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EXHIBIT 10.89
ESCROW AGREEMENT
This Escrow Agreement (this "AGREEMENT") is made and entered into as of July
15, 1996 (the "EFFECTIVE DATE"), by and among McLeod, Inc., a Delaware
corporation ("MCLEOD"), certain shareholders and option holders of Ruffalo, Cody
& Associates, Inc. who are signatories to this Agreement (the "HOLDERS"), Albert
P. Ruffalo as the representative of the Holders (the "REPRESENTATIVE"), and
Norwest Bank N.A. as escrow agent (the "ESCROW AGENT"). The Effective Date of
this Agreement shall be the same date as the Effective Date of the Agreement and
Plan of Reorganization (as that term is defined below).
RECITALS
A. The Holders are certain shareholders and certain option holders of
Ruffalo Cody & Associates, Inc., an Iowa corporation ("RUFFALO"). Ruffalo,
McLeod and the Holders have entered into an Agreement and Plan of Reorganization
dated as of July 12, 1996 (the "PLAN"), pursuant to which Ruffalo will be merged
with and into McLeod Merging Co., an Iowa corporation that is a wholly-owned
subsidiary of McLeod ("MERGECO"), in a statutory merger (the "MERGER"), with
Mergeco to be the surviving corporation of the Merger. Capitalized terms used in
this Agreement and not otherwise defined herein will have the meanings given to
them in the Plan.
B. Pursuant to the Plan, Fifty thousand Dollars ($50,782) of the amount
to be paid to the Holders and 113,387 shares of the McLeod Class A Common stock
which are to be issued to the Holders are not to be immediately delivered to the
Holders but are to be delivered to Escrow Agent to be held in the escrow created
pursuant to this Agreement (the "Escrow") in an escrow account (an "Escrow
Account") and will be subject to cancellation and forfeiture under certain
conditions as set forth in this Agreement.
The parties agree as follows:
1. ESTABLISHMENT OF ESCROW.
1.1 Delivery of Cash, Escrow Shares and Stock Powers. Upon the
execution of this Agreement by all parties: (a) McLeod will deliver to the
Escrow Agent $50,782 in immediately available funds, and duly authorized and
113,387 executed stock certificates registered in the names of the Holders as
reflected on Exhibit A evidencing the Escrow Shares; and (b) the Holders will
deliver to the Escrow Agent duly executed Stock Powers and Assignments Separate
From Certificate in the form of Exhibit B ("STOCK POWERS"), signed in blank by
each of the Holders. The Escrow Agent agrees to accept delivery of the cash
(the "ESCROW FUND"), certificates evidencing the Escrow Shares and the Stock
Powers and to hold such Escrow Fund, Escrow Shares, the Stock
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Powers and all other Escrowed Items (as defined below) in escrow in the Escrow
Account pursuant to the terms and conditions of this Agreement. As used
herein, the term "ESCROWED ITEMS" means, collectively, the cash and interest
earned thereon, the stock certificates and instruments representing all of the
Escrow Shares and any Distributions and Secondary Distributions (as such terms
are defined below) then in the Escrow Account, the Stock Powers and all other
Escrowed Items then in the Escrow Account pursuant to this Agreement.
1.2 Investment of Escrow Funds. The Escrow Agent agrees to invest such
funds, from and after the date of this Agreement unless otherwise directed in a
joint writing by McLeod and the Representative, only in (a) short term
certificates of deposit of the Escrow Agent, overnight repurchase agreements,
United States government securities or securities of agencies in the United
States government which are guaranteed by the United States government or (b)
money market funds which are invested solely in the types of investments
described in clause (a) of this sentence. The Escrow Agent agrees to hold all
interest and other distributions or gains derived from such investments are
reinvestments, if any (collectively the "INTEREST") in escrow and to distribute
the same pursuant to Section 2. The Escrow Agent shall have no liability for
any loss resulting from its investments of the Escrow Fund.
