Document:

exv10w27

Exhibit 10.27

FORM OF ESCROW AGREEMENT

     THIS ESCROW AGREEMENT (as the same may be amended or modified from time to time pursuant
hereto, this “Agreement”) is made and entered into as of                            , 2010, by and among
XStream Systems, Inc., a Delaware corporation (the “Company”), W.R. Hambrecht + Co., LLC, a
Delaware limited liability company (“Underwriter”, and together with the Company, sometimes
referred to individually as “Party” or collectively as the “Parties”), and JPMorgan Chase Bank,
National Association (the “Escrow Agent”). All capitalized terms not herein defined shall have the
meaning ascribed to them in that certain Registration Statement on Form S-1 (File No. 333-163046)
(as amended from time to time, the “Registration Statement”) filed by the Company with the U.S.
Securities and Exchange Commission.

     WHEREAS, pursuant to the terms of the Registration Statement, the Company desires to offer and
sell in its initial public offering (the “Offering”) a minimum  of 3,333,334 shares of common stock,
$0.0001 par value (“Shares”) equal to gross proceeds of $20,000,000 (“Minimum Amount”) and a
maximum of 5,000,000 Shares (“Maximum Amount”);

     WHEREAS,
unless the Minimum Amount is sold following the closing of the
auction, pricing and by the end
of the T+3 period (the third trading day after pricing) (the “Termination Date”), the Offering shall terminate and all funds shall be
returned to the purchasers of the Shares (“Investors”) in the Offering without interest;

     WHEREAS, the Company and Underwriter desire to establish an escrow account with the Escrow
Agent into which the Company and Underwriter shall instruct Investors introduced to the Company by
Underwriter to deposit funds by wire transfer to JPMorgan Chase Bank, N.A., to the escrow account
titled “JPMorgan as Escrow Agent for XStream Systems, Inc.”, Attention : Greg Kupchynsky,
Telephone: 212.623.6812, which account information is set forth on Schedule 3 hereto, and Escrow
Agent is willing to accept said funds subject to the terms and conditions set forth herein.

     NOW THEREFORE, in consideration of the foregoing and of the mutual covenants hereinafter set
forth, the parties hereto agree as follows:

1.     Appointment. The Parties hereby appoint the Escrow Agent as their escrow agent for the
purposes set forth herein, and the Escrow Agent hereby accepts such appointment under the terms and
conditions set forth herein. Contemporaneously herewith, the Parties have established an escrow
account with the Escrow Agent, which escrow account is entitled “XStream Systems, Inc. IPO Escrow
Account” (the “Escrow Account”). The Underwriter will instruct purchasers of the Shares to transfer
funds for deposit to the Escrow Account by wire transfer payable to “JPMorgan Chase Bank as Escrow
Agent for XStream Systems, Inc.”

2.     Fund. In compliance with Rule 10b-9 and Rule 15c2-4 of the Securities Exchange Act of
1934, as amended (the “Exchange Act”), all funds received from Investors in payment for the Shares
shall be forwarded to the Escrow Agent, by the Underwriter no later than noon (Eastern time) the
next business day after receipt, to be deposited into the Escrow Account. The Escrow Agent agrees
to hold all monies so deposited in the Escrow Account (the “Escrow Deposit”) for the benefit of the
Parties hereto and the Investors until authorized to disburse such monies under the terms of this Agreement. The
Escrow Agent shall hold the
Escrow Deposit and, subject to the terms and conditions hereof, shall hold the Escrow Deposits in a
non-interest bearing account (the “Fund”) as directed in Section 3.

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3.     No Investment of Fund. During the term of this Agreement, the Fund shall not be
invested in a JPMorgan Money Market Deposit Account nor a successor or similar investment offered
by the Escrow Agent, unless otherwise instructed by the Parties and as shall be acceptable to the
Escrow Agent.

4.     Disposition and Termination. (a) The Fund shall be paid by the Escrow Agent in
accordance with the following:

     (i) In the event that the Company and the Underwriter advise the Escrow Agent in writing that
the Offering has been terminated (the “Termination Notice”), the Escrow Agent shall promptly return
the funds paid by each Investor to said Investor without interest or offset. The Underwriter shall
provide to the Escrow Agent an electronic spreadsheet or list in a form acceptable to the Escrow
Agent containing the amount received from each Investor whose funds have been deposited with the
Escrow Agent (with respect to each Investor the “Investor Investment Amount”) along with the name
and address of each Investor. The aggregate of all Investor Investment Amounts shall be equal to
the amount of the Fund on the offering closing date.

