Document:

f8k030512ex10i_organicspice.htm

 

Exhibit 10.1

 

 

AGREEMENT AND PLAN OF MERGER

 

by and among

 

X-FACTOR COMMUNICATIONS, LLC,

ORGANIC SPICE IMPORTS, INC.

and

X-FACTOR ACQUISITION CORP.

 

 

 

March 5, 2012

 

 

 

 

 

 

 

  

  

  

 

AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger (this “Agreement”) is entered into as of March 5, 2012, by and among Organic Spice Imports, Inc., a Delaware corporation (“ORSI”), X-Factor Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of ORSI (“MergerCo”), and X-Factor Communications, LLC, a New York limited liability company (“X-Factor”).

W I T N E S S E T H

WHEREAS, the Boards of Directors of ORSI, X-Factor and MergerCo (collectively, the “Parties”) have determined that it is in the best interests of such corporations and their respective stockholders and members to consummate the merger of MergerCo with and into X-Factor with X-Factor as the surviving corporation (the “Merger”);

WHEREAS, upon the closing of the Merger, among other things, the outstanding membership interests of X-Factor shall be converted into the Merger Consideration (as hereinafter defined) upon the Effective Time (as hereinafter defined);

WHEREAS, the Exchange Ratio (as hereinafter defined) is predicated on an outstanding share capitalization of ORSI that assumes a total of $4,705,000 (the "Maximum Offering Amount") will be raised in the Private Placement (as defined herein);

WHEREAS, if less than the Maximum Offering Amount is raised in the Private Placement, then after the Closing of the Merger, the Merger Consideration will be adjusted as provided herein;

WHEREAS, the parties to this Agreement intend that the Merger, taken together with the subsequent merger of X-Factor with and into ORSI, qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and that ORSI, MergerCo and X-Factor will each be a “party to a reorganization” within the meaning of Section 368(b) of the Code.

NOW, THEREFORE, in consideration of the representations, warranties and covenants contained herein, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

As used herein, the following terms shall have the following meanings (such meaning to be equally applicable to both the singular and plural forms of the terms defined):

“Affiliate” has the meaning as defined in Rule 12b-2 promulgated under the Exchange Act, as such regulation is in effect on the date hereof.

“Amended Operating Agreement” shall mean the Third Amended and Restated Operating Agreement of X-Factor.

"Cancellation Agreement" shall have the meaning ascribed thereto in Section 6.8.

“Certificate of Merger of Delaware” shall mean the certificate of merger in substantially the form attached hereto as Exhibit A.

 

  

1

  

 

“Certificate of Merger of New York” shall mean the certificate of merger in substantially the form attached hereto as Exhibit B.

“Closing” shall have the meaning as set forth in Section 2.1(c) hereof.

“Closing Date” shall have the meaning as set forth in Section 2.1(c) hereof.

“Code” shall mean Internal Revenue Code of 1986, as amended (the “Code”).

 “Convertible Securities” shall have the meaning as set forth in Section 2.2(d) hereof.

“Delaware General Corporation Law” or “DGCL” shall mean Title 8, Chapter 1 of the Delaware Code, as amended.

“Dissenting Membership Interests” shall have the meaning as set forth in Section 2.5 hereof.

“Effective Date” shall have the meaning ascribed thereto in Section 2.1(c) hereof.

“Effective Time” shall have the meaning ascribed thereto in Section 2.1(c) hereof.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor law and the rules and regulations promulgated thereunder.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, including the rules and regulations promulgated thereunder.

“Exchange Ratio” shall mean approximately 5.286767 shares of ORSI Common Stock for each X-Factor Membership Interest issued and outstanding immediately prior to the Effective Time.

“GAAP” shall mean United States generally accepted accounting principles as in effect from time to time.

“Knowledge” means, with respect to an individual, that such individual is actually aware of a particular fact or other matter, with no obligation to conduct any inquiry or other investigation to determine the accuracy of such fact or other matter. A Person other than an individual shall be deemed to have Knowledge of a particular fact or other matter if the officers, directors or other management personnel of such Person had Knowledge of such fact or other matter.

“Material Adverse Effect” shall, with respect to an entity, mean a material adverse effect on the business, operations, results of operations or financial condition of such entity on a consolidated basis.

 “Merger” shall have the meaning ascribed thereto in the recitals of this Agreement.

“Merger Consideration” means the shares of ORSI Common Stock issuable in exchange for X-Factor Membership Interests in connection with the Merger in accordance with the Exchange Ratio and the Preferred Consideration Amount, as applicable, and options, warrants and convertible debt securities of ORSI issuable in exchange for options, warrants and convertible debt securities of X-Factor as provided herein.

"NY LLC Law" shall have the meaning set forth in the preamble of this Agreement.

“ORSI Common Stock” shall mean the common stock, par value $0.0001 per share, of ORSI.

 

  

2

  

 

“ORSI Insiders” shall have the meaning ascribed thereto in Section 4.11.

“ORSI Latest Balance Sheet” shall have the meaning ascribed thereto in Section 4.17.

“ORSI Preferred Stock” shall mean the preferred stock, par value $0.0001 per share, of ORSI.

“ORSI Returns” shall have the meaning ascribed thereto in Section 4.9(a).

“ORSI SEC Filings” shall have the meaning ascribed thereto in Section 4.5.

“ORSI Stockholders” shall have the meaning ascribed thereto in Section 6.8.

“Options” shall have the meaning as set forth in Section 2.2(f) hereof.

“Person” means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, governmental authority or other entity.

“Preferred Consideration Amount” means approximately 1.190229 shares of ORSI Common Stock for each $1.00 of the purchase price paid by a holder of Preferred Membership Interests in the purchase of such Preferred Membership Interests, rounded to the nearest whole share.

"Private Placement" shall have the meaning ascribed thereto in Section 7.3(e).

 “SEC” shall mean the United States Securities and Exchange Commission.

“Securities Act” shall mean the Securities Act of 1933, as amended, including the rules and regulations promulgated thereunder.

“Stock Option Plan” shall have the meaning as set forth in Section 2.2(f) hereof.

“Subsidiary” shall, with respect to any Person, mean (i) each corporation in which such Person owns directly or indirectly fifty percent (50%) or more of the voting securities of such corporation and (ii) any other Person in which such Person owns at least a majority voting interest, and shall, in each case, unless otherwise indicated, be deemed to refer to both direct and indirect subsidiaries of such Person.

“Surviving Company” shall have the meaning ascribed thereto in Article II.

“Tax” or “Taxes” shall mean any federal, state, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, property or windfall profits taxes, environmental taxes, customs duties, capital stock, franchise, employees’ income withholding, foreign or domestic withholding, social security, unemployment, disability, workers’ compensation, employment-related insurance, real property, personal property, sales, use, transfer, value added, alternative or add-on minimum or other governmental tax, fee, assessment or charge of any kind whatsoever including any interest, penalties or additions to any Tax or additional amounts in respect of the foregoing.

“Warrants” shall have the meaning as set forth in Section 2.2(e) hereof.

“X-Factor Common Membership Interests” means the issued and outstanding common membership units of X-Factor.

 

  

3

  

 

"X-Factor Member(s)" shall mean the holder(s) of X-Factor Membership Interests.

"X-Factor Membership Interests" shall mean the X-Factor Common Membership Interests and the X-Factor Preferred Membership Interests.

“X-Factor Preferred Membership Interests” means the issued and outstanding preferred membership units of X-Factor.

 

ARTICLE II

MERGER

Subject to the satisfaction or waiver of the conditions set forth in Article VII, at the Effective Time, (i) MergerCo will merge with and into X-Factor, and (ii) X-Factor will become a wholly-owned subsidiary of ORSI. The term “Surviving Company” as used herein shall mean X-Factor, as a wholly-owned subsidiary of ORSI after giving effect to the Merger. The Merger will be effected pursuant to the Certificate of Merger in accordance with the provisions of, and with the effect provided in, Article 10, Section 1002 of the NY LLC Law.

 

2.1           Effects of Merger.

(a)       From and after the Effective Time and until further amended in accordance with applicable law, (i) the Articles of Organization of X-Factor as in effect immediately prior to the Effective Time shall be the Articles of Organization of the Surviving Company, and (ii) the Amended Operating Agreement of X-Factor shall be the Operating Agreement of the Surviving Company.

(b)       ORSI,  X-Factor and MergerCo, respectively, shall each use its best efforts to take all such action as may be necessary or appropriate to effectuate the Merger in accordance with the DGCL and the NY LLC Law at the Effective Time. If at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Company with full right, title and possession to all properties, rights, privileges, immunities, powers and franchises of either X-Factor or MergerCo, the officers of the Surviving Company are fully authorized in the name of X-Factor and MergerCo or otherwise to take, and shall take, all such lawful and necessary action.

 

(c)       Subject to the provisions of Article VII and Article VIII hereof, the closing (the “Closing”) of the transactions contemplated hereby shall take place at such  time and place as X-Factor and ORSI mutually agree at the earliest practicable time after the satisfaction or waiver of the conditions in Article VII, but in no event later than ten (10) business days after all such conditions have been satisfied or waived, or on such other date as may be mutually agreed by the parties hereto (the "Closing Date"). On the Closing Date, or as soon thereafter as practicable, to effect the Merger, the parties hereto will cause the Certificate of Merger of New York to be filed with the New York Secretary of State in accordance with the NY LLC Law.  The Merger shall be effective when the Certificate of Merger of New York is filed with the New York Secretary of State (the “Effective Time”). As used herein, the term “Effective Date” shall mean the date on which the Certificate of Merger is filed with the New York Secretary of State.

 

2.2           Effect on X-Factor Membership Interests and MergerCo Capital Stock. To effectuate the Merger, and subject to the terms and conditions of this Agreement, at the Effective Time:

 

(a)       Each X-Factor Membership Interest issued and outstanding immediately prior to the Effective Time shall automatically be converted into and exchangeable for such number of shares of fully paid and nonassessable shares of ORSI Common Stock equal to one multiplied by the Exchange Ratio, rounded to the nearest whole share.

 

  

4

  

 

(b)      Each holder of X-Factor Preferred Membership Interests shall receive the Preferred Consideration Amount at the Closing.

(c)      All shares of common stock, $0.0001 par value per share, of MergerCo issued and outstanding immediately prior to the Effective Time will be converted into and become one validly issued, fully paid and nonassessable X-Factor Common Membership Interest of the Surviving Company.

 

 (d)      At the Effective Date, ORSI shall assume the rights and obligations under all outstanding convertible debt securities (the “Convertible Securities”), if any, issued by X-Factor which are convertible into X-Factor Membership Interests. The Convertible Debt Securities shall be assumed in accordance with their terms and conditions. Each Convertible Security shall, from and after the Effective Time, evidence the right to receive, upon conversion, a number of shares of ORSI Common Stock (in either event, rounded to the nearest whole share) equal to the number of X-Factor Membership Interests into which such Convertible Security is convertible immediately prior to the Effective Date multiplied by the Exchange Ratio. The new conversion price applicable to each such Convertible Security shall be determined by dividing the conversion price immediately prior to the Effective Date by the Exchange Ratio. All references in the Convertible Debt Securities to X-Factor or X-Factor Membership Interests shall be deemed to be references to ORSI and ORSI Common Stock, respectively, after giving effect to the adjustments pursuant to this Section.

 

(e)      At the Effective Time, ORSI shall assume the rights and obligations under X-Factor’s outstanding warrants (the “Warrants”), if any, to purchase X-Factor Membership Interests. The Warrants shall be assumed in accordance with their terms and conditions. Each Warrant shall, from and after the Effective Time, evidence the right to purchase a number of shares of ORSI Common Stock (rounded to the nearest whole share) equal to the number of X-Factor Membership Interests into which such Warrant is exercisable immediately prior to the Effective Date multiplied by Exchange Ratio. The new exercise price of the Warrants shall be determined by dividing the exercise price of the Warrants immediately prior to the Effective Date by Exchange Ratio. All references in the Warrants to X-Factor and X-Factor Membership Interests shall be deemed to be references to ORSI and ORSI Common Stock, respectively, after giving effect to the adjustments pursuant to this Section.  In addition to the foregoing, the one holder of a warrant to purchase X-Factor Preferred Membership Interests will receive at the Effective Time an additional warrant to purchase, for a period of 10 years from the Closing Date, a number of shares of ORSI Common Stock equal to the aggregate exercise price of such preferred warrant, which is $125,137, multiplied by the Preferred Consideration Amount, provided that such additional warrant shall be for the purchase of no less than the number of shares of ORSI Common Stock equal to 27,500 multiplied by the Exchange Ratio, and the exercise price of such additional warrant shall be the quotient of the exercise price of such preferred warrant, which is $4.33 per X-Factor Preferred Membership Interest, divided by the Exchange Ratio.

  

5

  

 

(f)       At the Effective Date, ORSI shall assume all of X-Factor’s rights and obligations under the options to purchase X-Factor Membership Interests, pursuant to X-Factor’s 2006 Long-Term Equity Incentive Plan and 2010 Long Term Incentive Plan (the “Stock Option Plans”), that are outstanding immediately prior to the Effective Time, which stock options are disclosed in Schedule 2.2(f) hereto and have not prior to the Effective Date been exercised, cancelled or terminated nor expired (collectively the “Options”). The Options shall be assumed in accordance with the terms and conditions of the Stock Option Plans pursuant to which such Options were originally granted, except that, from and after the Effective Time: (i) all actions to be taken under the Stock Option Plans or the Options by the X-Factor Members shall be taken by the Board of Directors of ORSI or a committee thereof, (ii) each Option shall evidence the right to purchase a number of shares of ORSI Common Stock (rounded to the nearest whole share) equal to the number of X-Factor Common Membership Interests into which such Options are exercisable immediately prior to the Effective Time multiplied by the Exchange Ratio, (iii) the new option price for each share of ORSI Common Stock issuable upon exercise of an Option shall be determined by dividing the option exercise price immediately prior to the Effective Time by the Exchange Ratio (rounded to the nearest cent) and (iv) all references in the Options and the Stock Option Plans to X-Factor and X-Factor Membership Interests shall be deemed to be references to ORSI and ORSI Common Stock, respectively, after giving effect to the adjustments pursuant to clauses (ii) and (iii). Notwithstanding the provisions set forth in clause (iii) above, with respect to each Option intended to be an “incentive stock option” under Section 422 of the Code, if the new option price calculated pursuant to clause (iii) would cause any such Option not to satisfy the requirements of Section 424(a) of the Code and Treasury Regulation §1.425-1(a)(1)(i), the new exercise price with respect to that Option will be increased to the minimum price that it could be and still satisfy the requirements of that regulation. ORSI agrees to use its best efforts to take such other steps as are necessary to ensure that those Options which are deemed “incentive stock options” under Section 422 of the Code remain “incentive stock options.”

