UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant
to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant x
Filed by a Party other than the Registrant ¨
Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to Section
240.14a-12
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CAPITOL ACQUISITION CORP. II
(Name of Registrant as Specified In Its Charter)
_____________________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
x
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No fee required.
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Fee computed on table below per Exchange Act
Rules 14a-6(i) (1) and 0-11.
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(1)
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Title of each class of securities to which
transaction applies:
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(2)
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Aggregate number of securities to which
transaction applies:
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(3)
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Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11 (set forth
the amount on which the filing fee is calculated and state how it
was determined):
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(4)
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Proposed maximum aggregate value of
transaction:
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(5)
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Total fee paid:
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Fee paid previously with preliminary
materials.
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Check box if any part of the fee is offset as
provided by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or
Schedule and the date of its filing.
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(1)
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Amount Previously Paid:
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(2)
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Form, Schedule or Registration Statement
No.
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Filing Party:
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Date Filed:
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CAPITOL ACQUISITION
CORP. II
509
7th Street, N.W.
Washington, D.C. 20004
NOTICE OF SPECIAL
MEETING OF STOCKHOLDERS
TO BE HELD MAY 14,
2015
TO THE STOCKHOLDERS OF CAPITOL ACQUISITION CORP. II:
You are cordially invited to attend the special meeting (the
“special meeting”) of stockholders of Capitol
Acquisition Corp. II (“Capitol,” “Company,”
“we,” “us” or “our”) to be held
at 11:00 a.m. EDT on May 14, 2015 at the offices of Capitol’s
counsel Graubard Miller, 405 Lexington Avenue, New York, New York
10174, for the sole purpose of considering and voting upon the
following proposals:
•
a proposal to amend (the “Extension Amendment”)
Capitol’s amended and restated certificate of incorporation
(the “charter”) to extend the date by which Capitol has
to consummate a business combination (the “Extension”)
to July 31, 2015 (the “Extended Date”); and
•
a proposal to amend (the “Conversion Amendment”)
Capitol’s charter to allow the holders of shares of common
stock issued in Capitol’s initial public offering (the
“IPO”, and such shares sold in the IPO are referred to
as the “public shares”) to elect to convert their
public shares into their pro rata portion of the funds held in the
trust account established at the time of the IPO (the “trust
account”) if the Extension is implemented (the
“Conversion”).
Each of the Extension Amendment and the Conversion Amendment is
more fully described in the accompanying proxy statement.
The purpose of the Extension Amendment is to allow Capitol more
time to complete its previously announced proposed business
combination with Lindblad Expeditions, Inc.
(“Lindblad”) pursuant to the Agreement and Plan of
Merger, dated as of March 9, 2015, as amended from time to time
(the “merger agreement”), by and among Capitol, Argo
Expeditions, LLC, Capitol’s direct wholly-owned subsidiary
(“LLC Sub”), Argo Merger Sub, Inc., LLC Sub’s
direct wholly-owned subsidiary (“Merger Sub”), and
Lindblad. Capitol’s IPO prospectus and charter provided that
Capitol had until February 15, 2015 to complete a business
combination, unless it had executed a letter of intent by such
date, in which case it had until May 15, 2015 to consummate such a
business combination. Capitol executed a letter of intent with
Lindblad on January 7, 2015 and subsequently executed the merger
agreement on March 9, 2015, leaving approximately two months to
complete the business combination. The board currently believes
that there may not be sufficient time before May 15, 2015 to allow
the SEC to complete its review of the proxy statement relating to
the proposed transaction. Accordingly, our board believes that in
order to be able to pursue such investment opportunity, we may need
to obtain the Extension. Our board of directors believes that the
investment opportunity in Lindblad is compelling and that our
stockholders would benefit from it. Therefore, our board has
determined that it is in the best interests of our stockholders to
extend the date that Capitol has to consummate a business
combination to the Extended Date in order that our stockholders can
participate in this investment.
Capitol estimates that the per-share pro rata portion of the trust
account will be approximately $10.00 at the time of the special
meeting. The closing price of Capitol’s common stock on April
22, 2015 was $11.31. Accordingly, if the market price were to
remain the same until the date of the meeting, exercising
conversion rights would result in a public stockholder receiving
$1.31 less than if he sold his stock in the open market. Capitol
cannot assure stockholders that they will be able to sell their
shares of Capitol common stock in the open market, even if the
market price per share is higher than the conversion price stated
above, as there may not be sufficient liquidity in its securities
when such stockholders wish to sell their shares.
The purpose of the Conversion Amendment is to afford holders of the
public shares (the “public stockholders”) at the time
of the IPO the right to receive their pro rata portion of the trust
account within the timeframe contemplated at the time of our IPO,
notwithstanding the Extension. Accordingly, Capitol is offering
through the Conversion Amendment the ability for holders of public
shares to participate in the Conversion, notwithstanding the
Extension and regardless of whether the holder votes for or against
the Extension Amendment. Approval of the Conversion Amendment is a
condition to the implementation of the Extension. In order to
convert your public shares, however, you must vote in favor of the
Conversion Amendment. You are not required to convert your
public shares even if you vote in favor of the Conversion
Amendment. If any public stockholders so elect, Capitol anticipates
notifying the trustee promptly after the special meeting, which is
scheduled for May 14, 2015, to liquidate the trust account in an
amount equal to the total pro rata portion of the converted
shares.
If the Extension Amendment and Conversion Amendment proposals are
not approved and we do not consummate a business combination by May
15, 2015, as contemplated by our IPO prospectus and in accordance
with our charter, we will (i) cease all operations except for the
purpose of winding up and (ii) as promptly as reasonably possible
but not more than ten business days thereafter, redeem 100% of the
outstanding public shares with the aggregate amount then on deposit
in the trust account.
Subject to the foregoing, the affirmative vote of a majority of
Capitol’s outstanding common stock voting for the Extension
Amendment and Conversion Amendment proposals will be required to
approve the Extension Amendment and the Conversion Amendment.
The Capitol board of directors has fixed the close of business on
April 22, 2015 as the date for determining Capitol stockholders
entitled to receive notice of and vote at the special meeting and
any adjournment thereof. Only holders of record of Capitol common
stock on that date are entitled to have their votes counted at the
special meeting or any adjournment thereof.
You are not being asked
to vote on the proposed business combination with Lindblad at this
time. If you are a public stockholder, you will have the right to
vote on the proposed business combination with Lindblad when it is
submitted to stockholders
After careful consideration of all relevant factors,
Capitol’s board of directors has determined that the
Extension Amendment and Conversion Amendment proposals are fair to
and in the best interests of Capitol and its stockholders, has
declared them advisable and recommends that you vote or give
instruction to vote “FOR” them.
Under Delaware law and Capitol’s bylaws, no other business
may be transacted at the special meeting.
Enclosed is the proxy statement containing detailed information
concerning the Extension Amendment, the Conversion Amendment and
the special meeting. Whether or not you plan to attend the special
meeting, we urge you to read this material carefully and vote your
shares.
I look forward to seeing you at the meeting.
May 4, 2015
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By Order of the Board of Directors
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Mark D. Ein
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Chairman and Chief Executive Officer
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Your vote is important.
Please sign, date and return your proxy card as soon as possible to
make sure that your shares are represented at the special meeting.
If you are a stockholder of record, you may also cast your vote in
person at the special meeting. If your shares are held in an
account at a brokerage firm or bank, you must instruct your broker
or bank how to vote your shares, or you may cast your vote in
person at the special meeting by obtaining a proxy from your
brokerage firm or bank. Your failure to vote or instruct your
broker or bank how to vote will have the same effect as voting
against each of the proposals.
Important Notice
Regarding the Availability of Proxy Materials for the Special
Meeting of Stockholders to be held on May 14, 2015: This
notice of meeting and the accompany proxy statement are available
at http://www.cstproxy.com/capitolacquisition/sm2015.
CAPITOL ACQUISITION
CORP. II
509
7th Street, N.W.
Washington, D.C. 20004
SPECIAL MEETING OF
STOCKHOLDERS
TO BE HELD MAY 14,
2015
PROXY
STATEMENT
The special meeting (the “special meeting”) of
stockholders of Capitol Acquisition Corp. II
(“Capitol,” “Company,” “we,”
“us” or “our”), a Delaware corporation,
will be held at 11:00 a.m. EDT on May 14, 2015, at the offices of
Capitol’s counsel Graubard Miller, 405 Lexington Avenue, New
York, New York 10174, for the sole purpose of considering and
voting upon the following proposals:
•
a proposal to amend (the “Extension Amendment”)
Capitol’s amended and restated certificate of incorporation
(the “charter”) to extend the date by which Capitol has
to consummate a business combination (the “Extension”)
to July 31, 2015 (the “Extended Date”); and
•
a proposal to amend (the “Conversion Amendment”)
Capitol’s charter to allow the holders of shares of common
stock issued in Capitol’s initial public offering (the
“IPO”, and such shares sold in the IPO are referred to
as the “public shares”) to elect to convert their
public shares into their pro rata portion of the funds held in the
trust account established at the time of the IPO (the “trust
account”) if the Extension is implemented (the
“Conversion”).
The Extension Amendment and the Conversion Amendment proposals are
essential to the overall implementation of the board of
directors’ plan to extend the date that Capitol has to
complete a business combination. The purpose of the Extension
Amendment and the Conversion Amendment is to allow Capitol more
time to complete its previously announced proposed business
combination with Lindblad Expeditions, Inc.
(“Lindblad”) pursuant to the Agreement and Plan of
Merger, dated as of March 9, 2015, as amended from time to time
(the “Merger Agreement”), by and among Capitol, Argo
Expeditions, LLC, Capitol’s direct wholly-owned subsidiary
(“LLC Sub”), Argo Merger Sub, Inc., LLC Sub’s
direct wholly-owned subsidiary (“Merger Sub”), and
Lindblad.
Approval of the Extension Amendment and the Conversion Amendment is
a condition to the implementation of the Extension. In addition, we
will not proceed with the Extension if we do not have at least
$5,000,001 of net tangible assets following approval of the
Extension Amendment and Conversion Amendment proposals, after
taking into account the Conversion.
The withdrawal of funds from the trust account in connection with
the Conversion will reduce the amount held in the trust account
following the Conversion and the amount remaining in the trust
account may be only a small fraction of the approximately $200
million that was in the trust account as of December 31, 2014. In
such event, Capitol may need to obtain additional funds to complete
the proposed business combination with Lindblad and there can be no
assurance that such funds will be available on terms acceptable to
the parties or at all.
If the Extension Amendment and Conversion Amendment proposals are
not approved and we do not consummate a business combination by May
15, 2015, as contemplated by our IPO prospectus and in accordance
with our charter, we will (i) cease all operations except for the
purpose of winding up, (ii) as promptly as reasonably possible but
not more than ten business days thereafter, redeem 100% of the
outstanding public shares, at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account,
including any interest but net of franchise and income taxes
payable, divided by the number of then outstanding public shares,
which redemption will completely extinguish public
stockholders’ rights as stockholders (including the right to
receive further liquidation distributions, if any), subject to
applicable law, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of our remaining
stockholders and our board of directors, dissolve and liquidate,
subject (in the case of (ii) and (iii) above) to our obligations
under Delaware law to provide for claims of creditors and the
requirements of other applicable law.
