EXHIBIT 99.2
AMENDED AND RESTATED
ESCROW AGREEMENT
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This Amended and Restated Escrow Agreement, dated as of January 26,
2004 (this "Agreement"), is by and among IPORUSSIA, INC., a Delaware corporation
(the "Company"), X.X. Xxxxxxxxxx & Co., Inc., a Massachusetts corporation
("Xxxxxxxxxx"), Xxxxxxx Securities Inc., a Delaware corporation ("Xxxxxxx" and,
with Xxxxxxxxxx, the "Underwriters"), and North Fork Bank, a New York banking
corporation (the "Escrow Agent").
WHEREAS, the Company and the Escrow Agent are parties to an Escrow
Agreement, dated as of April 16, 2003 (the "Existing Agreement"), which
contemplated an escrow arrangement in connection with the offering by the
Company, on a self-underwritten basis, of a minimum of 500,000 Shares (as
defined below); and
WHEREAS, the Company is proposing to offer up to 3.0 million shares of
its common stock, par value $.0001 per share (the "Shares"), pursuant to a
prospectus (the "Prospectus") which is to form a part of the Registration
Statement on Form SB-2, No. 333-98247, filed by the Company with the United
States Securities and Exchange Commission (the "SEC") (as same is declared
effective by the SEC, the "Registration Statement");
WHEREAS, pursuant to the Prospectus, the Company will now offer for
sale through the Underwriters, on an underwritten, best efforts basis (the
"Offering"), a minimum of 600,000 Shares (the "Minimum Offering") and a maximum
of 3.0 million Shares (the "Maximum Offering"), which Shares are to be offered
and sold at a purchase price of $1.00 per Share (the "Purchase Price");
WHEREAS, pursuant to the Prospectus, the proceeds to the Company from
the sale of the Shares are to be held in escrow pending the receipt of
subscriptions and the payment of the Purchase Price from subscribers for Shares
(each a "Subscriber"), acceptable to the Company and either Underwriter (each a
"Subscription"), for the Minimum Offering prior to the expiration of the
Offering Period (as hereafter defined) and one or more closings of the sale of
Shares to Subscribers under the Underwriting Agreement to be entered into among
the Company and the Underwriters (the "Underwriting Agreement"); and
WHEREAS, the Prospectus will provide that the Escrow Agent will serve
as escrow agent, which service will be on the terms and subject to the
conditions provided in this Agreement; and
WHEREAS, the parties hereto wish to amend, restate and completely
replace the Existing Agreement to reflect the revised terms of the Offering;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement, and
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree as follows:
1. Appointment of Escrow Agent: The Company and the Underwriters hereby
appoint the Escrow Agent as their agent and custodian for the purposes of this
Agreement, and the Escrow Agent accepts such appointment, each upon the terms
and subject to the conditions set forth in this Agreement.
2. Establishment of Escrow Account: The Escrow Agent has established an
interest-bearing account at the branch of the Escrow Agent located at 000
Xxxxxxxx Xxxx, Xxxxx Xxxxxxxxxxx, Xxx Xxxx 00000 (the "Branch"), which escrow
account is entitled, "For the Benefit of IPORUSSIA" (the "Escrow Account").
3. Deposits into the Escrow Account: All Subscribers' checks are to be
made payable to "NORTH FORK BANK, as escrow agent for IPORUSSIA." The checks
received from Subscribers whose Subscriptions have been accepted shall be
delivered, as contemplated by section 5 below, to an account representative at
the Branch for deposit into the Escrow Account. Upon receipt of such checks, the
Escrow Agent shall deposit them in the Escrow Account for collection as provided
in section 5. The Escrow Agent is not obligated, and may refuse, to accept
checks not accompanied by a Subscription (or photocopy of a Subscription)
containing the name, address and taxpayer identification number of each
Subscriber and the Purchase Price of the Shares subscribed for by such
Subscriber.
4. Escrow Period: The Offering shall expire ninety (90) days from the
effective date of the Registration Statement (the Company hereby agreeing to
notify the Escrow Agent of the effective date of the Registration Statement and
provide it with a copy of the Prospectus prior to the deposit of any monies
hereunder), unless extended for an additional period of up to ninety (90) days
at the sole discretion of the Company and the Underwriters and upon prior
written notice to the Escrow Agent signed by the Company and Xxxxxxxxxx on
behalf of the Underwriters (such initial or extended period is hereinafter
referred to as the "Offering Period.")
