EXHIBIT 10.1
ESCROW AGREEMENT
(FUNDS)
This ESCROW AGREEMENT is made as of this __th day of March, 1997 by
and between 1997 Corp. with a place of business at 000 Xxxx 000xx Xxxxxx,
Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), and Continental Stock
Transfer & Trust Company with a principal place of business at 0 Xxxxxxxx, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, in its capacity as escrow agent only (the
"Escrow Agent").
W I T N E S S E T H:
WHEREAS, the Company intends to consummate the initial public offering
(the "Offering") of up to an aggregate of 30,000 shares of the Company's common
stock, par value $.001 per share (the "Common Stock") as more fully described
in the Company's Registration Statement on Form SB-2 under the Securities Act
of 1933, as amended (File No. ________), as declared effective by the
Securities and Exchange Commission on _______, 1997 (the "Registration
Statement");
WHEREAS, in accordance with the terms of the offering as set forth in
the Registration Statement, the gross proceeds from the sale of the Shares are
required to be placed directly in an escrow account; and
WHEREAS, the Company wishes to appoint the Escrow Agent as the escrow
agent for such account, on the terms and conditions set forth below in order to
comply with the requirements of Rule 419 of Regulation C of the Rules and
Regulations established by the Securities and Exchange Commission;
NOW, THEREFORE, in consideration of the mutual promises and
obligations set forth below, and for other valuable consideration the
sufficiency and receipt of which are hereby acknowledged, the parties hereto
hereby agree as follows:
I. Appointment of Escrow Agent and Creation of Account. The Company hereby
appoints the Escrow Agent as escrow agent hereunder and directs it to hold
those assets described in Exhibit A attached hereto, together with any
additional assets
which may be deposited with the Escrow Agent from time to time to be held
pursuant to this Agreement and all income earned from investment of the assets
described in Exhibit A and any additions thereto (collectively, the "Escrow
Assets") , in a separate account in the name of "1997 Corp. - Escrow Account"
(the "Escrow Account"). The Escrow Account shall be invested, administered and
distributed in accordance with the terms set forth below. Contemporaneously
with the closing of the Offering, the Company shall deposit with the Escrow
Agent those assets listed on Exhibit A.
1. Initial Funding of Escrow Account. The Escrow Account shall be
initially funded with the proceeds from the sale of Shares by the Company. All
funds from the initial sale of Shares by the Company shall be deposited
directly in the Escrow Account by wire transfer, check or money order.
2. Investment of Escrow Assets. The Escrow Assets shall be invested in
accordance with the instructions set forth in Exhibit C attached hereto. Such
instructions may be modified only by a written certificate executed by an
authorized officer of the Company and delivered to the Escrow Agent; however,
this Escrow Agreement may not be altered by the Board of Directors of the
Company in terms of the investment instructions, except as may be required by
the Board of Directors to fulfill their fiduciary obligations. Escrow Agent
shall make monthly accounting of such investments, the income received
therefrom, and the then existing balance of the Escrow Account to the Company.
3. Distribution from Escrow Account. The Escrow Agent shall make
distributions from the Escrow Account in accordance with the requirements set
forth in Exhibit D attached hereto. Such instructions may be modified only by a
written certificate executed by authorized officers of the Company, and
delivered to the Escrow Agent. In addition, this Escrow Agreement may not be
altered by the Board of Directors of the Company in terms of its distribution
instructions, except as may be required by the Board of Directors to fulfill
their fiduciary obligations. The Escrow Agent is authorized to make
distributions in reliance on the instructions it receives. Written notice of
each disbursement from the Escrow Agent shall be provided to the Company within
ten (10) days of each such disbursement. Upon the final distribution of all of
the Escrow Assets, this Agreement shall terminate and the Escrow Agent shall
have no further obligations or liabilities hereunder.
4. Compensation of Escrow Agent. The Escrow Agent shall receive fees
determined in accordance with, and payable as specified in, the Schedule of
Fees attached hereto as Exhibit E (the "Fee Schedule"). The Escrow Agent shall
have no duties or
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liabilities under this Agreement unless and until full payment of the fee set
forth in Exhibit E. The Escrow Agent shall be reimbursed by the Company for all
expenses, disbursements and advances incurred or made by the Escrow Agent in
preparation, administration and enforcement of this Agreement, including, but
not limited to, reasonable legal fees and expenses. The Company shall be liable
for all payments due to the Escrow Agent under this Agreement.
