Common use of Release of Escrowed Shares Clause in Contracts

Release of Escrowed Shares. The Escrowed Shares shall be distributed as follows: a. upon the written instruction of the Shareholder Parties to the Escrow Agent owning at least 85% of the Escrowed Shares, the Escrow Agent shall distribute the respective portions of the Escrowed Shares to the respective Shareholder Parties, or deliver such Escrowed Shares to a successor Escrow Agent as instructed in such written notice; or b. with respect to any or all of the Escrowed Shares of a specific Shareholder Party, upon the written instruction of such Shareholder Party (a "Rule 144 Selling Shareholder Party") that any such shares have been sold pursuant to Rule 144 (as defined in Section 3.1 below) (such shares as sold pursuant to Rule 144, the "Rule 144 Shares") accompanied by the written certification of OTG that it has received an opinion of legal counsel as provided in Section 3.1, the Escrow Agent shall deliver such Rule 144 Shares so sold as the Rule 144 Selling Shareholder Party shall direct in its written instruction; provided, however, that the Shareholder Parties agree hereby that: (i) the proceeds of any such sale by a Rule 144 Selling Shareholder Party pursuant to Rule 144 ("Rule 144 Proceeds") shall be shared among the Shareholder Parties pro rata according to their respective amounts of Escrowed Shares, where such pro rata amounts shall be determined as if all shares of Series C Preferred shall have been converted to Common Stock and the Rule 144 Shares had not been sold; (ii) the Rule 144 Proceeds shall be distributed by the Rule 144 Selling Shareholder Party to the Shareholder Parties within 5 business days of the receipt of such proceeds by the Rule 144 Selling Shareholder Party; and (iii) within 5 business days following the receipt by the Shareholder Parties (excluding the Rule 144 Selling Shareholder Party, the "Other Shareholder Parties") of their portion of the Rule 144 Proceeds, the Other Shareholder Parties each shall, or shall cause, the Transfer to the Rule 144 Selling Shareholder Party of that amount of such Other Shareholder Party's Escrowed Shares equal to their pro rata portion of the Rule 144 Shares, where such pro rata portion shall be as determined in Section 2.3(b)(i) above.

Release of Escrowed Shares. The (a) In the event that a Xybernaut Indemnitee, (as defined in the Merger Agreement) determines that there exists a claim for which it is entitled to be reimbursed or indemnified pursuant to the Merger Agreement, such Xybernaut Indemnitee shall be entitled to assert a claim in writing (an "Asserted Claim") against the Escrowed Shares shall be distributed in respect of each such claim and amount, as follows: a. upon the written instruction case may be, by notifying the Shareholders Representative (with a copy of the Shareholder Parties notification to the Escrow Agent) in reasonable detail of the basis and amount of such Asserted Claim. If, within twenty (20) days after the sending of such notice by the Xybernaut Indemnitee, the Escrow Agent owning shall not have received from the Shareholders Representative a written statement disputing all or any part of such Asserted Claim, then the Escrow Agent shall deliver to a Xybernaut Indemnitee such number of the Escrowed Shares as may be available and as may be necessary to pay the amount of such Asserted Claim in full. If, within twenty (20) days after the sending of such notice by the Xybernaut Indemnitee, the Xybernaut Indemnitee and the Escrow Agent shall have received from the Shareholders Representative a written statement disputing all or a portion of such Asserted Claim, then the Xybernaut Indemnitee may order the Escrow Agent to deliver to the Xybernaut Indemnitee such number of the Escrowed Shares as may be available and as may be necessary to pay any portion of such Asserted Claim that is not disputed, and the Escrow Agent shall promptly follow such instructions. The Xybernaut Indemnitee shall have the right to notify the indemnifying party of Asserted Claims at least 85% any time and from time to time, subject to the provisions of the Merger Agreement. (b) In the event that the Shareholders Representative disputes all or a portion of any Asserted Claim within the time and in the manner prescribed in Section 3(a) hereof, the Escrow Agent shall have the right to act in accordance with Section 5 hereof and shall not release any disputed Escrowed Shares until (i) receipt by the Escrow Agent of joint written instructions from the Xybernaut Indemnitee and the Shareholders Representative, directing the manner in which payment of such amounts is to be made, or (ii) as directed by final order of a court of competent jurisdiction which is not subject to further appeal or other appellate review, together with an opinion of counsel to the party which successfully sought such order (or if no party sought such order, then of counsel reasonably acceptable to the Escrow Agent) to the effect that such order is not appealable. (c) Subject to the foregoing and all of the other provisions hereof, as soon as reasonably practical following the first anniversary of the Closing Date (as defined in the Merger Agreement), the Escrow Agent shall release the Escrowed Shares then held by it to the Shareholders Representative. (d) In the event that a Xybernaut Indemnitee is entitled to direct the Escrow Agent to deliver to it any Escrowed Shares deposited in Escrow hereunder (the "Indemnity Shares") on account of an Asserted Claim, the parties hereby authorize the Escrow Agent to complete the stock powers deposited with such Indemnity Shares so as to effect the assignment of the Indemnity Shares to the Xybernaut Indemnitee in accordance with the Principal Shareholders' respective proportionate ownership of the Escrowed Shares, the Escrow Agent shall distribute the respective portions net of the Escrowed Shares to the respective Shareholder Partiesany required tax or other withholding or deduction, or deliver such Escrowed Shares to a successor Escrow Agent as instructed in such written notice; or b. with respect to any or all of the Escrowed Shares of a specific Shareholder Party, upon the written instruction of such Shareholder Party (a "Rule 144 Selling Shareholder Party") that any such shares have been sold pursuant to Rule 144 (as defined in Section 3.1 below) (such shares as sold pursuant to Rule 144, the "Rule 144 Shares") accompanied by the written certification of OTG that it has received an opinion of legal counsel as provided in Section 3.1, whereupon the Escrow Agent shall deliver such Rule 144 the Indemnity Shares so sold and related stock powers to the Company for reissuance to Xybernaut and the Principal Shareholders in accordance with the foregoing, and Xybernaut hereby agrees to take all actions as the Rule 144 Selling Shareholder Party shall direct in its written instruction; provided, however, that the Shareholder Parties agree hereby that: (i) the proceeds of any such sale by a Rule 144 Selling Shareholder Party pursuant to Rule 144 ("Rule 144 Proceeds") shall be shared among necessary or appropriate to effect the Shareholder Parties pro rata according to their respective amounts of Escrowed Shares, where such pro rata amounts shall be determined as if all shares of Series C Preferred shall have been converted to Common Stock and the Rule 144 Shares had not been sold; (ii) the Rule 144 Proceeds shall be distributed by the Rule 144 Selling Shareholder Party to the Shareholder Parties within 5 business days of the receipt of such proceeds by the Rule 144 Selling Shareholder Party; and (iii) within 5 business days following the receipt by the Shareholder Parties (excluding the Rule 144 Selling Shareholder Party, the "Other Shareholder Parties") of their portion of the Rule 144 Proceeds, the Other Shareholder Parties each shall, or shall cause, the Transfer to the Rule 144 Selling Shareholder Party of that amount of such Other Shareholder Party's Escrowed Shares equal to their pro rata portion of the Rule 144 Shares, where such pro rata portion shall be as determined in Section 2.3(b)(i) aboveforegoing.

