ESCROW AGREEMENT
This ESCROW AGREEMENT is made as of this ____ day of ________, 1996 by and
among ORION ACQUISITION CORP. I, with a place of business at 150 East 52nd
Street, New York, New York 10022 (the "Company"), H.J. MEYERS & CO., INC., with
its principal place of business at 1895 Mount Hope Avenue, Rochester, New York
14620 ("H.J. Meyers" or the "Representative"), and Citibank, N.A., a national
bank organized under the laws of the United States of America with a principal
place of business at 120 Wall Street, New York, New York 10043, in its capacity
as escrow agent only (the "Escrow Agent").
W I T N E S S E T H:
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WHEREAS, the Company intends to consummate the initial public offering (the
"Offering") of up to an aggregate of (i) 920,000 Units, including 120,000 Units
subject to the underwriters' over-allotment option (the "Units"), each Unit to
consist of (a) one (1) share of the Company's common stock, par value $.01 per
share (the "Common Stock") and (b) one (1) redeemable Class A Common Stock
Purchase Warrant to purchase one share of Common Stock (the "Class A Warrants"),
and (ii) 368,000 redeemable Class B Unit Purchase Warrants (the "Class B
Warrants"), including 48,000 Class B Warrants subject to the underwriters' over-
allotment option, each Class B Warrant to be exercisable for one (1) Unit, all
as more fully described in the Company's Registration Statement on Form SB-2
under the Securities Act of 1933, as amended (File No. 33-80647), as declared
effective by the Securities and Exchange Commission on ____________ (the
"Registration Statement");
WHEREAS, the Company has entered into an Underwriting Agreement dated
_____________ with the Representative of the underwriters named therein,
pursuant to which, among other matters, such underwriters have agreed to
purchase the Units and the Class B Warrants from the Company;
WHEREAS, in accordance with the terms of the Offering as set forth in the
Registration Statement, the gross proceeds from the sale of the Units are
required to be placed directly in an escrow account; and
WHEREAS, the Company and the Representative agree to appoint the Escrow
Agent as the escrow agent for such account, on the terms and conditions set
forth below;
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:
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1. APPOINTMENT OF ESCROW AGENT AND CREATION OF ACCOUNT. The Company and
the Representative hereby appoint the Escrow Agent as escrow agent hereunder and
direct 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 "Orion
Acquisition Corp. I - 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
Representative shall deposit with the Escrow Agent those assets listed on
Exhibit A.
2. INITIAL FUNDING OF ESCROW ACCOUNT. The Escrow Account shall be
initially funded with the proceeds from the sale of Units by the Representative
on behalf of the Company. All funds from the initial sale of Units by the
Representative shall be deposited directly in the Escrow Account by wire
transfer or certified check.
3. 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 accountings of such investments, the income received
therefrom, and the then existing balance of the Escrow Account to the Company.
4. 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 both the Company and the
Representative, and delivered to the Escrow Agent; provided that such
modification may not contravene Section 11-51-302(6) of the Colorado Revised
Statutes. 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 shall not
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be responsible for determining whether such instructions contravene Section 11-
51-302(6) of the Colorado Revised Statutes and 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.
5. 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 Exhibits E and F (the "Fee Schedule"). The Start-Up Fee, as
specified in the Fee Schedule, shall be paid by the Company upon the execution
of this Agreement. The Escrow Agent shall have no duties or liabilities under
this Agreement unless and until full payment of the Start-Up Fee. 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. The Company hereby grants to the Escrow Agent
a first lien on the Escrow Assets such that in the event that any and all
charges payable to the Escrow Agent under this Agreement shall not be timely
paid, the Escrow Agent shall have the right, without any prior action, to pay
itself from the Escrow Assets the full money owned. It is understood that the
Escrow Agent's fees may be adjusted from time to time to conform to its then
current guidelines.
6. 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
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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 in 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 interest 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, 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.
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(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, 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 Representative
(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
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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 and the Representative are jointly and severally
liable to hold the Escrow Agent and its agents harmless from, and indemnify and
reimburse the Escrow Agent and them, 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 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 and the Representative acknowledge and agree that,
except as otherwise provided in this Section 5(l), the
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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, the Representative 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, as
required by the Registration Statement. Notwithstanding 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 Escrowed
Property 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 Escrowed
Property 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.
(p) No printed or other matter in any language (including without
limitation prospectuses, notices, reports and promotional
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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 Bank 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 other parties hereto authorize 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.
7. 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 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, TWX, facsimile transmission, bank wire or other teleprocess
acceptable to it which the Escrow Agent believes in good faith to have been
given by an
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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 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 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.
---------- -------------
Arthur H. Goldberg/Chairman (212) 593-4747
of the Board and Chief
Executive Officer
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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.
8. 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, as required by the Registration
Statement) 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 7 of this
Escrow Agreement.
