Exhibit 10.7
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement") dated September 18,
1998 by and among BENTLEY SYSTEMS, INCORPORATED (the "Company"), BACHOW
INVESTMENT PARTNERS III, L.P. or any other entity as to which any affiliate of
Bachow & Associates, Inc. is the general partner and who purchased Preferred
Stock under the Stock Purchase Agreement (the "Purchaser") and WILMINGTON TRUST
COMPANY, as escrow agent (the "Escrow Agent").
RECITALS
(a) Pursuant to a Stock Purchase Agreement dated as of
September 18, 1998 (the "Stock Purchase Agreement") among, inter alia, the
Company and the Purchaser, the Purchaser purchased from the Company for an
aggregate purchase price of $15,000,000: 1,552,450 shares of Series A
Convertible Preferred Stock, par value $.01 per share (the "Preferred Stock");
and subject to the terms of this Agreement, 2,171,028 shares of Class B
Non-Voting Common Stock, par value $.01 per share (the "Common Stock").
(b) Pursuant to the Stock Purchase Agreement, a stock
certificate (the "Certificate") in the name of the Purchaser, evidencing the
Common Stock is contemporaneously herewith being placed into escrow (the
"Escrow") by the Company for distribution pursuant to this Agreement.
(c) The Escrow Agent has agreed to act as escrow agent on the
terms and conditions specified herein.
NOW THEREFORE, intending to be legally bound hereby, the
parties hereto agree as follows:
1. Appointment of Escrow Agent; Acceptance of Appointment. The
Company and the Purchaser hereby appoint the Escrow Agent as escrow agent
hereunder and the Escrow Agent hereby accepts such appointment.
2. Delivery of the Certificate into the Escrow; Voting and
Dividend Rights. In accordance with Section 1.2(b) of the Stock Purchase
Agreement, the Company has delivered the Certificate and the Purchaser has
delivered executed copies of stock powers, endorsed in blank to transfer the
Certificate, to the Escrow Agent to be held in the Escrow. Until released from
the Escrow, Purchaser shall have all voting and dividend rights (which the
Company and the Purchaser shall transmit to the Escrow Agent) relating to the
Common Stock. Additionally, until the shares of Common Stock are released from
the Escrow, all cash dividends, interest and premiums declared and paid on the
Common Stock, as well as any additional shares which are issued with respect to
the Common Stock as a result of any stock dividend, as payment in lieu of any
interest on dividends, by reclassification or otherwise (the "Additional Escrow
Amount") shall be held by the Escrow Agent until the shares of Common Stock to
which they relate are released from the Escrow in accordance with the terms of
this Agreement, in which case the Additional Escrow Amount shall be released
together with such shares. The Escrow Agent shall invest cash pursuant to the
written instructions of the Company, and in the absence of such instructions, in
the U.S. Government portfolio of the Xxxxxx Square Fund, a mutual fund managed
by Xxxxxx Square Management Corporation, a subsidiary of the Escrow Agent.
3. Compensation of the Agent. The Escrow Agent shall be
compensated for its services as provided in Section 5(d). The Escrow Agent shall
be entitled to reimbursement of its reasonable out-of-pocket expenses including,
without limitation, the fees and costs of attorneys or agents whom it may find
necessary to engage in the performance of its duties hereunder. The Company
shall be liable to the Escrow Agent for such compensation and reimbursement.
4. Release of the Escrow.
a. Shares of Common Stock shall be released from the
Escrow in such number, to such persons or entities and at such times as are
specified in the written instructions that the Company or the Purchaser shall
provide from time to time to the Escrow Agent (the "Escrow Instructions"). The
Company or the Purchaser shall provide the Escrow Instructions in accordance
with and as provided in Exhibit A hereto and such Escrow Instructions from the
Purchaser or, if applicable, from the Company shall contain a certification that
the conditions set forth in Section 4(d) hereof have been met. Examples of the
calculations specified in Exhibit A are set forth in Exhibit B hereto. Upon
receipt of the Escrow Instructions the Escrow Agent shall transmit a copy of the
Escrow Instructions to the other party. When shares are to be released, the
Escrow Agent shall transmit the Certificate (or any replacement stock
certificate) to the Company (or, if applicable, its transfer agent) with a copy
of the applicable Escrow Instructions. Subject to Sections 4(b) and 4(c), the
Company (or, if applicable, its transfer agent) shall issue stock certificates
in accordance with such Escrow Instructions and deliver the stock certificates
to the applicable persons and/or entities and deliver a certificate for any
balance to the Escrow Agent, in the name of the Purchaser.
