SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(AMENDMENT NO. 1)
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 17, 2013
ANDINA ACQUISITION CORPORATION
(Exact Name of Registrant as Specified in Charter)
|(State or Other Jurisdiction||(Commission||(IRS Employer|
|of Incorporation)||File Number)||Identification No.)|
Carrera 10 No. 28-49, Torre A. Oficina 20-05, Bogota, Colombia
(Address of Principal Executive Offices) (Zip Code)
(Registrant’s Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
|¨||Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)|
|x||Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)|
|¨||Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))|
|¨||Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c))|
COMMENCING SHORTLY AFTER THE FILING OF THIS CURRENT REPORT ON FORM 8-K, AS AMENDED, ANDINA ACQUISITION CORPORATION (“ANDINA”) INTENDS TO HOLD PRESENTATIONS FOR CERTAIN OF ITS SHAREHOLDERS, AS WELL AS OTHER PERSONS WHO MIGHT BE INTERESTED IN PURCHASING ANDINA SECURITIES, REGARDING ITS MERGER WITH TECNOGLASS S.A. (“TECNOGLASS”) AND C.I. ENERGIA SOLAR S.A. E.S. WINDOWS (“ES”, COLLECTIVELY WITH TECNOGLASS, THE “COMPANY”), AS DESCRIBED IN THIS REPORT. THIS CURRENT REPORT ON FORM 8-K, AS AMENDED, INCLUDING SOME OR ALL OF THE EXHIBITS HERETO, WILL BE DISTRIBUTED TO PARTICIPANTS AT SUCH PRESENTATIONS.
EARLYBIRDCAPITAL, INC. (“EBC”), THE MANAGING UNDERWRITER OF ANDINA’S INITIAL PUBLIC OFFERING (“IPO”) CONSUMMATED IN MARCH 2012, AND MORGAN JOSEPH TRIARTISAN (“MJTA”) ARE ACTING AS ANDINA’S INVESTMENT BANKERS IN THESE EFFORTS, FOR WHICH EBC WILL RECEIVE A FEE OF $1,610,000 AND MJTA WILL RECEIVE A FEE OF $500,000. ANDINA, ITS DIRECTORS AND EXECUTIVE OFFICERS, EBC AND MJTA MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF PROXIES FOR THE EXTRAORDINARY GENERAL MEETING OF ANDINA SHAREHOLDERS TO BE HELD TO APPROVE THE MERGER.
SHAREHOLDERS OF ANDINA AND OTHER INTERESTED PERSONS ARE ADVISED TO READ, WHEN AVAILABLE, ANDINA’S PRELIMINARY PROXY STATEMENT AND DEFINITIVE PROXY STATEMENT IN CONNECTION WITH ANDINA’S SOLICITATION OF PROXIES FOR THE EXTRAORDINARY GENERAL MEETING BECAUSE THESE PROXY STATEMENTS WILL CONTAIN IMPORTANT INFORMATION. SUCH PERSONS CAN ALSO READ ANDINA’S FINAL PROSPECTUS, DATED MARCH 16, 2012, AND ANDINA’S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED FEBRUARY 28, 2013, AS AMENDED, FOR A DESCRIPTION OF THE SECURITY HOLDINGS OF THE ANDINA OFFICERS AND DIRECTORS AND OF EBC AND MJTA AND THEIR RESPECTIVE INTERESTS IN THE SUCCESSFUL CONSUMMATION OF THE MERGER. THE DEFINITIVE PROXY STATEMENT WILL BE MAILED TO SHAREHOLDERS AS OF A RECORD DATE TO BE ESTABLISHED FOR VOTING ON THE MERGER. SHAREHOLDERS WILL ALSO BE ABLE TO OBTAIN A COPY OF THE DEFINITIVE PROXY STATEMENT, WITHOUT CHARGE, BY DIRECTING A REQUEST TO: THE EQUITY GROUP INC., 800 THIRD AVENUE, 36TH FLOOR, NEW YORK, NEW YORK 10022. THE PRELIMINARY PROXY STATEMENT AND THE DEFINITIVE PROXY STATEMENT, ONCE AVAILABLE, AND THE FINAL PROSPECTUS AND ANNUAL REPORT ON FORM 10-K CAN ALSO BE OBTAINED, WITHOUT CHARGE, AT THE SECURITIES AND EXCHANGE COMMISSION’S INTERNET SITE (http://www.sec.gov).
CERTAIN OF THE COMPANY’S FINANCIAL INFORMATION AND DATA CONTAINED HEREIN AND IN THE EXHIBITS HERETO ARE UNAUDITED AND/OR WERE PREPARED BY THE COMPANY AS A PRIVATE COMPANY AND DO NOT CONFORM TO SEC REGULATION S-X. FURTHERMORE, THEY INCLUDE CERTAIN FINANCIAL INFORMATION (EBITDA) NOT DERIVED IN ACCORDANCE WITH UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (“GAAP”). ACCORDINGLY, SUCH INFORMATION AND DATA WILL BE ADJUSTED AND PRESENTED DIFFERENTLY IN ANDINA’S PRELIMINARY AND DEFINITIVE PROXY STATEMENTS TO SOLICIT SHAREHOLDER APPROVAL OF THE MERGER. ANDINA AND THE COMPANY BELIEVE THAT THE PRESENTATION OF NON-GAAP MEASURES PROVIDES INFORMATION THAT IS USEFUL TO INVESTORS AS IT INDICATES MORE CLEARLY THE ABILITY OF THE COMPANY TO MEET CAPITAL EXPENDITURES AND WORKING CAPITAL REQUIREMENTS AND OTHERWISE MEET ITS OBLIGATIONS AS THEY BECOME DUE.