 

2.3           Rights of Holders of X-Factor Membership Interests.

     

On and after the Effective Date and until surrendered for exchange, each outstanding certificate that immediately prior to the Effective Time represented X-Factor Membership Interests (except Dissenting Membership Interests) shall be deemed for all purposes, to evidence ownership of and to represent the number of whole shares of ORSI Common Stock into which such shares of ORSI Common Stock shall have been converted pursuant to Section 2.2 above. The record holder of each such outstanding certificate representing X-Factor Membership Interests, shall, after the Effective Time, be entitled to vote the shares of  ORSI Common Stock into which such X-Factor Membership Interests shall have been converted on any matters on which the holders of record of ORSI Common Stock, as of any date subsequent to the Effective Date, shall be entitled to vote. In any matters relating to such certificates of X-Factor Membership Interests, X-Factor may rely conclusively upon the record of X-Factor Members maintained by X-Factor containing the names and addresses of the holders of record of X-Factor Membership Interests on the Effective Date. 

 

2.4           Procedure for Exchange of X-Factor Membership Interests.

(a)      After the Effective Time, holders of certificates theretofore evidencing outstanding X-Factor Membership Interests (except Dissenting Membership Interests), upon surrender of such certificates to the Secretary of ORSI, shall be entitled to receive certificates representing the number of shares of ORSI Common Stock into which X-Factor Membership Interests theretofore represented by the certificates so surrendered are exchangeable as provided in Section 2.2(a) hereof. ORSI shall not be obligated to deliver any such shares of ORSI Common Stock to which any former holder of X-Factor Membership Interests is entitled until such holder surrenders the certificate or certificates representing such Membership Interests. Upon surrender, each certificate evidencing X-Factor Membership Interests shall be canceled. If there has been a transfer of ownership of any X-Factor Membership Interest that has not been recorded in the transfer records of X-Factor, a certificate representing the proper number of shares of ORSI Common Stock may be issued to a person other than the person in whose name the certificate so surrendered is registered if: (x) upon presentation to the Secretary of ORSI, such certificate shall be properly endorsed or otherwise be in proper form for transfer, (y) the person requesting such issuance shall pay any transfer or other taxes required by reason of the issuance of shares of ORSI Common Stock to a person other than the registered holder of such X-Factor Membership Interest or establish to the reasonable satisfaction of ORSI that such tax has been paid or is not applicable, and (z) the issuance of such ORSI Common Stock shall not, in the sole discretion of ORSI, violate the requirements of the Regulation D or Regulation S “safe harbor” of the Securities Act with respect to the private placement of ORSI Common Stock that will result from the Merger.

 

  

6

  

 

 

(b)      All shares of ORSI Common Stock issued upon the surrender for exchange of X-Factor Membership Interests in accordance with the above terms and conditions shall be deemed to have been issued and paid in full satisfaction of all rights pertaining to such X-Factor Membership Interests.

(c)      Any shares of ORSI Common Stock issued in the Merger will not be transferable except (1) pursuant to an effective registration statement under the Securities Act or (2) upon receipt by ORSI of a written opinion of counsel for the holder reasonably satisfactory to ORSI to the effect that the proposed transfer is exempt from the registration requirements of the Securities Act and relevant state securities laws. Restrictive legends shall be placed on all certificates representing shares of ORSI Common Stock issued in the Merger, substantially as follows:

“NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS IN EFFECT THEREUNDER AND ALL APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS (SUCH FEDERAL AND STATE LAWS, THE “SECURITIES LAWS”) OR (B) IF THE CORPORATION HAS BEEN FURNISHED WITH AN OPINION OF COUNSEL FOR THE HOLDER, WHICH OPINION AND COUNSEL SHALL BE REASONABLY SATISFACTORY TO THE CORPORATION, TO THE EFFECT THAT SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION IS EXEMPT FROM THE PROVISIONS OF THE SECURITIES LAWS.

and, if applicable in accordance with Regulation S:

“THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE WHICH IS SIX MONTHS AFTER THE ISSUE DATE HEREOF ONLY (A) TO SUCH ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT OF 1933 (THE “SECURITIES ACT”), (C) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S IN A TRANSACTION MEETING THE REQUIREMENTS OF RULES 904 AND 905 UNDER THE SECURITIES ACT, OR (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO SUCH ISSUER’S RIGHT PRIOR TO ANY OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C)  OR (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATES, AND/OR OTHER INFORMATION REASONABLY SATISFACTORY TO SUCH ISSUER.  HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.”

(d)      In the event any certificate for X-Factor Membership Interests or any certificate or similar instrument evidencing Warrants or Convertible Securities shall have been lost, stolen or destroyed, ORSI shall issue and pay in exchange for such lost, stolen or destroyed certificate, promptly following its receipt of an affidavit of that fact by the holder thereof, such shares of ORSI Common Stock as may be required pursuant to this Agreement; provided, however, that ORSI, in its discretion and as a condition precedent to the issuance and payment thereof, may require the owner of such lost, stolen or destroyed certificate to deliver a bond in such sum as it may direct as indemnity against any claim that may be made against ORSI or any other party with respect to the certificate alleged to have been lost, stolen or destroyed.

 

  

7

  

 

2.5           Dissenting Shares. X-Factor Membership Interests held by X-Factor Members who have properly demanded payment with respect to those membership interests in accordance with Article 10, Section 1002 of the NY LLC Law (“Dissenting Membership Interests”) shall not be converted into or represent a right to receive shares of ORSI Common Stock pursuant to Section 2.2 above, but the holders thereof shall be entitled only to such rights as are granted by Article 10, Section 1002 and Section 1005 of the NY LLC Law. Each holder of Dissenting Membership Interests who becomes entitled to payment for such membership interests pursuant to Article 10, Section 1005 of the NY LLC Law shall receive payment therefore from the Surviving Company in accordance with such laws; provided, however, that if any such holder of Dissenting Membership Interests shall have effectively withdrawn such holder’s demand for payment for such membership interests or lost such holder’s right to payment of such membership interests  under Article 10, Section 1005 of the NY LLC Law, such holder or holders (as the case may be) shall forfeit the right to payment for such membership interests and each membership interest shall thereupon be deemed to have been canceled, extinguished and exchanged, as of the Effective Time, into and represent the right to receive from ORSI shares of ORSI Common Stock as provided in Section 2.2 above. Any payments in respect of Dissenting Membership Interests will be deemed made by the Surviving Company.

 

2.6           Directors and Officers of the Surviving Corporation. From and after the Effective Time, ORSI shall be the managing member of X-Factor, subject to the provisions contained in the Articles of Organization and Operating Agreement of the Surviving Company and applicable law.

 

2.7           Directors and Officers of ORSI. At the Closing, the Board of Directors of ORSI shall take the following action, to be effective upon the Effective Time: (i) increase the size of the Board of Directors of ORSI to three (3) persons; (ii) elect to the Board of Directors of ORSI the persons set forth on Schedule A hereto (iii) appoint as the officers of ORSI, the persons set forth on Schedule A hereto. Subject to applicable law, ORSI shall take all action reasonably requested by X-Factor, but consistent with the Certificate of Incorporation and Bylaws of ORSI, that is reasonably necessary to effect any such election or appointment of the designees of X-Factor to ORSI’s Board of Directors.  The provisions of this Section 2.7 are in addition to and shall not limit any rights which X-Factor or any of its Affiliates may have as a holder or beneficial owner of shares of capital stock of ORSI as a matter of law with respect to the election of directors or otherwise. The newly-appointed directors and officers of ORSI shall hold office for the term specified in, and subject to the provisions contained in, the Certificate of Incorporation and Bylaws of ORSI and applicable law.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF X-FACTOR

X-Factor hereby represents and warrants to ORSI and MergerCo as follows:

 

3.1           Organization and Qualification. X-Factor is, and on the Effective Date will be, a limited liability company duly organized, validly existing and in good standing under the laws of the State of New York, and has the requisite corporate power to carry on its business as now conducted.

3.2           Authority Relative to this Agreement; Non-Contravention. The execution and delivery of this Agreement by X-Factor and the consummation by X-Factor of the transactions contemplated hereby have been duly authorized by the Board of Directors and members of X-Factor and, except for approval of this Agreement and the Merger by the affirmative vote of a majority of votes that holders of X-Factor Membership Interests are entitled to cast, which will be obtained prior to Closing, no other corporate proceedings on the part of X-Factor are necessary to authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by X-Factor and, assuming it is a valid and binding obligation of ORSI and MergerCo, constitutes a valid and binding obligation of X-Factor enforceable in accordance with its terms except as enforcement may be limited by general principles of equity whether applied in a court of law or a court of equity and by bankruptcy, insolvency and similar laws affecting creditors’ rights and remedies generally. Except for (w) approvals under applicable Blue Sky laws and filing of Form D with the Securities and Exchange Commission; (x) the filing of a Certificate of Merger of Delaware with the Secretary of State of Delaware; (y) the filing of a Certificate of Merger of New York with the Secretary of State of New York and (z) the consents set forth on Schedule 3.2, no authorization, consent or approval of, or filing with, any public body, court or authority is necessary on the part of X-Factor for the consummation by X-Factor of the transactions contemplated by this Agreement, except for such authorizations, consents, approvals and filings as to which the failure to obtain or make the same would not, in the aggregate, reasonably be expected to have a Material Adverse Effect on X-Factor or the Surviving Company or adversely affect the consummation of the transactions contemplated hereby.

 

  

8

  

 

3.3           No Conflicts. X-Factor is not subject to, or obligated under, any provision of (a) its Articles of Organization or Operating Agreement, (b) any agreement, arrangement or understanding, (c) any license, franchise or permit or (d) subject to obtaining the approvals referred to in the next sentence, any law, regulation, order, judgment or decree, which would conflict with, be breached or violated, or in respect of which a right of termination or acceleration or any security interest, charge or encumbrance on any of its assets would be created, by the execution, delivery or performance of this Agreement, or the consummation of the transactions contemplated hereby, other than any such conflicts, breaches, violations, rights of termination or acceleration or security interests, charges or encumbrances which, in the aggregate, could not reasonably be expected to result in a Material Adverse Effect on X-Factor or the Surviving Company.

3.4          Litigation. There are no actions, suits, proceedings, orders or investigations pending or, to the Knowledge of X-Factor, threatened against X-Factor or its officers, directors, employees or Affiliates, or the nominees for officer or director of ORSI after the Effective Time, individually or in the aggregate, at law or in equity, or before or by any federal, state or other governmental department, court, commission, board, bureau, agency or instrumentality, domestic or foreign, and to the Knowledge of X-Factor, there is no reasonable basis for any proceeding, claim, action or governmental investigation directly or indirectly involving X-Factor or its managing member, officers, employees or affiliates, individually or in the aggregate. X-Factor is not a party to any order, judgment or decree issued by any federal, state or other governmental department, court, commission, board, bureau, agency or instrumentality, domestic or foreign.

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF ORSI AND MERGERCO

ORSI and MergerCo hereby represent and warrant to X-Factor as follows:

 

4.1           Organization and Qualification.  ORSI and MergerCo each are, and on the Effective Date will be, corporations duly organized, validly existing and in good standing under the laws of the State of Delaware, and each has, and on the Effective Date will have, the requisite corporate power to carry on their respective businesses as now conducted. The copies of the Certificate of Incorporation and Bylaws of ORSI and MergerCo that have been made available to X-Factor on or prior to the date of this Agreement are correct and complete copies of such documents as in effect as of the date hereof, and shall be in effect on the Effective Date. ORSI and MergerCo are, and on the Effective Date each will be, licensed or qualified to do business in every jurisdiction which the nature of their respective businesses or their respective ownership of properties require each to be licensed or qualified, except where the failure to be so licensed or qualified would not have a Material Adverse Effect on ORSI or MergerCo, respectively.

 

  

9

  

 

4.2           Authority Relative to this Agreement; Non-Contravention. Each of ORSI and MergerCo has the requisite corporate power and authority to enter into this Agreement, and to carry out its obligations hereunder. The execution and delivery of this Agreement by ORSI and MergerCo, and the consummation by ORSI and MergerCo of the transactions contemplated hereby have been duly authorized by the Boards of Directors of ORSI and MergerCo. No further corporate proceedings on the part of ORSI or MergerCo are necessary to authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby or will otherwise be sought by ORSI. This Agreement has been duly executed and delivered by ORSI and MergerCo and, assuming it is a valid and binding obligation of X-Factor, constitutes a valid and binding obligation of ORSI and MergerCo enforceable in accordance with its terms except as enforcement may be limited by general principles of equity whether applied in a court of law or a court of equity and by bankruptcy, insolvency and similar laws affecting creditors’ rights and remedies generally. Except for (x) approvals under applicable Blue Sky laws and the filing of Form D with the Securities and Exchange Commission and (y) the filing of the Certificate of Merger with the Delaware Secretary of State, no authorization, consent or approval of, or filing with, any public body, court or authority is necessary on the part of ORSI or MergerCo for the consummation by ORSI or MergerCo of the transactions contemplated by this Agreement, except for such authorizations, consents, approvals and filings as to which the failure to obtain or make the same would not, in the aggregate, reasonably be expected to have a Material Adverse Effect on ORSI or MergerCo, or adversely affect the consummation of the transactions contemplated hereby.

