INVESTMENT MANAGEMENT TRUST AGREEMENT
Exhibit
10.3
This
Agreement is made as of December 15, 2006 by and between Restaurant Acquisition
Partners, Inc., a Delaware corporation (the “Company”),
and
Continental
Stock Transfer & Trust Company,
a New
York corporation (the “Trustee”).
WHEREAS,
the Company's Registration Statement, No. 333-129316 on Form S-1 (“Registration
Statement”),
for
its initial public offering of securities (“IPO”)
has
been declared effective as of December 14, 2006 by the Securities and Exchange
Commission (“Effective
Date”);
WHEREAS,
concurrently with the IPO the initial stockholders are purchasing an aggregate
of 1,500,000 warrants of the Company for aggregate consideration of $960,000
(the “Insider
Warrants”);
and
WHEREAS,
as described in the Company's Registration Statement, and in accordance with
the
Company's Fourth Amended and Restated Certificate of Incorporation, $19,535,000
of the gross proceeds of the IPO and the Insider Warrants ($22,392,500 if the
underwriter’s over-allotment option is exercised in full) will be delivered to
the Trustee to be deposited and held in a trust account for the benefit of
the
Company and the holders of the Company's common stock, par value $.0001 per
share, issued in the IPO as hereinafter provided (the amount to be delivered
to
the Trustee will be referred to herein as the “Property;”
the
stockholders for whose benefit the Trustee shall hold the Property will be
referred to as the “Public
Stockholders,”
and
the
Public Stockholders and the Company will be referred to together as the
“Beneficiaries”);
and
WHEREAS,
the Company and the Trustee desire to enter into this Agreement to set forth
the
terms and conditions pursuant to which the Trustee shall hold the
Property;
IT
IS
AGREED:
1. Agreements
and Covenants of Trustee.
The
Trustee hereby agrees and covenants:
(a) That
the
recitals above are made a part of this Agreement;
(b) To
hold
the Property in trust for the Beneficiaries in accordance with the terms of
this
Agreement, including the terms of Section 11-51-302(6) of the Colorado Revised
Statutes, in segregated trust accounts (collectively, the “Trust
Account”)
established by the Trustee at JPMorgan Chase and Xxxxxx Xxxxxxx;
(c) To
manage, supervise and administer the Trust Account subject to the terms and
conditions set forth herein;
(d) In
a
timely manner, upon the instruction of the Company, to invest and reinvest
the
Property in any “Government
Security.”
As used
herein, Government Security means any Treasury Xxxx issued by the United States,
having a maturity of one hundred and eighty days or less;
(e) To
collect and receive, when due, all principal and income arising from the
Property, which shall become part of the “Property,”
as such
term is used herein;
(f) To
release to the Company from time to time, upon the instruction of the Company,
interest and other earnings on the Trust Account, up to maximum aggregate amount
of $1,025,000, after giving effect to applicable taxes.
(g) To
notify
the Company of all communications received by it with respect to any Property
requiring action by the Company;
(h) To
supply
any necessary information or documents as may be requested by the Company in
connection with the Company's preparation of the tax returns for the Trust
Account;
(i) To
participate in any plan or proceeding for protecting or enforcing any right
or
interest arising from the Property if, as and when instructed by the Company
to
do so;
(j) To
render
to the Company, at the addresses specified in Section 5(e) of this Agreement,
and to such other person as the Company may instruct, monthly written statements
of the activities of and amounts in the Trust Account reflecting all receipts
and disbursements of the Trust Account; and
(k) To
commence liquidation of the Trust Account only after receipt of and only in
accordance with the terms of a letter (“Termination
Letter”),
in a
form substantially similar to that attached hereto as either Exhibit A or
Exhibit B, signed on behalf of the Company by its Chief Executive Officer,
President, Secretary or Chairman of the Board, and complete the liquidation
of
the Trust Account and distribute the Property in the Trust Account only as
directed in the Termination Letter and the other documents referred to
therein.
2. Agreements
and Covenants of the Company.
The
Company hereby agrees and covenants to:
(a) Give
all
instructions to the Trustee hereunder in writing, signed by the Company's Chief
Executive Officer, President, Secretary or Chairman of the Board. In addition,
except with respect to its duties under paragraph 1(j) above, the Trustee shall
be entitled to rely on, and shall be protected in relying on, any verbal or
telephonic advice or instruction which it in good faith believes to be given
by
any one of the persons authorized above to give written instructions, provided
that the Company shall promptly confirm such instructions in
writing;
(b) Hold
the
Trustee harmless and indemnify the Trustee from and against, any and all
expenses, including reasonable counsel fees and disbursements, or loss suffered
by the Trustee in connection with any action, suit or other proceeding brought
against the Trustee involving any claim, or in connection with any claim or
demand which in any way arises out of or relates to this Agreement, the services
of the Trustee hereunder or the Property or any income earned from investment
of
the Property, except for expenses and losses resulting from the Trustee's breach
of any provision of this Agreement or gross negligence or willful misconduct.