Capitol’s initial stockholders prior to the IPO have waived
their rights to participate in any liquidation distribution with
respect to their initial shares. As a consequence of such waivers,
a liquidating distribution will
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be made only with respect to the public shares. There will be no
distribution from the trust account with respect to Capitol’s
warrants, which will expire worthless in the event we wind up.
If Capitol liquidates, Capitol’s executive officers have
agreed that they will be personally liable to pay debts and
obligations to third parties or target businesses that are owed
money by us for services rendered or contracted for or products
sold to us in excess of the net proceeds of this offering not held
in the trust account but only if, and to the extent, that the
claims would otherwise reduce the amount in the trust account
payable to its public stockholders in the event of a liquidation,
and only if such a third party or prospective target business does
not execute a valid and enforceable waiver. There is no assurance,
however, that they will be able to satisfy those obligations. Based
on the cash available to Capitol outside of its trust account for
working capital and Capitol’s outstanding expenses owed to
all creditors (both those that have signed trust fund waivers and
those that have not), it is not anticipated that Capitol’s
executive officers will have any indemnification obligations.
Accordingly, regardless of whether an indemnification obligation
exists, the per share liquidation price for the public shares is
anticipated to be approximately $10.00. Nevertheless, Capitol
cannot assure you that the per share distribution from the trust
account, if Capitol liquidates, will not be less than $10.00, plus
interest, due to unforeseen claims of creditors.
Under the Delaware General Corporation Law (the
“DGCL”), stockholders may be held liable for claims by
third parties against a corporation to the extent of distributions
received by them in a dissolution. If the corporation complies with
certain procedures set forth in Section 280 of the DGCL intended to
ensure that it makes reasonable provision for all claims against
it, including a 60-day notice period during which any third-party
claims can be brought against the corporation, a 90-day period
during which the corporation may reject any claims brought, and an
additional 150-day waiting period before any liquidating
distributions are made to stockholders, any liability of
stockholders with respect to a liquidating distribution is limited
to the lesser of such stockholder’s pro rata share of the
claim or the amount distributed to the stockholder, and any
liability of the stockholder would be barred after the third
anniversary of the dissolution.
However, because Capitol will not be complying with Section 280 of
the DGCL, Section 281(b) of the DGCL requires us to adopt a plan,
based on facts known to us at such time that will provide for our
payment of all existing and pending claims or claims that may be
potentially brought against us within the subsequent ten years.
However, because we are a blank check company, rather than an
operating company, and our operations will be limited to searching
for prospective target businesses to acquire, the only likely
claims to arise would be from our vendors (such as lawyers,
investment bankers, etc.) or prospective target businesses.
If the Extension Amendment and the Conversion Amendment proposals
are approved, the approval of the Conversion will constitute
consent for Capitol to (i) remove from the trust account an amount
(the “Withdrawal Amount”) equal to the pro rata portion
of funds available in the trust account relating to the converted
public shares and (ii) deliver to the holders of such converted
public shares their pro rata portion of the Withdrawal Amount. The
remainder of such funds shall remain in the trust account and be
available for use by Capitol to complete a business combination on
or before the Extended Date. Holders of public shares who do not
convert their public shares now, will retain their conversion
rights and their ability to vote on a business combination through
the Extended Date if the Extension Amendment is approved.
At the time the Extension Amendment becomes effective, Capitol will
also amend the trust account agreement to (i) permit the withdrawal
of the Withdrawal Amount from the trust account and (ii) extend the
date on which to liquidate the trust account to the Extended
Date.
The record date for the special meeting is April 22, 2015. Record
holders of Capitol common stock at the close of business on the
record date are entitled to vote or have their votes cast at the
special meeting. On the record date, there were 25,000,000
outstanding shares of Capitol common stock including 20,000,000
outstanding public shares. Capitol’s warrants do not have
voting rights.
This proxy statement contains important information about the
special meeting and the proposals. Please read it carefully and
vote your shares.
This proxy statement is dated May 4, 2015 and is first being mailed
to stockholders on or about that date.
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QUESTIONS AND ANSWERS
ABOUT THE SPECIAL MEETING
These Questions and Answers are only summaries of the matters they
discuss. They do not contain all of the information that may be
important to you. You should read carefully the entire document,
including the annexes to this proxy statement.
Q.
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Why am I receiving this proxy
statement?
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A. Capitol is a blank check company formed
in 2010 for the purpose of entering into a merger, share exchange,
asset acquisition, stock purchase, recapitalization, reorganization
or other similar business combination with one or more businesses
or entities. In May 2013, Capitol consummated its IPO from which it
derived gross proceeds of $200,000,000, including proceeds from the
partial exercise of the underwriters’ over-allotment option.
Like most blank check companies, our charter provides for the
return of the IPO proceeds held in trust to the holders of shares
of common stock sold in the IPO if there is no qualifying business
combination(s) consummated on or before a certain date (in our
case, May 15, 2015). The board of directors believes that it is in
the best interests of the stockholders to continue Capitol’s
existence until the Extended Date in order to allow Capitol more
time to complete its previously announced proposed business
combination with Lindblad and is submitting these proposals to the
stockholders to vote upon.
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What is being voted on?
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A. You are being asked to vote
on:
• a proposal to
amend Capitol’s charter to extend the date by which Capitol
has to consummate a business combination to the Extended Date;
and
• a proposal to
amend Capitol’s charter to allow the holders of public shares
to elect to convert their public shares into their pro rata portion
of the funds held in the trust account if the Extension is
implemented.
The Extension Amendment and the Conversion
Amendment proposals are essential to the overall implementation of
the board of directors’ plan to extend the date that Capitol
has to complete a business combination. Approval of the Extension
Amendment and the Conversion Amendment is a condition to the
implementation of the Extension.
If the Extension is implemented, the
stockholder’s approval of the Conversion Amendment proposal
will constitute consent for Capitol to remove the Withdrawal Amount
from the trust account, deliver to the holders of such converted
public shares the pro rata portion of the Withdrawal Amount and
retain the remainder of the funds in the trust account for
Capitol’s use in connection with consummating a business
combination on or before the Extended Date.
We will not proceed if we do not have at least
$5,000,001 of net tangible assets following approval of the
Extension Amendment and Conversion Amendment proposals, after
taking into account the Conversion.
If the Extension Amendment and Conversion
Amendment proposals are approved and the Extension is implemented,
the removal of the Withdrawal Amount from the trust account in
connection with the Conversion will reduce the amount held in the
trust account following the Conversion. Capitol cannot predict the
amount that will remain in the trust account if the Extension
Amendment and Conversion Amendment proposals are approved and the
amount remaining in the trust account may be only a small fraction
of the approximately $200 million that was in the trust account as
of December 31, 2014. In such event, Capitol may need to obtain
additional funds to complete the proposed business combination with
Lindblad and there can be no assurance that such funds will be
available on terms acceptable to the parties or at all.
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If the Extension Amendment and Conversion
Amendment proposals are not approved and we have not consummated a
business combination by May 15, 2015, we will (i) cease all
operations except for the purpose of winding up, (ii) as promptly
as reasonably possible but not more than ten business days
thereafter, redeem 100% of the outstanding public shares, at a
per-share price, payable in cash, equal to the aggregate amount
then on deposit in the trust account, including any interest but
net of franchise and income taxes payable, divided by the number of
then outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders
(including the right to receive further liquidation distributions,
if any), subject to applicable law, and (iii) as promptly as
reasonably possible following such redemption, subject to the
approval of our remaining stockholders and our board of directors,
dissolve and liquidate, subject (in the case of (ii) and (iii)
above) to our obligations under Delaware law to provide for claims
of creditors and the requirements of other applicable
law.
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Capitol’s initial stockholders have waived
their rights to participate in any liquidation distribution with
respect to their initial shares. There will be no distribution from
the trust account with respect to our warrants, which will expire
worthless in the event we wind up. Capitol will pay the costs of
liquidation from its remaining assets outside of the trust account.
If such funds are insufficient, Capitol’s executive officers
have agreed to advance it the funds necessary to complete such
liquidation (currently anticipated to be no more than approximately
$15,000) and have agreed not to seek repayment of such
expenses.
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Q.
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Why is the Company proposing the Extension
Amendment and the Conversion Amendment proposals?
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A. Capitol’s charter provides for the
return of the IPO proceeds held in trust to the holders of shares
of common stock sold in the IPO if there is no qualifying business
combination(s) consummated on or before May 15, 2015. As we explain
below, Capitol may not be able to complete the business combination
with Lindblad by that date.
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On March 9, 2015, Capitol entered into the
Merger Agreement, by and among Capitol, LLC Sub, Merger Sub and
Lindblad. Pursuant to the Merger Agreement, Merger Sub will be
merged with and into Lindblad to form an interim corporation
(“Interim Corporation”) as a direct wholly-owned
subsidiary of LLC Sub (the “initial merger”), and such
Interim Corporation shall immediately thereafter be merged with and
into LLC Sub to form the surviving company (“Surviving
Company”) as a direct wholly-owned subsidiary of Capitol (the
“subsequent merger” and together with the initial
merger, the “mergers”). The Lindblad stockholders will
receive an aggregate of (i) $90,000,000 in cash at the closing (a
portion of which will be for transaction bonuses) and (ii)
20,017,787 shares of Capitol common stock. Capitol will also assume
outstanding Lindblad stock options and will issue options to
purchase approximately 3,982,212 shares of Capitol common stock to
the Lindblad stock option holders.
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Lindblad provides expedition cruising and
adventure travel experiences. The company provides itineraries that
feature up-close encounters with wildlife and nature and promote
guest empowerment and interactivity. Through a partnership with The
National Geographic Society (“National Geographic”),
Lindblad’s educationally oriented voyages allow guests to
interact with leading scientists, naturalists and researchers while
discovering stunning natural environments, above and below the sea,
through state-of-the-art exploration tools.
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In connection
with the mergers, the stockholders of Capitol prior to its initial
public offering – Capitol Acquisition Management 2 LLC, an
affiliate of Mark D. Ein, Capitol’s Chief Executive Officer,
L. Dyson Dryden, Capitol’s Chief Financial Officer, and
Lawrence Calcano, Richard C. Donaldson and Piyush Sodha, each a
director of Capitol – have collectively agreed to make a
charitable contribution of an aggregate of 500,000 founder’s
shares to Lindblad Expeditions-National Geographic Joint Fund for
Exploration and Conservation for no additional consideration. These
founder’s shares, which are currently in escrow, are
comprised of (i) 375,000 shares of common stock to be contributed
one day after the closing of the mergers, provided that they remain
subject to the terms of such escrow, and (ii) 125,000 shares of
incentive common stock, subject to forfeiture if Capitol’s
common stock does not trade above $13.00 per share for any 20
trading days during any 30-day period within 4 years of
consummation of the mergers, to be contributed within three
business days after their release from escrow in connection with
the lapse of such forfeiture conditions.
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The
foregoing summary of the terms of the Merger Agreement is qualified
in all respects by reference to the complete text of the Merger
Agreement, which is attached as Exhibit 2.1 to the Form 8-K Capitol
filed with the SEC on March 10, 2015, as the same may be amended
from time to time, which amendments will be filed by Capitol with
the SEC on Form 8-K
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The proposed business combination with Lindblad
qualifies as a “business combination” under
Capitol’s amended and restated certificate. However, Capitol
may not be able to consummate the business combination with
Lindblad by May 15, 2015 given when the Merger Agreement was signed
and the actions that must occur prior to closing.