5. Deposit Into Escrow:
(a) The Underwriters shall deliver checks received from Subscribers
whose Subscriptions have been accepted, together with copies (which may be by
telecopy) of the Subscriptions (countersigned as acceptable by an Underwriter
and the Company), to the Branch. Upon receipt of such checks, the Escrow Agent
shall deposit them in the Escrow Account for collection.
(b) In the event a Subscriber's check for the Purchase Price is
received by the Company, the Company shall forward such check and a copy (which
may be by telecopy) of the Subscription (countersigned as acceptable by an
Underwriter and the Company) to the Branch. Upon receipt of such check, the
Escrow Agent shall deposit it in the Escrow Account for collection.
(c) In the event a Subscriber's check, together with a Subscription,
is received by the Escrow Agent directly from a Subscriber, the Escrow Agent
shall promptly forward a copy (which may be a telecopy) of the Subscription to
the Company. Upon receipt by the Escrow Agent of a copy (which may be a
telecopy) of the Subscription (countersigned as acceptable by the Company and an
Underwriter), the Escrow Agent shall deposit the check in the Escrow Account for
collection. Notwithstanding the foregoing, should a Subscription not be accepted
by the Company and an Underwriter within five (5) business days following the
Escrow Agent's
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delivery of a Subscription to the Company, the Escrow Agent shall return such
check to the Subscriber, noting that such Subscription was "Not Accepted."
(d) For purposes of this Agreement, a "business day" is a day other
than a Saturday or Sunday or other day on which the Escrow Agent is not open for
business in the State of New York.
(e) The Company and an Underwriter may sign and transmit accepted
Subscriptions to the Escrow Agent in counterparts.
(f) Upon receipt of collected funds representing the aggregate
Purchase Price for at least the Minimum Offering related to Subscriptions that
have been accepted by the Company and at least one Underwriter during the
Offering Period (the "Minimum Offering Proceeds"), the Escrow Agent shall
promptly deliver notice to the Company and the Underwriters by telecopy
confirming the Escrow Agent's receipt of such Minimum Offering Proceeds and
disburse such funds in accordance with section 6(a).
(g) In the event that the Minimum Offering Proceeds are disbursed in
accordance with section 6(a) of this Agreement, the Escrow Agent shall deposit
in the Escrow Account for collection any additional funds representing
Subscriptions accepted by the Company and an Underwriter that the Escrow Agent
receives, and shall disburse such funds in accordance with section 6(b).
(h) Until the expiration of the Offering Period, the Escrow Agent
shall maintain a list of (i) the name, address and taxpayer identification
number of each Subscriber, (ii) the number of Shares subscribed for by such
Subscriber, as accepted, and (iii) the aggregate Purchase Price received from
each Subscriber. The Escrow Agent shall provide a copy of the foregoing
information to the Company and the Underwriters periodically during the Offering
Period upon the request of the Company or an Underwriter and at the expiration
of the Offering Period.
6. Release from Escrow:
(a) (i) If, at any time prior to three (3) business days after the
expiration of the Offering Period, the Escrow Agent receives notice from an
Underwriter of a Closing Date under the Underwriting Agreement (the "Initial
Closing Date," and the closing to be held on the Initial Closing Date, the
"Initial Closing"), at the Initial Closing (upon receipt of a notice, which may
be by telecopy, from the Company and an Underwriter that the Closing has
contemporaneously been consummated subject to the collection of good funds and
payment to the Company for the Shares), the Escrow Agent shall pay by wire
transfer of immediately available funds to such accounts as the Company and the
Underwriters may designate in writing from good and collected funds in the
Escrow Account attributable to the Subscribers to whom Shares are to be issued
with respect to the Initial Closing: (A) to the Company, a sum equal to the
Purchase Price for the Shares being purchased by the Subscribers who delivered
such funds (and the interest earned thereon) less the difference between (x) 13%
of such Purchase Price and (y) $27,500, and (B) to the Underwriters, the balance
of the Purchase Price in such proportion as the Underwriters shall advise the
Escrow Agent. In addition, the Escrow Agent shall deliver to
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the Company and the Underwriters a list of the Subscribers and the number of
Shares being purchased by each such Subscriber.
