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Kranem Corporation: Exhibit 10.1 - Filed by newsfilecorp.com

Exhibit 10.1

COMMON TO PREFERRED STOCK EXCHANGE AGREEMENT

     THIS Common to Preferred
Stock Exchange Agreement (hereinafter referred to as the “Agreement”) is
dated as of November 21, 2011 (the “Effective Date”), by and between the
investors, listed in Exhibit A, attached hereto, and the signature page to this
Agreement (each individually an “Investor” and collectively the
“Investors”) and Kranem Corporation, a Colorado corporation (the
“Company”). The Investors and the Company are sometimes hereinafter
referred to collectively as the “Parties” and individually as a
“Party.”

     WHEREAS, each Investor
warrants and represents that it is the record owner of the number of shares of
the common stock (the “Common Stock”) of the Company (“Investor’s
Shares”) set forth opposite such Investor’s name under the Amount of Common
Shares column set forth in Exhibit A attached hereto; 

     WHEREAS, each of the
Investors has owned its Investor’s Shares for less than six months and such
Investor’s Shares are not currently freely tradeable; and

     WHEREAS, each Investor has
requested the Company to allow it to convert (the “Conversion”) its
Investor’s Shares into convertible series A preferred stock (the “Series
A Preferred Stock”) of the Company at a ratio of 1 share of Series A
Preferred Stock for each 100 shares of the Common Stock (the “Conversion
Ratio”), which is set forth opposite the Investor’s name under the Amount of
Preferred Shares column set forth therein, and to convert such Preferred Shares
back into Common Stock (the “Reconversion”) at its option, subject to the
restrictions set forth herein, and the Company is willing to allow such
Conversion at the Conversion Ratio under the terms and conditions of this
Agreement.

NOW, THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

     1.    
Conversion of the Investor’s Shares into Series A Preferred Stock and
Cancellation of the Investor’s Shares. Subject to the terms and
conditions of this Agreement, the Parties hereby agree to the Conversion of the
Investor’s Shares at the Conversion Ratio. The Parties agree that the Investor’s
Shares shall be cancelled and the Series A Preferred Stock shall be issued to
the Investor on the Effective Date hereof. The Company shall deliver a stock
certificate for the Series A Preferred Stock, including fractional shares, to
the Investor for the Preferred Stock on or as soon as possible after the
Effective Date hereof. The Series A Preferred Stock shall have the designations,
powers, rights, preferences, qualifications, restrictions and limitations as set
forth herein. The Investors shall receive the same cash or stock dividend that
is received by the Company’s Common Stock shareholders. Notwithstanding anything
to the contrary herein, all voting of shareholders of the Company shall be as a
single class on an “as-converted” basis using the Reconversion Ratio, as defined
in section 2.a below, as adjusted from time to time pursuant to section 2.b
below. The Parties agree and each of the Investors acknowledge that shareholding
voting shall not be by classes or series of stock unless the Company’s articles
of incorporation are subsequently amended to provide for voting by classes or
series.

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     2.     The
Conditions of the Conversion of the Preferred Stock into Common
Stock. The Parties agree that the Series A Preferred Stock may be
converted to Common Stock (the “Reconversion”), at the option of the
Investor, under the following terms and conditions:

         
a.     The initial conversion ratio of the Preferred Stock
back into the Common Stock shall be one share of Preferred Stock for 100 shares
of Common Stock (the “Reconversion Ratio”).

         
b.     The Reconversion Ratio shall be adjusted
proportionally to reflect Common Stock splits, Common Stock or Preferred Stock
dividends issued to holders of the Common Stock, and/or comparable corporate
transaction after the Effective Date hereof. 

         
c.     The Reconversion shall be at the option of the
Investor provided however the Reconversion shall not be allowed until the
Company has notified the Investor that it has sufficient authorized Common Stock
to allow the Reconversion to occur and. 

