**Exhibit 10.17**

 

**STOCK ESCROW AGREEMENT**

 

STOCKESCROW AGREEMENT, dated as of October 19, 2005 (“Agreement”), by and amongFEDERAL SERVICES ACQUISITION CORPORATION, a Delaware corporation (“Company”),JOEL R. JACKS, PETER M. SCHULTE, Dr. EDWARD H. BERSOFF, ARTHUR L. MONEY andFSAC PARTNERS, LLC (collectively “Initial Stockholders”) and CONTINENTAL STOCKTRANSFER & TRUST COMPANY, a New York corporation (“Escrow Agent”).

 

WHEREAS,the Company has entered into an Underwriting Agreement, dated October  19,2005 (“Underwriting Agreement”), with CRT Capital Group LLC (the “Underwriter”),pursuant to which, among other matters, the Underwriter has agreed to purchase21,000,000 units (“Units”) of the Company. Each Unit consists of one share ofthe Company’s Common Stock, par value $.0001 per share, and two Warrants, eachWarrant to purchase one share of Common Stock, all as more fully described inthe Company’s final Prospectus, dated October  19, 2005 (“Prospectus”)comprising part of the Company’s Registration Statement on Form S-1 (File No.333-124638) under the Securities Act of 1933, as amended (“RegistrationStatement”), declared effective on October 19, 2005 (“Effective Date”).

 

WHEREAS,the Initial Stockholders have agreed as a condition of the sale of the Units todeposit their shares of Common Stock of the Company, as set forth oppositetheir respective names in Exhibit A attached hereto (collectively “EscrowShares”), in escrow as hereinafter provided.

 

WHEREAS,the Company and the Initial Stockholders desire that the Escrow Agent acceptthe Escrow Shares, in escrow, to be held and disbursed as hereinafter provided.

 

IT ISAGREED:

 

1.             Appointmentof Escrow Agent. The Company and the Initial Stockholders hereby appointthe Escrow Agent to act in accordance with and subject to the terms of thisAgreement and the Escrow Agent hereby accepts such appointment and agrees toact in accordance with and subject to such terms.

 

2.             Depositof Escrow Shares. On or before the Effective Date, each of the InitialStockholders shall deliver to the Escrow Agent certificates representing hisrespective Escrow Shares, to be held and disbursed subject to the terms andconditions of this Agreement. Each Initial Stockholder acknowledges that thecertificate representing his Escrow Shares is legended to reflect the depositof such Escrow Shares under this Agreement.

 

3.             Disbursementof the Escrow Shares. The Escrow Agent shall hold the Escrow Shares untilthe third anniversary of the Effective Date (“Escrow Period”), on which date itshall, upon written instructions from each Initial Stockholder, disburse eachof the Initial Stockholder’s Escrow Shares to such Initial Stockholders;provided, however, that if the Escrow Agent is notified by the Company pursuantto Section 6.7 hereof that the Company is being liquidated at any time duringthe Escrow Period, then the Escrow Agent shall promptly destroy thecertificates representing the Escrow Shares; provided further, however, thatif, after the Company consummates a Business Combination (as such term isdefined in the Registration Statement), it

 

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(or the surviving entity) subsequently consummates aliquidation, merger, stock exchange or other similar transaction which resultsin all of the stockholder of such entity having the right to exchange theirshares of Common Stock for cash, securities or other property, then the EscrowAgent will, upon receipt of a certificate, executed by the Chief ExecutiveOfficer or Chief Financial Officer of the Company, in form reasonablyacceptable to the Escrow Agent, that such transaction is then beingconsummated, and release the Escrow Shares to the Initial Stockholders uponconsummation of the transaction so that they can similarly participate. TheEscrow Agent shall have no further duties hereunder after the disbursement ordestruction of the Escrow Shares in accordance with this Section 3.

 

4.             Rightsof Initial Stockholders in Escrow Shares.

 

4.1.          VotingRights as a Stockholder. Subject to the terms of the Insider Letterdescribed in Section 4.4 hereof and except as herein provided, the InitialStockholders shall retain all of their rights as stockholders of the Companyduring the Escrow Period, including, without limitation, the right to vote suchshares.

 

4.2.          Dividendsand Other Distributions in Respect of the Escrow Shares. During the EscrowPeriod, all dividends payable in cash with respect to the Escrow Shares shallbe paid to the Initial Stockholders, but all dividends payable in stock orother non-cash property (“Non-Cash Dividends”) shall be delivered to the EscrowAgent to hold in accordance with the terms hereof. As used herein, the term “EscrowShares” shall be deemed to include the Non-Cash Dividends distributed thereon,if any.

 

4.3.          Restrictionson Transfer. During the Escrow Period, no sale, transfer or otherdisposition may be made of any or all of the Escrow Shares except (i) by giftto a member of Initial Stockholder’s immediate family or to a trust, thebeneficiary of which is an Initial Stockholder or a member of an InitialStockholder’s immediate family, (ii) by virtue of the laws of descent anddistribution upon death of any Initial Stockholder, or (iii) pursuant to aqualified domestic relations order; provided, however, that suchpermissive transfers may be implemented only upon the respective transferee’swritten agreement to be bound by the terms and conditions of this Agreement andof the Insider Letter signed by the Initial Stockholder transferring the EscrowShares. During the Escrow Period, the Initial Stockholders shall not pledge orgrant a security interest in the Escrow Shares or grant a security interest intheir rights under this Agreement.

