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Exhibit 10.3
 

ESCROW AGREEMENT
 

This ESCROW AGREEMENT (this “Escrow Agreement”), dated as of August 16, 2010
(the “Closing Date”), between The Amacore Group, Inc., a Delaware corporation
(the “Company”), and Vicis Capital Master Fund, a series of the Vicis Capital
Master Trust, a trust formed under the laws of the Cayman Islands (the
“Purchaser”), and Quarles & Brady LLP, as escrow agent (“Escrow Agent”).
Capitalized terms used in this Escrow Agreement without definition shall have
the respective meanings ascribed to them in the Purchase Agreement.
 
R E C I T A L S
 
WHEREAS, Purchaser and Company are parties to a Securities Purchase Agreement
dated August 16, 2010 (the “Purchase Agreement”), whereby the Company agrees to
sell to the Purchaser up to $5,000,000 in principal amount of its 15% Senior
Secured Convertible Notes due June 30, 2011, in exchange for up to $5,000,000
cash (the “Purchase Price”).
 
WHEREAS, the parties wish to have the Escrow Agent hold a portion of the
Purchase Price in an escrow account and to release funds held in such account in
accordance with the terms hereof.
 
NOW, THEREFORE, the Purchaser and Company, intending to be legally bound, hereby
agree as follows:
 
1.           Appointment and Acceptance.  By their respective execution of this
Escrow Agreement, the Purchaser and Company hereby appoint and engage the Escrow
Agent, and the Escrow Agent hereby accepts such appointment and engagement, to
serve as escrow agent and to perform the duties, subject to the terms and
conditions, hereinafter set forth.
 
2.           Establishment of Escrow Account.  Immediately upon the execution of
this Escrow Agreement, the Escrow Agent shall establish an escrow sub-account
(the “Escrow Account”) in its IOLTA Trust Account into and from which certain
deposits and disbursements shall be made pursuant to the terms of this Escrow
Agreement.  The Escrow Agent shall hold and disburse all assets on deposit in
the Escrow Account (“Account Assets”) in accordance with the terms and
conditions hereof.
 
3.           Deposit into Escrow.  In accordance with Section 1.4(a) of the
Purchase Agreement, the Purchaser shall deposit into the Escrow Account an
aggregate of $2,500,000 cash.  Deposits into the Escrow Account shall be made as
follows:
 
A.B.A. #: xxxxxxxxxx
Swift Code: xxxxxxxxxx
Account #: xxxxxxxx

Name and Address on Bank Account:
Quarles & Brady LLP IOLTA Trust Account
411 East Wisconsin Ave., Suite 2040
Milwaukee, WI 53202-4497

 
 

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Bank Name & Address:
M&I Marshall & Ilsley Bank
770 North Water Street
Milwaukee, WI 53202

Reference:
121405.00006 (Vicis Capital)

Upon receipt of the deposit, the Escrow Agent shall advise the Company of the
amount of funds received into the Escrow Account.

 
4.           Disbursements From the Escrow Account.  Except for distributions in
connection with the termination of this Agreement pursuant to Section 6, the
Escrow Agent shall disburse funds from the Escrow Account only pursuant to and
in accordance with the written instruction made jointly by the Purchaser and
Company in the form attached hereto as Exhibit A (“Joint Disbursement
Instruction”).
 
5.           Disputes Regarding Disbursements.  If any dispute arises with
respect to the disbursement of the Account Assets, or if any disagreements arise
among the parties hereto with respect to the interpretation of this Escrow
Agreement, or concerning their rights and obligations hereunder, or the
propriety of any action contemplated by the Escrow Agent hereunder, or if the
Escrow Agent in good faith is in doubt what action should be taken hereunder,
the Escrow Agent shall not be obligated to resolve the dispute or disagreement
or to make any disbursement of all or any portion of the Account Assets, but may
commence an action in the nature of an interpleader without further investment
or disbursement of the Escrow Funds and seek to deposit the Account Assets with
a court of competent jurisdiction, and thereby be discharged from any further
duty or obligation with respect to the Account Assets.  Upon the interpleader
action being properly brought, all parties being joined and the Account Assets
being deposited with the court, the Escrow Agent shall be discharged from any
obligations accruing thereafter with respect to the Account Assets.  The Escrow
Agent, in its sole discretion, may, in lieu of filing such action in
interpleader, elect to cease performance under this Agreement in connection with
any instruction or notice received regarding disbursements of Account Assets
until the Escrow Agent has received: (a) a written notice of resolution of such
dispute or disagreement signed by the parties to such dispute or disagreement,
or (b) a certified copy of a final judgment of a court of competent
jurisdiction, provided, however, that a certified copy of a final judgment shall
serve as a valid de­termination only if the time for appeal has expired and no
appeal has been perfected or all appeals have been exhausted or no right of
appeal exists.
 
6.           Termination and Release of Escrow.  This Escrow Agreement shall
terminate upon the earlier of (the “Termination Date”):
 
(a)           the resignation of the Escrow Agent by providing written notice to
the parties hereto of the same; or
 
(b)           June 30, 2011.
 

 
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All funds remaining in the Escrow Account upon the Escrow Agent’s resignation
shall be delivered to any successor escrow agent mutually agreed to by the
Purchaser and Company. All funds held in the Escrow Account after June 30, 2011,
shall be distributed to the Purchaser by check or wire transfer to an account
designated by the Purchaser.
 
7.           Extent of Duties of Escrow Agent.
 
(a)           The Escrow Agent shall be responsible only for performance of its
duties as specified in this Escrow Agreement, and no implied covenants, duties
or obligations shall bind or be enforceable against the Escrow Agent.  The
Escrow Agent shall not be liable to any person or entity for any act or failure
to act unless due to the Escrow Agent’s fraud or willful misconduct.
 