     3.     Each
of the Investors represents that it has (i) good title to the Investor’s Shares
standing in its name on the books of the Company, and (ii) all necessary power
and authority to enter into and perform this Agreement. The Investor (i) accepts
ownership of the Series A Preferred Shares issued pursuant to this Agreement,
(ii) assumes all of the rights, privileges and obligations of the Series A
Preferred Shares, and (iii) agrees to be bound by the terms and conditions of
this Agreement.

     4.     The Company
warrants and represents that 

          a.    
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Colorado. The Company has full corporate
power and authority to own and hold its properties and to conduct its business
as described in the Company’s SEC Reports. The Company is duly qualified to do
business and is in good standing in each jurisdiction in which the nature of its
business requires qualification or good standing, except for any failure to be
so qualified or be in good standing that would not have a material adverse
effect.

         
b.     The shares of Series A Preferred Stock and the Common
Stock issuable upon Reconversion of the Series A Preferred, when issued, will be
validly issued, fully paid and non-assessable and will be free and clear of all
liens and will not be subject to any preemptive rights or other similar rights
of any other person or entity.

         
c.     No consents, filings, authorizations or other actions
of any governmental authority are required to be obtained or made by the Company
for the Company’s execution, delivery and performance of this Agreement which
have not already been obtained or made. No consent, approval, waiver or other
action by any person or entity under any agreement or contract to which the
Company is a party or by which the Company or any of its properties or assets
are bound is required or necessary for the execution, delivery or performance by
the Company of this Agreement and the consummation of the transactions
contemplated hereby, except where the failure to obtain such consents would not have
a material adverse effect on the Company.

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     5.     Each of the
Investors warrants and represents and confirms that:

         
a.     The Investor is acquiring the Series A Preferred
Stock and, upon Reconversion, the Common Stock solely for its own account for
investment, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and the Investor has no present intention of
selling, granting any participation in, or otherwise distributing the same.

         
b.     The Investor does not have any contract, undertaking,
agreement or arrangement with any person to sell, transfer or grant
participation to such person or any third person, with respect to any of the
Investor’s Shares or the Series A Preferred Stock. 

         
c.     The Investor understands that the Series A Preferred
Stock and the Common Stock into which the Series A Preferred Stock may be
converted are characterized as “restricted securities” under the Federal
Securities laws and that under such laws and applicable regulations, such
securities may be resold without registration under the Securities Act of 1933,
as amended (the “Act”), only in certain limited circumstances. In this
connection, the Investor represents it is familiar with SEC Rule 144 as
presently in effect, and understands the resale limitations imposed thereby and
by the Act, and that the Company has no obligations, and no current plans to
satisfy the current information obligations of such rule.

         
d.     The Investor has had an opportunity to ask questions
of and receive answers, and has asked questions and has received answers, from
the Company regarding the Company, its business and prospects and the terms and
conditions of the sale of the Preferred Stock and the Common Stock into which
the Preferred Stock may be converted. Investor has received all the information
it considers necessary or appropriate for deciding whether to convert the
Investor’s Shares into the Preferred Stock. The Investor has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks of the Conversion and Reconversion to be made by it
hereunder.

         
e.     The Investor has previously invested in securities of
companies in the development stage and acknowledges it is able to fend for
itself, can bear the economic risk of its investment and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits of converting the Investor’s Shares into Preferred Shares.

         
f.     The Investor is an “accredited investor” as that term
is defined in Rule 501 of Regulation D of the Act, as presently in effect.

         
g.     No oral or written material representations have been
made to the Investor in connection with the Investor’s Conversion of the
Investor’s Shares into Series A Preferred Stock which were in any way
inconsistent with the information reviewed by the Investor. The Investor
acknowledges that in deciding whether to convert the Investor’s Shares
hereunder, it has not relied on any representations or warranties of any type or
description made by the Company or any of its representatives with regard to the
Company, or any of its affiliates or subsidiaries, any of their respective
businesses or properties, or the prospects of the investment contemplated
herein. 

