Document:

ex10-4_1435232.htm

EXHIBIT 10.4

 

WARRANT SUBSCRIPTION AGREEMENT

 

WARRANT SUBSCRIPTION AGREEMENT (this “Agreement”) is made as of this ____ day of _________, 2010 by and between Australia Acquisition Corp., a company formed under the laws of the Cayman Islands (the “Company”), having its principal place of business at Level 11, 459 Collins Street, Melbourne VIC 3000 Australia, and certain of the Company’s officers and directors (the “Subscribers”) whose names appear on the signature page hereto.

 

WHEREAS, the Company desires to sell on a private placement basis (the “Offering”) an aggregate of 9,200,000 warrants (the “Warrants”) of the Company for a purchase price of $0.50 per Warrant.  Each Warrant is exercisable to purchase one Ordinary Share at an exercise price of $11.50 per share during the period commencing on the later of: (i) one year from the date of the prospectus (the “Prospectus”) contained in the registration statement (the “Registration Statement”) relating to the Company’s initial public offering of 8,000,000 units of Ordinary Shares and Warrants (the “IPO”) and (ii) the consummation of a Business Transaction (as defined in Section 5 below) and expiring on the fifth anniversary of the consummation of an initial Business Transaction;

 

WHEREAS, the Subscribers wish to purchase the Warrants and the Company wishes to accept such subscriptions.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Subscribers hereby agree as follows

 

1.           Agreement to Subscribe

 

1.1           Purchase and Issuance of the Warrants. Upon the terms and subject to the conditions of this Agreement, the Subscribers hereby agree to purchase from the Company, and the Company hereby agrees to sell to the Subscribers, on the Closing Date, the Warrants for an aggregate purchase price of $4,600,000 (the “Purchase Price”) in such amount as indicated on the signature pages hereto.

 

1.2           Delivery of the Purchase Price. Upon execution of this Agreement, the Subscribers are hereby bound to fulfill their obligations hereunder and hereby irrevocably commit to deliver into a trust account at a financial institution to be chosen by the Company, maintained by Continental Stock Transfer & Trust Company, acting as Trustee immediately prior to the date of Closing (as hereinafter defined), the Purchase Price in immediately available funds by certified bank check, wire transfer or such other form of payment as shall be acceptable to the Trustee, in its sole and absolute discretion, at the Closing.

 

1.3           Closing. The closing of the Offering (the “Closing”) shall take place at the offices of the Company, on or prior to the date of the Prospectus (the “Closing Date”).

 

2.           Representations and Warranties of the Subscribers

 

Each Subscriber represents and warrants to the Company solely as to such Subscriber that:

 

  

  

  

2.1           No Government Recommendation or Approval. Subscriber understands that no United States federal or state agency has passed upon or made any recommendation or endorsement of the Company or the Offering of the Warrants or Ordinary Shares underlying the Warrants (the “Warrant Shares” and, collectively with the Warrants, the “Securities”).

 

2.2           Accredited Investor. Subscriber represents that it is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”) and acknowledges the sale contemplated hereby is being made in reliance, among others, on a private placement exemption to “Accredited Investors” contained in Regulation D under the Securities Act or similar exemptions under state law.

 

2.3           Intent. Subscriber is purchasing the Warrants solely for investment purposes, for its own account and not for the account or benefit of any U.S. Person to the extent the Subscriber is not a U.S. Person, and not with a view towards the distribution thereof and Subscriber has no present arrangement to sell the Securities to or through any person or entity. Subscriber shall not engage in hedging transactions with regard to the Warrants and the underlying securities unless in compliance with the Securities Act.

 

2.4           Restrictions on Transfer. Subscriber acknowledges and understands the Warrants are being offered in a transaction not involving a public offering in the United States within the meaning of the Securities Act. The Securities have not been registered under the Securities Act, and, if in the future Subscriber decides to offer, resell, pledge or otherwise transfer the Securities, such Securities may be offered, resold, pledged or otherwise transferred only (A) pursuant to an effective registration statement filed under the Securities Act, (B) pursuant to an exemption from registration under Rule 144 promulgated under the Securities Act, if available, or (C) pursuant to any other available exemption from the registration requirements of the Securities Act, and in each case in accordance with any applicable securities laws of any state or any other jurisdiction. Subscriber agrees that if any transfer of its Securities or any interest therein is proposed to be made, as a condition precedent to any such transfer, Subscriber may be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or another available exemption from registration, Subscriber agrees it will not resell the Securities. Subscriber further acknowledges that because the Company is a shell company, Rule 144 may not be available to Subscriber for the resale of the Securities until the one year anniversary following consummation of the initial Business Transaction of the Company, despite technical compliance with the requirements of Rule 144 and the release or waiver of any contractual transfer restrictions.

 

2.5           Sophisticated Investor.

 

(i)           Subscriber is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Securities.

 

(ii)           Subscriber is aware that an investment in the Warrants is highly speculative and subject to substantial risks because, among other things, none of the Securities have been registered under the Securities Act and therefore cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available.

 

  

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Subscriber is able to bear the economic risk of its investment in the Securities for an indefinite period of time.