ADDITIONAL INFORMATION AND FORWARD-LOOKING STATEMENTS
This report and the exhibits hereto are not a proxy statement or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the proposed transaction and shall not constitute an offer to sell or a solicitation of an offer to buy the securities of andina or THE COMPANY, nor shall there be any sale of any such securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction.
This report and the exhibits hereto include “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. COMPANY’s actual results may differ from its expectations, estimates and projections and, consequently, you should not rely on these forward looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, andina’s and THE COMPANY’s expectations with respect to future performance, anticipated financial impacts of the merger and related transactions; approval of the merger and related transactions by security holders; the satisfaction of the closing conditions to the merger and related transactions; and the timing of the completion of the merger and related transactions.
These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results. Most of these factors are outside the parties’ control and difficult to predict. Factors that may cause such differences include: business conditions; weather and natural disasters; changing interpretations of GAAP; outcomes of government reviews; inquiries and investigations and related litigation; continued compliance with government regulations; legislation or regulatory environments, requirements or changes adversely affecting the business in which THE COMPANY is engaged; fluctuations in customer demand; management of rapid growth; intensity of competition from other providers of SERVICES THAT THE COMPANY PROVIDES; general economic conditions; and geopolitical events and regulatory changes. Other factors include the possibility that the merger does not close, including due to the failure to receive required security holder approvals, or the failure of other closing conditions.
The foregoing list of factors is not exclusive. Additional information concerning these and other risk factors is contained in ANDINA’s most recent filings with the SEC. All subsequent written and oral forward-looking statements concerning ANDINA and THE COMPANY, the merger, the related transactions or other matters and attributable to andina and THE COMPANY or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements above. Readers are cautioned not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Neither ANDINA nor THE COMPANY undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement to reflect any change in their expectations or any change in events, conditions or circumstances on which any such statement is based.
This Current Report on Form 8-K/A is being filed as an amendment (“Amendment No. 1”) to the Current Report on Form 8-K filed by Andina Acquisition Corporation (“Andina”) with the Securities and Exchange Commission (the “SEC”) on August 22, 2013 (the “Original Filing”).
The purpose of this Amendment No. 1 is to correct the share price target for the fiscal year ending 2/29/16 referred to in Item 1.01 of the Original Filing under the heading “Merger Consideration – Earnout Shares,” which mistakenly indicated $14.00 per share instead of $15.00 per share, and to file a revised investor presentation referred to in Item 1.01 of the Original Filing under the heading “Investor Presentation.”
Item 1.01 and 9.01 of the Original Filing are accordingly being amended and restated in their entirety below. No other changes are being made to the Original Filing and all information speaks as of the date of the Original Filing.
|Item 1.01||Entry into a Material Definitive Agreement.|
General; Structure of Merger
On August 17, 2013, Andina Acquisition Corporation, a Cayman Islands exempted company (“Andina”), entered into an Agreement and Plan of Reorganization (the “Merger Agreement”) by and among Andina, Andina Merger Sub, Inc., a Cayman Islands exempted company and a wholly-owned subsidiary of Andina (“Merger Sub”), Tecnoglass S.A., a Colombian company (“Tecnoglass”), and C.I. Energia Solar S.A. E.S. Windows, a Colombian company (“ES”). Prior to the closing of the transactions contemplated by the Merger Agreement, Tecnoglass and ES will effect a corporate reorganization such that the shareholders of Tecnoglass and/or ES shall cease being shareholders of Tecnoglass and/or ES and shall become shareholders of a newly formed Cayman Islands exempted company. Tecnoglass and ES will each then become direct or indirect wholly-owned subsidiaries of such newly formed entity. References to the “Company” in this Form 8-K are references to this newly formed entity, including the operations of Tecnoglass and ES, as applicable. Upon the consummation of the transactions contemplated by the Merger Agreement, Merger Sub will be merged with and into the Company, with the Company surviving the merger and becoming a wholly-owned subsidiary of Andina. Upon the consummation of the merger contemplated by the Merger Agreement, Andina will change its name to “Tecnoglass Inc.”
The Company is a leading manufacturer of hi-spec, architectural glass and windows for the western hemisphere residential and commercial construction industries. Headquartered in Barranquilla, Colombia, the Company operates out of a 1.2 million square foot vertically-integrated, state-of-the-art manufacturing complex that provides easy access to the Americas, the Caribbean, and the Pacific. The Company exports 43% of its production to foreign countries and sells to more than 300 customers in North, Central and South America. The United States accounted for approximately 30% of its revenues in 2012. The Company’s tailored, high-end products are found on some of the world’s most distinctive properties, including the El Dorado Airport (Bogota), Imbanaco Medical Center (Cali), Trump Plaza (Panama), Trump Tower (Miami), and The Woodlands (Houston).
The merger is expected to be consummated after the required approval by the shareholders of Andina and the fulfillment of certain other conditions, as described herein and in the Merger Agreement.
The following summaries of the merger and related transactions, the Merger Agreement and the other agreements to be entered into by the parties are qualified in their entirety by reference to the text of the agreements, certain of which are attached as exhibits hereto and are incorporated herein by reference.