5. Responsibilities and Rights of the Escrow Agent. To induce the
Escrow Agent to act hereunder, it is further agreed by the undersigned that:
(a) The Escrow Agent undertakes to perform only such duties as are
expressly set forth herein. Without limiting the generality of the foregoing,
the Escrow Agent shall have no duty or responsibility as regards any: (i)
security as to which a default in the payment of principal or interest has
occurred, to give notice of default, make demand for payment or take any other
action with respect to such default; and (ii) loss occasioned by delay in the
actual receipt of notice of any payment, redemption or other transaction
regarding any item in the Escrow Assets as to which it is authorized to take
action hereunder. The Escrow Agent may consult with counsel and shall be fully
protected with respect to any action taken in good faith in accordance with
such advice. The Escrow Agent shall have no liability or responsibility for any
misstatement in, or omission from, the Prospectus.
(b) The Escrow Agent shall not be under any duty to give the
Escrowed Assets held by it hereunder any greater degree of care than it gives
its own similar property and shall not be required to invest any funds held
hereunder except as directed pursuant to this Escrow Agreement. In the event
that there is a change in the investment instructions resulting in uninvested
funds, such uninvested funds held hereunder shall not earn or accrue interest.
(c) The Escrow Agent does not make any representation or warranty
with regard to the creation or perfection, hereunder or otherwise, of a
security interest in the Escrow Assets or regarding the negotiability or
transferability of, or existence of other interests in the Escrow Assets. The
Escrow Agent shall have no responsibility at any time to ascertain whether or
not any security interest exists in the Escrow Assets or any part thereof or to
file any financing statement under the Uniform Commercial Code of any state
with respect to the Escrow Assets or any part thereof.
(d) The Escrow Agent is hereby authorized to comply with any
judicial order or legal process which stays,
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enjoins, directs or otherwise affects the transfer or delivery of the Escrow
Assets or any party hereto and shall incur no liability for any delay or loss
which may occur as a result of such compliance.
(e) The Escrow Agent shall have no duty or responsibility with
regard to any loss resulting from the investment, reinvestment, sale or
liquidation of the Escrow Assets in accordance with the terms of this
Agreement. The Escrow Agent need not maintain any insurance with respect to the
Escrow Assets.
(f) The Escrow Agent shall in no event be liable in connection with
its investment or reinvestment of any cash held by it hereunder in good faith,
in accordance with the terms hereof, including, without limitation, any
liability for any delays (not resulting from its gross negligence or willful
misconduct) in the investment or reinvestment of the Escrowed Assets, or any
loss of interest incident to any such delays.
(g) Except as otherwise expressly provided herein, the Escrow Agent
is authorized to execute instructions and take other actions pursuant to this
Agreement in accordance with its customary processing practices for similar
customers and, in accordance with such practices the Escrow Agent may retain
agents, including its own subsidiaries or affiliates, to perform certain of
such functions. The Escrow Agent shall have no liability under this Agreement
for any loss or expense other than those occasioned by the Escrow Agent's gross
negligence or willful misconduct and in any event its liability shall be
limited to direct damages and shall not include any special or consequential
damages. All collection and receipt of funds or securities and all payment and
delivery of funds or securities under this Agreement shall be made by the
Escrow Agent as agent, at the risk of the other parties hereto with respect to
their actions or omissions and those of any person other than the Escrow Agent.
In no event shall the Escrow Agent be responsible or liable for any loss due to
force beyond its control, including, but not limited to, acts of God, flood,
fire, nuclear fusion, fission or radiation, war (declared or undeclared),
terrorism, insurrection, revolution, riot, strikes or work stoppages for any
reason, embargo, government action, including any laws, ordinances, regulations
or the like which restrict or prohibit the providing of the services
contemplated by this Agreement, inability to obtain equipment or communications
facilities, or the failure of equipment or interruption of communications
facilities, and other causes whether or not of the same class or kind as
specifically named above. In the event that the Escrow Agent is unable
substantially to perform for any of the reasons described in the immediately
preceding sentence,
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it shall so notify the other parties hereto as soon as reasonably practicable
following its actual knowledge of the same.
(h) This Escrow Agreement expressly sets forth all the duties of
the Escrow Agent with respect to any and all matters pertinent hereto. No
implied duties or obligations shall be read into this agreement against the
Escrow Agent. Notwithstanding any provisions of this Agreement to the contrary,
the Escrow Agent shall not be bound by, or have any responsibility with respect
to, any other agreement or contract among the Company and the Representatives
(whether or not the Escrow Agent has knowledge thereof).