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Capitol believes the proposed business
combination with Lindblad would be in the best interests of
Capitol’s stockholders, and because Capitol may not be able
to conclude a business combination within the permitted time
period, Capitol has determined to seek stockholder approval to
extend the date by which Capitol has to complete a business
combination.
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Capitol believes that given Capitol’s
expenditure of time, effort and money on the proposed business
combination with Lindblad, circumstances warrant providing public
stockholders an opportunity to consider the proposed business
combination with Lindblad. Accordingly, Capitol’s board of
directors is proposing the Extension Amendment to extend
Capitol’s corporate existence until the Extended Date and to
allow for the Conversion.
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You
are not being asked to vote on the proposed business combination
with Lindblad at this time. If the Extension is implemented and you
do not elect to convert your public shares, you will retain the
right to vote on the proposed business combination with Lindblad
when it is submitted to stockholders and the right to convert your
public shares into a pro rata portion of the trust account in the
event the proposed business combination is approved and completed
or the Company has not consummated a business combination by the
Extended Date.
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Q.
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Why should I vote for the Extension
Amendment?
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A. Capitol’s board of directors
believes stockholders will benefit from Capitol consummating the
business combination with Lindblad and is proposing the Extension
Amendment to extend the date by which Capitol has to complete a
business combination until the Extended Date and to allow for the
Conversion. The Extension would give Capitol the opportunity to
complete a business combination.
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5
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Capitol’s charter purports to prohibit
amendment to certain of its provisions, including any amendment
that would extend its corporate existence beyond the deadlines
discussed above, except in connection with, and effective upon
consummation of, a business combination. Capitol’s IPO
prospectus did not suggest in any way that this charter provision,
or the charter’s other business combination procedures, were
subject to change. We believe that these charter provisions were
included to protect Capitol stockholders from having to sustain
their investments for an unreasonably long period, if Capitol
failed to find a suitable business combination in the timeframe
contemplated by the charter, and the application of those
investments without the stockholder review customarily provided for
them. We also believe, however, that given Capitol’s
expenditure of time, effort and money on the potential business
combination with Lindblad, circumstances warrant providing those
who believe they might find the potential business combination to
be an attractive investment with an opportunity to consider such a
transaction, inasmuch as Capitol is also affording stockholders who
wish to convert their public shares as originally contemplated, the
opportunity to do so as well. Accordingly, we believe that the
Extension is consistent with the spirit in which Capitol offered
its securities to the public.
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Q.
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Should I vote for the Conversion
Amendment?
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A. Approval of the Conversion Amendment is
a condition to the implementation of the Extension
Amendment.
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Whether a holder of public shares votes in favor
of or against the Extension Amendment, the holder may, but is not
required to, convert all or a portion of its public shares into the
pro rata portion of the trust account represented by the converted
shares. In order to convert your public shares, you must vote in
favor of the Conversion Amendment; however, if you vote in favor of
the Conversion Amendment, you are not required to convert your
public shares. We will not proceed if we do not have at least
$5,000,001 of net tangible assets following approval of the
Extension Amendment and Conversion Amendment proposals, after
taking into account the Conversion.
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Liquidation of the trust account is a
fundamental obligation of Capitol to the public stockholders and
Capitol is not proposing and will not propose to change that
obligation to the public stockholders. If holders of public shares
do not elect to convert their public shares, such holders shall
retain conversion rights in connection with any future business
combination Capitol proposes. Assuming the Extension Amendment is
approved, Capitol will have until the Extended Date to complete a
business combination.
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Capitol’s board of directors recommends
that you vote in favor of the Conversion Amendment proposal, but
expresses no opinion as to whether you should convert your public
shares.
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Q.
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How do the Capitol insiders intend to vote their
shares?
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A. All of Capitol’s directors,
executive officers and their respective affiliates are expected to
vote any common stock over which they have voting control
(including any public shares owned by them) in favor of the
Extension Amendment and Conversion Amendment proposals.
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Capitol’s directors, executive officers
and their respective affiliates are not entitled to convert the
shares of Capitol common stock acquired by them prior to the IPO
(the “insider shares”). With respect to shares
purchased on the open market by Capitol’s directors,
executive officers and their respective affiliates, such public
shares may be converted. On the record date, Capitol’s
directors, executive officers and their affiliates beneficially
owned and were entitled to vote 5,000,000 insider shares of Capitol
common stock, representing approximately 20% of Capitol’s
issued and outstanding common stock. Capitol’s directors,
executive officers and their affiliates did not beneficially own
any public shares as of such date.
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6
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Capitol’s or Lindblad’s directors,
executive officers and their affiliates may choose to buy public
shares in the open market and/or through negotiated private
purchases. In the event that purchases do occur, the purchasers may
seek to purchase shares from stockholders who would otherwise have
voted against the Extension Amendment. Any public shares held by or
subsequently purchased by affiliates of Capitol may be voted in
favor of the Extension Amendment and the Conversion Amendment
proposals.
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Q.
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What vote is required to adopt the Extension
Amendment?
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A. Approval of the Extension Amendment will
require the affirmative vote of holders of a majority of
Capitol’s outstanding common stock on the record date.
Approval of the Conversion Amendment is a condition to the
implementation of the Extension Amendment.
Our board of
directors believes that decisions regarding Capitol’s future,
such as whether to continue its existence or have its existence
terminate, should be determined by Capitol’s current
stockholders and they should not be bound by the restrictions
implemented by the stockholders at the time of the IPO. The current
stockholders should not be prohibited from amending the charter to
allow Capitol to continue its existence, especially since all
holders of public shares are being offered the opportunity to
convert their public shares and receive their pro rata portion of
the trust account in connection with the approval of the proposals
and such conversion will occur close in time to May 15, 2015 as
contemplated in our IPO prospectus and charter.
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Q.
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What vote is required to approve the Conversion
Amendment?
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A. Approval of the Conversion Amendment
will require the affirmative vote of holders of a majority of
Capitol’s outstanding common stock on the record
date.
Any holder of public shares that votes in favor
of the Conversion Amendment may convert all or a portion of their
public shares into their pro rata portion of the trust account. In
order to convert your public shares, you must vote in favor of the
Conversion Amendment; however, if you vote in favor of the
Conversion Amendment, you are not required to convert your public
shares.
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Q.
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Since Capitol’s IPO prospectus states that
Capitol would not amend Article Sixth except in connection with a
business combination, what are my legal rights?
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A. You should be aware that Capitol’s
IPO prospectus stated that Capitol would not take any action to
amend or waive Article Sixth of its charter (except in connection
with, and upon the effectiveness of, a business combination),
including, to allow it to survive for a longer period of time. As a
result, each stockholder may have securities law claims against
Capitol for rescission (under which a successful claimant has the
right to receive the total amount paid for his or her securities
pursuant to an allegedly deficient prospectus, plus interest and
less any income earned on the securities, in exchange for surrender
of the securities) or damages (compensation for loss on an
investment caused by alleged material misrepresentations or
omissions in the sale of a security). For more information, see
“The Extension
Amendment and Conversion Amendment Proposals—Possible Claims
Against and Impairment of the Trust
Account.”
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Q.
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What if I don’t want to vote for the
Extension Amendment or Conversion proposal?
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A. If you do not want the Extension
Amendment or Conversion Amendment to be approved, you must abstain,
not vote, or vote against the proposals. If the Extension Amendment
and the Conversion Amendment are approved, and the Extension is
implemented, then the Withdrawal Amount will be withdrawn from the
trust account and paid to the converting holders. However, as
discussed above and elsewhere in this proxy statement, the
Extension Amendment may result in claims against Capitol whose
holders might seek to have the claims satisfied from funds in the
trust account, which could result in depletion of the trust account
and in turn reduce a public stockholder’s pro rata portion of
the funds available in the trust account upon the completion of a
business combination or upon liquidation.
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7
Q.
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Will you seek any further extensions to
liquidate the trust account?
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A. Other
than the extension until the Extended Date as described in this
proxy statement, Capitol does not anticipate seeking any further
extension to consummate a business combination. Capitol’s
board of directors recognizes that Capitol’s IPO prospectus
stated that Capitol would not take any action allowing it to
survive for a longer period of time except in connection with, and
effective upon, the consummation of a business combination. Capitol
has provided that all holders of public shares, including those who
vote against the Extension Amendment, but not those who vote
against the Conversion Amendment, may elect to convert their public
shares into their pro rata portion of the trust account and should
receive the funds shortly after the stockholder meeting which is
scheduled for May 14, 2015. Those holders of public shares who
elect not to convert their shares now shall retain conversion
rights with respect to future business combinations, or, if no
future business combination is brought to a vote of the
shareholders or if a business combination is not completed for any
reason, such holders shall be entitled to the pro rata portion of
the trust account on the Extended Date.
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Q.
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What happens if the Extension Amendment is not
approved?
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A. If the Extension Amendment is not
approved and we have not consummated a business combination by May
15, 2015, we will (i) cease all operations except for the purpose
of winding up, (ii) as promptly as reasonably possible but not more
than ten business days thereafter, redeem 100% of the outstanding
public shares, at a per-share price, payable in cash, equal to the
aggregate amount then on deposit in the trust account, including
any interest but net of franchise and income taxes payable, divided
by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as
stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject
to the approval of our remaining stockholders and our board of
directors, dissolve and liquidate, subject (in the case of (ii) and
(iii) above) to our obligations under Delaware law to provide for
claims of creditors and the requirements of other applicable
law.
Capitol’s
initial stockholders waived their rights to participate in any
liquidation distribution with respect to their initial shares.
There will be no distribution from the trust account with respect
to our warrants which will expire worthless in the event we wind
up. Capitol will pay the costs of liquidation from its remaining
assets outside of the trust account, which it believes are
sufficient for such purposes. If such funds are insufficient,
Capitol’s executive officers have agreed to advance it the
funds necessary to complete such liquidation (currently anticipated
to be no more than approximately $15,000) and have agreed not to
seek repayment of such expenses.
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Q.
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If the Extension Amendment and Conversion
Amendment proposals are approved, what happens
next?
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A. Capitol is continuing its efforts to
complete the proposed business combination with Lindblad, which
will involve:
• completing
proxy materials;
• establishing a meeting date and
record date for considering the proposed acquisition, and
distributing proxy materials to stockholders; and
• holding a special meeting to consider the
proposed business combination with Lindblad.
Capitol is
seeking approval of the Extension Amendment and the Conversion
Amendment because Capitol may not be able to complete all of the tasks
listed above prior to May 15, 2015. Capitol has filed a preliminary
proxy statement and, if the Extension Amendment and Conversion
Amendment are approved, expects to seek stockholder approval of the
proposed business combination with Lindblad. If stockholders
approve the proposed business combination with Lindblad, Capitol
expects to consummate the business combination as soon as possible
following stockholder approval.
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8
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Upon approval by a
majority of the common stock outstanding as of the record date of
the Extension Amendment and Conversion Amendment proposals, Capitol
will file an amendment to the charter with the Secretary of State
of the State of Delaware in the form of Annex A hereto. Capitol
will remain a reporting company under the Securities Exchange Act
of 1934 and its units, common stock and warrants will remain
publicly traded.
If the Extension Amendment and Conversion
Amendment proposals are approved, the removal of the Withdrawal
Amount from the trust account will reduce the amount remaining in
the trust account and increase the percentage interest of
Capitol’s common stock held by Capitol’s directors and
officers through the insider shares.