Release of Escrowed Shares. 5.1 The Escrowed Shares shall be distributed as follows: a. upon the written instruction of the Shareholder Parties to held in escrow by the Escrow Agent owning at least 85% until such Escrowed Shares shall be released from escrow in accordance with the escrow release schedule set forth in: P a g e | 4 (a) Schedule “B” in the case of Escrowed Shares registered to XXXXXX and XXXXXXX (together, the “Noteholder Escrowed Parties”); and (b) Schedule “C” in the case of the Escrowed Shares registered to the Securityholders other than the Noteholder Escrowed Parties (collectively, the “Equityholder Escrowed Parties). 5.2 Despite any other provision in this Agreement, the Escrow Agent is hereby irrevocably authorized and directed to release the Escrowed Shares: (a) upon receipt of a written direction from the Corporation (as authorized by the board of directors of the Corporation) directing the Escrow Agent to deal with the Escrowed Shares in such manner as set out therein;; (b) upon receipt of a notarial copy of a court order of a court of competent jurisdiction directing the Escrow Agent to deal with the Escrowed Shares, or any part thereof, in such manner as the court deems fit, which order has not been appealed and which order shall be deemed to be full and sufficient authority to deal with the Escrowed Shares in the manner and on the terms set forth therein; or (c) if the Escrow Agent is terminated or resigns as contemplated in sections 7.1(d) and (e), the Escrow Agent shall forthwith transfer the Escrowed Shares to the succeeding escrow agent. 5.3 To the extent a release from escrow of Escrowed Shares could result in a fractional Escrowed Share, such fractional Escrowed Share shall only be released from escrow in combination with other fractional Escrowed Shares that would result in a whole number of Escrowed Shares. No fractional Escrowed Shares shall be released from escrow. 5.4 Immediately upon the release from escrow of Escrowed Shares, the Escrow Agent shall distribute the respective portions deliver to each of the Escrowed Shares to Securityholders thereto all share certificates representing the respective Shareholder Parties, or deliver such Escrowed Shares to a successor Escrow Agent as instructed in such written notice; or b. with respect to any or all of the Escrowed Shares of a specific Shareholder Party, upon the written instruction of such Shareholder Party (a "Rule 144 Selling Shareholder Party") that any such shares have been sold pursuant to Rule 144 (as defined in Section 3.1 below) (such shares as sold pursuant to Rule 144, the "Rule 144 Shares") accompanied by the written certification of OTG that it has received an opinion of legal counsel as provided in Section 3.1, the Escrow Agent shall deliver such Rule 144 Shares so sold as the Rule 144 Selling Shareholder Party shall direct in its written instruction; provided, however, that the Shareholder Parties agree hereby that: (i) the proceeds of any such sale by a Rule 144 Selling Shareholder Party pursuant to Rule 144 ("Rule 144 Proceeds") shall be shared among the Shareholder Parties pro rata according to their respective amounts of released Escrowed Shares, where such pro rata amounts shall be determined as if all shares of Series C Preferred shall have been converted to Common Stock and the Rule 144 Shares had not been sold; (ii) the Rule 144 Proceeds shall be distributed by the Rule 144 Selling Shareholder Party to the Shareholder Parties within 5 business days of the receipt of such proceeds by the Rule 144 Selling Shareholder Party; and (iii) within 5 business days following the receipt by the Shareholder Parties (excluding the Rule 144 Selling Shareholder Party, the "Other Shareholder Parties") of their portion of the Rule 144 Proceeds, the Other Shareholder Parties each shall, or shall cause, the Transfer to the Rule 144 Selling Shareholder Party of that amount of such Other Shareholder Party's Escrowed Shares equal to their pro rata portion of the Rule 144 Shares, where such pro rata portion shall be as determined in Section 2.3(b)(i) above.