(i) It is understood and agreed that should any dispute arise with
respect to the payment and/or ownership or right of possession of the Escrow
Assets, or should the Escrow Agent in good faith be in doubt as to what action
it should take hereunder, the Escrow Agent is authorized and directed to retain
in its possession, without liability to anyone, all or any part of the Escrow
Assets until such dispute shall have been settled either by mutual agreement by
the parties concerned or by the final order, decree or judgment of any court or
other tribunal of competent jurisdiction in the United States of America and
time for appeal has expired and no appeal has been perfected, but the Escrow
Agent shall be under no duty whatsoever to institute or defend any such
proceedings. Any such court order shall be accompanied by a legal opinion by
counsel for the presenting party satisfactory to the Escrow Agent to the effect
that said court order is final and nonappealable.
(j) The Escrow Agent shall be entitled to rely upon any order,
judgment, certification, demand, notice, instrument or other writing delivered
to it hereunder without being required to determine the authenticity or the
correctness of any fact stated therein or the propriety or validity of the
service thereof. Without limiting the foregoing, in the event of any alteration
of investment or distribution instructions, the Escrow Agent shall have no
responsibility to determine whether the requested alteration was required by
the Board of Directors of the Company to fulfill its fiduciary obligations. The
Escrow Agent may act in reliance upon any instrument or signature believed by
it to be genuine and may assume that any person purporting to give receipt or
advice or make any statement or execute any document in connection with the
provisions hereof has been duly authorized to do so.
(k) The Company shall hold the Escrow Agent and its agents harmless
from, and indemnify and reimburse the Escrow Agent and its agents for all
claims, liability, loss and expense (including reasonable out-of-pocket and
incidental expenses and legal fees), incurred by the Escrow Agent or them in
connection
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with the Escrow Agent or their acting under this Agreement, provided that the
Escrow Agent or they, as the case may be, have not acted with gross negligence
or willful misconduct with respect to the events resulting in such claims,
liability, loss, and expense.
(l) The Company acknowledges and agree that, except as otherwise
provided in this Section 6(l), the Escrow Agent shall not be responsible for
taking any steps, including without limitation, the filing of forms or reports,
or withholding of any amounts in connection with any tax obligations of the
Company or any other party in connection with the Escrow Assets; provided,
however, that the Escrow Agent shall be entitled to take any action such as
withholding, that it deems appropriate to ensure compliance with its
obligations under any applicable tax laws. In no event shall the Escrow Agent
be required to distribute funds from the Escrow Account to either the
shareholders or the Company unless the appropriate Internal Revenue Service
Form W-8 or Form W-9 are received. Notwithstand ing the foregoing, the Escrow
Agent shall supply any information or documents as may be reasonably requested
by the Company in connection with the Company's preparation of its tax returns
for the Escrow Account. Upon any distribution of Escrow Assets in accordance
with the instructions set forth in Exhibit D attached hereto, the Escrow Agent
shall prepare and deliver to each person receiving a distribution a completed
Form 1099, and shall supply any necessary information as may reasonably be
requested in writing by such persons.
(m) The Escrow Agent does not have any interest in the Escrow
Assets deposited hereunder but is serving as escrow holder only and having only
possession thereof. The Company shall pay or reimburse the Escrow Agent upon
request for any transfer taxes or other taxes relating to the Escrow Assets
incurred in connection herewith and shall indemnify and hold harmless the
Escrow Agent from any amounts that it is obligated to pay in the way of such
taxes. This paragraph shall survive notwithstanding any termination of this
Escrow Agreement or the resignation of the Escrow Agent.
(n) The Escrow Agent makes no representation as to the validity,
value, genuineness or the collectability of any security or other document or
instrument held by or delivered to it.
(o) The Escrow Agent shall not be called upon to advise any party
as to the wisdom in selling or retaining or taking or refraining from any
action with respect to any securities or other property deposited hereunder.
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(p) No printed or other matter in any language (including without
limitation prospectuses, notices, reports and promotional material) which
mentions the Bank's name or the rights, powers, or duties of the Escrow Agent
shall be issued by the other parties hereto or on such parties, behalf unless
the Escrow Agent shall first have given its specific written consent thereto.
Notwithstanding the foregoing sentence, the Escrow Agent hereby specifically
consents to the use of its name as Escrow Agent as necessary to effectuate the
Company's public offering and a business combination of the Company.
