SECURITIES ESCROW AGREEMENT
THIS
SECURITIES ESCROW AGREEMENT, dated as of _________, 2008 (this “Agreement”),
by
and among Xxxxxxxxxxx Acquisition Corp. , a Delaware corporation (the
“Company”),
each
of the parties set forth on Exhibit A annexed hereto (collectively the
“Private
Investors”)
and
American Stock Transfer & Trust Company (the “Escrow
Agent”).
WHEREAS,
the Company has entered into an Underwriting Agreement, dated __________, 2008
(the “Underwriting
Agreement”),
with
Credit Suisse Securities (USA) LLC (“Credit
Suisse”)
acting
as underwriter (the “Underwriter”),
pursuant to which, among other matters, the Underwriter has agreed to purchase
37,500,000 units of the Company plus an additional 5,625,000 units if the
Underwriter exercises its over-allotment option in full. The Company’s units
(the “Units”) each consist of one share of the Company’s common stock, par value
$0.001 per share (the “Common
Stock”),
and
one warrant (the “Warrant”)
exercisable to purchase one share of Common Stock, all as more fully described
in the Company’s final Prospectus, dated ___________, 2008, comprising part of
the Company’s Registration Statement on Form S-1 (File No. 333-______) (the
“Registration
Statement”)
filed
under the Securities Act of 1933, as amended, and declared effective by the
Securities and Exchange Commission on _________, 2008 (the “Effective
Date”);
WHEREAS,
each of the Private Investors has agreed as a condition of the Underwriter’s
purchase of the Units to deposit its Units, as set forth opposite each Private
Investor’s name on Exhibit A attached hereto (the “Founder
Units”),
in
escrow as hereinafter provided;
WHEREAS,
the Private Investors have agreed as a condition of the Underwriter’s purchase
of the Units to purchase an aggregate of 6,000,000 Warrants for $1.00 per
Warrant (the “Sponsor
Warrants”
and,
collectively with the Founder Units, the shares of Common Stock underlying
the
Founder Units and the Warrants underlying the Founder Units, the “Escrow
Securities”)
immediately prior to and subject to the Closing and to deposit such Sponsor
Warrants in escrow as hereinafter provided; and
WHEREAS,
the Company and the Private Investors desire that the Escrow Agent accept the
Escrow Securities, in escrow, to be held and disbursed as hereinafter
provided.
IT
IS
AGREED:
1. Appointment
of Escrow Agent.
The Company and the Private Investors 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 Securities.
2.1. Founder
Units.
On or
about the Effective Date, each of the Private Investors shall deliver to the
Escrow Agent certificates representing such Private Investor’s respective
Founder Units as set forth opposite their respective names on Exhibit A hereto,
which certificates shall remain in the name of such Private Investor, to be
held
and disbursed subject to the terms and conditions of this Agreement. Each
Private Investor acknowledges that the certificate representing such Private
Investor’s Founder Units bears a legend to reflect the deposit of such Founder
Units under this Agreement.
2.2 Private
Placement Securities.
Promptly following the consummation of the Offering, each of the Private
Investors shall deliver to the Escrow Agent certificates representing such
Private Investor’s respective Sponsor Warrants as
set
forth opposite their respective names on Exhibit A attached hereto,
which certificates shall remain in the name of such Private Investor or such
Private Investor’s Permitted Transferee, as applicable, to be held and disbursed
subject to the terms and conditions of this Agreement. Each Private Investor
acknowledges that the certificates representing such Private Investor’s
Sponsor Warrants
shall bear a legend to reflect the deposit of such securities under this
Agreement.