(ii) If, at any time after the Initial Closing Date and prior to
three (3) business days following the expiration of the Offering Period, the
Escrow Agent receives notice from an Underwriter of a Closing Date for one or
more in addition to the Initial Closing (each an "Additional Closing"), at the
Additional Closing (upon receipt of a notice, which may be by telecopy, from the
Company and an Underwriter that such Additional Closing has contemporaneously
been consummated subject to the collection of good funds and payment to the
Company for the Shares) the Escrow Agent shall pay by wire transfer of
immediately available funds to such accounts as the Company and the Underwriters
may designate in writing from good and collected funds in the Escrow Account
attributable to the Subscribers to whom Shares are to be issued with respect to
such Additional Closing: (A) to the Company a sum equal to the Purchase Price
for the Shares being purchased by the Subscribers (and the interest earned
thereon) less 13% of such Purchase Price, and (B) to the Underwriters, the
balance in such proportion as the Underwriters shall advise the Escrow Agent. In
addition, the Escrow Agent shall deliver to the Company and the Underwriters a
list of the Subscribers and the number of Shares being purchased by each such
Subscriber.
(b) In the event (i) checks representing the Minimum Offering
Proceeds are not received by the Escrow Agent on or prior to the expiration of
the Offering Period, (ii) good and collected funds in an aggregate amount equal
to or greater than the Minimum Offering Proceeds are not in the Escrow Account
within ten (10) business days after the expiration of the Offering Period, (iii)
a Subscription is not timely accepted by the Company and an Underwriter, (iv) a
Closing has not been held within thirteen (13) business days after the
expiration of the Offering Period with respect to a Subscription, or (v) a
Subscription has been timely accepted but an Underwriter has instructed the
Escrow Agent in writing to return the applicable Purchase Price to the
Subscriber, then in any such event, the Escrow Agent shall promptly return the
Purchase Price to the applicable Subscriber(s). The Escrow Agent may return the
Purchase Price by returning the Subscriber's check or by delivering a check
drawn on the Escrow Agent in the amount received from such Subscriber, with the
interest (if any) earned thereon. Notwithstanding the foregoing, in no event
shall the Escrow Agent refund any part of the interest earned of a prospective
purchaser's Subscription deposit until such time as the Escrow Agent has
received an appropriate W-9 Form from a Subscriber who failed to complete the
Backup Withholding section in the Subscription.
(c) Notwithstanding the foregoing, the distribution of funds
pursuant to sections 6(a) and (b) shall not occur until the date on which said
good and collected funds have cleared.
7. Upon the disbursement of all funds in the Escrow Account pursuant to
this Agreement, the Escrow Agent will have no further responsibility with
respect to this Agreement. In this regard, it is expressly agreed and understood
that in no event shall the aggregate amount of payments made by the Escrow Agent
exceed the amount of the funds in the Escrow Account.
8. The Escrow Agent hereby accepts its obligations under this
Agreement, and represents and warrants that the Escrow Agent has the power and
legal authority to enter into this
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Agreement and to perform the Escrow Agent's obligations under this Agreement.
The Escrow Agent covenants and agrees that all property held by the Escrow Agent
pursuant to this Agreement shall be identified as being held in escrow in
connection with this Agreement. The Escrow Agent further covenants and agrees
that all documents and records with respect to the matters subject to and
transactions contemplated by this Agreement will be available, upon reasonable
written notice, for examination by the Company, either Underwriter, the SEC or
any state "blue sky" securities authorities.
9. For its services hereunder, the Escrow Agent shall be entitled to
receive from the Company: (a) a fee of $3,000.00, upon the execution and
delivery of this Agreement, and (b) reimbursement for any reasonable expenses
incurred by the Escrow Agent hereunder. The Escrow Agent shall not have a lien
upon, or any other right whatsoever to payment from, the property held by the
Escrow Agent pursuant to this Agreement, for or on account of such right to
payment and reimbursement or otherwise.
10. The parties hereto, for themselves, their successors and assigns,
do hereby acknowledge and agree that:
(a) This Escrow Agreement expressly sets forth all the duties and
obligations of the Escrow Agent with respect to any and all matters pertinent to
this Agreement, the Escrow Agent shall not have any duties or responsibilities
except as expressly set forth in this Agreement and no implied duties or
obligations shall be read into this Agreement against the Escrow Agent;
(b) The Escrow Agent shall be under no duty or obligation to
enforce the collection of any check, draft or other instrument for the payment
of money delivered to it hereunder, but the Escrow Agent, within a reasonable
time, shall return to the Subscriber any check, draft or other instrument
received which is dishonored, together with the Subscription;
(c) The Escrow Agent shall have no responsibility at any time to
ascertain whether or not any security interest exists in the funds in the Escrow
Account or any part thereof or to file any financing statement under the Uniform
Commercial Code with respect to the funds in the Escrow Account or any part
thereof.