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Q.
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Would I still be able to exercise my conversion
rights if I vote against the proposed business combination with
Lindblad?
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A. Unless you elect to convert your shares,
you will be able to vote on the proposed business combination with
Lindblad when it is submitted to stockholders. If you disagree with
the business combination, you will retain your right to convert
your public shares upon consummation of a business combination in
connection with the stockholder vote to approve the business
combination, subject to any limitations set forth in the amended
and restated certificate.
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Q.
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How do I change my vote?
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A. If you have submitted a proxy to vote
your shares and wish to change your vote, you may do so by
delivering a later-dated, signed proxy card to Capitol’s
secretary prior to the date of the special meeting or by voting in
person at the special meeting. Attendance at the special meeting
alone will not change your vote. You also may revoke your proxy by
sending a notice of revocation to Capitol located at 509
7th Street, N.W., Washington, D.C. 20004, Attn:
Corporate Secretary.
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Q.
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How are votes counted?
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A. Votes will be counted by the inspector
of election appointed for the meeting, who will separately count
“FOR” and “AGAINST” votes, abstentions and
broker non-votes. Each of the Extension Amendment and Conversion
Amendment proposals must be approved by the affirmative vote of a
majority of the outstanding shares as of the record date of
Capitol’s common stock, voting together as a single
class.
With respect to the Extension Amendment and
Conversion Amendment proposals, abstentions and broker non-votes
will have the same effect as “AGAINST” votes. If your
shares are held by your broker as your nominee (that is, in
“street name”), you may need to obtain a proxy form
from the institution that holds your shares and follow the
instructions included on that form regarding how to instruct your
broker to vote your shares. If you do not give instructions to your
broker, your broker can vote your shares with respect to
“discretionary” items, but not with respect to
“non-discretionary” items. Discretionary items are
proposals considered routine under the rules of the New York Stock
Exchange applicable to member brokerage firms. These rules provide
that for routine matters your broker has the discretion to vote
shares held in street name in the absence of your voting
instructions. On non-discretionary items for which you do not give
your broker instructions, the shares will be treated as broker
non-votes.
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Q.
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If my shares are held in “street
name,” will my broker automatically vote them for
me?
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A. No. Your broker can vote your shares
only if you provide instructions on how to vote. You should
instruct your broker to vote your shares. Your broker can tell you
how to provide these instructions.
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9
Q.
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What is a quorum requirement?
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A. A quorum of stockholders is necessary to
hold a valid meeting. A quorum will be present if at least a
majority of the outstanding shares of common stock on the record
date are represented by stockholders present at the meeting or by
proxy.
Your shares will be counted towards the quorum
only if you submit a valid proxy (or one is submitted on your
behalf by your broker, bank or other nominee) or if you vote in
person at the special meeting. Abstentions and broker non-votes
will be counted towards the quorum requirement. If there is no
quorum, a majority of the votes present at the special meeting may
adjourn the special meeting to another date.
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Q.
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Who can vote at the special
meeting?
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A. Only holders of record of
Capitol’s common stock at the close of business on April 22,
2015 are entitled to have their vote counted at the special meeting
and any adjournments or postponements thereof. On this record date,
25,000,000 shares of common stock were outstanding and entitled to
vote.
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Stockholder of Record: Shares Registered in Your
Name. If on the record date
your shares were registered directly in your name with
Capitol’s transfer agent, Continental Stock Transfer &
Trust Company, then you are a stockholder of record. As a
stockholder of record, you may vote in person at the special
meeting or vote by proxy. Whether or not you plan to attend the
special meeting in person, we urge you to fill out and return the
enclosed proxy card to ensure your vote is counted.
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Beneficial Owner: Shares Registered in the Name of a Broker
or Bank. If on the record
date your shares were held, not in your name, but rather in an
account at a brokerage firm, bank, dealer, or other similar
organization, then you are the beneficial owner of shares held in
“street name” and these proxy materials are being
forwarded to you by that organization. As a beneficial owner, you
have the right to direct your broker or other agent on how to vote
the shares in your account. You are also invited to attend the
special meeting. However, since you are not the stockholder of
record, you may not vote your shares in person at the special
meeting unless you request and obtain a valid proxy from your
broker or other agent.
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Q.
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Does the board recommend voting for the approval
of the Extension Amendment and the Conversion
Amendment?
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A. Yes. After careful consideration of the
terms and conditions of these proposals, the board of directors of
the Company has determined that the Extension Amendment and the
Conversion Amendment are fair to and in the best interests of
Capitol and its stockholders. The board of directors recommends
that Capitol’s stockholders vote “FOR” the
Extension Amendment and the Conversion Amendment.
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Q.
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What interests do the Company’s directors
and officers have in the approval of the
proposals?
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A. Capitol’s directors and officers
have interests in the proposals that may be different from, or in
addition to, your interests as a stockholder. These interests
include ownership of insider shares and warrants that may become
exercisable in the future, loans by them that will not be repaid in
the event of our winding up and the possibility of future
compensatory arrangements. See the section entitled
“The Extension
Amendment and Conversion Amendment Proposals—Interests of
Capitol’s Directors and Officers.”
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Q.
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What if I object to the Extension Amendment and
the Conversion Amendment? Do I have appraisal
rights?
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A. Capitol stockholders do not have
appraisal rights in connection with the Extension Amendment or the
Conversion Amendment under the DGCL.
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10
Q.
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What happens to the Capitol warrants if the
Extension Amendment is not approved?
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A. If the Extension Amendment is not
approved and we have not consummated a business combination by May
15, 2015, we will (i) cease all operations except for the purpose
of winding up, (ii) as promptly as reasonably possible but not more
than ten business days thereafter, redeem 100% of the outstanding
public shares, at a per-share price, payable in cash, equal
to the aggregate amount then on deposit in the trust account,
including any interest but net of franchise and income taxes
payable, divided by the number of then outstanding public shares,
which redemption will completely extinguish public
stockholders’ rights as stockholders (including the right to
receive further liquidation distributions, if any), subject to
applicable law, and (iii) as promptly as reasonably possible
following such redemption, subject to the approval of our remaining
stockholders and our board of directors, dissolve and liquidate,
subject (in the case of (ii) and (iii) above) to our obligations
under Delaware law to provide for claims of creditors and the
requirements of other applicable law. In such event, your warrants
will become worthless.
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Q.
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What happens to the Capitol warrants if the
Extension Amendment and Conversion Amendment proposals are
approved?
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A. If the
Extension Amendment and Conversion Amendment proposals are
approved, Capitol will continue to attempt to consummate a business
combination until the Extended Date, and will retain the blank
check company restrictions previously applicable to it. The
warrants will remain outstanding in accordance with their terms.
The warrants will become exercisable upon the consummation of any
business combination following stockholder approval of the
proposals.
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Q.
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What do I need to do now?
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A. Capitol urges you to read carefully and
consider the information contained in this proxy statement,
including the annexes, and to consider how the proposals will
affect you as a Capitol stockholder. You should then vote as soon
as possible in accordance with the instructions provided in this
proxy statement and on the enclosed proxy card.
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Q.
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How do I vote?
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A. If you are a holder of record of Capitol
common stock, you may vote in person at the special meeting or by
submitting a proxy for the special meeting. Whether or not you plan
to attend the special meeting in person, we urge you to vote by
proxy to ensure your vote is counted. You may submit your proxy by
completing, signing, dating and returning the enclosed proxy card
in the accompanying pre-addressed postage paid envelope. You may
still attend the special meeting and vote in person if you have
already voted by proxy.
If your shares of Capitol common stock are held
in “street name” by a broker or other agent, you have
the right to direct your broker or other agent on how to vote the
shares in your account. You are also invited to attend the special
meeting. However, since you are not the stockholder of record, you
may not vote your shares in person at the special meeting unless
you request and obtain a valid proxy from your broker or other
agent.
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Q.
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How do I convert my shares of Capitol common
stock?
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A. If the Extension is implemented, each
public stockholder who votes in favor of the Conversion Amendment
may seek to convert his public shares for a pro rata portion of the
funds available in the trust account, less any income taxes owed on
such funds but not yet paid, calculated as if they had voted
against a business combination proposal. You will also be able to
convert your public shares in connection with any stockholder vote
to approve a proposed business combination, or if the Company has
not consummated a business combination by the Extended
Date.
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11
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To demand conversion, you must check the box on
the proxy card provided for that purpose and return the proxy card
in accordance with the instructions provided, and, at the same
time, ensure your bank or broker complies with the requirements
identified elsewhere herein. You will only be entitled to receive
cash in connection with a conversion of these shares if you
continue to hold them until the effective date of the Extension and
Conversion.
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In connection with tendering your shares for
conversion, you must elect either to physically tender your stock
certificates to Continental Stock Transfer & Trust Company, the
Company’s transfer agent, at Continental Stock Transfer &
Trust Company, 17 Battery Place, New York, New York 10004, Attn:
Mark Zimkind, mzimkind@continentalstock.com,
prior to the vote for the Extension Amendment and Conversion
Amendment or to deliver your shares to the transfer agent
electronically using The Depository Trust Company’s DWAC
(Deposit/Withdrawal At Custodian) System, which election would
likely be determined based on the manner in which you hold your
shares.
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Q.
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What should I do if I receive more than one set
of voting materials?
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A. You may
receive more than one set of voting materials, including multiple
copies of this proxy statement and multiple proxy cards or voting
instruction cards, if your shares are registered in more than one
name or are registered in different accounts. For example, if you
hold your shares in more than one brokerage account, you will
receive a separate voting instruction card for each brokerage
account in which you hold shares. Please complete, sign, date and
return each proxy card and voting instruction card that you receive
in order to cast a vote with respect to all of your Capitol
shares.
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Q.
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Who is paying for this proxy
solicitation?
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A. Capitol will pay for the entire cost of
soliciting proxies. In addition to these mailed proxy materials,
our directors and officers may also solicit proxies in person, by
telephone or by other means of communication. These parties will
not be paid any additional compensation for soliciting proxies. We
may also reimburse brokerage firms, banks and other agents for the
cost of forwarding proxy materials to beneficial owners.
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Q.
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Who can help answer my
questions?
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A. If you have questions about the
proposals or if you need additional copies of the proxy statement
or the enclosed proxy card you should contact:
Capitol Acquisition Corp. II
509 7th Street, N.W.
Washington, D.C. 20004
Attn: L. Dyson Dryden
Telephone: (202) 654-7060
You may also obtain additional information about
the Company from documents filed with the SEC by following the
instructions in the section entitled “Where You Can Find More
Information.”
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12
FORWARD-LOOKING
STATEMENTS
We believe that some of the information in this proxy statement
constitutes forward-looking statements. You can identify these
statements by forward-looking words such as “may,”
“expect,” “anticipate,”
“contemplate,” “believe,”
“estimate,” “intends,” and
“continue” or similar words. You should read statements
that contain these words carefully because they:
•
discuss future expectations;
•
contain projections of future results of operations or financial
condition; or
•
state other “forward-looking” information.
We believe it is important to communicate our expectations to our
stockholders. However, there may be events in the future that we
are not able to predict accurately or over which we have no
control. The cautionary language discussed in this proxy statement
provide examples of risks, uncertainties and events that may cause
actual results to differ materially from the expectations described
by us in such forward-looking statements, including, among other
things, claims by third parties against the trust account,
unanticipated delays in the distribution of the funds from the
trust account and Capitol’s ability to finance and consummate
the business combination with Lindblad following the distribution
of funds from the trust account. You are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date of this proxy statement.