 

4.3           No Conflicts. Neither ORSI nor MergerCo is subject to, or obligated under, any provision of (a) their respective Certificates of Incorporation or Bylaws, (b) any agreement, arrangement or understanding, (c) any license, franchise or permit, nor (d) subject to obtaining the approvals referred to in the next sentence, any law, regulation, order, judgment or decree, which would conflict with, be breached or violated, or in respect of which a right of termination or acceleration or any security interest, charge or encumbrance on any of their respective assets would be created, by the execution, delivery or performance of this Agreement or the consummation of the transactions contemplated hereby, other than any such conflicts, breaches, violations, rights of termination or acceleration or security interests, charges or encumbrances which, in the aggregate, could not reasonably be expected to have a Material Adverse Effect on ORSI or MergerCo.

4.4           Capitalization.

 

(a)      As of the date hereof, ORSI is, and on the Effective Date will be, authorized to issue 100,000,000 shares of common stock, par value $0.0001 per share, and 20,000,000 shares of preferred stock, par value $0.0001 per share, of which 11,180,000 shares of common stock and no shares of preferred stock are currently issued and outstanding, excluding the shares of Common Stock to be issued in connection with the Private Placement. The issued and outstanding shares of capital stock of ORSI are, and on the Effective Date will be, duly authorized, validly issued, fully paid and nonassessable and not issued in violation of any preemptive rights and, to ORSI’s Knowledge, free from any restrictions on transfer (other than restrictions under the Securities Act or state securities laws) or any option, lien, pledge, security interest, encumbrance or charge of any kind. ORSI has, and on the Effective Date will have, no other equity securities or securities containing any equity features authorized, issued or outstanding. As of the Effective Date, there are no agreements or other rights or arrangements existing which provide for the sale or issuance of capital stock by ORSI and there are no rights, subscriptions, warrants, options, conversion rights or agreements of any kind outstanding to purchase or otherwise acquire from ORSI any shares of capital stock or other securities of ORSI of any kind, and there will not be any such agreements prior to or on the Effective Date. There are, and on the Effective Date there will be, no agreements or other obligations (contingent or otherwise) which may require ORSI to repurchase or otherwise acquire any shares of its capital stock other than the Cancellation Agreement. 

 

(b)      ORSI is not a party to, and, to ORSI’s Knowledge, there do not exist, any voting trusts, proxies, or other contracts with respect to the voting of shares of capital stock of ORSI.

 

  

10

  

 

(c)      The authorized capital of MergerCo consists of 1,000 shares of common stock, par value $0.0001 per share, all of which are, and on the Effective Date will be, issued and outstanding and held of record by ORSI. The issued and outstanding shares of capital stock of MergerCo are, and on the Effective Date will be, duly authorized, validly issued, fully paid and nonassessable and have not been issued in violation of any preemptive rights, and, to ORSI’s Knowledge, free from any restrictions on transfer (other than restrictions under the Securities Act or state securities laws) or any option, lien, pledge, security interest, encumbrance or charge of any kind. There are no rights, subscriptions, warrants, options, conversion rights or agreements of any kind outstanding to purchase or otherwise acquire from MergerCo any shares of capital stock or other securities of MergerCo of any kind, and there will not be any such agreements prior to or on the Effective Date. There are, and on the Effective Date there will be, no agreements or other obligations (contingent or otherwise) which may require MergerCo to repurchase or otherwise acquire any shares of its capital stock.

4.5           Intentionally Omitted. 

 

4.6           Litigation. There are no actions, suits, proceedings, orders or investigations pending or, to the Knowledge of ORSI, threatened against ORSI, MergerCo, or ORSI’s officers, directors, employees or Affiliates, individually or in the aggregate, at law or in equity, or before or by any federal, state or other governmental department, court, commission, board, bureau, agency or instrumentality, domestic or foreign, and to the Knowledge of ORSI, there is no reasonable basis for any proceeding, claim, action or governmental investigation directly or indirectly involving ORSI, MergerCo, or ORSI’s officers, directors, employees or affiliates, individually or in the aggregate. Neither ORSI nor MergerCo are a party to any order, judgment or decree issued by any federal, state or other governmental department, court, commission, board, bureau, agency or instrumentality, domestic or foreign.

 

4.7          Subsidiaries.  ORSI does not own, directly or indirectly, any capital stock or equity interest in any corporation or other form of business organization other than MergerCo and X-Factor Communications Holdings, Inc.

 

4.8           No Brokers or Finders. None of ORSI or any of its officers, directors, employees or Affiliates has employed any broker, finder, investment banker or investment advisor or Person performing a similar function, or incurred any liability for brokerage commissions, finders’ fees, investment advisory fees or similar compensation in connection with the transactions contemplated by this Agreement.

  

4.9           Validity of the ORSI Common Stock. The shares of ORSI Common Stock to be issued to holders of X-Factor Membership Units pursuant to this Agreement will be, when issued, duly authorized, validly issued, fully paid and nonassessable.

 

4.10         Real Property. ORSI does not own or lease any real property.

 

4.11         Insurance. ORSI does not own or maintain any insurance policies.

 

4.12         Employee Benefit Plans.

(a) ORSI does not have any (i) “employee benefit plans,” within the meaning of Section 3(3) of ERISA, (ii) bonus, stock option, stock purchase, stock appreciation right, incentive, deferred compensation, supplemental retirement, severance, and fringe benefit plans, programs, policies or arrangements, or (iii) employment or consulting agreements, for the benefit of, or relating to, any current or former employee (or any beneficiary thereof) of ORSI, in the case of a plan described in (i) or (ii) above, that is currently maintained by ORSI or with respect to which ORSI has an obligation to contribute, and in the case of an agreement described in (iii) above, that is currently in effect.

 

(b) No director, officer, or employee of ORSI will become entitled to retirement, severance or similar benefits or to enhanced or accelerated benefits (including any acceleration of vesting or lapsing of restrictions with respect to equity-based awards) solely as a result of consummation of the transactions contemplated by this Agreement.

 

  

11

  

 

4.13         Employees. Except as disclosed in the ORSI SEC Filings, ORSI has no employees.

  

ARTICLE V

CONDUCT OF BUSINESS PENDING THE MERGER

5.1           Conduct of Business by ORSI and MergerCo. From the date of this Agreement to the Effective Date, unless X-Factor shall otherwise agree in writing or as otherwise expressly contemplated or permitted by other provisions of this Agreement, including but not limited to this Section 5.1, neither ORSI nor MergerCo shall, directly or indirectly, (a) amend its Certificate of Incorporation or Bylaws, (b) split, combine or reclassify any outstanding shares of capital stock of ORSI , (c) declare, set aside, make or pay any dividend or distribution in cash, stock, property or otherwise with respect to the capital stock of ORSI , (d) default in its obligations under any material debt, contract or commitment which default results in the acceleration of obligations due thereunder, except for such defaults arising out of ORSI ’s entry into this Agreement for which consents, waivers or modifications are required to be obtained, (e) conduct its business other than in the ordinary course on an arms-length basis and in accordance in all material respects with all applicable laws, rules and regulations and ORSI ’s past custom and practice, (f) issue or sell any additional shares of, or options, warrants, conversions, privileges or rights of any kind to acquire any shares of, any of its capital stock, except in connection with the exercise or conversion of ORSI securities outstanding on the date of this Agreement or payment of stock dividends, (g) acquire (by merger, exchange, consolidation, acquisition of stock or assets or otherwise) any corporation, partnership, joint venture or other business organization or division or material assets thereof or (h) make or change any material tax elections, settle or compromise any material tax liability or file any amended tax return.

 

ARTICLE VI

ADDITIONAL COVENANTS AND AGREEMENTS

 

6.1           Governmental Filings. Subject to the terms and conditions herein provided, each party will use all reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable to consummate and make effective as promptly as practicable the transactions contemplated by this Agreement. Each party will use all reasonable efforts and will cooperate with the other party in the preparation and filing, as soon as practicable, of all filings, applications or other documents required under applicable laws, including, but not limited to, the Exchange Act, to consummate the transactions contemplated by this Agreement. Prior to submitting each filing, application, or other document with the applicable regulatory authority, each party will, to the extent practicable, provide the other party with an opportunity to review and comment on each such filing, application, or other document to the extent permitted by applicable law. Each party will use all reasonable efforts and will cooperate with the other party in taking any other actions necessary to obtain such regulatory or other approvals and consents at the earliest practicable time, including participating in any required hearings or proceedings.

 

6.2           Expenses. Except as otherwise provided in this Agreement, all costs and expenses incurred in connection with this Agreement, and the transactions contemplated hereby, shall be paid by X-Factor.

 

6.3           Press Releases. X-Factor and ORSI shall agree with each other as to the form and substance of any press release or public announcement related to this Agreement or the transactions contemplated hereby; provided, however, that nothing contained herein shall prohibit either party, following notification to the other party, from making any disclosure which is required by law or regulation. If any such press release or public announcement is so required, the party making such disclosure shall consult with the other party prior to making such disclosure, and the parties shall use all reasonable efforts, acting in good faith, to agree upon a text for such disclosure which is satisfactory to both parties.

 

  

12

  

 

6.4           Securities Reports. ORSI shall file with the SEC all reports and other documents required to be filed under the Securities Act or Exchange Act. All such reports and documents (i) shall not, as of the date of such filing, contain any untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, and (ii) shall comply as to form, in all material respects, with the applicable rules and regulations of the SEC.

  

6.5           X-Factor Members' Approval; Materials to Members.  The Parties shall, in accordance with the Amended Operating Agreement, obtain X-Factor Member approval as promptly as practicable after the date hereof for the purpose of considering and taking action upon this Agreement and the Merger.

 

6.6           Failure to Fulfill Conditions. In the event that either of the parties hereto determines that a condition to its respective obligations to consummate the transactions contemplated hereby cannot be fulfilled on or prior to the termination of this Agreement, it will promptly notify the other party.

 

6.7           Notification of Certain Matters. On or prior to the Effective Date, each party shall give prompt notice to the other party of (i) the occurrence or failure to occur of any event or the discovery of any information, which occurrence, failure or discovery would be likely to cause any representation or warranty on its part contained in this Agreement to be untrue, inaccurate or incomplete after the date hereof in any material respect or, in the case of any representation or warranty given as of a specific date, would be likely to cause any such representation or warranty on its part contained in this Agreement to be untrue, inaccurate or incomplete in any material respect as of such specific date, and (ii) any material failure of such party to comply with or satisfy any covenant or agreement to be complied with or satisfied by it hereunder.

6.8           Cancellation of ORSI Shares and Warrants. Prior to the Effective Date, ORSI and each of the persons set forth on Schedule 6.8 hereto holding shares of ORSI Common Stock on the date hereof (the “ORSI Stockholders”) shall have entered into an agreement in substantially the form attached hereto as Exhibit C (the “Cancellation Agreement”) pursuant to which ORSI will cancel all shares of ORSI Common Stock set forth on Schedule 6.8 and all warrants to purchase shares of ORSI Common Stock (the “ORSI Warrants”) held by the ORSI Stockholders. The cancellation such shares and warrants shall become effective immediately prior to the Effective Time.

6.9           Adjustments to Merger Consideration.  If, upon final completion or termination of the Private Placement, the Private Placement has yielded gross proceeds less than the Maximum Offering Amount, then after the Closing the Exchange Ratio shall be adjusted to the extent necessary to be consistent in all material respects with the disclosures set forth in X-Factor's Confidential Private Placement Memorandum delivered in connection with the Private Placement, as supplemented or amended, under the heading "Capitalization".  In such case, the number of shares underlying options, warrants and convertible securities included within the Merger Consideration, and the exercise or conversion prices thereof, as applicable, shall be adjusted in accordance with such adjusted Exchange Ratio.

 

 

  

13

  

 

ARTICLE VII

CONDITIONS

 

7.1           Conditions to Obligations of Each Party. The respective obligations of each party to effect the transactions contemplated hereby are subject to the fulfillment or waiver at or prior to the Effective Date of the following conditions:

(a)      No Prohibitive Change of Law. There shall have been no law, statute, rule or regulation, domestic or foreign, enacted or promulgated which would prohibit or make illegal the consummation of the transactions contemplated hereby.

 

(b)      Requisite Approvals. This Agreement and the Merger shall have been approved by the X-Factor Members, the Boards of Directors of ORSI and MergerCo. 

(c)      Adverse Proceedings. There shall not be threatened, instituted or pending any action or proceeding before any court or governmental authority or agency (i) challenging or seeking to make illegal, or to delay or otherwise directly or indirectly restrain or prohibit, the consummation of the transactions contemplated hereby or seeking to obtain material damages in connection with such transactions, (ii) seeking to prohibit direct or indirect ownership or operation by ORSI or MergerCo of all or a material portion of the business or assets of X-Factor, or to compel ORSI or MergerCo or X-Factor to dispose of or to hold separately all or a material portion of the business or assets of ORSI or MergerCo or of X-Factor, as a result of the transactions contemplated hereby; (iii) seeking to invalidate or render unenforceable any material provision of this Agreement or any of the other agreements attached as exhibits hereto or contemplated hereby, or (iv) otherwise relating to and materially adversely affecting the transactions contemplated hereby. 

(d)      Governmental Action. There shall not be any action taken, or any statute, rule, regulation, judgment, order or injunction proposed, enacted, entered, enforced, promulgated, issued or deemed applicable to the transactions contemplated hereby, by any federal, state or other court, government or governmental authority or agency, that would reasonably be expected to result, directly or indirectly, in any of the consequences referred to in Section 7.1(d).

 

7.2           Additional Conditions to Obligation of ORSI and MergerCo. The obligation of ORSI and MergerCo to consummate the transactions contemplated hereby in accordance with the terms of this Agreement is also subject to the fulfillment or waiver of the following conditions:

 

(a)       Representations and Compliance. The representations of X-Factor contained in this Agreement were accurate as of the date of this Agreement and are accurate as of the Closing Date, in all respects (in the case of any representation containing any materiality qualification) or in all material respects (in the case of any representation without any materiality qualification), except for representations and warranties made as of a specific date, which shall be accurate as of such date. X-Factor shall in all material respects have performed each obligation and agreement and complied with each covenant to be performed and complied with by it hereunder at or prior to the Closing Date.

