Exhibit 10.2
INVESTMENT MANAGEMENT TRUST
AGREEMENT
This Agreement is
made as of ___, 2005 by and between Community Bankers Acquisition
Corp. (the “Company”) and Continental Stock Transfer
& Trust Company (the “Trustee”).
WHEREAS, the
Company’s Registration Statement on Form S-1,
No. 333-___(the “Registration Statement”), for its
initial public offering of securities (the “IPO”) has
been declared effective as of the date hereof by the Securities and
Exchange Commission (the “Effective Date”);
and
WHEREAS, I-Bankers
Securities Incorporated (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 Certificate of Incorporation,
$54,000,000 of the gross proceeds of the IPO ($62,100,000 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 $.01 per share, 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 (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 JPMorgan Chase NY 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 to do so;
(h) Render to
the Company and to the Representative, 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 receipt of and only in
accordance with the terms of a letter (the “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
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 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,
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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 $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 Trustee shall also be entitled to
reimbursement from the Company for all expenses paid or incurred by
it in the administration of its duties hereunder including, but not
limited to, all counsel, advisors’ and agents’ fees and
disbursements and all taxes or other governmental charges. The
Company shall not be responsible for any other fees or charges of
the Trustee except as set forth in this Section 2(c) and as may be
provided in paragraph 2(b) hereof (it being expressly understood
that the Property shall not be used to make any payments to the
Trustee under such paragraph).
3. Limitations of Liability. The
Trustee shall have no responsibility or liability to:
(a) Take any
action with respect to the Property, other than as directed in
paragraph 1 hereof and the Trustee shall have no liability to any
party except for liability arising out of its own gross negligence
or willful misconduct;
(b) Institute
any proceeding for the collection of any principal and income
arising from, or institute, appear in or defend any proceeding of
any kind with respect to, any of the Property unless and until it
shall have received instructions from the Company given as provided
herein to do so and the Company shall have advanced or guaranteed
to it funds sufficient to pay any expenses incident
thereto;
(c) Change
the investment of any Property, other than in compliance with
paragraph 1(c);
(d) Refund
any depreciation in principal of any Property;
(e) Assume
that the authority of any person designated by the Company to give
instructions hereunder shall not be continuing unless provided
otherwise in such designation, or unless the Company shall have
delivered a written revocation of such authority to the
Trustee;
(f) The other
parties hereto or to anyone else for any action taken or omitted by
it, or any action suffered by it to
