of the initial business combination of the Company, despite technical compliance with the requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.
2.1.9 No Governmental Consents. No governmental, administrative or other third party consents or approvals are required, necessary or appropriate on the part of the Subscriber in connection with the transactions contemplated by this Agreement.
2.2 Company’s Representations, Warranties and Agreements. To induce the Subscriber to purchase the Shares, the Company hereby represents and warrants to the Subscriber and agrees with the Subscriber as follows:
2.2.1 Incorporation and Corporate Power. The Company is a Cayman Islands exempted company and is qualified to do business in every jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on the financial condition, operating results or assets of the Company. The Company possesses all requisite corporate power and authority necessary to carry out the transactions contemplated by this Agreement.
2.2.2 No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the Articles, (ii) any agreement, indenture or instrument to which the Company is a party or (iii) any law, statute, rule or regulation to which the Company is subject, or any agreement, order, judgment or decree to which the Company is subject.
2.2.3 Title to Shares. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Articles, and registration in the register of members of the Company, the Shares will be duly and validly issued as fully paid and nonassessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Articles the Subscriber will have or receive good title to the Shares, free and clear of all liens, claims and encumbrances of any kind, other than (a) transfer restrictions hereunder under the Articles and under the other agreements to which the Shares may be subject, (b) transfer restrictions under federal and state securities laws, and (c) liens, claims or encumbrances imposed due to the actions of the Subscriber.
2.2.4 No Adverse Actions. There are no actions, suits, investigations or proceedings pending, threatened against or affecting the Company which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement or (ii) question the validity or legality of any transactions or seeks to recover damages or to obtain other relief in connection with any transactions.
2.2.4 Authorization. The Class A Ordinary Shares issuable upon conversion of the Class B Ordinary Shares have been duly authorized and reserved for issuance upon such conversion.
3. Forfeiture of Shares.
3.1 Partial or No Exercise of the Over-allotment Option. In the event the Over-allotment Option granted to the underwriters of the IPO is not exercised in full, the Subscriber acknowledges and agrees that it (and, if applicable, any transferee of Shares) shall automatically forfeit any and all rights to such number of Shares (up to an aggregate of 790,541 Shares and pro rata based upon the percentage of the Over-allotment Option exercised) such that immediately following such forfeiture, the Subscriber (and any such transferees) will own an aggregate number of Shares (not including Class A Ordinary Shares issuable upon exercise of any private placement warrants or any securities purchased by Subscriber in the IPO or in the aftermarket) equal to 26.0% of the issued and outstanding Ordinary Shares immediately following the IPO.
3.2 Termination of Rights as Shareholder. If any of the Shares are forfeited in accordance with this Section 3, then after such time the Subscriber (or successor in interest), shall no longer have any rights as a holder of such forfeited Shares, and the Company shall take such action as is appropriate to cancel such forfeited Shares.
4. Waiver of Liquidation Distributions; Redemption Rights.
In connection with the Shares purchased pursuant to this Agreement, the Subscriber hereby waives any and all right, title, interest or claim of any kind in or to any distributions by the Company from the trust account which will be established for the benefit of the Company’s public shareholders and into which substantially all of the proceeds of the IPO will be deposited (the “Trust Account”), in the event of a liquidation of the Company upon the Company’s failure to timely complete an initial business combination. For purposes of clarity, in the event the Subscriber purchases securities in the IPO or in the aftermarket, any Class A Ordinary Shares so purchased (the “Public Shares”) shall be eligible to receive any liquidating distributions by the Company. However, in no event will the Subscriber have the right to redeem any Ordinary Shares held by it in exchange for funds held in the Trust Account except Public Shares redeemed by the Company in the event of a liquidation of the Company upon the Company’s failure to timely complete an initial business combination.
5. Restrictions on Transfer.
5.1 Securities Law Restrictions. In addition to any restrictions to be contained in that certain letter agreement (commonly known as an “Insider Letter”) dated on or prior to the closing of the IPO by and between the Subscriber and the Company, the Subscriber agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Shares unless, prior thereto (a) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with respect to the Shares proposed to be transferred shall then be effective or (b) the Company has received an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction is exempt from registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder and with all applicable state securities laws.
5.2 Lock-up. The Subscriber acknowledges that the Shares will be subject to lock-up provisions (the “Lock-up”) contained in the Insider Letter.
5.3 Restrictive Legends. All certificates representing the Shares shall have endorsed thereon legends substantially as follows:
“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL, IS AVAILABLE.”
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE LOCKUP.”
