-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, W0Qnq30Qd4V25iYA6J3CJJoOjp3nhbiVPaQcyLUIDSuPZQwOOupfBNvWWwrWF5C1 Xmy4dOa+/2MdiMT9AZDDLw== 0000950136-07-007070.txt : 20071018 0000950136-07-007070.hdr.sgml : 20071018 20071017214940 ACCESSION NUMBER: 0000950136-07-007070 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20071018 DATE AS OF CHANGE: 20071017 GROUP MEMBERS: FIELDPOINT CAPITAL, LLC GROUP MEMBERS: IVY HEALTHCARE CAPITAL II, L.P. GROUP MEMBERS: ROBERT W. PANGIA SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: Highlands Acquisition Corp CENTRAL INDEX KEY: 0001398632 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 208924044 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-83166 FILM NUMBER: 071177618 BUSINESS ADDRESS: STREET 1: ONE LANDMARK SQUARE STREET 2: 22ND FLOOR CITY: STAMFORD STATE: CT ZIP: 06901 BUSINESS PHONE: 203-428-2080 MAIL ADDRESS: STREET 1: ONE LANDMARK SQUARE STREET 2: 22ND FLOOR CITY: STAMFORD STATE: CT ZIP: 06901 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Warren Russell F JR CENTRAL INDEX KEY: 0001413434 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: BUSINESS PHONE: 201-573-8400 MAIL ADDRESS: STREET 1: ONE PARAGON DRIVE STREET 2: SUITE 125 CITY: MONTVALE STATE: NJ ZIP: 07645 SC 13D 1 file1.htm SCHEDULE 13D

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

HIGHLANDS ACQUISITION CORP.

(Name of Issuer)

Common Stock, $0.0001 par value

(Title of Class of Securities)

430880 104

(CUSIP Number)

Ivy Healthcare Capital II, L.P.

One Paragon Drive

Suite 125

Montvale, New Jersey 07645

Copy to:

Roger Meltzer, Esq.

DLA Piper US LLP

1251 Avenue of the Americas

New York, New York 10020

(212) 335-4500

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

October 3, 2007

(Date of Event which requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box o

CUSIP No. 430880 104

13D

Page 1 of 11 Pages

NAME OF REPORTING PERSON

S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

Russell F. Warren, Jr.

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)

(a) o

(b) x

SEC USE ONLY

SOURCE OF FUNDS*

N/A

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) o

CITIZENSHIP OR PLACE OF ORGANIZATION

United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH

SOLE VOTING POWER

695,548

SHARED VOTING POWER

680,242

SOLE DISPOSITIVE POWER

695,548

SHARED DISPOSITIVE POWER

680,242

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

1,375,790

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

8.0%

TYPE OF REPORTING PERSON*

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Page 2 of 11 Pages

NAME OF REPORTING PERSON

S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

Robert W. Pangia

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)

(a) o

(b) x

SEC USE ONLY

SOURCE OF FUNDS*

N/A

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) o

CITIZENSHIP OR PLACE OF ORGANIZATION

United States

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH

SOLE VOTING POWER

266,996

SHARED VOTING POWER

680,242

SOLE DISPOSITIVE POWER

266,996

SHARED DISPOSITIVE POWER

680,242

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

947,238

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.5%

TYPE OF REPORTING PERSON*

CUSIP No. 430880 104

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Page 3 of 11 Pages

NAME OF REPORTING PERSON

S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

Ivy Healthcare Capital II, L.P.

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)

(a) o

(b) x

SEC USE ONLY

SOURCE OF FUNDS*

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) o

CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH

SOLE VOTING POWER

SHARED VOTING POWER

680,242

SOLE DISPOSITIVE POWER

SHARED DISPOSITIVE POWER

680,242

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

680,242

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

3.9%

TYPE OF REPORTING PERSON*

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Page 4 of 11 Pages

NAME OF REPORTING PERSON

S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

Fieldpoint Capital, LLC

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)

(a) o

(b) x

SEC USE ONLY

SOURCE OF FUNDS*

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) o

CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware

NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON
WITH

SOLE VOTING POWER

SHARED VOTING POWER

695,548

SOLE DISPOSITIVE POWER

SHARED DISPOSITIVE POWER

695,548

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

695,548

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

4.0%

TYPE OF REPORTING PERSON*

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Page 5 of 11 Pages

Item 1. Security and Issuer.

This Schedule 13D (the “Statement”) relates to the shares of common stock, $0.0001 par value per share (the “Common Stock”) issued by Highlands Acquisition Corp. (the “Issuer”), whose principal executive offices are located at One Paragon Drive, Suite 125, Montvale, NJ 07645.

Item 2. Identity and Background.

(a), (b), (c) and (f). This Statement is filed by the Reporting Persons. The “Reporting Persons” are Ivy Healthcare Capital II, L.P., a Delaware limited partnership (“Ivy Healthcare”), Fieldpoint Capital, LLC, a Delaware limited liability company (“Fieldpoint”), Mr. Russell F. Warren, Jr. (“Warren Jr.”) and Mr. Robert W. Pangia (“Pangia”). Warren Jr., a citizen of the United States of America, is a principal of Ivy Capital Partners, the General Partner of Ivy Healthcare and is a manager of, and owns a 32.67% partnership interest in, Fieldpoint. Pangia, a citizen of the United States of America, is a principal of Ivy Capital Partners, the General Partner of Ivy Healthcare.

The business address of the Reporting Persons is One Paragon Drive, Suite 125, Montvale, NJ 07645.

(d) and (e). During the last five years, none of the Reporting Persons have been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.

On May 1, 2007, Ivy Healthcare and Fieldpoint purchased 492,929 units and 504,020 units of the Issuer, respectively (the “Founders’ Units”) in a private placement at a purchase price of $0.01 per unit ($4,929.29 and $5,040.20, respectively). Effective July 16, 2007, the Issuer’s board of directors authorized a unit dividend of 0.15 units for each outstanding Founders’ Unit, effectively lowering the purchase price to approximately $0.009 per unit and increasing the number of Founders’ Units to 566,868 and 579,623, respectively. Effective October 3, 2007, the Issuer’s board of directors authorized a unit dividend of .20 units for each outstanding Founders’ Unit, effectively lowering the purchase price to approximately $0.007 per unit and increasing the number of Founders’ Units to 680,242 and 695,548, respectively. Each Founders’ Unit consists of one share of Common Stock and one warrant to purchase one share of Common Stock (the “Founders’ Warrants”). The Founders’ Warrants have an exercise price of $7.50 per share and will become exercisable upon the later of the completion of the Issuer’s initial business combination with a target business and January 3, 2009; provided that the last sales price of the Issuer’s Common Stock exceeds $14.25 per share for any 20 trading days within a 30-trading day period beginning 90 days after the consummation of the Issuer’s initial business combination. Ivy Healthcare and Fieldpoint financed their purchases of the Founders’ Units through the use of working capital.