All forward-looking statements included herein attributable to
Capitol or any person acting on Capitol’s behalf are
expressly qualified in their entirety by the cautionary statements
contained or referred to in this section. Except to the extent
required by applicable laws and regulations, Capitol undertakes no
obligation to update these forward-looking statements to reflect
events or circumstances after the date of this proxy statement or
to reflect the occurrence of unanticipated events.
13
BACKGROUND
Capitol
We are a Delaware company incorporated on August 9, 2010 for the
purpose of entering into a merger, share exchange, asset
acquisition, stock purchase, recapitalization, reorganization or
other similar business combination with one or more businesses or
entities.
On May 15, 2013, we consummated our IPO of 20,000,000 units,
including 2,000,000 units under the underwriters’
over-allotment option, with each unit consisting of one share of
common stock and one half of one warrant, each whole warrant to
purchase one share of common stock. The units were sold at an
offering price of $10.00 per unit, generating gross proceeds of
$200,000,000.
Prior to our IPO, our officers, directors and their affiliates
purchased an aggregate of 5,000,000 insider shares from us for an
aggregate of $25,000, and simultaneously with the consummation of
the IPO, the insiders purchased 5,600,000 warrants (the
“insider warrants”) for $5,600,000. The net proceeds of
the IPO plus the proceeds of the sale of the insider warrants were
deposited in the trust account. As of December 31, 2014, Capitol
had approximately $200,000,000 of cash in the trust account.
The mailing address of Capitol principal executive office is 509
7th Street, N.W., Washington, D.C. 20004, and its
telephone number is (202) 654-7060.
The Proposed Business
Combination with Lindblad
On March 9, 2015, Capitol entered into the Merger Agreement, by and
among Capitol, LLC Sub, Merger Sub and Lindblad. Pursuant to the
Merger Agreement, Merger Sub will be merged with and into Lindblad
to form the Interim Corporation as a direct wholly-owned subsidiary
of LLC Sub, and such Interim Corporation shall immediately
thereafter be merged with and into LLC Sub to form the Surviving
Company as a direct wholly-owned subsidiary of Capitol. The
Lindblad stockholders will receive an aggregate of (i) $90,000,000
in cash at the closing (a portion of which will be for transaction
bonuses) and (ii) 20,017,787 shares of Capitol common stock.
Capitol will also assume outstanding Lindblad stock options and
will issue options to purchase approximately 3,982,212 shares of
Capitol common stock to the Lindblad stock option holders.
You are not being asked
to vote on the proposed business combination with Lindblad at this
time. If the Extension is implemented and you do not elect to
convert your public shares, you will retain the right to vote on
the proposed business combination with Lindblad when it is
submitted to stockholders and the right to convert
your public shares into a pro rata portion of the trust account in
the event the proposed business combination is approved and
completed or the Company has not consummated a business combination
by the Extended Date.
14
THE EXTENSION AMENDMENT
AND CONVERSION AMENDMENT PROPOSALS
The Extension
Amendment
Capitol is proposing to amend its charter to extend the date by
which Capitol has to consummate a business combination to the
Extended Date.
The Extension Amendment and the Conversion Amendment are essential
to the overall implementation of the board of directors’ plan
to allow Capitol more time to complete a business combination.
Approval of the Extension Amendment and the Conversion Amendment is
a condition to the implementation of the Extension.
If the Extension Amendment proposal is not approved and we have not
consummated a business combination by May 15, 2015, we will (i)
cease all operations except for the purpose of winding up, (ii) as
promptly as reasonably possible but not more than ten business days
thereafter, redeem 100% of the outstanding public shares, at a
per-share price, payable in cash, equal to the aggregate amount
then on deposit in the trust account, including any interest but
net of franchise and income taxes payable, divided by the number of
then outstanding public shares, which redemption will completely
extinguish public stockholders’ rights as stockholders
(including the right to receive further liquidation distributions,
if any), subject to applicable law, and (iii) as promptly as
reasonably possible following such redemption, subject to the
approval of our remaining stockholders and our board of directors,
dissolve and liquidate, subject (in the case of (ii) and (iii)
above) to our obligations under Delaware law to provide for claims
of creditors and the requirements of other applicable law.
The board of directors believes that decisions regarding
Capitol’s future, such as whether to continue its existence
or have its existence terminate, should be determined by
Capitol’s current stockholders and they should not be bound
by the restrictions implemented by the stockholders at the time of
the IPO. The current stockholders should not be prohibited from
amending the charter to allow Capitol to continue its existence,
especially since all holders of public shares are being offered the
opportunity to convert their public shares and receive their pro
rata portion of the trust account in connection with the approval
of the proposals which will occur close in time to May 15, 2015 as
contemplated in the IPO prospectus. Additionally, given
Capitol’s expenditure of time, effort and money on the
proposed business combination with Lindblad, circumstances warrant
providing public stockholders an opportunity to consider the
proposed business combination with Lindblad.
A copy of the proposed amendment to the charter of Capitol is
attached to this proxy statement as Annex A.
Conversion Amendment
Proposal
The Conversion Amendment proposal allows the holders of public
shares to elect to convert their public shares into their pro rata
portion of the funds held in the trust account if the Extension
Amendment is approved. The Conversion Amendment proposal will not
be presented unless the Extension Amendment is approved. Approval
of the Extension Amendment and the Conversion Amendment is a
condition to the implementation of the Extension. We will not
proceed with the Extension if we do not have at least $5,000,001 of
net tangible assets following approval of the Extension Amendment
and Conversion Amendment proposals, after taking into account the
Conversion.
All holders of Capitol’s public shares who vote in favor of
the Conversion Amendment, whether they vote for or against the
Extension Amendment, are entitled to convert all or a portion of
their public shares into their pro rata portion of the trust
account, provided that the Extension is implemented. Voting in
favor of the Conversion Amendment does not require you to convert
your public shares. You must, however, vote in favor of the
Conversion Amendment in order to convert your public shares.
A public stockholder’s election to convert shall constitute
consent for Capitol to remove the Withdrawal Amount from the trust
account relating to converted public shares, deliver to the holders
of such shares so tendered such pro rata portion of the trust
account and leave the remainder of the funds in the trust account
until the earlier to occur of (y) the completion of a business
combination or (z) the Extended Date. Capitol estimates that the
per share pro rata portion of the trust account will be
approximately $10.00 at the time of the special meeting. The
closing price of Capitol’s common stock on April 22, 2015 was
$11.31. Accordingly, if the market price were to remain the same
until the date of the meeting, exercising conversion rights would
result in a public stockholder receiving $1.31 less than if he sold
his stock in the open market. Capitol cannot assure stockholders
that they will be able to sell their
15
shares of Capitol common stock in the open market, even if the
market price per share is higher than the conversion price stated
above, as there may not be sufficient liquidity in its securities
when such stockholders wish to sell their shares.
At the time the Extension Amendment becomes effective, Capitol will
also amend the trust account agreement to (i) permit the withdrawal
of the Withdrawal Amount from the trust account and (ii) extend the
date on which to liquidate the trust account to the Extended
Date.
A copy of the proposed amendment to the charter of Capitol is
attached to this proxy statement as Annex A.
Reasons for the
Proposals
Capitol’s IPO prospectus and charter provided that Capitol
had until February 15, 2015 to complete a business combination,
unless it had executed a letter of intent by such date, in which
case it had until May 15, 2015 to consummate such a business
combination. Capitol executed a letter of intent with Lindblad on
January 7, 2015 and subsequently executed the merger agreement on
March 9, 2015, leaving approximately two months to complete the
business combination. Capitol’s IPO prospectus and charter
stated that Capitol would not take any action to amend or waive
these provisions (except in connection with, and to be effective
upon, a business combination) to allow it to survive for a longer
period of time if it did not appear it would be able to consummate
a business combination by May 15, 2015. Notwithstanding the
foregoing, because Capitol believes the proposed business
combination with Lindblad to be in the best interests of
Capitol’s stockholders, and because Capitol may not be able
to complete the proposed business combination by May 15, 2015,
Capitol has determined to seek stockholder approval to extend the
time for closing a business combination beyond May 15, 2015 to the
Extended Date. Capitol has filed a preliminary proxy statement
relating to the proposed business combination and, if the Extension
Amendment and Conversion Amendment are approved, expects to seek
stockholder approval of such business combination once the SEC
completes its review of such preliminary proxy statement.
We believe that the foregoing charter provisions were included to
protect Capitol stockholders from having to sustain their
investments for an unreasonably long period if Capitol failed to
find a suitable business combination in the timeframe contemplated
by the charter, and the application of those investments without
the stockholder review customarily provided for them. We also
believe, however, that given Capitol’s expenditure of time,
effort and money on the potential business combination with
Lindblad, circumstances warrant providing those who believe they
might find the potential business combination to be an attractive
investment with an opportunity to consider such a transaction,
inasmuch as Capitol is also affording stockholders who wish to
convert their public shares as originally contemplated, the
opportunity to do so as well. Accordingly, we believe that the
Extension Amendment and Conversion Amendment proposals are
consistent with the spirit in which Capitol offered its securities
to the public.
If the Extension Amendment or Conversion Amendment Proposals Are
Not Approved
If the Extension Amendment or Conversion Amendment are not approved
and we have not consummated a business combination by May 15, 2015,
we will (i) cease all operations except for the purpose of winding
up, (ii) as promptly as reasonably possible but not more than ten
business days thereafter, redeem 100% of the outstanding public
shares, at a per-share price, payable in cash, equal to the
aggregate amount then on deposit in the trust account, including
any interest but net of franchise and income taxes payable, divided
by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as
stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject
to the approval of our remaining stockholders and our board of
directors, dissolve and liquidate, subject (in the case of (ii) and
(iii) above) to our obligations under Delaware law to provide for
claims of creditors and the requirements of other applicable
law.
Capitol’s initial stockholders have waived their rights to
participate in any liquidation distribution with respect to their
initial shares. There will be no distribution from the trust
account with respect to Capitol’s warrants which will expire
worthless in the event we wind up. Capitol will pay the costs of
liquidation from its remaining assets outside of the trust account.
If such funds are insufficient, Capitol’s executive officers
have agreed to advance it the funds necessary to complete such
liquidation (currently anticipated to be no more than approximately
$15,000) and have agreed not to seek repayment of such
expenses.
16
If the Extension Amendment is not approved, the holders of the
public shares will not vote on the Conversion Amendment, and the
trust account will be liquidated as described above. If the
Conversion Amendment is not approved, the Company will not effect
the Extension.
If the Extension Amendment and the Conversion Amendment Are
Approved
If the Extension Amendment and the Conversion Amendment are
approved, Capitol will file an amendment to the charter with the
Secretary of State of the State of Delaware in the form of
Annex A hereto
to extend the time it has to complete a business combination until
the Extended Date. Capitol will remain a reporting company under
the Securities Exchange Act of 1934 and its units, common stock and
warrants will remain publicly traded. Capitol will then continue to
work to consummate a business combination by the Extended Date.