5.4 Additional Shares or Substituted Securities. In the event of the declaration of a share capitalization, the declaration of an extraordinary dividend payable in a form other than Ordinary Shares, a spin-off, a share sub-division, a share consolidation, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company’s outstanding Ordinary Shares without receipt of consideration, any new, substituted or additional securities or other property which are by reason of such transaction distributed with respect to any Shares subject to this Section 5 or into which such Shares thereby become convertible shall immediately be subject to this Section 5 and Section 3. Appropriate adjustments to reflect the distribution of such securities or property shall be made to the number and/or class of Ordinary Shares subject to this Section 5 and Section 3.
5.5 Registration Rights. The Subscriber acknowledges that the Shares are being purchased pursuant to an exemption from the registration requirements of the Securities Act and will become freely tradable only after certain conditions are met or they are registered pursuant to a registration rights agreement to be entered into with the Company prior to the closing of the IPO (the “Registration Rights Agreement”).
6. Other Agreements.
6.1 Further Assurances. The Subscriber agrees to execute such further instruments and to take such further action as may reasonably be necessary to carry out the intent of this Agreement.
6.2 Notices. All notices, statements or other documents which are required or contemplated by this Agreement shall be: (i) in writing and delivered personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.
6.3 Entire Agreement. This Agreement, together with that certain Insider Letter to be entered into between the Subscriber and the Company and the Registration Rights Agreement, each substantially in the form to be filed as an exhibit to the Registration Statement, embodies the entire agreement and understanding between the Subscriber and the Company with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof.
6.4 Modifications and Amendments. The terms and provisions of this Agreement may be modified or amended only by written agreement executed by all parties hereto.
6.5 Waivers and Consents. The terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a continuing waiver or consent.
6.6 Assignment. The rights and obligations under this Agreement may not be assigned by either party hereto without the prior written consent of the other party.
6.7 Benefit. All statements, representations, warranties, covenants and agreements in this Agreement shall be binding on the parties hereto and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing in this Agreement shall be construed to create any rights or obligations except among the parties hereto, and no person or entity shall be regarded as a third-party beneficiary of this Agreement.
6.8 Governing Law. This Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with and governed by the laws of New York applicable to contracts wholly performed within the borders of such state, without giving effect to the conflict of law principles thereof.
6.9 Severability. In the event that any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent that such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. In the event that such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this Agreement shall nevertheless remain in full force and effect.
6.10 No Waiver of Rights, Powers and Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further action in any circumstances without such notice or demand.
6.11 Survival of Representations and Warranties. All representations and warranties made by the parties hereto in this Agreement or in any other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof and any investigations made by or on behalf of the parties.
6.12 No Broker or Finder. Each of the parties hereto represents and warrants to the other that no broker, finder or other financial consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to create any liability on the other. Each of the parties hereto agrees to indemnify and save the other harmless from any claim or demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been employed by or on behalf of such party and to bear the cost of legal expenses incurred in defending against any such claim.
6.13 Headings and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference only and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.
6.14 Counterparts. This Agreement may be executed in one or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or any other form of electronic delivery, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.
6.15 Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties hereto and no presumption or burden of proof will arise favoring or disfavoring any party hereto because of the authorship of any provision of this Agreement. The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party hereto has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty, or covenant.
6.16 Mutual Drafting. This Agreement is the joint product of the Subscriber and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.
7. Voting and Tender of Shares.
The Subscriber agrees to vote the Shares in favor of an initial business combination that the Company negotiates and submits for approval to the Company’s shareholders and shall not seek repurchase or redemption with respect to any of the Shares. Additionally, the Subscriber agrees not to tender any Shares in connection with a tender offer presented to the Company’s shareholders in connection with an initial business combination negotiated by the Company.
8. Indemnification.
Each party shall indemnify the other against any loss, cost or damages (including reasonable attorney’s fees and expenses) incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in this Agreement.
[Signature Page Follows]
If the foregoing accurately sets forth our understanding and agreement, please sign the enclosed copy of the Agreement and return it to us.
Very truly yours, | |
MELAR ACQUISITION CORP. I |
By: | /s/ Gautam Ivatury | |
Name: Gautam Ivatury | ||
Title: Director |
Accepted and agreed, March 11, 2024
Melar Acquisition Sponsor I LLC |
By: | /s/ Gautam Ivatury | |
Name: Gautam Ivatury | ||
Title: Authorized Signatory |
[Signature page to Founder Share Subscription Agreement]
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We hereby consent to the use in the Prospectus constituting a part of this Registration Statement on Amendment No. 1 to Form S-1 of our report dated May 13, 2024, relating to the financial statements of Melar Acquisition Corp. I, as of March 31, 2024 and for the period from March 11, 2024 (inception) through March 31, 2024, which is contained in that Prospectus. We also consent to the reference to our firm under the caption “Experts” in the Prospectus.
/s/ WithumSmith+Brown, PC
New York, New York
June 10, 2024