ONE OF ITS THEN MEMBERS TO ACT ON BEHALF
OF PARENT TO TAKE ALL NECESSARY ACTIONS AND MAKE ALL DECISIONS PURSUANT TO THE
ESCROW AGREEMENT REGARDING PARENT'S RIGHT TO INDEMNIFICATION PURSUANT TO ARTICLE
VII HEREOF.
IN THE EVENT OF A VACANCY IN SUCH COMMITTEE, THE BOARD OF DIRECTORS
OF PARENT SHALL APPOINT AS A SUCCESSOR A PERSON WHO WAS A DIRECTOR OF PARENT
PRIOR TO THE CLOSING DATE OR SOME OTHER PERSON WHO WOULD QUALIFY AS AN
"INDEPENDENT" DIRECTOR OF PARENT AND WHO HAS NOT HAD ANY RELATIONSHIP WITH THE
COMPANY PRIOR TO THE CLOSING.
SUCH COMMITTEE IS INTENDED TO BE THE "COMMITTEE"
REFERRED TO IN ARTICLE VII HEREOF AND THE ESCROW AGREEMENT.
6
(B)
STOCKHOLDERS' REPRESENTATIVE.
(I)
IN ORDER TO ADMINISTER EFFICIENTLY (I) THE IMPLEMENTATION OF THE
AGREEMENT ON BEHALF OF THE FORMER STOCKHOLDERS AND (II) THE SETTLEMENT OF ANY
DISPUTE WITH RESPECT TO THE AGREEMENT, THE COMPANY SHALL, PRIOR TO THE EFFECTIVE
TIME, DESIGNATE ONE TO THREE PERSONS TO ACT AS A REPRESENTATIVE ON BEHALF OF THE
FORMER STOCKHOLDERS (COLLECTIVELY, THE "REPRESENTATIVE").
BY APPROVING THIS
AGREEMENT, THE COMPANY'S STOCKHOLDERS AUTHORIZE AND EMPOWER THE COMPANY TO MAKE
SUCH DESIGNATION, APPROVE AND RATIFY ALL OF THE RIGHTS, POWERS AND AUTHORITIES
PROVIDED TO THE REPRESENTATIVE UNDER THE TERMS OF THIS AGREEMENT, AND AGREE TO
BE BOUND BY ALL DECISIONS AND OTHER ACTIONS TAKEN BY THE REPRESENTATIVE
(II)
IN ORDER TO REIMBURSE THE REPRESENTATIVE FOR ITS FEES AND
COSTS, AND TO FUND ANY COSTS OF DEFENSE OF ANY CLAIMS BY THE PARENT INDEMNITEES
UNDER ARTICLE VII AT THE CLOSING THE PARENT, AT THE DIRECTION OF THE COMPANY,
SHALL DEPOSIT $2,000,000 IN CASH OF THE TOTAL MERGER CONSIDERATION OTHERWISE
PAYABLE TO EACH OF THE COMPANY'S STOCKHOLDERS ON A PRO-RATA BASIS WITH A
FINANCIAL INSTITUTION IDENTIFIED BY THE COMPANY TO PARENT IN WRITING PRIOR TO
THE CLOSING (THE "REPRESENTATIVE ACCOUNT"), TO BE HELD UNTIL THE ESCROW PERIOD
HAS TERMINATED AND NO FURTHER CLAIMS REMAIN OUTSTANDING UNDER ARTICLE VII OR THE
ESCROW AGREEMENT.
THE FUNDS IN THE REPRESENTATIVE ACCOUNT SHALL BEAR INTEREST,
AND SUCH FUNDS TOGETHER WITH ANY INTEREST THEREON, LESS THE FEES AND COSTS OF
THE REPRESENTATIVE, AND ANY FEES OR COSTS INCURRED TO FUND COSTS OF DEFENSE FOR
ANY CLAIMS BY THE PARENT INDEMNITEES UNDER ARTICLE VII, SHALL, FOLLOWING
CLOSING, BE RETURNED TO EACH OF THE FORMER STOCKHOLDERS IN THE SAME PROPORTIONS
AS INITIALLY DEPOSITED IN THE REPRESENTATIVE ACCOUNT.
THE REPRESENTATIVE IS
HEREBY GRANTED THE AUTHORITY TO SEEK REIMBURSEMENT FROM THE REPRESENTATIVE
ACCOUNT FOR ITS FEES AND COSTS, AND TO FUND ANY COSTS OF DEFENSE OF ANY CLAIMS
BY THE PARENT INDEMNITEES UNDER ARTICLE VII.
IN NO EVENT SHALL PARENT OR ANY
PARENT INDEMNITEES HAVE ANY RIGHTS OR RECOURSE TO THE REPRESENTATIVE ACCOUNT,
EITHER FOR CLAIMS UNDER ARTICLE VII OR OTHERWISE.
IN NO EVENT SHALL THE PARENT
OR PARENT INDEMNITEES HAVE ANY RESPONSIBILITY OR OBLIGATION WITH RESPECT TO THE
REPRESENTATIVE ACCOUNT OTHER THAN TO DEPOSIT THE $2,000,000 REFERRED TO ABOVE
THEREIN.
(III)
FROM AND AFTER THE EFFECTIVE TIME, THE FORMER STOCKHOLDERS HEREBY