EX-10.5



 




Exhibit 10.5




MARKET STREET ACQUISITION CORP.




WARRANT SUBSCRIPTION AGREEMENT




     THIS SUBSCRIPTION AGREEMENT (this “Agreement”) is made as of the 27th day of February,
2008, by and between Market Street Acquisition Corp., a Delaware corporation (the
“Company”), and Hayground Cove Asset Management LLC, a Delaware limited liability company
(“Purchaser”).



     WHEREAS, the Company desires to commit to issue and sell, and Purchaser desires to commit to
purchase and acquire, Warrants (each as defined herein) on the terms and conditions hereinafter set
forth;



     NOW, THEREFORE, for and in consideration of the promises and mutual covenants set forth
herein, it is agreed between the parties as follows:



     1. Commitment To Purchase Warrants. Subject to and immediately prior to the consummation of
the Company’s initial public offering (the “IPO”), Purchaser hereby agrees to subscribe for
and purchase from the Company, and the Company hereby agrees to issue and sell to Purchaser, Nine
Million Seven Hundred Thousand (9,700,000) Warrants (the “Warrants”) at a purchase price of
$1.00 per Warrant for an aggregate purchase price of $9,700,000. Each Warrant shall entitle the holder
thereof to purchase one share of common stock, par value $0.0001 per share, of the Company
(“Common Stock”) at an exercise price of $7.50 and in accordance with other terms to be
reasonably agreed upon by and between the Company and Continental Stock Transfer & Trust Company,
as warrant agent, and set forth in a warrant agreement between such parties prior to the
consummation of the IPO (the “Warrant Agreement”). The closing of the purchase and sale of
the Warrants hereunder, including payment for and delivery of the Warrants, shall occur at the
offices of the Company or the Company’s legal counsel immediately prior to, and subject to consummation of, the IPO.



     2. Payment of Purchase Price. The purchase price for the Warrants shall be tendered in full at
the closing (the “Closing”) by one or a combination of the following means:



          (a) wiring of immediately available United States funds to an account for the benefit of the
Company, pursuant to wire instructions provided by the Company in advance; or




          (b) by delivery of a cashiers check to the Company of immediately available United States
funds.




     3. Acceptance or Rejection of Agreement. The Company has the right to reject this Agreement
and any subscription for the Warrants represented hereby in whole or in part, for any reason and at
any time prior to a closing, notwithstanding receipt by Purchaser or prior notice of acceptance of
such subscription. The Warrants subscribed for herein will not be deemed issued to or owned by
Purchaser until a copy of this Agreement has been executed by the Company and Purchaser and a
closing with respect to such Warrants has occurred. In the event that a closing does not take place
for any reason with respect to some or all of the Warrants, all cash proceeds delivered by
Purchaser in accordance herewith with respect to such Warrants shall be returned to Purchaser as
soon as practicable, without interest, offset or deduction.




     4. Registration Rights. At the time of the closing of the IPO, the Company and the Purchaser
shall enter into a registration rights agreement pursuant to which the Company
will grant certain registration rights to the Purchaser relating to the
Warrants and the Common Stock issuable upon exercise of the Warrants.




     5. Limitations on Transfer. Purchaser shall not assign, hypothecate, donate, encumber or
otherwise dispose of any interest in the Warrants during the Lock-up Period. For purposes of this
provision, the “Lock-up Period” means the period between the Closing and the consummation
of a Business Combination (as defined below). Notwithstanding anything contrary to the foregoing,
Purchaser may assign or transfer its interest (a) in the Warrants among various funds under
Purchaser’s



 









 






management, at any time, for rebalancing purposes only, (b) in the Warrants to investors in
such funds, provided that such investors agree to be bound by a
lock-up agreement, and (c) in the Warrants to
Company’s directors and officers and/or employees
of the Purchaser, provided that such persons agree to be
bound by a lock-up agreement, or the case of an individual subject to
a lock-up agreement, transfer of interests in the Warrants to
relatives and trusts for estate planning purposes.



     6. Restrictive Legends. All certificates representing the Warrants (and any underlying
securities thereof) shall have endorsed thereon legends in substantially the following forms (in
addition to any other legend which may be required by other agreements between the parties hereto):



          (a) “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.”