On October 9, 2007, Ivy Healthcare and Fieldpoint purchased warrants to purchase an aggregate of 454,545 and 464,773 shares of Common Stock, respectively (the “Sponsors’

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Page 6 of 11 Pages

Warrants”) in a private placement at a purchase price of $1.00 per Warrant ($454,545 and $464,773, respectively). The Sponsors’ Warrants have an exercise price of $7.50 per share and will become exercisable upon the later of the completion by the Issuer of its initial business combination and January 3, 2009. Ivy Healthcare and Fieldpoint financed their purchases of the Sponsors’ Warrants through the use of working capital.

Item 4. Purpose of Transaction.

The Reporting Persons acquired the Founders’ Units and the Sponsors’ Warrants for investment purposes.

Letter Agreement

Both Warren Jr. and Pangia, have entered into letter agreements with the Issuer and Citigroup Global Markets, Inc., dated as of October 3, 2007 (the “Letter Agreements”). Pursuant to the terms of the letter agreements, Messrs. Warren Jr. and Pangia have agreed to vote the shares of Common Stock beneficially owned by them prior to the initial public offering (the “Founders’ Shares”) in the same manner as the majority of shares cast by public stockholders in connection with the vote required to approve the Issuer’s initial business combination and for the proposal to amend the Issuer’s certificate of incorporation to provide for the Issuer’s perpetual existence. In addition, Messrs. Warren Jr. and Pangia has agreed to vote any and all shares of Common Stock acquired by them in the initial public offering or thereafter in favor of the Issuer’s initial business combination. Messrs. Warren Jr. and Pangia also agreed to not propose, or vote in favor of, an amendment to the Issuer’s certificate of incorporation to extend the period of time in which the Issuer must consummate its initial business combination prior to its liquidation. Should such a proposal be put before the Issuer’s stockholders, Messrs. Warren Jr. and Pangia agreed to vote against such proposal except in connection with the Issuer’s initial business combination to give the Issuer perpetual existence. The Letter Agreements further provides that the Sponsors’ Warrants, the Founders’ Shares and the Co-Investment Units (as defined below) are subject to transfer restrictions, except with respect to certain exceptions, all as more fully set forth in the Letter Agreements.

The description of the Letter Agreements in this Item 4 of the Statement is qualified in its entirety by reference to the full text of the Letter Agreements, the form of which is filed as Exhibit 10.5 to the Issuer’s Registration Statement on Form S-1, filed with the Securities and Exchange Commission on August 7, 2007.

Stockholders Agreement

On October 2, 2007, the Reporting Persons entered into a stockholders agreement (the “Stockholders Agreement”) with each of Highland Equity LLC, Kanders & Company, Inc., Warren B. Kanders (Highland Equity LLC, Kanders & Company, Inc. and Warren B. Kanders, together, the “Kanders Stockholders”), Dennis W. O’Dowd and Virgilio Rene Veloso (Dennis W. O’Dowd, Virgilio Rene Veloso and the Reporting Persons, together, the “Ivy Stockholders”) which will continue to be in effect for a period of up to three years after the consummation of the initial business combination of the Issuer. The Stockholders Agreement provides that the Kanders Representative and the Ivy Representative (each as defined in the Stockholders Agreement) shall each have the option, but not the obligation, to propose one director to the nominating committee of the Issuer’s board of directors for nomination as a candidate for election to the board of directors of the Issuer. In the event that all candidates proposed for nomination by the Kanders Representative and the Ivy Representative, as applicable, are nominated for election by the nominating committee of the Issuer’s board of directors, each of the parties to the

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Stockholders Agreement have agreed (subject to any existing fiduciary duties of such stockholders) to vote all shares of stock beneficially owned or held of record by such stockholders and shares of stock as to which they respectively have voting control over for, and agreed to use their reasonable best efforts to cause their respective affiliates to vote for, the respective nominees of the Kanders Representative and the Ivy Representative.

The Stockholders Agreement further provides that if a director nominated by the Kanders Representative or the Ivy Representative dies, resigns or is removed as a director and there is a resulting vacancy in the board of directors of the Issuer and the Kanders Representative or the Ivy Representative, as applicable, proposes a substitute candidate to the nominating committee of the Issuer’s board of directors to fill such vacancy and such substitute candidate is nominated by the nominating committee of the Issuer’s board of directors for election to the board of directors, each stockholder has agreed to vote all shares of stock owned by such stockholder to elect such substitute candidate nominated by the Kanders Representative or the Ivy Representative, as applicable. Additionally, in the event that any of the Ivy Stockholders fails to purchase the Co-Investment Units subscribed by it pursuant to the Co-Investment Subscription Agreement (as defined below), then the other Ivy Stockholders first and thereafter the Kanders Stockholders shall have the option, but not the obligation, to purchase, all but not less than all, of the remaining Co-Investment Units not purchased by any of the Ivy Stockholders. In the event that the Kanders Stockholders purchase the Co-Investment Units that were subscribed for by any of the Ivy Stockholders and not purchased by the other Ivy Stockholders the Ivy Stockholders will be required to transfer and deliver to the Kanders Stockholders a pro-rata amount of the Founders’ Units beneficially owned by such Ivy Stockholders. Reciprocal provisions apply to defaults under the Co-Investment Subscription Agreements executed by certain of the Kanders Stockholders.

The description of the Stockholders Agreement in this Item 4 of the Statement is qualified in its entirety by reference to the full text of the Stockholders Agreement, a copy of which is incorporated by reference into this Statement as Exhibit 99.1.

Co-Investment Subscription Agreement

Ivy Healthcare, Fieldpoint and Pangia each entered into a subscription agreement dated as of May 31, 2007 (the “Co-Investment Subscription Agreement”), pursuant which to they agreed to purchase 202,020, 206,565 and 79,293 units, respectively (‘‘Co-Investment Units’’) at a price of $10 per unit from the Issuer in a private placement that will occur immediately prior to the Issuer’s consummation of its initial business combination. These Co-Investment Units are identical to the units sold in the Issuer’s initial public offering and may not be sold, transferred, or assigned until at least one year after the completion of the Issuer’s initial business combination.

Pursuant to the Co-Investment Subscription Agreement, if any of the Ivy Stockholders fails to purchase the Co-Investment Units and the other Ivy Stockholders or the Kanders Stockholders do not satisfy such party’s co-investment obligation in full, the Ivy Stockholders have agreed to sell, and the Issuer has agreed to purchase, such Ivy Stockholders’ Founders’ Units at the same purchase price the founders originally paid for them.

The description of the Co-Investment Subscription Agreement in this Item 4 of the Statement is qualified in its entirety by reference to the full text of the Co-Investment Subscription Agreement, the form of which is filed as Exhibit 10.17 to the Issuer’s Registration Statement on Form S-1, filed with the Securities and Exchange Commission on August 7, 2007.