 

2.6           Independent Investigation. Subscriber, in making the decision to purchase the Warrants, has relied upon an independent investigation of the Company and has not relied upon any information or representations made by any third parties or upon any oral or written representations or assurances from the Company, its officers, directors or employees or any other representatives or agents of the Company, other than as set forth in this Agreement. Subscriber is familiar with the business, operations and financial condition of the Company and has had an opportunity to ask questions of, and receive answers from the Company’s officers and directors concerning the Company and the terms and conditions of the offering of the Warrants and has had full access to such other information concerning the Company as Subscriber has requested. Subscriber confirms that all documents that it has requested have been made available and that Subscriber has been supplied with all of the additional information concerning this investment which it has requested.

 

2.7           Organization and Authority. If the Subscriber is a corporation, limited liability company, partnership, trust or other entity, the Subscriber is validly existing under the laws of its jurisdiction of incorporation and is authorized and otherwise duly qualified to purchase and hold the Securities and this Agreement has been duly and validly authorized, executed and delivered and constitutes the legal, binding and enforceable obligation of the Subscriber.  If the Subscriber is an individual, this Agreement has been duly and validly executed and delivered and constitutes the legal, binding and enforceable obligation of the Subscriber, subject to the general principles of equity and to bankruptcy or other laws affecting the enforcement of creditors’ rights generally.

 

2.8           Foreign Subscribers.  If the Subscriber is not a U.S. Person, the Subscriber hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction in connection with any invitation to subscribe for the Warrants or any use of this Agreement, including: (i) the legal requirements within its jurisdiction for the purchase of the Warrants; (ii) any foreign exchange restrictions applicable to such purchase; (iii) any governmental or other consents that may need to be obtained and (iv) the income tax and other tax consequences, if any, that may be relevant to the purchase, holding, redemption, sale or transfer of the Warrants.  The Subscriber’s subscription and payment for, and continued beneficial ownership of the Warrants, will not violate any applicable securities or other laws of the Subscriber’s jurisdiction.

 

2.9           No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions contemplated hereby do not violate, conflict with or constitute a default under (i) the Subscriber’s organizational documents (ii) any agreement, indenture or instrument to which the Subscriber is a party, (iii) any law, statute, rule or regulation to which Subscriber is subject or (iv) any agreement, order, judgment or decree to which Subscriber is subject.

 

2.10           No Legal Advice from Company. Subscriber acknowledges it has had the opportunity to review this Agreement and the transactions contemplated by this Agreement and the other agreements entered into between the parties hereto with Subscriber’s own legal counsel and investment and tax advisors. Except for any statements or representations of the Company

 

  

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made in this Agreement and the other agreements entered into between the parties hereto, Subscriber is relying solely on such counsel and advisors and not on any statements or representations of the Company or any of its representatives or agents for legal, tax or investment advice with respect to this investment, the transactions contemplated by this Agreement or the securities laws of any jurisdiction.

 

2.11           Reliance on Representations and Warranties. Subscriber understands the Warrants are being offered and sold to it in reliance on exemptions from the registration requirements under the Securities Act, and analogous provisions in the laws and regulations of various states, and that the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of Subscriber set forth in this Agreement in order to determine the applicability of such provisions.

 

2.12           No General Solicitation. Subscriber is not subscribing for the Warrants as a result of or subsequent to any general solicitation or general advertising, including, but not limited to, any advertisement, article, notice or other communication published in any newspaper, magazine, or similar media or broadcast over television or radio, or presented at any seminar or meeting.

 

2.13           Legend. Subscriber acknowledges and agrees the certificates evidencing the Warrants and the Warrant Shares shall bear a restrictive legend (the “Legend”), in form and substance as set forth in Section 4 hereof, prohibiting the offer, sale, pledge or transfer of the securities, except (i) pursuant to an effective registration statement covering these securities under the Securities Act or (ii) pursuant to any other exemptions from the registration requirements under the Securities Act and such laws which, in the opinion of counsel for this Company, is available.

 

2.14           FINRA Members. The undersigned acknowledges that if it is a Registered Representative of a FINRA member firm, the undersigned must give such firm notice required by the FINRA’s Rules of Fair Practice, receipt of which must be acknowledged by such firm on the signature page hereof.

 

2.15           Control Over Funds.  The Subscriber represents that the funds provided for this investment are either separate property of the Subscriber, community property over which the Subscriber has the right of control, or are otherwise funds as to which the Subscriber has the sole right of management.

 

2.16           Irrevocable.  The Subscriber agrees that this Agreement is and shall be irrevocable.

 

3.           Representations and Warranties of the Company

 

The Company represents and warrants to the Subscribers that:

 

3.1           Valid Issuance of Capital Stock. The total number of shares of all classes of capital stock which the Company has authority to issue is 49,000,000 Ordinary Shares and 1,000,000 shares of Preferred Stock. As of the date hereof, the Company has 3,066,667 Ordinary Shares (of which up to 400,000 shares are subject to redemption for nominal value as described

 

  

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in the Registration Statement) and no shares of Preferred Stock issued and outstanding. All of the issued shares of capital stock of the Company have been duly authorized, validly issued, and are fully paid and non-assessable.