(d) The Escrow Agent does not have any interest in the amounts
deposited hereunder but is serving as escrow holder only and having only
possession thereof;
(e) Any payments of income from this Agreement shall be subject to
withholding regulations then in force with respect to United States taxes;
(f) The Escrow Agent shall not have any investment responsibility
with respect to funds held under this Agreement, other than to deposit them in
an interest-bearing account;
(g) The Escrow Agent shall not be responsible for the identity,
authority or rights of any person, firm or corporation executing or delivering
or purporting to execute or deliver this Agreement or any document or amount
deposited hereunder or any endorsement thereon or assignment thereof;
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(h) The Escrow Agent shall not be responsible for the sufficiency,
genuineness or validity of, or title to, any document, instrument or amount
deposited or to be deposited with it pursuant to this Agreement;
(i) The Escrow Agent may rely and shall be protected in acting or
refraining from acting upon any written notice, instruction or request furnished
to it hereunder and believed by it to be genuine and to have been signed or
presented by the proper party or parties and the Escrow Agent shall be under no
duty to inquire into or investigate the validity, accuracy or content of any
such document;
(j) The Escrow Agent shall not have any duty to preserve rights
against any parties with respect to any funds held by the Escrow Agent pursuant
to this Agreement, whether or not the Escrow Agent has or is deemed to have
knowledge or notice of such matters;
(k) The Escrow Agent shall not be liable for any action taken in
accordance with the terms of this Agreement, including, without limitation, any
release of amounts held by the Escrow Agent pursuant to this Agreement;
(l) The Escrow Agent's duties hereunder are purely ministerial in
nature and the Escrow Agent shall not be liable or responsible for any act it
may do or omit except to the extent a court of competent jurisdiction located
within the State of New York determines its actions or inactions constituted
gross negligence or willful misconduct, and in no event shall the Escrow Agent
be liable for special, indirect or consequential loss or damage of any kind
whatsoever (including, but not limited to, lost profits), even if the Escrow
Agent has been advised of the likelihood of such loss or damage and regardless
of the form of action;
(m) The Escrow Agent shall not be required to institute legal
proceedings of any kind and shall not be required to defend any legal
proceedings which may be instituted against it in respect of the subject matter
of this Agreement and the instructions set forth herein, unless requested to do
so and indemnified to its satisfaction against the cost and expense of such
defense;
(n) In case any funds held by the Escrow Agent hereunder shall be
attached, garnished or levied upon under any order of court, or the delivery
thereof shall be stayed or enjoined by any order of court, or any other writ,
order, judgment or decree shall be entered or issued by any court affecting such
property, or any part thereof, or any act of the Escrow Agent, the Escrow Agent
is hereby expressly authorized, in its sole discretion and notwithstanding
anything in this Agreement to the contrary, to obey and comply with all writs,
orders, judgments or decrees so entered or issued, whether with or without
jurisdiction and, in case the Escrow Agent obeys and complies with any such
writ, order, judgment or decree, it shall not be liable to any of the parties
hereto, their affiliates, principals, successors or assigns, or to any other
person, firm or corporation, by reason of such compliance notwithstanding that
such writ, order, judgment or decree may subsequently be reversed, modified,
annulled, set aside or vacated; and
(o) The Escrow Agent may employ agents, attorneys and accountants
in connection with its duties hereunder and shall not be liable for any action
taken or omitted in
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good faith in accordance with the advice of counsel, accountants or other
skilled persons at the sole expense of the Company.
11. In the event of any disagreement between the Company or the
Underwriters and the Subscribers, or any other person, or any of them, resulting
in an adverse claim to funds held by the Escrow Agent pursuant to this
Agreement, the Escrow Agent shall be entitled, at the Escrow Agent's sole
option, to refuse to comply with any such claim and shall not be liable for
damages or interest to any such person or persons for its failure to comply with
such adverse claims, and the Escrow Agent shall be entitled to continue to so
refrain until:
(a) the rights of the adverse claimants shall have been finally
adjudicated by a court of competent jurisdiction; or
(b) all differences shall have been adjusted by agreement and the
Escrow Agent shall have been notified of such in a writing signed by all
interested persons.
In the event of such disagreement, the Escrow Agent, in the Escrow
Agent's sole discretion, may file a suit in interpleader for the purpose of
having the respective rights of the claimants of such funds or other property
adjudicated at the sole expense of the Company.