          (b) “THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE ASSIGNED, HYPOTHECATED,
DONATED, ENCUMBERED, SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THAT
CERTAIN WARRANT SUBSCRIPTION AGREEMENT DATED ___, AND THAT CERTAIN WARRANT AGREEMENT DATED
___, COPIES OF WHICH ARE AVAILABLE FOR INSPECTION AT THE OFFICES OF THE COMPANY.”




          (c) Any legend required by appropriate blue sky officials.



      7. Forfeiture of Warrants.



          (a) All of the Warrants initially shall be subject to forfeiture to the Company in accordance
with this Section 7. The Warrants shall be forfeited to the Company in the event that the Company
does not consummate a Business Combination within 24 months after the closing of the IPO (or, if
the Company’s corporate existence and, accordingly, the time within which the Company may
consummate a Business Combination, is extended as set forth in the Company’s registration statement
on Form S-1, within up to 30 months after the closing of the IPO).



          (b) If the Warrants are forfeited in accordance with this Section 7, then after such time the
Purchaser purchasing such Warrants (or their respective successors in interest), shall no longer
have any rights as holders of such Warrants, and the Company shall take such action as is
appropriate to cancel such Warrants.



     8. Investment Representations. In connection with the purchase of the Warrants, Purchaser
represents to the Company the following:



          (a) Purchaser has been furnished with all materials relating to the Company’s business affairs
and financial condition and materials related to the offer and sale of the Warrants that have been
requested by Purchaser and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Warrants. Purchaser has been afforded the
opportunity to ask questions of the executive officer and director of the Company. Purchaser
understands that its investment in the Warrants involves a high degree of risk. Purchaser has
sought such accounting, legal and tax advice as Purchaser has considered necessary to make an
informed investment decision with respect to Purchaser’s acquisition of the Warrants. Purchaser has
such knowledge and expertise in financial and business matters, knows of the high degree of risk
associated with investments generally and particularly investments in the securities of companies
in the development stage such as the Company, is capable of evaluating the merits and risks of an
investment in the Warrants, and is able to bear the economic risk of an investment in the Warrants
in the amount contemplated hereunder. Purchaser has adequate means of providing for its current
financial needs and contingencies and will have no current or anticipated future needs for
liquidity which would be jeopardized by the investment in the Warrants. Purchaser can afford a
complete loss of its investment in the Warrants. Purchaser is purchasing the Warrants for
investment for Purchaser’s own account only and not with a view to, or for resale in connection
with, any “distribution” thereof within the meaning of the Securities Act of 1933, as amended (the
“Act”). Purchaser understands that the Company is a blank check development stage company
recently formed for the purpose of consummating an initial business combination (a “Business
Combination”) and understands that there is no assurance as to the future performance of the
Company and that the Company may never effectuate a Business Combination.




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          (b) Purchaser understands that the Warrants (and the securities underlying the Warrants) have
not been registered under the Act or any state securities law by reason of a specific exemption
therefrom, and that the Company is relying on the truth and accuracy of, and Purchaser’s compliance
with, the representations and warranties and agreements of Purchaser set forth herein to determine
the availability of such exemptions and the eligibility of Purchaser to acquire such Warrants,
including, but not limited to, the bona fide nature of Purchaser’s investment intent as expressed
herein.




          (c) Purchaser further acknowledges and understands that the Warrants (and the securities
underlying the Warrants) must be held indefinitely unless the Warrants (and the securities
underlying the Warrants) are subsequently registered under the Act or an exemption from such
registration is available. Purchaser understands that the certificates evidencing the Warrants (and
the securities underlying the Warrants) will be imprinted with a legend which prohibits the
transfer of the Warrants (and the securities underlying the Warrants) unless the Warrants (and the
securities underlying the Warrants) are registered or such registration is not required in the
opinion of counsel for the Company.




          (d) Purchaser is familiar with the provisions of Rule 144 under the Act, as in effect from
time to time (“Rule 144”), which, in substance, permit limited public resale of “restricted
securities” acquired, directly or indirectly, from the issuer thereof (or from an affiliate of such
issuer), in a non-public offering subject to the satisfaction of certain conditions. Unless the
Company registers the Warrants (and the securities underlying the Warrants) under the Act, the
Warrants (and the securities underlying the Warrants) may be resold by Purchaser only in certain
limited circumstances subject to the provisions of Rule 144, which requires, among other things:
(i) the availability of certain public information about the Company and (ii) the resale occurring
following the required holding period under Rule 144 after Purchaser has purchased, and made full
payment of (within the meaning of Rule 144), the securities to be sold.




