INVESTMENT MANAGEMENT TRUST AGREEMENT
EXHIBIT 10.8
This Agreement is made as of , 2006 by and between XXXXX & XXXXX REALTY ADVISORS,
INC. (the “Company”) and CONTINENTAL STOCK TRANSFER & TRUST COMPANY (“Trustee”).
WHEREAS, the Company’s Registration Statement on Form S-11, No. 333-129190 (“Registration
Statement”), for its initial public offering of securities (“IPO”) has been declared effective as
of the date hereof by the Securities and Exchange Commission (“Effective Date”); and
WHEREAS, Deutsche Bank Securities Inc. (“Deutsche Bank”) is acting as the representative of
the underwriters in the IPO (collectively with Deutsche Bank, the “Underwriters”); and
WHEREAS, as described in the Company’s Registration Statement, and in accordance with the
Company’s Amended and Restated Certificate of Incorporation,
$95,750,002 ($110,000,002 if the Underwriters’
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 issued in the IPO and in the event the Units are registered in Colorado, pursuant to Section
11-51-302(6) of the Colorado Revised Statutes, a copy of which statute is attached hereto and made
a part hereof. 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,
pursuant to the Underwriting Agreement, dated as of
,
2006, between the
Company and Deutsche Bank, a portion of the Property equal to
$1,800,000 (or $2,100,000 if the Underwriters’ over-allotment
option is exercised in full) is attributable to the
Underwriters’ fees, which amounts the Underwriters have agreed
to deposit in the Trust Account (defined below) and which will be
paid from the Trust Account to the Underwriters upon the consummation of
a business combination (as defined in the Registration Statement); 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 to:
(a) 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 Statute, in a segregated
trust account (“Trust Account”) established by the Trustee at a branch of X.X. Xxxxxx Chase & Co.
or Citigroup selected by the Trustee;
(b) Manage, supervise and administer the Trust Account subject to the terms and conditions set
forth herein;
(c) 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;
(d) 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;
(e) Notify the Company of all communications received by it with respect to any Property
requiring action by the Company;
(f) 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;
(g) 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 and/or Deutsche Bank to do so;
(h) Render to the Company, 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;
(i) Upon written instructions from the Company, deliver to the Company, on a quarterly basis,
from the Property in the Trust Account, an amount equal to the taxes payable by the Company, if
any, relating to interest earned on the Property; and
(j) Commence liquidation of the Trust Account promptly 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 and affirmed by its entire Board of Directors, 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; provided, however,
that in the event that a Termination Letter has not been received by
, 2007 (or the date
that is the six month anniversary of such date, in the event that a letter of intent, agreement in
principle or definitive agreement has been executed prior to such date in connection with a
Business Combination (as defined in the Termination Letter attached hereto as Exhibit A)
that has not been consummated by
, 2007), the Trust Account shall be liquidated in
accordance with the procedures set forth in the Termination Letter attached as Exhibit B to
the stockholders of record on the record date; provided, further, that the record
date shall be within ten (10) days of
, 2007 (or the date that is the six month anniversary of such
date, in the event that a letter of intent, agreement in principle or definitive agreement has been
executed prior to such date in connection with a Business Combination that has not been consummated
by
, 2007), or as soon thereafter as is practicable.
In all cases, the Trustee shall provide Deutsche Bank with a copy of any Termination letter and/or any other correspodence that it
receives with respect to any proposed withdrawel from the Trust
Account promptly after it receives the same.
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 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
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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 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”). The Trustee shall have the right to conduct
and manage the defense against such Indemnified Claim, provided, that the Trustee shall obtain the
consent of the Company with respect to the selection of counsel, which consent shall not be
unreasonably withheld. The Company may participate in such action with its own counsel;
(c) Pay the Trustee an initial acceptance fee of $1,000 and an annual fee of $3,000 (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);
(d) Provide to the Trustee any letter of intent, agreement in principle or definitive
agreement that is executed prior to
, 2007 in connection with a Business Combination; and
(e) In connection with any vote of the Company’s stockholders regarding a Business
Combination, provide to the Trustee an affidavit or certificate of a firm regularly engaged in the
business of soliciting proxies and tabulating stockholder votes (which firm may be the Trustee)
verifying the vote of the Company’s stockholders regarding such Business Combination.
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
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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 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; and
(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.
(h) Subject to the requirements of Section 1(i) of the Trust Agreement, pay or report any
taxes on behalf of the Trust Account to any governmental entity or taxing authority.
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 (90) 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 that arises due to any actions or omissions to act by any party after such
deposit; or
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(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).
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.
(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 City 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, Xxx Xxxx 00000
& Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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Attn: Xxxxxx X. Xxxxxx, Chairman
Fax No.: (000) 000-0000
Fax No.: (000) 000-0000
if to the Company, to:
Xxxxx & Xxxxx Realty Advisors, Inc.
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxx, Chief Executive Officer
Fax No.: (000) 000-0000
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxx, Chief Executive Officer
Fax No.: (000) 000-0000
in either case with a copy to:
Xxxxxxxx Xxxx & Brandeis, LLP
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
if
to Deutsche Bank, to:
Deutsche Bank Securities Inc.
00 Xxxx Xxxxxx, XXX00-0000
Xxx Xxxx, XX 00000
Attn: Syndicate Manager
Fax: (000) 000-0000
00 Xxxx Xxxxxx, XXX00-0000
Xxx Xxxx, XX 00000
Attn: Syndicate Manager
Fax: (000) 000-0000
with
a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
(f) This Agreement may not be assigned by the Trustee without the prior written 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. 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.