b. If either the Company or the Purchaser gives
written notice to the other and the Escrow Agent disputing any Escrow
Instructions (a "Counter Notice") within 20 days following the date the Escrow
Instructions are delivered to the other party, such dispute shall be resolved as
provided in Section 4(c). If no Counter Notice is received by the Escrow Agent
within such 20-day period, then the Escrow Instructions shall be deemed mutually
agreed to for purposes of this Agreement at the end of such 20-day period. The
Escrow Agent shall not inquire into or consider whether the Escrow Instructions
comply with the requirements of the Stock Purchase Agreement or the calculations
set forth in Exhibit B hereto.
c. If a Counter Notice is received, the Escrow Agent
shall release the shares requested in the Escrow Instructions only in accordance
with (i) joint written instructions of the Company and the Purchaser or (ii) a
final non-appealable order of a court of competent jurisdiction. Any court order
shall be accompanied by a legal opinion by counsel for the presenting party
satisfactory to the Escrow Agent to the effect that the order is final and
non-appealable. The Escrow Agent shall act in accordance with such court order
and legal opinion without further question.
d. Notwithstanding the above, the Escrow Agent shall
not release to the Purchaser any of the Common Stock from the Escrow pursuant to
this Section 4 unless and until the Purchaser either (i) exercises its right to
have the Preferred Stock redeemed by the Company (the "Redemption Right") as
provided in the Amended Certificate (as defined in the Stock Purchase Agreement)
or (ii) waives the Redemption Right through the conversion of the Preferred
Stock pursuant to Section 4(a) of the Amended Certificate; provided, however,
that, if the Purchaser exercises its Redemption Right and the payment is made
pursuant to Section 3 of the Amended Certificate, the Purchaser shall not be
entitled to any of the Common Stock released from the Escrow and such Common
Stock shall be distributed to the Pre-Closing Shareholders (as defined below) in
accordance with Section 4(e). As applicable, the Company or the Purchaser shall
provide Escrow Instructions in accordance with the foregoing promptly upon the
exercise or waiver of the Redemption Right.
e. For purposes of this Agreement and the Escrow
Instructions, "Pre-Closing Shareholders" shall mean any shareholders owning
stock in the Company both immediately prior to the date hereof and as certified
to the Escrow Agent by the Company as of the close of business on the date the
Escrow Instructions are provided to the Escrow Agent. Any time a distribution is
earned back or required to be made to the Pre-Closing Shareholders pursuant to
this Agreement and Exhibit A hereto, it shall be made to the Pre-Closing
Shareholders that still own shares of the Company's Common Stock on the date the
Escrow Instructions are provided to the Escrow Agent in proportion to the number
of shares of the Company's Common Stock owned by each Pre-Closing Shareholder as
of the close of business on the date the Escrow Instructions are provided to the
Escrow Agent up to but not exceeding the number of shares owned by each such
Pre-Closing Shareholder immediately prior to the date hereof.
5. Matters Relating to the Escrow Agent.
a. The Escrow Agent undertakes to perform only such
duties expressly set forth herein and no implied duties or obligations shall be
read into this Agreement against the Escrow Agent. In acting hereunder, the
Escrow Agent shall not be liable for any act done or omitted to be done, by it
in the absence of gross negligence or willful misconduct.
b. The Escrow Agent may only act on and rely upon the
Escrow Instructions to which no objection has been received pursuant to Section
4, or such other joint written instructions received from the Company and the
Purchaser pursuant to Section 4(c); provided, however, that the Escrow Agent may
also rely upon a final non-appealable court order as provided in Section 4(c).
The Escrow Agent may act in reliance upon any such writings or instruments or
any signatures thereon which it, in good faith, believes to be genuine, and may
assume the validity and accuracy of any statement or assertion contained in such
writings or instruments and may assume that any person purporting to give any
writing, notice, advice or instruction in connection with the provisions hereof
has been duly authorized to do so.
c. The Escrow Agent shall be entitled to consult with
legal counsel in the event that a question or dispute arises with regard to the
construction of any of the provisions hereof, and shall incur no liability and
shall be fully protected in acting in accordance with the advice or opinion of
such counsel.
d. The Company shall pay to the Escrow Agent an
initial fee of $1500 and $2000 per year thereafter for its services hereunder.