12. The Company and the Underwriters agree to indemnify the Escrow
Agent, and hold the Escrow Agent harmless, from and against any and all claims,
costs, expenses, demands, judgments, losses, damages and liabilities (including,
without limitation. reasonable attorneys' fees and expenses) arising out of or
in connection with this Agreement, including, without limitation, any fees
related to actions taken by the Escrow Agent pursuant to sections 10(l), 10(o),
11 and 12 of this Agreement, except such as may be caused by the gross
negligence or willful misconduct of the Escrow Agent.
13. The Escrow Agent may at any time resign by giving prior written
notice of such resignation to the Company and the Underwriters. The Escrow Agent
shall not be discharged from its duties and obligations under this Agreement
until a successor escrow agent shall have been designated by the Company and the
Underwriters and such successor escrow agent shall have executed and delivered
an escrow agreement in substantially the form of this Agreement, and all
property then held by the Escrow Agent pursuant to this Agreement shall have
been delivered to such successor escrow agent.
14. The term of this Agreement shall commence as of the date of this
Agreement and shall terminate upon the earliest to occur of the following:
(a) disbursement of all amounts held by the Escrow Agent pursuant
to section 6 of this Agreement and satisfaction of the Escrow Agent's other
duties and responsibilities under this Agreement;
(b) the appointment of, and acceptance of such appointment by, the
successor escrow agent under section 13; and
(c) termination of the Offering Period before the Escrow Agent's
receipt of any checks as provided in section 5.
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15. Except as otherwise specifically provided elsewhere in this
Agreement, all requests, demands, notices and other communications required or
otherwise given under this Agreement shall be sufficiently given if in writing
and (a) delivered by hand against written receipt therefor, (b) forwarded by
nationally recognized overnight courier requiring acknowledgment of receipt, (c)
mailed by registered or certified mail, return receipt requested or (d) sent by
telecopy with electronic confirmation, in each case with delivery charges
prepaid, as follows:
(a) If to the Company, to:
IPORUSSIA, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopy: 000-000-0000
with a copy (except that no copy of any communication pursuant to
section 5 of this Agreement need be given) to:
Jenkens & Xxxxxxxxx Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Telecopy: 000-000-0000
(b) If to the Xxxxxxxxxx:
X.X. Xxxxxxxxxx & Co., Inc.
000 Xxxx Xxxxxx, 00xx
Xxxxx Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxx,
President
Telecopy: 000-000-0000
with a copy (except that no copy of any communication pursuant to
section 5 of this Agreement need be given) to:
Snow Xxxxxx Xxxxxx P.C.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxx, Esq.
Telecopy: 000-000-0000
(c) If to Windham:
Xxxxxxx Securities, Inc.
000X Xxx Xxxxxx Xxxxx
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Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx,
President
Telecopy: 000-000-0000
with a copy (except that no copy of any communication pursuant to
section 5 of this Agreement need be given) to:
Xxxxx & Xxxxx
000 Xxxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxx, Esq.
Telecopy: 000-000-0000
(d) If to the Escrow Agent, to:
North Fork Bank, as Escrow Agent
000 Xxxxxxxx Xxxx
Xxxxx Xxxxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx,
Vice President
Telecopy: (000) 000-0000
with a copy (except that no copy of any communication pursuant to
section 5 of this Agreement need be given) to:
North Fork Bank
000 Xxxxx Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: The Office of the General Counsel
Telecopy: (000) 000-0000
or, in the case of any of the parties hereto, at such other address as such
party shall have furnished in writing, in accordance with this section, to the
other parties to this Agreement. Each such request, demand, notice or other
communication shall be deemed given (x) on the date of delivery by hand, (y) on
the first business day following the date of delivery to the nationally
recognized overnight courier or (z) three (3) business days following mailing by
registered or certified mail.
17. This Agreement shall be binding and inure to the benefit of the
parties to this Agreement and their respective successors and assigns. Nothing
in this Agreement is intended or shall be construed to give any other person any
right, remedy or claim under, in or with respect to this Agreement or any funds
held pursuant to this Agreement, except as specifically set forth in this
Agreement.
18. This Agreement shall be governed by, and be construed and
interpreted in accordance with, the internal laws of the State of New York.
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19. This Agreement may be entered into in any number of counterparts
and by different parties hereto in separate counterparts, each of which, when so
executed, shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
IPORUSSIA, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Secretary and Treasurer
X.X. XXXXXXXXXX & CO., INC.
By: /s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
President
XXXXXXX SECURITIES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
President
NORTH FORK BANK
By: /s/ Xxxxxxxx X. Xxxxxxxx
----------------------------------
Xxxxxxxx X. Xxxxxxxx
Vice President
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