STOCK ESCROW AGREEMENT
EXHIBIT
10.12
STOCK
ESCROW AGREEMENT, dated as of _____, 2006 (the "Agreement"),
by
and among INDUSTRIAL SERVICES ACQUISITION CORP., a Delaware corporation (the
"Company"),
XXXX
XXXXXX, XXXX XXXXXXXX, XXXXX XXXXX, XXXXXXX XXXXXXXX, XXXXXX X. XXXXXXXXX,
XXXX
XXXXXX, XXXXXX X. XXXXXXXXX, XXXX XXXXXXXXX , J. XXXX XXXXXXXXX and XXXXXX
XXXXXX (collectively the "Initial
Stockholders")
and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, a New York corporation (the
"Escrow
Agent").
WHEREAS,
the
Company has entered into an Underwriting Agreement, dated _____, 2006 (the
"Underwriting
Agreement"),
with
Maxim Group LLC ("Maxim")
acting
as representative of the several underwriters (collectively, the "Underwriters"),
pursuant to which, among other matters, the Underwriters have agreed to purchase
up to 5,175,000 units (the "Units")
of the
Company. Each Unit consists of one share of the Company's Common Stock, par
value $.0001 per share, and one Warrant, each Warrant to purchase one share
of
Common Stock, all as more fully described in the Company's final Prospectus,
dated _____, 2006 (the "Prospectus")
comprising part of the Company's Registration Statement on Form S-1 (File No.
333-127753) under the Securities Act of 1933, as amended (the "Registration
Statement"),
declared effective on _____, 2006 (the "Effective
Date").
WHEREAS,
the
Initial Stockholders have agreed as a condition of the sale of the Units to
deposit their shares of Common Stock of the Company, as set forth opposite
their
respective names in Exhibit A attached hereto (collectively the "Escrow
Shares"),
in
escrow as hereinafter provided.
WHEREAS,
the
Company and the Initial Stockholders desire that the Escrow Agent accept the
Escrow Shares, in escrow, to be held and disbursed as hereinafter
provided.
IT
IS AGREED:
1. Appointment
of Escrow Agent.
The
Company and the Initial Stockholders hereby appoint the Escrow Agent to act
in
accordance with and subject to the terms of this Agreement and the Escrow Agent
hereby accepts such appointment and agrees to act in accordance with and subject
to such terms.
2. Deposit
of Escrow Shares.
On or
before the Effective Date, each of the Initial Stockholders shall deliver to
the
Escrow Agent certificates representing his respective Escrow Shares, to be
held
and disbursed subject to the terms and conditions of this Agreement. Each
Initial Stockholder acknowledges that the certificate representing his Escrow
Shares is legended to reflect the deposit of such Escrow Shares under this
Agreement.
-1-
3. Disbursement
of the Escrow Shares.
The
Escrow Agent shall hold the Escrow Shares until the six month anniversary of
the
consummation of a Business Combination (as such term is defined in the
Registration Statement) (the "Escrow
Period"),
on
which date it shall, upon written instructions from each Initial Stockholder,
disburse each of the Initial Stockholder's Escrow Shares to such Initial
Stockholder; provided,
however,
that if
the Escrow Agent is notified by the Company pursuant to Section 6.7 hereof
that
the Company is being liquidated at any time during the Escrow Period, then
the
Escrow Agent shall promptly destroy the certificates representing the Escrow
Shares and; provided
further,
that
if, after the Company consummates a Business Combination, it (or the surviving
entity) subsequently consummates a liquidation, merger, stock exchange or other
similar transaction which results in all of the stockholders of such entity
having the right to exchange their shares of Common Stock for cash, securities
or other property, then the Escrow Agent will, upon receipt of a certificate,
executed by the Chief Executive Officer or Chief Operating Officer of the
Company, in form reasonably acceptable to the Escrow Agent, that such
transaction is then being consummated, release the Escrow Shares to the Initial
Stockholders upon consummation of the transaction so that they can similarly
participate. The Escrow Agent shall have no further duties hereunder after
the
disbursement or destruction of the Escrow Shares in accordance with this Section
3.
4. Rights
of Initial Stockholders in Escrow Shares.
4.1 Voting
Rights as a Stockholder.
Subject
to the terms of the Insider Letter described in Section 4.4 hereof and except
as
herein provided, the Initial Stockholders shall retain all of their rights
as
stockholders of the Company during the Escrow Period, including, without
limitation, the right to vote such shares.
4.2 Dividends
and Other Distributions in Respect of the Escrow Shares.
During
the Escrow Period, all dividends payable in cash with respect to the Escrow
Shares shall be paid to the Initial Stockholders, but all dividends payable
in
stock or other non-cash property (the "Non-Cash
Dividends")
shall
be delivered to the Escrow Agent to hold in accordance with the terms hereof.