1.3 Dividends, Voting and Rights of Ownership. So long as the Escrow
is in effect and the Escrowed Items have not been delivered and released to the
Holders or to McLeod as provided in Section 2 hereof, any cash dividends,
dividends payable in stock, securities or other property or other distributions
of any kind (including without limitation shares of McLeod Common Stock issued
in connection with a subdivision or split of McLeod's Common Stock) that are
paid, issued or made by McLeod in respect of the Escrow Shares (collectively,
the "DISTRIBUTIONS") or in respect of any such Distributions ("SECONDARY
DISTRIBUTIONS") will be immediately delivered to the Escrow Agent and will be
held in escrow in the Escrow Account on the same terms and conditions as those
applied to the Escrow Shares hereunder and the Holders will promptly sign and
deliver to the Escrow Agent new Stock Powers or other applicable instruments
of transfer for such Distributions and/or Secondary Distributions (duly
executed in blank by the Holders) to be held in escrow in the Escrow Account as
Escrowed Items pursuant to this Agreement. As used herein, the term "Escrow
Shares" shall include all Distributions and Secondary Distributions required to
be placed into the Escrow under this Agreement. The Holders will have the
right to vote the Escrow Shares deposited in the Escrow Account for their
account so long as such Escrow Shares are held in escrow, and McLeod will take
all steps necessary to allow the exercise of such rights. While the Escrow
Shares remain in the Escrow Agent's possession pursuant to this Agreement, the
Holders will (subject to the provisions of Section 1.3 below) retain and be
able to exercise all other incidents of ownership of the Escrow Shares that are
not inconsistent with the terms and conditions of this Agreement.
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1.4 No Transfer of or Encumbrance on Escrow Shares. No Escrow Shares,
Distributions, Secondary Distributions or other Escrowed Items or any beneficial
interest therein may be sold, assigned, pledged, encumbered or otherwise
transferred (including without limitation by operation of law) by the Holders
or any Holder or be taken or reached by any legal or equitable process in
satisfaction of any debt or other liability of a Holder (other than such
Holder's obligations under this Agreement) prior to the delivery and release to
the Holders of the Escrow Shares and other Escrowed Items by the Escrow Agent
in accordance with the provisions of Section 2 hereof.
1.5 Conditions to Release From Escrow; Purpose of Agreement. The
parties acknowledge and agree that, pursuant to the terms of Section 2 of the
Plan; the Holders are not entitled to receive any of the Escrowed Items out of
the Escrow until the dates referenced in Section 2 and only if between the date
of this Agreement and the dates referenced in Section 2, Mergeco is entitled to
receive an average of at least $450,000 in revenue per month from Sprint
Communications Company L.P. ("SPRINT") under the Independent Contractor Sales
Agreement between Ruffalo and Sprint entered into in May of 1995 ("CONTRACT").
If the average monthly revenues under the Contract do not equal at least
$450,000 then, subject to the provisions of this Agreement, McLeod and the
Escrow Agent will immediately be irrevocably and forever released of any
obligation to deliver any of the Escrow Funds, Escrow Shares or other Escrowed
Items to any of the Holders, the Escrow Fund and Interest, the stock
certificate(s) and other instruments representing the Escrow Shares, the Stock
Powers and other Escrowed Items will be delivered out of the Escrow to McLeod
for cancellation, such stock certificate(s), other instruments and the Escrow
Fund and Escrow Shares will be canceled by McLeod in accordance with this
Agreement, and the Holders will thereby immediately, irrevocably and forever
forfeit any right, title or interest of any kind in or to the Escrow Shares and
all other Escrowed Items.
2. RELEASE OF ESCROWED ITEMS FROM ESCROW.
2.1 Certain Definitions.
(a) First Release Date. As hereinafter used in this Agreement,
the term "FIRST RELEASE DATE" means six (6) months from the Effective Time.
(b) Second Release Date. As hereinafter used in this Agreement,
the term "SECOND RELEASE DATE" means nine (9) months from the Effective Time.