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     6. This Agreement shall be
governed by and construed under the laws of the State of Colorado as applied to
agreements among Colorado residents entered into and to be performed entirely
within Colorado. 

     7. The Parties agree to execute
such further instruments and to take such further action as may reasonably be
necessary to carry out the intent of this Agreement.

     8. This Agreement shall be
binding upon the Investor, successors, assigns and legal representatives of the
Parties hereto.

     9. This Agreement may be signed
by facsimile and executed in counterparts with the same force and effect as if
each of the signatories had executed the same instrument. 

 

[REST OF PAGE INTENTIONALLY LEFT BLANK]

 

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     IN WITNESS WHEREOF, the
Parties hereto have executed this Agreement as the Effective Date.

	THE INVESTORS 	THE COMPANY 
	  	  
	Empire Capital Partners LP 	  
	  	  
	Signature: /s/ Peter J. Richards	Signature: /s/ Edward Miller
	Name: Peter J. Richards	Name: Edward Miller
	Title: Managing Partner 	Title: CFO
	  	  
	Peter Richards 	  
	  	  
	Signature: /s/ Peter J. Richards 	  
	Name: Peter J. Richards 	  
	  	  
	Fecund Investments S.A 	Extant Investments Ltd. 
	  	  
	Signature: /s/ Rosabelle Neol-Bradburn	Signature: /s/ Ineeze Anacoura
	Name: Rosabelle Neol-Bradburn 	Name: Ineeze Anacoura
	Title: Director	Title: Director
	  	  
	Xalted Holding Corporation 	Investco Alliance Inc. 
	  	  
	Signature: /s/ Ajay Batheja 	Signature: /s/ Janette Powell 
	Name: Ajay Batheja 	Name: Janette Powell authorized signatory

	  	Signed on behalf of Glenside Limited 
	Title: CEO	Title: Director

 

[Signature Page Stock Exchange Agreement]

 

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EXHIBIT A 
INVESTORS

	  	  	Amount of 	Amount of 
	  	Name of Investor 	Common Shares 	Preferred Shares 
	  	  	  	  
	1. 	Fecund Investments S.A 	5,235,400 	52,354.00 
	2. 	Extant Investments Ltd. 	5,235,395 	52,353.95 
	3. 	Empire Capital Partners, L.P.
    	2,991,655 	29,916.65 
	4. 	Peter Richards 	1,495,830 	14,958.30 
	5. 	Xalted Holding Corporation 	11,634,220 	116,342.20 
	6. 	Investco 	6,648,125 	66,481.25 
	  	  	33,240,625 	332,406.25

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Exhibit 10.1

 

INVESTMENT MANAGEMENT TRUST AGREEMENT

 

This investment management trust agreement (“Agreement”) is made as of [●], 2011, by and between Chart Acquisition Corp. (the “Company”), a Delaware corporation and Continental Stock Transfer & Trust Company (the “Trustee”) located at 17 Battery Place, New York, New York 10004.  Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Registration Statement.

WHEREAS, the Company’s initial registration statement, as amended, on Form S-1, No. 333-177280 (the “Registration Statement”), for its initial public offering of securities (the “IPO”) have been declared effective as of the date hereof by the Securities and Exchange Commission (the “Commission”);

WHEREAS, Cowen and Company, LLC is acting as the representative of the several underwriters in the IPO (the “Underwriters”) pursuant to an underwriting agreement (the “Underwriting Agreement”);

WHEREAS, simultaneously with the IPO, Chart Acquisition Group LLC, a Delaware limited liability company, will be purchasing an aggregate of 3,000,000 placement units (“Placement Units”) for an aggregate purchase price of $3,000,000.  Each Placement Unit consists of one share of Common Stock (as defined below) and one warrant to purchase one share of Common Stock;

WHEREAS, simultaneously with the IPO, Cowen Overseas Investment LP, a Cayman Islands limited partnership and an affiliate of Cowen and Company, LLC, will purchase an aggregate of 175,000 Placement Units of the Company for an aggregate purchase price of $1,725,000;

 