          (e) Purchaser further understands that at the time Purchaser wishes to sell the Warrants there
may be no public market upon which to make such a sale, and that, even if such a public market then
exists, the Company may not be satisfying the current public information requirements of Rule 144,
and that, in such event, Purchaser would be precluded from selling the Warrants (and the securities
underlying the Warrants) under Rule 144 even if the minimum holding period requirement had been
satisfied. Notwithstanding Sections 7(d) and (e) hereof, Purchaser understands that he may be
considered a promoter of the Company and understands that it is the position of the Securities and
Exchange Commission (the “SEC”) that promoters or affiliates of a blank check company and
their transferees, both before and after a Business Combination, would act as an “underwriter”
under the Act when reselling the securities of a blank check company. Accordingly, the SEC believes
that those securities can be resold only through a registered offering and that Rule 144 would not
be available for those resale transactions despite technical compliance with the requirements of
Rule 144.




          (f) Purchaser represents that Purchaser is an “accredited investor” as that term is defined in
Rule 501 of Regulation D promulgated by the SEC under the Act.




          (g) Purchaser has all necessary limited liability company power and authority to enter into
this Agreement and to consummate the transactions contemplated hereby. All limited liability
company action necessary to be taken by Purchaser to authorize the execution, delivery and
performance of this Agreement and all other agreements and instruments delivered by Purchaser in
connection with the transactions contemplated hereby has been duly and validly taken, and this
Agreement has been duly executed and delivered by Purchaser. Subject to the terms and conditions of
this Agreement, this Agreement constitutes the valid, binding and enforceable obligation of
Purchaser, enforceable in accordance with its terms, except as enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or similar laws
of general application now or




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hereafter in effect affecting the rights and remedies of creditors and by general principles
of equity (regardless of whether enforcement is sought in a proceeding at law or in equity); and
(ii) the applicability of the federal and state securities laws and public policy as to the
enforceability of the indemnification provisions of this Agreement. The purchase by Purchaser of
the Warrants does not conflict with the organizational documents of Purchaser or with any material
contract by which Purchaser or its property is bound, or any laws or regulations or decree, ruling
or judgment of any court applicable to Purchaser or its property.




          (h) Purchaser did not decide to enter into this Agreement as a result of any general
solicitation or general advertising within the meaning of Rule 502(c) of the Act.




          (i) Purchaser understands that no United States federal or state agency or any other
government or governmental agency has passed on or made any recommendation or endorsement of the
Warrants or the fairness or suitability of the investment in the Warrants, nor have such
authorities passed upon or endorsed the merits of the offering of the Warrants.




     9. Company Representations and Warranties. The Company hereby represents and warrants to
Purchaser that the Company has all necessary corporate power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. All corporate action necessary to
be taken by the Company to authorize the execution, delivery and performance of this Agreement and
all other agreements and instruments delivered by the Company in connection with the transactions
contemplated hereby has been duly and validly taken and this Agreement has been duly executed and
delivered by the Company. Subject to the terms and conditions of this Agreement, this Agreement
constitutes the valid, binding and enforceable obligation of the Company, enforceable in accordance
with its terms, except as enforceability may be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer or similar laws of general application now or
hereafter in effect affecting the rights and remedies of creditors and by general principles of
equity (regardless of whether enforcement is sought in a proceeding at law or in equity); and (ii)
the applicability of the federal and state securities laws and public policy as to the
enforceability of the indemnification provisions of this Agreement. The sale by the Company of the
Warrants does not conflict with the certificate of incorporation or by-laws of the Company or any
material contract by which the Company or its property is bound, or any federal or state laws or
regulations or decree, ruling or judgment of any United States or state court applicable to the
Company or its property.



     10. Indemnification. Purchaser hereby agrees to indemnify and hold harmless the Company and the
Company’s officers, directors, stockholders, employees, agents, and attorneys against any and all
losses, claims, demands, liabilities and expenses (including reasonable legal or other expenses
incurred by each such person in connection with defending or investigating any such claims or
liabilities, whether or not resulting in any liability to such person or whether incurred by the
indemnified party in any action or proceeding between the indemnitor and indemnified party or
between the indemnified party and any third party) to which any such indemnified party may become
subject, insofar as such losses, claims, demands, liabilities and expenses (a) arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact made by Purchaser
and contained herein, or (b) arise out of or are based upon any breach by Purchaser of any
representation, warranty or agreement made by Purchaser contained herein.