 

4.4.          InsiderLetters. Each of the Initial Stockholders has executed a letter agreementwith the Company, dated as indicated on Exhibit A hereto, and which is filed asan exhibit to the Registration Statement (“Insider Letter”), respecting therights and obligations of such Initial Stockholder in certain events, includingbut not limited to the liquidation of the Company.

 

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5.             Concerningthe Escrow Agent.

 

5.1.          GoodFaith Reliance. The Escrow Agent shall not be liable for any action takenor 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 counselchosen by the Escrow Agent), statement, instrument, report or other paper ordocument (not only as to its due execution and the validity and effectivenessof its provisions, but also as to the truth and acceptability of anyinformation therein contained) which is believed by the Escrow Agent to begenuine and to be signed or presented by the proper person or persons. TheEscrow Agent shall not be bound by any notice or demand, or any waiver,modification, termination or rescission of this Agreement unless evidenced by awriting delivered to the Escrow Agent signed by the proper party or partiesand, if the duties or rights of the Escrow Agent are affected, unless it shallhave given its prior written consent thereto.

 

5.2.          Indemnification.The Escrow Agent shall be indemnified and held harmless by the Company from andagainst any expenses, including counsel fees and disbursements, or losssuffered by the Escrow Agent in connection with any action, suit or otherproceeding involving any claim which in any way, directly or indirectly, arisesout of or relates to this Agreement, the services of the Escrow Agenthereunder, or the Escrow Shares held by it hereunder, other than expenses orlosses arising from the gross negligence or willful misconduct of the EscrowAgent. Promptly after the receipt by the Escrow Agent of notice of any demandor claim or the commencement of any action, suit or proceeding, the EscrowAgent shall notify the other parties hereto in writing. In the event of thereceipt of such notice, the Escrow Agent, in its sole discretion, may commencean action in the nature of interpleader in an appropriate court to determineownership or disposition of the Escrow Shares or it may deposit the EscrowShares with the clerk of any appropriate court or it may retain the EscrowShares pending receipt of a final, non-appealable order of a court havingjurisdiction over all of the parties hereto directing to whom and under whatcircumstances the Escrow Shares are to be disbursed and delivered. Theprovisions of the Sections 5.2 and 5.7 shall survive in the event the EscrowAgent resigns or is discharged pursuant to Sections 5.5 or 5.6 below.

 

5.3.          Compensation.The Escrow Agent shall be entitled to reasonable compensation from the Companyfor all services rendered by it hereunder. The Escrow Agent shall also beentitled to reimbursement from the Company for all expenses paid or incurred byit in the administration of its duties hereunder including, but not limited to,all counsel, advisors’ and agents’ fees and disbursements and all taxes orother governmental charges.

 

5.4.          FurtherAssurances. From time to time on and after the date hereof, the Company andthe Initial Stockholders shall deliver or cause to be delivered to the EscrowAgent such further documents and instruments and shall do or cause to be donesuch further acts as the Escrow Agent shall reasonably request to carry out moreeffectively the provisions and purposes of this Agreement, to evidencecompliance herewith or to assure itself that it is protected in actinghereunder.

 

5.5.          Resignation.The Escrow Agent may resign at any time and be discharged from its duties asescrow agent hereunder by its giving the other parties hereto written noticeand

 

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such resignation shall become effective as hereinafterprovided. Such resignation shall become effective at such time that the EscrowAgent shall turn over to a successor escrow agent appointed by the Company, theEscrow Share held hereunder. If no new escrow agent is so appointed within the60 day period following the giving of such notice of resignation, the EscrowAgent may deposit the Escrow Shares with any court it reasonably deemsappropriate.

 

5.6.          Dischargeof Escrow Agent. The Escrow Agent shall resign and be discharged form itsduties as escrow agent hereunder if so requested in writing at any time by theCompany and a majority of the Initial Shareholders, jointly, provided, however,that such resignation shall become effective only upon acceptance ofappointment 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 berelieved from liability hereunder for its own gross negligence or its ownwillful misconduct.

 

5.8.          TrustFund Waiver. The Escrow Agent has no right, title, interest, or claim ofany kind (“Claim”) in or to any monies in the Trust Account (as defined in thatcertain Investment Management Trust Agreement, dated as of the date hereof, byand between the Company and Continental Stock Transfer & Trust Company, astrustee of the Trust Account), and hereby waives any Claim it may have in thefuture in or to any monies in the Trust Account, and hereby agrees not to seekrecourse, reimbursement, payment or satisfaction for any Claim against theTrust Account for any reason whatsoever.

 

6.             Miscellaneous.

 

6.1.          GoverningLaw. This Agreement shall for all purposes be deemed to be made under andshall be construed in accordance with the laws of the State of New York.