In the event the Escrow Agent renders any extraordinary services in
connection with the Escrow at the request of the parties, the Escrow Agent shall
be entitled to additional compensation therefor. The Escrow Agent shall have a
first lien against the Escrow to secure the obligations of the Company
hereunder. The terms of this paragraph shall survive termination of this
Agreement.
e. The Company and the Purchaser, jointly and
severally, shall indemnify the Escrow Agent and hold it harmless from any and
against all liabilities, losses, actions, suits or proceedings at law or in
equity, and any other expenses, fees or charges of any character or nature,
including without limitation, reasonable attorneys' fees, which the Escrow Agent
may incur or with which it may be threatened by reason of its acting as escrow
agent under this Agreement or arising out of the existence of the Escrow, except
to the extent the same shall be caused by the Escrow Agent's gross negligence or
willful misconduct. In so agreeing to indemnify, hold harmless and reimburse the
Escrow Agent, the parties intend thereby to cover all losses, claims, damages,
liabilities and expenses, including reasonable costs of investigation, and
counsel fees and disbursements, which may be imposed upon the Escrow Agent or
incurred in connection with its acceptance of appointment as escrow agent
hereunder or the performing of its duties hereunder, including any litigation
arising from this Agreement. The Escrow Agent shall have a first lien against
the Escrow to secure the obligations of the Company hereunder. As between the
Company and the Purchaser, the prevailing party shall be entitled to recover any
amounts paid with respect to the indemnification of the Escrow Agent. The terms
of this paragraph shall survive termination of this Agreement.
f. In the event the Escrow Agent receives conflicting
instructions hereunder, the Escrow Agent shall be fully protected in refraining
from acting until such conflict is resolved to the satisfaction of the Escrow
Agent. The Escrow Agent shall be entitled to refrain from taking any action
contemplated by this Agreement in the event that it becomes aware of any
disagreement between the parties hereto as to any material facts or as to the
happening of any contemplated event precedent to such action, but the Escrow
Agent shall not be deemed to have knowledge thereof unless and until it has
received notice thereof from any party hereto. The Escrow Agent shall have the
right at any time it deems appropriate to seek an adjudication in a court of
competent jurisdiction as to the respective rights of the parties hereto and
shall not be held liable by any party hereto for any delay or the consequences
of any delay occasioned by such resort to the court. In addition, the Escrow
Agent shall have the right to institute a xxxx of interpleader in any court of
competent jurisdiction to determine the rights of the parties, and the parties
shall pay all costs, expenses and disbursements in connection therewith,
including attorneys' fees.
g. The Escrow Agent may resign as such following the
giving of thirty (30) days' prior written notice to the other parties hereto.
Similarly, the Escrow Agent may be removed and replaced following the giving of
thirty (30) days' prior written notice to the Escrow Agent by the Company and
the Purchaser. In either event, the duties of the Escrow Agent shall terminate
thirty (30) days after the date of such notice (or as of such earlier date as
may be mutually agreeable), and the Escrow Agent shall then deliver the balance
of the Escrow then in its possession to a successor escrow agent as shall be
appointed by the Company and the Purchaser as evidenced by a written notice
filed with the Escrow Agent.
If the Company and the Purchaser are unable to agree upon a
successor or shall have failed to appoint a successor prior to the expiration of
thirty (30) days following the date of the notice of resignation or removal, the
Escrow Agent may petition any court of competent jurisdiction for the
appropriate relief. Any such resulting appointment shall be binding upon all of
the parties hereto.
Upon acknowledgment by any successor escrow agent of the
receipt of the then remaining balance of the Escrow, the Escrow Agent shall be
fully released and relieved of all duties, responsibilities, and obligations
under this Agreement.
6. Notices. Any notice, request, demand, or other
communication permitted or required to be given pursuant to this Agreement shall
be in writing and shall be deemed to have been properly given if delivered in
person one day after being sent via reputable national overnight courier to the
following address:
-2-
If to the Company:
Bentley Systems, Incorporated
000 Xxxxxxxx Xxxxx
Xxxxx, XX 00000-0000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attention: General Counsel
with a copy to:
Drinker Xxxxxx & Xxxxx LLP
0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Xx., Esquire
Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
If to the Purchaser:
Bachow Investment Partners III, L.P.