 

3.2           Title to Warrants. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Warrant Agreement, as the case may be, each of the Warrants and the Warrant Shares will be duly and validly issued, fully paid and non-assessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof and the Warrant Agreement, as the case may be, Subscriber will have or receive good title to the Warrants, free and clear of all liens, claims and encumbrances of any kind, other than (i) transfer restrictions hereunder and under the other agreements contemplated hereby and (ii) transfer restrictions under federal and state securities laws.

 

3.3           Organization and Qualification. The Company is a company duly formed and existing under the laws of the Cayman Islands and has the requisite corporate power to own its properties and assets and to carry on its business as now being conducted.

 

3.4           Authorization; Enforcement. (i) The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement and to issue the Warrants and the Warrant Shares in accordance with the terms hereof, (ii) the execution, delivery and performance of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary corporate action, and no further consent or authorization of the Company or its Board of Directors or shareholders is required, and (iii) this Agreement constitutes valid and binding obligations of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance, moratorium, reorganization, or similar laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by equitable principles of general application and except as enforcement of rights to indemnity and contribution may be limited by federal and state securities laws or principles of public policy.

 

3.5           No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby do not (i) result in a violation of the Company’s Memorandum and Articles of Association, as amended, (ii) conflict with, or constitute a default under any agreement, indenture or instrument to which the Company is a party or (iii) any law statute, rule or regulation to which the Company is subject or any agreement, order, judgment or decree to which the Company is subject. Other than any Securities Exchange Commission (the “SEC”) or state securities filings which may be required to be made by the Company subsequent to the Closing, and any registration statement which may be filed pursuant thereto, the Company is not required under federal, state or local law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or self-regulatory entity in order for it to perform any of its obligations under this Agreement or issue the Warrants or the Warrant Shares in accordance with the terms hereof.

 

  

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4.           Legends

 

4.1           Legend. The Company will issue the Warrants, and when issued, the Warrant Shares, purchased by each Subscriber in its respective name. The Securities will bear the following Legend and appropriate “stop transfer” instructions:

 

“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL FOR THIS CORPORATION, IS AVAILABLE.”

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS CONTAINED IN A SECURITIES ESCROW AGREEMENT (THE “AGREEMENT”) AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE TERM OF THE ESCROW PERIOD (AS DEFINED IN THE AGREEMENT).”

 

4.2           Subscribers’ Compliance. Nothing in this Section 4 shall affect in any way each Subscriber’s obligations and agreements to comply with all applicable securities laws upon resale of the Securities.

 

4.3           Company’s Refusal to Register Transfer of the Securities. The Company shall refuse to register any transfer of the Securities, if in the sole judgment of the Company such purported transfer would not be made (i) pursuant to an effective registration statement filed under the Securities Act, or (ii) pursuant to an available exemption from the registration requirements of the Securities Act.

 

4.4           Registration Rights.  Subscribers will be entitled to certain registration rights which will be governed by a registration rights agreement (the “Registration Rights Agreement”) to be entered into with the Company on or prior to the closing of the IPO.

 

5.           Escrow. Upon consummation of the IPO, the holders of the Warrants shall enter into a securities escrow agreement (the “Escrow Agreement”) with Continental Stock Transfer & Trust Company, whereby the Warrants shall be held in escrow until 90 days following consummation of a Business Transaction (as defined therein) subject to certain restrictions as set forth in the Escrow Agreement.

 

6.           Securities Laws Restrictions.  In addition to the restrictions contained in the Escrow Agreement, each Subscriber agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Securities unless, prior thereto (a) a registration statement on the appropriate form under the Securities Act and applicable state securities laws with respect to the Securities proposed to be transferred shall then be effective or (b) the Company shall have received an opinion from counsel reasonably satisfactory to the Company, that such registration

 

  

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is not required because such transaction complies with the Securities Act and the rules promulgated by the SEC thereunder and with all applicable state securities laws.

 

7.           Waiver of Liquidation Distributions. In connection with the Securities purchased pursuant to this Agreement, and with respect to any Ordinary Shares purchased by the Subscribers prior to the IPO, the Subscribers hereby waive any and all right, title, interest or claim of any kind in or to any distributions of the trust account, whether in connection with (i) the exercise of redemption rights if the Company consummates a Business Transaction whether pursuant to a shareholder vote or the tender offer rules or (ii) upon the Company’s redemption of Ordinary Shares sold in the IPO upon the Company’s failure to timely complete a Business Transaction. For purposes of clarity, in the event the Subscribers purchase Ordinary Shares in the IPO or in the aftermarket, any additional Ordinary Shares so purchased shall be eligible to receive the redemption value of such Ordinary Shares upon the same terms offered to all other purchasers of Ordinary Shares in the IPO upon the Company’s failure to timely complete a Business Transaction. In no event will the Subscribers have the right to exercise any Warrants prior to the later of: (i) one year from the date of the Prospectus and (ii) the consummation of a Business Transaction.

 

8.           Termination of Warrants.

 

8.1           Failure to Consummate Business Transaction. The Warrants shall be terminated upon the dissolution of the Company in the event that the Company does not consummate a Business Transaction within 21 months from the consummation of the IPO.