(c) Third Release Date. As hereinafter used in this Agreement,
the term "THIRD RELEASE DATE" means twelve (12) months from the Effective Time.
(d) Fourth Release Date. As hereinafter used in this Agreement,
the term "FOURTH RELEASE DATE" means fifteen (15) months from the Effective
Time.
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(e) Fifth Release Date. As hereinafter used in this Agreement,
the term "FIFTH RELEASE DATE" means eighteen (18) months from the Effective
Time.
2.2 Action by Escrow Agent. The cash and Interest in the Escrow Fund,
stock certificates representing the Escrow Shares, the Stock Powers and all
other Escrowed Items will be held in the Escrow Account by the Escrow Agent
until required to be released pursuant to Section 2.3 hereof.
2.3 Conditions for Release of Escrow Funds and Escrow Shares.
(a) Release to Holders on First Release Date. On or after the
First Release Date, upon receipt by Escrow Agent of a certificate signed by the
Representative and an officer of McLeod that the conditions of Section 1.5 have
been meet, then Escrow Agent shall promptly release from the Escrow Account the
Escrow Fund, all Interest accrued thereon and the shares of stock of McLeod
Inc., referenced on Exhibit 2.3(a) from the Escrow Shares, the Stock Powers
relating to those shares and any Distributions or Secondary Distributions with
respect to those shares to the Holders named on Exhibit 2.3(a).
(b) Release to Holders on Second Release Date. On or after the
Second Release Date, upon receipt by Escrow Agent of a certificate signed by the
Representative and an officer of McLeod that the conditions of Section 1.5 have
been meet, the Escrow Agent shall promptly release from the Escrow Account the
shares of stock of McLeod Inc., referenced on Exhibit 2.3 (b) from the Escrow
Shares, the Stock Powers relating to those shares and any Distributions or
Secondary Distributions with respect to those shares to the Holders named on
Exhibit 2.3(b).
(c) Release to Holders on Third Release Date. On or after the
Third Release Date, upon receipt by Escrow Agent of a certificate signed by the
Representative and an officer of McLeod that the conditions of Section 1.5 have
been meet, then Escrow Agent shall promptly release from the Escrow Account the
shares of stock of McLeod Inc., referenced on Exhibit 2.3(c) from the Escrow
Shares, the Stock Powers relating to those shares and any Distributions or
Secondary Distributions with respect to those shares to the Holders named on
Exhibit 2.3(c).
(d) Release to Holders on Fourth Release Date. On or after the
Fourth Release Date, upon receipt by Escrow Agent of a certificate signed by the
Representative and an officer of McLeod that the conditions of Section 1.5 have
been meet, then Escrow Agent shall promptly release from the Escrow Account the
shares of stock of McLeod Inc., referenced on Exhibit 2.3(d) from the Escrow
Shares, the Stock Powers relating to those shares and any Distributions or
Secondary Distributions with respect to those shares to the Holders named on
Exhibit 2.3(d).
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(e) Release to Holders on Fifth Release Date. On or after the
Fifth Release Date, upon receipt by Escrow Agent of a certificate signed by the
Representative and an officer of McLeod that the conditions of Section 1.5 have
been meet, then Escrow Agent shall promptly release from the Escrow Account the
shares of stock of McLeod Inc., referenced on Exhibit 2.3 (e) from the Escrow
Shares, the Stock Powers relating to those shares and any Distributions or
Secondary Distributions with respect to those shares to the Holders named on
Exhibit 2.3(e).
(f) Delivery of Escrow Funds. Delivery of Escrow Funds shall be
by wire transfer and delivery of Escrow Shares and other Escrowed Items by the
Escrow Agent shall be by registered mail or by nationally recognized overnight
courier. The Escrow Agent shall not be responsible for obtaining insurance in
connection with such delivery.