     11. Miscellaneous.



          (a) Notices. All notices required or permitted hereunder shall be in writing and shall be
deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by
confirmed facsimile if sent during normal business hours of the recipient, and if not during normal
business hours of the recipient, then on the next business day, (iii) five (5) calendar days after
having been




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sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one
business day after deposit with a nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All communications shall be sent to the other party
hereto at such party’s address hereinafter set forth on the signature page hereof, or at such other
address as such party may designate by ten days advance written notice to the other party hereto.




          (b) Successors and Assigns. This Agreement shall inure to the benefit of the successors and
assigns of the Company and, subject to the restrictions on transfer herein set forth, shall be
binding upon Purchaser and Purchaser’s successors and assigns.




          (c) Attorneys’ Fees; Specific Performance. Purchaser shall reimburse the Company for all costs
incurred by the Company in enforcing the performance of, or protecting its rights under, any part
of this Agreement, including reasonable costs of investigation and attorneys’ fees.




          (d) Governing Law; Venue. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York without regard to the principles of conflicts of law
thereof. The parties agree that any action brought by either party to interpret or enforce any
provision of this Agreement shall be brought in, and each party agrees to, and does hereby, submit
to the jurisdiction and venue of, the appropriate state or federal court for the district
encompassing the Company’s principal place of business.




          (e) Further Execution. The parties agree to take all such further action(s) as may reasonably
be necessary to carry out and consummate this Agreement as soon as practicable, and to take
whatever steps may be necessary to obtain any governmental approval in connection with or otherwise
qualify the issuance of the securities that are the subject of this Agreement.




          (f) Independent Counsel. Purchaser acknowledges that this Agreement has been prepared on
behalf of the Company by Proskauer Rose LLP, counsel to the Company and that Proskauer Rose LLP
does not represent, and is not acting on behalf of, Purchaser. Purchaser has been provided with an
opportunity to consult with Purchaser’s own counsel with respect to this Agreement.




          (g) Entire Agreement; Amendment. This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes and merges all prior agreements or
understandings, whether written or oral. This Agreement may not be amended, modified or revoked, in
whole or in part, except by an agreement in writing signed by each of the parties hereto.




          (h) Severability. If one or more provisions of this Agreement are held to be unenforceable
under applicable law, the parties agree to renegotiate such provision in good faith. In the event
that the parties cannot reach a mutually agreeable and enforceable replacement for such provision,
then (i) such provision shall be excluded from this Agreement, (ii) the balance of the Agreement
shall be interpreted as if such provision were so excluded and (iii) the balance of the Agreement
shall be enforceable in accordance with its terms.




          (i) Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one instrument. This
Agreement or any counterpart may be executed via facsimile or electronic mail transmission, and any
such executed facsimile or electronic mail copy shall be treated as an original.




          (j) Survival. The representations and warranties contained herein will survive the delivery
of, and the payment for, the Warrants.





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          (k) Waiver of Jury Trial. Each party hereto hereby irrevocably and unconditionally waives the
right to a trial by jury in any action, suit, counterclaim or other proceeding (whether based on
contract, tort or otherwise) arising out of, connected with or relating to this Agreement, the
transactions contemplated hereby, or the actions of Purchaser in the negotiation, administration,
performance or enforcement hereof.




* * * *




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          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.




	 	 	 	 	 
	 	 	COMPANY:
	 
	 	 	 	 
	 	 	MARKET STREET ACQUISITION CORP.
	 
	 	 	 	 
	 

	 	By:	 	/s/ Jason N. Ader
	 

	 	 	 	 
	 

	 	Name:
	 	Jason N. Ader
	 

	 	Title:
	 	President and Chief Executive Officer
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	PURCHASER:
	 
	 	 	 	 
	 	 	HAYGROUND COVE ASSET MANAGEMENT LLC
	 
	 	 	 	 
	 

	 	By:	 	/s/ Jason N. Ader
	 

	 	 	 	 
	 

	 	Name:
	 	Jason N. Ader
	 

	 	Title:
	 	Sole Member






[Signature Page to Warrant Subscription Agreement]