 

8.2           Termination of Rights as holder; Escrow. If the Warrants are terminated in accordance with this Section 8, then after such time the Subscribers (or successor in interest), shall no longer have any rights as a holder of such Warrants.

 

9.           Rescission Right Waiver and Indemnification.

 

9.1           Each Subscriber understands and acknowledges an exemption from the registration requirements of the Securities Act requires there be no general solicitation of purchasers of the Warrants. In this regard, if the IPO were deemed to be a general solicitation with respect to the Warrants, the offer and sale of such Warrants may not be exempt from registration and, if not, each Subscriber may have a right to rescind its purchase of the Warrants. In order to facilitate the completion of the Offering and in order to protect the Company, its shareholders and the trust account from claims that may adversely affect the Company or the interests of its shareholders, each Subscriber hereby agrees to waive, to the maximum extent permitted by applicable law, any claims, right to sue or rights in law or arbitration, as the case may be, to seek rescission of its purchase of the Warrants. Each Subscriber acknowledges and agrees this waiver is being made in order to induce the Company to sell the Warrants to such Subscriber. Each Subscriber agrees the foregoing waiver of rescission rights shall apply to any and all known or unknown actions, causes of action, suits, claims or proceedings (collectively, “Claims”) and related losses, costs, penalties, fees, liabilities and damages, whether compensatory, consequential or exemplary, and expenses in connection therewith, including reasonable attorneys’ and expert witness fees and disbursements and all other expenses reasonably incurred in investigating, preparing or defending against any Claims, whether

 

  

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pending or threatened, in connection with any present or future actual or asserted right to rescind the purchase of the Warrants hereunder or relating to the purchase of the Warrants and the transactions contemplated hereby.

 

9.2           Each Subscriber agrees not to seek recourse against the trust account for any reason whatsoever in connection with its purchase of the Warrants or any Claim that may arise now or in the future.

 

9.3           Each Subscriber acknowledges and agrees the shareholders of the Company and Cohen & Company Securities LLC, the representative of the underwriters in the IPO, are and shall be third-party beneficiaries of the foregoing provisions of this Agreement.

 

9.4           Each Subscriber agrees that to the extent any waiver of rights under this Section 9 is ineffective as a matter of law, each Subscriber has offered such waiver for the benefit of the Company as an equitable right that shall survive any statutory disqualification or bar that applies to a legal right. Each Subscriber acknowledges the receipt and sufficiency of consideration received from the Company hereunder in this regard.

 

10.           Terms of the Warrant

 

The Warrants are substantially identical to the warrants included in the units offered in the IPO as set forth in the Warrant Agreement to be entered into with Continental Stock Transfer and Trust Company on or prior to the Closing, except: (i) they will be placed in escrow and not released before, except in limited circumstances, until the consummation of a Business Transaction, (iii) they are being purchased pursuant to an exemption from the registration requirements of the Securities Act and will become freely tradable only after they are registered pursuant to the Registration Rights Agreement to be signed on or before the date of the Prospectus, (iv) they will be non-redeemable so long as they are held by a Subscriber (or any of his permitted transferees), and (v) they are exercisable on a “cashless” basis if held by a Subscriber (or any of his or its permitted transferees).

 

11.           Governing Law; Jurisdiction; Waiver of Jury Trial

 

This Agreement shall be governed by and construed in accordance with the laws of the State of New York for agreements made and to be wholly performed within such state. The parties hereto hereby waive any right to a jury trial in connection with any litigation pursuant to this Agreement and the transactions contemplated hereby.

 

12.           Assignment; Entire Agreement; Amendment

 

12.1           Assignment. Neither this Agreement nor any rights hereunder may be assigned by any party to any other person other than by a Subscriber to a person agreeing to be bound by the terms hereof.

 

12.2           Entire Agreement. This Agreement sets forth the entire agreement and understanding between the parties as to the subject matter thereof and merges and supersedes all prior discussions, agreements and understandings of any and every nature among them.

 

  

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12.3           Amendment. Except as expressly provided in this Agreement, neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

 

12.4           Binding upon Successors. This Agreement shall be binding upon and inure to the benefit of the parties hereto and to their respective heirs, legal representatives, successors and permitted assigns.

 

13.           Notices; Indemnity

 

13.1           Notices. Unless otherwise provided herein, any notice or other communication to a party hereunder shall be sufficiently given if in writing and personally delivered or sent by facsimile or other electronic transmission with copy sent in another manner herein provided or sent by courier (which for all purposes of this Agreement shall include Federal Express or other recognized overnight courier) or mailed to said party by certified mail, return receipt requested, at its address provided for herein or such other address as either may designate for itself in such notice to the other. Communications shall be deemed to have been received when delivered personally, on the scheduled arrival date when sent by next day or 2nd-day courier service, or if sent by facsimile upon receipt of confirmation of transmittal or, if sent by mail, then three days after deposit in the mail. If given by electronic transmission, such notice shall be deemed to be delivered (a) if by electronic mail, when directed to an electronic mail address at which the shareholder has consented to receive notice; (b) if by a posting on an electronic network together with separate notice to the shareholder of such specific posting, upon the later of (1) such posting and (2) the giving of such separate notice; and (c) if by any other form of electronic transmission, when directed to the stockholder.