Closing Merger Consideration. The Company shareholders, in exchange for all of the ordinary shares of Company outstanding immediately prior to the merger, will receive from Andina:
|·||An aggregate of 17,525,000 ordinary shares of Andina, subject to adjustment upon certain events; and|
|·||an aggregate of 3,000,000 ordinary shares (the “Earnout Shares”) to be released upon the achievement of certain targets described below.|
Earnout Shares. The Earnout Shares have been issued and placed in escrow to be released to the Company shareholders upon the Company’s achievement of specified share price targets or targets based on the Company’s net earnings before interest income or expense, income taxes, depreciation, amortization and any expenses arising solely from the merger charged to income (“EBITDA”) in the fiscal years ending February 28, 2014, February 28, 2015 or February 29, 2016.
|The following table sets forth the targets and the number of Earnout Shares issuable to Company shareholders upon the achievement of such targets:|
|EBITDA Target||Number of Earnout Shares|
|Fiscal year ending 2/28/14||$12.00 per share||$||30,000,000||$||36,000,000||416,667||500,000|
|Fiscal year ending 2/28/15||$13.00 per share||$||35,000,000||$||40,000,000||875,000||1,000,000|
|Fiscal year ending 2/29/16||$15.00 per share||$||40,000,000||$||45,000,000||1,333,333||1,500,000|
If either the ordinary share target or the maximum EBITDA target is met in any fiscal year, Company shareholders receive the maximum number of Earnout Shares indicated for the year.
In the event the ordinary share target is not met but the combined company’s EBITDA falls within the minimum and maximum EBITDA target for a specified year, the number of Earnout Shares to be issued will be interpolated between such targets.
In the event neither the ordinary share target nor the minimum EBITDA target is met in a particular year, but a subsequent year’s share price or EBITDA target is met, the Company shareholders will earn the Earnout Shares for the previous year as if the prior year’s target had been met.
The shareholders of the Company will not be able to sell any of the ordinary shares of Andina that they receive for one year after the closing, subject to certain exceptions.
The Company shareholders will be granted the right to demand that Andina register for resale under the Securities Act of 1933, as amended (the “Securities Act”), all of the ordinary shares of Andina to be issued to them in the transaction following the closing. In addition, such shareholders will be granted certain “piggyback” registration rights with respect to such shares.
Indemnification of Andina and Company Shareholders
Andina and the Company shareholders have agreed to indemnify and hold harmless the other for their inaccuracies or breaches of the representations and warranties or for the non-fulfillment or breach of any covenant or agreement contained in the Merger Agreement and for certain other matters.
To provide a fund for payment to Andina with respect to its post-closing rights to indemnification under the Merger Agreement, there will be placed in escrow (with an independent escrow agent) an aggregate of 890,000 of the ordinary shares issuable to the Company shareholders at closing (“Indemnity Escrow Fund”). The escrow will be the sole remedy for Andina for its rights to indemnification under the Merger Agreement. On the date that is the earlier of (i) 30 days after the date on which Andina has filed its Annual Report on Form 10-K for its fiscal year ending February 28, 2015 or (ii) June 30, 2015, the shares remaining in the Indemnity Escrow Fund will be released to the Company holders except for any shares subject to pending claims and certain other matters.
No amount for indemnification shall be payable to either Andina on the one hand or the Company’s shareholders on the other unless and until the aggregate amount of all indemnifiable losses otherwise payable exceed a set deductible amount. The aggregate liability for losses of Andina on the one hand or the Company’s shareholders on the other shall not in any event exceed the value of the Escrow Fund. Andina shall have no claim for indemnity against the Company’s shareholders other than for any of the shares placed in escrow and the Company’s shareholders shall have no claim for indemnity against Andina other than for the issuance of additional ordinary shares of Andina.
Representations and Warranties
The Merger Agreement contains representations and warranties of the Company, Andina and Merger Sub relating to, among other things, (a) proper organization and similar corporate matters, (b) capital structure of each constituent company, (c) the authorization, performance and enforceability of the Merger Agreement, (d) licenses and permits, (e) taxes, (f) financial information and absence of undisclosed liabilities, (g) holding of leases and ownership of real property and other properties, including intellectual property, (h) accounts receivable, (i) contracts, (j) title to, and condition of, properties and environmental condition thereof, (k) absence of certain changes, (l) employee matters, (m) compliance with laws, (n) litigation and (o) regulatory matters.
Andina and the Company have each agreed to take such actions as are necessary, proper or advisable to consummate the merger. They have also agreed to continue to operate their respective businesses in the ordinary course prior to the closing and not to take certain specified actions without the prior written consent of the other party.
The Merger Agreement also contains additional covenants of the parties, including, among others, covenants providing for:
|(i)||The parties to use commercially reasonable efforts to obtain all necessary approvals from governmental agencies and other third parties that are required for the consummation of the transactions contemplated by the Merger Agreement;|
|(ii)||The protection of confidential information of the parties and, subject to the confidentiality requirements, the provision of reasonable access to information;|
|(iii)||The preparation and filing by Andina of a proxy statement to solicit proxies from the Andina shareholders regarding, among other things, the approval of the merger, approval of amendments to Andina’s Amended and Restated Memorandum and Articles of Association (“Charter Documents”), including the change of Andina’s name to “Tecnoglass Inc.,” adoption of a share option plan, approval of the convertibility of certain promissory notes issued (or to be issued) by Andina to its officers, directors, stockholders or affiliates for Andina’s working capital needs and election of directors to Andina’s board of directors.|
|(iv)||Andina and the Company to use their commercially reasonable efforts to obtain the listing of Andina’s ordinary shares and warrants on the New York Stock Exchange or Nasdaq;|
|(v)||The Company to waive its rights to make claims against Andina to collect from the trust fund established for the benefit of the holders of the shares sold in Andina’s IPO (“Public Shares”) for any monies that may be owed to them by Andina; and|
|(vi)||The Company to provide periodic financial information to Andina through the closing.|
Conditions to Closing
Consummation of the transactions is conditioned on (i) the Andina shareholders, at a meeting called for these purposes, approving the merger and (ii) the holders of not more than 87.5% of the Public Shares exercising their right to convert their Public Shares into a pro-rata portion of the trust fund.
