-- Vanship has agreed to purchase up to 5,000,000 units of EIMC to the
extent necessary for EIMC to secure financing for the Acquisition at a
purchase price of $10.00 per unit. Each unit will consist of 1 share of
common stock and 1 common stock purchase warrant. The units will be
identical to those that were issued in Energy Infrastructure's July
2006 IPO except that they will be subject to a lock-up period of six
months post-closing;
-- Mr. George Sagredos, Energy Infrastructure's President and COO and a
Director, will convert convertible debt in the aggregate principal
amount of $2,685,000 into 268,500 units, at a conversion price of
$10.00 per unit. Each unit will consist of 1 share of common stock and
1 common stock purchase warrant. The units will be identical to those
that were issued in Energy Infrastructure's July 2006 IPO except that
they will be subject to a lock-up period of six months post-closing;
-- Mr. George Sagredos will transfer to Vanship, at no additional cost to
Vanship, 425,000 warrants purchased by a company controlled by him in a
private placement of units in Energy Infrastructure made prior to
Energy Infrastructure's July 2006 IPO;
-- As a condition to the closing of the Business Combination, Mr. George
Sagredos and Mr. Andreas Theotokis, Energy Infrastructure's Chairman of
the Board of Directors shall have agreed to the termination of stock
options to purchase an aggregate of 3,585,000 shares of common stock
(exercisable at $0.01 per share) that were issued to them prior to
Energy Infrastructure's July 2006 IPO;
-- Mr. George Sagredos (and any permitted assignee and/or transferee as
permitted by the Share Purchase Agreement) will be issued 1,000,000
units of EIMC, consisting of 1 share of common stock and 1 common stock
purchase warrant. These units will be identical to the units issued in
Energy Infrastructure's July 2006 IPO except that they will be subject
to a lock-up period of six months post-closing.
On a pro forma basis, as a result of the Business Combination, assuming the
full $50,000,000 equity investment is made by Vanship, Mr. Sagredos'
conversion of the convertible debt, the issuance of 1,000,000 units to Mr.
Sagredos, and without giving effect to the additional shares earnable in
the Earn Out Tranches:
-- there will be 46,990,247 total shares outstanding on an undiluted
basis;
-- there will be 53,247,054 total shares outstanding on a fully diluted
treasury method basis, and based on cash in trust of approximately
$10.30 per share as of September 30, 2007, which is the date of Energy
Infrastructure's most recent quarterly filing; and
-- on an undiluted basis, Vanship is expected to own approximately 39.4%
and the Company's management and directors are expected to own
approximately 15.7% of EIMC's outstanding shares of common stock, and
on a fully diluted treasury method basis, Vanship is expected to own
approximately 37.0% and the Company's management and directors are
expected to own approximately 14.5% of EIMC's outstanding shares of
common stock.
If the Business Combination is consummated, EIMC will be the first shipping
company headquartered in Asia to be publicly traded in the United States.
Upon delivery of the vessels from Vanship, EIMC's fleet will be comprised
of 5 double hull VLCCs and 4 single hull VLCCs. These VLCCs transport crude
oil principally from the Middle East to Asia. The vessels have a combined
cargo-carrying capacity of 2,519,213 deadweight tons ("dwt") and an average
age of approximately 12.4 years. The vessels are currently 100% chartered
out with an average remaining charter life of approximately 6.3 years.
Three of the nine vessels have profit sharing arrangements.
The table below provides summary information about the fleet:
Type of Vessel Daily Time Charter Type Charter Expiry
Hire Rate*
-------------- ------------------ -------------- -------------- -----
DH1 39,500 Time Charter May 2014 (1)
DH2 39,000 Time Charter February 2017 (2)
DH3 43,800 Time Charter December 2016
DH4 38,500 Time Charter January 2017 (3)
DH5 28,900 Time Charter* March 2009 (4)
DH5 30,000 Time Charter* March 2019 (4)(5)
SH1 29,800 Time Charter October 2010
SH2 32,000 Consecutive September 2009 (6)
Voyage Charter
SH3 32,800 Time Charter June 2010 (7)
SH4 39,088 Time Charter December 2011
* Gross time charter rate and net time charter equivalent (“TCE”) for
consecutive voyage charter.
(1) Charterers have the option to extend time charter for an additional 3
years at $39,000 per day.