     (ii) Provided that the Escrow Agent does not receive the Termination Notice in accordance with
paragraph 4(a)(i) and there is the Minimum Amount deposited into the Escrow Account on or prior to
the Termination Date, the Escrow Agent shall, upon written notification from the Parties, promptly
inform the Company and the Underwriter of the Minimum Amount that has been deposited in the
account on such date. Then upon receipt of written instructions in a form and substance
satisfactory to the Escrow Agent, received from the Company and Underwriter, pay the Fund in
accordance with such written instructions, such payment or payments to be made by wire transfer as
soon as practicable after receipt of such written instructions. The Parties agree among themselves
that, such instructions will not be provided by the Company and Underwriter unless
all closing conditions pursuant to the Underwriting Agreement by and between the Company and the
Underwriter have been met and, including without limitation, the conditions that the Company have
received confirmation from the NYSE Amex that the Shares will be listed on the NYSE Amex and that
the Minimum Amount has been received by the Escrow Agent.  After receipt of the aforementioned confirmation,
 the Parties will send written release instructions to the Escrow Agent via facsimile, in accordance with
Section 10, herein.  The Company understands and agrees that the Company shall not have rights to or be
entitled to any Investor funds on deposit in the Fund and no such Investor funds shall become the property
of the Company except following the release of the funds to the Company by the Escrow Agent pursuant to
Section 4 of this Agreement.

     (iii) If by (x) 3:00 PM Eastern time on the Termination Date, the total amount of the Fund is
less than the Minimum Amount, or (y) 5:00 PM Eastern Time on the Termination Date, the Escrow Agent
has not received written instructions from the Company and the Underwriter regarding the
disbursement of the Fund, then the Escrow Agent shall be directed to return the Fund to the
Investors pro rata without interest and/or offset, and in accordance with the Investor release
requirements referenced in Section 4.(a), (i) herein.

     (iv) The Escrow Agent shall not be required to pay any uncollected funds or any funds that are
not available for withdrawal.

     (v) If the Termination Date or any date that is a deadline under this Agreement for giving the
Escrow Agent notice or instructions or for the Escrow Agent to take action is not a Banking Day,
then such date shall be the Banking Day immediately subsequent to that date.

(b) Upon delivery of the Fund by the Escrow Agent, this Agreement shall terminate, subject to the
provisions of Section 8(b).

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5.     Escrow Agent. (a) The Escrow Agent shall have only those duties as are specifically
and expressly provided herein, which shall be deemed purely ministerial in nature, and no other
duties shall be implied. The Escrow Agent shall neither be responsible for, nor chargeable with,
knowledge of, nor have any requirements to comply with, the terms and conditions of any other
agreement, instrument or document between the Parties, in connection herewith, if any, including
without limitation the Underwriting Agreement by and between the Company and the Underwriter dated
the date set forth in the Company’s Rule 424 final prospectus filed as a part of the Registration
Statement (the “Underlying Agreement”), nor shall the Escrow Agent be required to determine if any
person or entity has complied with the Underlying Agreement, nor shall any additional obligations
of the Escrow Agent be inferred from the terms of the Underlying Agreement, even though reference
thereto may be made in this Agreement. In the event of any conflict between the terms and
provisions of this Agreement, those of any Underlying Agreement, any schedule or exhibit attached
to the Agreement, or any other agreement among the Parties, the terms and conditions of this
Agreement shall control. The Escrow Agent may rely upon and shall not be liable for acting or
refraining from acting upon any written notice, document, instruction or request furnished to it
hereunder and believed by it to be genuine and to have been signed or presented by the proper Party
or Parties without inquiry and without requiring substantiating evidence of any kind. The Escrow
Agent shall not be liable to any Party, any beneficiary or other person for refraining from acting
upon any instruction setting forth, claiming, containing, objecting to, or related to the transfer
or distribution of the Fund, or any portion thereof, unless such instruction shall have been
delivered to the Escrow Agent in accordance with Section 11 below and the Escrow Agent has been
able to satisfy any applicable security procedures as may be required thereunder. The Escrow Agent
shall be under no duty to inquire into or investigate the validity, accuracy or content of any such
document, notice, instruction or request. The Escrow Agent shall have no duty to solicit any
payments which may be due it or the Fund, including, without limitation, the Escrow Deposit nor
shall the Escrow Agent have any duty or obligation to confirm or verify the accuracy or correctness
of any amounts deposited with it hereunder.