WHEREAS, as described in the Registration Statement, and in accordance with the Company’s Certificate of Incorporation, (as amended, the “Certificate of Incorporation”), $100,600,000 of the gross proceeds of the IPO and sale of the Placement Units ($115,187,500 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 (the “Trust Account”) for the benefit of the Company and the holders of the Company’s common stock, par value $.0001 per share (the “Common Stock”), issued in the IPO as hereinafter provided 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 the Colorado Statute is attached hereto and made a part hereof (the aggregate amount to be delivered to the Trustee will be referred to herein as the “Property,” the common 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”);

 

  

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WHEREAS, pursuant to certain provisions in the Company’s Certificate of Incorporation, the Public Stockholders may, regardless of how such stockholder votes in connection with the Company’s initial acquisition, through a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (a “Business Combination”), demand the Company redeem such Public Stockholder’s Common Stock into cash or redeem such Common Stock pursuant to a tender offer pursuant to the Rule 13e-4 and Regulation 14E of the Commission, as applicable and based upon the Company’s choice of proceeding under the proxy rules or tender offer rules, each as promulgated by the Commission (“Redemption Rights”);

WHEREAS, pursuant to the Underwriting Agreement, a portion of the Property equal to 3.125% of the gross proceeds of the IPO will be payable to the Underwriters in the event of consummation of a Business Combination (the “Deferred Fee”);

WHEREAS, pursuant to the Underwriting Agreement, the Deferred Fee is payable solely upon the consummation of the Company’s Business Combination and pursuant to the terms thereof; and

WHEREAS, the Company and the Trustee are entering into this Agreement to set forth the terms and conditions pursuant to which the Trustee shall hold the Property.

NOW THEREFORE, 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 Trust Accounts which shall be established by the Trustee at JP Morgan Chase Bank, N.A. and at a brokerage institution selected by the Trustee that is reasonably satisfactory to the Company;

 

(b)           Manage, supervise and administer the Trust Account subject to the terms and conditions set forth herein;

(c)           In a timely manner, upon the written instruction of the Company, to invest and reinvest the Property in U.S. government treasury bills with a maturity of 180 days or less, and/or money market funds meeting certain conditions of Rule 2a-7 under the Investment Company Act of 1940, as amended, and that invest solely in U.S. Treasuries, as determined by the Company.

 

  

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(d)           Collect and receive, when due, all principal and interest 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 its tax returns;

 

(g)           Participate in any plan or proceeding for protecting or enforcing any right or interest arising from the Property if, as and when reasonably indemnified by the Company and instructed by the Company to do so, so long as the Company shall have advanced funds sufficient to pay the Trustee’s expenses incident thereto.

(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; and

 

(i)           Commence liquidation of the Trust Account only after and 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 hereto, signed on behalf of the Company by an executive officer and complete the liquidation of the Trust Account and distribute the Property in the Trust Account only as directed by the Company; provided, however, that in the event that a Termination Letter has not been received by the Trustee by 11:59 P.M. New York City time on the 21-month anniversary of the closing of the IPO, the Trust Account shall be liquidated as soon as practicable thereafter in accordance with the procedures set forth in the Termination Letter attached as Exhibit B hereto and distributed to the Public Stockholders of record at the close of trading (4:00 P.M. New York City time) on such 21 month anniversary date.  For the purposes of clarity, any transmission of such Termination Letter electronically, whether by facsimile, electronic mail (e-mail), PDF or otherwise, shall constitute an original of such termination Letter hereunder.

2.           Limited Distributions of Income from Trust Account.

 

(a)           Upon written request from the Company, which may be given from time to time in a form substantially similar to that attached hereto as Exhibit C, the Trustee shall distribute to the Company by wire transfer from the income collected on the Property the amount necessary to cover any tax obligation owed by the Company.

 

  

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(b)           The Company may withdraw funds from the Trust Account for working capital purposes by delivery of Exhibit C to the Trustee.  The distributions referred to herein shall be made only from income collected on the Property.