In addition, the consummation of the transactions contemplated by the Merger Agreement is conditioned upon, among other things, (i) no order, injunction, judgment or decree being issued by any governmental authority or enactment of any statute, rule, regulation or other order which would prohibit in whole or in part, the consummation of such transactions, (ii) the execution by and delivery to each party of each of the various transaction documents, (iii) the delivery by each party to the other party of a certificate to the effect that the representations and warranties of each party are true and correct in all material respects as of the closing and all covenants contained in the Merger Agreement have been materially complied with by each party and (iv) the receipt of all necessary consents and approvals by third parties and the completion of necessary proceedings.
Andina’s Conditions to Closing
The obligations of Andina to consummate the transactions contemplated by the Merger Agreement, in addition to the conditions described above, are conditioned upon each of the following, among other things:
|·||there being no material adverse effect affecting the Company that has occurred since the signing of the Merger Agreement;|
|·||employment agreements with certain of the Company’s employees shall have been executed and delivered by the Company and such individuals;|
|·||(i) all outstanding indebtedness owned by any insider of the Company shall have been repaid in full; (ii) all guaranteed or similar arrangements pursuant to which the Company has guaranteed the payment or performance of any obligations of any Company insider to a third party shall have been terminated; and (iii) no Company insider shall own any direct equity interests in any subsidiary of the Company; and|
|·||receipt by Andina of opinions of Company’s counsel in agreed form.|
Company’s Conditions to Closing
The obligations of the Company to consummate the transactions contemplated by the Merger Agreement also are conditioned upon, among other things:
|·||there being no material adverse effect affecting Andina that has occurred since the signing of the Merger Agreement;|
|·||certain officers and directors of Andina shall have resigned effective on the closing of the merger and certain directors shall have been elected by Andina’s shareholders to serve on Andina’s board of directors;|
|·||after giving effect to the election of shareholders of Andina to have their Public Shares converted to cash and after payment of transaction costs incurred by Andina and the Company not to exceed $5,000,000 in the aggregate, Andina shall have an aggregate of at least $33,500,000 of cash held either in or outside of the trust fund and shall have made arrangements to have such amount disbursed to Andina upon the closing;|
|·||receipt by Company of opinions of Andina’s counsel in agreed form;|
|·||Andina shall have delivered to the Company shareholder lists evidencing at least 300 Round Lot Holders (as such term is defined in Rule 5005(a)(37) of the Nasdaq Listing Rules) of Andina’s ordinary shares, prior to the redemption of any ordinary shares of Andina upon consummation of the merger; and|
|·||Andina shall have caused public trading in its units (issued in connection with its initial public offering) to cease and for such units to be mandatorily separated into their component parts of ordinary shares and warrants.|
If permitted under applicable law, either Andina or the Company may waive any inaccuracies in the representations and warranties made to such party contained in the Merger Agreement and waive compliance with any agreements or conditions for the benefit of itself or such party contained in the Merger Agreement. The condition requiring that the holders of not more than 87.5% of the Public Shares have exercised their right to convert their Public Shares into a pro-rata portion of the trust fund may not be waived. There can be no assurance that all of the conditions will be satisfied or waived.
The Merger Agreement may be terminated at any time, but not later than the closing, as follows:
|(i)||by mutual written consent of Andina and the Company;|
|(ii)||by either Andina or the Company if the merger is not consummated on or before December 16, 2013;|
|(iii)||by either Andina or the Company if a governmental entity shall have issued an order, decree, judgment or ruling or taken any other action, in any case having the effect of permanently restraining, enjoining or otherwise prohibiting the merger, which order, decree, ruling or other action is final and nonappealable;|
|(iv)||by either Andina or the Company if the other party has breached any of its covenants or representations and warranties in any material respect and has not cured its breach within 30 days of the notice of an intent to terminate, provided that the terminating party is itself not in breach;|
|(v)||by either Andina or the Company if, at the Andina stockholder meeting, the merger shall fail to be approved by holders of Andina’s ordinary shares as required by Andina’s Charter Documents or the holders of more than 87.5% of the Public Shares exercise conversion rights; or,|
|(vi)||by Company if, immediately after the merger, Andina will not have cash on hand of $33,500,000 after payment of amounts that Andina may pay to converting shareholders and after payment of transaction costs incurred by Andina and Company not to exceed $5,000,000 in the aggregate, all as described in the Merger Agreement.|
Post-Merger Ownership of Andina
As a result of the merger, assuming that no shareholders of Andina elect to convert their Public Shares into cash as permitted by Andina’s Charter Documents, the Company shareholders will own approximately 76.9% of the ordinary shares of Andina to be outstanding immediately after the merger and the other Andina shareholders will own approximately 23.1% of Andina’s outstanding ordinary shares, in each case based on the Andina ordinary shares outstanding as of July 31, 2013. If the maximum number of Public Shares are converted into cash as permitted under the Merger Agreement leaving $33,500,000 in trust (after taking into account the payment of transaction costs incurred by Andina and the Company of up to $5,000,000 in the aggregate), such percentages will be approximately 78.4% and 21.6%, respectively. If the maximum number of Public Shares are converted into cash as permitted by Andina’s Charter Documents, such percentages will be approximately 91.9% and 8.1%, respectively. The foregoing does not take into account shares that would be released to the Company’s shareholders upon achievement of the Earnout Targets.
