Pinpoint Advance (stock symbol: [t]PPAC[/t]) has announced that it has been unable to complete a business combination and that it intends to liquidate:
Pinpoint Advance Corp. Executes Letter of Intent, Dispute as to Execution of a Definitive Agreement; To Liquidate Trust Account and Return Funds to Public Stockholders
Monday October 27, 4:20 pm ET
HERZELIYA, Israel, Oct. 27 /PRNewswire-FirstCall/ -- Pinpoint Advance Corp. (OTC Bulletin Board: PPAC - News, PPACU - News, PPACW - News), a special purpose acquisition corporation ("Pinpoint" or the "Company"), announced it has executed a letter of intent to effectuate a business combination with a privately-held company with its headquarters in Israel (the "LOI"). All parties to the LOI negotiated the terms of a definitive agreement for more than four months and, in fact, a definitive agreement (the "Agreement") was executed by all parties to the LOI. However, one of the parties to the Agreement claimed it never released its signature thereto and has since indicated that it no longer wishes to pursue the proposed business combination.
Pinpoint believes a binding, definitive agreement was executed by all parties and is currently reviewing all available legal options. However, because one of the parties has indicated its position that no binding agreement currently exists and that it was no longer interested in the transaction envisioned in the Agreement, Pinpoint must, pursuant to the terms of its governing documents, liquidate the trust account established by Pinpoint for the benefit of its public stockholders (the "Trust Account"), and return funds to the holders of shares of Pinpoint common stock issued in its initial public offering (the "IPO Shares"), in accordance with its IPO prospectus and the terms of its amended and restated certificate of incorporation. After establishing a reserve for accrued Delaware franchise taxes and for other expenses, as of October 27, 2008, approximately $28,500,000 (approximately $9.91 per IPO Share) was in the Trust Account available for distribution (the "Redemption Payment").
Pinpoint intends to call a special meeting of its stockholders as soon as reasonably practicable for the purpose of seeking stockholder approval to: (i) redeem the IPO Shares for cash from the Trust Account in an amount per share equal to the Redemption Payment and (ii) continue Pinpoint's corporate existence in a modified form following distribution of the Trust Account, rather than dissolve the Company, as currently required by its Amended and Restated Certificate of Incorporation, while the Company (a) evaluates its options with respect to seeking damages against some of the other parties to the Agreement and LOI and/or (b) seeks other uses for the Company. To accomplish these goals, Pinpoint's board of directors believes it is necessary to modify its Amended and Restated Certificate of Incorporation to, among other things, eliminate the blank check company provisions which require, among other things, the dissolution of Pinpoint following distribution of the Trust Account in the event a business combination cannot be timely consummated.
About Pinpoint Advance Corp.
Pinpoint Advance Corp. is a blank check company formed in Delaware on September 6, 2006 to acquire a business with operations in Israel through acquisition, merger, capital stock exchange, asset acquisition, stock purchase or other similar business combination. Pinpoint's initial public offering was consummated on April 25, 2007, receiving gross proceeds of $28,750,000 through the sale of 2,875,000 units at $10.00 per unit. Each unit is comprised of one share of Pinpoint common stock and one warrant with an exercise price of $7.50.
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