Bala Equity Partners, L.P., general partner
Bala Equity, Inc., general partner
0 Xxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxx, XX 00000
Attention: Xxx X. Xxxx, Managing Director
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
with a copy to:
Wolf, Block, Xxxxxx and Xxxxx-Xxxxx LLP
000 Xxxxx 00xx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, Esquire
Telephone No: (000) 000-0000
Telecopy No: (000) 000-0000
-3-
If to the Escrow Agent:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Custody
Telecopy No.: (000)000-0000
Any party included above may designate a different address by giving written
notice to the other parties to this Agreement in the manner provided in this
Section.
7. Governing Law; Transferability. This Agreement shall be
construed in accordance with, and governed by, the laws of the State of
Delaware, without giving effect to any choice of law principles that might
otherwise be applicable. For purposes of this Agreement, the parties hereto
agree to submit to the jurisdiction of the courts of the State of Delaware. This
Agreement shall inure to the benefit of and be binding upon the respective legal
representatives, and permitted successors and assigns of the parties hereto;
provided that no assignment may be made without the written consent of the other
parties.
8. Construction. This Agreement shall be construed without
regard to incidents of authorship or negotiation.
9. Amendments. This Agreement may not be amended or
supplemented and no provision hereof may be modified or waived except by an
instrument in writing signed by all parties hereto.
10. Entire Agreement. As between the Company and the
Purchaser, the Stock Purchase Agreement, the Exhibits and Schedules thereto, and
as between all parties, this Agreement contains the entire understanding of the
parties with respect to the subject matter of this Agreement. There are no
promises, representations, or other undertakings among the parties to this
Agreement with respect to its subject matter other than those expressly set
forth in the Stock Purchase Agreement and this Agreement.
11. Counterparts. This Agreement may be executed in multiple
counterparts and by the different parties on separate counterparts. Any
presentation of proof of this Agreement shall be sufficient if the counterpart
executed by the party against whom such proof is offered shall be presented as
evidence.
-4-
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first above written.
COMPANY:
BENTLEY SYSTEMS, INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
------------------------------------------
Title: President
-----------------------------------------
Address: 000 Xxxxxxxxxxxx Xxxxx
Xxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
PURCHASER:
BACHOW INVESTMENT PARTNERS III, L.P.
By: Bala Equity Partners, LP., general partner
By: Bala Equity, Inc., general partner
By: /s/ Xxx X. Xxxx
-------------------------------------------
Name: Xxx X. Xxxx
------------------------------------------
Title: Vice President
-----------------------------------------
Address: 0 Xxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxx, XX 00000
Attention: Xxx X. Xxxx, Managing Director
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ESCROW AGENT:
WILMINGTON TRUST COMPANY
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------------
Name: Xxxxx X. Xxxxxxxx
------------------------------------------
Title: Vice President
-----------------------------------------
-5-
EXHIBIT A: RULES GOVERNING DISTRIBUTION OF SHARES HELD IN ESCROW
The Class B Common Stock in escrows A1, A2, B1 and B2 will be divided between
the Investor and the Pre-Closing Shareholders and distributed at the time and
based on the methodology described below:
1) COMPANY IS NEITHER SOLD NOR OUT OF AN IPO LOCKUP BEFORE FOUR YEAR
ANNIVERSARY OF CLOSING
a) Xxxxxx X0, X0, X0 and B2 distributed to Investor upon
conversion of Preferred or waiver of Redemption Right as
provided in the Escrow Agreement. Upon redemption of
Preferred, the escrow is distributed to Pre-Closing
Shareholders.
2) COMPANY IS OUT OF IPO LOCKUP BEFORE FOUR YEAR ANNIVERSARY OF CLOSING
a) During any full quarter that is (i) after the end of the
underwriter-imposed lockup period and (ii) before or ending at
the end of year 4, the Pre-Closing Shareholders can earn back
Escrow A1 and/or Escrow B1 by having the "Deemed Market Cap"
for the Company exceed the relevant thresholds shown in
columns 1 and 3 on the attached Exhibit C (the Deemed Market
Cap is computed by averaging the closing price per share of
the Company for all trading days during the quarter (but
eliminating the 5 highest and 5 lowest closing prices before
averaging), and multiplying such averaged price per share by
28,546,662 shares, plus the number of shares issued in the
Company's public offering(s)). Shares earned back shall be
released from Escrow and distributed to the Pre-Closing
Shareholders immediately following the quarter when earned.