(b)      Consents and Approvals. X-Factor shall have obtained all consents and approvals necessary to consummate the transactions contemplated by this Agreement, including those consents and approvals set forth on Schedule 7.2(b), in order that the transactions contemplated herein do not constitute a breach or violation of, or result in a right of termination or acceleration of, or creation of any encumbrance on any of X-Factor’s assets pursuant to the provisions of, any agreement, arrangement or undertaking of or affecting X-Factor or any license, franchise or permit of or affecting X-Factor.

(c)       Merger Certificates. X-Factor shall have executed a copy of the Certificate of Merger of Delaware and the Certificate of Merger of New York.

 

  

14

  

 

(d)       Accredited Investors.  ORSI shall be reasonably satisfied that the X-Factor Members and holders of the Convertible Debt Securities and the Warrants do not collectively include more than 35 persons who are not accredited investors, as that term is defined under Regulation D of the Securities Act; provided that ORSI may proceed with the Closing before it is so satisfied on the condition that it may withhold delivery of Merger Consideration to any U.S. person who fails to satisfy ORSI as to his, her or its accredited status, and provided further that if ORSI fails to deliver such Merger Consideration to any U.S. person within 120 days following the Closing as a result of such failure to reasonably satisfy ORSI as to such person's accredited status, then ORSI shall have the right to deem the person(s) to whom such Merger Consideration is otherwise owing as Dissenting Members having the right to receive payment as provided in Section 2.5 hereof in lieu of Merger Consideration, and in such case the amount of Merger Consideration otherwise owing to such person(s) shall be forever cancelled on the books and records of ORSI.

7.3           Additional Conditions to Obligation of X-Factor. The obligation of X-Factor to consummate the transactions contemplated hereby in accordance with the terms of this Agreement is also subject to the fulfillment or waiver of the following conditions:

 

(a)      Representations And Compliance. The representations of ORSI and MergerCo contained in this Agreement were accurate as of the date of this Agreement and are accurate as of the Effective Time, in all respects (in the case of any representation containing any materiality qualification) or in all material respects (in the case of any representation without any materiality qualification), except for representations and warranties made as of a specific date, which shall be accurate as of such date. ORSI and MergerCo, respectively, shall in all material respects have performed each obligation and agreement and complied with each covenant to be performed and complied with by them hereunder at or prior to the Effective Date.

(b)      Secretary’s Certificate. ORSI shall have furnished to X-Factor (i) copies of the text of the resolutions by which the corporate action on the part of ORSI necessary to approve this Agreement and the Certificate of Merger, the election of the officers and directors of ORSI to serve following the Closing Date and the transactions contemplated hereby and thereby were taken, which shall be accompanied by a certificate of the corporate secretary or assistant corporation secretary of ORSI dated as of the Closing Date certifying to X-Factor that such copies are true, correct and complete copies of such resolutions and that such resolutions were duly adopted and have not been amended or rescinded, (ii) an incumbency certificate dated as of the Closing Date executed on behalf of ORSI by its corporate secretary or one of its assistant corporate secretaries certifying the signature and office of each officer of ORSI executing this Agreement, the Certificates of Merger or any other agreement, certificate or other instrument executed pursuant hereto, and (iii) a copy of the Certificate of Incorporation of ORSI , certified by the Secretary of State of Delaware, and certificates from the Secretary of State of Delaware evidencing the good standing of ORSI in such jurisdiction as of a day within five (5) business days prior to the Closing Date.

(c)      Consents and Approvals. ORSI and MergerCo shall have obtained all consents and approvals necessary to consummate the transactions contemplated by this Agreement in order that the transactions contemplated herein not constitute a breach or violation of, or result in a right of termination or acceleration of, or creation of any encumbrance on any of ORSI’s or MergerCo’s assets pursuant to the provisions of, any agreement, arrangement or undertaking of or affecting ORSI or any license, franchise or permit of or affecting ORSI .

(d)      ORSI Cancellation of Outstanding Shares and Warrants. ORSI shall have entered into the Cancellation Agreement with all of the ORSI Stockholders and the transactions contemplated thereby shall have been consummated.

 

  

15

  

 

(e)       Offering.  The receipt of subscriptions for a minimum amount of $1,500,000 of ORSI Common Stock in connection with a private placement offering of up to 6,666,667 shares ($5,000,000) of ORSI Common Stock including an over-allotment option (the "Private Placement"), which minimum amount shall include the $295,000 paid by the purchasers signatory to that certain Amended and Restated Agreement for the Purchase of Common Stock and Warrants, dated January 13, 2012 and amended on January 20, 2012, as described under Item 5.01 of the Form 8-K filed by ORSI on February 16, 2012 (the "Shell Purchase Agreement").

(f)       New Jersey Economic Development Authority (NJEDA) Consent. The NJEDA shall have provided written consent and approval for the consummation of the transactions contemplated by this Agreement.

(g)      Regulation D; Information Delivery.  ORSI have delivered to the X-Factor Members who are U.S. persons (within the meaning of Regulation S under the Securities Act) but who are not accredited investors (within the meaning of Regulation D under the Securities Act) the information required to be delivered to non-accredited investors pursuant to Rule 502 of Regulation D.

(h)      Transfer of ORSI Common Stock to Wynston Hill Capital.  At the Closing, the purchasers signatory to the Shell Purchase Agreement shall have executed such documentation as may be required by ORSI's stock transfer agent in order to effect the transfer to X-Factor's placement agent, Wynston Hill Capital, LLC, an aggregate of 656,667 of the unrestricted shares purchased thereunder.

ARTICLE VIII

TERMINATION, AMENDMENT AND WAIVER

 

8.1           Termination. This Agreement may be terminated prior to the Effective Date:

(a)      by mutual consent of X-Factor and ORSI;

(b)      by ORSI, if any representation of X-Factor set forth in this Agreement was inaccurate when made or becomes inaccurate such that the condition set forth in Section 7.2(a) could not be satisfied;

(c)      by X-Factor, if any representation of ORSI set forth in this Agreement was inaccurate when made or becomes inaccurate such that the condition set forth in Section 7.3(a) could not be satisfied;

(d)      by ORSI, if X-Factor fails to perform or comply with any of the obligations that it is required to perform or to comply with under this Agreement such that the conditions set forth in Section 7.2(a) could not be satisfied;

(e)      by X-Factor, if ORSI fails to perform or comply with any of the obligations that it is required to perform or to comply with under this Agreement such that the conditions set forth in Section 7.3(a) could not be satisfied;

(f)       by X-Factor, if, the Merger and this Agreement are not duly approved by the X-Factor Members, by vote or written consent;

 

Any party desiring to terminate this Agreement shall give prior written notice of such termination and the reasons therefore to the other party.

 

  

16

  

 

ARTICLE IX

GENERAL PROVISIONS

 

9.1           Notices. All notices and other communications hereunder shall be in writing and shall be sufficiently given if made by hand delivery, by telecopier, by overnight delivery service for next business day delivery, or by registered or certified mail (return receipt requested), in each case with delivery charges prepaid, to the parties at the following addresses (or at such other address for a party as shall be specified by it by like notice):

 

	
If to X-Factor:

	
X-Factor Communications, LLC

3 Empire Blvd - 5th Floor

South Hackensack, NJ 07606

Attn: Charles Saracino, Chief Executive Officer

	  	  
	
With copies to:

	
Richardson & Patel LLP

750 Third Avenue, 9th Floor

New York, New York 10017

Facsimile: (917) 591-6898

Attn: Kevin Friedmann

	  	  
	
If to ORSI 

or MergerCo:

	
Organic Spice Imports, Inc.

7910 Ivanhoe Avenue #414

La Jolla, CA 92037

Facsimile: 858-459-1133

Attn: Charles Saracino, President

 

All such notices and other communications shall be deemed to have been duly given as follows: when delivered by hand, if personally delivered, when received; (i) if delivered by registered or certified mail (return receipt requested), when receipt acknowledged; or (ii) if telecopied, on the day of transmission or, if that day is not a business day, on the next business day; and the next business day delivery after being timely delivered to a recognized overnight delivery service.

 

9.2           No Survival. The representations and warranties and obligations contained in this Agreement will terminate at the Effective Time or on termination of this Agreement in accordance with Section 8.1, except that the obligations contained in Article II and any other obligation contained in this Agreement requiring performance or compliance after the Effective Time (including without limitation Section 6.3(d)) will survive the Effective Time indefinitely.

9.3           Interpretation. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. References to Sections and Articles refer to Sections and Articles of this Agreement unless otherwise stated. Words such as “herein,” “hereinafter,” “hereof,” “hereto,” “hereby” and “hereunder,” and words of like import, unless the context requires otherwise, refer to this Agreement (including the Schedules hereto). As used in this Agreement, the masculine, feminine and neuter genders shall be deemed to include the others if the context requires.

 

9.4           Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties shall negotiate in good faith to modify this Agreement and to preserve each party’s anticipated benefits under this Agreement.

 

  

17

  

 

9.5           Amendment. This Agreement may not be amended or modified except by an instrument in writing approved by the parties to this Agreement and signed on behalf of each of the parties hereto.

 

9.6           Waiver. At any time prior to the Effective Date, any party hereto may (a) extend the time for the performance of any of the obligations or other acts of the other party hereto or (b) waive compliance with any of the agreements of the other party or with any conditions to its own obligations, in each case only to the extent such obligations, agreements and conditions are intended for its benefit. Any such extension or waiver shall only be effective if made in writing and duly executed by the party giving such extension or waiver.

 

9.7           Miscellaneous. This Agreement (together with all other documents and instruments referred to herein): (a) constitutes the entire agreement, and supersedes all other prior agreements and undertakings, both written and oral, among the parties, with respect to the subject matter hereof; and (b) shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, but shall not be assignable by either party hereto without the prior written consent of the other party hereto.

 

9.8           Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement.

 

9.9           Third Party Beneficiaries. Each party hereto intends that this Agreement, except as expressly provided herein, shall not benefit or create any right or cause of action in or on behalf of any person other than the parties hereto.

 

9.10        Governing Law. This Agreement is governed by the internal laws of the State of Delaware without regard to such State’s principles of conflicts of laws that would defer to the substantive laws of another jurisdiction.

 

9.11         Jurisdiction; Service of Process. Any action or proceeding seeking to enforce any provision of, or based on any right arising out of, this Agreement must, to the extent such courts will accept such jurisdiction, be brought against any of the parties in the courts of the State of New York, or, if it has or can acquire jurisdiction, in the United States District Court for the Southern District of New York, and each of the parties consents to the jurisdiction of those courts (and of the appropriate appellate courts) in any such action or proceeding and waives any objection to venue laid therein. Process in any such action or proceeding may be served by sending or delivering a copy of the process to the party to be served at the address and in the manner provided for the giving of notices in Section 9.1. Nothing in this Section 9.11, however, affects the right of any party to serve legal process in any other manner permitted by law.

[Remainder of Page Left Intentionally Blank - Signature Page to Follow]

 

  

18

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first written above by their respective officers.

 

	  	
X-FACTOR COMMUNICATIONS, LLC

	  	  	  
	  	
By:  

	
/s/ Charles Saracino

	  	

Name: Charles Saracino

	  	
Title: Chief Executive Officer

 

	  	
ORGANIC SPICE IMPORTS, INC.

	  	  	  
	  	
By:  

	
/s/ Charles Saracino

	  	

Name: Charles Saracino

	  	
Title: Chief Executive Officer

 

	  	
X-FACTOR ACQUISITION CORP.

	  	  	  
	  	
By:  

	
/s/ Charles Saracino

	  	

Name: Charles Saracino

	  	
Title: President

 

Signature Page

Agreement and Plan of Merger

  

  

  

 

SCHEDULE A

 

Officers and Directors

 

	
Name

	
Title

	
Edwin F. Heinen

	
Chief Financial Officer

	
Ken Makow

	
Chief Technology Officer

	
Brian Watts

	
Chief Information Officer

	
Jeffrey Singman

	
Chief Marketing and Sales Officer

	
Jim Morris

	
Director

	
Louis Siracusano

	
Director

 

  

  

  

 

Exhibit A

Certificate of Merger of Delaware

 

 

STATE OF DELAWARE

CERTIFICATE OF MERGER OF

DOMESTIC CORPORATION AND

FOREIGN LIMITED LIABILITY COMPANY

Pursuant to Title 8, Section 264(c) of the Delaware General Corporation Law, the undersigned limited liability company executed the following Certificate of Merger:

FIRST:          The name of the surviving limited liability company is X-Factor Communications, LLC, a New York limited liability company (the “Surviving Entity”), and the name of the corporation being merged into the Surviving Entity is X-Factor Acquisition Corp., a Delaware Corporation (the “Merging Corporation”).

SECOND:     The Agreement of Merger has been approved, adopted, certified, executed and acknowledged by the Surviving Entity and the Merging Corporation.

THIRD:         The name of the Surviving Entity is X-Factor Communications, LLC.

FOURTH:     The merger is to become effective immediately upon the filing of this certificate of merger.

FIFTH:          The executed Agreement and Plan of Merger is on file at the office of the Surviving Entity, the address of which is 3 Empire Blvd, South Hackensack, NJ 07606.

SIXTH:         A copy of the Agreement of Merger will be furnished by the Surviving Entity, without cost, to any member of the Surviving Entity stock holder of the Merging Corporation.

SEVENTH:   The Surviving Entity agrees that it may be served with process in the State of Delaware in any proceeding for enforcement of any obligation of  any constituent corporation of  Delaware, as well as for enforcement of any obligation of the Surviving Entity arising from this  merger, including any suit or other proceeding to enforce the rights of any stockholders as determined in appraisal proceedings pursuant to the provisions of Section 262 of the Delaware General Corporation laws, and irrevocably appoints the Secretary of State of  Delaware as its agent to accept service of process in any such suit or proceeding.  The Secretary of State shall mail any such process to the surviving limited liability company at 3 Empire Blvd, South Hackensack, NJ 07606.