CUSIP No. 430880 104

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Escrow Agreement

On October 3, 2007, Ivy Healthcare, Fieldpoint and Pangia entered into an escrow agreement (the “Escrow Agreement”) with Continental Stock Transfer & Trust Company, and the other Ivy Stockholders, and the Kanders Stockholders. Pursuant to the terms of the Escrow Agreement all of the Founders’ Unit will be placed in escrow until one year after the consummation of the Issuer’s initial business combination. A portion of the Founders’ Units will be released from escrow earlier than as described above and returned to the Issuer for cancellation at no cost if and to the extent the underwriters’ over-allotment option in the Issuer’s initial public offering is not exercised in full or expires unexercised. The Founders’ Units may be released from escrow earlier than as described above and are subject to transfer restrictions, subject to certain exceptions, all as more fully set forth in the Escrow Agreement.

The description of the Escrow Agreement in this Item 4 of the Statement is qualified in its entirety by reference to the full text of the Escrow Agreement, the form of which is filed as Exhibit 10.12 to the Issuer’s Registration Statement on Form S-1, filed with the Securities and Exchange Commission on August 7, 2007.

Other than as set forth in this Item 4, the Reporting Persons do not have any current plans, proposals or negotiations that relate to or would result in any of the matters referred to in paragraphs (a) through (j) of Item 4 of the Statement. The Reporting Persons intend to review their investment in the Issuer on a continuing basis, and to the extent permitted by law, may seek to engage in discussions with other stockholders and/or with management and the board of directors of the Issuer concerning the business, operations or future plans of the Issuer. Depending on various factors including, without limitation, the Issuer’s financial position, the price levels of the Common Stock, conditions in the securities markets and general economic and industry conditions, the Reporting Persons may, except as may be precluded by the agreements described above in this Item 4, in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, purchasing additional Common Stock, selling Common Stock, engaging in short selling of or any hedging or similar transaction with respect to the Common Stock, taking any other action with respect to the Issuer or any of its securities in any manner permitted by law or changing their intention with respect to any and all matters referred to in paragraphs (a) through (j) of Item 4.

Item 5. Interest in Securities of the Issuer.

(a), (b) and (c) As of October 12, 2007, the Reporting Persons beneficially owned in the aggregate 1,642,786 shares of Common Stock, constituting approximately 9.5% of the outstanding shares of Common Stock (the percentage of shares owned being based upon 17,250,000 shares of Common Stock outstanding as of October 9, 2007, as set forth in the Issuer’s audited financials filed as Exhibit 99.1 to its Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 11, 2007, plus 1,800,000 shares issued on October 15, 2007 pursuant to the underwriters’ over-allotment option, as disclosed by the Issuer in its Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 15, 2007). This does not include shares of Common Stock which may be purchased pursuant to the Founders’ Warrants or the Sponsors’ Warrants because such warrants are n ot exercisable within the next 60 days and may not become exercisable within the next 60 days.

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The following table sets forth certain information with respect to Common Stock directly beneficially owned by the Reporting Persons listed below:

Name	Number of Shares of Common Stock	Percentage of Outstanding Common Stock
Ivy Healthcare	680,242	3.9%*
Fieldpoint	695,548	4.0%*
Pangia	266,996	1.5%*

*	In the event that the underwriters’ over-allotment option in the Issuer’s initial public offering is exercised and the Reporting Persons do not purchase additional shares sold in the underwriters’ over-allotment option, such percentage will decrease.

Warren Jr. is a principal of Ivy Capital Partners, the General Partner of Ivy Healthcare and is a manager of, and owns a 32.67% partnership interest in, Fieldpoint. Pangia is a principal of Ivy Capital Partners, the General Partner of Ivy Healthcare. Both, Warren Jr. and Pangia may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Common Stock that Ivy Healthcare beneficially owns. Warren Jr. may be deemed to be the indirect beneficial owner (as that term is defined under Rule 13d-3 under the Exchange Act) of the shares of Common Stock that Fieldpoint beneficially owns. Warren Jr. and Pangia have the power to direct the voting and disposition of the shares of Common Stock that Ivy Healthcare beneficially owns. Warren Jr. has the power to direct the voting and disposition of the shares of Common Stock that Fieldpoint beneficially owns.

Beneficial ownership of the Common Stock shown on the cover pages of and set forth elsewhere in this Statement for each member of the Reporting Persons assumes that they have not formed a group for purposes of Section 13(d)(3) under the Exchange Act, and Rule 13d-5(b)(1) promulgated thereunder. If the members of the Reporting Persons were deemed to have formed a group for purposes of Section 13(d)(3) and Rule 13d-5(b)(1), the group would be deemed to own beneficially (and may be deemed to have shared voting and dispositive power over) of 1,642,786 shares of Common Stock, constituting approximately 9.5% of the outstanding shares of Common Stock (the percentage of shares owned being based upon 17,250,000 shares of Common Stock outstanding as of October 9, 2007, as set forth in the Issuer’s audited financials filed as Exhibit 99.1 to its Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 11, 2007, plus 1,800,000 shares issued on October 15, 2007 pursuant to the underwriters’ over-allotment option, as disclosed by the Issuer in its Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 15, 2007). This does not include shares of Common Stock which may be purchased pursuant to the Founders’ Warrants or the Sponsors’ Warrants because such warrants are not exercisable and may not become exercisable within the next 60 days.

The filing of this Statement and any future amendment by the Reporting Persons, and the inclusion of information herein and therein with respect to Warren Jr. and Pangia, shall not be considered an admission that either Warren Jr. or Pangia, for the purpose of Section 16(b) of the Exchange Act, is the beneficial owner of any shares in which he does not have a pecuniary interest.

As a result of the Stockholders Agreement, each of the Kanders Stockholders, and the Ivy Stockholders may be deemed to be a “group” within the meaning of Rule 13d-5 of the Act, and the “group” may be deemed to be the owner of 3,867,200 shares of Common Stock on October 12, 2007, or 22.4% of the total issued and outstanding Common Stock of the Issuer. Each of the Reporting Persons hereby disclaims beneficial ownership of the shares of Common Stock held by the Ivy Stockholders. The filing of this Statement shall not be construed as an admission by any of the Reporting Persons that a “group” exists with the Kanders Stockholders, or that any of the Reporting Persons is a beneficial owner of any securities other than those directly held by them.

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The Reporting Persons have made purchases of the Issuer’s securities during the last 60 days, as follows:

Name	Date	Type	Number	Price
Ivy Healthcare	October 9, 2007	Private	454,545 Sponsors’ Warrants	$1 per Sponsors’ Warrant
Fieldpoint	October 9, 2007	Private	464,773 Sponsors’ Warrants	$1 per Sponsors’ Warrant
Pangia	October 9, 2007	Private	178,409 Sponsors’ Warrants	$1 per Sponsors’ Warrant

(d) and (e). Not Applicable

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Each of the Reporting Persons is a party to a Joint Filing Agreement, dated as of October 16, 2007 (the “13D Joint Filing Agreement”), pursuant to which they agreed to jointly file this Statement and any and all amendments and supplements hereto with the Securities and Exchange Commission. The description of the 13D Joint Filing Agreement in this Item 6 of the Statement is qualified in its entirety by reference to the full text of the 13D Joint Filing Agreement, a copy of which is filed herewith as Exhibit 99.2.