At the closing of the merger, subject to shareholder approval, Andina will create a share option plan for the benefit of employees of the Company and its subsidiaries, and shall allocate to the share option plan for issuance thereunder the number of shares equal to six percent (6%) of the ordinary shares outstanding immediately after the closing of the merger.
Andina is filing the attached investor presentation (Exhibit 99.3 to this Form 8-K) as Regulation FD Disclosure material.
Andina is filing the attached press releases (Exhibits 99.1 and 99.2 to this Form 8-K) as Regulation FD Disclosure material.
|Item 9.01||Financial Statements, Pro Forma Financial Information and Exhibits.|
|2.1||Agreement and Plan of Reorganization, dated as of August 17, 2013, by and among Andina Acquisition Corporation, Andina Merger Sub, Inc., Tecnoglass S.A. and C.I. Energia Solar S.A. E.S. Windows.* (1)|
|10.1||Form of Indemnity Escrow Agreement among Andina Acquisition Corporation, the Committee (as described in the Agreement and Plan of Reorganization), the Representative (as defined in the Agreement and Plan of Reorganization), and Continental Stock Transfer & Trust Company, as Escrow Agent. (1)|
|10.2||Form of Additional Shares Escrow Agreement among Andina Acquisition Corporation, the Committee (as described in the Agreement and Plan of Reorganization), the Representative (as defined in the Agreement and Plan of Reorganization), and Continental Stock Transfer & Trust Company, as Escrow Agent. (1)|
|10.3||Form of Lock-Up Agreement. (1)|
|10.4||Form of Amended and Restated Registration Rights Agreement between Andina Acquisition Corporation and certain Investors. (1)|
|99.1||Press release dated August 17, 2013. (1)|
|99.2||Press release dated August 19, 2013 (1)|
* Certain exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(b)(2). Andina agrees to furnish supplementally a copy of all omitted exhibits and schedules to the Securities and Exchange Commission upon its request.
(1) Previously filed.
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: September 4, 2013
|ANDINA ACQUISITION CORPORATION|
|By:||/s/ B. Luke Weil|
|Name: B. Luke Weil|
|Title:Chief Executive Officer|
A Leading Manufacturer of Architectural Glass & Windows Proposed Merger with Andina Acquisition Corporation (NASDAQ:ANDA/ANDAU/ANDAW) August 2013
2 This slide show was filed with the Securities and Exchange Commission on August 22 , 2013 as part of the Form 8 - K filed by Andina Acquisition Corporation (“ Andina ”) . Andina is holding presentations for certain of its shareholders, as well as other persons who might be interested in purchasing Andina’s securities, regarding its business combination with Tecnoglass S . A . (“ Tecnoglass ”) and C . I . Energia Solar S . A . E . S . Windows (“ES”) . This slide show will be distributed to attendees of these presentations . EarlyBirdCapital , Inc . (“EBC”), the managing underwriter of Andina’s initial public offering (“IPO”) consummated in March 2012 , and Morgan Joseph TriArtisan (“MJTA”) are acting as Andina’s investment bankers in these efforts . EBC will receive a fee of $ 1 , 610 , 000 and MJTA will receive a fee of $ 500 , 000 in connection with this engagement . Andina and its directors and executive officers, and EBC and MJTA may be deemed to be participants in the solicitation of proxies for the extraordinary general meeting of Andina’s shareholders to be held to approve the business combination . SHAREHOLDERS OF ANDINA AND OTHER INTERESTED PERSONS ARE ADVISED TO READ, WHEN AVAILABLE, ANDINA’S PROXY STATEMENT (“PROXY STATEMENT”) WHICH WILL CONTAIN IMPORTANT INFORMATION . Such persons may read Andina’s Proxy Statement, Andina’s final Prospectus for its IPO and its Annual Report on form 10 - K for the fiscal year ended February 28 , 2013 , as amended, for a description of the security holdings of Andina’s officers and directors and of EBC and MJTA and their respective interests in the successful consummation of the business combination . The Proxy Statement will be mailed to shareholders as of a record date to be established for voting on the business combination . Shareholders will also be able to obtain a copy of the Proxy Statement, without charge, by directing a request to : The Equity Group Inc . , 800 Third Avenue, 36 th Floor, New York, NY 10022 . The preliminary Proxy Statement and definitive Proxy Statement, once available, and final Prospectus can also be obtained, without charge, at the Securities and Exchange Commission’s internet site (http : //www . sec . gov) .
