SECURITIES ESCROW AGREEMENT
SECURITIES
ESCROW AGREEMENT, dated as of [ ],
2008
(the “Agreement”) by and among Lank Acquisition Corp., a Delaware corporation
(the “Company”), the undersigned parties listed as the Initial Stockholders on
the signature page hereto (each an “Initial Stockholder” and 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 [ ],
2008
(“Underwriting Agreement”) with Citigroup
Global Markets Inc. (“Citi” or the
“Representative”),
acting
as representative
of the
several underwriters (collectively, the “Underwriters”), pursuant to which,
among other matters, the Underwriters have agreed to purchase 12,500,000
units
(not including the underwriters’ over-allotment option) (“Units”) of the
Company. Each Unit consists of one share of the Company’s common stock, par
value $.0001 per share (the “Common Stock”) and one warrant (“Warrant”), each
Warrant to purchase one share of Common Stock, all as more fully described
in
the Company’s definitive Prospectus, dated [ ],
2008
(“Prospectus”) comprising part of the Company’s Registration Statement on Form
S-1 (File No. 333-148001) under the Securities Act of 1933, as amended (the
“Registration Statement”), declared effective on [ ],
2008
(the “Effective Date”);
WHEREAS,
the Initial Stockholders have agreed, as a condition of the Underwriters’
obligation to purchase the Units pursuant to the Underwriting Agreement and
to
offer them to the public, to deposit all of their respective shares of Common
Stock, as set forth opposite their respective names on Exhibit A attached
hereto
(the “Escrow Shares”), in escrow as hereinafter provided;
WHEREAS,
the Company has entered into a Subscription Agreement with one of the Initial
Stockholders (the “Initial Warrantholder”), dated November 15, 2007 (the
“Subscription Agreement”), pursuant to which the Initial Warrantholder has
agreed to purchase 2,750,000 warrants (the “Private Warrants”) in a private
placement transaction;
WHEREAS,
the Initial Warrantholder has agreed as a condition of the sale of the Private
Warrants to deposit the Private Warrants (together with the Escrow Shares,
the
“Escrow Securities”), with the Escrow Agent as hereinafter provided;
and
WHEREAS,
the Company and the Initial Stockholders desire 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 Initial Stockholders hereby appoint the Escrow Agent to act
in
accordance with and subject to the terms of this Agreement and the Escrow
Agent
hereby accepts such appointment and agrees to act in accordance with and
subject
to such terms.
2.
Deposit
of Escrow Securities.
On or
before the Effective Date, the Initial Stockholders shall deliver to the
Escrow
Agent certificates representing their respective Escrow Securities, to be
held
and disbursed subject to the terms and conditions of this Agreement. The
Initial
Stockholders acknowledge and agree that the certificates representing the
Escrow
Securities will bear a legend to reflect the deposit of such Escrow Securities
under this Agreement.
3.
Disbursement
of the Escrow Securities.
The
Escrow Agent shall hold each of the Escrow Shares and the Private Warrants
until
the termination of their respective Escrow Period (as defined below). In
the
case of the Escrow Shares, the “Escrow Period” shall be the period beginning on
the date the certificates representing the Shares are deposited with the
Escrow
Agent and ending on the date that is the one year following the consummation
of
the initial Business Combination (as such term is defined in the Registration
Statement) or earlier if, subsequent
to the Business Combination, (i) the closing price of the Common Stock
equals or exceeds $16.00 per share for any 20 trading days within any 30-trading
day period commencing 90 days after the Business Combination or (ii) the
Company consummates a subsequent liquidation, merger, stock exchange or other
similar transaction which results in all of the Company stockholders having
the
right to exchange their shares of Common Stock for cash, securities or other
property.