 

Signature page follows.

  

A-1

  

IN WITNESS WHEREOF, said Limited Liability Company has caused this certificate to be signed by an authorized person, the [__] day of March, 2012.

 

	 	X-FACTOR COMMUNICATIONS, LLC 

By:_______________________________

     Charles Saracino

     Chief Executive Officer and President

 

 

  

A-2

  

 

Exhibit B

Certificate of Merger of New York

 

New York State

Department of State

Division of Corporations, State Records and Uniform Commercial Code

One Commerce Plaza, 99 Washington Avenue

Albany, NY 12231

www.dos.ny.gov

CERTIFICATE OF MERGER

OF

X-FACTOR ACQUISITION CORP.

INTO

X-FACTOR COMMUNICATIONS, LLC

Under Section 1003 of the Limited Liability Company Law

FIRST: The names and jurisdictions of formation or organization of each limited liability company or other business entity that is to merge is:

	
1)  

	
X-Factor Communications, LLC formed in New York

	
2)  

	
X-Factor Acquisition Corp. incorporated in Delaware

SECOND:  The articles of organization of X-Factor Communications, LLC were filed with the Department of State of New York on May 31, 2005.

THIRD:  The original certificate of incorporation of X-Factor Acquisition Corp. was filed in Delaware on March 2, 2012.  An application for authority has not been filed with the Department of State of New York.

FOURTH: The agreement of merger has been approved and executed by each of the constituent entities.

FIFTH: The name of the surviving domestic limited liability company is X-Factor Communications, LLC.

SIXTH: The Secretary of State is designated as agent of the surviving limited liability company upon whom process against it may be served.  The address within or without this state to which the Secretary of State shall mail a copy of any process against the limited liability  company served upon him or her is 3 Empire Blvd, South Hackensack, New Jersey 07606.

SEVENTH: The merger is permitted by the jurisdiction of incorporation of the foreign entity and is in compliance therewith.

EIGHTH: The agreement of merger is on file at the following place of business of the surviving domestic limited liability company: 3 Empire Blvd, South Hackensack, New Jersey 07606.

NINTH: A copy of the agreement of merger will be furnished by the surviving domestic limited liability company on request and without cost to any member of any domestic limited liability company or to any person holding an interest in any other business entity that is to merge pursuant to such agreement.

 

 

	X-FACTOR ACQUISITION CORP. 	 	X-FACTOR COMMUNICATIONS, LLC
	 	 	 	 	 
	By: 	
/s/

	 	By:	
/s/ 

	 	
Name: Charles Saracino  

	 	 	
Name:  Charles Saracino

	 	
Title: Chief Executive Officer and President 

	 	 	
Title: Chief Executive Officer and President

                                                                                                                                                          

  

B-1

  

 

Exhibit C

Cancellation Agreement

 

CANCELLATION AGREEMENT

 

This Cancellation Agreement (this “Agreement”) is made as of the __ day of _________, 2012 by and among Organic Spice Imports, Inc., a Delaware corporation having its offices at 3 Empire Blvd., 5th Floor, South Hackensack, NJ 07606 (the “Company”), and the individuals set forth on Schedule I hereto (the “Securities Holders”).

W I T N E S S E T H:

 

 WHEREAS, the Company entered into an Agreement and Plan of Merger, dated as of March 5, 2012 (the “Merger Agreement”), by and among, the Company, X-Factor Acquisition Corp. (“MergerCo”), a Delaware corporation and wholly owned subsidiary of the Company, and X-Factor Communications, LLC (“X-Factor”), pursuant to which MergerCo shall merge with and into X-Factor, and X-Factor, as the surviving entity, will become the wholly owned subsidiary of the Company (the “Merger”); and

 

WHEREAS, simultaneous with, and as a condition to the closing (the “Closing”) of the transactions contemplated by the Merger Agreement, the Company and the Securities Holders have agreed to cancel (1) an aggregate of 10,000,000 shares of common stock, par value $0.0001 per share (the “Common Stock”) of the Company and (2) warrants to purchase 5,000,000 shares of Common Stock (the “Warrants”, collectively with the Shares, the “Securities”) owned by the Securities Holders as set forth on Schedule I hereto.

 

NOW, THEREFORE, the parties hereto hereby agree as follows:

 

ARTICLE I

CANCELLATION OF SECURITIES

1.1.   Cancellation of the Shares and Warrants.  As an inducement for X-Factor to enter into the transactions contemplated by the Merger Agreement and in reliance upon the representations, warranties, covenants and agreements contained in this Agreement, each Securities Holder and the Company agree that the Securities held by such Securities Holder, as set forth on Schedule I attached hereto, shall be cancelled effective upon the Closing.

 

1.2.   Closing.  At the Closing, the Securities Holders agree to execute any and all additional documents, including but not limited to, stock powers for the stock certificates representing the Shares, as the Company reasonably determines necessary to effect the cancellation of the Securities pursuant to the terms of this Agreement.

 

ARTICLE II

REPRESENTATIONS, WARRANTIES AND COVENANTS

Each of the Securities Holders, individually and solely as to himself, hereby makes the following representations and warranties to and covenants with the Company, which shall be true and correct through the date of the Closing as if made on that date:

 

2.1.   Each Securities Holder has the requisite power and authority to enter into this Agreement and to consummate the transactions contemplated hereby and otherwise to carry out such Securities Holder’s obligations hereunder. No consent, approval or agreement of any individual or entity is required to be obtained by such Securities Holder in connection with the execution and performance by such Securities Holder of this Agreement or the execution and performance by such Securities Holder of any agreements, instruments or other obligations entered into in connection with this Agreement.

 

  

C-1

  

 

2.2.   Such Securities Holder owns the Securities free and clear of any and all liens, claims, encumbrances, preemptive rights, right of first refusal and adverse interests of any kind. Such Securities Holder is not a party to any agreement or understanding pursuant to which any of the Securities held by such Securities Holder are to be transferred.

 

2.3. Such Securities Holder is an accredited investor as defined in Rule 501(a) of Regulation D under the Securities Act of 1933.

2.4.  Such Securities Holder has had had a reasonable opportunity to ask questions of and receive answers from a person or persons acting on behalf of the Company concerning the cancellation of the Securities and the business, financial condition and results of operations of the Company and all such questions have been answered to the full satisfaction of such Securities Holder.

ARTICLE III

TERMINATION

3.1.   Termination by Mutual Agreement.  This Agreement may be terminated at any time prior to the Closing by mutual consent of the parties hereto, provided that such consent to terminate is in writing and is signed by each of the parties hereto.

 

ARTICLE IV

MISCELLANEOUS

4.1.   Entire Agreement.  This Agreement constitutes the entire agreement of the parties, superseding and terminating any and all prior or contemporaneous oral and written agreements, understandings or letters of intent between or among the parties with respect to the subject matter of this Agreement.  No part of this Agreement may be modified or amended, nor may any right be waived, except by a written instrument which expressly refers to this Agreement, states that it is a modification or amendment of this Agreement and is signed by the parties to this Agreement, or, in the case of waiver, by the party granting the waiver.  No course of conduct or dealing or trade usage or custom and no course of performance shall be relied on or referred to by any party to contradict, explain or supplement any provision of this Agreement, it being acknowledged by the parties to this Agreement that this Agreement is intended to be, and is, the complete and exclusive statement of the agreement with respect to its subject matter.  Any waiver shall be limited to the express terms thereof and shall not be construed as a waiver of any other provisions or the same provisions at any other time or under any other circumstances.

 

4.2.   Severability.  If any section, term or provision of this Agreement shall to any extent be held or determined to be invalid or unenforceable, the remaining sections, terms and provisions shall nevertheless continue in full force and effect.

 

4.3.   Notices.  All notices provided for in this Agreement shall be in writing signed by the party giving such notice, and delivered personally or sent by overnight courier, mail or messenger against receipt thereof or sent by registered or certified mail, return receipt requested, or by facsimile transmission or similar means of communication if receipt is confirmed or if transmission of such notice is confirmed by mail as provided in this Section 4.3.  Notices shall be deemed to have been received on the date of personal delivery or telecopy or attempted delivery.  Notice shall be delivered to the parties at the following addresses:

 

  

C-2

  

If to the Company:               Organic Spice Imports, Inc.

3 Empire Blvd., 5th Floor

South Hackensack, NJ 07606

Attn: Charles Saracino, Chief Executive Officer

If to Securities Holders:      to the address set forth on Schedule I.

Either party may, by like notice, change the address, person or telecopier number to which notice shall be sent.

 

4.4.   Governing Law.  This Agreement shall be governed and construed in accordance with the laws of the State of Delaware applicable to agreements executed and to be performed wholly within such State, without regard to any principles of conflicts of law.

 

4.5.   Waiver of Jury Trial.  EACH PARTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN THE EVENT OF ANY SUIT, ACTION OR PROCEEDING TO ENFORCE THIS AGREEMENT OR ANY OTHER ACTION OR PROCEEDING WHICH MAY ARISE OUT OF OR IN ANY WAY BE CONNECTED WITH THIS AGREEMENT OR ANY OF THE OTHER DOCUMENTS.

 

4.6.   Successors.  This Agreement shall be binding upon the parties and their respective heirs, executors, administrators, legal representatives, successors and permitted assigns; provided, however, that no party may assign this Agreement or any of its rights under this Agreement without the prior written consent of the other parties.

 

4.7.   Further Assurances.  Each party to this Agreement agrees, without cost or expense to any other party, to deliver or cause to be delivered such other documents and instruments as may be reasonably requested by any other party to this Agreement in order to carry out more fully the provisions of, and to consummate the transaction contemplated by, this Agreement.

 

4.8.   Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

 

4.9.   No Strict Construction.  The language used in this Agreement will be deemed to be the language chosen by the parties with the advice of counsel to express their mutual intent, and no rules of strict construction will be applied against any party.

 

4.10.   Headings.  The headings in the Sections of this Agreement are inserted for convenience only and shall not constitute a part of this Agreement.

 

[Remainder of this page intentionally left blank.]

  

C-3

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

	  	
 

ORGANIC SPICE IMPORTS, INC.

	  	  
	  	
By:  ______________________________

	  	
         Charles Saracino

         Chief Executive Officer

 

	  	  
	  	
SECURITIES HOLDERS

 

________________________________

Randle Kenilworth

 

___________________________________

Peter Quigley

 

___________________________________

Donald J. Wright

 

  

C-4

  

SCHEDULE I

	
Securities Holder

	
No. of Shares

	
No. of Warrants

	
 

Peter Quigley

Ch. des Cuttermers

 2 Founex

Switzerland 1297

 

	
3,745,762

	
1,694,916

	
 

Randle Kenilworth

3 Palmerston Court

London SW8 4AJ

 

	
3,745,763

	
1,694,915

	
 

Donald J. Wright

Grinian House                                           

St. Leonards Rd

Forres IV36 2RE

 

	
3,558,475

	
1,610,169

 C-5Exhibit 4.4

WARRANT AGREEMENT

 

THIS WARRANT AGREEMENT (this “Agreement”), dated as of _____________, 2012, is by and between BGS Acquisition Corp., a British Virgin Islands business company (the “Company”), and Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agent”).

 

WHEREAS, the Company has entered into that certain warrants purchase agreement with certain initial investors listed on the signature page thereto (each, a “Warrant Investor”) pursuant to which the Warrant Investors will purchase an aggregate of 3,000,000 warrants (the “Investor Warrants”) of the Company, bearing the legend set forth in Exhibit B hereto, at a purchase price of $0.75 per Investor Warrant, to be sold to the Warrant Investors simultaneously with the closing of the Offering (as defined below);

 

WHEREAS, the Company has entered into that certain warrants purchase agreement with PrinceRidge (defined below) and/or its designees (the “Underwriter Investors” and, together with the Warrant Investors, the “Initial Investors”) pursuant to which the Underwriter Investors will purchase an aggregate of 300,000 warrants of the Company (the “Underwriter Warrants” and, together with the Investor Warrants, the “PlacementWarrants”), bearing the legend set forth in Exhibit B hereto, at a purchase price of $0.75 per Underwriter Warrant, to be sold to the Underwriter Investors simultaneously with the closing of the Offering;

 

WHEREAS, the Company is engaged in an initial public offering (the “Offering”) of up to 5,175,000 units (the “Units”) of the Company’s equity securities (including up to 675,000 Units subject to the Over-allotment Option (as defined below)), each such unit comprised of one ordinary share, no par value (the “Ordinary Shares”), of the Company and one warrant evidencing the right of the holder thereof to purchase one Ordinary Share for $10.00 per share, subject to adjustment as described herein (such warrants, the “Public Warrants”);

 

WHEREAS, in connection with the Offering, the Company has granted a unit purchase option (the “UPO”) to The PrinceRidge Group LLC (“PrinceRidge”) for $100 to acquire 382,500 units (“UPO Units”) at $15.00 per unit. The UPO Units are identical to the Units and each UPO Unit consists of one Ordinary Share and one warrant to purchase one Ordinary Share for $10.00 per share, subject to adjustment as described herein (the “UPO Warrants”, and, together with the Placement Warrants and the Public Warrants, the “Warrants”);

 

WHEREAS, the Company has filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form F-1, No. 333-178780 (the “Registration Statement”), for the registration, under the Securities Act of 1933, as amended (the “Securities Act”), of the Units, the Public Warrants (including Ordinary Shares underlying the Public Warrants) and Ordinary Shares included in the Units, the UPO Units (including Ordinary Shares included in the UPO Units and Ordinary Shares underlying the UPO Warrants),and a related prospectus (the “Prospectus”); and

 

WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration, transfer, exchange, redemption and exercise of the Warrants; and

 

  

1

  

 

WHEREAS, the Company desires to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights, limitation of rights, and immunities of the Company, the Warrant Agent, and the holders of the Warrants; and

 

WHEREAS, all acts and things have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or on behalf of the Warrant Agent, as provided herein, the valid, binding and legal obligations of the Company, and to authorize the execution and delivery of this Agreement.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, the parties hereto agree as follows:

 

1.   Appointment of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.

 

2.   Warrants.

 

2.1   Form of Warrant. Each Warrant shall be issued in registered form only and shall be in substantially the form of Exhibit A hereto, the provisions of which are incorporated herein and shall be signed by, or bear the facsimile signature of, the Chairman of the Board, President, Chief Executive Officer, Chief Financial Officer, Secretary or other principal officer of the Company. In the event the person whose facsimile signature has been placed upon any Warrant shall have ceased to serve in the capacity in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect as if he or she had not ceased to be such at the date of issuance.

