be part of the Escrow Property) shall be returned by the General Partner directly to eachsubscriber in proportion to their respective subscriptions and to the period their respectivesubscriptions were held in escrow. If subscriptions for Units in the aggregate value of $2,000,000have not been received during the Initial Offering Period, as evidenced by an affidavit of theGeneral Partner attesting to said fact, the Escrow Property will be paid over and delivered by theEscrow Agent directly to subscribers as soon as practicable after receipt of written directionsfrom the General Partner.     3. Prior to delivery of the Escrow Property to the Partnership as described in Paragraph 2above, the Partnership shall have no title to or interest in the funds on deposit, and such fundsshall under no circumstances be subject to the payment or satisfaction of the liabilities orindebtedness of the Partnership.     4. The Escrow Agent shall cause all funds deposited with it pursuant to this Escrow Agreementto be maintained and invested as the General Partner shall from time to time direct by writteninstructions delivered to the Escrow Agent, in an interest-bearing money market account oraccounts, which can be readily liquidated on twenty-four hours notice, in an amount equal to thecollected balances in the account or accounts, as permitted under the Commission’s Rule 240.15c2-4.     5. Within 15 days of receipt of a subscription agreement, the General Partner may notify theEscrow Agent that a subscription agreement of a subscriber has not been accepted, and the GeneralPartner may direct the Escrow Agent by written instruction to return any funds held in the EscrowAccount for the benefit of such subscriber directly to such subscriber, together with suchsubscriber’s proportionate share of any interest earned on the Escrow Property during the periodsuch funds were held in escrow.     6. The Initial Offering Period for the Units shall mean a period of 90 days commencing on thedate of the Partnership’s Private Placement Offering Memorandum and Disclosure Document unless theGeneral Partner terminates the offering at an earlier date or extends the Initial Offering Periodfor up to an additional 60 days in which case the Initial Offering Period shall mean such period asso terminated or extended. The General Partner shall provide the Escrow Agent with prompt writtennotice of any such termination or extension.     7. Any of the persons whose names and signatures appear on Schedule 1 annexed hereto areauthorized by the General Partner to deliver any instruction or notice to the Escrow Agent requiredor permitted by this Escrow Agreement.
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     8. (a) As Escrow Agent hereunder, you shall have no duties or responsibilities except thoseexpressly set forth herein. The Escrow Agent shall act hereunder merely as a depository and in aministerial capacity. The Escrow Agent shall not be deemed to be a trustee for any person. In theevent checks are received which represent proceeds of subscriptions, Escrow Agent will deposit thechecks for collection, but shall be under no duty to enforce the collection of any check. TheEscrow Agent shall not be responsible for the form, terms, validity or negotiability of the checks,the validity of any signature on any check, or the authority of any person to sign or issue anycheck.          (b) The Escrow Agent may consult with counsel and shall be fully protected with respect to anyaction taken or omitted by it in good faith on advice of counsel and you shall have no liabilityhereunder except for your bad faith or negligence. You shall have no responsibility as to thevalidity or value of the Escrow Property and you may rely on any certificate, statement, request,consent, agreement or other instrument which you believe to be genuine and to have been signed orpresented by a proper person or persons. You shall not be bound by any modification of this EscrowAgreement unless in writing and signed by all parties hereto and actually received by you and, ifyour duties as Escrow Agent hereunder are affected, unless you shall have given prior writtenconsent thereto. In the event that you shall be uncertain as to your duties or rights hereunder orshall receive instructions from any of the undersigned with respect to the Escrow Property which,in your opinion, are in conflict with any of the provisions of this Escrow Agreement, you shall beentitled to refrain from taking any action other than to retain the Escrow Property until you shallbe directed otherwise in writing by the unanimous consent of the parties hereto or by final orderof a court of competent jurisdiction.          (c) The Escrow Agent may, at its own discretion, refuse to accept any deposits lacking therequired documentation or containing discrepancies.          (d) In any event when the Escrow Agent receives disbursement instructions, it is expresslyunderstood and agreed that the Escrow Agent shall not be required to make any such disbursementuntil such amount is, to the Escrow Agent’s satisfaction, available in cleared funds. Further, inno event shall the aggregate amount of payments made by the Escrow Agent exceed the amount ofEscrow Property.     9. Any notice which the Escrow Agent is required or desires to give hereunder to any of theundersigned shall be in writing and shall be deemed to have been duly given on the date of serviceif served personally on the party to whom notice is to be given, on the following day if given bytelegram, or on the third day after mailing if mailed to the