 

13.2           Indemnification. The Subscribers and the Company agree to indemnify each other against any loss, cost or damages (including reasonable attorney’s fees and expenses) incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in this Agreement.

 

14.           Counterparts

 

This Agreement may be executed in one or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a “.pdf” format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.

 

15.           Survival; Severability

 

15.1           Survival. The representations, warranties, covenants and agreements of the parties hereto shall survive the Closing.

 

  

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15.2           Severability. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that no such severability shall be effective if it materially changes the economic benefit of this Agreement to any party.

 

16.           Headings.

 

The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

 

[The remainder of this page is intentionally left blank.]

 

  

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This subscription is accepted by the Parties on the ___ day of ____________ 2010.

 

 

	  	
AUSTRALIA ACQUISITION CORP.

 

	  	
By:

	  
	  	  	
Name: Peter Ziegler

Title: Chairman, Chief Executive Officer

	  	  	  
	  	  
	  	
SUBSCRIBERS

 

ZIEGLER ASSET PARTNERS TRUST

 

 

	  	
Name: Peter Ziegler

Title:   Authorized Signatory

No. of Warrants: 7,981,000

 

 

	  	
E. Stephen Streeter

No. of Warrants: 345,000

 

 

	  	
Brett Chenoweth

No. of Warrants: 345,000

 

 

	  	
Charbel Nader

No. of Warrants: 345,000

 

 

	  	
Ian Zimmer

No. of Warrants: 92,000

 

 

	  	
Peter O’Brien

No. of Warrants: 92,000

 

 

  

11ex10-5_1434900.htm

EXHIBIT 10.5

SECURITIES ESCROW AGREEMENT

 

SECURITIES ESCROW AGREEMENT, dated as of ________, 2010 (the “Agreement”) by and among Australia Acquisition Corp., a Cayman Islands corporation (the “Company”), the undersigned parties listed as the Investors on the signature pages hereto (each, an “Investor” and collectively, the “Investors”) and Continental Stock Transfer & Trust Company, a New York corporation (the “Escrow Agent”).

 

 

WHEREAS, the Company has entered into an Underwriting Agreement, dated _______, 2010 (“Underwriting Agreement”) with Cohen & Company Securities, LLC, (the “Representative”), acting as representative of the several underwriters (collectively, the “Underwriters”), pursuant to which, among other matters, the Underwriters have agreed to purchase 8,000,000 units (not including the underwriters’ over-allotment option) (“Units”) of the Company’ securities. Each Unit consists of one ordinary share of the Company, par value $.001 per share (the “Ordinary Shares”), and one warrant (“Warrant”), each Warrant to purchase one Ordinary Share, all as more fully described in the Company’s definitive Prospectus, dated ________, 2010 (“Prospectus”) comprising part of the Company’s Registration Statement on Form F-1 (File No. 333-XXXXXX) under the Securities Act of 1933, as amended (the “Registration Statement”), declared effective on _________, 2010 (the “Effective Date”);

 

 

WHEREAS, the Investors currently hold all of the outstanding Ordinary Shares of the Company issued prior to the consummation of the Company’s initial public offering (the “Initial Shares”);

 

 

WHEREAS, the Investors have entered into a Warrant Subscription Agreement with the Company dated _________, 2010 (the “Subscription Agreement”) pursuant to which the Investors are purchasing in the aggregate 9,200,000 warrants (the “Private Warrants”) in a private placement transaction occurring on or before the consummation of the Company’s initial public offering;

 

 

WHEREAS, the Investors have agreed, as a condition of the Underwriters’ obligation to purchase the Units pursuant to the Underwriting Agreement and to offer them to the public, to deposit all of the Initial Shares owned by them, as set forth opposite each name on Exhibit A attached hereto, in aggregate 3,066,667 shares (up to 400,000 of which are subject to redemption to the extent the over-allotment option is not exercised in full) (the “Escrow Shares”), in escrow as hereinafter provided;

 

 

WHEREAS, the Investors have agreed as a condition of the sale of the Private Warrants to deposit all of their respective Private Warrants (together with the Escrow Shares, the “Escrow Securities”), as set forth opposite their respective names on Exhibit A attached hereto, with the Escrow Agent as hereinafter provided; and

 

 

WHEREAS, the Company and the Investors desire that the Escrow Agent accept the Escrow Securities, to be held in escrow and disbursed as hereinafter provided.

 

  

 

  

 

IT IS AGREED:

 

 

1.           Appointment of Escrow Agent. The Company and the Investors hereby appoint the Escrow Agent to act in accordance with and subject to the terms of this Agreement and the Escrow Agent hereby accepts such appointment and agrees to act in accordance with and subject to such terms.