 

(c)           Also by delivery of Exhibit C and only if the Company elects to seek a stockholder vote in connection with the Business Combination, the Company may request the release of funds necessary to repurchase up to fifteen percent (15%) of the Common Stock sold in the IPO.  In connection therewith, the Company shall deliver, in addition to Exhibit C, a “trade ticket” or similar confirmation evidencing such purchase by the Company.  Upon receipt of such evidence, the Trustee shall, as soon as practicable, release the necessary funds to the Company in order to complete such trade within two trading days of the trade date.  The Trustee shall pay to the Company such amount equal to: (x) the number of shares of Common Stock purchased (evidenced by the trade ticket) multiplied by (y) an amount not to exceed the pro rata per share amount held in the Trust Account; provided, however, in no event shall the Trustee release funds to repurchase in excess of 1,500,000 shares of Common Stock (1,725,000 if the over-allotment option of the IPO is exercised in full or such other amount provided to the Trustee if the over-allotment option is partially exercised but not to exceed 1,725,000 shares of Common Stock).

(d)           In no event shall the payments authorized by Sections 2(a) and 2(b) cause the amount in the Trust Account to fall below the amount initially deposited into the Trust Account.  Except as provided in Sections 2(a), 2(b) and 2(c) above, no other distributions from the Trust Account shall be permitted except in accordance with Section 1(i) hereof.

 

(e)           The written request of the Company referenced above shall constitute presumptive evidence that the Company is entitled to such funds, and the Trustee has no responsibility to look beyond said request.

3.           Agreements and Covenants of the Company.  The Company hereby agrees and covenants to:

 

(a)           Give all instructions to the Trustee hereunder in writing or the electronic equivalent, signed by the Company’s President, Chief Executive Officer or Chief Financial Officer, and as specified in Section 1(i).  In addition, except with respect to its duties under Sections 1(i), 2(a), 2(b) and 2(c) above, the Trustee shall be entitled to rely on, and shall be protected in relying on, any verbal, electronic 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;

 

  

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(b)           Subject to the provisions of Section 5, hold the Trustee harmless and indemnify the Trustee from and against, any and all expenses, including reasonable counsel fees and disbursements, or losses suffered by the Trustee in connection with any action taken by the trustee hereunder or any claim, potential claim, 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 section, 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 Trustee may not agree to settle any Indemnified Claim without the prior written consent of the Company, which consent shall not be unreasonably withheld.  The Company may participate in such action with its own counsel;

(c)           Pay the Trustee the fees set forth on Schedule A hereto;

 

(d)           In connection with the vote, if any, 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/or tabulating stockholder votes verifying the vote of the Company’s stockholders regarding such Business Combination; and

 

(e)           In the event that the Company directs the Trustee to commence liquidation of the Trust Account pursuant to Section 1(i), the Company agrees that it will not direct the Trustee to make any payments that are not specifically authorized by this Agreement.

 

(f)           Promptly after the Deferred Fee shall become determinable on a final basis, to provide the Trustee notice in writing (with a copy to Cowen and Company, LLC, as representative of the underwriters in the IPO) of the total amount of the Deferred Fee.

4.           Limitations of Liability.  The Trustee shall have no responsibility or liability to:

 

(a)           Imply obligations, perform duties, inquire or otherwise be subject to the provisions of any agreement or document other than this agreement and that which is expressly set forth herein;

 

(b)           Take any action with respect to the Property, other than as directed in Sections 1 and 2 hereof and the Trustee shall have no liability to any party except for liability arising out of its own gross negligence or willful misconduct;

 

(c)           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 written instructions from the Company given as provided herein to do so and the Company shall have advanced to it funds sufficient to pay any expenses incident thereto;

 

  

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(d)           Change the investment of any Property, other than in compliance with Section 1(c);

(e)           Refund any depreciation in principal of any Property;

 

(f)           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;

 

(g)           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, judgment, instruction, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Trustee, which counsel may be Company counsel), 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;

 