(b) The Escrow Agent shall not be liable for any action taken, suffered or omitted to be taken by
it in good faith except to the extent that a final adjudication of a court of competent
jurisdiction determines that the Escrow Agent’s gross negligence or willful misconduct was the
primary cause of any loss to either Party. The Escrow Agent may execute any of its powers and
perform any of its duties hereunder directly or through affiliates or agents. The Escrow Agent may
consult with counsel, accountants and other skilled persons to be selected and retained by it. The
Escrow Agent shall not be liable for any action taken, suffered or omitted to be taken by it in
accordance with, or in reliance upon, the advice or opinion of any such counsel, accountants or
other skilled persons. In the event that the Escrow Agent shall be uncertain or believe there is
some ambiguity as to its duties or rights hereunder or shall receive instructions, claims or
demands from any Party hereto which, in its opinion, conflict with any of the provisions of this
Agreement, it shall be entitled to refrain from taking any action and its sole obligation shall be
to keep safely all property held in escrow until it shall be given a direction in writing by the
Parties which eliminates such ambiguity or uncertainty to the satisfaction of Escrow Agent or by a
final and non-appealable order or judgment of a court of competent jurisdiction. The Parties agree
to pursue any redress or recourse in connection with any dispute without making the Escrow Agent a
party to the same. Anything in this Agreement to the contrary notwithstanding, in no event shall
the Escrow Agent be liable for special, incidental, punitive, indirect or consequential loss or
damage 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.

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6.     Succession. (a) The Escrow Agent may resign and be discharged from its duties or
obligations hereunder by giving thirty (30) days advance notice in writing of such resignation to
the Parties specifying a date when such resignation shall take effect. If the Parties have failed
to appoint a successor
escrow agent prior to the expiration of thirty (30) days following receipt of the notice of
resignation, the Escrow Agent may petition any court of competent jurisdiction for the appointment
of a successor escrow agent or for other appropriate relief, and any such resulting appointment
shall be binding upon all of the parties hereto. Escrow Agent’s sole responsibility after such
thirty (30) day notice period expires shall be to hold the Fund (without any obligation to reinvest
the same) and to deliver the same to a designated substitute escrow agent, if any, or in accordance
with the directions of a final order or judgment of a court of competent jurisdiction, at which
time of delivery Escrow Agent’s obligations hereunder shall cease and terminate, subject to the
provisions of Section 8(b). In accordance with Section 8(b), the Escrow Agent shall have the right
to withhold an amount equal to any amount due and owing to the Escrow Agent, plus any costs and
expenses the Escrow Agent shall reasonably believe may be incurred by the Escrow Agent in
connection with the termination of the Agreement.

     (b) Any entity into which the Escrow Agent may be merged or converted or with which it may be
consolidated, or any entity to which all or substantially all the escrow business may be
transferred, shall be the Escrow Agent under this Agreement without further act.

7.     Compensation and Reimbursement. The Parties agree jointly and severally (a) to pay the
Escrow Agent upon execution of this Agreement and from time to time thereafter reasonable
compensation for the services to be rendered hereunder, along with any fees or charges for
accounts, including those levied by any governmental authority which the Escrow Agent may impose,
charge or pass-through, which unless otherwise agreed in writing shall be as described in Schedule
2 attached hereto, and (b) to pay or reimburse the Escrow Agent upon request for all expenses,
disbursements and advances, including, without limitation reasonable attorney’s fees and expenses,
incurred or made by it in connection with the performance, modification and termination of this
Agreement. The obligations contained in this Section 7 shall survive the termination of this
Agreement and the resignation, replacement or removal of the Escrow Agent.