Except for the agreements described in this Statement, to the best knowledge of the Reporting Persons, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between the Reporting Persons, and any other person, with respect to any securities of the Issuer, including, but not limited to, transfer or voting of any of the securities, finder’s fees, joint ventures, loan or option agreements, puts or calls, guarantees of profits, divisions of profits or loss, or the giving or withholding of proxies.

Item 7. Material to be Filed as Exhibits

The following exhibit is filed as part of this Statement:

Exhibit 99.1

Stockholders Agreement dated as of October 2, 2007.

Exhibit 99.2

Joint Filing Agreement dated as of October 17, 2007.

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SIGNATURE

After reasonable inquiry and to the best of their knowledge and belief, the undersigned certify that the information set forth in this Statement is true, complete and correct.

Dated: October 17, 2007

		IVY HEALTHCARE CAPITAL II, L.P.

		By:	/s/ Robert W. Pangia
		Name:	Robert W. Pangia
		Title:	Manager

		FIELDPOINT CAPITAL, LLC

		By:	/s/ Russell F. Warren, Jr.
		Name:	Russell F. Warren, Jr.
		Title:	Manager

		/s/ Russell F. Warren, Jr.
		Russell F. Warren, Jr., Individually

		/s/ Robert W. Pangia
		Robert W. Pangia, Individually

EX-99.1 2 file2.htm STOCKHOLDERS AGREEMENT

EXHIBIT 99.1

STOCKHOLDERS AGREEMENT

This STOCKHOLDERS AGREEMENT (this “Agreement”), dated as of October 2, 2007, is made by and between Warren B. Kanders (“Kanders”), Highland Equity LLC (“Equity LLC”), Kanders & Company, Inc. (“Kanders Inc.”), Russell F. Warren, Jr. (“Warren”), Fieldpoint Capital, LLC (“Fieldpoint”), Robert W. Pangia (“Pangia”), Ivy Healthcare Capital II, L.P. (“Ivy”), Dennis W. O’Dowd (“O’Dowd”) and Virgilio Rene Veloso (“Veloso”, and collectively with Kanders, Equity LLC, Kanders Inc., Warren, Fieldpoint, Pangia, Ivy and O’Dowd, the “Stockholders” and each a “Stockholder”), with respect to shares of Stock (as hereinafter defined) of Highlands Acquisition Corp., a Delaware corporation (the “Company”).

W I T N E S S E T H :

WHEREAS, each of the Stockholders is the record and beneficial owner of, has voting control of, and/or has subscribed to purchase, the number of issued and outstanding, or to be issued and outstanding, shares of Stock of the Company set forth opposite such Stockholder’s name on Schedule A hereto; and

WHEREAS, each of the Stockholders desires to provide reasonable restrictions upon the transfer of the Stock and to agree to vote his shares in accordance with the provisions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agrees as follows:

Certain Definitions.

For purposes of this Agreement, the following terms shall have the meanings indicated:

“Affiliate” of any party shall mean (i) any other party who, directly or indirectly, is in control of, is controlled by or is under common control with such first party; (ii) any party who is a director, executive officer or partner of such first party or any party described in clause (i) above; or (iii) any party who is an immediate family member of such party or a trust for the benefit of such family member.

“Co-Investment Subscription Agreements” shall mean the subscription agreements between the Company and each Stockholder, respectively, pursuant to which the Stockholders severally subscribed and agreed to purchase an aggregate of 1,000,000 units, with each unit consisting of one share of Common Stock and one warrant to purchase one-share of Common Stock at $7.50 per share (the “Co-Investment Units”), for an aggregate purchase price of $10,000,000 in a private placement of such units to be conducted by the Company immediately prior to the consummation of the Initial Business Combination (as defined below).

“Common Stock” shall mean the common stock, par value $.0001 per share, of the Company.

“Founders Unit” shall have the meaning as set forth in Article IV of this Agreement.

“Initial Business Combination” shall mean the first acquisition, through merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar transaction by the Company of another business occurring after the initial public offering of the Company.

“IPO” shall mean the initial public offering by the Company of units (each a “Unit”), with each Unit consisting of one share of Common Stock and one warrant to purchase one share of Common Stock, with a per Unit price of $10.00 and aggregate gross proceeds to the Company of at least $100,000,000.

“Ivy Representative” shall mean Warren or, in the event of the death of Warren, such individual appointed by a majority of the Ivy Stockholders.

“Ivy Stockholders” shall mean, collectively, Warren, Fieldpoint, Pangia, Ivy, O’Dowd and Veloso.

“Kanders Representative” shall mean Kanders or, in the event of the death of Kanders, such individual appointed by a majority of the Kanders Stockholders.

“Kanders Stockholders” shall mean, collectively, Kanders, Equity LLC and Kanders Inc.

“Sponsors’ Warrants” shall mean the warrants to purchase an aggregate of 3,250,000 shares of Common Stock, at an exercise price of $7.50 per share, for an aggregate purchase price of $3,250,000 for which the Stockholders have severally subscribed and agreed to purchase, simultaneously with the consummation of the IPO, pursuant to subscription agreements between the Company and each Stockholder party thereto.

“Stock” or “Shares” shall mean (i) the Founders Units (including the underlying securities), (ii) the Sponsors’ Warrants (including the underlying securities), (iii) any shares of Common Stock issuable upon conversion or exercise of any of the foregoing or pursuant to a distribution by the Company in respect of shares of Common Stock underlying any of the foregoing, and (iv) any other capital stock of any class or classes of the Company issued in exchange for, or in respect of, any of the foregoing outstanding at any time, the holders of which are entitled, in the absence of contingencies, to vote for the election of directors of the Company, and on any matter presented to the stockholders of the Company for their vote or approval. For avoidance of doubt, for purposes of this Agreement “Stock” or “Shares” shall not include any

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Co-Investment Units (including the underlying securities) and any Units (including the underlying securities) acquired by a Stockholder or its Affiliates in the IPO.

“Transfer” shall mean any voluntary or involuntary, direct or indirect, pledge, hypothecation, gift, donation, conveyance, assignment, mortgage, encumbrance, sale, granting of an option with respect to, or other disposition, to anyone, whether or not he is then a Stockholder.

“Transferred” shall mean any change in ownership by means of a Transfer.

II.

Restrictions on Transfer.

(a) An Ivy Stockholder shall not Transfer any Shares, except: (i) in compliance with the terms and conditions of this Agreement; (ii) with the prior written consent of the Kanders Representative, which consent may be withheld in the sole discretion of the Kanders Representative and provided that, if the Kanders Representative consents to such Transfer, the Kanders Stockholders shall thereupon be permitted to Transfer, pro rata among the Kanders Stockholders, an equal number of Shares to any third party; (iii) to an Affiliate of such Stockholder or an officer or director of the Company, provided that such Affiliate or officer or director agrees to be bound by the terms of this Agreement; (iv) to another Ivy Stockholder or (v) to a customary margin brokerage account maintained by such Stockholder or in pledge to a commercial lender pursuant to a bona fide, arms-length pledge agreement for the provision of credit. Any other purported Transfer shall be void and shall not be recognized by the Stockholders, and no purported transferee shall be entitled to vote any of such Shares, nor receive any dividends, profits or other distributions in respect thereof, nor shall any purported transferee have any other rights as a Stockholder.

