The shareholders of Alternative Asset Management Acquisition (stock symbol: [t]AMV[/t]) were scheduled to vote on the acquisition of Great American Group, LLC this morning. The meeting was suspended and rescheduled for Thursday. The company has mow restructured its deal with Great American Group, reduced the number of shares held by the insiders and arranged to take out some dissenting shareholders.
Alternative Asset Management Acquisition Corp. and Great American Group, LLC Announce Revised Acquisition Terms and Alternative Asset Management Acquisition Corp.'s Entry into Common Stock Purchase Agreements
Press Release
Source: Alternative Asset Management Acquisition Corp.
On Tuesday July 28, 2009, 2:44 pm EDT
NEW YORK and WOODLAND HILLS, Calif., July 28 /PRNewswire-FirstCall/ -- Alternative Asset Management Acquisition Corp. ("AAMAC") (NYSE Amex: AMV) and privately-held Great American Group, LLC ("Great American") today jointly announced that they have entered into an amendment to the Agreement and Plan of Reorganization (the "Purchase Agreement") originally entered into May 14, 2009 and thereafter amended on May 29, 2009 and July 8, 2009, pursuant to which Great American will be acquired (the "Acquisition") by Great American Group, Inc., a newly-formed Delaware corporation and wholly-owned subsidiary of AAMAC ("GA").
In accordance with Amendment No. 3, upon consummation of the Acquisition, each share of AAMAC common stock will be exchanged for 2.0 shares of GA rather than a ratio of 1:1.23.
The amended Purchase Agreement eliminates the $10.0 million contingent cash consideration payable to the members of Great American and further provides that the cash consideration payable to the members of Great American will be payable pursuant to a subordinated, unsecured promissory note (the "Note") issued by GA in favor of the members and phantom equityholders of Great American. The aggregate principal amount of the Note will be $60.0 million, which principal amount shall be reduced by the amount of any payments made from AAMAC's trust account to the members and phantom equityholders of Great American at closing, which payments shall in no event reduce GA's cash position upon consummation of the Acquisition to below $40.0 million (after reservation of the amount necessary for the Warrant Redemption (as defined below)). The Note will have a five-year maturity and will bear interest at a rate of 12% per annum. Interest on the Note will be payable quarterly in arrears on each January 31st, April 30th, July 31st, and October 31st of each year, commencing on October 31, 2009. One-fifth of the principal amount of the Note, including any accrued and unpaid interest thereon, will be payable on each anniversary of the date of issuance of the Note through the fifth anniversary thereof.
The AAMAC directors, officers and sponsors (collectively, the "AAMAC founders") have agreed that 7,850,000 (increased from 6,350,000) of their shares will be cancelled, resulting in the AAMAC founders holding 2,500,000 (reduced from 4,000,000) shares of AAMAC common stock immediately prior to the consummation of the Acquisition. The AAMAC founders have further agreed to cancel 2,500,000 shares of GA common stock they receive upon exchange of their shares of AAMAC common stock for GA common stock.
The consummation of the Acquisition is contingent upon AAMAC obtaining the vote of a majority in interest of its warrantholders to allow AAMAC to amend the agreement governing its warrants to: (a) require GA to redeem all of the outstanding warrants, including the warrants held by AAMAC's sponsors, at any time on or prior to the 90(th) day following the Acquisition, at a price of $0.50 per warrant (the "Warrant Redemption"), (b) delay the commencement of the exercisability of the warrants from immediately following the Acquisition to the 91(st) day following the consummation of the Acquisition, and (c) preclude any adjustment of the warrants as a result of the Acquisition. If the AAMAC warrantholders approve the Warrant Redemption proposal, then GA will redeem the warrants on or prior to the 90(th) day following the Acquisition, during which period GA intends to explore the timing and conduct of a warrant exchange with the holders of GA warrants for warrants with an exercise price that exceeds the current exercise price and an exercise period longer than the existing exercise period.
The Acquisition is also subject to customary closing conditions, including approval of the Acquisition by AAMAC's stockholders. In addition, the closing of the Acquisition is conditioned on holders of fewer than 30% of the shares of AAMAC common stock voting against the Acquisition and electing to convert their AAMAC common stock into cash. Pursuant to Amendment No. 3, the consummation of the Acquisition is also conditioned upon the approval by the representative of the members of Great American Members and the phantom equityholders of Great American, in his sole discretion, of the aggregate cash balance of GA at closing.
The Special Meeting of AAMAC Warrantholders and Special Meeting of AAMAC Stockholders were scheduled to be held today and a record date of July 8, 2009 was set with respect to the meetings. Due to the revised terms set forth in Amendment No. 3, the Special Meetings were adjourned to Thursday, July 30, 2009, to give AAMAC warrantholders and AAMAC stockholders additional time to consider these revised terms of the Acquisition. AAMAC has until August 1, 2009 to complete a transaction or it will be required to liquidate.
AAMAC also announced today that it has entered into agreements to purchase an aggregate of approximately 13.02 million of the shares of its common stock sold in its initial public offering in privately negotiated transactions (the "Agreements") for an aggregate purchase price of approximately $128.3 million from stockholders who otherwise intended to vote against the previously announced proposed business combination between AAMAC and Great American. It is expected that additional Agreements will be entered into prior to the Special Meeting of Stockholders on similar terms. The purchases of the shares pursuant to the Agreements for an aggregate purchase price of approximately $200 million will take place concurrently with or immediately following the closing of the Acquisition and the purchases will be paid for with funds that will be released from AAMAC's trust account upon consummation of the Acquisition.
Pursuant to the Agreements, the holders have agreed to give AAMAC's management proxies to vote their shares in favor of each of the stockholder proposals set forth in the definitive proxy statement/prospectus, dated as of July 20, 2009 (the "Definitive Proxy Statement/Prospectus"). These proxies will revoke any prior proxies associated with the shares subject to the Agreements that voted against such proposals.
Additional information regarding Great American, the Acquisition and the related transactions is available in the Definitive Proxy Statement/Prospectus and AAMAC's Current Report on Form 8-K filed with the Securities and Exchange Commission ("SEC") on July 28, 2009 (the "Current Report"), copies of which may be obtained without charge, at the SEC's website at sec.gov. Great American's website is greatamerican.com. The information on Great American's website is not, and shall not be deemed to be, incorporated in filings either AAMAC or GA makes with the SEC.
<snip>
finance.yahoo.com |