     8.     Indemnity. (a) The Parties shall jointly and severally indemnify, defend and hold
harmless the Escrow Agent and its affiliates and their respective successors, assigns, directors,
agents and employees (the “Indemnitees”) from and against any and all losses, damages, claims,
liabilities, penalties, judgments, settlements, litigation, investigations, costs or expenses
(including, without limitation, the fees and expenses of outside counsel and experts and their
staffs and all expense of document location, duplication and shipment)(collectively “Losses”)
arising out of or in connection with (i) the Escrow Agent’s execution and performance of this
Agreement, tax reporting or withholding, the enforcement of any rights or remedies under or in
connection with this Agreement, or as may arise by reason of any act, omission or error of the
Indemnitee, except in the case of any Indemnitee to the extent that such Losses are finally
adjudicated by a court of competent jurisdiction to have been primarily caused by the gross
negligence or willful misconduct of such Indemnitee, or (ii) its following any instructions or
directions, whether joint or singular, from the Parties, except to the extent that its following
any such instruction or direction is expressly forbidden by the terms hereof. The indemnity
obligations set forth in this Section 8(a) shall survive the resignation, replacement or removal of
the Escrow Agent or the termination of this Agreement.

(b) The Parties hereby grant the Escrow Agent a lien on, right of set-off against and security
interest in, the Fund for the payment of any claim for indemnification, fees, expenses and amounts
due to the Escrow Agent or an Indemnitee. In furtherance of the foregoing, the Escrow Agent is
expressly authorized and directed, but shall not be obligated, to charge against and withdraw from
the Fund for its own account or for the account of an Indemnitee any amounts due to the Escrow
Agent or to an Indemnitee under either Sections 6(a), 7 or 8(a) of this Agreement.

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9.     Patriot Act Disclosure/Taxpayer Identification Numbers/Tax Reporting.

(a) Patriot Act Disclosure. Section 326 of the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (“USA PATRIOT Act”)
requires the Escrow Agent to implement reasonable procedures to verify the identity of any person
that opens a new account with it. Accordingly, the Parties acknowledge that Section 326 of the USA
PATRIOT Act and the Escrow Agent’s identity verification procedures require the Escrow Agent to
obtain information which may be used to confirm the Parties identity including without limitation
name, address and organizational documents (“identifying information”). The Parties agree to
provide the Escrow Agent with and consent to the Escrow Agent obtaining from third parties any such
identifying information required as a condition of opening an account with or using any service
provided by the Escrow Agent.

(b) Certification and Tax Reporting. The Parties have provided the Escrow Agent with their
respective fully executed Internal Revenue Service (“IRS”) Form W-8, or W-9 and/or other required
documentation. All income earned under this Agreement, if any, shall be allocated to the Company
and reported, as and to the extent required by law, by the Escrow Agent to the IRS, or any other
taxing authority, on IRS Form 1099 or 1042S (or other appropriate form) as income earned from the
Escrow Deposit by the Company whether or not said income has been distributed during such year.
Escrow Agent shall withhold any taxes it deems appropriate in the absence of proper tax
documentation or as required by law, and shall remit such taxes to the appropriate authorities.
The Parties hereby represent to the Escrow Agent that (i) there is no sale or transfer of an United
States Real Property Interest as defined under IRC Section 897(c) in the underlying transaction
giving rise to this Agreement; and (ii) such underlying transaction does not constitute an
installment sale requiring tax reporting or withholding of imputed interest or original issue
discount to the IRS or other taxing authority.

10.     Notices. All communications hereunder shall be in writing and except for
communications from the Parties setting forth, claiming, containing, objecting to, or in any way
related to the transfer or distribution of funds, including but not limited to funds transfer
instructions (all of which shall be specifically governed by Section 11 below), shall be deemed to
be duly given after it has been received and the receiving party has had a reasonable time to act
upon such communication if it is sent or served:

     (a) by facsimile;

     (b) by overnight courier; or

     (c) by prepaid registered mail, return receipt requested;

to the appropriate notice address set forth below or at such other address as any party hereto may
have furnished to the other parties in writing by registered mail, return receipt requested.

	 	 	 
	If to the Company

	 	XStream Systems, Inc.
	 