2.4 Power to Transfer Escrow Funds, Escrow Shares and Distributions.
The Escrow Agent is hereby granted the power to effect any transfer of Escrow
Shares, Distributions, Secondary Distributions and other Escrowed Items
contemplated by this Agreement.
3. ARBITRATION OF DISPUTES OVER ESCROW RELEASE. In the event that McLeod
and Representative cannot agree on whether a certificate is to be delivered on
a Release Date, any dispute shall be settled by binding mandatory arbitration
conducted in accordance with the provisions of this Section 3, unless McLeod
and the Holders independently settle such dispute in a written settlement
agreement executed by McLeod and each of the Holders.
3.1 Arbitration Rules. Any arbitration conducted pursuant to this
Agreement shall be held in Linn County, Iowa, and except as herein specifically
stated in accordance with the commercial arbitration rules of the American
Arbitration Association then in effect ("AAA RULES"). However, in all events,
these arbitration provisions shall govern over any conflicting rules which may
now or hereafter be contained in the AAA Rules. The arbitration will be heard
and decided by a single arbitrator who shall be selected as provided in Section
3.2. Any judgment upon the award rendered by the arbitrator may be entered in
any court having jurisdiction over the subject matter thereof. The arbitrator
shall have the authority to grant any equitable and legal remedies that would be
available in any judicial proceeding instituted to resolve the dispute that is
the subject of such arbitration.
3.2 Selection of Arbitrator. The American Arbitration Association will
have the authority to select an arbitrator from a list of arbitrators who are
attorneys-at-law who practice law; provided that the arbitrator cannot have
represented either McLeod or any of the Holders in any previous matter.
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3.3 Decision and Award. The final decision and award of the
arbitrator will be furnished to the Escrow Agent, the Holders and McLeod in
writing and will constitute a final and conclusive determination of the issue or
issues in question, binding upon the Holders and McLeod.
3.4 Compensation of Arbitrator. Any such arbitration will be
conducted before a single arbitrator, selected as provided above, who will be
compensated for his or her services at a rate to be determined by the parties or
by the American Arbitration Association, but based upon reasonable hourly or
daily consulting rates for the arbitrator in the event the parties are not able
to agree upon his or her rate of compensation.
3.5 Payment of Costs. McLeod, on the one hand, and the Holders, on
the other hand, will each pay 50% of the initial compensation to be paid to the
arbitrator in any such arbitration and 50% of the costs of transcripts and other
normal and regular expenses of the arbitration proceedings; provided, however,
that the prevailing party in any arbitration will be entitled to an award of its
attorneys' fees and costs, and all costs of arbitration, including those
provided for above, will be paid by the losing party, and the arbitrator will be
authorized to make such determinations.
3.6 Burden of Proof. For any claim submitted to an arbitration
hereunder, the burden of proof will be as it would be if the claim were
litigated in a judicial proceeding.
3.7 Award. Upon the conclusion of any arbitration proceedings
hereunder, the arbitrator will render findings of fact and conclusions of law
and a written opinion setting forth the basis and reasons for any decision
reached and will deliver such documents to each party to this Agreement along
with a signed copy of the award.
3.8 Terms of Arbitration. The arbitrator chosen in accordance with
these provisions will not have the power to alter, amend or otherwise affect the
terms of these arbitration provisions or the provisions of this Agreement or the
Non-Competition Agreement.
3.9 Exclusive Remedy. Except as specifically otherwise provided in
this Agreement, arbitration will be the sole and exclusive remedy of the parties
for any dispute arising over the release of Escrowed Items from the Escrow
Account hereunder.
4. LIMITATION OF ESCROW AGENT'S RESPONSIBILITY.
(a) Limitation of Responsibility. The Escrow Agent's duties are
limited to those set forth in this Agreement, and the Escrow Agent, acting as
such under this
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Agreement, is not charged with knowledge of or any duties or responsibilities
under any other document or agreement, including without limitation the Plan or
the Non-Competition Agreement. The Escrow Agent may execute any of its powers or
hereunder and exercise any rights hereunder either directly or by or response
through its agents or attorneys. Nothing in this Escrow Agreement will be deemed
to impose upon the Escrow Agent any duty to qualify to do business or to act as
a fiduciary or otherwise in any jurisdiction. The Escrow Agent will not be
responsible for, and will not be under a duty to examine into or pass upon, the
validity, binding effect, execution or sufficiency of this Escrow Agreement or
of any agreement amendatory or supplemental hereto.