 

2.2   Effect of Countersignature. Unless and until countersigned by the Warrant Agent pursuant to this Agreement, a Warrant shall be invalid and of no effect and may not be exercised by the holder thereof.

 

2.3   Registration.

 

2.3.1   Warrant Register. The Warrant Agent shall maintain books (the “Warrant Register”), for the registration of original issuance and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants, the Warrant Agent shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance with instructions delivered to the Warrant Agent by the Company.

 

2.3.2   Registered Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat the person in whose name such Warrant is registered in the Warrant Register (the “Registered Holder”) as the absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on the Warrant Certificate (as defined below) made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

 

  

2

  

 

2.4   Detachability of Warrants. The Ordinary Shares and Public Warrants comprising the Units shall begin separate trading on the tenth (10th) Business Day (as defined below) following the earlier to occur of the expiration of the underwriters’ option to purchase additional Units in the Offering which expiration shall occur forty-five (45) days from the effective date of the Registration Statement (the “Over-allotment Option”), the exercise in full of the Over-allotment Option or the announcement by PrinceRidge, as representatives of the several underwriters (the “Representative”), of its intention not to exercise all or any remaining portion of the Over-allotment Option (such date, the “Detachment Date”), but in no event shall the Ordinary Shares and the Public Warrants comprising the Units be separately traded until (A) the Company has filed a Form 6-K with the Commission containing an audited balance sheet reflecting the receipt by the Company of the gross proceeds of the Offering, including the proceeds received by the Company from the exercise by the Representative of the Over-allotment Option, if the Over-allotment Option is exercised prior to the filing of the Form 6-K, and (B) the Company issues a press release and files with the Commission a Form 6-K announcing when such separate trading shall begin. “Business Day” shall mean any day, other than a Saturday, Sunday or federal holiday, on which banks in New York City are generally open for normal business.

 

2.5   Placement Warrants Attributes.  The Placement Warrants shall be identical to the Public Warrants, except that so long as they are held by the Initial Investors or any of their Permitted Transferees (as defined below), the Placement Warrants: (i) may not be transferred, assigned or sold until thirty (30) days after the completion by the Company of an initial Business Combination (as defined below), except in a transfer to Permitted Transferees (as defined below) in accordance with this Section 2.5, and (ii) shall not be redeemable by the Company. In addition, the Underwriter Warrants, for so long as such Warrants are held by the Underwriter Investors, may not be exercised after the five year anniversary of the effective date of the Registration Statement. Pursuant to Rule 5110(g)(1) of the FINRA Manual, for a period of 180 days immediately following the date of effectiveness of the Registration Statement, the Underwriter Investors also shall not directly or indirectly, offer, sell, agree to offer or sell, transfer, assign, pledge, hypothecate or subject to hedging, short sale, derivative, put or call transaction, the Underwriter Warrants (and the Ordinary Shares issued or issuable upon exercise of the Underwriter Warrants) to anyone other than (i) an underwriter or a selected dealer participating in the IPO or (ii) any bona fide successor, officer or partner of PrinceRidge or of any such underwriter or selected dealer (such lock-up, the “FINRA Lock-up”). Notwithstanding the limitations in clause (ii) above (but in all instances subject to the FINRA Lock-up in respect of the Underwriter Warrants and the Ordinary Shares issued or issuable upon exercise of the Underwriter Warrants), the Placement Warrants and any Ordinary Shares issued upon exercise of such Placement Warrants held by the Initial Investors may be transferred by the Initial Investors:

 

(a) as gift, as applicable to such person’s immediate family or to a trust, the beneficiary of which is a member of such person’s immediate family, or an affiliate, agent or employee, designee of such person or entity or to a charitable organization,

 

(b) to the Company’s officers or directors, any affiliate or family member of any of the Company’s officers or directors, any other Initial Investor or any affiliate, agent or employee, designee of such person or entity,

 

(c) by virtue of the laws of descent and distribution upon death of such person or dissolution of such entity,

 

(d) pursuant to a qualified domestic relations order,

 

  

3

  

 

(e) in the event of the Company’s liquidation prior to the completion of the Company’s initial Business Combination, or

 

(f) in the event that, subsequent to the consummation of the Company’s initial Business Combination, the Company consummates a merger, stock exchange or other similar transaction that results in all of the holders of the Company’s equity securities issued in the Offering having the right to exchange their Ordinary Shares for cash, securities or other property;  provided, however, that, in the case of clauses (a) through (e), these transferees (the “Permitted Transferees”) enter into a written agreement with the Company agreeing to be bound by the transfer restrictions in this Agreement.

 

3.   Terms and Exercise of Warrants.

 

3.1   Warrant Price. Each Warrant shall, when countersigned by the Warrant Agent, entitle the Registered Holder thereof, subject to the provisions of such Warrant and of this Agreement, to purchase from the Company the number of Ordinary Shares stated therein, at the price of $10.00 per share, subject to the adjustments provided in Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant Price” as used in this Warrant Agreement shall mean the price at which an Ordinary Share may be purchased at the time a Warrant is exercised. The Company in its sole discretion may lower the Warrant Price at any time prior to the Expiration Date (as defined below) for a period of not less than twenty (20) Business Days; provided, that the Company shall provide at least twenty (20) days prior written notice of such reduction to Registered Holders of the Warrants; and provided further that any such reduction shall be identical among all of the Warrants.

 

3.2   Duration of Warrants. A Warrant may be exercised only during the period (the “Exercise Period”) commencing on the later of: (i) the date that is thirty (30) days after the first date on which the Company completes an initial acquisition, share exchange, share reconstruction and amalgamation or contractual control arrangement with, or purchase of, all or substantially all of the assets of, or engaging in any other similar business combination with, one or more businesses (a “Business Combination”), or (ii) the date that is twelve (12) months from the date of the closing of the Offering, and terminating at 5:00 p.m., New York City time on the earlier to occur of: (x) the date that is five (5) years after the date on which the Company completes its initial Business Combination, (y) the liquidation of the Company, or if the Company fails to consummate a Business Combination on or prior to the 18 month anniversary of the closing of the Offering, or (z) other than with respect to the Placement Warrants, the Redemption Date (as defined below) as provided in Section 6.2 hereof (the “Expiration Date”); provided, however, that the exercisability of any Warrant shall be subject to the satisfaction of any applicable conditions, as set forth in subsection 3.3.2 below with respect to an effective post-effective amendment or new registration statement and current prospectus in respect of the Ordinary Shares underlying the Public Warrants; and, provided, further, that the Underwriter Warrants, for so long as such Warrants are held by the Underwriter Investors, may not be exercised after the five year anniversary of the effective date of the Registration Statement.  Except with respect to the right to receive the Redemption Price (other than with respect to a Placement Warrant) in the event of a redemption (as set forth in Section 6 hereof), each Warrant (other than a Placement Warrant) not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights in respect thereof under this Agreement shall cease at 5:00 p.m., New York City time, on the Expiration Date. The Company in its sole discretion may extend the duration of the Warrants by delaying the Expiration Date; provided, that the Company shall provide at least twenty (20) days prior written notice of any such extension to the Registered Holders of the Warrants; and provided further that any such extension shall be identical in duration among all the Warrants.

 

  

4

  

 

3.3   Exercise of Warrants.

 

3.3.1   Payment. Subject to the provisions of the Warrant and this Agreement, a Warrant, when countersigned by the Warrant Agent, may be exercised by the Registered Holder thereof by surrendering it, at the office of the Warrant Agent, or at the office of its successor as Warrant Agent, in the Borough of Manhattan, City and State of New York, with the subscription form, as set forth in the Warrant, duly executed, and by paying in full the Warrant Price for each full Ordinary Share as to which the Warrant is exercised and any and all applicable taxes due in connection with the exercise of the Warrant, the exchange of the Warrant for the Ordinary Shares and the issuance of such Ordinary Shares, as follows:

 

(a) by wire transfer of immediately available funds in lawful money of the United States, payable to the order of the Company; and

 

(b) as provided in Section 7.4 hereof.

 

3.3.2   Issuance of Ordinary Shares on Exercise. As soon as practicable after the exercise of any Warrant and the clearance of the funds in payment of the Warrant Price (if payment is pursuant to subsection 3.3.1(a)) but in no case less than three business days after, the Company shall issue to the Registered Holder of such Warrant a certificate or certificates for the number of Ordinary Shares to which he, she or it is entitled, registered in such name or names as may be directed by him, her or it, and if such Warrant shall not have been exercised in full, a new countersigned Warrant for the number of shares as to which such Warrant shall not have been exercised. Notwithstanding the foregoing, the Company shall not be obligated to deliver any Ordinary Shares pursuant to the exercise of a Warrant and shall have no obligation to settle such Warrant exercise unless a post-effective amendment to the Registration Statement or a new registration statement under the Securities Act with respect to the Ordinary Shares underlying the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company’s obligations under Section 7.4.  In no event will the Company be required to net cash settle the Warrant exercise.

 

3.3.3   Valid Issuance. All Ordinary Shares issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly issued, fully paid and nonassessable.

 

3.3.4   Date of Issuance. Each person in whose name any certificate for Ordinary Shares is issued shall for all purposes be deemed to have become the holder of record of such Ordinary Shares on the date on which the Warrant was surrendered and payment of the Warrant Price was made, irrespective of the date of delivery of such certificate, except that, if the date of such surrender and payment is a date when the share transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the share transfer books are open.

 

  

5

  

 

3.3.5   Maximum Percentage. A holder of a Warrant shall notify the Company in writing in the event it elects to be subject to the provisions contained in this subsection 3.3.5; provided, however, that no holder of a Warrant shall be subject to this subsection 3.3.5 unless he, she or it makes such election. If the election is made by a holder, the Warrant Agent shall not effect the exercise of the holder’s Warrant, and such holder shall not have the right to exercise such Warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the Warrant Agent’s actual knowledge, would beneficially own in excess of 9.9% (the “Maximum Percentage”) of the Ordinary Shares outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of Ordinary Shares beneficially owned by such person and its affiliates shall include the number of Ordinary Shares issuable upon exercise of the Warrant with respect to which the determination of such sentence is being made, but shall exclude Ordinary Shares that would be issuable upon (x) exercise of the remaining, unexercised portion of the Warrant beneficially owned by such person and its affiliates and (y) exercise or conversion of the unexercised or unconverted portion of any other securities of the Company beneficially owned by such person and its affiliates (including, without limitation, any convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). For purposes of the Warrant, in determining the number of outstanding Ordinary Shares, the holder may rely on the number of outstanding Ordinary Shares as reflected in (1) the Company’s most recent Form 20-F, Form 6-K or other public filing with the Commission as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or the transfer agent for the Ordinary Shares (the “Transfer Agent”) setting forth the number of Ordinary Shares outstanding. For any reason at any time, upon the written request of the holder of the Warrant, the Company shall, within two (2) Business Days, confirm orally and in writing to such holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of equity securities of the Company by the holder and its affiliates since the date as of which such number of outstanding Ordinary Shares was reported. By written notice to the Company, the holder of a Warrant may from time to time increase or decrease the Maximum Percentage applicable to such holder to any other percentage specified in such notice; provided, however, that any such increase shall not be effective until the sixty-first (61st) day after such notice is delivered to the Company.

 

4.   Adjustments.

 

4.1   Share Dividends.

 

4.1.1   Split-Ups. If after the date hereof, and subject to the provisions of Section 4.6 below, the number of outstanding Ordinary Shares is increased by a share dividend payable in Ordinary Shares, or by a split-up of Ordinary Shares or other similar event, then, on the effective date of such share dividend, split-up or similar event, the number of Ordinary Shares issuable on exercise of each Warrant shall be increased in proportion to such increase in the number of outstanding Ordinary Shares. A rights offering to holders of the Ordinary Shares entitling holders to purchase Ordinary Shares at a price less than the “Fair Market Value” (as defined below) shall be deemed a share dividend of a number of Ordinary Shares equal to the product of (i) the number of Ordinary Shares actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for Ordinary Shares) multiplied by (ii) one (1) minus the quotient of: (x) the price per Ordinary Share paid in such rights offering divided by (y) the Fair Market Value. For purposes of this subsection 4.1.1, (i) if the rights offering is for securities convertible into or exercisable for Ordinary Shares, in determining the price payable for the Ordinary Shares, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means, for purposes of this subsection 4.1.1 only, the volume weighted average price of the Ordinary Shares as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the Ordinary Shares trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

 

  

6

  

 

4.1.2   Extraordinary Dividends. If the Company, at any time while the Warrants are outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of the Ordinary Shares on account of such Ordinary Shares (or other shares of the Company’s capital stock into which the Warrants are convertible), other than (a) as described in subsection 4.1.1 above, (b) Ordinary Cash Dividends (as defined below), (c) to satisfy the redemption rights of the holders of the Ordinary Shares in connection with a proposed initial Business Combination, (d) as a result of the repurchase of Ordinary Shares by the Company if a proposed initial Business Combination is presented to the shareholders of the Company for approval or (e) in connection with the Company’s liquidation and the distribution of its assets upon its failure to consummate a Business Combination (any such non- excluded event being referred to herein as an “Extraordinary Dividend”), then the Warrant Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and/or the fair market value (as determined by the Board, in good faith) of any securities or other assets paid on each Ordinary Shares in respect of such Extraordinary Dividend. For purposes of this subsection 4.1.2, “Ordinary Cash Dividends” means any cash dividend or cash distribution which, when combined on a per Ordinary Share basis, with the per share amounts of all other cash dividends and cash distributions paid on the Ordinary Shares during the 365-day period ending on the date of declaration of such dividend or distribution (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 4 and excluding cash dividends or cash distributions that resulted in an adjustment to the Warrant Price or to the number of Ordinary Shares issuable on exercise of each Warrant) does not exceed $0.50 (being 5% of the offering price of the Units in the Offering).