(q) The Company authorizes the Escrow Agent, for any securities
held hereunder, to use the services of any United States central securities
depository it deems appropriate, including, but not limited to, the Depositary
Trust Company and the Federal Reserve Book Entry System.
6. Instructions: Fund Transfers.
(a) The Escrow Agent is authorized to rely and act upon all
instructions given or purported to be given by one or more officers, employees
or agents of the Company (i) authorized by or in accordance with a corporate
resolution delivered to the Escrow Agent or (ii) described as authorized in a
certificate delivered to the Escrow Agent by the appropriate Secretary or
Assistant Secretary or similar officer (each such officer, employee or agent or
combination of officers, employees and agents authorized pursuant to clause (i)
or described pursuant to clause (ii) of this Section 6(a) is hereinafter
referred to as an "Authorized Officer"). (The term "instructions" includes,
without limitation, instructions to sell, assign, transfer, deliver, purchase
or receive for the Escrow Account any and all stocks, bonds and other
securities or to transfer all or any portion of the Escrow Assets.) The Escrow
Agent may also rely and act upon instructions when bearing or purporting to
bear the signature or facsimile signature of any of the individuals designated
by an Authorized Officer regardless of by whom or by what means the actual or
purported facsimile signature or signatures thereon may have been affixed
thereto if such facsimile signature or signatures resemble the facsimile
specimen or specimens from time to time furnished to the Escrow Agent by any of
such Authorized Officers, Secretary or an Assistant Secretary or similar
officer). In addition, and subject to subsection 6(b) hereof, the Escrow Agent
may rely and act upon instructions received by telephone, telex, TXW facsimile
transmission, bank wire or other teleprocess acceptable to it which the Escrow
Agent believes in good faith to have been given by an Authorized Officer or
which are transmitted with proper testing or authentication pursuant to terms
and conditions which the Escrow Agent may specify. The Escrow Agent shall incur
no liability to the Company or otherwise for having acted in
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accordance with instructions on which it is authorized to rely pursuant to the
provisions hereof. Any instructions delivered to the Escrow Agent by telephone
shall promptly thereafter be confirmed in writing by an Authorized Officer but
the Escrow Agent shall incur no liability for a failure to send such
confirmation in writing, the failure of any such written confirmation to
conform to the telephone instruction which it received, the failure of any such
written confirmation to be signed or properly signed, or its failure to produce
such confirmation at any subsequent time. The Escrow Agent shall incur no
liability for refraining from acting upon any instructions which for any reason
it, in good faith, is unable to verify to its own satisfaction. Unless
otherwise expressly provided, all authorizations and instructions shall
continue in full force and effect until canceled or superseded by subsequent
authorizations or instructions received by the Escrow Agent's safekeeping
account administrator. The Escrow Agent's authorization to rely and act upon
instructions pursuant to this paragraph shall be in addition to, and shall not
limit, any other authorization which the Company may give to it hereunder.
(b) With respect to written or telephonic instructions or
instructions sent by facsimile transmission to transfer funds from the Escrow
Account in accordance herewith (such instructions hereinafter referred to as
"Transfer Instructions"), the security procedure agreed upon for verifying the
authenticity of Transfer Instructions is a callback by the Escrow Agent to any
of the persons designated below, whether or not any such person has issued such
Transfer Instruction. (It is recommended that the persons designated below not
be persons who generally issue Transfer Instructions; whenever possible, the
Escrow Agent will endeavor to call someone other than the issuer of the
Transfer Instructions).
With respect to Transfer Instructions given by the Company pursuant to
its authority under this Agreement:
Name/Title Telephone No.
Xxxxxx Xxxxxxxx, President (000) 000-0000
Xxxxxxx X. Xxxxxxxx, Secretary (000) 000-0000
Alternatively, at the Escrow Agent's option, the callback may be made
to any person designated in the certified resolutions or other certificates or
documentation furnished to it by a party in connection with the Escrow Account
as authorized to issue Transfer Instructions or otherwise transact business
with respect to the Escrow Account for that party. The Company shall implement
any other authentication method or procedure or security device required by the
Escrow Agent at any time or from time to time.
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7. Stockholder Redemption. In the event a stockholder exercises his or
her redemption right upon the Business Combination of the Company, the funds to
repay said stockholder shall be distributed directly from the Escrow Account.