b) During any full quarter that is (i) after the end of the
underwriter-imposed lockup period and (ii) before or ending at
the end of year 4, the Pre-Closing Shareholders can earn back
Escrow A2 and/or Escrow B2 by having the Deemed Market Cap for
the Company exceed the relevant thresholds shown in columns 2
and 4 on the attached Exhibit C. Shares earned back shall be
released from Escrow and distributed to the Pre-Closing
Shareholders immediately following the quarter when earned.
c) At the end of year 4, the remaining "Escrow Shares", if any,
will be distributed as follows:
i) Define "Escrow Shares" as the total number of
shares, if any, remaining in Xxxxxxx X0, X0, X0 and
B2 four years after Closing.
ii) Define "#EscrowsLeft" based on the following
formula:
EscrowShares
# EscrowsLeft = ------------
1,085,514
iii) Define "MktCap" as the average closing market
capitalization of the company during the 60 trading
days leading up to the end of year 4, but eliminating
the 5 highest and 5 lowest market caps before
averaging.
iv) Define "TFS" as the fully diluted company shares
outstanding at end of Year 4.
v) Number of shares from escrow distributed to Investor
is:
DeemedMktCap - $500m 1,552,450
$60m + ($3.75m X (#EscrowsLeft) X Min( Max( --------------------,0),1))-(--------- X MktCap)
$800m TFS
Max[Min[-------------------------------------------------------------------------------------------- ,1],0] X EscrowShares
EscrowShares
------------ X MktCap
TFS
vi) Escrowed shares not released to the Investor are
released pro-rata among remaining pre-Closing
shareholders in the proportion that they still own
pre-closing shares.
3) COMPANY IS SOLD WITHIN FOUR YEARS.
a) At the time of sale, the company's original shareholders can
earn back Escrows A1, A2, B1 and/or B2 by having (the sale
price multiplied by 28,546,662 plus shares issued in the
Company's public offering(s), if any, and divided by the total
fully-diluted shares outstanding on the date of sale (the
"Deemed Sales Price")) exceed the relevant thresholds shown in
columns 5 and 6 on the attached Exhibit C.
b) Define "Escrow Shares" as the total number of shares remaining
in Xxxxxxx X0, X0, X0, and B2 on the date of sale (after the
effect of 3(a), above).
c) Define "#EscrowsLeft" based on the following formula:
EscrowShares
#EscrowsLeft = -----------------
1,085,514
d) Define "MktCap" as the sale price of the Company.
e) Define "TFS" as the total fully diluted company shares
outstanding on the date of sale.
f) Define "CappedReturn" as follows depending when a sale
transaction closes:
-------------------------------------------------------------------------------------------------------
IF A SALE CLOSES ...
--------------------------------------------------------------- THE "CAPPED RETURN" IS EQUAL TO:
ON OR AFTER ... AND BEFORE ...
-------------------------------------------------------------------------------------------------------
DaysSinceC1osing
Closing 1 year anniversary of Closing 2.00+ ( ---------------- X 0.50)
365
-------------------------------------------------------------------------------------------------------
DaysSince1YearAnniv
1 year anniversary of Closing 2 year anniversary of Closing 2.50+ ( ------------------- X 0.25)
365
-------------------------------------------------------------------------------------------------------
DaysSince2YearAnniv
2 year anniversary of Closing 3 year anniversary of Closing 2.75+ ( ------------------- X 0.25)
365
-------------------------------------------------------------------------------------------------------
3 year anniversary of Closing Anytime Later No Capped Return
g) Number of shares from escrow distributed to Investor is:
Deemed
Sales
Price-$500m 1,552,450
Min($60m+($3.75mX(#EscrowsLeft)XMin(Max(-----------,0),1)),$15mXCappedReturn)-(---------XMktCap)
$800m TFS
Max[ Min[ ----------------------------------------------------------------------------------------------- ,0] ,0] X EscrowShares
EscrowShares
------------XMktCap
TFS
h) Escrowed shares not released to the Investor are released
pro-rata among remaining pre-Closing shareholders in the
proportion that they still own pre-Closing shares.