(h)           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

 

(i)            Prepare, execute and file tax reports, income or other tax returns and pay any taxes with respect to income and activities relating to the Trust Account, regardless of whether such tax is payable by the Trust Account or the Company (including but not limited to income tax obligations), it being expressly understood that as set forth in Section 2(a), if there is any income or other tax obligation relating to the Trust Account or the Property in the Trust Account, as determined from time to time by the Company and regardless of  whether such tax is payable by the Company or the Trust, at the written instruction of the Company, the Trustee shall make funds available in cash from the Property in the Trust Account an amount specified by the Company as owing to the applicable taxing authority, which amount shall be paid directly to the Company by electronic funds transfer, account debit or other method of payment, and the Company shall forward such payment to the taxing authority;

 

(j)           Pay or report any taxes on behalf of the Trust Account other than pursuant to Section 2(a).

 

  

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(k)           Verify calculations, qualify or otherwise approve Company requests for distributions pursuant to Sections 1(i), 2(a), 2(b) or 2(c).

5.           No Right of Set-Off.  The Trustee waives any right of set-off or any right, title, interest or claim of any kind that the Trustee may have against the Property held in the Trust Account.  In the event the Trustee has a claim against the Company under this Agreement, including, without limitation, under Section 3(b), the Trustee will pursue such claim solely against the Company and not against the Property held in the Trust Account.

6.           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 during which time the Trustee shall act in accordance with this Agreement.  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 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 any court in the State of New York or 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; or

 

(b)           At such time that the Trustee has completed the liquidation of the Trust Account in accordance with the provisions of Section 1(i) hereof, and distributed the Property in accordance with the provisions of the Termination Letter, this Agreement shall terminate except with respect to Section 3(b).

7.           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.  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 all information supplied to it by the Company, including, account names, account numbers, and all other identifying information relating to a beneficiary, beneficiary’s bank or intermediary bank. The Trustee shall not be liable for any loss, liability or expense resulting from any error in the information or transmission of the wire.

 

  

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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 conflicts of law principles that would result in the application of the substantive laws of another jurisdiction.  It may be executed in several original or facsimile 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.  Except for Sections 1(i), 2(a), 2(b), 2(c) and 2(d) (which may not be modified, amended or deleted without the affirmative vote of at least 65% of the then outstanding shares of Common Stock; provided that no such amendment will affect any Public Stockholder who has otherwise either (i) indicated his election to redeem his shares of Common Stock in connection with a stockholder vote sought to amend this Agreement or (ii) not consented to any amendment to this Agreement to extend to the time he would be entitled to a return of his pro rata amount in the Trust Account), this Agreement or any provision hereof may only be changed, amended or modified (other than to correct a typographical error) 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 and the right to set-off as a defense.  The Trustee may request an opinion from Company counsel as to the legality of any proposed amendment as a condition to its executing such amendment.

 

(d)           The parties hereto consent to the personal jurisdiction and venue of any state or federal court located in the City of New York, Borough of Manhattan, for purposes of resolving any disputes hereunder.

 

(e)           Unless otherwise specified herein, 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 or delivery confirmation requested), by hand delivery or by electronic  or facsimile transmission:

if to the Trustee, to:

Continental Stock Transfer

& Trust Company

17 Battery Place

New York, New York 10004

Attn:  Frank A. DiPaolo, CFO

Fax No.:  (212) 509-5150

 

  

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if to the Company, to:

 

Chart Acquisition Corp.

75 Rockefeller Plaza, 14th Floor,

New York, NY 10019

Fax: ([●])

Attention: Michael LaBarbera

with a copy to (which shall not constitute notice):

Ellenoff Grossman & Schole LLP

150 East 42nd Street, 11th Floor

New York, New York 10017

Attn: Stuart Neuhauser, Esq.

Fax No: (212)-370-7889

(e)           This Agreement may not be assigned by the Trustee without the prior consent of the Company.