3 FORWARD LOOKING STATEMENTS This presentation may include “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995 . Forward - looking statements may be identified by the use of words such as “anticipate”, “believe”, “expect”, “estimate”, “plan”, “outlook”, and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters . Such forward looking statements with respect to the timing of the proposed business combination between Andina and Tecnoglass and ES, as well as the expected performance, strategies, prospects and other aspects of the business of Tecnoglass and ES and the combined company after completion of the proposed business combination, are based on current expectations that are subject to risks and uncertainties . A number of factors could cause actual results or outcomes to differ materially from those indicated by such forward looking statements . These factors include, but are not limited to : ( 1 ) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement for the business combination (the “Merger Agreement”), ( 2 ) the outcome of any legal proceedings against Andina , Tecnoglass , ES ; ( 3 ) the inability to complete the transaction contemplated by the Merger Agreement, including due to failure to obtain approval of the shareholders of Andina or other conditions to closing in the Merger Agreement ; ( 4 ) delays in obtaining, adverse conditions contained in, or the inability to obtain necessary regulatory approvals or complete regulator reviews required to complete the transactions contemplated by the Merger Agreement ; ( 5 ) the risk that the proposed transaction disrupts current plans and operations as a result of the announcement and consummation of the transaction described therein and herein ; ( 6 ) the ability to recognize the anticipated benefits of the business combination, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably, maintain relationships with suppliers and obtain adequate supply of products and retain its key employees ; ( 7 ) costs related to the proposed business combination ; ( 8 ) changes in applicable laws or regulations ; ( 9 ) the possibility that the combined company may be adversely affected by other economic, business, and/or competitive factors ; and ( 10 ) other risks and uncertainties indicated from time to time in Andina’s filings with the SEC . Readers are cautioned not to place undue reliance upon any forward - looking statements, which speak only as of the date made, and Andina and Tecnoglass undertake no obligation to update or revise the forward - looking statements, whether as a result of new information, future events or otherwise .
4 FINANCIAL PRESENTATION Certain of the financial information contained herein is unaudited and does not conform to SEC Regulation S - X . Furthermore, it includes EBITDA (earnings before interest, taxes depreciation and amortization) which is a non - GAAP financial measure as defined by Regulation G promulgated by the SEC under the Securities Act of 1933 , as amended . Accordingly, such information may be materially different when presented in Andina’s filings with the Securities and Exchange Commission . Andina and Tecnoglass believe that the presentation of this non - GAAP financial measure provides information that is useful to investors as it indicates more clearly the ability of Tecnoglass to meet capital expenditures and working capital requirements and otherwise meet its obligations as they become due . EBITDA was derived by taking earnings before interest, taxes, depreciation and amortization as adjusted for certain one - time non - recurring items and exclusions .
• Tecnoglass S.A. and C.I. Energia Solar E.S Windows to go public via transaction with Andina Acquisition Corporation • Current owners of Tecnoglass will retain majority ownership and operational control • Proceeds devoted exclusively to funding growth; no selling shareholders • Combined entity: Tecnoglass Inc., a vertically - integrated manufacturer of architectural and industrial glass and windows, and associated aluminum products. Tecnoglass S.A. and C.I. Energia Solar E.S Windows are industry leaders operating under common management for over 20 years • Strategic location in Barranquilla, Colombia; easy access to the Americas, the Caribbean & the Pacific • Consistent growth in revenue and EBITDA; robust growth projected • Approximately 30% of sales into the U.S. • High barriers to entry • Would become only Colombian - headquartered company listed on NASDAQ 5 THE OPPORTUNITY A Leading, Global Manufacturer of Architectural Glass
THE TRANSACTION Summary of Merger Terms • Business combination valued at approximately $243 mm or approximately $ 278 mm on a pro forma fully diluted (treasury method) basis (1 ) – 10.3x LTM 6/30/2013 adjusted EBITDA – 9.7x 2013E adjusted EBITDA – Significant discount to publicly traded peers (2) • TGS/ES shareholders rolling interests into Andina – 17.5 mm shares issued to TGS/ES shareholders ( 3 ) – 3 mm additional contingency shares reserved based on reaching pre - determined adjusted EBITDA or share price targets through 2016 – 1 - year lock - up on Andina sponsor shares and shares issued to TGS/ES shareholders • 22.8 mm basic shares outstanding at closing ( 4 ) • Conditions to closing: – Minimum cash of $33.5 mm at closing, net of expenses – Andina shareholder approval • Transaction estimated to close Q4 2013 (1) Assumes $10.18 stock price (2) Based on LTM 6/30/2013 and 2013E Enterprise Value / Adj. EBITDA multiples of 15.9x and 13.6x, respectively, for PGT, Inc. (PGTI) and 12.9x and 10.7x, respectively, for Apogee Enterprises, Inc. (APOG) as of 8/20/2013. (3) Based on LTM 6/30/2013 unaudited EBITDA of $27 mm and Net Debt of $65.1mm (4) Assuming no redemptions by Andina stockholders 6