(b) Limitation of Liability. The Escrow Agent will incur no
liability with respect to any action taken, not taken or suffered by it in
reliance upon any notice, direction, instruction, consent, statement or other
document believed by it to be genuine and duly authorized, nor for any other
action or inaction, except its own willful misconduct or gross negligence. In
all questions arising under this Agreement, the Escrow Agent may rely on the
advice of counsel, and for anything done, omitted or suffered in good faith by
the Escrow Agent based on such advice, the Escrow Agent will not be liable to
anyone. The Escrow Agent will not be required to take any action hereunder
involving any expense unless the payment of such expense is made or provided for
in a manner satisfactory to it. The Escrow Agent will not be liable for any
action taken or omitted to be taken by it in good faith unless a court of
competent jurisdiction determines that the Escrow Agent's willful misconduct or
gross negligence was the primary cause of any loss to McLeod or any Holder. The
Escrow Agent makes no representation or warranty with respect to and is not
responsible for the validity of the Escrow Shares or of any option rights that
may be issued with respect to any Escrow Shares. The Escrow Agent is not
responsible for the receipt of any dividend or other distribution on behalf of
any Holder or for the voting of or exercise of any other rights with respect to
the Escrow Shares. The Escrow Agent will have no duty to solicit any Escrow
Shares or any Distributions. The Escrow Agent will have no obligation with
respect to the Escrow Shares other than either to withhold release of Escrow
Shares from Holders or to release Escrow Shares to McLeod for cancellation, as
appropriate, to the extent expressly provided in this Agreement.
(c) Indemnity. McLeod and each of the Holders (each an "INDEMNIFYING
PARTY" and together the "INDEMNIFYING PARTIES"), each hereby jointly and
severally covenants and agrees to reimburse, indemnify and hold harmless the
Escrow Agent and its employees and agents from and against any loss, damage,
liability or loss suffered, incurred by or asserted against the Escrow Agent
(including amounts paid in settlement of any action, suit, proceeding, or claim
brought or threatened to be brought and including reasonable expenses of legal
counsel) arising out of, in connection with or based upon any act or omission by
the Escrow Agent relating in any way to this Agreement or the Escrow Agent's
services hereunder. This indemnity will not apply to
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gross negligence or willful misconduct on the Escrow Agent's part. Anything in
this Agreement to the contrary notwithstanding, in no event will the Escrow
Agent be liable for special, indirect or consequential damage or loss of any
kind whatsoever (including but not limited to lost profits), even if the Escrow
Agent has been advised of the likelihood of such loss or damage and regardless
of the form of action.
(d) Participation in Defense of the Escrow Agent. Each Indemnifying
Party may participate at its own expense in the defense of any claim or action
that may be asserted against the Escrow Agent, and if the Indemnifying Parties
so elect, the Indemnifying Parties may assume the defense of such claim or
action; provided, however, that if there exists a conflict of interest that
would make it inappropriate for the same counsel to represent both the Escrow
Agent and the Indemnifying Parties, the Escrow Agent's retention of separate
counsel will be reimbursable as herein above provided. The Escrow Agent's right
to indemnification hereunder will survive the Escrow Agent's resignation or
removal as escrow agent hereunder and will survive the termination of this
Agreement by lapse of time or otherwise.