(2) Based on 50% share of income (which is referenced to the Baltic
International Tanker Routes (“BITR”)) in excess of US$44,000.
(3) Income (which is referenced to BITR3) in excess of US$43,500 to be
split equally.
(4) Second time charter starts after expiry of first charter.
(5) Based on 50% of actual annual net average daily time charter earnings
(“actual earnings”) in excess of $30,000 but not exceeding $40,000, and
40% of actual earnings in excess of $40,000.
(6) Estimated TCE.
(7) Charterers have the option to extend time charter for an additional 2
years at $31,800 per day.
The average daily charter rate for double hull, or DH, vessels is
approximately $37,940, and the average daily charter rate for single hull,
or SH, vessels is approximately $33,422. The remaining charter life for DH
vessels is approximately 9.24 years, and the remaining charter life for SH
vessels is approximately 2.77 years.
Under the Share Purchase Agreement and subject to its ability to do so
under applicable law, EIMC will pay a dividend of $1.54 per share to EIMC's
public shareholders on the first anniversary of the consummation of the
Business Combination. Vanship has agreed, and it is a condition to the
closing that EIMC insiders shall have agreed, to waive any right to receive
dividend payments in respect of the one-year period immediately following
the consummation of the Business Combination in order to facilitate the
payment of this one-time dividend to the public shareholders.
Following the Business Combination, Vanship's founders and principals,
Captain Charles Arthur Joseph Vanderperre and Mr. Fred Cheng, will be
appointed as non-executive Chairman and Chief Executive Officer of EIMC,
respectively.
"We are pleased to bring this significant acquisition to our shareholders",
said Mr. Andreas Theotokis, Chairman of the Board of Energy Infrastructure.
"We believe that this transaction provides shareholders with an attractive
fleet, combining first-rate charter parties and high visibility of
medium-term cash flows, a solid platform for focused growth geared towards
the Asian markets and an experienced management team to take the company
forward."
"I am delighted at this opportunity to bring our fleet of fully employed
VLCCs to the public markets," said Mr. Fred Cheng, a founder and principal
of Vanship. "With the ever increasing demand for crude oil all over the
world, especially in China and India, the future of the VLCC fleet remains
extremely attractive for further and extensive investment. A public
platform provides the access to capital which will enable us to more fully
take advantage of the unique opportunities that we believe we can identify
and develop in the future."
It is intended that after the closing of the Business Combination,
technical management services in respect of the vessels will be provided by
Univan Ship Management Ltd., a leading technical ship management company
controlled by Captain Vanderperre, which has been in operation for over
thirty years and presently manages in excess of 50 vessels.
Each of the Acquisition and the Redomiciliation Merger are conditioned upon
the consummation of the other, and are each subject to customary closing
conditions, including the approval of Energy Infrastructure's stockholders.
Energy Infrastructure will also file a Current Report on Form 8-K
disclosing further details on the fleet acquisition and investment and
attaching a copy of the definitive Share Purchase Agreement.
In connection with the acquisition, Maxim Group LLC and The Investment Bank
of Greece, the investment banking arm of Marfin Group, acted as financial
advisors, New Century Capital Partners LLC rendered the fairness opinion,
and Loeb & Loeb LLP (NY) and Vgenopoulos & Partners Law Firm (Athens) acted
as legal advisors to Energy Infrastructure. Fortis Securities LLC acted as
financial advisor and Watson, Farley & Williams (New York) LLP and Lea &
White (Hong Kong) acted as legal advisors to Vanship.
About Energy Infrastructure
Energy Infrastructure is a blank check company that was formed for the
specific purpose of consummating a business combination. Energy
Infrastructure raised net proceeds of approximately $209.3 million, after
partial exercise of the underwriter's over-allotment option, through its
initial public offering consummated in July 2006 and has dedicated its time
since the initial public offering to seeking and evaluating business
combination opportunities.