As soon as practicable after the Company receives notice from a stockholder
that the stockholder is exercising its redemption rights, the Company shall
instruct the Escrow Agent to transfer, and (so long as the Escrow Agent has
received an Internal Revenue Service Form W-8 or Form W-9) the Escrow Agent
shall so transfer, the funds owed to the stockholder; such instructions to
include the amount to be transferred and delivery instructions. These
instructions shall comply with Section 6 of this Escrow Agreement.
8. Resignation or Removal of Escrow Agent.
(a) The Escrow Agent may resign at any time by giving written
notice to the Company. The Company may remove the Escrow Agent upon written
notice to the Escrow Agent. Such resignation or removal shall take effect upon
delivery of the Escrow Assets to a successor escrow agent designated in writing
by the Company, and the Escrow Agent shall thereupon be discharged from all
obligations under this Agreement, and shall have no further duties or
responsibilities in connection herewith. The obligations of the Company to the
Escrow Agent and the rights of the Escrow Agent under Sections 5, 6(c), and
6(h) hereof shall survive termination of this Agreement or the resignation or
removal of the Escrow Agent.
(b) In the event that the Escrow Agent submits a notice of
resignation, its only duty, until a successor Escrow Agent shall have been
appointed and shall have accepted such appointment, shall be to safekeep the
Escrow Assets, and hold, invest and dispose of the Escrow Assets in accordance
with this Agreement, until receipt of a designation of successor Escrow Agent
or a joint written disposition instrument by the other parties hereto or a
Final Order of a court of competent jurisdiction, but without regard to any
notices, requests, instructions, demands or the like received by it from the
other parties hereto after such notice shall have been given, unless the same
is a direction that the Escrow Assets be paid or delivered in its entirety out
of the Escrow Account. The Escrow Agent, upon submission of its resignation in
accordance with this subparagraph (b) may deposit the Escrow Assets with a
court of competent jurisdiction if the Escrow Agent deems such action
advisable. The resignation of the Escrow Agent will take effect on the earlier
of (a) the appointment of a successor (including a court of competent
jurisdiction) or (b) the day which is 30 days after the date of delivery of its
written notice of resignation to the other parties hereto. If, at the time the
Escrow Agent has not received a designation of a successor Escrow Agent, the
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Escrow Agent's sole responsibility after that time shall be to safe-keep the
Escrow Assets until receipt of a designation of a successor Escrow Agent or a
joint written disposition instrument by the other parties hereto or a final
order of a court of competent jurisdiction.
9. Notices. Unless expressly provided herein to the contrary, notices
hereunder shall be in writing, and delivered by telecopier, overnight express
mail, first-class postage prepaid, delivered personally or by receipted courier
service. All such notices which are mailed shall be deemed delivered upon
receipt if the addressee is the Escrow Agent, but shall be deemed delivered
upon mailing if otherwise, all such notices shall be addressed as follows (or
to such other address as any party hereto may from time to time designate by
notice duly given in accordance with this paragraph):
(a) If to the Company, to:
1997 Corp.
000 Xxxx 000xx Xxxxxx
Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxx, President
If to the Escrow Agent, to:
Continental Stock Transfer & Trust Co.
0 Xxxxxxxx 00xx xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxx
10. Miscellaneous.
(a) Choice of Law and Jurisdiction. This Agreement shall be
governed by and construed in accordance with the law of the State of New York
applicable to agreements made and to be performed in New York. The parties to
this Agreement hereby agree that jurisdiction over such parties and over the
subject matter of any action or proceeding arising under this Agreement may be
exercised by a competent Court of the State of New York sitting in New York
City or by a United States Court sitting in the Southern District of New York,
exclusively. The parties agree that delivery or mailing of any process or other
papers in the manner provided herein, or in such other manner as may be
permitted by law, shall be valid and sufficient service thereof.
(b) Benefits and Assignment. Nothing in this Agreement, expressed
or implied, shall give or be construed to give any person, firm or corporation,
other than the parties
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hereto and their successors and assigns, any legal claim under any covenant,
condition or provision hereof; all the covenants, conditions, and provisions
contained in this Agreement being for the sole benefit of the parties hereto
and their successors and assigns. No party may assign any of its rights or
obligations under this Agreement without (i) the written consent of all the
other parties, which consent may be withheld in the sole discretion of the
party whose consent is sought and (ii) the written agreement of the transferee
that it will be bound by the provisions of this Agreement.
(c) Counterparts. This Agreement may be executed in several
counterparts, each one of which shall constitute an original, and all
collectively shall constitute but one instrument.
