Document:

exv10w4

 

Exhibit 10.4

HERBERT C. WILLIAMSON LETTER AGREEMENT

As of June [__], 2005

JK Acquisition Corp.

5847 San Felipe, Suite 4350

Houston, Texas 77057

Ferris, Baker Watts, Incorporated

7601 Lewinsville Road, Suite 450

McLean, Virginia 22102

Re: Initial Public Offering

Gentlemen:

     The undersigned director and stockholder of JK Acquisition Corp. (“Company”), in
consideration of Ferris, Baker Watts, Incorporated (“FBW”) entering into a letter of intent
(“Letter of Intent”) to underwrite an initial public offering of the securities of the
Company (“IPO”) and embarking on the IPO process, hereby agrees as follows (certain
capitalized terms used herein are defined in paragraph 11 hereof):

     1. If the Company solicits approval of its stockholders of a Business Combination, the
undersigned will vote all Insider Shares owned by him in accordance with the majority of the votes
cast by the holders of the IPO Shares.

     2. The undersigned will escrow his Insider Shares until six months after the consummation of a
Business Combination subject to the terms of a Stock Escrow Agreement which the Company will enter
into with the undersigned and an escrow agent acceptable to the Company.

     3. In the event that the Company fails to consummate a Business Combination within 18 months
from the effective date (“Effective Date”) of the registration statement relating to the
IPO (or 24 months under the circumstances described in the prospectus relating to the IPO), the
undersigned will take all reasonable actions within his power to cause the Company to liquidate as
soon as reasonably practicable. The undersigned hereby waives any and all right, title, interest
or claim of any kind (“Claim”) in or to any distribution of the Trust Fund (as defined in
the Letter of Intent) with respect to his Insider Shares and waives any Claim the undersigned may
have in the future as a result of, or arising out of, any contracts or agreements with the Company
and will not seek recourse against the Trust Fund for any reason whatsoever.

4. [Intentionally Omitted.]

     5. The undersigned acknowledges and agrees that the Company will not consummate any Business
Combination which involves a company which is affiliated with any of the Insiders unless the
Company obtains an opinion from an independent investment banking firm reasonably acceptable to FBW
that the business combination is fair to the Company’s stockholders from a financial perspective.

     6. Neither the undersigned, any member of the family of the undersigned, or any affiliate of
the undersigned will be entitled to receive or accept a finder’s fee or any other compensation in
the event the undersigned, any member of the family of the undersigned or any affiliate of the
undersigned originates a Business Combination.

     7. The undersigned agrees to be a director of the Company until the earlier of the
consummation by the Company of a Business Combination or the liquidation of the Company. The
undersigned’s biographical

 

 

information furnished to the Company and FBW and attached hereto as Exhibit A is true
and accurate in all respects, does not omit any material information with respect to the
undersigned’s background and contains all of the information required to be disclosed pursuant to
Section 401 of Regulation S-K, promulgated under the Securities Act of 1933. The undersigned’s
Questionnaire furnished to the Company and FBW and annexed as Exhibit B hereto is true and
accurate in all respects. The undersigned represents and warrants that:

	 	(a)  	he is not subject to or a respondent in any legal action for, any
injunction, cease-and-desist order or order or stipulation to desist or refrain
from any act or practice relating to the offering of securities in any
jurisdiction;
	 
	 	(b)  	he has never been convicted of or pleaded guilty to any crime (i)
involving any fraud or (ii) relating to any financial transaction or handling of
funds of another person, or (iii) pertaining to any dealings in any securities
and he is not currently a defendant in any such criminal proceeding; and
	 
	 	(c)  	he has never been suspended or expelled from membership in any
securities or commodities exchange or association or had a securities or
commodities license or registration denied, suspended or revoked.

     8. The undersigned has full right and power, without violating any agreement by which he is
bound, to enter into this letter agreement and to serve as a director of the Company.

     9. Neither the undersigned, any member of the family of the undersigned, nor any affiliate of
the undersigned will be entitled to receive and will not accept any compensation for services
rendered to the Company prior to the consummation of the Business Combination; provided that the
undersigned shall also be entitled to reimbursement from the Company for his out-of-pocket expenses
incurred in connection with seeking and consummating a Business Combination.

     10. The undersigned authorizes any employer, financial institution, or consumer credit
reporting agency to release to FBW and its legal representatives or agents (including any
investigative search firm retained by FBW) any information they may have about the undersigned’s
background and finances (“Information”), purely for the purposes of the Company’s IPO (and
shall thereafter hold such information confidential). Neither FBW nor its agents shall be
violating the undersigned’s right of privacy in any manner in requesting and obtaining the
Information and the undersigned hereby releases them from liability for any damage whatsoever in
that connection.

     11. As used herein, (i) a “Business Combination” shall mean an acquisition by merger, capital
stock exchange, asset or stock acquisition, reorganization or otherwise, of an operating business
selected by the Company; (ii) “Insiders” shall mean all officers, directors and stockholders of the
Company immediately prior to the IPO; (iii) “Insider Shares” shall mean all of the shares of Common
Stock of the Company owned by an Insider prior to the IPO; and (iv) “IPO Shares’ shall mean the
shares of Common Stock issued in the Company’s IPO.

	 	 	 
	

	 	Herbert C. Williamson
	 
	 	 
	

	 	 
	

	 	Print Name of Insider
	 
	 	 
	

	 	/s/
	 
	 	 
	

	 	 
	

	 	Signatureexv10w5

 

Exhibit 10.5

INVESTMENT MANAGEMENT TRUST AGREEMENT

     This Agreement is made as of      , 2005 by and between JK Acquisition Corp. (the
“Company”) and Continental Stock Transfer & Trust Company (“Trustee”).

     WHEREAS, the Company’s Registration Statement on Form S-1, No. 333-125211 (“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, Ferris, Baker Watts, Incorporated (“FBW”) is acting as the sole underwriter
in the IPO; and

     WHEREAS, as described in the Company’s Registration Statement, and in accordance with the
Company’s Amended and Restated Certificate of Incorporation, $48,085,000 of the gross proceeds of
the IPO ($54,763,000 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, par value $.0001 per share, 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 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 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 Amegy Bank 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 Bill 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 FBW to do so;

          (h) Render to the Company and to FBW, 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

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          (i) 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 or Chairman of the Board and Secretary, 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 or Chairman of the Board. In
addition, except with respect to its duties under paragraph 1(i) 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 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; and

          (c) Pay the Trustee an initial acceptance fee of [___] and an annual
fee of [___] (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;

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          (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;

          (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(i) 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                     , 2007, 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(i).

     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; provided, however, that no such change, amendment
or modification may be made without the prior written consent of FBW. 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

17 Battery Place

New York, New York 10004

Attn: Steven Nelson

Fax No.: (212) 509-5150

          if to the Company, to:

JK Acquisition Corp.

5847 San Felipe, Suite 4350

Houston, Texas 77057

Attn: James P. Wilson — Chief Executive Officer

Fax No.: (713) 783-9750

          in either case with a copy to:

Ferris, Baker Watts, Inc.

7601 Lewinsville Road

Suite 450

McLean, Virginia 22102

Attn: Christopher A. Freeman

Fax No.: (703) 356-7641

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

          (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.

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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:
	 	 	Title:
	 
	 	 	 	 
	 	 	JK ACQUISITION CORP.
	

	 	By:	 	 
	

	 	 	 	 
	 	 	Name: Keith D. Spickelmier
	 	 	Title: President

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