1
3. Disbursement
of the Escrow Securities. The
Escrow Agent shall hold the Founder Units until the first anniversary of the
consummation of a Business Combination (as such term is defined in the Amended
and Restated Articles of Incorporation of the Company) and shall hold the
Sponsor Warrants
until
the 90th
day
after the consummation of a Business Combination (each such period, an
“Escrow
Period”);
provided,
however,
that if
the over-allotment granted to the Underwriter pursuant to the Underwriting
Agreement is not exercised in full prior to the expiration of the over-allotment
option, then the Escrow Agent shall release to the Company such number of
Founder Units as directed in writing by the Company. The Company shall promptly
provide notice of the consummation of a Business Combination to the Escrow
Agent. Upon the completion of each Escrow Period, the Escrow Agent shall
automatically disburse the applicable Escrow Securities to each Private Investor
upon receipt of written request therefor from the Company; provided,
however,
that if
the Escrow Agent is notified by the Company pursuant to Section 6.7 hereof
that
the Company has been liquidated at any time during the Escrow Period, then
the
Escrow Agent shall promptly destroy the certificates representing the Escrow
Securities; provided
further, however,
that if
the consummation of a Business Combination takes the form of a merger, stock
exchange or other similar transaction which results in any of the security
holders of the Company having the right to exchange their securities for other
securities, then the Escrow Agent shall, upon receipt of a certificate in form
reasonably acceptable to the Escrow Agent, executed by the Chief Executive
Officer of the Company, release the Escrow Securities to the Private Investors
immediately prior and subject to consummation of the Business Combination so
that they can similarly participate, and upon receipt of the securities issued
in respect thereof in connection with the Business Combination, the Private
Investors shall deposit such securities into escrow with the Escrow Agent for
the remainder of the applicable Escrow Periods; and provided
further, however,
that
if, after the Company consummates a Business Combination and the Company or
the
surviving entity of such Business Combination subsequently consummates a
liquidation, merger, stock exchange or other similar transaction which results
in any of the security holders of the Company or such entity having the right
to
exchange their securities for cash, securities or other property, then the
Escrow Agent shall, upon receipt of a certificate in form reasonably acceptable
to the Escrow Agent, executed by the Chief Executive Officer of the Company,
that such transaction is then being consummated, release the Escrow Securities
to the Private Investors immediately prior and subject to consummation of the
transaction so that they can similarly participate. The Escrow Agent shall
act
as soon as reasonably possible following the receipt of the certificate, and
shall not be held liable for any delay in sending the Escrow Securities caused
by the late receipt of the certificate. The Escrow Agent shall have no further
duties hereunder with respect to the Escrow Securities after the disbursement
or
destruction of the Escrow Securities in accordance with this Section
3.
4. Rights
of Private Investors in Escrow Securities.
4.1.
Rights
as a Security Holder.
Subject
to the terms of their respective Insider Letters as described in Section 4.4
hereof and except as herein provided, each Private Investor shall retain all
of
its rights as a stockholder of the Company during the Escrow Period, including
without limitation, the right to vote Common Stock. The Escrow Agent shall
have
no responsibility to determine or verify the contents or limitations of the
Insider Letters and shall be bound only by the terms of this
Agreement.
4.2. Dividends
and other Distributions in Respect of the Escrow Securities.
During
the Escrow Period with respect to the Escrow Securities, all dividends payable
in cash with respect to the Escrow Securities shall be paid to the Private
Investors, 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 terms “Escrow
Securities”
shall
be deemed to include the Non-Cash Dividends distributed thereon, if
any.
2
4.3. Restrictions
on Transfer and Redemption.
During
the Escrow Period, no sale, transfer or other disposition (a “Transfer”)
may be
made of any or all of the Escrow Securities by a Private Investor except (i)
by
gift to a member of the Private Investor’s immediate family for estate planning
purposes or to a trust, the beneficiary of which is the Private Investor or
a
member of the Private Investor’s immediate family, (ii) if the Private Investor
is not a natural person, by gift to a member of the immediate family of such
Private Investor’s controlling person for estate planning purposes or to a
trust, the beneficiary of which is such Private Investor’s controlling person or
a member of the immediate family of such Private Investor’s controlling person,
(iii) by virtue of the laws of descent and distribution upon death of the
Private Investor, or (iv) pursuant to a qualified domestic relations order
(each
such transferee, a “Permitted
Transferee”);
provided, however,
that
such permitted Transfers may be implemented only upon the respective Permitted
Transferee’s written agreement to be bound by the terms and conditions of this
Agreement and of the Insider Letter signed by such Private Investor transferring
such Escrow Securities and such other documents as the Company or Credit Suisse
may reasonably require. During the Escrow Period, no Private Investor shall
pledge or grant a security interest in such Private Investor’s Escrow Securities
or grant a security interest in such Private Investor’s rights under this
Agreement.
4.4. Insider
Letters.
Each of the Private Investors has executed a letter agreement with the Company
and Credit Suisse, which has been filed as an exhibit to the Registration
Statement (the “Insider
Letter”),
with respect to the rights and obligations of such Private Investors 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 be protected and shall not be liable for any action taken
or
omitted by it in good faith and in the exercise of its best judgment (unless
grossly negligent), and may rely conclusively and may act upon any order,
notice, demand, certificate, opinion or advice of counsel (including counsel
chosen by the Escrow Agent), statement, instrument, report or other document
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 reasonable counsel fees and disbursements,
or
losses 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 Securities 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 Securities or it may deposit the Escrow Securities
with the clerk of any appropriate court or it may retain the Escrow Securities
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 Securities are to be disbursed and delivered. The provisions of
Sections 5.2 and 5.7 shall survive in the event the Escrow Agent resigns or
is
discharged pursuant to Sections 5.5 or 5.6 below and in the event of termination
under 6.11 below.
3
5.3. Compensation.
The
Escrow Agent shall be entitled to compensation from the Company in accordance
with Schedule I hereto for all services rendered by it hereunder.
5.4. Further
Assurances.