(e) Notice of Claims against Escrow Agent. The Escrow Agent will
notify each Indemnifying Party by letter, or by telephone or telecopy confirmed
by letter, of any receipt by the Escrow Agent of a written assertion of a claim
against the Escrow Agent, or any action commenced against the Escrow Agent,
within ten (10) business days after the Escrow Agent's receipt of written
notice of such claim. However, the Escrow Agent's failure to so notify each
Indemnifying Party will not operate in any manner whatsoever to relieve an
Indemnifying Party from any liability that it may have otherwise than on
account of this Section 4.
5. SUCCESSOR ESCROW AGENT. In the event the Escrow Agent becomes
unavailable or unwilling to continue in its capacity herewith, the Escrow Agent
may resign and be discharged from its duties or obligations hereunder by giving
notice of its resignation to McLeod and the Representative, specifying a date
not less than ten (10) days following such notice date of when such resignation
will take effect. McLeod will designate a successor Escrow Agent prior to the
expiration of such ten (10) day period by giving written notice to the Escrow
Agent and the Representative. McLeod may appoint a successor Escrow Agent
without the consent of the Holders or the Representative so long as such
successor is a bank with assets of at least $50 million, and may appoint any
other successor Escrow Agent with the consent of the Representative, which will
not be unreasonably withheld. The Escrow Agent will promptly transfer the
Escrow Shares to such designated successor. If no successor is appointed,
Escrow Agent may apply to a court of competent jurisdiction for such
appointment.
6. HOLDERS' REPRESENTATIVE. For purposes of this Agreement, the Holders
have consented to the appointment of the Representative as representative of
the Holders and as the attorney-in-fact for and on behalf of each Holder, and,
subject to the express
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limitations set forth below, the taking by the Representative of any and all
actions and the making of any decisions required or permitted to be taken by
him under this Agreement, including but not limited to the exercise of the
power to authorize delivery to McLeod of the Escrow Shares and take all actions
necessary in the judgment of the Representative for the accomplishment of the
foregoing and all of the other terms, conditions and limitations of this
Agreement. The Representative will have unlimited authority and power to act
on behalf of each Holder with respect to this Agreement and the disposition,
settlement or other handling of all claims, rights or obligations arising under
this Agreement so long as all Holders are treated in the same manner. The
Holders will be bound by all actions taken by the Representative in connection
with this Agreement, and McLeod will be entitled to rely on any action or
decision of the Representative. In performing his functions hereunder, the
Representative will not be liable to the Holders in the absence of negligence
or willful misconduct. The Representative may resign from such position,
effective upon a new representative being appointed in writing by Holders who
beneficially own a majority of the Escrow Shares.
7. EXPENSES.
(a) Escrow Agent. All fees and expenses of the Escrow Agent incurred
in the ordinary course of performing its responsibilities hereunder will be
paid by McLeod upon receipt of a written invoice by the Escrow Agent. Any
extraordinary fees and expenses, including without limitation any fees or
expenses incurred by the Escrow Agent in connection with a dispute over the
distribution of Escrow Shares, will be paid by McLeod.
(b) Representatives. The Representative will not be entitled to
receive any compensation from McCleod or the Holders in connection with this
Agreement.
8. NOTICES. All notices, instructions and other communications required
or permitted to be given hereunder or necessary or convenient in connection
herewith must be in writing and will be deemed given (1) when personally
delivered or when delivered by telex or facsimile (to the telex or facsimile
number of the person to whom the notice is given), (1i) the first business day
following the date of deposit with an overnight courier service or (i11) on the
earlier of actual receipt or the third business day following the date on which
the notice is deposited in the United States mail, by first class certified or
registered mail, postage prepaid, addressed as follows:
If to the Escrow Agent Norwest Bank, N.A.
101 3rd Avenue SW
Cedar Rapids, Iowa 52404
Attn:
Telecopier:
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If to McLeod: McLeod, Inc.
221 3rd Avenue SE
Suite 500
Cedar Rapids, Iowa 52401
Attn:
Telecopier: 319-298-7008
If to the Representative: Al Ruffalo
Ruffalo Cody & Associates, Inc.