Promptly after the receipt by the Trustee of notice of demand or claim or the
commencement of any action, suit or proceeding, pursuant to which the Trustee
intends to seek indemnification under this paragraph, it shall notify the
Company in writing of such claim (hereinafter referred to as the “Indemnified
Claim”),
and
the Company shall have no liability for any Indemnified Claim to the extent
prejudiced by the failure of the Trustee to give notice promptly. The Trustee
shall have the right to conduct and manage the defense against such Indemnified
Claim, provided, that the Trustee shall obtain the prior written consent of
the
Company with respect to both the selection of counsel and the settlement of
any
claim, which consent shall not be unreasonably withheld. The Company may
participate in such action with its own counsel; and
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(c) Pay
the
Trustee an initial acceptance fee of $1,000 and an annual fee of $1,200 (it
being expressly understood that the Property shall not be used to pay such
fee).
The Company shall pay the Trustee the initial acceptance fee and first year's
fee at the consummation of the IPO and thereafter on the anniversary of the
Effective Date. The Trustee shall refund to the Company the fee (on a pro rata
basis) with respect to any period after the liquidation of the Trust Fund.
The
Company shall not be responsible for any other fees or charges of the Trustee
except as may be provided in paragraph 2(b) hereof (it being expressly
understood that the Property shall not be used to make any payments to the
Trustee under such paragraph).
3. Limitations
of Liability.
The
Trustee shall have no responsibility or liability to:
(a) Take
any
action with respect to the Property, other than as directed in paragraph 1
hereof and the Trustee shall have no liability to any party except for liability
arising out of its own gross negligence or willful misconduct;
(b) Institute
any proceeding for the collection of any principal and income arising from,
or
institute, appear in or defend any proceeding of any kind with respect to,
any
of the Property unless and until it shall have received instructions from the
Company given as provided herein to do so and the Company shall have advanced
or
guaranteed to it funds sufficient to pay any expenses incident
thereto;
(c) Change
the investment of any Property, other than in compliance with paragraph
1(c);
(d) Refund
any depreciation in principal of any Property;
(e) Assume
that the authority of any person designated by the Company to give instructions
hereunder shall not be continuing unless provided otherwise in such designation,
or unless the Company shall have delivered a written revocation of such
authority to the Trustee;
(f) The
other
parties hereto or to anyone else for any action taken or omitted by it, or
any
action suffered by it to be taken or omitted, in good faith and in the exercise
of its own best judgment, except for the Trustee's breach of any provision
of
this Agreement or its gross negligence or willful misconduct. The Trustee may
rely conclusively and shall be protected in acting upon any order, notice,
demand, certificate, opinion or advice of counsel (including counsel chosen
by
the Trustee), statement, instrument, report or other paper or document (not
only
as to its due execution and the validity and effectiveness of its provisions,
but also as to the truth and acceptability of any information therein contained)
which is believed by the Trustee, in good faith, to be genuine and to be signed
or presented by the proper person or persons. The Trustee shall not be bound
by
any notice or demand, or any waiver, modification, termination or rescission
of
this agreement or any of the terms hereof, unless evidenced by a written
instrument delivered to the Trustee signed by the proper party or parties and,
if the duties or rights of the Trustee are affected, unless it shall give its
prior written consent thereto;
3
(g) Verify
the correctness of the information set forth in the Registration Statement
or to
confirm or assure that any acquisition made by the Company or any other action
taken by it is as contemplated by the Registration Statement; and
(h) Pay
any
taxes on behalf of the Trust Account (it being expressly understood that the
Property shall not be used to pay any such taxes and that such taxes, if any,
shall be paid by the Company from funds not held in the Trust
Account).
4. Termination.
This
Agreement shall terminate as follows:
(a) If
the
Trustee gives written notice to the Company that it desires to resign under
this
Agreement, the Company shall use its reasonable efforts to locate a successor
trustee. At such time that the Company notifies the Trustee that a successor
trustee has been appointed by the Company and has agreed to become subject
to
the terms of this Agreement, the Trustee shall transfer the management of the
Trust Account to the successor trustee, including but not limited to the
transfer of copies of the reports and statements relating to the Trust Account,
whereupon this Agreement shall terminate; provided, however, that, in the event
that the Company does not locate a successor trustee within ninety days of
receipt of the resignation notice from the Trustee, the Trustee may submit
an
application to have the Property deposited with the United States District
Court
for the Southern District of New York and upon such deposit, the Trustee shall
be immune from any liability whatsoever;
(b) At
such
time that the Trustee has completed the liquidation of the Trust Account in
accordance with the provisions of paragraph 1(j) hereof, and distributed the
Property in accordance with the provisions of the Termination Letter, this
Agreement shall terminate except with respect to Paragraph 2(b); or
(c) On
such
date after June 20, 2008, when the Trustee deposits the Property with the United
States District Court for the Southern District of New York in the event that,
prior to such date, the Trustee has not received a Termination Letter from
the
Company pursuant to paragraph 1(j).