From
time to time on and after the date hereof, the Company and the Private Investors
shall deliver or cause to be delivered to the Escrow Agent 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.
5.5. Resignation.
The
Escrow Agent may resign at any time and be discharged from its duties as escrow
agent hereunder by its giving the other parties hereto written notice, and
such
resignation shall become effective at such time that the Escrow Agent shall
turn
over to a successor escrow agent appointed by the Company the Escrow Securities
held hereunder. If no successor escrow agent is so appointed within the sixty
(60) day period following the giving of such notice of resignation, the Escrow
Agent may submit an application to deposit the Escrow Securities with the United
States District Court for the Southern District of New York, provided
the
Escrow Agent provides notice of such deposit to the Company and the Private
Investors in accordance with Section 6.7 hereof.
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 other parties hereto,
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 willful
misconduct.
5.8. Waiver.
The Escrow Agent hereby waives any and all right, title, interest or claim
of
any kind (each, a “Claim”)
in or to any distribution of the Trust Account (as defined in that certain
Investment Management Trust Agreement, dated as of the date hereof, by and
between the Company and the Escrow Agent as trustee thereunder), and hereby
agrees not to seek recourse, reimbursement, payment or satisfaction for any
Claim against the Trust Account for any reason whatsoever.
5.9. Standard
of Care.
The Escrow Agent shall be obligated only to perform the duties specifically
set
forth in this Escrow Agreement, which shall be deemed purely ministerial in
nature, and the Escrow Agent shall under no circumstances be deemed to be a
fiduciary to any party hereto or any other person. The parties hereto agree
that
the Escrow Agent shall not assume any responsibility for the failure of the
parties hereto to perform in accordance with this Escrow Agreement or any other
agreement or document. This Escrow Agreement sets forth all matters pertinent
to
the escrow contemplated hereunder, and no additional obligations of the Escrow
Agent shall be inferred from the terms of this Escrow Agreement or any other
agreement or document. IN
NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR INDIRECTLY, FOR ANY
DAMAGES OR EXPENSES ARISING OUT OF THE SERVICES PROVIDED HEREUNDER, OTHER THAN
DAMAGES WHICH RESULT FROM THE ESCROW AGENT’S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT.
6. Miscellaneous.
6.1. Governing
Law and Consent to Jurisdiction.
This
Agreement shall be governed by, and construed in accordance with, the laws
of
the State of New York applicable to contracts executed in and to be performed
in
that State, including, without limitation, Sections 5-1401 and 5-1402 of the
New
York General Obligations Law and the New York Civil Practice Laws and Rules
327(b). The parties hereto agree that any action, proceeding or claim against
it
arising out of or relating in any way to this Agreement shall be brought and
enforced in the courts of the State of New York or the United States District
Court for the Southern District of New York, and the parties hereto irrevocably
submit to such jurisdiction, which jurisdiction shall be exclusive. The parties
hereto hereby waive any objection to such exclusive jurisdiction and that such
courts represent an inconvenient forum.
4
6.2. Waiver
of Trial by Jury.
Each
party hereto hereby irrevocably and unconditionally waives the right to a trial
by jury in any action, suit, counterclaim or other proceeding (whether based
on
contract, tort or otherwise) arising out of, connected with or relating to
this
Agreement, the transactions contemplated hereby, or the actions of the parties
in the negotiation, administration, performance or enforcement
hereof.
6.3 Third
Party Beneficiaries.
Each of
the Private Investors hereby acknowledges that the Underwriter is third party
beneficiary of this Agreement and this Agreement may not be modified or changed
without the prior written consent of Credit Suisse.
6.4. Entire
Agreement.
This
Agreement and the Insider Letters and Warrants as referenced herein contain
the
entire agreement of the Company and the Private Investors with respect to the
subject matter hereof, and this Agreement contains the entire agreement as
it
pertains to the Escrow Agent and the other parties hereto and, except as
expressly provided herein, may not be changed or modified except by an
instrument in writing signed by all parties to this Agreement and Credit Suisse.
This Agreement may be executed in several original or facsimile counterparts,
each one of which shall constitute an original, and together shall constitute
but one instrument.
6.5. Headings.
The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation hereof.
6.6. Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the respective
parties hereto and their legal representatives, successors and permitted
assigns. Any corporation or association into which the Escrow Agent may be
converted or merged, or with which it may be consolidated, or to which it may
sell or transfer all or substantially all of its corporate trust business and
assets as a whole or substantially as a whole, or any corporation or association
resulting from any such conversion, sale, merger, consolidation or transfer
to
which the Escrow Agent is a party, shall be and become the successor escrow
agent under this Escrow Agreement and shall have and succeed to the rights,
powers, duties, obligations, immunities and privileges of the Escrow Agent,
without the execution or filing of any instrument or paper or the performance
of
any further act.