 

 

2.           Deposit of Escrow Securities. On or before the Effective Date, the Investors shall deliver to the Escrow Agent certificates representing their respective Escrow Securities, in proper transfer order with Medallion guaranteed stock powers, to be held and disbursed subject to the terms and conditions of this Agreement. The Investors acknowledge and agree that the certificates representing the Escrow Securities will bear a legend to reflect the deposit of such Escrow Securities under this Agreement.

 

 

3.           Disbursement of the Escrow Securities.  The Escrow Agent shall hold each of the Escrow Shares and the Private Warrants until the termination of their respective Escrow Period (as defined below). In the case of the Escrow Shares, the “Escrow Period” shall be the period beginning on the date the certificates representing the Shares are deposited with the Escrow Agent and ending on (i) with respect to 20% of such shares, upon consummation of the initial Business Transaction (as such term is defined in the Registration Statement), (ii) with respect to 20% of such shares, when the closing price of the Company’s Ordinary Shares exceeds $11.75 for any 20 trading days within a 30-trading day period following the consummation of the initial Business Transaction, (iii) with respect to 20% of such shares, when the closing price of the Company’s Ordinary Shares exceeds $12.75 for any 20 trading days within a 30-trading day period following the consummation of the initial Business Transaction, (iv) with respect to 20% of such shares, when the closing price of the Company’s Ordinary Shares exceeds $14.00 for any 20 trading days within a 30-trading day period following the consummation of the initial Business Transaction and (v) with respect to 20% of such shares, when the closing price of the Company’s Ordinary Shares exceeds $15.50 for any 20 trading days within a 30-trading day period following the consummation of the initial Business Transaction or earlier if, subsequent to the initial Business Transaction the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which (a) results in all of the Company shareholders having the right to exchange their Ordinary Shares for cash, securities or other property or (b) involves a merger or other change in the majority of the Company’s board of directors or management team in which the Company is the surviving entity.  In the case of the Private Warrants, the “Escrow Period” shall be the period beginning on the date the certificates representing the Private Warrants are deposited with the Escrow Agent and ending 90 days following the date of the consummation of the initial Business Transaction. On the termination date of the applicable Escrow Period, the Escrow Agent shall, upon written instructions from the Company, disburse the Escrow Securities to such holders; provided, however, that if the Escrow Agent is notified by the Company pursuant to Section 6.6 hereof that the Company is (i) being liquidated at any time during the Escrow Period, or (ii) that up to 400,000 of the Escrow Shares have been redeemed, then the Escrow Agent shall promptly destroy the certificates representing such Escrow Securities (or portion thereof, as applicable).  The Escrow Agent shall have no further duties hereunder after the disbursement or destruction of the Escrow Securities in accordance with this Section 3.

 

  

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4.           Rights of Initial Holder in Escrow Securities.

 

 

4.1.           Voting Rights as a Shareholder. Subject to the terms of the Insider Letter described in Section 4.4 hereof and except as herein provided, each Investor shall retain all of their respective rights as a shareholder of the Company during the Escrow Period, including, without limitation, the right to vote the Escrow Shares.

 

 

4.2.           Dividends and Other Distributions in Respect of the Escrow Securities. During the Escrow Period, all dividends payable in cash with respect to the Escrow Securities shall be paid to the Investors, but all dividends payable in stock or other non-cash property (“Non-Cash Dividends”) shall be delivered to the Escrow Agent to hold in accordance with the terms hereof. As used herein, the term “Escrow Securities” shall be deemed to include the Non-Cash Dividends distributed thereon, if any.

 

 

4.3.           Restrictions on Transfer.  During the Escrow Period, no sale, transfer or other disposition may be made of any or all of the Escrow Securities except (i) upon the dissolution and liquidation of an Investor (if an entity) and the distribution of assets to such Investor’s shareholders, members or similar holders; (ii) by gift to an immediate family member of any Investor or to a trust, the beneficiary of which is an immediate family member of such Investor, (iii) by virtue of the laws of descent and distribution upon death of any Investor, (iv) pursuant to a qualified domestic relations order, (v) by certain pledges to secure obligations incurred in connection with purchases of the Company’s securities, (vi) by private sales made at or prior to the consummation of the initial Business Transaction at prices no greater than the price at which the shares were originally purchased, (vii) in the event of the Company’s liquidation prior to completion of its initial Business Transaction or (viii) in the event of the Company’s consummation of a liquidation, merger, stock exchange or other similar transaction which (a) results in all of the Company’s shareholders having the right to exchange their Ordinary Shares for cash, securities or other property subsequent to the Company’s consummation of an initial Business Transaction or (b) involves a merger or other change in the majority of its board of directors or management team in which the Company is the surviving entity; provided, however, that such permissive transfers may be implemented only upon the respective transferee’s written agreement to be bound by the terms and conditions of this Agreement and of the Insider Letter signed by the Investor that is transferring the Escrow Shares. Even if transferred in accordance with this Section 4.3, the Escrow Securities will remain subject to this agreement and may be released from escrow only in accordance with Section 3 hereof.  During the Escrow Period, the Investors shall not pledge or grant a security interest in the Escrow Securities or grant a security interest in its rights under this Agreement.