(b)           Subject to Section 7(a) hereof, the Escrow Agent shall not be
liable for any action taken or omitted by it, or any action suffered by it to be
taken or administered in good faith and in the exercise of its own best
judgment, and may rely conclusively and shall be protected in acting in good
faith upon any order, notice, demand, certificate, advice of counsel (including
counsel selected by the Escrow Agent), statement, instrument, report or other
document (not only as to its due execution and the validity and effectiveness
thereof, but also as to the truth and acceptability of any information therein
contained) which is reasonably believed by the Escrow Agent to be genuine and to
be signed by the proper person or persons.
 
(c)           The Company shall indemnify the Escrow Agent and hold it harmless
from any and all claims, liabilities, damages, losses, or any other expenses,
fees or charges of any character or nature, which it may incur or with which it
may be threatened by reason of its acting as Escrow Agent under this Escrow
Agreement, including but not limited to any and all damages, costs, losses and
other expenses, including reasonable attorneys’ fees and expenses, resulting
from or arising in connection with any action, suit, or proceeding incident to
the Escrow Agent’s acting as such hereunder, unless such action, suit or
proceeding relates to the Escrow Agent’s gross negligence or willful misconduct.
 
8.           Conflict Waiver. THE COMPANY HEREBY ACKNOWLEDGES THAT THE ESCROW
AGENT IS ACTING AS LEGAL COUNSEL TO THE PURCHASER IN CONNECTION WITH THE
TRANSACTIONS CONTEMPLATED AND REFERRED TO HEREIN. THE COMPANY AGREES THAT IN THE
EVENT OF ANY DISPUTE ARISING IN CONNECTION WITH THIS AGREEMENT OR OTHERWISE IN
CONNECTION WITH ANY TRANSACTION OR AGREEMENT CONTEMPLATED AND REFERRED TO
HEREIN, THE ESCROW AGENT SHALL BE PERMITTED TO CONTINUE TO REPRESENT THE
PURCHASER AND THE COMPANY WILL NOT SEEK TO DISQUALIFY SUCH COUNSEL AND WAIVES
ANY OBJECTION THE COMPANY MIGHT HAVE WITH RESPECT TO THE ESCROW AGENT ACTING AS
THE ESCROW AGENT PURSUANT TO THIS AGREEMENT AND LEGAL COUNSEL TO THE PURCHASER.
 
9.           Entire Agreement.  This Escrow Agreement constitutes the full and
entire agreement of the parties hereto with respect to the subject matter
hereof.  This Escrow Agreement may be amended or modified only by a writing
signed by all of the parties hereto.  This Escrow Agreement also shall not be
construed to eliminate or reduce any duty, obligation or responsibility that the
Purchaser or Company may have under the Purchase Agreement and any agreements
ancillary thereto.
 

 
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10.           Notices.  All instructions, directions, demands, notices,
consents, requests and other documents authorized, required or permitted to be
given pursuant to this Agreement shall be delivered in accordance with the
Purchase Agreement.
 
11.           Successor and Assigns.  This Escrow Agreement may not be assigned
by the Purchaser, Company or Escrow Agent without the written consent of the
other parties hereto.  This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective permitted successors and
assigns.
 
12.           Severability.  In the event that any one or more provisions
contained in this Escrow Agreement shall be deemed or declared invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein shall not thereby be affected or
impaired in any way.
 
13.           Governing Law.  This Escrow Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York
without regard to conflict of law principles.
 
14.           Counterparts.  This Escrow Agreement and any Joint Disbursement
Instruction may be executed in multiple counterparts, each of which when so
executed shall be deemed an original, but all of which together shall constitute
one and the same agreement.
 
15.           No Waiver.  No course of dealing, nor any delay on the part of any
party in exercising any right hereunder, nor any failure to exercise the same,
shall operate as a waiver of such right.
 
16.           Headings Without Effect.  The headings used in this Escrow
Agreement are inserted as a matter of convenience and for reference only, and in
no way define, limit, extend or describe the scope of this Agreement or the
intent of any provision hereof.
 

 

 
[Signature Page To Follow]
 

 

 

 

 

 
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IN WITNESS WHEREOF, the parties have caused this Escrow Agreement to be duly
executed by their duly authorized rep­resentatives as of the day and year first
above written.

 
 

 
COMPANY:
 
THE AMACORE GROUP, INC.

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Name:
Title:

PURCHASER:

VICIS CAPITAL MASTER FUND
By: Vicis Capital LLC

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Name:
Title:

 

 
ESCROW AGENT:

QUARLES & BRADY LLP

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EXHIBIT A

 
JOINT DISBURSEMENT INSTRUCTION

Quarles & Brady LLP
411 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attn: Matthew C. Vogel
Fax: 414-978-8899
Email: matthew.vogel@quarles.com

Date: ______________

RE:  Joint Disbursement Instruction

This Joint Disbursement Instruction is made pursuant to that certain Escrow
Agreement (the “Escrow Agreement”), dated August 16, 2010, by and among Vicis
Capital Master Fund, The Amacore Group, Inc. and Quarles & Brady LLP, as escrow
agent.  Capitalized terms used but not defined herein shall have the respective
meanings ascribed to them in the Escrow Agreement.

Please transfer $_________________ from the Escrow Account to the account
specified below:

Name:                                                                                                                                         
 
Routing
Number:                                                                                                                                          
 
Bank Account
Number:                                                                                                                                          
 
Other Instructions (please
specify):                                                                                                                                
 

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THE AMACORE GROUP, INC.
 
 
 
______________________________
Name:
Title:
 
VICIS CAPITAL MASTER FUND
   By: Vicis Capital LLC
 
 
_______________________________
Name:
Title:
 

 
 
 
 
 

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