 

(f)           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.  In the event the Trustee has a claim against the Company under this Agreement, the Trustee will pursue such claim solely against the Company and not against the Property held in the Trust Account.

 

(g)           This Agreement is the joint product of the Trustee and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto

 

(h)           This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same instrument.  Delivery of a signed counterpart of this Agreement by facsimile or electronic transmission shall constitute valid and sufficient delivery thereof.

 

(i)           The Company has also retained the Trustee to serve as its share transfer agent and warrant agent and shall pay the fees set forth in Schedule A for such services.  Additionally, the Trustee has agreed to provide all services, including, but not limited to: the mailing of proxy or tender documents to registered holders, all wires in connection with the Business Combination (including the exercise of Redemption Rights) and maintaining the official record of the exercise of Redemption Rights and stockholder voting (if applicable).

[Signature page follows]

 

  

9

  

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:  Frank A. Di Paolo

Title:    Chief Financial and Trust Officer

CHART ACQUISITION CORP.

By: _______________________

Name:  Michael LaBarbera

Title:    Chief Financial Officer

  

10

  

 

SCHEDULE A

	
Fee Item

	
Time and method of payment

	
Amount (1)

	
IPO closing fee

	
Consummation of IPO by wire transfer of funds

	
$3,500

	
Annual trustee fee

	
Upon execution of the IMTA and at each anniversary

	
$5,000.00

	
Share transfer agent fee

	
Monthly by check or wire transfer of funds

	
$500

	  	  	  
	
Warrant agent fee

	
Monthly by check or wire transfer of funds

	
$200

	
All services in connection with a Business Combination and/or all services in connection with liquidation of Trust Account if no Business Combination.

	
Upon final liquidation of the Trust Account but, upon liquidation if no Business Combination, only from interest earned or from the Company by wire transfer of funds

	
Prevailing rates after consultation with the issuer and its counsel at the time of combination. The minimum fee shall be $5000.

(1) Any amounts owed by the Company are subject in their entirety to the provisions of Section 5 of this Agreement.

 

  

11

  

 

EXHIBIT A

[Letterhead of Company]

[Insert date]

Continental Stock Transfer

& Trust Company

17 Battery Place

New York, New York 10004

Attn:  Steven Nelson and Frank Di Paolo

Re:           Trust Account No. [     ]   - Termination Letter

Gentlemen:

Pursuant to Section 1(i) of the Investment Management Trust Agreement between Chart Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust Company, dated as of [        ], 2011 (“Trust Agreement”), this is to advise you that the Company has entered into an agreement with [       ] (the “Target Businesses”) to consummate a Business Combination with the Target Businesses on or before [         ] (the “Consummation Date”). This letter shall serve as the 48 hour notice required with respect to the Business Combination. Capitalized words used herein and not otherwise defined shall have the meanings ascribed to them in the Trust Agreement.

 

In accordance with the terms of the Trust Agreement, we hereby authorize you to liquidate the Trust Account investments on [       ] and to transfer the entire proceeds to the above referenced Trust checking account at [          ] 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.  It is acknowledged and agreed that while the funds are on deposit in the Trust checking account awaiting distribution, the Company will not earn any interest or dividends.

 

On or before the Consummation Date: (i) counsel for the Company shall deliver to you (a) an affidavit which verifies the vote of the Company’s stockholders in connection with the Business Combination1, (b) written notification that the Business Combination has been consummated or will, concurrently with your transfer of funds to the accounts as directed by the Company, be consummated and (c) notice 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 (“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 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 or be distributed immediately and the penalty incurred. Upon the distribution of all the funds in the Trust Account pursuant to the terms hereof, the Trust Agreement shall be terminated.

 

  

1 Only if stockholder vote held

  

A-1

  

 

In the event the Business Combination is not consummated by 11:59 p.m. on the Consummation Date and we have not notified you of a new Consummation Date, then, the funds held in the Trust checking account shall be reinvested as provided for by the Trust Agreement as soon as practicable thereafter.

Very truly yours,

CHART ACQUISITION CORP.