(b) A Kanders Stockholder shall not Transfer any Shares, except: (i) in compliance with the terms and conditions of this Agreement; (ii) with the prior written consent of the Ivy Representative, which consent may be withheld in the sole discretion of the Ivy Representative and provided that, if the Ivy Representative consents to such Transfer, the Ivy Stockholders shall thereupon be permitted to Transfer, pro rata among the Ivy Stockholders, an equal number of Shares to any third party; (iii) to an Affiliate of such Stockholder or an officer or director of the Company, provided that such Affiliate or officer or director agrees to be bound by the terms of this Agreement; (iv) to another Kanders Stockholder or (v) to a customary margin brokerage account maintained by such Stockholder or in pledge to a commercial lender pursuant to a bona fide, arms-length pledge agreement for the provision of credit. Any other purported Transfer shall be void and shall not be recognized by the Stockholders, and no purported transferee shall be entitled to vote any of such Shares, nor receive any dividends, profits or other distributions in respect thereof, nor shall any purported transferee have any other rights as a Stockholder.

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III.

Death of a Stockholder

Upon the death of a Stockholder who is a natural person (hereinafter called the “Deceased Stockholder”), the personal representative(s) of his estate shall be permitted to Transfer the Shares owned by the Deceased Stockholder at the time of his death free of all restrictions of this Agreement and, in such case, the other Stockholders (whether or not natural persons) shall thereupon be permitted to Transfer an equal number of Shares to any third party free of all restrictions of this Agreement; provided, that, if the Deceased Stockholder shall have made a testamentary bequest, the transferees of such bequest shall have agreed to be bound by the terms of this Agreement, which shall remain in full force and effect as though such transferees were original parties thereto, and, in such case, the other Stockholders (whether or not natural persons) shall thereupon be permitted to Transfer an equal number of Shares to any third party as long as such third party shall have agreed to be bound by the terms of this Agreement.

IV.

Default under Co-Investment Subscription Agreements.

(a) Default by an Ivy Stockholder.

(i) In the event that an Ivy Stockholder (an “Ivy Defaulting Stockholder”) fails for any reason to consummate the purchase of any of the Co-Investment Units contemplated by its respective Co-Investment Subscription Agreement, the other Ivy Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Ivy Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. In the event that the other Ivy Stockholders purchase all of the Co-Investment Units that were subscribed for by the Ivy Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Ivy Defaulting Stockholder, the Ivy Defaulting Stockholder shall transfer and deliver to such other Ivy Stockholders all of the units (each a “Founders Unit”) consisting of one “founders” share of Stock and one “founders” warrant beneficially owned by the Ivy Defaulting Stockholder, as reflected on Schedule A attached hereto, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units to such other Ivy Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each of the other Ivy Stockholders) in consideration of such other Ivy Stockholders paying $0.01 for each Founders Unit transferred.

(ii) In the event that the Ivy Defaulting Stockholder purchases a portion of the Co-Investment Units that it subscribed for pursuant to its Co-Investment Subscription Agreement, the other Ivy Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the remaining Co-Investment Units not purchased by the Ivy Defaulting Stockholder. In the event that the other Ivy Stockholders purchase all of the remaining Co-Investment Units that were subscribed for by the Ivy Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Ivy Defaulting Stockholder,

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the Ivy Defaulting Stockholder shall transfer and deliver to the other Ivy Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each of the other Ivy Stockholders), in consideration of the other Ivy Stockholder paying $0.01 for each Founders’ Unit so transferred, that number of the Founders Units beneficially owned by the Ivy Defaulting Stockholder, as reflected on Schedule A attached hereto, multiplied by a fraction, the numerator of which equals the number of Co-Investment Units that the Ivy Defaulting Stockholder failed to purchase pursuant to its Co-Investment Subscription Agreement and the denominator of which equals the total number of Co-Investment Units subscribed for by the Ivy Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units.

(iii) In the event that an Ivy Defaulting Stockholder fails for any reason to consummate the purchase of any of the Co-Investment Units contemplated by its respective Co-Investment Subscription Agreement and the other Ivy Stockholders decline to purchase such Co-Investment Units, the Kanders Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Ivy Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. In the event that the Kanders Stockholders purchase all of the Co-Investment Units that were subscribed for by the Ivy Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Ivy Defaulting Stockholder, the Ivy Defaulting Stockholder shall transfer and deliver to the Kanders Stockholders all of the Founders Units beneficially owned by the Ivy Defaulting Stockholder, as reflected on Schedule A attached hereto, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units to the Kanders Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each Kanders Stockholder) in consideration of such the Kanders Stockholders paying $0.01 for each Founders Unit transferred.

(iv) In the event that the Ivy Defaulting Stockholder purchases a portion of the Co-Investment Units that it subscribed for pursuant to its Co-Investment Subscription Agreement and the other Ivy Stockholders decline to purchase all, but not less than all, of the remaining Co-Investment Units not purchased by the Ivy Defaulting Stockholder, the Kanders Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Ivy Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. If the Kanders Stockholder do so purchase such Co-Investment Units, the Ivy Defaulting Stockholder shall transfer and deliver to the Kanders Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each of the Kanders Stockholders), in consideration of the Kanders Stockholders paying $0.01 for each Founders’ Unit so transferred, that number of the Founders Units beneficially owned by the Ivy Defaulting Stockholder, as reflected on Schedule A attached hereto, multiplied by a fraction, the numerator of which equals the number of Co-Investment Units that the Ivy Defaulting Stockholder failed to purchase pursuant to its Co-Investment Subscription Agreement and the denominator of which equals the total number of Co-Investment Units subscribed for by the Ivy

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Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units.

(b) Default by a Kanders Stockholder.

(i) In the event that any Kanders Stockholder (a “Kanders Defaulting Stockholder”) fails for any reason to consummate the purchase of any of the Co-Investment Units contemplated by its Co-Investment Subscription Agreement, the other Kanders Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Kanders Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. In the event that the other Kanders Stockholders purchase all of the Co-Investment Units that were subscribed for by the Kanders Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Kanders Defaulting Stockholder, Equity LLC shall not be required to transfer and deliver to such other Kanders Stockholders any Founders Unit beneficially owned by Equity LLC.

(ii) In the event that the Kanders Defaulting Stockholder purchases a portion of the Co-Investment Units that it subscribed for pursuant to its Co-Investment Subscription Agreement, the other Kanders Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the remaining Co-Investment Units not purchased by the Kanders Defaulting Stockholder. In the event that the other Kanders Stockholders purchase all of the remaining Co-Investment Units that were subscribed for by the Kanders Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Kanders Defaulting Stockholder, Equity LLC shall not be required to transfer and deliver to such other Kanders Stockholders any Founders Unit beneficially owned by Equity LLC.