	 	10305 102nd Terrace, Suite 101
	 

	 	Sebastian, FL 32958
	 

	 	Attention: Dennis K. Cummings, Chief Financial Officer
	 

	 	Tel. No.: (772) 646-6208
	 

	 	Fax No.: (772) 589-4622
	 
	 	 
	With copies to

	 	Greenberg Traurig, P.A.
	 

	 	5100 Town Center Circle, Suite 400
	 

	 	Boca Raton, FL 33486
	 

	 	Attention: Bruce C. Rosetto, Esq.
	 

	 	Tel. No.: (561) 955-7625
	 

	 	Fax No.: (561) 367-6225

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	If to Underwriter

	 	W.R. Hambrecht + Co., LLC
	 

	 	Pier 1, Bay 3
	 

	 	San Francisco, CA 94111
	 

	 	Attention: Peter Morrissey Esq.
	 

	 	Tel No.:
	 

	 	Fax No.:
	 
	 	 
	With copies to

	 	Katten Muchin Rosenman LLP
	 

	 	575 Madison Avenue
	 

	 	New York, NY 10022
	 

	 	Attention: David A. Pentlow, Esq.
	 

	 	Tel. No.: (212) 940-6412
	 

	 	Fax No.: (212) 894-5912
	 
	 	 
	If to the Escrow Agent

	 	JPMorgan Chase Bank, N.A.
	 

	 	Escrow Services
	 

	 	4 New York Plaza, 21st Floor
	 

	 	New York, N.Y. 10004
	 

	 	Attention: Greg Kupchynsky
	 

	 	Fax No. (212) 623.6168
	 

	 	Phone: (212) 623.6812

Notwithstanding the above, in the case of communications delivered to the Escrow Agent, such
communications shall be deemed to have been given on the date received by an officer of the Escrow
Agent or any employee of the Escrow Agent who reports directly to any such officer at the
above-referenced office. In the event that the Escrow Agent, in its sole discretion, shall
determine that an emergency exists, the Escrow Agent may use such other means of communication as
the Escrow Agent deems appropriate. For purposes of this Agreement, “Business Day” shall mean any
day other than a Saturday, Sunday or any other day on which the Escrow Agent located at the notice
address set forth above is authorized or required by law or executive order to remain closed.

11.     Security Procedures. Notwithstanding anything to the contrary as set forth in Section
10, any instructions setting forth, claiming, containing, objecting to, or in any way related to
the transfer or distribution of funds, including but not limited to any such funds transfer
instructions that may otherwise be set forth in a written instruction permitted pursuant to Section
4 of this Agreement, may be given to the Escrow Agent only by confirmed facsimile and no
instruction for or related to the transfer or distribution of the Fund, or any portion thereof,
shall be deemed delivered and effective unless the Escrow Agent actually shall have received such
instruction by facsimile at the number provided to the Parties by the Escrow Agent in accordance
with Section 10 and as further evidenced by a confirmed transmittal to that number.

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(a) In the event funds transfer instructions are so received by the Escrow Agent by facsimile, the
Escrow Agent is authorized to seek confirmation of such instructions by telephone call-back to the
person or persons designated on Schedule 1 hereto, and the Escrow Agent may rely upon the
confirmation of
anyone purporting to be the person or persons so designated. The persons and telephone numbers for
call-backs may be changed only in a writing actually received and acknowledged by the Escrow Agent.
If the Escrow Agent is unable to contact any of the authorized representatives identified in
Schedule 1, the Escrow Agent is hereby authorized both to receive written instructions from and
seek confirmation of such instructions by telephone call-back to any one or more of the Company or
Underwriter’s executive officers, (“Executive Officers”), as the case may be, which shall include
the titles of Co-Chief Executive Officer and Chief Financial Officer, as the Escrow Agent may
select. Such “Executive Officer” shall deliver to the Escrow Agent a fully executed incumbency
certificate, and the Escrow Agent may rely upon the confirmation of anyone purporting to be any
such officer. The Escrow Agent and the beneficiary’s bank in any funds transfer may rely solely
upon any account numbers or similar identifying numbers provided by the Company or Underwriter to
identify (i) the beneficiary, (ii) the beneficiary’s bank, or (iii) an intermediary bank. The
Escrow Agent may apply any of the Fund for any payment order it executes using any such identifying
number, even when its use may result in a person other than the beneficiary being paid, or the
transfer of funds to a bank other than the beneficiary’s bank or an intermediary bank designated.