You are not being asked
to vote on the proposed business combination with Lindblad at this
time. If the Extension is implemented and you do not elect to
convert your public shares, you will retain the right to vote on
the proposed business combination with Lindblad when it is
submitted to stockholders and the right to convert
your public shares into a pro rata portion of the trust account in
the event the proposed business combination is approved and
completed or the Company has not consummated a business combination
by the Extended Date.
If the Extension Amendment and Conversion Amendment proposals are
approved, and the Extension is implemented, the removal of the
Withdrawal Amount from the trust account in connection with the
Conversion will reduce the amount held in the trust account and
Capitol’s net asset value. Capitol cannot predict the amount
that will remain in the trust account if the Extension Amendment
and Conversion Amendment proposals are approved, and the amount
remaining in the trust account may be only a small fraction of the
approximately $200 million that was in the trust account as of
December 31, 2014. However, we will not proceed if we do not have
at least $5,000,001 of net tangible assets following approval of
the Extension Amendment and Conversion Amendment proposals.
Conversion
Rights
If the Extension Amendment and Conversion Amendment proposals are
approved, and the Extension is implemented, each public stockholder
who votes in favor of the Conversion Amendment may seek to convert
his public shares for a pro rata portion of the funds available in
the trust account, less any income taxes owed on such funds but not
yet paid, calculated as if they had voted against a business
combination proposal. You will also be able to convert your public
shares in connection with any stockholder vote to approve a
proposed business combination, or if the Company has not
consummated a business combination by the Extended Date.
17
To demand conversion, you must check
the box on the proxy card provided for that purpose and return the
proxy card in accordance with the instructions provided, and, at
the same time, ensure your bank or broker complies with the
requirements identified elsewhere herein, including delivering your
shares to the transfer agent prior to the vote on the Extension
Amendment and Conversion Amendment. You will only be entitled to
receive cash in connection with a conversion of these shares if you
continue to hold them until the effective date of the Extension
Amendment and Conversion.
In connection with tendering your shares for conversion, you must
elect either to physically tender your stock certificates to
Continental Stock Transfer & Trust Company, the Company’s
transfer agent, at Continental Stock Transfer & Trust Company,
17 Battery Place, New York, New York 10004, Attn: Mark Zimkind,
mzimkind@continentalstock.com, prior to the vote for the Extension
Amendment and Conversion Amendment or to deliver your shares to the
transfer agent electronically using The Depository Trust
Company’s DWAC (Deposit/Withdrawal At Custodian) System,
which election would likely be determined based on the manner in
which you hold your shares. The requirement for physical or
electronic delivery prior to the vote at the special meeting
ensures that a converting holder’s election is irrevocable
once the Extension Amendment and the Conversion Amendment are
approved. In furtherance of such irrevocable election, stockholders
making the election will not be able to tender their shares after
the vote at the special meeting.
Through the DWAC system, this electronic delivery process can be
accomplished by the stockholder, whether or not it is a record
holder or its shares are held in “street name,” by
contacting the transfer agent or its broker and requesting delivery
of its shares through the DWAC system. Delivering shares physically
may take significantly longer. In order to obtain a physical stock
certificate, a stockholder’s broker and/or clearing broker,
DTC, and the Company’s transfer agent will need to act
together to facilitate this request. There is a nominal cost
associated with the above-referenced tendering process and the act
of certificating the shares or delivering them through the DWAC
system. The transfer agent will typically charge the tendering
broker $45 and the broker would determine whether or not to pass
this cost on to the redeeming holder. It is the Company’s
understanding that stockholders should generally allot at least two
weeks to obtain physical certificates from the transfer agent. The
Company does not have any control over this process or over the
brokers or DTC, and it may take longer than two weeks to obtain a
physical stock certificate. Such stockholders will have less time
to make their investment decision than those stockholders that
deliver their shares through the DWAC system. Stockholders who
request physical stock certificates and wish to convert may be
unable to meet the deadline for tendering their shares before
exercising their conversion rights and thus will be unable to
convert their shares.
Certificates that have not been tendered in accordance with these
procedures prior to the vote for the Extension Amendment and
Conversion Amendment will not be converted into a pro rata portion
of the funds held in the trust account. In the event that a public
stockholder tenders its shares and decides prior to the vote at the
special meeting that it does not want to convert its shares, the
stockholder may withdraw the tender. If you delivered your shares
for conversion to our transfer agent and decide prior to the vote
at the special meeting not to convert your shares, you may request
that our transfer agent return the shares (physically or
electronically). You may make such request by contacting our
transfer agent at address listed above. In the event that a public
stockholder tenders shares and the Extension Amendment and the
Conversion Amendment are not approved or is abandoned, these shares
will not be converted and the physical certificates representing
these shares will be returned to the stockholder promptly following
the determination that the Extension Amendment and the Conversion
Amendment will not be approved or will be abandoned. The Company
anticipates that a public stockholder who tenders shares for
conversion in connection with the vote to approve the Extension
Amendment and the Conversion Amendment would receive payment of the
conversion price for such shares soon after the completion of the
Extension Amendment. The transfer agent will hold the certificates
of public stockholders that make the election until such shares are
converted for cash or returned to such stockholders.
If properly demanded, the Company will convert each public share
for a pro rata portion of the funds available in the trust account,
less any income taxes owed on such funds but not yet paid,
calculated as of two days prior to the filing of the amendment to
the charter. As of the record date, this would amount to
approximately $10.00 per share. The closing price of
Capitol’s common stock on April 22, 2015 was $11.31.
Accordingly, if the market price were to remain the same until the
date of the meeting, exercising conversion rights would result in a
public stockholder receiving $1.31 less than if he sold his stock
in the open market.
18
If you exercise your conversion rights, you will be exchanging your
shares of the Company’s common stock for cash and will no
longer own the shares. You will be entitled to receive cash for
these shares only if you vote for the Conversion Amendment,
properly demand conversion, and tender your stock certificate(s) to
the Company’s transfer agent prior to the vote for the
Extension Amendment and Conversion Amendment. If the Extension
Amendment and the Conversion Amendment are not approved or if they
are abandoned, these shares will be redeemed in accordance with the
terms of the charter promptly following the meeting as described
elsewhere herein.
The Special
Meeting
Date, Time and
Place. The special meeting of Capitol’s
stockholders will be held at 11:00 a.m., EDT on May 14, 2015, at
the offices of Capitol’s counsel, Graubard Miller, at 405
Lexington Avenue, New York, NY 10174.
Voting Power; Record
Date. You will be entitled to vote or direct votes to
be cast at the special meeting, if you owned Capitol common stock
at the close of business on April 22, 2015, the record date for the
special meeting. You will have one vote per proposal for each
Capitol common share you owned at that time. Capitol warrants do
not carry voting rights.
Votes
Required. Approval of the Extension Amendment and
Conversion Amendment proposals will require the affirmative vote of
holders of a majority of Capitol’s common stock outstanding
on the record date. If you do not vote (i.e., you
“abstain” from voting on a proposal), your action will
have the same effect as an “AGAINST” vote. Broker
non-votes will have the same effect as “AGAINST”
votes.
At the close of business on the record date, there were 25,000,000
outstanding shares of Capitol common stock each of which entitles
its holder to cast one vote per proposal.
If you do not want the Extension Amendment approved, you must
abstain, not vote, or vote against the Extension Amendment. If you
want to obtain your pro rata portion of the trust account in the
event the Extension is implemented, which will be paid shortly
after the stockholder meeting which is scheduled for May 14, 2015,
you must vote for the Conversion Amendment and demand conversion of
your shares. Holders of public shares who vote against the
Conversion Amendment may not convert their public shares.
Proxies; Board
Solicitation. Your proxy is being solicited by the
Capitol board of directors on the proposal to approve the Extension
Amendment and the Conversion Amendment being presented to
stockholders at the special meeting. No recommendation is being
made as to whether you should elect to convert your shares. Proxies
may be solicited in person or by telephone. If you grant a proxy,
you may still revoke your proxy and vote your shares in person at
the special meeting.
Possible Claims Against
and Impairment of the Trust Account
You should be aware that because Capitol’s IPO prospectus
stated that Capitol would not take any action allowing it to
survive for a longer period of time except in connection with, and
effective upon, the consummation of a business combination, as
required by its charter, you may have securities law claims against
Capitol for rescission (under which a successful claimant has the
right to receive the total amount paid for his or her shares
pursuant to an allegedly deficient prospectus, plus interest and
less any income earned on the shares, in exchange for surrender of
the shares) or damages (compensation for loss on an investment
caused by alleged material misrepresentations or omissions in the
sale of the security). Rescission and damages claims would not
necessarily be finally adjudicated by the time the trust account is
liquidated. Such claims may entitle public stockholders asserting
them to more than the pro rata share of the trust account to which
they are entitled upon conversion or liquidation, as well as
punitive damages.
In general under U.S. federal and state securities laws, material
misstatements and omissions in a prospectus may give rise to rights
of rescission in favor of, or claims for damages by, persons who
purchased securities pursuant to the prospectus. As a result, it is
possible that adopting the Extension Amendment may result in claims
being made against Capitol whose holders might seek to have the
claims satisfied from funds in the trust account. Capitol has not
made or requested of its advisors a formal comprehensive analysis
of its potential liability for any such misstatements or omissions.
Since rescission generally provides successful claimants with the
right to recover the entire purchase price of their securities,
holders of Capitol common stock who successfully claim rescission
could be awarded up to approximately $10.00 per share, based on the
initial offering price of the units issued in Capitol’s IPO,
which were comprised of stock and warrants, less any amount
received from the sale of the original warrants
19
included in the units, plus interest from the date of
Capitol’s IPO. In general, a person who purchased shares
pursuant to a defective prospectus or other representation must
make a claim for rescission within the applicable statute of
limitations period, which, for claims made under federal law and
some state statutes, is one year from the time the claimant
discovered or reasonably should have discovered the facts giving
rise to the claim but not more than three years from the occurrence
of the event giving rise to the claim. A successful claimant for
damages under federal or state law could be awarded an amount to
compensate for the decrease in value of his or her shares caused by
the alleged violation (including, possibly, punitive damages),
together with interest, while retaining the shares. Claims under
the anti-fraud provisions of the federal securities laws must
generally be brought within two years of discovery, but not more
than five years after occurrence. Rescission and damages claims
would not necessarily be finally adjudicated by the time the trust
account is liquidated, and such claims would not be extinguished by
consummation of that transaction.
If Capitol were to become subject to such claims as a result of the
Extension Amendment, Capitol’s assets following the Extension
Amendment could be significantly reduced or depleted entirely and
the trust account could be depleted by those claims to the extent
of any judgments arising from such claims, together with any
expenses related to defending such claims if the resources of
Capitol’s executive officers, who have certain
indemnification obligations with respect to the trust account, are
insufficient or unavailable to indemnify Capitol for the full
amount. A consequence might be that the amount being held in the
trust account is diminished and holders of public shares who do not
convert their public shares now may receive a lesser amount as
their pro rata portion of the trust account. Moreover, attendant
litigation could result in delay in payments to public stockholders
of trust account funds on liquidation.
If Capitol’s trust account is not depleted by liabilities for
securities law claims or other expenses, Capitol estimates that all
public stockholders would receive, upon liquidation, approximately
$10.00 per share (calculated as of the record date). This per share
amount may be less than the possible per-share amount of a
successful rescission claim as a rescission award may bear interest
at a higher rate than that earned on trust account funds. Public
stockholders would also incur costs in prosecuting such claims,
which would reduce the per-share amount they realize.