5. Miscellaneous.
(a) The
Company and the Trustee each acknowledge that the Trustee will follow the
security procedures set forth below with respect to funds transferred from
the
Trust Account. Upon receipt of written instructions, the Trustee will confirm
such instructions with an Authorized Individual at an Authorized Telephone
Number listed on the attached Exhibit C. The Company and the Trustee will each
restrict access to confidential information relating to such security procedures
to authorized persons. Each party must notify the other party immediately if
it
has reason to believe unauthorized persons may have obtained access to such
information, or of any change in its authorized personnel. In executing funds
transfers, the Trustee will rely upon account numbers or other identifying
numbers of a beneficiary, beneficiary's bank or intermediary bank, rather than
names. The Trustee shall not be liable for any loss, liability or expense
resulting from any error in an account number or other identifying number,
provided it has accurately transmitted the numbers provided.
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(b) This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the State of New York, without giving effect to conflict of laws. It
may
be executed in several counterparts, each one of which shall constitute an
original, and together shall constitute but one instrument.
(c) This
Agreement contains the entire agreement and understanding of the parties hereto
with respect to the subject matter hereof. This Agreement or any provision
hereof may only be changed, amended or modified by a writing signed by each
of
the parties hereto. As to any claim, cross claim or counterclaim in any way
relating to this Agreement, each party waives the right to trial by
jury.
(d) The
parties hereto consent to the jurisdiction and venue of any state or federal
court located in the State of New York for purposes of resolving any disputes
hereunder.
(e) Any
notice, consent or request to be given in connection with any of the terms
or
provisions of this Agreement shall be in writing and shall be sent by express
mail or similar private courier service, by certified mail (return receipt
requested), by hand delivery or by facsimile transmission:
if
to the
Trustee, to:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxx X. Xxxxxx
Tel:
(000) 000-0000
Fax:
(000) 000-0000
if
to the
Company, to:
0000
Xxxxxxxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
Xxxxxxx 00000
Attn:
Xxxxxxxxxxx X. Xxxxxx, Chief Executive Officer and President
Tel:
(000) 000-0000
Fax:
(000) 000-0000
With
a
copy to:
Pillsbury
Xxxxxxxx Xxxx Xxxxxxx LLP
0000
Xxxxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxx X. Xxxxxxx, Xx., Esq.
Tel:
(000) 000-0000
Fax:
(000) 000-0000
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With
a
copy in each case to:
Capital
Growth Financial, LLC
000
XX
Xxxxxx Xxxx., Xxxxx 000
Xxxx
Xxxxx, Xxxxxxx 00000
Attn:
Xxxx X. Xxxxxx
and:
Xxxxxxxxx
Xxxxxxx, P.A.
000
Xxxxx
Xxxxxxx Xxxxx
Xxxxx
000
Xxxx
Xxxx
Xxxx
Xxxxx, XX 00000
Attn:
Xxxxxx X. Xxxxx, Esq.
(f) This
Agreement may not be assigned by the Trustee without the prior consent of the
Company.
(g) Each
of
the Trustee and the Company hereby represents that it has the full right and
power and has been duly authorized to enter into this Agreement and to perform
its respective obligations as contemplated hereunder.
(h) The
Trustee acknowledges and agrees that it shall not make any claims or proceed
against the Trust Account, including by way of set-off, and shall not be
entitled to any funds in the Trust Account under any circumstance.
[Remainder
of Page Intentionally Left Blank.]
6
IN
WITNESS WHEREOF, the parties have duly executed this Investment Management
Trust
Agreement as of the date first written above.
| RESTAURANT ACQUISITION PARTNERS, INC. | ||
| |
|
|
| By: | /s/ Xxxxxxxxxxx X. Xxxxxx | |
|
Name: Xxxxxxxxxxx X. Xxxxxx |
||
| Title: Chief Executive Officer and President | ||
| CONTINENTAL STOCK TRANSFER & TRUST COMPANY | ||
| |
|
|
| By: | /s/ Xxxxx X. XxXxxxx | |
|
Name: Xxxxx X. XxXxxxx |
||
| Title: CFO | ||
[Signature
Page to Investment Management Trust
Agreement]
EXHIBIT
A
[Insert
Date]
Attn:
Re:
Trust
Account No.
