Orchid Island Capital, Inc. managed by Bimini Advisors, Inc entered into an agreement and plan of reorganization to acquire FlatWorld Acquisition Corp. (OTCPK:FWLA.F) from FWAC Holdings Limited, Fir Tree Partners L.P., AQR Capital Management, LLC, Polar Securities Inc., and Bulldog Investors in a reverse merger transaction on July 26, 2012. Orchid Island is the accounting acquirer in the transaction. Bimini Capital, parent company of Orchid Island, will be issued 0.14 million shares of class A preferred shares of FlatWorld convertible into 1.4 million ordinary shares of FlatWorld valued at approximately $14.4 million. The preferred shares are convertible into ordinary shares on a one-for-ten basis any time after the record date for the post-merger dividend. The terms of the transaction are subject to amendments and the consideration is subject to adjustments. Upon consummation of the deal, Bimini Capital will also contribute $1.7 million in cash to FlatWorld. A part of the consideration, 0.01 million preferred shares will be deposited in escrow and subject to an escrow agreement to be entered into at the closing of the Merger. Upon the consummation of the deal, the separate existence of Orchid Island shall cease. Upon closing of the transaction, FlatWorld will change its name to Orchid Island Holding, Inc.

Pursuant to the terms, as designated by Bimini Capital, the Board of Directors of FlatWorld is expected to consist of Robert E. Cauley, G. Hunter Haas, IV, W. Coleman Bitting, John B. Van Heuvelen, Frank P. Filipps, and Ava L. Parker. Robert E. Cauley is expected to initially serve as the Chairman of the Board of FlatWorld and the manager of Orchid Island, until his resignation or removal. Additionally, following the completion of the deal, the Board of Directors of FlatWorld shall establish such committees as the then Board of Directors of FlatWorld shall determine. Upon closing, Robert E. Cauley will be appointed as President and Chief Executive Officer, G. Hunter Haas, IV, as Secretary, Chief Financial Officer and Chief Investment Officer, and Jerry Sintes, as Vice President and Treasurer. The transaction is conditioned upon FlatWorld having completed the tender offer, where in FlatWorld will repurchase from FWAC Holdings all 0.57 million of FlatWorld's issued and outstanding ordinary shares. It is also subject to the applicable waiting period under any antitrust laws, authorizations, approvals and permits from, any governmental authority or regulatory agency; the Board of Directors, the board of managers and the officers of FlatWorld and shall be constituted; the ordinary shares, the units and the warrants shall be quoted on the OTC bulletin board; FlatWorld shall have amended its Charter pursuant to the BVI Business Companies Act of 2004, as amended to reflect a new corporate name not using the term “FlatWorld”. FlatWorld's sponsor shall have received the lock-up agreement called for in the Agreement and Plan of Reorganization, duly executed by Bimini Capital and FlatWorld shall have executed the Registration Rights Agreement. FlatWorld's closing date balance sheet shall be prepared within 30 calendar days of the closing date and, BDO USA, LLP will be engaged to perform an audit.

As of August 20, 2012, FlatWorld Acquisition Corp. announced that the tender offer originally scheduled to expire on August 24, 2012 has been extended till August 30, 2012. As of August 20, 2012, a total of 0.12 million of FlatWorld's ordinary shares had been tendered and not withdrawn which represent approximately 5.1% of the ordinary shares held by its public shareholders. If more than 0.83 million ordinary shares are validly tendered and not properly withdrawn, FlatWorld will terminate or extend the tender offer. If FlatWorld terminates the tender offer, it will not (i) purchase any ordinary shares pursuant to the tender offer or (ii) consummate the merger with Orchid Island. FlatWorld has to consummate the merger with Orchid Island till September 9, 2012 otherwise FlatWorld (i) will distribute the cash in its trust account, pro rata, to its public shareholders by way of redemption and (ii) intends to cease all operations except for the purposes of any winding up of its affairs.

As of August 30, 2012, FlatWorld Acquisition Corp. announced that the tender offer scheduled to expire on August 30, 2012 has been extended till September 6, 2012. As of August 30, 2012, 1,459,526 ordinary shares have been validly tendered and not properly withdrawn.

Daniel M. LeBey of Hunton & Williams LLP acted as legal advisor for Orchid Island and Bimini. Douglas S. Ellenoff of Ellenoff Grossman & Schole LLP acted as legal advisor for FlatWorld. Continental Stock Transfer & Trust Company, Inc. acted as depository bank and Morrow & Co. acted as information agent for FlatWorld Acquisition Corp. Ellenoff Grossman & Schole LLP was paid an advisory fee of $0.57 million. Moye White LLP acted as legal advisor for Bimini Advisors, Inc.

Orchid Island Capital, Inc. managed by Bimini Advisors, Inc cancelled the acquisition of FlatWorld Acquisition Corp. (OTCPK:FWLA.F) from FWAC Holdings Limited, Fir Tree Partners L.P., AQR Capital Management, LLC, Polar Securities Inc., and Bulldog Investors in a reverse merger transaction on September 9, 2012. The tender offer which was scheduled to expire on September 6, 2012 was terminated and none of the tendered shares were purchased. As a result, the condition to closing the merger was not met and the merger will not be consummated.