As
used herein, the term "Escrow Shares" shall be deemed to include the Non-Cash
Dividends distributed thereon, if any.
4.3 Restrictions
on Transfer.
During
the Escrow Period, no sale, transfer or other disposition may be made of any
or
all of the Escrow Shares except (i) by gift to a member of Initial Stockholder's
immediate family or to a trust, the beneficiary of which is an Initial
Stockholder or a member of an Initial Stockholder's immediate family, (ii)
by
virtue of the laws of descent and distribution upon death of any Initial
Stockholder, or (iii) pursuant to a qualified domestic relations order;
provided,
however,
that
such permissive transfers may be implemented only upon the respective
transferee's written agreement to be bound by the terms and conditions of this
Agreement and of the Insider Letter signed by the Initial Stockholder
transferring the Escrow Shares. During the Escrow Period, the Initial
Stockholders shall not pledge or grant a security interest in the Escrow Shares
or grant a security interest in their rights under this Agreement.
-2-
filed
as
an exhibit to the Registration Statement (the "Insider
Letter"),
respecting the rights and obligations of such Initial Stockholder in certain
events, including but not limited to the liquidation of the
Company.
5. Concerning
the Escrow Agent.
5.1 Good
Faith Reliance.
The
Escrow Agent shall not be liable for any action taken or omitted by it in good
faith and in the exercise of its own best judgment, and may rely conclusively
and shall be protected in acting upon any order, notice, demand, certificate,
opinion or advice of counsel (including counsel chosen by the Escrow Agent),
statement, instrument, report or other paper or document (not only as to its
due
execution and the validity and effectiveness of its provisions, but also as
to
the truth and acceptability of any information therein contained) which is
believed by the Escrow Agent to be genuine and to be signed or presented by
the
proper person or persons. The Escrow Agent shall not be bound by any notice
or
demand, or any waiver, modification, termination or rescission of this Agreement
unless evidenced by a writing delivered to the Escrow Agent signed by the proper
party or parties and, if the duties or rights of the Escrow Agent are affected,
unless it shall have given its prior written consent thereto.
5.2 Indemnification.
The
Escrow Agent shall be indemnified and held harmless by the Company from and
against any expenses, including counsel fees and disbursements, or loss suffered
by the Escrow Agent in connection with any action, suit or other proceeding
involving any claim which in any way, directly or indirectly, arises out of
or
relates to this Agreement, the services of the Escrow Agent hereunder, or the
Escrow Shares held by it hereunder, other than expenses or losses arising from
the gross negligence or willful misconduct of the Escrow Agent. Promptly after
the receipt by the Escrow Agent of notice of any demand or claim or the
commencement of any action, suit or proceeding, the Escrow Agent shall notify
the other parties hereto in writing. In the event of the receipt of such notice,
the Escrow Agent, in its sole discretion, may commence an action in the nature
of interpleader in an appropriate court to determine ownership or disposition
of
the Escrow Shares or it may deposit the Escrow Shares with the clerk of any
appropriate court or it may retain the Escrow Shares pending receipt of a final,
non-appealable order of a court having jurisdiction over all of the parties
hereto directing to whom and under what circumstances the Escrow Shares are
to
be disbursed and delivered. The provisions of this Section 5.2 shall survive
in
the event the Escrow Agent resigns or is discharged pursuant to Sections 5.5
or
5.6 below.
5.3 Compensation.
The
Escrow Agent shall be entitled to reasonable compensation from the Company
for
all services rendered by it under the specific terms of this Agreement. The
Escrow Agent shall also be entitled to reimbursement from the Company for all
reasonable 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, subject to the
prior written consent of the Company, not to be unreasonably
withheld.
5.4 Further
Assurances.
From
time to time on and after the date hereof, the Company and the Initial
Stockholders shall deliver or cause to be delivered to the Escrow
Agent
-3-
such
further documents and instruments and shall do or cause to be done such further
acts as the Escrow Agent shall reasonably request to carry out more effectively
the provisions and purposes of this Agreement, to evidence compliance herewith
or to assure itself that it is protected in acting hereunder.
5.6 Discharge
of Escrow Agent.
The
Escrow Agent shall resign and be discharged from its duties as escrow agent
hereunder if so requested in writing at any time by the Company and a majority
of the Initial Stockholders, jointly, provided,
however,
that
such resignation shall become effective only upon acceptance of appointment
by a
successor escrow agent as provided in Section 5.5.
5.7 Liability.
Notwithstanding anything herein to the contrary, the Escrow Agent shall not
be
relieved from liability hereunder for its own gross negligence or its own
willful misconduct.