(b) The Company acknowledges that the Escrow Agent is authorized to use the funds transfer
instructions on Schedule 3 hereto to disburse any funds due to the Company under this Agreement
without a verifying call-back as set forth in Section 11(a) above:

	 	 	 
	The Company’s Bank account information:

	 	[Bank name:
	 

	 	Bank Address:
	 

	 	ABA number:
	 

	 	Account name:
	 

	 	Account number:          ]
	 

	 	See Schedule 3

Underwriter acknowledges that the Escrow Agent is authorized to use the following funds transfer
instructions on Schedule 3 hereto to disburse any funds due to Underwriter under this Agreement
without a verifying call-back as set forth in Section 11(a) above:

	 	 	 
	Underwriter’s Bank account information:

	 	[Bank name:
	 

	 	Bank Address:
	 

	 	ABA number:
	 

	 	Account name:
	 

	 	Account number:          ]
	 

	 	See Schedule 3

(c) In addition to their respective funds transfer instructions as set forth in Section 11(b)
above, the Company acknowledges that repetitive funds transfer instructions may be given to the
Escrow Agent for one or more beneficiaries where only the date of the requested transfer, the
amount of funds to be transferred, and/or the description of the payment shall change within the
repetitive instructions (“Standing Settlement Instructions”). Accordingly, the Company shall
deliver to Escrow Agent such specific Standing Settlement Instructions only for each respective
beneficiary as set forth in Schedule 1, by facsimile in accordance with this Section 11. Escrow
Agent may rely solely upon such Standing Settlement Instructions and all identifying information
set forth therein for each beneficiary. Escrow Agent and the Company agree that such Standing
Settlement Instructions shall be effective as the funds transfer instructions of the Company,
without requiring a verifying callback, whether or not authorized, if
such Standing Settlement Instructions are consistent with previously authenticated Standing
Settlement Instructions for that beneficiary.

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(d) The Parties acknowledge that the security procedures set forth in this Section 11 are
commercially reasonable.

12.     Compliance with Court Orders. In the event that any escrow property shall be attached,
garnished or levied upon by any court order, or the delivery thereof shall be stayed or enjoined by
an order of a court, or any order, judgment or decree shall be made or entered by any court order
affecting the property deposited under this Agreement, the Escrow Agent is hereby expressly
authorized, in its sole discretion, to obey and comply with all writs, orders or decrees so entered
or issued, which it is advised by legal counsel of its own choosing is binding upon it, whether
with or without jurisdiction, and in the event that the Escrow Agent obeys or complies with any
such writ, order or decree it shall not be liable to any of the parties hereto or to any other
person, entity, firm or corporation, by reason of such compliance notwithstanding such writ, order
or decree be subsequently reversed, modified, annulled, set aside or vacated.