6.7. Notices.
Any
notice or other communication required or which may be given hereunder shall
be
in writing and shall be sent by certified or registered mail, by private
national courier service (return receipt requested, postage prepaid), by
personal delivery or by facsimile transmission. Such notice or communication
shall be deemed given (a) if mailed, two days after the date of mailing, (b)
if
sent by national courier service, one business day after being sent, (c) if
delivered personally, when so delivered, or (d) if sent by facsimile
transmission, on the second business day after such facsimile is transmitted,
in
each case as follows:
If
to the Company, to:
Xxxxxxxxxxx
Acquisition Corp.
0000
Xxxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxx 00000
Attn:
Xxxxxx Xxxxxxxx
Fax:
(000)
000-0000
5
If
to a
Private Investor, to his address set forth in Exhibit A.
If
to the Escrow Agent, to:
American
Stock Transfer & Trust Company
00
Xxxxxx
Xxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxx
Xxxxxxxxx
Fax:
(000)
000-0000
A
copy of any notice sent hereunder shall be sent to each of:
Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP
000
Xxxxx Xxxxx Xxxxxx
Xxxxx
0000
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx
X. Xxxx, Esq.
Fax:
(000) 000-0000
Credit
Suisse Securities (USA) LLC
Eleven
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
LCD-IBD
Xxxxxxx
Xxxxxxx & Xxxxxxxx LLP
0000
Xxxxxxx Xxxxxx
Xxxx
Xxxx, Xxxxxxxxxx 00000
Attn:
Xxxxxxx X. Xxxxxx, 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.
6.8. Liquidation
of the 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 specified in the Registration
Statement.
6.9
Disputes.
If any
disagreement or dispute arises among the Company and the Private Investors
concerning the meaning or validity of any provision hereunder or concerning
any
other matter relating to this Escrow Agreement, the Escrow Agent shall be under
no obligation to act, except (i) with joint written instruction of the Company
and the Private Investors, or (ii) under process or order of court, and shall
sustain no liability for its failure to act pending such process or court
order.
6.10
Authorized
Signatures.
Concurrent with the execution of this Agreement, the Company will provide a
completed certificate of parties authorized to sign on its behalf, in the form
attached hereto as Schedule II.
6.11
Termination.
This
Agreement shall terminate on the final distribution or destruction of all of
the
Escrow Securities in accordance with the terms of this Agreement.
6.12 Severability.
Any
term or provision of this Agreement that is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable in any
situation in any jurisdiction shall not affect the validity or enforceability
of
the remaining terms and provisions hereof or the validity or enforceability
of
the offending term or provision in any other situation or in any other
jurisdiction. If the final judgment of a court of competent jurisdiction or
other authority declares that any term or provision hereof is invalid, void
or
unenforceable, the parties agree that the court making such determination shall
have the power to reduce the scope, duration, area or applicability of the
term
or provision, to delete specific words or phrases, or to replace any invalid,
void or unenforceable term or provision with a term or provision that is valid
and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision.
6
IN
WITNESS WHEREOF, the parties have duly executed this Securities Escrow Agreement
as of the date first written above.
| XXXXXXXXXXX ACQUISITION CORP. | ||
| |
|
|
| By: | ||
|
Name: |
||
| Title: | ||
| AMERICAN
STOCK
TRANSFER & TRUST COMPANY, AS ESCROW AGENT |
||
| |
|
|
| By: | ||
|
Name: |
||
| Title: | ||
[Escrow
Agreement]
| PRIVATE INVESTORS: | ||
| GRST ACQUISITION, LLC | ||
| |
|
|
| By: | Xxxxxxxxxxx Capital, L.P., its sole member |
|
| By: Xxxxxxxxxxx Management, Inc., | ||
|
its
general partner
|
||
| By: | ||
|
|
||
| Title: | ||
|
Duke X. Xxxxxxx |
|||
|
Xxxxxx X. Xxxxxxx |
|||
|
Xxxxxx X. XxXxxxx III |
|||
|
Xxxxx Xxxxxxx |
|||
|
Xxxx Meadow |
|||
[Escrow
Agreement]
Exhibit
A
|
Name
and Address of Private Investor:
|
Number
of Founder Units
|
Number
of Sponsor Warrants
|
||
|
Xxxxxxxxxxx
Acquisition, LLC
0000
Xxxxx Xxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx
Xxxxx, Xxxxxxx 00000
|
|
9,487,501
|
|
4,610,000
|
|
Duke
X. Xxxxxxx
|
53,906
|
15,000
|
||
|
Xxxxxx
X. Xxxxxxx
|
53,906
|
125,000
|
||
|
Xxxxxx
X. XxXxxxx III
|
53,906
|
125,000
|
||
|
Xxxxx
Xxxxxxx
|
53,906
|
125,000
|
||
|
Xxxx
Meadow
|
1,078,125
|
1,000,000
|