5.8 Waiver.
The
Escrow Agent hereby waives any and all right, title, interest or claim of any
kind (“Claim”) in or to any distribution of the Trust Fund (as defined in that
certain Investment Management Trust Agreement, dated as of the date hereof,
by
and between the Company and the Escrow Agent), and hereby agrees not to seek
recourse, reimbursement, payment or satisfaction for any Claim against the
Trust
Fund for any reason whatsoever.
6. Miscellaneous.
6.1 Governing
Law.
This
Agreement shall for all purposes be deemed to be made under and shall be
construed in accordance with the laws of the State of New York, without regard
to the conflicts of laws principles thereof.
6.2 Third
Party Beneficiaries.
Each of
the Initial Stockholders, the Company, and Escrow Agent hereby specifically
acknowledge and agree that the Underwriters are third party beneficiaries of
this Agreement and this Agreement may not be modified or changed without the
prior written consent of Maxim.
6.3 Entire
Agreement.
This
Agreement contains the entire agreement of the parties hereto with respect
to
the subject matter hereof and, except as expressly provided herein, may not
be
changed or modified except by an instrument in writing signed by the party
to be
charged.
-4-
6.4 Headings.
The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation thereof.
6.5 Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the respective
parties hereto and their legal representatives, successors and
assigns.
6.6 Notices.
Any
notice or other communication required or which may be given hereunder shall
be
sufficiently given when so delivered if by hand or overnight delivery or if
sent
by certified mail or private courier service within five days after deposit
of
such notice, postage prepaid, or sent by facsimile transmission (with
confirmation of receipt), addressed as follows:
Continental
Stock Transfer & Trust Company
00
Xxxxxxx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Chairman
with
a
copy in each case to:
Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx X. Xxxx, Esq.
Fax:
(000) 000-0000
and:
Maxim
Group LLC
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxxx Xxxxxx, Managing Director
Fax:
(000) 000-0000
and:
Xxxxxxxxxx
Xxxxxxx PC
00
Xxxxxxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxxxx 00000
Attn:
Xxxxxx Xxxxxxxx, Esq.
Fax:
(000) 000-0000
The
parties may change the persons and addresses to which the notices or other
communications are to be sent by giving written notice to any such change in
the
manner provided herein for giving notice.
-5-
6.7 Liquidation
of Company.
The
Company shall give the Escrow Agent written notification of the liquidation
and
dissolution of the Company in the event that the Company fails to consummate
a
Business Combination within the time period(s) specified in the
Prospectus.
-6-
WITNESS
the execution of this Agreement as of the date first above written.
INDUSTRIAL
SERVICES AGREEMENT CORP.
By:___________________________
Name:
Title:
INITIAL
STOCKHOLDERS
___________________________
Xxxx
Xxxxxx
___________________________
Xxxx
XxXxxxxx
___________________________
Xxxxx
Xxxxx
___________________________
Xxxxxxx
Xxxxxxxx
___________________________
Xxxxxx
X.
Xxxxxxxxx
___________________________
Xxxx
Xxxxxx
___________________________
Xxxxxx
X.
Xxxxxxxxx
___________________________
Xxxx
Xxxxxxxxx
-7-
___________________________
J.
Xxxx
Xxxxxxxxx
___________________________
Xxxxxx
Xxxxxx
CONTINENTAL
STOCK TRANSFER
&
TRUST COMPANY
By:________________________
Name:
Title:
-8-
EXHIBIT
A
|
Name
and Address of
|
Number
|
Stock
|
Date
of
|
|||||||
|
Initial
Stockholder
|
of
Shares
|
Certificate
Number
|
Insider
Letter
|
|||||||
|
Xxxx
Xxxxxx
|
||||||||||
|
363,912
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxx
XxXxxxxx
|
||||||||||
|
363,912
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxxx
Xxxxx
|
||||||||||
|
194,694
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxxxxx
Xxxxxxxx
|
||||||||||
|
14,241
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxxxx
X. Xxxxxxxxx
|
||||||||||
|
12,460
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxx
Xxxxxx
|
||||||||||
|
12,460
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxxxx
X. Xxxxxxxxx
|
||||||||||
|
122,379
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxx
Xxxxxxxxx
|
||||||||||
|
16,021
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
-9-
|
Name
and Address of
|
Number
|
Stock
|
Date
of
|
|||||||
|
Initial
Stockholder
|
of
Shares
|
Certificate
Number
|
Insider
Letter
|
|||||||
|
J.
Xxxx Xxxxxxxxx
|
||||||||||
|
14,241
|
||||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
|
Xxxxxx
Xxxxxx
|
||||||||||
|
c/o
Industrial Services Acquisition Corp.
|
10,680
|
|||||||||
|
0000
Xx Xxxxxxxx Xxxxxx
|
||||||||||
|
Xxxxxx
XX 00000
|
||||||||||
-10-