3,000,000 total contingent consideration shares to TGS/ES − The contingent shares may be issued based on meeting the EBITDA targets of $36 mm in 2014, $40 mm in 2015 and $45 mm in 2016; or − By meeting certain stock price targets in the same year, $12.00 in 2014, $13.00 in 2015 and $15.00 in 2016 An equity stock option plan for management, 6.0% of basic shares outstanding, will be instituted Transaction Highlights THE TRANSACTION Structure & Ownership 7 (1) Assumes no redemptions. Treasury method based on $10.18 stock price (2) Pro Forma for estimated total transaction expenses of $2,850,000 (3) Includes the contingent consideration shares issued at each EBITDA target 70.5% 20.5% 9.0% Pro Forma Diluted (Treasury) Ownership at Closing TGS/ES Shareholders Public Shareholders Andina Sponsors & Other Enterprise Value at Closing ($ in millions, except per share data) (1) Assumed Price Per Share 10.18$ Diluted Shares (Treasury) (1) 24.9 Diluted Equity Value 253.1$ Plus: Pro Forma Debt 68.0 Less: Estimated Cash at Closing (2) (42.8) Enterprise Value 278.3$ LTM FY FY FY FY 6/30/2013 2013E 2014E 2015E 2016E Pro Forma EBITDA Target 27.0$ 28.7$ 36.0$ 40.0$ 45.0$ Add'l Contingent Consideration Shares - - 0.5 1.0 1.5 Assumed Price Per Share 10.18$ 10.18$ 10.18$ 10.18$ 10.18$ Contingent Consideration -$ -$ 5.1$ 10.2$ 15.3$ Diluted Shares (Treasury) (1)(3) 24.9 24.9 25.4 26.4 27.9 Diluted Equity Value 253.1$ 253.1$ 258.2$ 268.3$ 283.6$ Plus: Pro Forma Debt 68.0 68.0 68.0 68.0 68.0 Less: Estimated Cash at Closing (2) (42.8) (42.8) (42.8) (42.8) (42.8) Enterprise Value 278.3$ 278.3$ 283.4$ 293.5$ 308.8$ TEV/EBITDA Multiple 10.3x 9.7x 7.9x 7.3x 6.9x
INVESTMENT HIGHLIGHTS Industry Leader High Quality, Innovative Products Global Customer Base; Hi - Spec Products for Premier Properties Record of Success; Robust Growth Projected High Barriers to Entry Attractive Market Dynamics and Compelling Valuation Strong & Experienced Management Team
9 INVESTMENT HIGHLIGHTS Industry Leader • Tecnoglass S.A. – founded 1994 – #1 glass transformation company in Colombia with 40% market share – Glass Magazine has ranked Tecnoglass as the second largest glass fabricator serving the U.S. market in 2012 (1) – Aluminum plant established 2007 ( Alutions by Tecnoglass ) • C.I. Energia Solar E.S Windows – founded 1984 – Designs, manufactures, markets, and installs architectural glass for commercial and large - scale residential construction – Utilizes glass and aluminum produced by Tecnoglass – Leading player in Colombia Target Markets Construction and remodeling of: • Hotels • Residential dwellings • Commercial & corporate centers • Office buildings • Educational facilities • Airports • Hospitals 2012 Revenue Tecnoglass S.A. 53% Energia Solar 47% http://www.glassmagazinedigital.com/publication/?i=145042&p=44&search_str=tecnoglass (1)
INVESTMENT HIGHLIGHTS High Quality, Innovative Products 10 Glass Products Description Laminated / Thermo - Laminated Produced by bonding two glass sheets with an intermediate film between. Safety product – fractures into small pieces if it breaks. Thermo - Acoustic Manufactured with two or more glass sheets separated by an aluminum or micro - perforated steel profile. Has a double - seal system that ensures the unit’s tightness, buffering noise and improving thermal control. Serves as an excellent noise barrier, which is used especially in zones close to airports, traffic or wherever there are unpleasant sounds. Tempered Glass subject to a tempering process through elevated temperatures. Greater superficial elasticity and resistance than conventional glass. Silk - Screened Special paint is applied to glass using automated CNC machinery which ensures paint homogeneity and an excellent finish. Curved Produced by bending a flat glass sheet over a mold, using an automated heat process, which maintains the glass’ physical properties. Digital Print Digital print glass offers architects structured and artistic design. Digital printing allows assuming any kind of appearance required by the client, offering versatility to projects.
INVESTMENT HIGHLIGHTS High Quality, Innovative Products 11 Finished Products Windows Floating facades Commercial display windows Hurricane - proof windows Automatic doors Commercial display windows Bathroom dividers Aluminum Products Bars Plates Profiles Rods Tubes
INVESTMENT HIGHLIGHTS Global Customer Base; Hi - Spec Products for Premier Properties • 300+ customers in North, Central and South America • No customer accounts for greater than 10% of revenues • 80 - 85% of glass and aluminum sales to architectural market; 15 - 20% to industrial • Sell architectural products primarily through window contractors • Products used in premier projects across the Americas, particularly the U.S. and Colombia 12
13 INVESTMENT HIGHLIGHTS Global Customer Base; Hi - Spec Products for Premier Properties Park Square at Doral (Miami, FL) Trump Plaza (Panama) South Dade Miami Cultural Arts Center (Miami, FL) The W Hotel (Ft. Lauderdale, FL) Miami Courthouse (Miami, FL) 4 Waterway Square (The Woodlands, TX) Aeropuerto El Dorado (Bogota)
INVESTMENT HIGHLIGHTS Record of Success; Robust Growth Projected 14 (1) Unaudited $60 $64 $84 $93 $107 $127 $44 $50 $75 $88 $93 $107 $104 $114 $158 $180 $200 $234 2010A 2011A 2012A LTM 6/30/13 2013E 2014E Consolidated Revenue (USD mm) Tecnoglass Energia Solar $7 $9 $14 $14 $18 $23 $4 $5 $9 $13 $10 $13 $11 $13 $22 $27 $29 $36 2010A 2011A 2012A LTM 6/30/13 2013E 2014E Consolidated Adj. EBITDA (USD mm) Tecnoglass Energia Solar (1) (1) (1) Unaudited (1) (1) • Consistent revenue and adjusted EBITDA growth: CAGR 2010 - 2014E of 23% and 34%, respectively, despite challenging economic environment