(iii) In the event that the Kanders Defaulting Stockholder fails for any reason to consummate the purchase of any of the Co-Investment Units contemplated by its Co-Investment Subscription Agreement and the other Kanders Stockholders decline to purchase such Co-Investment Units, the Ivy Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Kanders Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. In the event that the Ivy Stockholders purchase all of the Co-Investment Units that were subscribed for by the Kanders Defaulting Stockholder in its Co-Investment Subscription Agreement and not purchased by the Kanders Defaulting Stockholder or the other Kanders Stockholders, the Kanders Stockholders shall transfer and deliver to the Ivy Stockholders all of the Founders Units beneficially owned by the Kanders Stockholders, as reflected on Schedule A attached hereto, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units to the Ivy Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each Ivy Stockholder) in consideration of the Ivy Stockholders paying $0.01 for each Founders Unit transferred.

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(iv) In the event that the Kanders Defaulting Stockholder purchases a portion of the Co-Investment Units that it subscribed for pursuant to its Co-Investment Subscription Agreement and the other Kanders Stockholders decline to purchase all, but not less than all, of the remaining Co-Investment Units not purchased by the Kanders Defaulting Stockholder, the Ivy Stockholders shall have the option, but not the obligation, to purchase all, but not less than all, of the Co-Investment Units that were not purchased by the Kanders Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement. If the Ivy Stockholders do so purchase such Co-Investment Units, the Kanders Stockholders shall transfer and deliver to the Ivy Stockholders (in proportion to the percentage of the Co-Investment Units so purchased by each of the Ivy Stockholders), in consideration of the Ivy Stockholders paying $0.01 for each Founders’ Unit so transferred, that number of the Founders Units beneficially owned by the Kanders Stockholders (in the aggregate), as reflected on Schedule A attached hereto, multiplied by a fraction, the numerator of which equals the number of Co-Investment Units that the Kanders Defaulting Stockholder failed to purchase pursuant to its Co-Investment Subscription Agreement and the denominator of which equals the total number of Co-Investment Units subscribed for by the Kanders Defaulting Stockholder pursuant to its Co-Investment Subscription Agreement, together with duly executed stock powers and all other documentation reasonably required to transfer good title and beneficial ownership of such Founders Units.

Election of Directors

(a) The Kanders Representative and the Ivy Representative shall each have the option, but not the obligation, to propose one director to the nominating committee of the Company’s Board of Directors for nomination as a candidate for election to the Board of Directors of the Company. In the event that all candidates proposed for nomination by the Kanders Representative and the Ivy Representative, as applicable, are nominated for election by the nominating committee of the Company’s Board of Directors, each Stockholder agrees (subject to any existing fiduciary duties of such Stockholder) to vote all shares of Stock beneficially owned or held of record by such Stockholder and shares of Stock as to which he has voting control, as set forth on Schedule A, and agrees to use his reasonable best efforts to cause his Affiliates to vote, at any regular or special meeting of the stockholders of the Company called for the purpose of filling positions on the Board of Directors, or in any written consent executed in lieu of such a meeting, for the respective nominees of the Kanders Representative and the Ivy Representative. Each director shall serve until the next meeting of stockholders of the Company at which directors in each such director’s class are to be elected, or until a successor to such director shall have been selected as provided in this Agreement.

(b) If a director nominated by the Kanders Representative or the Ivy Representative dies, resigns or is removed as a director and there is a resulting vacancy in the Board of Directors of the Company and the Kanders Representative or the Ivy Representative, as applicable, proposes a substitute candidate to the nominating committee of the Company’s Board of Directors to fill such vacancy and such substitute candidate is nominated by the nominating committee of the Company’s Board of Directors for election to the Board of Directors of the

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Company, each Stockholder agrees to vote all shares of Stock owned by such Stockholder to elect such substitute candidate nominated by the Kanders Representative or the Ivy Representative, as applicable.

VI.

Representations and Warranties.

(a)

Stock Ownership.

Each Stockholder severally represents and warrants to the other party to this Agreement that he is the record and beneficial owner of, has voting control of, and/or has subscribed to purchase, the number of shares of Stock set forth opposite his name on Schedule A, and that, except as permitted pursuant to Article II hereof or those created by this Agreement, the shares of Stock that are owned by him or his Affiliates are free and clear of all liens, security interests, pledges, charges, encumbrances, stockholders agreements, and voting trusts. Each Stockholder agrees promptly to notify the other party to this Agreement of the occurrence and circumstances of any event which would make the repetition at any future time of the above representation and warranty untrue as to him. Each Stockholder severally represents and warrants to the other party to this Agreement that he has, or will have upon purchase, voting control, whether by proxy or voting agreement of the number of shares of Stock set forth opposite his name on Schedule A and attached hereto as Exhibit A are true, complete and accurate copies of each such proxy or voting agreement, if any.

(b)

Authority.

Each Stockholder severally represents and warrants to the other party to this Agreement that (i) such Stockholder has full power and authority to execute and deliver this Agreement and to carry out the provisions of this Agreement, (ii) this Agreement has been duly executed and delivered by such Stockholder and is a legal, valid and binding obligation of such Stockholder and (iii) the execution and delivery of this Agreement will not violate or be in conflict with any order, judgment, injunction, agreement or controlling document to which such Stockholder is a party or by which he or the Shares is bound.

VII.

Termination.

This Agreement shall automatically terminate upon the earlier to occur of any of the following events (the “Termination Date”):

(a)

the third anniversary of the consummation of the Initial Business Combination;

(b)

the liquidation or dissolution of the Company;

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(c)

the sale of all or substantially all of the assets, the sale of all or substantially all of the outstanding capital stock of the Company by the holders thereof, or any merger, consolidation, reorganization or similar business combination of the Company pursuant to which the Company is not the surviving entity or the stockholders of the Company immediately before such transaction or series of related transactions own less than fifty percent (50%) of the voting power of the surviving (or consolidated) entity immediately after such transaction; or

(d)

mutual agreement of the Kanders Representative and the Ivy Representative.

VIII.

Miscellaneous.

8.01

Legend.

The following legends shall be noted conspicuously on all certificates representing shares of Stock heretofore or hereafter issued which are subject to the terms of this Agreement:

“THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER AND VOTING, AS PROVIDED IN A STOCKHOLDERS AGREEMENT, DATED AS OF OCTOBER 2, 2007 AMONG CERTAIN HOLDERS OF STOCK OF THE COMPANY.”

8.02

Further Actions.

At any time and from time to time, each party agrees, at its or his expense, to take such actions and to execute and deliver such documents as may be reasonably necessary to effectuate the purposes of this Agreement.

8.03

Availability of Equitable Remedies.