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party to whom notice is to be given by first class mail, registered or certified with returnreceipt requested, postage prepaid, and properly addressed as follows:       To: Smith Barney Potomac Futures Fund L. P.    and Smith Barney Futures Management Inc.         390 Greenwich Street — 1st floor    New York, New York 10013    Attention: Mr. David J. Vogel       To: Smith Barney Inc.         390 Greenwich Street — 1st floor    New York, New York 10013    Attention: Mr. David J. VogelNotices to the Escrow Agent shall be in writing and shall not be deemed to be given until actuallyreceived by the Escrow Agent. Whenever under the terms hereof the time for giving a notice orperforming an act falls upon a Saturday, Sunday or bank holiday, such time shall be extended to theEscrow Agent’s next business day.     10. If any property subject hereto is at any time attached, garnished or levied upon, shallbecome or be the subject of any court order, or in case the payment, assignment, transfer,conveyance or delivery of the Escrow Property shall be stayed or enjoined by any court order, or incase any order, judgment or decree shall be made or entered by any court affecting such property,or any part thereof, then in any of such events the Escrow Agent is authorized, in its solediscretion, to rely upon and comply with any such order, writ, judgment or decree, which it isadvised by legal counsel of its own choosing, is binding upon it, and if it complies with any suchorder, writ, judgment or decree, it shall not be liable to any of the parties hereto or to anyother person, firm, or corporation for any losses, claims, costs, payments or expenses by reason ofsuch compliance, even though such order, writ, judgment or decree may be subsequently reversed,modified, annulled, set aside or vacated.     11. The Escrow Agent may resign by giving ten (10) days’ written notice to the undersigned,and thereafter shall deliver the Escrow Property to a successor escrow agent acceptable to allparties hereto, which acceptance shall be evidenced by the joint written and signed order of theundersigned. If no such order is received by the Escrow Agent by such resignation date, theobligations of the Escrow Agent shall nevertheless cease and terminate and the Escrow Agent isunconditionally and irrevocably authorized and empowered to send the Escrow Property by registeredor certified mail to the respective subscribers thereof.
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     12. SB shall reimburse the Escrow Agent for all out-of-pocket expenses (including, withoutlimitation, New York taxes and other governmental charges) incurred by you in connection with yourduties hereunder and shall indemnify you against and save you harmless against any and all claims,liabilities, costs, payments and expenses, including fees of counsel (who may be selected by you),for anything done or omitted by you in the performance of this Agreement, except as a result ofyour own negligence or bad faith, and you shall have a lien on the Escrow Property for the amountthereof. All such fees and expenses shall be paid by SB.     13. In addition, SB agrees to pay the Escrow Agent an Escrow Agent fee of $2,500 per EscrowAccount established. Additionally, SB agrees to pay applicable fees as set forth in Schedules 2and 3 annexed hereto.     14. In the event that any checks or other instruments deposited in the account or accountsestablished to hold the Escrow Property prove uncollectible after the funds represented therebyhave been released pursuant to the Agreement, SB shall promptly reimburse the Escrow Agent thereforupon request, and the Escrow Agent shall deliver the returned checks or other instruments to SB.     15. Nothing in this Agreement is intended to or shall confer upon anyone other than theparties hereto any legal or equitable right, remedy or claim. This Agreement shall be governed by,and its provisions construed in accordance with, the laws of the State of New York, and may bemodified only in writing executed by all parties hereto.
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     16. This Agreement may be executed in one or more counterparts, but in such event eachcounterpart shall constitute an original and all of such counterparts shall constitute oneAgreement.Dated as of April 15, 1997         Parties to the Escrow         SMITH BARNEY POTOMAC    FUTURES FUND L.P.           By: Smith Barney    Futures Management Inc.,    General Partner           By /s/ David J. Vogel                  SMITH BARNEY FUTURES MANAGEMENT INC.           By /s/ David J. Vogel                  SMITH BARNEY INC.           By /s/ David J. Vogel              ACCEPTED:       EUROPEAN AMERICAN BANK       By         
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SCHEDULE 1       Name Title Signature         David J. Vogel President andDirector /s/ David J. Vogel                Jack H. Lehman, III Chairmanand Director /s/ Jack H. Lehman, III                Daniel A. Dantuono Treasurer,Director and ChiefFinancial Officer /s/ Daniel A. Dantuono         
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