Capitol has attempted to structure the Extension Amendment and the
Conversion Amendment to preserve the investment proposition set
forth in the IPO prospectus for public stockholders, specifically,
by giving them their right to convert on the date of the
stockholder meeting, which is scheduled for May 14, 2015 and
receive their pro rata portion of the trust account shortly
thereafter. This is designed to limit the potential damages, but it
is impossible to predict how courts would rule in such a case. A
further deterrent to the bringing of a rescission claim is the
significant costs that stockholders would incur in prosecuting
those claims.
In view of the foregoing, Capitol’s board of directors
believes it in the best interests of Capitol’s stockholders
to approve the Extension Amendment and the Conversion
Amendment.
Required Vote
The affirmative vote by holders of a majority of Capitol’s
outstanding common stock voting for the Extension Amendment and the
Conversion Amendment is required to approve the Extension Amendment
and the Conversion Amendment. Capitol’s board of directors
will abandon the Conversion Amendment if the Extension Amendment is
not approved. In that case, Capitol will be required by its charter
to (i) cease all operations except for the purpose of winding up,
(ii) as promptly as reasonably possible but not more than ten
business days thereafter, redeem 100% of the outstanding public
shares, at a per-share price, payable in cash, equal to the
aggregate amount then on deposit in the trust account, including
any interest but net of franchise and income taxes payable, divided
by the number of then outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as
stockholders (including the right to receive further liquidation
distributions, if any), subject to applicable law, and (iii) as
promptly as reasonably possible following such redemption, subject
to the approval of our remaining stockholders and our board of
directors, dissolve and liquidate, subject (in the case of (ii) and
(iii) above) to our obligations under Delaware law to provide for
claims of creditors and the requirements of other applicable
law.
All of Capitol’s directors, executive officers and their
affiliates are expected to vote any common stock owned by them in
favor of the Extension Amendment and the Conversion Amendment. On
the record date, directors and executive officers of Capitol and
their affiliates beneficially owned and were entitled to vote
5,000,000 shares of Capitol common stock representing approximately
20.0% of Capitol’s issued and outstanding common stock.
20
In addition, Capitol’s directors, executive officers and
their affiliates may choose to buy shares of Capitol public common
stock in the open market and/or through negotiated private
purchases. In the event that purchases do occur, the purchasers may
seek to purchase shares from stockholders who would otherwise have
voted against the Extension Amendment and Conversion Amendment
proposals and elected to convert their shares into a portion of the
trust account. Any shares of Capitol public common stock purchased
by affiliates will be voted in favor of the Extension Amendment and
Conversion Amendment proposals.
Interests of
Capitol’s Directors and Officers
When you consider the recommendation of the Capitol board of
directors, you should keep in mind that Capitol’s executive
officers and members of Capitol’s board of directors have
interests that may be different from, or in addition to, your
interests as a stockholder. These interests include, among other
things:
•
If the Extension Amendment is
not approved and we do not consummate a business combination by May
15, 2015 as contemplated by our IPO prospectus and in accordance
with our charter, the 5,000,000 shares of common stock held by
Capitol officers, directors and affiliates and their permitted
transferees, which were acquired prior to the IPO for an aggregate
purchase price of $25,000, will be worthless (as the holders have
waived liquidation rights with respect to such shares), as will the
5,600,000 warrants that were acquired simultaneously with the IPO
for an aggregate purchase price of $5,600,000 (as they will
expire). Such common stock and warrants had an aggregate market
value of approximately $68,590,000 based on the last sale price of
$11.31 and $2.15, respectively, on Nasdaq on April 22,
2015;
•
In connection with the IPO, Capitol’s executive officers have
agreed that they will be liable under certain circumstances to
ensure that the proceeds in the trust account are not reduced by
the claims of target businesses or vendors or other entities that
are owed money by the Company for services rendered, contracted for
or products sold to the Company;
•
All rights specified in Capitol’s charter relating to the
right of officers and directors to be indemnified by Capitol, and
of Capitol’s officers and directors to be exculpated from
monetary liability with respect to prior acts or omissions, will
continue after a business combination. If the business combination
is not approved and Capitol liquidates, Capitol will not be able to
perform its obligations to its officers and directors under those
provisions;
•
None of Capitol’s executive officers or directors has
received any cash compensation for services rendered to Capitol.
All of the current members of Capitol’s board of directors
are expected to continue to serve as directors at least through the
date of the special meeting and may continue to serve following any
potential business combination and receive compensation
thereafter;
•
Capitol’s initial stockholders have loaned Capitol an
aggregate of approximately $1,460,000. The loans are non-interest
bearing and are payable at the consummation of a business
combination. Furthermore, the initial stockholders or their
affiliates may loan additional funds to Capitol in the future on
substantially similar terms in order to meet Capitol’s
working capital needs prior to the closing of the mergers. If
Capitol fails to consummate a business combination, the loans would
become unsecured liabilities of Capitol; however, the lenders have
waived any claim against the trust account. Accordingly, Capitol
will most likely not be able to repay these loans if the mergers
are not completed; and
•
Capitol’s officers, directors, initial stockholders and their
affiliates are entitled to reimbursement of out-of-pocket expenses
incurred by them in connection with certain activities on
Capitol’s behalf, such as identifying and investigating
possible business targets and business combinations. These
individuals have negotiated the repayment of any such expenses upon
completion of the business combination with Lindblad. However, if
Capitol fails to obtain the Extension and consummate the business
combination, they will not have any claim against the trust account
for reimbursement. Accordingly, Capitol will most likely not be
able to reimburse these expenses if the mergers are not completed.
Although as of the record date, Capitol’s officers,
directors, initial stockholders and their affiliates had not
incurred any unpaid reimbursable expenses, they may incur such
expenses in the future.
21
The Board’s
Reasons for the Extension Amendment and Conversion Amendment
Proposals and Its Recommendation
As discussed below, after careful consideration of all relevant
factors, Capitol’s board of directors has determined that the
Extension Amendment and Conversion Amendment proposals are fair to,
and in the best interests of, Capitol and its stockholders. The
board of directors has approved and declared advisable adoption of
the Extension Amendment and Conversion Amendment proposals, and
recommends that you vote “FOR” such adoption. The board
expresses no opinion as to whether you should convert your public
shares.
We are a Delaware company incorporated on August 9, 2010 for the
purpose of entering into a merger, share exchange, asset
acquisition, stock purchase, recapitalization, reorganization or
other similar business combination with one or more businesses or
entities. On May 15, 2013, we consummated our IPO of 20,000,000
units, including 2,000,000 units under the underwriters’
over-allotment option, with each unit consisting of one share of
common stock and one half of one warrant, each whole warrant to
purchase one share of common stock. The units were sold at an
offering price of $10.00 per unit, generating gross proceeds of
$200,000,000.
Capitol’s IPO prospectus and charter provided that Capitol
had until February 15, 2015 to complete a business combination,
unless it had executed a letter of intent by such date, in which
case it had until May 15, 2015 to consummate such a business
combination. Capitol executed a letter of intent with Lindblad on
January 7, 2015 and subsequently executed the merger agreement on
March 9, 2015, leaving approximately two months to complete the
business combination. Capitol’s IPO prospectus and charter
stated that Capitol would not take any action to amend or waive
these provisions (except in connection with, and to be effective
upon, a business combination) to allow it to survive for a longer
period of time if it did not appear it would be able to consummate
a business combination by May 15, 2015. Notwithstanding the
foregoing, because Capitol believes the proposed business
combination with Lindblad to be in the best interests of
Capitol’s stockholders, and because Capitol may not be able
to complete the proposed business combination by May 15, 2015,
Capitol has determined to seek stockholder approval to extend the
time for closing a business combination beyond May 15, 2015 to the
Extended Date. Capitol has filed a preliminary proxy statement
relating to the proposed business combination and, if the Extension
Amendment and Conversion Amendment are approved, expects to seek
stockholder approval of such business combination once the SEC
completes its review of such preliminary proxy statement.
Capitol is not asking you to vote on any proposed business
combination at this time. If you vote in favor of the Extension
Amendment and do not elect to convert your public shares, you will
retain the right to vote on any proposed business combination in
the future and the right to convert your public shares into a pro
rata portion of the trust account in the event the proposed
business combination is approved and completed or the Company has
not consummated a business combination by the Extended Date.
Capitol’s charter purports to prohibit amendment to certain
of its provisions, including any amendment that would extend its
corporate existence beyond the above date, except in connection
with, and effective upon consummation of, a business combination.
We believe that these charter provisions were included to protect
Capitol stockholders from having to sustain their investments for
an unreasonably long period, if Capitol failed to find a suitable
business combination in the timeframe contemplated by the charter,
and the application of those investments without the stockholder
review customarily provided for them. We also believe, however,
that given Capitol’s expenditure of time, effort and money on
the potential business combination with Lindblad, circumstances
warrant providing those who believe they might find the potential
business combination to be an attractive investment with an
opportunity to consider such a transaction, inasmuch as Capitol is
also affording stockholders who wish to convert their public shares
as originally contemplated, the opportunity to do so as well.
Accordingly, we believe that the Extension Amendment and Conversion
Amendment proposals are consistent with the spirit in which Capitol
offered its securities to the public.
After careful consideration of all relevant factors,
Capitol’s board of directors determined that the Extension
Amendment and Conversion Amendment are fair to and in the best
interests of Capitol and its stockholders.
The Board of Directors
recommends that you vote “FOR” the Extension Amendment
and Conversion Amendment proposals. The Board of Directors
expresses no opinion as to whether you should convert your public
shares.
22
BENEFICIAL OWNERSHIP OF
SECURITIES
The following table sets forth certain information regarding the
beneficial ownership of Capitol’s common stock as of the
record date by:
•
each person known by us to be the beneficial owner of more than 5%
of our outstanding shares of common stock;
•
each of our officers, directors and senior advisors; and
•
all our officers and directors as a group.
As of the record date, there were a total of 25,000,000 shares of
common stock (including 20,000,000 public shares). Unless otherwise
indicated, all persons named in the table have sole voting and
investment power with respect to all shares of common stock
beneficially owned by them.
Name and Address of Beneficial
Owner(1)
|
|
Amount and Nature of Beneficial Ownership
|
|
Approximate Percentage of Outstanding Shares of Common
Stock
|
Mark D. Ein
|
|
3,736,667
|
(2)
|
|
14.9
|
%
|
L. Dyson Dryden
|
|
1,130,001
|
(3)
|
|
4.5
|
%
|
Lawrence Calcano
|
|
44,444
|
(4)
|
|
|
*
|
Richard C. Donaldson
|
|
44,444
|
(4)
|
|
|
*
|
Piyush Sodha
|
|
44,444
|
(4)
|
|
|
*
|
Capitol Acquisition Management 2 LLC
|
|
3,736,667
|
(5)
|
|
14.9
|
%
|
T. Rowe Price Associates, Inc.
|
|
1,799,790
|
(6)
|
|
7.2
|
%
|
Fir Tree Inc.
|
|
1,782,000
|
(7)
|
|
7.1
|
%
|
BlueMountain Capital Management, LLC
|
|
1,250,772
|
(8)
|
|
5.0
|
%
|
AQR Capital Management, LLC
|
|
1,781,900
|
(9)
|
|
7.1
|
%
|
TD Asset Management Inc.
|
|
1,250,000
|
(10)
|
|
5.0
|
%
|
All directors and executive officers as a group
(five individuals)
|
|
5,000,000
|
(11)
|
|
20.0
|
%
|
23
All of the 5,000,000 shares of our outstanding common stock owned
by our initial stockholders prior to our IPO have been placed in
escrow with Continental Stock Transfer & Trust Company, as
escrow agent, pursuant to an escrow agreement.