About Vanship
Vanship is a shipping company focused on the Asian market with high quality
Asian charterers such as DOSCO (Dalian Cosco), Sinochem Corporation,
Formosa Petrochemical Corp., S-Oil Corporation, SK Shipping Corp. and Sanko
Steamship Ltd. The company was established in 2001, and operates from Hong
Kong in both the tanker and dry bulk segments of the shipping industry.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning
of the safe harbor provisions of the United States Private Securities
Litigation Reform Act of 1995. Forward-looking statements in this press
release include matters that involve known and unknown risks, uncertainties
and other factors that may cause actual results to differ materially from
results expressed or implied by this press release. The words "believe,"
"expect," "intend," "estimate," "anticipate," "will," "project,"
"forecast," "outlook" and similar expressions identify some, but not all,
of these forward-looking statements. The following factors, among others,
could cause actual results to differ from those set forth in the
forward-looking statements: the failure of Energy Infrastructure's
stockholders to approve the stock purchase agreement and the transactions
contemplated thereby; the number and percentage of Energy Infrastructure's
stockholders voting against the acquisition; the inability of either the
Company, EIMC or Vanship to satisfy the conditions to completion of the
acquisition; continued compliance with government regulations; legislation
or regulatory environments, requirements or changes adversely affecting the
businesses in which Vanship is engaged; demand for the services that
Vanship provides, general economic conditions; geopolitical events and
regulatory changes, as well as other relevant risks detailed in Energy
Infrastructure's filings with the Securities and Exchange Commission,
including its annual report on Form 10-K for the period ended December 31,
2006. The information set forth herein should be read in light of such
risks. The Company and EIMC undertake no obligation and do not intend to
update these forward-looking statements to reflect events or circumstances
occurring after the date of this press release. You are cautioned not to
place undue reliance on these forward-looking statements, which speak only
as of the date of this press release. All forward-looking statements are
qualified in their entirety by this cautionary statement.
Important Notices
THE COMPANY AND ITS DIRECTORS AND EXECUTIVE OFFICERS MAY BE DEEMED TO BE
PARTICIPANTS IN THE SOLICITATION OF PROXIES FOR THE SPECIAL MEETING OF THE
COMPANY'S STOCKHOLDERS TO BE HELD TO APPROVE THE TRANSACTION DESCRIBED IN
THIS PRESS RELEASE. THE COMPANY'S DIRECTORS AND EXECUTIVE OFFICERS HAVE
INTERESTS IN THE ACQUISITION, SOME OF WHICH MAY DIFFER FROM, OR MAY BE IN
ADDITION TO THOSE OF THE RESPECTIVE STOCKHOLDERS OF THE COMPANY GENERALLY.
THOSE INTERESTS WILL BE DESCRIBED IN GREATER DETAIL IN THE PROXY
STATEMENT/PROSPECTUS WITH RESPECT TO THE BUSINESS COMBINATION.
Additional Information about the Acquisition and Where to Find It
EIMC plans to file a Registration Statement on Form F-4 with the Securities
and Exchange Commission ("SEC") in connection with the merger, and Energy
Infrastructure expects to mail a Proxy Statement/Prospectus to stockholders
of Energy Infrastructure concerning the proposed acquisition and merger
transactions.
ENERGY INFRASTRUCTURE'S STOCKHOLDERS ARE URGED TO READ THE REGISTRATION
STATEMENT AND PROXY STATEMENT AND OTHER RELEVANT MATERIALS WHEN THEY BECOME
AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE TRANSACTION
AND RELATED MATTERS. STOCKHOLDERS WILL ALSO BE ABLE TO OBTAIN A COPY OF THE
DEFINITIVE PROXY STATEMENT, WITHOUT CHARGE, BY DIRECTING A REQUEST TO:
ENERGY INFRASTRUCTURE ACQUISITION CORP.
1105 NORTH MARKET STREET
SUITE 1300
WILMINGTON, DELAWARE 19801
ATTENTION: MS. SUSAN DUBB
TELEPHONE: (302) 655-1771
THE REGISTRATION STATEMENT, PRELIMINARY PROXY STATEMENT AND DEFINITIVE
PROXY STATEMENT, ONCE AVAILABLE, AND THE COMPANY'S ANNUAL REPORT ON FORM
10-K CAN ALSO BE OBTAINED, WITHOUT CHARGE, AT THE SECURITIES AND EXCHANGE
COMMISSION'S INTERNET SITE AT HTTP://WWW.SEC.GOV.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale
would be unlawful under the securities laws of such jurisdiction.
Contact Information: Contact: Investor Relations / Financial Media: Nicolas Bornozis President Capital Link, Inc. 230 Park Avenue, Suite 1536 New York, NY 10169 Tel: +1 212 661 7566 Email: nbornozis@capitallink.com www.capitallink.com Energy Infrastructure Acquisition Corp. 1105 North Market Street Suite 1300 Wilmington, Delaware 19801