[ ]—Termination
Letter
Ladies
and Gentlemen:
Pursuant
to paragraph 1(k) of the Investment Management Trust Agreement between
Restaurant Acquisition Partners, Inc., a Delaware corporation (“Company”),
and
Continental Stock Transfer & Trust Company
Transfer
Agent, a New York corporation (“Trustee”),
dated
as of December 15, 2006 (“Trust
Agreement”),
this
is to advise you that the Company has entered into an agreement (“Business
Agreement”)
with
[Insert Name of Target] (“Target
Business”)
to
consummate a business combination with Target Business (“Business
Combination”)
on or
about [Insert Date]. The Company shall notify you at least 48 hours in advance
of the actual date of the consummation of the Business Combination (“Consummation
Date”).
In
accordance with the terms of the Trust Agreement, we hereby authorize you to
commence liquidation of the Trust Account to the effect that, on the
Consummation Date, all of the funds held in the Trust Account will be
immediately available for transfer to the account or accounts that the Company
shall direct on the Consummation Date.
On
the
Consummation Date (i) the Company shall deliver to you written notification
that
(a) the Business Combination has been consummated and (b) the provisions of
Section 11 51 302(6) and Rule 51 3.4 of the Colorado Revised Statutes have
been
met, and (ii) the Company shall deliver to you written instructions with respect
to the transfer of the funds held in the Trust Account (“Instruction
Letter”).
[Such
Instruction Letter to include instructions to pay the deferred underwriting
discount the deferred non-accountable expense to the Underwriter.] You are
hereby directed and authorized to transfer the funds held in the Trust Account
immediately upon your receipt of the Instruction Letter, in accordance with
the
terms of the Instruction Letter. In the event that certain deposits held in
the
Trust Account may not be liquidated by the Consummation Date without penalty,
you will notify the Company of the same and the Company shall issue written
instructions directing you as to whether such funds should remain in the Trust
Account and distributed after the Consummation Date to the Company. Upon the
distribution of all the funds in the Trust Account pursuant to the terms hereof,
the Trust Agreement shall be terminated.
In
the
event that the Business Combination is not consummated on the Consummation
Date
described in the notice thereof and we have not notified you on or before the
original Consummation Date of a new Consummation Date, then the funds held
in
the Trust Account shall be reinvested as provided in the Trust Agreement on
the
business day immediately following the Consummation Date as set forth in the
notice.
|
Very
truly
yours,
|
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| |
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| By: | ||
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| By: | ||
|
|
||
EXHIBIT
B
[Insert
Date]
Attn:
Re:
Trust
Account No.
[
]—Termination Letter
Ladies
and Gentlemen:
Pursuant
to paragraph 1(k) of the Investment Management Trust Agreement between
Restaurant Acquisition Partners, Inc., a Delaware corporation (“Company”),
and
Continental
Stock Transfer & Trust Company,
a New
York corporation (“Trustee”),
dated
as of December 15, 2006 (“Trust
Agreement”),
this
is to advise you that the Board of Directors of the Company has voted to
dissolve and liquidate the Company. Attached hereto is a copy of the minutes
of
the meeting of the Board of Directors of the Company relating thereto, certified
by the Secretary of the Company as true and correct and in full force and
effect.
In
accordance with the terms of the Trust Agreement, we hereby (a) certify to
you
that the provisions of Section 11 51 302(6) and Rule 51 3.4 of the Colorado
Revised Statutes have been met and (b) authorize you, to commence liquidation
of
the Trust Account. You will notify the Company and JPMorgan Chase (“Designated
Paying Agent”)
in
writing as to when all of the funds in the Trust Account will be available
for
immediate transfer (“Transfer
Date”).
The
Designated Paying Agent shall thereafter notify you as to the account or
accounts of the Designated Paying Agent that the funds in the Trust Account
should be transferred to on the Transfer Date so that the Designated Paying
Agent may commence distribution of such funds in accordance with the Company's
instructions. You shall have no obligation to oversee the Designated Paying
Agent's distribution of the funds. Upon the payment to the Designated Paying
Agent of all the funds in the Trust Account, the Trust Agreement shall be
terminated.
|
Very
truly
yours,
|
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| By: | ||
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| By: | ||
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EXHIBIT
C
AUTHORIZED
INDIVIDUAL(S)
AUTHORIZED
FOR TELEPHONE CALL BACK TELEPHONE NUMBER(S)
COMPANY:
0000
Xxxxxxxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx,
Xxxxxxx 00000
Attn:
Xxxxxxxxxxx X. Xxxxxx, Chief Executive Officer and President
TRUSTEE:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Xxxxxx X. Xxxxxx