 

 

4.4.           Insider Letters. Each Investor has executed a letter agreement with the Representative and the Company, dated as of the Effective Date, a form of which is filed as an exhibit to the Registration Statement (each an “Insider Letter”), respecting the rights and

 

 

obligations of such Investor in certain events, including, but not limited to, the liquidation of the Company.

 

 

5.           Concerning the Escrow Agent.

 

  

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          5.1.           Good Faith Reliance. The Escrow Agent shall not be liable for any action taken or omitted by it in good faith and in the exercise of its own best judgment, and may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Escrow Agent, which counsel may be company counsel), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but also as to the truth and acceptability of any information therein contained) which is believed by the Escrow Agent to be genuine and to be signed or presented by the proper person or persons. The Escrow Agent shall not be bound by any notice or demand, or any waiver, modification, termination or rescission of this Agreement unless evidenced by a writing delivered to the Escrow Agent signed by the proper party or parties and, if the duties or rights of the Escrow Agent are affected, unless it shall have given its prior written consent thereto.

 

5.2.           Indemnification. The Escrow Agent shall be indemnified and held harmless by the Company from and against any expenses, including reasonable counsel fees and disbursements, or loss suffered by the Escrow Agent in connection with any action taken by it hereunder, action, suit or other proceeding involving any claim which in any way, directly or indirectly, arises out of or relates to this Agreement, the services of the Escrow Agent hereunder, or the Escrow Securities held by it hereunder, other than expenses or losses arising from the gross negligence or willful misconduct of the Escrow Agent. Promptly after the receipt by the Escrow Agent of notice of any demand or claim or the commencement of any action, suit or proceeding, the Escrow Agent shall notify the other parties hereto in writing. In the event of the receipt of such notice, the Escrow Agent, in its sole discretion, may commence an action in the nature of interpleader in an appropriate court to determine ownership or disposition of the Escrow Securities or it may deposit the Escrow Securities with the clerk of any appropriate court or it may retain the Escrow Securities pending receipt of a final, non appealable order of a court having jurisdiction over all of the parties hereto directing to whom and under what circumstances the Escrow Securities are to be disbursed and delivered. The provisions of this Section 5.2 shall survive in the event the Escrow Agent resigns or is discharged pursuant to Sections 5.5 or 5.6 below.

 

 

5.3.           Compensation. The Escrow Agent shall be entitled to receive two hundred ($200.00) dollars per month for all services rendered by it hereunder, as set forth on Exhibit B hereto. The Escrow Agent shall also be entitled to reimbursement from the Company for all commercially reasonable expenses paid or incurred by it in the administration of its duties hereunder including, but not limited to, all counsel, advisors’ and agents’ fees and disbursements and all taxes or other governmental charges.

 

 

5.4.           Further Assurances. From time to time on and after the date hereof, the Company and the Investors shall deliver or cause to be delivered to the Escrow Agent such further documents and instruments and shall do or cause to be done such further acts as the Escrow Agent shall reasonably request to carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith or to assure itself that it is protected in acting hereunder.

 

  

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5.5.           Resignation. The Escrow Agent may resign at any time and be discharged from its duties as escrow agent hereunder by its giving the other parties hereto written notice and such resignation shall become effective as hereinafter provided. Such resignation shall become effective at such time that the Escrow Agent shall turn over to a successor escrow agent appointed by the Company and approved by the Representative, which approval will not be unreasonably withheld, conditioned or delayed, the Escrow Securities held hereunder. If no new escrow agent is so appointed within the 60 day period following the giving of such notice of resignation, the Escrow Agent may deposit the Escrow Securities with any court it reasonably deems appropriate.

 

 

5.6.           Discharge of Escrow Agent. The Escrow Agent shall resign and be discharged from its duties as escrow agent hereunder if so requested in writing at any time by the other parties hereto, jointly, provided, however, that such resignation shall become effective only upon acceptance of appointment by a successor escrow agent as provided in Section 5.5.

 

 

5.7.           Liability. Notwithstanding anything herein to the contrary, the Escrow Agent shall not be relieved from liability hereunder for its own gross negligence or its own willful misconduct.

 

 

6.           Miscellaneous.

 

 

6.1.           Governing Law. This Agreement shall for all purposes be deemed to be made under and shall be construed in accordance with the laws of the State of New York. Each of the parties 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 personal jurisdiction, which jurisdiction shall be exclusive. Each of the parties hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.

 

 

6.2.           Entire Agreement. This Agreement and the Insider Letters contain the entire agreement of the parties hereto with respect to the subject matter hereof and, except as expressly provided herein, may not be changed or modified except by an instrument in writing signed by the party to the charged.  In connection with any proposed amendment, the Escrow Agent may request an opinion of issuer’s counsel as to the validity of the proposed amendment as a condition to its execution of said amendment.

 

 

6.3.           Headings. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation thereof.

 

 

6.4.           Binding Effect. This Agreement shall be binding upon and inure to the benefit of the respective parties hereto and their legal representative, successors and assigns.

