Exhibit 10.3
INVESTMENT MANAGEMENT TRUST
AGREEMENT
This Agreement is made as of
February , 2006 by and between Oracle Healthcare
Acquisition Corp. (the “Company”) and Continental Stock
Transfer & Trust Company
(“Trustee”).
WHEREAS, the Company’s
Registration Statement on Form S-1, No. 333-128748, as
amended from time to time (“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, CRT Capital Group LLC (the
“Representative”) is acting as the representative of
the underwriters 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,
upon consummation of the IPO, $113,500,000 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”);
WHEREAS, pursuant to the
Underwriting Agreement, dated as of
February , 2006, between the Company
and the Representative, a portion of the Property equal to
$2,400,000 is attributable to deferred underwriting commissions
that will become payable by the Company to the underwriters upon
the consummation of a Business Combination (as defined in the
Registration Statement) (the “Deferred Discount”);
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 Lehman Brothers
Inc.;
(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
(i) any “Government Security,” which shall mean
any Treasury Bill issued by the United States government, having a
maturity of one hundred and eighty days or less; or (ii) any
open ended investment company selected by the Company registered
under the Investment Company Act of 1940 that holds itself out as a
money market fund and bears the highest (AAA) credit rating issued
by a United States nationally recognized rating agency such as
Standard & Poor’s Corporation or Moody’s
Investor Services, as determined by the Company;
(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 and the
Representative 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
to do so;
(h)
Render to the Company and to the
Representative, and to such other person as the Company may
instruct, in writing, monthly statements of the activities of and
amounts in the Trust Account reflecting all receipts in writing and
disbursements of the Trust Account;
(i)
If there is any income tax
obligation relating to the income of the Property in the Trust
Account, then, only at the written instruction of the Company, the
Trustee shall make 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 taxing authority (and not through the Company) by electronic
funds transfer, account debit or other method of payment;
provided , however , that if a taxing authority will
not accept payment in such manner, then any payment which would
have been made directly to the taxing authority may be made to the
Company, and the Company shall forward such payment to the taxing
authority; and
(j)
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 President or Chairman of the Board 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
(i) 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 and (ii) the Company has complied with
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Section 2(e) hereof prior to such
date), 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 (i) 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 and (ii) the Company has complied with
Section 2(e) hereof prior to such date), or as soon
thereafter as is practicable. In all cases, the Trustee shall
provide CRT with a copy of any Termination Letter and/or any other
correspondence that it receives with respect to any proposed
withdrawal from the Trust Account promptly after it receives the
same.
(k)
The distribution, if any, of the
Deferred Discount to the underwriters upon the liquidation of the
Trust Account as provided herein shall be made from the Trust
Account through the Trustee (and not through the Company) in
accordance with a written instruction of the
Representative.
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 President,
Chairman of the Board or Chief Financial Officer. 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;
(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
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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 in connection with a Business Combination, together with a
certified copy of a unanimous resolution of the Board of Directors
of the Company affirming that such letter of intent, agreement in
principle or definitive agreement is in effect; provided ,
however , that in the event any of the Company’s
directors are unable to participate in and approve such Business
Combination due to a pre-existing contractual or fiduciary
relationship, the Company shall provide the Trustee with a
certified copy of a resolution of