A breach of the provisions of this Agreement cannot adequately be compensated by money damages. Any party shall be entitled, in addition to any other right or remedy available to him, to seek such equitable relief as may be granted by a court of competent jurisdiction, including obtaining an injunction, restraining such breach or a threatened breach and to specific performance of any such provision of this Agreement. In any such case no bond or other security shall be required in connection therewith.

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8.04

Modification.

This Agreement sets forth the entire understanding of the parties with respect to the subject matter hereof, supersedes all prior negotiations, understandings and existing agreements among them concerning such subject matter which are merged herein, and may be modified only by a written instrument duly executed by all of the parties.

8.05

Notices.

Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be mailed by certified mail, return receipt requested, or delivered by facsimile transmission with proof of receipt, nationally recognized overnight courier service, or delivered personally against receipt to the party to whom it is to be given, at the address or facsimile number of such party set forth in Schedule A to this Agreement. Notices to the estate of a Stockholder shall be sufficient if addressed to the Stockholder as provided in this Section 8.05. Except as otherwise specifically provided in this Agreement, any notice given by certified mail shall be deemed given on the second business day following certification thereof, any notice given by facsimile transmission shall be deemed given upon transmission thereof if accompanied by a confirmation of such transmission, any notice given by overnight courier service shall be deemed given on the next business day, and any notice delivered personally shall be deemed given upon such delivery if accompanied by a receipt thereof, except for a notice changing a party’s address which shall be deemed given at the time of receipt thereof.

8.06

Waiver.

Any waiver by any party of a breach of any provision of this Agreement shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Agreement. The failure of a party to insist upon strict adherence to any term of this Agreement on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement. Any waiver must be in writing.

8.07

Binding Effect.

The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, heirs, and personal representatives. If a Stockholder has Transferred all of his shares of Stock, he shall thereafter be deemed not to be a party to this Agreement or to have any rights hereunder.

8.08

No Third Party Beneficiaries.

This Agreement does not create, and shall not be construed as creating, any rights enforceable by any person not a party to this Agreement (except as provided in Section 8.07).

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8.09

Severability.

If any provision of this Agreement is invalid, illegal, or unenforceable, the balance of this Agreement shall remain in effect, and if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and circumstances.

8.10

Headings.

The headings in this Agreement are solely for convenience of reference and shall be given no effect in the construction or interpretation of this Agreement.

8.11

Pronouns.

Any masculine personal pronoun shall be considered to mean the corresponding feminine or neuter personal pronoun, as the context requires.

8.12

Counterparts.

This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

8.13

Governing Law

This Agreement shall be governed by and construed according to the laws of the State of New York, without regard to the conflict of laws provisions thereof. The parties hereto hereby irrevocably and unconditionally submit to the exclusive jurisdiction of any State or Federal court sitting in the County of New York, State of New York over any suit, action or proceeding arising out of or relating to this Agreement. The parties hereby agree that service of any process, summons, notice or document by registered mail addressed to any such party shall be effective service of process for any action, suit or proceeding brought against a party in any such court. The parties hereto hereby irrevocably and unconditionally waive any objection to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. The parties hereto agree that a final judgment in any such suit, action or proceeding brought in any such court shall be conclusive and binding upon any party and may be enforced in any other courts to whose jurisdiction any party is or may be subject, by suit upon such judgment.

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8.14

No Transfer Valid Except Under Agreement.

No Shares covered or affected by this Agreement shall be transferred on the books of the Company except upon full compliance with the terms of this Agreement.

[Signature page follows]

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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first written above.

		/s/ Warren B. Kanders
		Warren B. Kanders
		HIGHLAND EQUITY LLC
		By:	/s/ Warren B. Kanders
		Name:	Warren B. Kanders
		Title:	Non-member Manager

		KANDERS & COMPANY, INC.
		By:	/s/ Warren B. Kanders
		Name:	Warren B. Kanders
		Title:	President

		/s/ Russell F. Warren, Jr.
		Russell F. Warren, Jr.
		FIELDPOINT CAPITAL, LLC
		By:	/s/ Russell F. Warren, Jr.
		Name:	Russell F. Warren, Jr.
		Title:	Manager

		/s/ Robert W. Pangia
		Robert W. Pangia

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		IVY HEALTHCARE CAPITAL II, L.P.
		By:	/s/ Robert W. Pangia
		Name:	Robert W. Pangia
		Title:	Co-Manager

		/s/ Dennis W. O’Dowd
		Dennis W. O’Dowd

		/s/ Virgilio Rene Veloso
		Virgilio Rene Veloso

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Schedule A

List of Names and Holdings of Stockholders

Name

Number of
Founders
Units

Number of
Subscribed
for Sponsors’
Warrants

Number of
Subscribed
for Co-
Investment
Units

Shares of
Stock
Beneficially
Owned

Shares of
Stock subject
to Voting
Control

Warren B. Kanders

Address:

c/o Kanders & Company, Inc., One Landmark Square, 22^nd Floor, Stamford, CT 06901

Fax: (203) 552-9607

1,683,600¹

Highland Equity LLC

Address:

c/o Kanders & Company, Inc., One Landmark Square, 22^nd Floor, Stamford, CT 06901

Fax: (203) 552-9607

1,683,600²

1,683,600³

0⁴

______________

¹ Represents 1,683,600 shares of common stock, par value $.0001 per share (the “Common Stock”), of the Company held by Highland Equity LLC. Includes up to 219,600 shares of Common Stock that are subject to forfeiture to the extent that the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include 1,683,600 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Highland Equity LLC. Does not include (i) 2,125,000 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Kanders & Company, Inc., (ii) 500,000 shares of Common Stock included in the Co-Investment Units subscribed for by Kanders & Company, Inc. and (iii) 500,000 shares of Common Stock issuable upon exercise of warrants included in the Co-Investment Units subscribed for by Kanders & Company, Inc.

² Includes up to 219,600 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

³ Includes up to 219,600 shares of Common Stock that are subject to forfeiture to the extent that the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include 1,683,600 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Highland Equity LLC.

⁴ Warren B. Kanders, the Non-member manager of Highland Equity LLC, has voting and dispositive power over the shares of Common Stock held by Highland Equity LLC.

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Name

Number of
Founders
Units

Number of
Subscribed
for Sponsors’
Warrants

Number of
Subscribed
for Co-
Investment
Units

Shares of
Stock
Beneficially
Owned

Shares of
Stock subject
to Voting
Control

Kanders & Company, Inc.

Address:

One Landmark Square, 22^nd Floor,

Stamford, CT 06901

Fax: (203) 552-9607

2,125,000

500,000

0⁵

0⁶

Russell F. Warren, Jr.

Address:

c/o Ivy Capital Partners

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

1,375,790⁷

______________

⁵ Does not include 2,125,000 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Kanders & Company, Inc. Does not include 500,000 shares of Common Stock and 500,000 shares of Common Stock issuable upon exercise of warrants included in the Co-Investment Units subscribed for by Kanders & Company, Inc.