In the
case of the Private Warrants, the “Escrow Period” shall be the period beginning
on the date the certificates representing the Private Warrants are deposited
with the Escrow Agent and ending on the 30th
day
after the date of the consummation of the initial Business Combination. On
the
termination date of the applicable Escrow Period, the Escrow Agent shall,
upon
written instructions from the Initial Stockholders, disburse the Escrow
Securities to such Initial Stockholders; provided, however, that if the Escrow
Agent is notified by the Company pursuant to Section 6.7 hereof that the
Company
is (i) being liquidated at any time during the Escrow Period, or (ii) that
up to
468,750 of the Escrow Shares have been forfeited, then the Escrow Agent shall
promptly destroy the certificates representing such Escrow Securities (or
portion thereof, as applicable). The Escrow Agent shall have no further duties
hereunder after the disbursement or destruction of the Escrow Securities
in
accordance with this Section 3.
4.
Rights
of Initial Holder in Escrow Securities.
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 the Escrow Shares.
4.2. Dividends
and Other Distributions in Respect of the Escrow Securities.
During
the Escrow Period, all dividends payable in cash with respect to the Escrow
Securities 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 Securities” shall be deemed to include the Non-Cash Dividends
distributed thereon, if any.
2
4.3. Restrictions
on Transfer.
During
the Escrow Period, no offer, sale, contract to sell, pledge, transfer, hedge
or
other disposition may be made of any or all of the Escrow Securities except
(i)
upon
the dissolution and liquidation of the Initial Warrantholder and the
distribution of assets to its members; (ii) by gift to a immediate family
member
of any Initial Stockholder or such Initial Stockholder’s members or to a trust,
the beneficiary of which is an immediate family member of such Initial
Stockholder or a member of the immediate family of the Initial Stockholder’s
members, (iii) by virtue of the laws of descent and distribution upon death
of
any Initial Stockholder or any member of the Initial Warrantholder, (iv)
pursuant to a qualified domestic relations order, (v)
in
the event of the Company’s liquidation prior to completion of its initial
Business Combination or (vi) in the event of the Company’s consummation of a
liquidation, merger, stock exchange or other similar transaction which results
in all of the Company’s stockholders having the right to exchange their shares
of common stock for cash, securities or other property subsequent to the
Company’s consummation of an initial Business Combination;
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 that is transferring the Escrow Shares. Even if transferred in
accordance with this Section 4.3, the Escrow Securities will remain subject
to
this agreement and may be released from escrow only in accordance with Section
3
hereof. During the Escrow Period, the Initial Stockholders shall not pledge
or
grant a security interest in the Escrow Securities or grant a security interest
in its rights under this Agreement.
4.4. Insider
Letters.
The
Initial Stockholders have executed a letter agreement with the
Representative
and the
Company, dated as of the Effective Date, and which is filed as an exhibit
to the
Registration Statement (each an “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 reasonable 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 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
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.
3
5.3. Compensation.
The
Escrow Agent shall be entitled to reasonable compensation from the Company
for
all services rendered by it hereunder, as set forth on Exhibit B hereto.
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.
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 and approved by the
Representative,
the
Escrow Securities 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 Securities with any court it 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.
4
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. Each of the
parties hereby agrees 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 irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive. Each of the parties hereby waives
any
objection to such exclusive jurisdiction and that such courts represent an
inconvenient forum.
6.2. Entire
Agreement.
This
Agreement and the Insider Letters contain 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.
6.3. Headings.
The
headings contained in this Agreement are for reference purposes only and
shall
not affect in any way the meaning or interpretation thereof.
6.4. Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the respective
parties hereto and their legal representative, successors and
assigns.