(d) Amendment and Waiver. This Agreement may be modified only by a
written amendment signed by all the parties hereto, and no waiver of any
provision hereof shall be effective unless expressed in a writing signed by the
party to be charged.
(e) Headings. The headings of the sections hereof are included for
convenience of reference only and do not form part of this Agreement.
(f) Entire Agreement. This Agreement contains the complete
agreement of the parties with respect to its subject matter and supersedes and
replaces any previously made proposals, representations, warranties or
agreements with respect thereto by any of the parties hereto.
(g) Separability. Any provisions of this Agreement which may be
determined by competent authority to be prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or enforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
11. Additional Documentation. This Agreement shall not become
effective (and the Escrow Agent shall have not responsibility hereunder except
to return the Escrow Assets to the Company) until the Escrow Agent shall have
received from the Company the following:
(i) Certified resolutions of its board of directors authorizing the
making and performance of this Agreement; and
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(ii) A certificate as to the names and specimen signatures of its
officers or representatives authorized to sign the Agreement and
notices, instructions and other communications hereunder.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as
of the date first written above.
1997 CORP.
By:
---------------------------
Name: Xxxxxx Xxxxxxxx
Title: President
Agreed and accepted:
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
as Escrow Agent
By:
-------------------------------
Name:
Title:
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EXHIBIT A to ESCROW AGREEMENT
ESCROW ASSETS
-------------
One Hundred Fifty Thousand Dollars U.S. ($150,000)
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EXHIBIT B TO ESCROW AGREEMENT
INTENTIONALLY OMITTED
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EXHIBIT C TO ESCROW AGREEMENT
INVESTMENT INSTRUCTIONS
-----------------------
The Escrow Agent shall invest the Escrow Assets in bank deposits, a
registered investment company that holds itself out as a "money market fund"
meeting the conditions of paragraphs (c)(2), (c)(3) and (c)(4) of Rule 2a-7
under the Investment Company Act or short-term United States government
securities, including treasury bills, cash and cash equivalents.
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EXHIBIT D TO ESCROW AGREEMENT
DISBURSEMENT INSTRUCTION
1. Release of Escrow Assets to the Company. The Escrow Agent shall release the
Escrow Assets to the Company upon receipt by the Escrow Agent of:
(i) Written notice from the Company that the Company has completed a
transaction or series of trans actions in which the Company has
entered into a specific line of business, and a written
certification that the fair market value (as determined by the
Company, based upon standards generally accepted by the
financial community, including revenues, earnings, cash flow,
and book value) of the target exceeds eighty percent of the
offering proceeds described in Exhibit A, as required by the
Registration Statement; and
(ii) More than twenty percent of the shareholders of the Company have
not elected to redeem their Common Stock, as required by the
Registration Statement; and
(iii) All other actions required to be performed by the Company for
the release of the Escrow Assets have been met.
2. Distribution of Escrow Assets as to Stockholders. The Escrow Agent shall
disburse the Escrow Assets to the purchasers of record of the Company's
Common Stock in the Offering if:
(a) The Company has not met the conditions for release of the Escrow
Assets to the Company within 18 months from the effective date of the
Registration Statement; or
(b) The Company delivers written notice to the Escrow Agent that part of
the Escrow Assets should be distributed to those holders of record of
the Company's Common Stock sold in the Offering electing to have their
shares redeemed in accordance with the terms set forth in the
Registration Statement, as set forth in such notice.
3. Method of Release of Escrow Assets to the Company. Upon the occurrence of
receipt by the Escrow Agent of the written notice required paragraph 1
above, the Escrow Agent shall wire transfer the Escrow Assets to the
Company in accordance
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with the wire transfer instructions of the Company set forth in such
notice.
4. Method of Distribution of Escrow Assets to Stockholders. Upon the
occurrence of either of the events specified in Section 2(a) or 2(b) above,
the Escrow Agent shall distribute the Escrow Assets to the holders of
record of the Company Common Stock sold in the Offering by mail in
accordance with and to the address specified in the books and records of
the Company. The written notice required by Section 2 (a) or 2(b), as the
case may be, shall include the name and address of each such holder,
together with the percentage of the Escrow Assets to be distributed
thereto.
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EXHIBIT E TO ESCROW AGREEMENT
FEE SCHEDULE
------------
One Thousand ($1,000.00)Dollars Escrow Agent fee to CONTINENTAL STOCK TRANSFER
& TRUST COMPANY to be paid at Closing.
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