 

6.2.          ThirdParty Beneficiaries. Each of the Initial Stockholders hereby acknowledgesthat the Underwriter is a third party beneficiary of this Agreement and thisAgreement may not be modified or changed without the prior written consent ofCRT.

 

6.3.          EntireAgreement. This Agreement contains the entire agreement of the partieshereto with respect to the subject matter hereof and, except as expresslyprovided herein, may not be changed or modified except by an instrument inwriting signed by the party to be charged.

 

6.4.          Headings.The headings contained in this Agreement are for reference purposes only andshall not affect in any the meaning or interpretation thereof.

 

6.5.          BindingEffect. This Agreement shall be binding upon and inure to the benefit ofthe respective parties hereto and their legal representatives, successors andassigns.

 

6.6.          Notices.Any notice or other communication required or which may be given hereundershall be in writing and either be delivered personally or be mailed, certifiedor registered mail, or by private national courier service, return receiptrequested, postage prepaid,

 

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and shall be deemed given when so delivered personallyor, if mailed, two days after the date of mailing, as follows:

 

If tothe Company, to

 

Federal ServicesAcquisition Corporation

900 Third Avenue, 33rdFloor

New York, NY  10022-4775

Attn:  Chairman

 

If toa Stockholder, to his address set forth in Exhibit A.

 

and ifto the Escrow Agent, to:

 

Continental StockTransfer & Trust Company

17 Battery Place

New York, NY  10004

Attn:  Chairman

 

A copyof any notice sent hereunder shall be sent to:

 

Gusrae, Kaplan &Bruno, PLLC

120 Wall Street

11th Floor

New York, NY  10005

Attn:  Scott M. Miller, Esq.

 

and:

 

CRT Capital Group LLC

262 Harbor Drive

Stanford, CT 06902

Attn: Christopher Chase,Managing Director

 

and:

 

Bingham McCutchen LLP

399 Park Avenue

New York, NY 10022

Attn: Floyd Wittlin, Esq.

 

and:

 

Dechert LLP

30 Rockefeller Plaza

New York, NY  10112

Attn:  Gerald Adler, Esq.

 

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Theparties may change the persons and addresses to which the notices or othercommunications are to be sent by giving written notice to any such change inthe manner provided herein for giving notice.

 

6.7.          Liquidationof Company. The Company shall give the Escrow Agent written notification ofthe liquidation and dissolution of the Company in the event that the Companyfails to consummate a Business Combination within the time period(s) specifiedin the Prospectus.

 

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WITNESSthe execution of this Agreement as of the date first above written:

 
|   | FEDERAL SERVICES  ACQUISITION CORPORATION        |
|--------|--------------------------------------------------|
|   |                                             |
|   |                                             |
|   | By:                                              | /s/ JOEL R. JACKS |   |
|   |                                             | Joel R. Jacks, |
|   |                                             | Chairman and Chief  Executive Officer |
|   |                                             |
|   | INITIAL STOCKHOLDERS:                            |
|   |                                             |
|   |                                             |
|   | /s/ PETER M. SCHULTE                             |   |
|   | PETER M. SCHULTE                                 |
|   |                                             |
|   |                                             |
|   | /s/ JOEL R. JACKS                                |   |
|   | JOEL R. JACKS                                    |
|   |                                             |
|   |                                             |
|   | /s/ EDWARD H. BERSOFF                            |   |
|   | Dr. EDWARD H. BERSOFF                            |
|   |                                             |
|   |                                             |
|   | /s/ ARTHUR L. MONEY                              |   |
|   | ARTHUR L. MONEY                                  |
|   |                                             |
|   |                                             |
|   | FSAC PARTNERS, LLC                               |
|   |                                             |
|   |                                             |
|   | By:                                              | /s/ JOEL R. JACKS |   |
|   |                                             |  Name: Joel R. Jacks, on behalf of FSAC  Partners, LLC |
|   |                                             |  Title: Class A Member |
|   |                                             |
|   | CONTINENTAL STOCK  TRANSFER & TRUST  COMPANY |
|   |                                             |
|   |                                             |
|   | By:                                              | /s/ STEVEN NELSON |   |
|   |                                             | Name: Steven Nelson |
|   |                                             | Title: Chairman |
|        |                                                  |  |  |  |  |

 

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**EXHIBIT A**

 
| **Name and Address of  Initial Stockholder** | ** ** | **Number  of Shares** | ** ** | **Stock Certificate  Number** | ** ** | **Date of   Insider Letter** | ** ** |
|----------------------------------------------|------------|-----------------------|------------|-------------------------------|------------|------------------------------|------------|
|                                         |       |                  |       |                          |       |                         |       |
| Joel R. Jacks                                |       | 1,732,500             |       | 1                             |       | October 19, 2005             |       |
| Peter M. Schulte                             |       | 1,732,500             |       | 2                             |       | October 19, 2005             |       |
| Dr. Edward H. Bersoff                        |       | 525,000               |       | 3                             |       | October 19, 2005             |       |
| Arthur L. Money                              |       | 52,500                |       | 4                             |       | October 19, 2005             |       |
| FSAC Partners, LLC                           |       | 1,207,500             |       | 5                             |       | October 19, 2005             |       |

 

A-1

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