4) OTHER DEFINITIONS USED IN THIS EXHIBIT
a) Min(a,b,...) is defined as a function which returns the
minimum value of any of its supplied parameters. For example,
Min(1,5,-3) is -3, and Min(2,16,4) is 2.
b) Max(a,b,...) is defined as a function which returns the
maximum value of any of its supplied parameters. For example,
Max(1,5,-3) is 5, and Max(2,l6,4) is 16.
c) Xxxxxxx X0, X0, X0, and B2 each contain 542,757 shares of
Class B Common Stock at Closing.
EXHIBIT B: EXAMPLE OF CALCULATION
Example Scenario Assumptions
- Company has completed an IPO and is out of an IPO lock-up before the
four-year anniversary of closing.
- Company has reached a "Deemed Market Cap" of $700 million in the sixteenth
quarter which Deemed Market Cap is higher than any prior quarter, such that
none of the threshold levels for escrow release in Exhibit C were previously
achieved.
- Market Cap = $750,000,000
- TFS = Total Fully-Diluted Shares = 28,546,662
Results
- Shares held in escrows A1 & A2 (1,085,514 shares total) are earned back by
the Pre-Closing Shareholders (and therefore immediately released from Escrow
to the Pre-Closing Shareholders), but not escrows B1 & B2.
- Escrow Shares = 1,085,514
- Escrows Left = 1
- Therefore, escrow shares distributed to the Investor at the end of year four:
( ( ( ( (DeemedMktCap - $500m ) )) (1,552,450 ) ) )
( ($60m + ($3.75m x (# EscrowsLeft) x Min (Max(--------------------,0),1))-(---------x MktCap) ) )
( ( ( ( ( $800m ) )) ( TFS ) ) )
Max (Min(-------------------------------------------------------------------------------------------,1),0) x EscrowShares
( ( EscrowShares ) )
( ( ------------x MktCap ) )
( ( TFS ) )
( ( ( ( ($700m - $500m ) )) ( 1,552,450 ) ) )
( ($60m + ($3.75m x 1 x Min (Max(-------------,0),1))-(----------x $750m) ) )
( ( ( ( ( $800m ) )) (28,546,662 ) ) )
Max (Min(----------------------------------------------------------------------------,1),0) x 1,085,514
( ( 1,085,514 ) )
( ( ------------x $750m ) )
( ( 28,546,662 ) )
( ($60m + ($3.75m x Min(Max(0.25,0),1)) - (0.054383 x $750m) ) )
Max(Min(---------------------------------------------------------,1),0) x 1,085,514
( ( 0.038026 x $750m ) )
( ($60m + ($3.75m x 0.25) - ($40,787,168) ) )
Max(Min(--------------------------------------,1),0) x 1,085,514
( ( $28,519,464 ) )
( ($20,150,332 ) )
Max(Min(-----------,1),0) x 1,085,514
( ($28,519,464 ) )
0.706547 x 1,085,514 = 766,966
and the remaining 318,548 escrow shares are distributed to the Pre-Closing
Shareholders.
EXHIBIT C: Thresholds For Release of Escrows to Pre-Closing Shareholders
1 2 3 4 5 6
---------------------------------------------------------------------------
While the company is publicly-traded, At the time of a sale, sale price
market cap must exceed ... must exceed ...
---------------------------------------------------------------------------
Quarter After Escrow Escrow Escrow Escrow Escrows A1 & A2 Escrows B1 & B2
Closing A1 A2 B1 B2
-----------------------------------------------------------------------------------------------
1 $495 $593 $702 $842 $344 $488
2 $495 $593 $702 $842 $360 $511
3 $495 $593 $702 $842 $377 $535
4 $495 $593 $702 $842 $394 $560
5 $495 $593 $702 $842 $412 $586
6 $495 $593 $702 $842 $432 $613
7 $495 $593 $702 $842 $452 $641
8 $495 $593 $702 $842 $473 $671
9 $495 $593 $702 $842 $495 $702
10 $518 $593 $735 $842 $518 $735
11 $542 $593 $769 $842 $542 $769
12 $567 $593 $805 $842 $567 $805
13 $593 $593 $842 $842 $593 $842
14 $621 $621 $882 $882 $621 $882
15 $650 $650 $923 $923 $650 $923
16 $680 $680 $965 $965 $680 $965
Note: All dollar amounts shown in millions.
