STOCK ESCROW AGREEMENT
EXHIBIT
10.3
STOCK
ESCROW AGREEMENT, dated as of ____________, 2006 (the "Agreement"), by and
among
CROSSFIRE CAPITAL CORPORATION, a Delaware corporation (the "Company"), The
Xxxxxx Xxxxxx 2000 Family Trust, Xxxxx X. Xxxxxxxxx, Ian X.X. Xxxxxxx,
Xxxxx X. Xxxxxx and Xxxxxxx X. Xxxxxxx (collectively, the "Initial
Stockholders") and AMERICAN 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 Xxxxxx, Xxxxx Xxxxx, Incorporated ("FBW") acting
as the sole underwriter (the "Underwriter"), pursuant to which, among other
matters, the Underwriter has agreed to purchase 10,000,000 units (the "Units")
of the Company. Each Unit consists of one share of the Company's Common Stock,
par value $.0001 per share, and two Warrants, 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. -________) 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;
and
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.
NOW,
THEREFORE, in
consideration of the mutual covenants hereinafter set forth, the parties agree
as follows:
1. APPOINTMENT
OF THE 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. Capitalized terms used in this
Agreement but not defined herein will have the meanings set forth in the
Registration Statement.
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.
3. DISBURSEMENT
OF THE ESCROW SHARES.
3.1 The
Escrow Agent shall hold the Escrow Shares until the one hundred eightieth day
following the consummation by the Company of a Business Combination (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 3.3 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; provided further,
however, that if, after the Company consummates a Business Combination (as
such
term is defined in the Prospectus), 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 Financial 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.
3.2 CONSUMMATION
OF A BUSINESS COMBINATION. Within thirty (30) days after the consummation by
the
Company of a Business Combination, the Company shall deliver to the Escrow
Agent
a certificate executed by the Chief Executive Officer or the Chief Financial
Officer, in form reasonably acceptable to the Escrow Agent, stating that a
Business Combination has been consummated, the date of the Business Combination
shall have been consummated and the date that is one hundred eighty days after
the date of consummation of a Business Combination.
3.3
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(s)
specified in the Prospectus.
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 ("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
4.4 INSIDER
LETTERS. Each of the Initial Stockholders has executed a letter agreement with
FBW and the Company, dated as indicated on Exhibit
A
hereto,
and which is 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 hereunder. The Escrow Agent shall also be
entitled to reimbursement from the Company for all 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.
3
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
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 as hereinafter provided. 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 Shares
held hereunder. If no new escrow agent is so appointed within the 60-day period
following the giving of such notice of resignation, the Escrow Agent may deposit
the Escrow Shares with any court it reasonably deems appropriate.
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 its own
willful misconduct.
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.
6.2 THIRD
PARTY BENEFICIARIES. Each of the Initial Stockholders hereby acknowledges 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
FBW.
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 the charged.
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.
4
6.6 NOTICES.
Any notice or other communication required or which may be given hereunder
shall
be in writing and either be delivered personally or be mailed, certified or
registered mail, or by private national courier service, return receipt
requested, postage prepaid, and shall be deemed given when so delivered
personally or, if mailed, two days after the date of mailing, as
follows:
If
to the Company, to:
Crossfire
Capital Corporation
000
Xxxxx
Xxxxxx, Xxxxx 0000
Xxx
Xxxx,
XX 00000
Attn:
Xxxxxx Xxxxxx
If
to a
Stockholder, to his address set forth in Exhibit
A.
and
if to the Escrow Agent, to:
American
Stock Transfer & Trust Company
00
Xxxxxx
Xxxx, Xxxxx Xxxxx
Xxx
Xxxx,
XX 00000
[Attn:
_________________]
A
copy of
any notice sent hereunder shall be sent to:
Davies
Xxxx Xxxxxxxx & Xxxxxxxx LLP
000
Xxxxxxx Xxxxxx, 00 Xxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxx
X. Xxxxxx, Esq.
Xxxxxx,
Xxxxx Xxxxx, Inc.
0000
Xxxxxxxxxxx Xxxx, Xxxxx 000
XxXxxx,
XX 00000
Attn:
Xxxxx
XxXxxxx
and:
Xxxxxxx
Savage LLP
000
Xxxx
00xx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxx
X. Xxxxxxxxx, Esq.
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
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective
as of the date first aforesaid.
| CROSSFIRE CAPITAL CORPORATION | ||
| |
|
|
| By: | ||
|
Name:
Xxxxxx Xxxxxx
Title:
President
|
||
| INITIAL STOCKHOLDERS: | ||
| The Xxxxxx Xxxxxx 2000 Family Trust | ||
| |
|
|
| By: | ||
|
Trustee |
||
| Xxxxx X. Xxxxxxxxx | ||
| Xxx X.X. Xxxxxxx | ||
| Xxxxx X. Xxxxxx | ||
| Xxxxxxx X. Xxxxxxx | ||
| AMERICAN STOCK TRANSFER & TRUST COMPANY | ||
| |
|
|
| By: | ||
|
Name:
Title:
|
||
6
EXHIBIT
A
|
Name
and Address of Initial Stockholder
|
Number
of
Shares
|
Stock
Certificate
Number
|
Date
of
Insider
Letter
|
|||||||
|
The
Xxxxxx Xxxxxx 2000 Family Trust
|
2,250,000
|
__,
0000
|
||||||||
|
Xxxxx
X. Xxxxxxxxx
|
62,500
|
__,
2006
|
||||||||
|
Ian
X. X. Xxxxxxx
|
62,500
|
__,
2006
|
||||||||
|
Xxxxx
X. Xxxxxx
|
62,500
|
__,
2006
|
||||||||
|
Xxxxxxx
X. Xxxxxxx
|
62,500
|
__,
2006
|
||||||||
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