9. RESIGNATION OR REMOVAL OF ESCROW AGENT.
(a) The Escrow Agent may resign at any time by giving written notice
to the Company and the Representative. The Company and H.J. Meyers on behalf of
the Representative may remove the Escrow Agent upon joint 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 H.J. Meyers on behalf of the Representative, 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 and the Representative to the Escrow Agent and the
rights of the Escrow Agent under Sections 4, 5(c), and 5(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
Escrowed Assets, and hold, invest and dispose of
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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 Escrow Agent's sole responsibility after that time shall be to
safe-keep the Escrowed 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.
10. 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:
Orion Acquisition Corp. I
375 Park Avenue
New York, New York 10022
Attention: Chairman
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If to the Representative, to:
H.J. Meyers & Co., Inc.
1895 Mount Hope Avenue
Rochester, New York 14620
Attention: Mr. Michael Smith
(c) If to the Escrow Agent, to:
Citibank, N.A.
120 Wall Street, 13th Floor
New York, New York 10043
Attention: Corporate Agency and Trust
11. 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. 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 hereof.
(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 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.
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(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.
10. 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;
(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; and
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(iii) Counterpart signature pages to the escrow agreement being
executed simultaneously herewith among the Escrow Agent, the
Company and the current stockholders of the Company (the
"Stockholders"), executed by the Stockholders holding an
aggregate at least 66 2/3% of the issued and outstanding shares
of common stock of the Company as of the date hereof.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first written above.
ORION ACQUISITION CORP. I
By:__________________________
Name: Arthur H. Goldberg
Title: Chairman
H.J. MEYERS & CO., INC.
By:___________________________
Name:
Title:
Agreed and accepted:
CITIBANK, N.A.,
as Escrow Agent
By:___________________________
Name:
Title:
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EXHIBIT A to ESCROW AGREEMENT
ESCROW ASSETS
$
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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 short-term United
States government securities, including treasury bills, cash and cash
equivalents.
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EXHIBIT D to ESCROW AGREEMENT
DISBURSEMENT INSTRUCTIONS
1. RELEASE OF ESCROW ASSETS TO THE COMPANY. In accordance with Section 11-51-
302(6) of the Colorado Revised Statutes, the Escrow Agent shall release the
Escrow Assets to the Company upon receipt by the Escrow Agent of:
(a) Written notice from the Company that the Company has completed a
transaction or series of transactions in which at least 50% of the
gross proceeds of the Offering under the Securities Act of 1933, as
amended, is committed to a specific line of business, and that at
lease 10 days have lapsed since the Company filed a Notice of Proposed
Release of Escrow Assets from Escrow on Form ES with the Securities
Commissioner of the Colorado Division of Securities; and
(b) An opinion of counsel of the Company, reasonably acceptable to the
Escrow Agent, that:
(i) A Business Combination was approved by a vote of two-thirds of
the shares of Common Stock of the Company, as required by the
Registration Statement;
(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;
(iii)The fair market value (evidenced by a written
certification from the Company, 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 net value of
the assets of the Company, as required by the Registration
Statement; and
(iv) All other actions required by the Company for the release of the
Escrow Assets have been met.
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2. DISTRIBUTION OF ESCROW ASSETS AS TO STOCKHOLDERS. The Escrow Agent shall
disburse the Escrow Assets to the holders of record of the Company's Common
Stock if:
(a) Within 18 months of the date of effectiveness of the Offering (or
twenty-four months if the Escrow Agent has received notice within the
initial eighteen month period that the Extension Criteria, as defined
in the Prospectus used in the Offering, have been satisfied) the
Escrow Agent has not received written notice from the Company that the
Company has completed a transaction or series of transactions in which
at least 50% of the gross proceeds of the Offering is committed to a
specific line of business; or
(b) The Company delivers written notice to the Escrow Agent that all of
the Escrow Assets should be distributed to the holders of record of
the Company's Common Stock sold in the Offering in connection with the
liquidation of the Company; or
(c) The Company delivers written notice to the Escrow Agent that part of
the Escrow Assets should be distributed to 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.
3. METHOD OF RELEASE OF ESCROW ASSETS TO THE COMPANY. Upon receipt by the
Escrow Agent of the written notice required by paragraph 1 above, the
Escrow Agent shall wire transfer the Escrow Assets to the Company in
accordance 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), 2(b) or 2(c)
above, the Escrow Agent shall distribute the Escrow Assets to the holders
of record of the Company's 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
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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
See Attachment II
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EXHIBIT F
In the event that the Escrow Agent is requested to return funds to individual
subscribers, the following will apply:
- - There will be a charge of $10.00 for each check that is issued by the
Escrow Agent. Checks will be sent via First Class mail.
- - There will be a charge of $20.00 for each individual wire transfer, for
each individual subscriber or shareholder.
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