 

By: ________________________________

Name:

Title:

cc:           Cowen and Company, LLC

  

A-2

  

 

EXHIBIT B

[Letterhead of Company]

[Insert date]

Continental Stock Transfer

& Trust Company

17 Battery Place

New York, New York 10004

Attn:  Steven Nelson and Frank Di Paolo

Re:           Trust Account No. [    ]   -       Termination Letter

Gentlemen:

Pursuant to Section 1(i) of the Investment Management Trust Agreement between Chart Acquisition Corp. (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”), dated as of ________, 2011 (the “Trust Agreement”), this is to advise you that the Company has been unable to effect a Business Combination with a Target Company within the time frame specified in the Company’s Certificate of Incorporation, as described in the Company’s prospectus relating to its IPO.

In accordance with the terms of the Trust Agreement, we hereby authorize you to liquidate the Trust Account on [      ] and to transfer the total proceeds to the Trust checking account at [         ] for distribution to the stockholders. The Company has selected [       ] as the record date for the purpose of determining the stockholders entitled to receive their pro rata share of the liquidation proceeds.  You agree to be the paying agent of record and in your separate capacity as paying agent to distribute said funds directly to the Company’s stockholders (other than with respect to the initial, or insider shares) in accordance with the terms of the Trust Agreement, the Certificate of Incorporation of the Company and the fees set forth on Schedule A to the Trust Agreement.  Upon the distribution of all of the funds in the Trust Account, your obligations under the Trust Agreement shall be terminated.

Very truly yours,

CHART ACQUISITION CORP.

By: ________________________________

Name:

Title:

cc:           Cowen and Company, LLC

  

B-1

  

 

EXHIBIT C

[Letterhead of Company]

[Insert date]

 

 

Continental Stock Transfer

& Trust Company

17 Battery Place, 8th Floor

New York, New York 10004

Attn:  Steven Nelson and Frank DiPaolo

Re:           Trust Account No. [    ]

Gentlemen:

 

Pursuant to Section [2(a) or 2(b)] of the Investment Management Trust Agreement between Chart Acquisition Corp. (“Company”) and Continental Stock Transfer & Trust Company, dated as of ___________, 2011 (“Trust Agreement”), the Company hereby requests that you deliver to the Company $_______ of the interest income earned on the Property as of the date hereof. The Company needs such funds [to pay for the tax obligations as set forth on the attached tax return or tax statement] or [for working capital purposes] or [for repurchase of ______ shares of Common Stock].  [We have attached the “trade ticket” or similar confirmation as an exhibit to this letter2].  In accordance with the terms of the Trust Agreement, you are hereby directed and authorized to transfer (via wire transfer) such funds promptly upon your receipt of this letter to the Company’s operating account at:

[WIRE INSTRUCTION INFORMATION]

CHART ACQUISITION CORP.

By: ________________________________

Name:

Title:

cc:           Cowen and Company, LLC

 

 

 

2 Only include if this letter is being delivered in connection with a repurchase of Common Stock

 

  

C-1

  

EXHIBIT D

 

	
AUTHORIZED INDIVIDUAL(S) 

FOR TELEPHONE CALL BACK 

	
AUTHORIZED

TELEPHONE NUMBER(S)

	 	 
	Company:	 
	 	 
	Chart Acquisition Corp. 
75 Rockefeller Plaza, 14th Floor,

New York, NY 10019

Attention: Michael LaBarbera   

	 (212) 350-8275
	 	 
	Ellenoff Grossman & Schole LLP 
150 East 42nd Street, 11th Floor

New York, New York, 10017

Stuart Neuhauser, Esq.  

Douglas S. Ellenoff, Esq.

Adam Mimeles, Esq.

	(212) 370-1300
	 	 
	Trustee:	 
	 	 
	Continental Stock Transfer 
& Trust Company

17 Battery Place

New York, New York 10004

Attn: Frank Di Paolo, CFO

	(212) 845-3270

 

 

 

 

D-1

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