(h) The Trustee hereby consents to the inclusion of Continental Stock Transfer & Trust Company
in the Registration Statement and other materials relating to the IPO.
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IN WITNESS WHEREOF, the parties have duly executed this Investment Management Trust Agreement
as of the date first written above.
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, as Trustee |
||||
By: | ||||
Name: | Xxxxxx X. Xxxxxx | |||
Title: | ||||
XXXXX & XXXXX REALTY ADVISORS, INC. |
||||
By: | ||||
Name: | Xxxx X. Xxxx | |||
Title: | Chief Executive Officer | |||
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EXHIBIT A
[Letterhead of Company]
[Letterhead of Company]
[Insert date]
Continental Stock Transfer
& Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
& Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
Re: Trust Account No. [ ] Termination Letter
Gentlemen:
Pursuant to paragraph 1(j) of the Investment Management Trust Agreement between Xxxxx & Xxxxx
Realty Advisors, Inc. (“Company”) and Continental Stock Transfer & Trust Company (“Trustee”), dated
as of
, 2006 (“Trust Agreement”), this is to advise you that the
Company has entered into an agreement (“Business Agreement”) with (”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”). Defined terms used but not otherwise defined herein
shall have the meaning ascribed to such term in the Trust Agreement.
Pursuant to Section 2(e) of the Trust Agreement, we are providing you with [an affidavit] [a
certificate] of , which verifies the vote of the Company’s stockholders
in connection with the Business Combination. 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 and Deutsche
Bank shall direct on the Consummation Date.
On the Consummation Date (i) counsel for 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 Statute 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,
including, but not limited to, (a) funds to be delivered to any Public
Stockholder that has properly exercised their conversion rights (as
described in the Registration Statement), and (b) pursuant to the
terms of the Underwriting Agreement, dated as of _____________, 2006,
between the Company and Deutsche Bank, the portion of the Property
attributable to the deferred Underwriters’ fees
(“Instruction Letter”). You are hereby directed and authorized to transfer the funds held
in the Trust Account immediately upon your receipt of the counsel’s letter and 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 direct you as to whether such funds should
remain in the Trust Account and be distributed after the Consummation Date to the Company and Deutsche Bank. Upon the
distribution of all the funds in the Trust Account pursuant to the terms hereof, the Trust
Agreement shall be terminated.
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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, XXXXX & XXXXX REALTY ADVISORS, INC. |
||||
By: | ||||
Name: | Xxxx X. Xxxx | |||
Title: | Chief Executive Officer, Secretary & Director | |||
AFFIRMED: |
||||
C. Xxxxxxx Xxxxxxx, Chairman of the Board | ||||
Xxxx X. Xxxx, Director | ||||
Xxxxxxx X. Xxxxxx, Director | ||||
Xxxxxx X. Xxxxx, Director | ||||
Xxxx X. Xxxxxxxx, Director | ||||
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EXHIBIT B
[Letterhead of Company]
[Letterhead of Company]
[Insert date]
Continental Stock Transfer
& Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
& Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
Re: Trust Account No. [ ] Termination Letter
Gentlemen:
Pursuant to paragraph 1(j) of the Investment Management Trust Agreement between Xxxxx & Xxxxx
Realty Advisors, Inc. (“Company”) and Continental Stock
Transfer & Trust Company dated as of , 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 Statute have been met and (b)
authorize you, to commence liquidation of the Trust Account. In connection with this liquidation,
you are hereby authorized to establish a record date for the purposes of determining the
stockholders of record entitled to receive their per share portion of the Trust Account. The record
date shall be within ten (10) days of the liquidation date, or as soon thereafter as is
practicable. You will notify the Company in writing as to when all of the funds in the Trust
Account will be available for immediate transfer (“Transfer Date”) in accordance with the terms of
the Trust Agreement and the Amended and Restated Certificate of Incorporation of the Company. You
shall commence distribution of such funds in accordance with the terms of the Trust Agreement and
the Amended and Restated Certificate of Incorporation of the Company and you shall oversee the
distribution of the funds. Upon the payment of all the funds in the Trust Account, the Trust
Agreement shall be terminated.
Very truly yours, XXXXX & XXXXX REALTY ADVISORS, INC. |
||||
By: | ||||
Name: | Xxxx X. Xxxx | |||
Title: | Chief Executive Officer, Secretary & Director | |||
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AFFIRMED: |
||||
C. Xxxxxxx Xxxxxxx, Chairman of the Board | ||||
Xxxx X. Xxxx, Director | ||||
Xxxxxxx X. Xxxxxx, Director | ||||
Xxxxxx X. Xxxxx, Director | ||||
Xxxx X. Xxxxxxxx, Director | ||||
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EXHIBIT C
AUTHORIZED INDIVIDUAL(S) | AUTHORIZED | |
FOR TELEPHONE CALL BACK | TELEPHONE NUMBER(S) | |
Company: |
||
Xxxxx & Xxxxx Realty Advisors |
||
0000 Xxxxxxx Xxxx, Xxxxx 000 |
||
Xxxxxxxxxx, Xxxxxxxx 00000 |
||
Attn: Xxxx X. Xxxx, Chairman and CEO
|
(000) 000-0000 | |
Trustee: |
||
Continental Stock Transfer & Trust Company |
||
00 Xxxxxxx Xxxxx |
||
Xxx Xxxx, Xxx Xxxx 00000 |
||
Attn: Xxxxxx X. Xxxxxx
|
(000) 000-0000 |
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