STOCKHOLDER
PROPOSALS
If the Extension Amendment and Conversion Amendment proposals are
approved, Capitol’s 2016 annual meeting of stockholders will
likely be held on or about June 29, 2016, unless the date is
changed by the Capitol’s board of directors. If you are a
stockholder and you want to include a proposal in the proxy
statement for the year 2016 annual meeting, you need to provide it
to Capitol by no later than approximately January 31, 2016. You
should direct any proposals to Capitol’s secretary at
Capitol’s principal office. If you are a stockholder and you
want to present a matter of business to be considered or nominate a
director to be elected at the year 2016 annual meeting, under
Capitol’s bylaws you must give timely notice of the matter or
the nomination, in writing, to Capitol’s secretary. To be
timely, the notice has to be given between 60 and 90 days before
the annual meeting date (or between March 31, 2016 and April 30,
2016, if the 2016 annual meeting is held on June 29, 2016).
If the Extension Amendment and Conversion Amendment proposals are
not approved, there will be no annual meeting in 2016.
DELIVERY OF DOCUMENTS TO
STOCKHOLDERS
Pursuant to the rules of the SEC, Capitol and its agents that
deliver communications to its stockholders are permitted to deliver
to two or more stockholders sharing the same address a single copy
of Capitol’s proxy statement. Upon written or oral request,
Capitol will deliver a separate copy of the proxy statement to any
stockholder at a shared address who wishes to receive separate
copies of such documents in the future. Stockholders receiving
multiple copies of such documents may likewise request that Capitol
deliver single copies of such documents in the future. Stockholders
may notify Capitol of their requests by calling or writing Capitol
at Capitol’s principal executive offices at 509
7th Street, N.W., Washington, D.C. 20004.
WHERE YOU CAN FIND MORE
INFORMATION
Capitol files reports, proxy statements and other information with
the SEC as required by the Securities Exchange Act of 1934, as
amended. You may read and copy reports, proxy statements and other
information filed by Capitol with the SEC at its public reference
room located at 100 F Street, N.E., Washington, D.C. 20549-1004.
You may obtain information on the operation of the Public Reference
Room by calling the SEC at 1-800-SEC-0330. You may also obtain
copies of the materials described above at prescribed rates by
writing to the SEC, Public Reference Section, 100 F Street, N.E.,
Washington, D.C. 20549-1004. Capitol files its reports, proxy
statements and other information electronically with the SEC. You
may access information on Capitol at the SEC website containing
reports, proxy statements and other information at http://www.sec.gov.
This proxy statement describes the material elements of relevant
contracts, exhibits and other information attached as annexes to
this proxy statement. Information and statements contained in this
proxy statement are qualified in all respects by reference to the
copy of the relevant contract or other document included as an
annex to this document.
This proxy statement contains important business and financial
information about us that is not included in or delivered with this
document. You may obtain this additional information, or additional
copies of this proxy
24
statement, at no cost, and you may ask any questions you may have
about the Extension Amendment or the Conversion Amendment by
contacting us at the following address, telephone number or
facsimile number:
Capitol Acquisition Corp. II
509 7th Street, N.W.
Washington, D.C. 20004
Tel: (202) 654-7060
Fax: (202) 654-7070
In order to receive timely delivery of the documents in advance of
the special meeting, you must make your request for information no
later than May 8, 2015.
25
ANNEX A
PROPOSED AMENDMENT
TO THE
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
CAPITOL ACQUISITION CORP. II
________________________
Pursuant to Section 245
of the
Delaware General
Corporation Law
________________________
The undersigned, being a duly authorized officer of CAPITOL
ACQUISITION CORP. II (the “Corporation”), a
corporation existing under the laws of the State of Delaware, does
hereby certify as follows:
1. The
name of the Corporation is Capitol Acquisition Corp. II.
2. The
Corporation’s Certificate of Incorporation was filed in the
office of the Secretary of State of the State of Delaware on August
9, 2010, and an Amended and Restated Certificate of Incorporation
was filed in the office of the Secretary of State of the State of
Delaware on May 10, 2013.
3.
This Amendment to the Amended and Restated Certificate of
Incorporation amends the Amended and Restated Certificate of
Incorporation of the Corporation.
4.
This Amendment to the Amended and Restated Certificate of
Incorporation was duly adopted by the affirmative vote of the
holders of a majority of the stock entitled to vote at a meeting of
stockholders in accordance with the provisions of Sections 242 and
245 the General Corporation Law of the State of Delaware (the
“GCL”).
5.
The text of Paragraph (f) of
ARTICLE SIXTH is hereby amended and restated to read in full as
follows:
In the event that the Corporation does not consummate a Business
Combination by July 31, 2015 (such date being referred to as the
“Termination Date”), the Corporation shall (i) cease
all operations except for the purposes of winding up, (ii) as
promptly as reasonably possible but not more than ten (10) business
days thereafter, redeem 100% of the IPO Shares for cash for a
redemption price per share equal to the amount then held in the
Trust Account, including the interest earned thereon, less any
income or franchise taxes payable, divided by the total number of
IPO Shares then outstanding (which redemption will completely
extinguish such holders’ rights as stockholders, including
the right to receive further liquidation distributions, if any),
subject to applicable law, and (iii) as promptly as reasonably
possible following such redemption, subject to approval of the
Corporation’s then stockholders and subject to the
requirements of the GCL, including the adoption of a resolution by
the Board pursuant to Section 275(a) of the GCL finding the
dissolution of the Corporation advisable and the provision of such
notices as are required by said Section 275(a) of the GCL, dissolve
and liquidate the balance of the Corporation’s net assets to
its remaining stockholders, as part of the Corporation’s plan
of dissolution and liquidation, subject (in the case of clauses
(ii) and (iii) above) to the Corporation’s obligations under
the GCL to provide for claims of creditors and other requirements
of applicable law.
5.
The text of Paragraph (g) of
ARTICLE SIXTH is hereby amended and restated to read in full as
follows:
A holder of IPO Shares shall be entitled only to receive
distributions from the Trust Account in the event (i) such holder
demands conversion of its shares in accordance with paragraph D
above in connection with any Proxy Solicitation, (ii) such holder
demands conversion of its shares in accordance with an amendment of
this Certificate of Incorporation providing for dissenting
holders
Annex A-1
of IPO Shares to demand conversion of such shares prior to the
Termination Date or (iii) that the Corporation has not consummated
a Business Combination by the Termination Date. In no other
circumstances shall a holder of IPO Shares have any right or
interest of any kind in or to the Trust Account.
IN WITNESS WHEREOF, I have signed this Amendment to the Amended and
Restated Certificate of Incorporation this 14th day of
May, 2015.
Name: ______________________
Title: _______________________
Annex-2
PROXY
Capitol Acquisition
Corp. II
509
7th Street, N.W.
Washington, D.C. 20004
SPECIAL MEETING OF
STOCKHOLDERS
MAY 14, 2015
YOUR VOTE IS IMPORTANT
FOLD AND DETACH
HERE
CAPITOL ACQUISITION CORP. II
THIS PROXY IS SOLICITED
BY THE BOARD OF DIRECTORS
FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD ON
MAY 14, 2015
The undersigned, revoking any previous proxies relating to these
shares, hereby acknowledges receipt of the Notice and Proxy
Statement, dated May 4, 2015, in connection with the Special
Meeting to be held at 11:00 a.m. EDT on May 14, 2015 at the offices
of Graubard Miller, 405 Lexington Avenue, New York, NY 10174, and
hereby appoints Mark D. Ein and L. Dyson Dryden, and each of them
(with full power to act alone), the attorneys and proxies of the
undersigned, with power of substitution to each, to vote all shares
of the common stock, of Capitol Acquisition Corp. II (the
“Corporation”) registered in the name provided, which
the undersigned is entitled to vote at the Special Meeting of
Stockholders, and at any adjournments thereof, with all the powers
the undersigned would have if personally present. Without limiting
the general authorization hereby given, said proxies are, and each
of them is, instructed to vote or act as follows on the proposals
set forth in this Proxy Statement.
THIS PROXY, WHEN
EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED “FOR” THE
PROPOSALS CONSTITUTING THE EXTENSION AMENDMENT AND CONVERSION
AMENDMENT CONSISTING OF PROPOSALS 1 AND 2.
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE “FOR” PROPOSALS 1 AND 2.
Important Notice
Regarding the Availability of Proxy Materials for the Special
Meeting of Stockholders to be held on May14, 2015: This
notice of meeting and the accompany proxy statement are available
at http://www.cstproxy.com/capitolacquisition/sm2015.
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
Proposal 1 – Extension of Corporate
Life
Amend Capitol’s amended and restated certificate of
incorporation to extend the date that Capitol has to consummate a
business combination to July 31, 2015.
|
|
¨
|
|
¨
|
|
¨
|
|
|
|
|
|
|
|
Proposal 2 – Approve the Conversion
Amend Capitol’s amended and restated certificate of
incorporation to allow the holders of shares of common stock issued
in Capitol’s initial public offering to elect to convert
their public shares into their pro rata portion of the funds held
in the trust account established at the time of the IPO if the
extension is implemented.
|
|
¨
|
|
¨
|
|
¨
|
Only if you vote
“FOR” proposal Number 2 and you hold shares of the
Corporation’s common stock issued in the Corporation’s
initial public offering, or public shares, may you exercise your
conversion rights with respect to all or a portion of your public
shares by marking the “Exercise Conversion Right” box
below and indicating how many public shares for which you are
exercising such conversion rights in the space provided. If you
exercise your conversion rights, then you will be exchanging the
indicated number of your public shares for cash and you will no
longer own such public shares. You will only be entitled to receive
cash for those public shares if you tender your stock certificates
representing such converted public shares to the
Corporation’s duly appointed agent PRIOR TO THE VOTE AT SUCH
MEETING.
EXERCISE CONVERSION
RIGHTS ¨
CONVERT _____________
PUBLIC SHARES OF THE CORPORATION
|
|
Dated:_________________________ 2015
|
|
|
|
|
|
|
|
|
Stockholder’s Signature
|
|
|
|
|
|
|
|
|
Stockholder’s Signature
|
Signature should agree with name printed hereon. If stock is held
in the name of more than one person, EACH joint owner should sign.
Executors, administrators, trustees, guardians, and attorneys
should indicate the capacity in which they sign. Attorneys should
submit powers of attorney.
PLEASE SIGN, DATE AND
RETURN THE PROXY IN THE ENVELOPE ENCLOSED TO CONTINENTAL STOCK
TRANSFER & TRUST COMPANY. THIS PROXY WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO
DIRECTION IS MADE, THIS PROXY WILL BE VOTED “FOR” THE
PROPOSALS SET FORTH IN PROPOSALS 1 AND 2 AND WILL GRANT
DISCRETIONARY AUTHORITY TO VOTE UPON SUCH OTHER
MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS
THEREOF. THIS PROXY WILL REVOKE ALL PRIOR PROXIES SIGNED BY
YOU.