Common use of Escrow Release Clause in Contracts

Escrow Release. The Company shall remit written instructions to the Escrow Agent and the Investors two (2) business days after the Audit Date, in the form of Exhibit C attached hereto and made a part hereof, or in a form and substance satisfactory to the Escrow Agent, directing the Escrow Agent to release the Escrowed Shares within five (5) business days of the Audit Date for each fiscal year, as specified therein and in accordance with the following guidelines (the “Release Notice”): (a) One half of the Escrowed Shares (1,104,360) shall be allocated for each fiscal year (the “Yearly Shares”); any Escrowed Shares not distributed pursuant to the Release Notice regarding fiscal 2008, shall be held in Escrow and distributed in accordance herewith. (b) If the Company achieves 92% or less of the 2008 PT, then the Escrowed Shares shall be delivered as follows: (i) the Investors shall receive 73,624 shares for each percentage by which such threshold was not achieved (pro rata based on the number of shares of Preferred Stock owned by such Investor at such date) up to a maximum of 1,104,360 shares; (ii) if less than 500,000 shares are distributed pursuant to the calculation set forth in Section 1.4(b)(i) above, then the Management Team shall receive a total of 500,000 shares less the number of shares distributed pursuant Section 1.4(b), to be distributed pro rata among the Management Team based upon the percentages set forth in Exhibit A. (c) If the Company achieves 92% or less of the 2009 PT, then the Escrowed Shares shall be delivered as follows: (i) the Investors shall receive 73,624 shares for each percentage by which such threshold was not achieved (pro rata based on the number of shares of Preferred Stock owned by such Investor at such date) up to a maximum of 1,104,360 shares, plus any additional shares not distributed pursuant to Section 1.4(b) (d) If any Escrowed Shares remain in the Escrow Account after all of the disbursements are made pursuant to the 2009 Release Notice, the Escrow Agent shall return such remaining shares to the Management Team. (e) In the event that the Closing does not occur and written notice of same, signed by all of the parties hereto, is delivered to the Escrow Agent or upon the written instructions of all of the parties hereto, the Escrowed Agent shall return the Escrowed Shares to the Management Team. (f) Upon the Escrow Agent’s completion of its obligations under Section 1.4, this Agreement shall terminate and the Escrow Agent shall have no further liability hereunder.