421 4th Avenue SE
Cedar Rapids, Iowa 52401
Telecopier:
or to such other address as McLeod, the Representative or the Escrow Agent, as
the case may be, designates in a notice given to each of the other parties
hereto in the manner provide herein.
9. GENERAL.
(a) Governing Law, Assigns. This Agreement will be governed by and
construed in accordance with the internal laws of the State of Iowa without
regard to conflict-of-law principles and will be binding upon, and inure to the
benefit of, the parties hereto and their respective successors and permitted
assigns.
(b) Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
(c) Entire Agreement. Except as otherwise set forth in the Plan, this
Agreement (together with the Non-Competition Agreement) constitutes the entire
understanding and agreement of the parties with respect to the subject matter
of this Agreement and supersedes all prior agreements or understandings,
written or oral, between the parties with respect to the subject matter hereof.
(d) Waivers. No waiver by any party hereto of any condition or of any
breach of any provision of this Agreement will be effective unless in writing.
No waiver by any party of any such condition or breach, in any one instance,
will be deemed to be a further or continuing waiver of any such condition or
breach or a waiver of any other condition or breach of any other provision
contained herein.
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(e) Amendment. This Agreement may be amended by the written agreement
of McLeod, the Escrow Agent and the Holders, provided that, if the Escrow Agent
does not agree to an amendment agreed upon by McLeod and the Holders, the
Escrow Agent will resign (which resignation shall be effective immediately and,
in any event, prior to the effective date of the amendment) and McLeod will
appoint a successor Escrow Agent in accordance with Section 5 above. No such
amendment may treat any one Holder differently from the other Holders unless
consented to in writing by Holders having beneficial ownership in a majority of
the outstanding Escrow Shares, including the consent of any Holder who is to be
treated differently.
(f) Miscellaneous. Escrow Agent may execute any of its powers or
responsibilities hereunder and exercise any rights hereunder either directly or
by or through its agents or attorneys. Nothing in this Escrow Agreement shall
be deemed to impose upon Escrow Agent any duty to qualify to do business or act
as a fiduciary or otherwise in any jurisdiction other than the State of Iowa.
Escrow Agent shall not be responsible for and shall not be under a duty to
examine into or pass upon the validity, binding effect, execution or
sufficiency of this Escrow Agreement or of any agreement amendatory or
supplemental hereto.
(g) Counterparts. This Agreement may be executed in counterparts, all
of which shall together constitute one instrument.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first above written.
MCLEOD ESCROW AGENT
MCLEOD, INC. NORWEST BANK N.A.
BY: /s/ CLARK MCLEOD BY: /s/ GREG NEUMEYER
--------------------- -----------------------
TITLE: TITLE: Sr. Trust Officer
------------------ --------------------
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THE HOLDERS
ALLSOP VENTURE PARTNERS III,
L.P.
BY: Mark Venture Partners, L.P.
General Partner
/s/ ALBERT P. RUFFALO BY: /s/ PAUL D. RHINES
- ------------------------------- -----------------------------
Albert P. Ruffalo Paul D. Rhines, General Partner
/s/ JOSEPH P. CUNNINGHAM /s/ LAURA L. DEMENT
- ------------------------------- -----------------------------
Joseph P. Cunningham Laura L. Dement
/s/ RANDY A. SNYDER /s/ BRIAN P. DONNELLY
- ------------------------------- ------------------------------
Randy A. Snyder Brian P. Donnelly
/s/ CLARK E. MCLEOD /s/ MARY E. MCLEOD
- ------------------------------- ------------------------------
Clark E. McLeod Mary E. McLeod
/s/ ERIC HENDER /s/ JULIE HENDER
- ------------------------------- ------------------------------
Eric Hender Julie Hender
RUFFALO, CODY & ASSOCIATES, INC.