INVESTMENT HIGHLIGHTS Record of Success; Robust Growth Projected Strategy for Continued Growth • Post - transaction balance sheet significantly expands bonding capacity by at least $100mm in the US ( currently $60 mm), allowing participation in larger projects • Increase market share in U.S. and South America • Penetrate European and Asian markets, leveraging labor and transportation advantages • Establish and maintain alliances • Continued investments in product innovation and state - of - the - art manufacturing technology – “Thermal Break” system – ES powdered paint line 15
16 INVESTMENT HIGHLIGHTS High Barriers to Entry • Vertical integration • Strict regulation and product standardization requirements, notably in hurricane - prone markets in the U.S., Latin America, and Caribbean • Demand for quality: safety, comfort, environmental control • Only PPG certified glass fabricator in South America • Product breadth Industry Certifications
INVESTMENT HIGHLIGHTS High Barriers to Entry: Vertically Integrated State - of - the - Art Manufacturing Facility 17 1.2 mm square foot, state - of - the - art manufacturing complex in Barranquilla, Colombia provides distinct and formidable competitive advantage Glass production; features include: – Four lamination machines; independent assembly rooms – Six specialized tempering furnaces and state - of - the - art glass molding furnaces – CNC - controlled profile bending machine; five silk - screening machines Aluminum plant – Capacity of 1,000 tons/month – Creates wide variety of shapes and forms for the door and window industries – Smelter furnace provides 90% of raw materials used in aluminum production Window and façade assembly plant Tecnoglass manufactures various glass + aluminum products C.E. Energia Solar produces customized finished products Tecnoglass purchases prime raw materials Quick, on - time delivery to global customers Vertical Integration : Price Competitiveness, Quality Control, Delivery Assurance
• ~ $27 mm in capital investments (2012) • Best practices in sustainability and environmental responsibility – Recycle ~ 30% of manufacturing - related residues – Self - supplied power generation • Location favors: – Exports to the Americas, the Caribbean, and the Pacific – Imports of raw materials BERLIN - GERMANY 18 INVESTMENT HIGHLIGHTS High Barriers to Entry: Strategic Location
INVESTMENT HIGHLIGHTS Attractive Market Dynamics • Global construction industry expected to grow from $7.2 trillion currently to over $10 trillion by 2020 (13% of global GDP to 15%) (1) • Latin America: $550 billion – Growing annually at 6% with good long - term prospects (2) • U.S.: $830 billion – $262 billion residential – $344 billion commercial – $283 billion public (3) – $21 billion U.S. window and door market, growing 9% annually to 2016 (4) – U.S. housing start market at annualized 914,000 as of May 2013, projected to grow to 1,172,000 by year - end 2014 (5) North America 24% Latin America 8% East Asia / Australia 34% Europe 24% Middle East / Africa 6% Central Asia 4% $ 7.2 trillion Global Construction Market (2 ) Construction Market Growth by Region (2) U.S. 6% Latin America 6% Developing Asia 6% Middle East / Africa 5% Central Asia 4% Europe (2%) Worldwide 4% (1) Global Construction 2020 by Global Construction Perspectives and Oxford Economics (2) KHL Group, 2012 (3) U.S. Census Bureau (4 ) The Freedonia Group Inc ., 2012 (5) NAHB (National Association of Home Builders) 19
INVESTMENT HIGHLIGHTS Attractive Market Dynamics U.S. demand for windows is expected to grow significantly over the next several years... 66.7 59.1 48.4 38.9 41.6 37.9 40.5 45.8 54.2 58.9 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0 2006 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E U.S. Window Demand by Shipments (mm units) (1) (1) Ducker Worldwide / Bank of America as of 1/10/2013 20
INVESTMENT HIGHLIGHTS Attractive Market Dynamics ...aided by niche Southeastern U.S. / Florida impact - resistant window and door market 0 50 100 150 200 250 2006 2007 2008 2009 2010 2011 2012 2013E 2014E 2015E 2016E Florida Total Housing Starts (000s) (2) Florida Impact Resistant Window & Door Market (1) (1) State of Florida.; Florida Building Commission ; building codes require structures to withstand wind speeds shown on map in these ranges (2) Historical and forecasts from University of Central Florida, 2013 21
22 INVESTMENT HIGHLIGHTS Strong & Experienced Management Team Name Position Jose M. Daes CEO of Energia Solar Christian Daes President of Tecnoglass Rodolfo E. Meola President of Energia Solar • Tecnoglass management will remain in place
COMPARISON TO PUBLIC COMPARABLES Business Comparison Competitor LTM Revenue HQ Commercial Reside ntial Project Size Glass Alum Hurricane Proof Geographic Reach Customers LTM EBITDA Margin Apogee (APOG) $725mm Minnesota, US x - Mid / Large x - x U.S. & Brazil Contractors & Distributors 8.0% PGT (PGTI) $202mm Florida, US - x Small / Mid x - x Southeast U.S. Contractors & Distributors 15.6% Tecnoglass $158mm Barranquilla, Colombia x x Mid / Large x x x U.S. & Latin America Contractors & Distributors 14.2% 23
COMPARISON TO PUBLIC COMPARABLES Attractive Valuation & Growth Profile 24 • Over the last 12 months, the share - price performance of Tecnoglass’s public comparables has far outperformed the growth of S&P, Nasdaq and Dow Jones Indexes • Transaction values Tecnoglass at a compelling discount to closest public comparables 24.4% 9.7% 8.7% Revenue CAGR (2010 - 2013E) 15.9x 12.9x 10.3x 13.6x 10.7x 9.7x EV / EBITDA (LTM & 2013E)* * Lighter color represents EV/LTM EBITDA, darker represents EV/2013E EBITDA Enterprise value as of 8/20/13; 2013E consensus estimates from Bloomberg as of 8/20/13 LTM as of 6/30/13; 2013E represents FY ended 12/31/13 for Tecnoglass and PGT and 2/28/14 for Apogee Peer Median 9.2% Peer Median 14.4x LTM 12.2x 2013E