⁶ Warren B. Kanders, the President and principal stockholder of Kanders & Company, Inc., would have voting and dispositive power over the shares of Common Stock held by Kanders & Company, Inc.

⁷ Represents 695,548 shares of Common Stock held by Fieldpoint Capital, L.L.C. and 680,242 shares of Common Stock held by Ivy Healthcare Capital II, L.P. Includes up to 90,724 shares of Common Stock held by Fieldpoint Capital, L.L.C. and up to 88,727 shares of Common Stock held by Ivy Healthcare Capital II, L.P. that are subject to forfeiture to the extent that the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 695,548 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Fieldpoint Capital, L.L.C., (ii) 680,242 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Ivy Healthcare Capital II, L.P., (iii) 464,773 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Fieldpoint Capital, L.L.C., (iv) 454,545 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Ivy Healthcare Capital, L.P., (v) 206,565 shares of Common Stock and 206,565 shares of Common Stock issuable upon exercise of warrants included in the Co-Investment Units subscribed for by Fieldpoint Capital, L.L.C. and (vi) 202,020 shares of Common Stock and 202,020 shares of Common Stock issuable upon exercise of warrants included in the Co-investment Units subscribed for by Ivy Healthcare Capital II, L.P.

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Name

Number of
Founders
Units

Number of
Subscribed
for Sponsors’
Warrants

Number of
Subscribed
for Co-
Investment
Units

Shares of
Stock
Beneficially
Owned

Shares of
Stock subject
to Voting
Control

Fieldpoint Capital, L.L.C.

Address:

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

695,548⁸

464,773

206,565

695,548⁹

0¹⁰

Robert W. Pangia

Address:

c/o Ivy Capital Partners

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

266,996¹¹

178,409

79,293

266,996¹²

______________

⁸ Includes up to 90,724 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

⁹ Includes up to 90,724 shares of Common Stock that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 695,548 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Fieldpoint Capital, L.L.C., (ii) 464,773 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Fieldpoint Capital, L.L.C. and (iii) 206,565 shares of Common Stock and 206,565 shares of Common Stock issuable upon exercise of warrants included in the Co-Investment Units subscribed for by Fieldpoint Capital, L.L.C.

¹⁰ Russell F. Warren, Jr. has voting and dispositive power over the shares of Common Stock held by Fieldpoint Capital, L.L.C.

¹¹ Includes up to 34,826 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

¹² Includes up to 34,826 shares of Common Stock that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 266,996 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Robert W. Pangia, (ii) 178,409 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Robert W. Pangia and (iii) 79,293 shares of Common Stock and 79,293 shares of Common Stock issuable upon exercise of warrants included in the Co-Investment Units subscribed for by Robert W. Pangia.

-17-

Name

Number of
Founders
Units

Number of
Subscribed
for Sponsors’
Warrants

Number of
Subscribed
for Co-
Investment
Units

Shares of
Stock
Beneficially
Owned

Shares of
Stock subject
to Voting
Control

Ivy Healthcare Capital II, L.P.

Address:

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

680,242¹³

454,545

202,020

680,242¹⁴

0¹⁵

Dennis W. O’Dowd

Address:

c/o Ivy Capital Partners

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

27,209¹⁶

18,182

8,081

27,209¹⁷

______________

¹³ Includes up to 88,727 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

¹⁴ Includes up to 88,727 shares of Common Stock that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 680,242 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Ivy Healthcare Capital II, L.P., (ii) 454,545 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Ivy Healthcare Capital, L.P. and (iii) 202,020 shares of Common Stock and 202,020 shares of Common Stock issuable upon exercise of warrants included in the Co-investment Units subscribed for by Ivy Healthcare Capital II, L.P.

¹⁵ Russell F. Warren, Jr. has voting and dispositive power over the shares of Common Stock held by Ivy Healthcare Capital, L.P.

¹⁶ Includes up to 3,549 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

¹⁷ Includes up to 3,549 shares of Common Stock that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 27,209 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Dennis W. O’Dowd, (ii) 18,182 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Dennis W. O’Dowd and (iii) 8,081 shares of Common Stock and 8,081 shares of Common Stock issuable upon exercise of warrants included in the Co-investment Units subscribed for by Dennis W. O’Dowd.

-18-

Name

Number of
Founders
Units

Number of
Subscribed
for Sponsors’
Warrants

Number of
Subscribed
for Co-
Investment
Units

Shares of
Stock
Beneficially
Owned

Shares of
Stock subject
to Voting
Control

Virgilio Rene Veloso

Address:

c/o Ivy Capital Partners

One Paragon Drive

Suite 125

Montvale, NJ 07645

Fax:________________

13,605¹⁸

9,091

4,041

13,605¹⁹

______________

¹⁸ Includes up to 1,775 Founders Units that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised.

¹⁹ Includes up to 1,775 shares of Common Stock that are subject to forfeiture to the extent the underwriters over-allotment option in the Company’s initial public offering is not exercised in full or expires unexercised. Does not include (i) 13,605 shares of common stock issuable upon exercise of warrants included in the Founders Units held by Virgilio Rene Veloso, (ii) 9,091 shares of Common Stock issuable upon exercise of the Sponsors’ Warrants subscribed for by Virgilio Rene Veloso and (iii) 4,041 shares of Common Stock and 4,041 shares of Common Stock issuable upon exercise of warrants included in the Co-investment Units subscribed for by Virgilio Rene Veloso.

-19-

Exhibit A

Copies of Proxies and/or Voting Agreements

-20-

EX-99.2 3 file3.htm JOINT FILING AGREEMENT

Exhibit 99.2

JOINT FILING AGREEMENT

THIS JOINT FILING AGREEMENT (this “Agreement”) is made and entered into as of this 17th day of October, 2007, by and among Ivy Healthcare Capital II, L.P., a Delaware limited partnership, Fieldpoint Capital, LLC, a Delaware limited liability company, Mr. Russell F. Warren, Jr., and Mr. Robert W. Pangia.

The parties to this Agreement hereby agree to prepare jointly and file timely (or otherwise to deliver as appropriate) all filings on Schedule 13D and Schedule 13G (the “Filings”) required to be filed by them pursuant to Section 13(d) or 13(g) under the Securities Exchange Act of 1934, as amended, with respect to their respective ownership of the Common Stock of Highlands Acquisition Corp. that are required to be reported on any Filings. Each party to this Agreement further agrees and covenants to the other parties that it will fully cooperate with such other parties in the preparation and timely filing (and other delivery) of all such Filings.

[signature pages follow]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

		IVY HEALTHCARE CAPITAL II, L.P.
		By:	/s/ Robert W. Pangia
		Name:	Robert W. Pangia
		Title:	Manager

		FIELDPOINT CAPITAL, LLC
		By:	/s/ Russell F. Warren, Jr.
		Name:	Russell F. Warren, Jr.
		Title:	Manager

		Russell F. Warren, Jr.
		Russell F. Warren, Jr., Individually

		Robert W. Pangia
		Robert W. Pangia, Individually

Signature page to Joint Filing Agreement

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