 

4.2   Aggregation of Shares. If after the date hereof, and subject to the provisions of Section 4.6 hereof, the number of outstanding Ordinary Shares is decreased by a consolidation, combination, reverse share split or reclassification of Ordinary Shares or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of Ordinary Shares issuable on exercise of each Warrant shall be decreased in proportion to such decrease in the number of outstanding Ordinary Shares.

 

4.3   Adjustments in Exercise Price. Whenever the number of Ordinary Shares purchasable upon the exercise of the Warrants is adjusted, as provided in subsection 4.1.1 or 4.2 above, the Warrant Price shall be adjusted (to the nearest cent) by multiplying such Warrant Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of Ordinary Shares purchasable upon the exercise of the Warrants immediately prior to such adjustment, and (y) the denominator of which shall be the number of Ordinary Shares so purchasable immediately thereafter.

 

  

7

  

 

4.4           Replacement of Securities upon Reorganization, etc. If, at any time while this Warrant is outstanding (i) the Company effects (A) any merger of the Company with (but not into) another Person, in which shareholders of the Company, measured immediately prior to the consummation of such transaction, consequently own less than a majority of the outstanding stock of the surviving entity, or (B) any merger or consolidation of the Company into another Person, (ii) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange offer approved or authorized by the Company’s Board of Directors is completed pursuant to which holders of at least a majority of the outstanding Ordinary Shares tender or exchange their shares for other securities, cash or property, or (iv) the Company effects any reclassification of the Ordinary Shares or any compulsory share exchange pursuant to which the Ordinary Shares are effectively converted into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of Ordinary Shares covered elsewhere in this Section 4) (in any such case, a “Fundamental Transaction”), then the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Warrant Shares then issuable upon exercise in full of this Warrant without regard to any limitations on exercise contained herein (the “Alternate Consideration”), and the Holder shall no longer have the right to receive Warrant Shares upon exercise of this Warrant. Notwithstanding anything to the contrary contained herein, the provisions of this section shall not be deemed to apply to, and no Fundamental Transaction shall be deemed to have occurred in connection with, any Business Combination.  The Company shall not effect any such Fundamental Transaction unless prior to or simultaneously with the consummation thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or Person shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing provisions, the Holder may be entitled to receive, and the other obligations under this Warrant. The provisions of this section 4.4 shall similarly apply to subsequent transactions of an analogous type to any Fundamental Transaction. Notwithstanding the foregoing, in the event of a Fundamental Transaction, then at the request of the Holder delivered at any time commencing on the earliest to occur of (x) the public disclosure of any Fundamental Transaction, (y) the consummation of any Fundamental Transaction and (z) the Holder first becoming aware of any Fundamental Transaction through the date that is 90 days after the public disclosure of the consummation of such Fundamental Transaction by the Company pursuant to a Current Report on Form 8-K filed with the SEC, the Company (or the successor entity to the Company) shall purchase this Warrant from the Holder by paying to the Holder, within five Trading Days after such request (or, if later, on the effective date of the Fundamental Transaction), cash in an amount equal to the Black Scholes Value of the remaining unexercised portion of this Warrant on the date of such Fundamental Transaction.  Any Holder that receives cash pursuant to the immediately preceding sentence shall not receive any Alternate Consideration.  For purposes hereof, “Black Scholes Value” means the value of the Warrant based on the Black Scholes Option Pricing Model obtained from the “OV” function on Bloomberg  using (i) a price per Ordinary Share equal to the Closing Sale Price of the Ordinary Shares for the Trading Day immediately preceding the date of consummation of the applicable Fundamental Transaction, (ii) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term of this Warrant as of such date of request, (iii) an expected volatility equal to the greater of (A) forty percent (40%) and (B) the 30-day volatility obtained from the HVT function on Bloomberg determined as of the Trading Day immediately following the announcement of the Fundamental Transaction, (iv) a “Style” of “Warrant” and (v) a “Warrant type” of “Capped” where “Call cap” equals $16.50, subject to adjustment under Section 4.1.

 

4.5   Notices of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant, the Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of a Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3 or 4.4, the Company shall give written notice of the occurrence of such event to each holder of a Warrant, at the last address set forth for such holder in the Warrant Register, of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.

 

  

8

  

 

4.6   No Fractional Shares. Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue fractional shares upon exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise, round up to the nearest whole number, the number of Ordinary Shares to be issued to such holder.

 

4.7   Form of Warrant. The form of Warrant need not be changed because of any adjustment pursuant to this Section 4, and Warrants issued after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrants initially issued pursuant to this Agreement; provided, however, that the Company may at any time in its sole discretion make any change in the form of Warrant that the Company may deem appropriate and that does not affect the substance thereof, and any Warrant thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant or otherwise, may be in the form as so changed.

 

4.8   Other Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 4 are strictly applicable, but which would require an adjustment to the terms of the Warrants in order to (i) avoid an adverse impact on the Warrants and (ii) effectuate the intent and purpose of this Section 4, then, in each such case, the Company shall appoint a firm of independent public accountants, investment banking or other appraisal firm of recognized national standing, which shall give its opinion as to whether or not any adjustment to the rights represented by the Warrants is necessary to effectuate the intent and purpose of this Section 4 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust the terms of the Warrants in a manner that is consistent with any adjustment recommended in such opinion.

 

5.   Transfer and Exchange of Warrants.

 

5.1   Registration of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register, upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant shall be cancelled by the Warrant Agent. The Warrants so cancelled shall be delivered by the Warrant Agent to the Company from time to time upon request.

 

5.2   Procedure for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer, and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the Registered Holder of the Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that in the event that a Warrant surrendered for transfer bears a restrictive legend (as in the case of the Placement Warrants), the Warrant Agent shall not cancel such Warrant and issue new Warrants in exchange thereof until the Warrant Agent has received an opinion of counsel for the Company stating that such transfer may be made and indicating whether the new Warrants must also bear a restrictive legend.

 

  

9

  

 

5.3   Fractional Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which shall result in the issuance of a warrant certificate for a fraction of a warrant.

 

5.4   Service Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.

 

5.5   Warrant Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company, whenever required by the Warrant Agent, shall supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.

 

5.6   Transfer of Warrants. Prior to the Detachment Date, the Public Warrants may be transferred or exchanged only together with the Unit in which such Warrant is included, and only for the purpose of effecting, or in conjunction with, a transfer or exchange of such Unit. Furthermore, each transfer of a Unit on the register relating to such Units shall operate also to transfer the Warrants included in such Unit. Notwithstanding the foregoing, the provisions of this Section 5.6 shall have no effect on any transfer of Warrants on and after the Detachment Date.

 

6.   Redemption.

 

6.1   Redemption. Subject to Section 6.4 hereof, not less than all of the outstanding Warrants may be redeemed, at the option of the Company, at any time while they are exercisable and prior to their expiration, at the office of the Warrant Agent, upon notice to the Registered Holders of such Warrants, as described in Section 6.2 below, at the price of $0.01 per Warrant (the “Redemption Price”); provided that the last sales price of the Ordinary Shares reported has been at least $16.50 per share (subject to adjustment in compliance with Section 4 hereof), on each of twenty (20) trading days within the thirty (30) trading-day period ending on the third Business Day prior to the date on which notice of the redemption is given; and provided further that there is an effective post-effective amendment or new registration statement covering the Ordinary Shares issuable upon exercise of the Warrants, and a current prospectus relating thereto, available throughout the 30-day Redemption Period (as defined in Section 6.2 below); provided, however, in the event there was no actual trading of the Ordinary Shares for any day within such twenty (20) trading day period, then the closing bid price on such day must exceed $16.50 per share.

 

6.2   Date Fixed for, and Notice of, Redemption. In the event that the Company elects to redeem all of the Warrants pursuant to Section 6.1, the Company shall fix a date for the redemption (the “Redemption Date”). Notice of redemption shall be mailed by first class mail, postage prepaid, by the Company not less than thirty (30) days prior to the Redemption Date (such 30 day period, the “Redemption Period”) to the Registered Holders of the Warrants to be redeemed at their last addresses as they shall appear on the registration books. Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly given whether or not the Registered Holder received such notice.

 

6.3   Exercise After Notice of Redemption. Subject to the provisions of this Section 6.3, the Warrants may be exercised, for cash at any time after notice of redemption shall have been given by the Company pursuant to Section 6.2 hereof and prior to the Redemption Date. On and after the Redemption Date, the record holder of the Warrants shall have no further rights except to receive, upon surrender of the Warrants, the Redemption Price.

 

  

10

  

 

6.4   Exclusion of Placement Warrants. The Company agrees that the redemption rights provided in this Section 6 shall not apply to the Placement Warrants if at the time of the redemption such Placement Warrants continue to be held by the Initial Investors or their Permitted Transferees. Once such Placement Warrants are transferred (other than to Permitted Transferees under subsection 2.5), the Company may redeem the Placement Warrants, provided that the criteria for redemption are met, including the opportunity of the holder of such Placement Warrants to exercise the Placement Warrants prior to redemption pursuant to Section 6.3. Placement Warrants that are transferred to persons other than Permitted Transferees shall upon such transfer cease to be Placement Warrants and shall become Public Warrants under this Agreement.

 

7.   Other Provisions Relating to Rights of Holders of Warrants.

 

7.1   No Rights as Shareholder. A Warrant does not entitle the Registered Holder thereof to any of the rights of a shareholder of the Company, including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent or to receive notice as shareholders in respect of the meetings of shareholders or the election of directors of the Company or any other matter.

 

7.2   Lost, Stolen, Mutilated, or Destroyed Warrants. If any Warrant is lost, stolen, mutilated, or destroyed, the Company and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination, tenor, and date as the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute a substitute contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by any person.

 

7.3   Reservation of Ordinary Shares. The Company shall at all times reserve and keep available a number of its authorized but unissued Ordinary Shares that shall be sufficient to permit the exercise in full of all outstanding Warrants issued pursuant to this Agreement.

 

7.4   Registration of Ordinary Shares. The Company agrees that as soon as practicable, but in no event later than fifteen (15) Business Days after the closing of its initial Business Combination, it shall use its best efforts to file with the Commission a post-effective amendment to the Registration Statement or a new registration statement, for the registration, under the Securities Act, of the Ordinary Shares issuable upon exercise of the Warrants, and it shall use its best efforts to take such action as is necessary to register or qualify for sale, in those states in which the Warrants were initially offered by the Company, the Ordinary Shares issuable upon exercise of the Warrants. The Company shall use its best efforts to cause such above referenced Commission and state registration(s) to become effective and to maintain the effectiveness of such post-effective amendment or registration statement, and a current prospectus relating thereto, until the expiration of the Warrants in accordance with the provisions of this Agreement. If any such a post-effective amendment or registration statement has not been declared effective or a prospectus relating thereto has not been filed by the sixtieth (60) Business Day following the closing of the Business Combination, holders of the Warrants shall

 

  

11

  

 

statement is declared effective by, and the prospectus relating thereto has been filed with, the Commission, and during any other period when the Company shall fail to have maintained an effective post-effective amendment or registration statement or a current prospectus covering the Ordinary Shares issuable upon exercise of the Warrants, to exercise such Warrants on a “cashless basis,” by exchanging the Warrants (in accordance with Section 3(a)(9) of the Securities Act or another exemption) for that number of Ordinary Shares equal to the quotient obtained by dividing (x) the product of the number of Ordinary Shares underlying the Warrants, multiplied by the difference between the Warrant Price and the “Fair Market Value” (as defined below) by (y) the Fair Market Value. Solely for purposes of this Section 7.4, “Fair Market Value” shall mean the volume weighted average price of the Ordinary Shares as reported during the ten (10) trading day period ending on the trading day prior to the date that notice of exercise is received by the Warrant Agent from the holder of such Warrants or its securities broker or intermediary. The date that the notice of cashless exercise is received by the Warrant Agent shall be conclusively determined by the Warrant Agent. The Company shall provide the Warrant Agent with an opinion of counsel for the Company (which shall be an outside law firm with securities law experience) stating that (i) the exercise of the Warrants on a cashless basis in accordance with this Section 7.4 is not required to be registered under the Securities Act and (ii) the Ordinary Shares issued upon such exercise shall be freely tradable under United States federal securities laws by anyone who is not an affiliate (as such term is defined in Rule 144 under the Securities Act) of the Company and, accordingly, shall not be required to bear a restrictive legend. For the avoidance of any doubt, unless and until all of the Warrants have been exercised on a cashless basis, the Company shall continue to be obligated to comply with its registration obligations under the first three sentences of this Section 7.4. In addition, the Company agrees to use its best efforts to register the Ordinary Shares issuable upon exercise of a Warrant under the blue sky laws of the states of residence of the exercising Warrant holder to the extent an exemption is not available.

 

7.5   Listing of Warrants.  The Company agrees to maintain the listing of the warrants on the same exchange as the listing of the Ordinary Shares for so long as the Warrants remain outstanding.

 

8.   Concerning the Warrant Agent and Other Matters.

 

8.1   Payment of Taxes. The Company shall from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant Agent in respect of the issuance or delivery of Ordinary Shares upon the exercise of the Warrants, but the Company shall not be obligated to pay any transfer taxes in respect of the Warrants or such shares.

 

8.2   Resignation, Consolidation, or Merger of Warrant Agent.

 

8.2.1   Appointment of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of a Warrant (who shall, with such notice, submit his Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost. Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a 

 

  

12

  

 

corporation organized and existing under the laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York, and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority. After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed; but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers, rights, immunities, duties, and obligations.