 

 

6.5.           Notices. Any notice or other communication required or which may be given hereunder shall be in writing and either be delivered personally or by private national courier service, or be mailed, certified or registered mail, return receipt requested, postage

 

 

  

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prepaid, and shall be deemed given when so delivered personally or, if sent by private national courier service, on the next business day after delivery to the courier, or, if mailed, two business days after the date of mailing, as follows:

 

if to the Escrow Agent, to:

Continental Stock Transfer & Trust Company

17 Battery Place

New York, NY 10004

Attn: Frank DiPalo

Fax No.: (212) 616-7620

 

if to the Company, to:

 

Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Attn:  Chief Executive Officer

Fax No.:  +61 (2) 9380 6944

 

and a copy, which shall not constitute notice, to:

 

Kelley Drye and Warren LLP

400 Atlantic Street

Stamford, CT 106901

Attn:  M. Ridge Barker, Esq.

Fax No.: (203) 327-2669

 

if to any Investor, to the address set forth in Exhibit A hereto.

 

if to the representative of the underwriters, to:

 

Cohen & Company Securities, LLC

600 Fifth Avenue, 19th Floor

New York, NY 10020

Attn:

Fax No.: (212) 543-9100

 

with a copy, to:

 

Ellenoff, Grossman & Schole LLP

150 East 42nd Street, 11th Floor

New York, New York 10017

Attn: Douglas Ellenoff, Esq.

Fax No.: (212) 370-7889

  

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The parties may change the persons and addresses to which the notices or other communications are to be sent by giving written notice to any such change in the manner provided herein for giving notice.

 

 

6.6.           Liquidation of Company; Redemption. The Company shall give the Escrow Agent prompt written notification of (i) the liquidation of the Company or (ii) redemption of up to 500,000 Escrow Shares held by the Investors to the extent the underwriters over-allotment option is not exercised in full, as further described in the Registration Statement.

 

 

6.7.           Trust Account Waiver. Notwithstanding anything herein to the contrary, the Escrow Agent hereby waives any and all right, title, interest or claim of any kind (“Claim”) in or to any distribution of the trust account (the “Trust Account”) in which the proceeds of the initial public offering conducted by the Company pursuant to the Prospectus (the “IPO”) and the proceeds of the sale of the Private Warrants will be deposited and held for the benefit of the holders of the securities purchased in the IPO, as described in greater detail in the Prospectus, and hereby agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason whatsoever.

 

 

6.8.           Third Party Beneficiaries. The Investors hereby acknowledge that the Underwriters, including, without limitation, the Representative, are third party beneficiaries of this Agreement and this Agreement cannot be modified or changed without the prior written consent of the Representative.

 

 

6.9.           Counterparts. This Agreement may be executed in several counterparts each one of which shall constitute an original and may be delivered by facsimile transmission and together shall constitute one instrument.

 

 

[remainder of page intentionally left blank]

 

  

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IN WITNESS WHEREOF, the parties have caused this Securities Escrow Agreement to be executed and delivered by their duly authorized representatives as of the date first above written.

 

	
AUSTRALIA ACQUISITION CORP.

 

	  	
CONTINENTAL STOCK TRANSFER & TRUST COMPANY

 

	
By:

	  	  	
By:

	  
	
Name: Peter Ziegler

Title: Chairman and Chief Executive OFficer

 

	  	
Name:  John W. Comer, Jr.

Title:  Vice President

 

	  	
INVESTORS:

	  	  
	  	
ZIEGLER ASSET PARTNERS TRUST

 

	
By:

	
 

	
Name:

	
Peter Ziegler

 

	
Title:

	
Authorized Signatory

 

	  	  
	  	
Charbel Nader

 

 

	  	
E. Stephen Streeter

 

 

	  	
Brett Chenoweth

 

 

	  	
Ian Zimmer

 

 

	  	
Peter O’Brien

 

  

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EXHIBIT A

Ziegler Asset Partners Trust

c/o Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Fax No.:  +61 (2) 9380 6944

	
Number of Shares: 2,660,333 (up to 347,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 7,981,000

 

Charbel Nader

c/o Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Fax No.:  +61 (2) 9380 6944

	
Number of Shares: 115,000 (up to 15,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 345,000

 

E. Stephen Streeter

c/o Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Fax No.:  +61 (2) 9380 6944

	
Number of Shares: 115,000 (up to 15,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 345,000

 

Brett Chenoweth

2001 Wilshire Blvd., Suite 400

Santa Monica, CA  90403

	
(310) 201-7990

	
Number of Shares: 115,000 (up to 15,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 345,000

 

Ian Zimmer

c/o Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Fax No.:  +61 (2) 9380 6944

	
Number of Shares: 30,667 (up to 4,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 92,000

 

  

9

  

Peter O’Brien

c/o Australia Acquisition Corp.

Level 11, 459 Collins Street

Melbourne VIC 3000 Australia

Fax No.:  +61 (2) 9380 6944

	
Number of Shares: 30,667 (up to 4,000) of which are subject to redemption in the event the underwriters over-allotment option is not exercised in full)

	
Number of Warrants: 92,000

 

  

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EXHIBIT B

 

Escrow Agent Fees

 

Two hundred ($200.00) dollars per month for all services rendered as Escrow Agent.

 

First twelve months’ agent fee ($2,400) to be paid in advance at the closing of the Company’s initial public offering.

 

  

11

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