6.5. Notices.
Any
notice or other communication required or which may be given hereunder shall
be
in writing and either be delivered personally or by private national courier
service, or be mailed, certified or registered mail, return receipt requested,
postage prepaid, and shall be deemed given when so delivered personally or,
if
sent by private national courier service, on the next business day after
delivery to the courier, or, if mailed, two business days after the date
of
mailing, as follows:
if
to the
Escrow Agent, to:
American
Stock Transfer & Trust Company
[address]
Attn:
[ ]
Fax
No.:
[ ]
if
to the
Company, to:
00
Xxxxxxxxx Xxxxxx
Xxxxxxxxx,
XX 00000
Attn:
Xxxx X. Xxxxx, co-Chairman and co-President
if
to any
Initial Stockholder, to the address set forth in Exhibit A hereto.
in
either
case with a copy to:
5
Citigroup
Global Markets Inc.
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
General Counsel
Fax
No.:
(000) 000-0000
and
Ellenoff,
Xxxxxxxx & Schole LLP
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx X. Xxxxxxxx, Esq.
Fax
No.:
(000) 000-0000
and
Xxxxxxx
XxXxxxxxx
000
Xxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
Attn:
Xxx
Xxxxxxxxxxx, Esq.
Fax
No:
(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.
6.6. Liquidation
of Company; Forfeiture.
The
Company shall give the Escrow Agent written notification of (i) the liquidation
of the Company in the event that the Company fails to consummate the initial
Business Combination within the time period specified in the Prospectus or
(ii)
forfeiture of up to 468,750 Escrow Shares held by the Initial Warrantholder
if
the underwriters over-allotment option is not exercised in full, as further
described in the Registration Statement.
6.7. Trust
Account Waiver.
Notwithstanding anything herein to the contrary, the Escrow Agent hereby
waives
any and all right, title, interest or claim of any kind (“Claim”) in or to any
distribution of the trust account (the “Trust Account”) in which the proceeds of
the initial public offering conducted by the Company pursuant to the Prospectus
(the “IPO”) and the proceeds of the sale of the Private Warrants will be
deposited and held for the benefit of the holders of the securities purchased
in
the IPO, as described in greater detail in the Prospectus, and hereby agrees
not
to seek recourse, reimbursement, payment or satisfaction for any Claim against
the Trust Account for any reason whatsoever.
6.8. Counterparts.
This
Agreement may be executed in several counterparts each one of which shall
constitute an original and may be delivered by facsimile transmission and
together shall constitute one instrument.
6
[remainder
of page intentionally left blank]
WITNESS
the execution of this Agreement as of the date first above written.
By:
_________________________________
Name: Xxxx X. Xxxxx
Title: co-Chairman, co-President and co-Chief Financial Officer
AMERICAN
STOCK TRANSER & TRUST COMPANY
By:
_________________________________
Name:Title:
INITIAL
HOLDERS
LANK
ACQUISITION, LLC
By:
________________________________________
Name:
Title:
________________________________________
Xxxxxx
Xxxxxx
________________________________________
Xxxxxx
Xxxxxx
7
EXHIBIT
A
|
|
|
|
|
Investor
|
|
Investors
Address
and
Facsimile Number
|
|
Name:
Lank Acquisition, LLC.
Number
of Shares: 3,593,750 (up to 468,750 of
which
are subject to forfeiture in the
event
the underwriters over-allotment option is not
exercised
in full)
Number
of Warrants: 2,750,000
|
|
Attn:
Facsimile
Number:
|
|
Name:
Xxxxxx Xxxxxx
Number
of Shares: 20,000
Number
of Warrants: 0
|
Strategy
Associates, Inc.
000
Xxxx 00xx
Xxxxxx
Xxx
Xxxx, XX 00000
Phone:
000-000-0000
Fax:
000-000-0000
|
|
|
Name:
Xxxxxx Xxxxxx
Number
of Shares: 20,000
Number
of Warrants: 0
|
Phoenix
Capital Partners
000
Xxxxxx Xxxxxx
Xxxxxxxx,
XX 00000
Phone:
000-000-0000
Fax:
000-000-0000
|
8
EXHIBIT
B
Escrow
Agent Fees
$1,800
annually for acting agent escrow fee.
First
year agent fee to be paid at closing.
9