 

8.2.2   Notice of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the predecessor Warrant Agent and the Transfer Agent for the Ordinary Shares not later than the effective date of any such appointment.

 

8.2.3   Merger or Consolidation of Warrant Agent. Any corporation into which the Warrant Agent may be merged or with which it may be consolidated or any corporation resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under this Agreement without any further act.

 

8.3   Fees and Expenses of Warrant Agent.

 

8.3.1   Remuneration. The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder and shall, pursuant to its obligations under this Agreement, reimburse the Warrant Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.

 

8.3.2   Further Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying out or performing of the provisions of this Agreement.

 

8.4   Liability of Warrant Agent.

 

8.4.1   Reliance on Company Statement. Whenever in the performance of its duties under this Warrant Agreement, the Warrant Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a statement signed by the President or Chairman of the Board of the Company and delivered to the Warrant Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions of this Agreement.

 

8.4.2   Indemnity. The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct or bad faith. The Company agrees to indemnify the Warrant Agent and save it harmless against any and all liabilities, including judgments, costs and reasonable counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement, except as a result of the Warrant Agent’s gross negligence, willful misconduct or bad faith.

 

  

13

  

 

8.4.3   Exclusions. The Warrant Agent shall have no responsibility with respect to the validity of this Agreement or with respect to the validity or execution of any Warrant (except its countersignature thereof). The Warrant Agent shall not be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in any Warrant. The Warrant Agent shall not be responsible to make any adjustments required under the provisions of Section 4 hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any Ordinary Shares to be issued pursuant to this Agreement or any Warrant or as to whether any Ordinary Shares shall, when issued, be valid and fully paid and nonassessable.

 

8.5   Acceptance of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently account for, and pay to the Company, all monies received by the Warrant Agent for the purchase of Ordinary Shares through the exercise of the Warrants.

 

8.6   Waiver. The Warrant Agent has no right of set-off or any other right, title, interest or claim of any kind (“Claim”) in, or to any distribution of, the Trust Account (as defined in that certain Investment Management Trust Agreement, dated as of the date hereof, by and between the Company and the Warrant Agent as trustee thereunder) and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason whatsoever. The Warrant Agent hereby waives any and all Claims against the Trust Account and any and all rights to seek access to the Trust Account.

 

9.   Miscellaneous Provisions.

 

9.1   Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the benefit of their respective successors and assigns.

 

9.2   Notices. Any notice, statement or demand authorized by this Warrant Agreement to be given or made by the Warrant Agent or by the holder of any Warrant to or on the Company shall be sufficiently given (i) when so delivered if by hand or overnight delivery; (ii) upon receipt of by the intended recipient, if sent by facsimile, as evidenced by the date and time shown on the facsimile transmission confirmation, or (iii) if sent by certified mail, or private courier service within five (5) days after deposit of such notice, postage prepaid.  Such notice, statement or demand shall be addressed (until another address is filed in writing by the Company with the Warrant Agent), as follows:

 

BGS Acquisition Corp.

152 West 57th Street

34th Floor

New York, NY 10019

Attention: Chief Executive Officer

Email: cesar@baez.com

 

  

14

  

 

with a copy in each case (which shall not constitute service) to:

 

Ellenoff Grossman & Schole LLP

150 East 42nd Street

New York, NY 10017

Attn:  Douglas S. Ellenoff, Esq.

Fax: (212) 370-7889

 

If to the Warrant Agent:

 

Continental Stock Transfer & Trust Company

17 Battery Place

New York, New York 10004

Attention: Compliance Department

Fax: (212) 509-5150

 

9.3   Applicable Law. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.  The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. The Company hereby appoints, without power of revocation, Cesar Baez, with an office at 152 West 57th Street, 34th Floor, NY, NY 10019, Attn: Cesar Baez, as its agent to accept and acknowledge on its behalf service of any and all process which may be served in any action, proceeding or counterclaim in any way relating to or arising out of this Agreement.

 

9.4   Persons Having Rights under this Agreement. Nothing in this Agreement expressed and nothing that may be implied from any of the provisions hereof is intended, or shall be construed, to confer upon, or give to, any person or corporation other than the parties hereto and the Registered Holders of the Warrants any right, remedy, or claim under or by reason of this Agreement or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors and assigns and of the Registered Holders of the Warrants.

 

9.5   Examination of the Agreement. A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in the Borough of Manhattan, City and State of New York, for inspection by the Registered Holder of any Warrant. The Warrant Agent may require any such holder to submit his Warrant for inspection by it.

 

9.6   Counterparts. This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

 

9.7   Effect of Headings. The section headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation thereof.

 

  

15

  

 

9.8   Amendments. This Agreement may be amended by the parties hereto without the consent of any Registered Holder for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained herein or adding or changing any other provisions with respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem shall not adversely affect the interest of the Registered Holders. All other modifications or amendments, including any amendment to increase the Warrant Price or shorten the Exercise Period and any amendment to the terms of only the Placement Warrants, shall require the written consent of the Registered Holders of 65% of the then outstanding Public Warrants. Further, the Initial Investors shall not vote any Placement Warrants owned or controlled by them in favor of such amendment unless the Registered Holders of 65% of the Public Warrants vote in favor of such amendment. Notwithstanding the foregoing, the Company may lower the Warrant Price or extend the duration of the Exercise Period pursuant to Sections 3.1 and 3.2, respectively, without the consent of the Registered Holders.

 

9.9   Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.

 

Exhibit A Form of Warrant Certificate

Exhibit B Legend — Placement Warrants

 

  

16

  

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

	  	  	  	  	  
	  	
BGS ACQUISITION CORP.

 

 

	  
	  	
By:  

	
    

	  
	  	  	
 Name: Cesar Baez

	  
	  	  	
 Title:  Chief Executive Officer

	  
	  

	  	  	  	  	  
	  	
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Warrant Agent

 

	  
	  	
By:  

	
   

	  
	  	  	
Name:  

	
  

	  
	  	  	
Title:  

	
  

	  
	  

 

  

17

  

 

EXHIBIT A

 

[Form of Warrant Certificate]

 

[FACE]

 

Number

 

                    

 

Warrants

 

                    

 

THIS WARRANT SHALL BE VOID IF NOT EXERCISED PRIOR TO

 THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED FOR

 IN THE WARRANT AGREEMENT DESCRIBED BELOW

 

 

BGS ACQUISITION CORP.

 A British Virgin Islands business company

 

CUSIP

 

 ____________

 

Warrant Certificate

 

This Warrant Certificate certifies that                                        , or registered assigns, is the registered holder of                      warrants (the “Warrants”) to purchase ordinary shares, no par value (the “Ordinary Shares”), of BGS Acquisition Corp., a British Virgin Island business company (the “Company”). Each Warrant entitles the holder, upon exercise during the period set forth in the Warrant Agreement referred to on the reverse hereof, to receive from the Company that number of fully paid and nonassessable Ordinary Shares as set forth below, at the exercise price (the “Exercise Price”) as determined pursuant to the Warrant Agreement, payable in lawful money (or through “cashless exercise” if permitted by the Warrant Agreement) of the United States of America upon surrender of this Warrant Certificate and payment of the Exercise Price at the office or agency of the Warrant Agent referred to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.

 

Each Warrant is initially exercisable for one fully paid and non-assessable Ordinary Share. The number of Ordinary Shares issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.

 

The initial Exercise Price per Ordinary Share for any Warrant is equal to $10.00 per share. The Exercise Price is subject to adjustment upon the occurrence of certain events set forth in the Warrant Agreement.

 

Subject to the conditions set forth in the Warrant Agreement, the Warrants may be exercised only during the Exercise Period and to the extent not exercised by the end of such Exercise Period, such Warrants shall become void.

 

Reference is hereby made to the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes have the same effect as though fully set forth at this place.

 

  

18

  

 

This Warrant Certificate shall not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.

 

This Warrant Certificate shall be governed and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles thereof.

	  	  	  	  	  
	  	
BGS ACQUISITION CORP.

 

 

	  
	  	
By:  

	
/s/    

	  
	  	  	
 Name: Cesar Baez

	  
	  	  	
 Title: Chief Executive Officer

	  
	  

	  	  	  	  	  
	  	
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Warrant Agent

 

	  
	  	
By:  

	
/s/    

	  
	  	  	
Name:  

	
  

	  
	  	  	
Title:  

	
  

	  
	  

 

  

19

  

[Form of Warrant Certificate]

 

[Reverse]

 

The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive Ordinary Shares and are issued or to be issued pursuant to a Warrant Agreement dated as of [●], 2012 (the “Warrant Agreement”), duly executed and delivered by the Company to Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agent”), which Warrant Agreement is hereby incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders”  or  “holder”  meaning the Registered Holders or Registered Holder) of the Warrants. A copy of the Warrant Agreement may be obtained by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.

 

Warrants may be exercised at any time during the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate may exercise them by surrendering this Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Exercise Price as specified in the Warrant Agreement (or through “cashless exercise” if permitted by the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon any exercise of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number of Warrants not exercised. No adjustment shall be made for any dividends on any of the Ordinary Shares issuable upon exercise of this Warrant.

 

Notwithstanding anything else in this Warrant Certificate or the Warrant Agreement, no Warrant may be exercised unless at the time of exercise (i) a post-effective amendment to the Registration Statement or a new registration statement covering the Ordinary Shares to be issued upon exercise is effective under the Securities Act and (ii) a prospectus thereunder relating to the Ordinary Shares is current, except through “cashless exercise” if permitted by the Warrant Agreement.

 

The Warrant Agreement provides that upon the occurrence of certain events the number of the Warrants set forth on the face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be entitled to receive a fractional interest in an Ordinary Share, the Company shall, upon exercise, round up to the nearest whole number of Ordinary Shares to be issued to the holder of the Warrant.

 

Warrant Certificates, when surrendered at the principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrants.

 

Upon due presentation for registration of transfer of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith.

 

The Company and the Warrant Agent may deem and treat the Registered Holder(s) thereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary. Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a shareholder of the Company.

 

  

20

Election to Purchase

 

(To Be Executed Upon Exercise of Warrant)

 

The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to receive                      Ordinary Shares and herewith tenders payment for such shares to the order of BGS Acquisition Corp. (the “Company”) in the amount of $                       in accordance with the terms hereof. The undersigned requests that a certificate for such shares be registered in the name of                     , whose address is                      and that such shares be delivered to                      whose address is                     . If said number of shares is less than all of the Ordinary Shares purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares be registered in the name of                     , whose address is                     , and that such Warrant Certificate be delivered to                     , whose address is                     .

 

In the event that the Warrant is to be exercised on a “cashless” basis pursuant to Section 7.4 of the Warrant Agreement, the number of shares that this Warrant is exercisable for shall be determined in accordance with Section 7.4 of the Warrant Agreement.

 

In the event that the Warrant may be exercised, to the extent allowed by the Warrant Agreement, through cashless exercise (i) the number of shares that this Warrant is exercisable for would be determined in accordance with the relevant section of the Warrant Agreement which allows for such cashless exercise and (ii) the holder hereof shall complete the following:

 

The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant Agreement, to receive Ordinary Shares. If said number of shares is less than all of the Ordinary Shares purchasable hereunder (after giving effect to the cashless exercise), the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares be registered in the name of ___________, whose address is ____________, and that such Warrant Certificate be delivered to ___________, whose address is ____________.

 

Date:                    , 20

	  	  	  	  	  
	  	  	
  (Signature)

	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	  	  	  
	  	  	
  (Address)

	  	  
	  	  	  	  	  
	  	  	
  (Tax Identification Number)

	  	  

 

Signature Guaranteed:                                        

THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15).

  

21

  

 

EXHIBIT B

 

LEGEND

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER THE SECURITIES ACT, (B) TO A NON-U.S. PERSON IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (C) PURSUANT TO THE RESALE LIMITATIONS SET FORTH IN RULE 905 OF REGULATIONS S UNDER THE SECURITIES ACT, (D) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER JURISDICTION. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

IN ADDITION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED UNTIL THIRTY DAYS AFTER BGS ACQUISITION CORP. (THE “COMPANY”) COMPLETES ITS BUSINESS COMBINATION (AS DEFINED IN THE WARRANT AGREEMENT REFERRED TO HEREIN) EXCEPT TO A PERMITTED TRANSFEREE (AS DEFINED IN THE WARRANT AGREEMENT REFERRED TO HEREIN) WHO AGREES IN WRITING WITH THE COMPANY TO BE SUBJECT TO SUCH TRANSFER PROVISIONS.

 

[TO BE INSERTED IN UNDERWRITER WARRANTS:] [FOR A PERIOD OF 180 DAYS IMMEDIATELY FOLLOWING THE DATE OF EFFECTIVENESS OF THE REGISTRATION STATEMENT, THE HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE SHALL NOT DIRECTLY OR INDIRECTLY, OFFER, SELL, AGREE TO OFFER OR SELL, TRANSFER, ASSIGN, PLEDGE, HYPOTHECATE OR SUBJECT TO HEDGING, SHORT SALE, DERIVATIVE, PUT OR CALL TRANSACTION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE TO ANYONE OTHER THAN (I) AN UNDERWRITER OR A SELECTED DEALER PARTICIPATING IN THE INITIAL PUBLIC OFFERING OF THE COMPANY OR (II) ANY BONA FIDE SUCCESSOR, OFFICER OR PARTNER OF THE PRINCERIDGE GROUP LLC OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.]

 

SECURITIES EVIDENCED BY THIS CERTIFICATE AND THE ORDINARY SHARES OF THE COMPANY ISSUED UPON EXERCISE OF SUCH SECURITIES SHALL BE ENTITLED TO REGISTRATION RIGHTS UNDER A REGISTRATION RIGHTS AGREEMENT EXECUTED BY THE COMPANY.

 

	  	  	  
	  	  	  
	
No.                   

	  	
                    Warrants

 

 

 

22

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00200-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00200-of-00352.parquet"}]]