401(k) and Profit Sharing Plan
BY: /s/ ALBERT P. RUFFALO
----------------------------
Albert P. Ruffalo, Trustee
BY: /s/ JOSEPH P. CUNNINGHAM
----------------------------
Joseph P. Cunningham, Trustee
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EXHIBIT A
MCLEOD
NAME OF RCAI SHAREHOLDERS: # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 29,171
ALBERT P. RUFFALO 27,456
JOSEPH P. CUNNINGHAM 14,260
LAURA L. DEMENT 14,316
RANDY A. SNYDER 7,228
BRIAN P. DONNELLY 7,228
CLARK E. MCLEOD 5,792
MARY E. MCLEOD 5,792
ERIC HENDER 1,072
JULIE HENDER 1,072
ART CHRISTOFFERSEN 0
ESOP SHARES 0
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113,387
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EXHIBIT 2.3(A)
AT SIX MONTHS
MCLEOD
NAME OF SHAREHOLDERS: CASH # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 0 29,171
ALBERT P. RUFFALO 0 0
JOSEPH P. CUNNINGHAM 0 0
LAURA L. DEMENT 0 0
RANDY A. SNYDER 0 0
BRIAN P. DONNELLY 0 0
CLARK E. MCLEOD 0 0
MARY E. MCLEOD 0 5,792
ERIC HENDER 0 1,072
JULIE HENDER 0 1,072
ART CHRISTOFFERSEN 0 0
MIKE SEPULVEDA 0 0
DUANE JASPER 0 0
JIM BARNES 0 0
SALLY SIMMONS 0 0
ESOP SHARES 50,782 0
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TOTALS 50,782 37,107
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EXHIBIT 2.3(B)
AT NINE MONTHS
MCLEOD
NAME OF SHAREHOLDERS: # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 0
ALBERT P. RUFFALO 6,864
JOSEPH P. CUNNINGHAM 3,565
LAURA L. DEMENT 3,579
RANDY A. SNYDER 1,807
BRIAN P. DONNELLY 1,807
CLARK E. MCLEOD 1,448
MARY E. MCLEOD 0
ERIC HENDER 0
JULIE HENDER 0
ART CHRISTOFFERSEN 0
ESOP SHARES 0
-------
19,070
-------
16
EXHIBIT 2.3(C)
AT TWELVE MONTHS
MCLEOD
NAME OF SHAREHOLDERS: # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 0
ALBERT P. RUFFALO 6,864
JOSEPH P. CUNNINGHAM 3,565
LAURA L. DEMENT 3,579
RANDY A. SNYDER 1,807
BRIAN P. DONNELLY 1,807
CLARK E. MCLEOD 1,448
MARY E. MCLEOD 0
ERIC HENDER 0
JULIE HENDER 0
ART CHRISTOFFERSEN 0
ESOP SHARES 0
-------
19,070
-------
17
EXHIBIT 2.3(D)
AT FIFTEEN MONTHS
MCLEOD
NAME OF SHAREHOLDERS: # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 0
ALBERT P. RUFFALO 6,864
JOSEPH P. CUNNINGHAM 3,585
LAURA L. DEMENT 3,579
RANDY A. SNYDER 1,807
BRIAN P. DONNELLY 1,807
CLARK E. MCLEOD 1,448
MARY E. MCLEOD 0
ERIC HENDER 0
JULIE HENDER 0
ART CHRISTOFFERSEN 0
ESOP SHARES 0
-------
19,070
-------
18
EXHIBIT 2.3(E)
AT EIGHTEEN MONTHS
MCLEOD
NAME OF SHAREHOLDERS: # OF SHARES
- ----------------------------------------------------------------------
ALLSOP VENTURE PARTNERS III 0
ALBERT P. RUFFALO 6,864
JOSEPH P. CUNNINGHAM 3,585
LAURA L. DEMENT 3,579
RANDY A. SNYDER 1,807
BRIAN P. DONNELLY 1,807
CLARK E. MCLEOD 1,448
MARY E. MCLEOD 0
ERIC HENDER 0
JULIE HENDER 0
ART CHRISTOFFERSEN 0
ESOP SHARES 0
-------
19,070
-------