13.     Miscellaneous. Except for changes to funds transfer instructions as provided in
Section 11, the provisions of this Agreement may be waived, altered, amended or supplemented, in
whole or in part, only by a writing signed by the Escrow Agent and the Parties. Neither this
Agreement nor any right or interest hereunder may be assigned in whole or in part by the Escrow
Agent or any Party, except as provided in Section 6, without the prior consent of the Escrow Agent
and the other Parties.
Notwithstanding the preceding sentence, the Company shall have no assignable interest in or rights
to the Investor funds under this Agreement prior to release of the funds under Section 4.
This Agreement shall be governed by and construed under the laws of the
State of Florida. Each Party and the Escrow Agent irrevocably waives any objection on the grounds
of venue, forum non-conveniens or any similar grounds and irrevocably consents to service of
process by mail or in any other manner permitted by applicable law and consents to the jurisdiction
of the courts located in the State of Florida. To the extent that in any jurisdiction either Party
may now or hereafter be entitled to claim for itself or its assets, immunity from suit, execution
attachment (before or after judgment), or other legal process, such Party shall not claim, and it
hereby irrevocably waives, such immunity. The Escrow Agent and the Parties further hereby waive
any right to a trial by jury with respect to any lawsuit or judicial proceeding arising or relating
to this Agreement. No party to this Agreement is liable to any other party for losses due to, or
if it is unable to perform its obligations under the terms of this Agreement because of, acts of
God, fire, war, terrorism, floods, strikes, electrical outages, equipment or transmission failure,
or other causes reasonably beyond its control. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. All signatures of the parties to this Agreement may be transmitted by
facsimile, and such facsimile will, for all purposes, be deemed to be the original signature of
such party whose signature it reproduces, and will be binding upon such party. If any provision of
this Agreement is determined to be prohibited or unenforceable by reason of any applicable law of a
jurisdiction, then such provision shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining provisions thereof, and any
such prohibition or unenforceability in such jurisdiction shall not invalidate or render
unenforceable such provisions in any other jurisdiction. A person who is not a party to this
Agreement, including, but not limited to an Investor, shall have no right to instruct the Escrow
Agent. The Parties represent, warrant
and covenant that each document, notice, instruction or request provided by such Party to Escrow
Agent shall comply with applicable laws and regulations. Where, however, the conflicting
provisions of any such applicable law may be waived, they are hereby irrevocably waived by the
parties hereto to the fullest extent permitted by law, to the end that this Agreement shall be
enforced as written. Except as expressly provided in Section 8 above, nothing in this Agreement,
whether express or implied, shall be construed to

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give to any person or entity other than the Escrow Agent and the Parties any legal or equitable
right, remedy, interest or claim under or in respect of this Agreement or any funds escrowed
hereunder.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forth
above.

	 	 	 	 	 
	THE COMPANY: XSTREAM SYSTEMS, INC.

 	 
	By:  	 
 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 	 
	UNDERWRITER: W.R. HAMBRECHT + CO., LLC

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

	 	 	 	 	 
	JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

as Escrow Agent

 	 
	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 

9exv4w1

Exhibit 4.1

TENDER AND VOTING AGREEMENT

     THIS TENDER AND VOTING AGREEMENT (this “Agreement”), dated September 13, 2010, is by
and among Hewlett-Packard Company, a Delaware corporation (“Parent”), Priam Acquisition
Corporation, a Delaware corporation (“Merger Sub”), and certain stockholders of ArcSight,
Inc., a Delaware corporation (the “Company”), set forth on Schedule I hereto (each
a “Stockholder” and, collectively the “Stockholders”).

     WHEREAS, Parent, Merger Sub and the Company propose to enter into an Agreement and Plan of
Merger, dated as of the date hereof (the “Merger Agreement”), which provides, among other
things, for Merger Sub to commence a tender offer for all of the issued and outstanding Common
Stock (as defined below) of the Company (the “Offer”) and the merger of Merger Sub with and
into the Company, with the Company continuing as the surviving corporation (the “Merger”),
upon the terms and subject to the conditions set forth in the Merger Agreement (capitalized terms
used herein without definition shall have the respective meanings specified in the Merger
Agreement);

     WHEREAS, each Stockholder beneficially owns the number of shares of common stock, par value
$0.00001 per share, of the Company (the “Common Stock”) set forth opposite the name of such
Stockholder on Schedule I hereto (such shares of Common Stock, together with any other
shares of capital stock of the Company acquired (whether held beneficially or of record) by such
Stockholder after the date hereof and prior to the earlier of the Effective Time and the
termination of all of the Stockholder’s obligations under this Agreement, including any shares of
Common Stock acquired by means of purchase, dividend or distribution, or issued upon the exercise
of any warrants or options, or the conversion of any convertible securities or otherwise, being
collectively referred to herein as the “Shares”); and

     WHEREAS, as a condition to the willingness of Parent and Merger Sub to enter into the Merger
Agreement and as an inducement and in consideration therefor, the Stockholders have agreed to enter
into this Agreement.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set
forth herein and in the Merger Agreement, and intending to be legally bound hereby, the parties
hereto agree as follows:

     Section 1. Representations and Warranties of the Stockholders.
Each Stockholder hereby represents and warrants to Parent and Merger Sub, severally and not
jointly, and solely as to itself and its Shares, as follows:

          (a) The Stockholder (i) is the beneficial owner and has good and marketable title to, the
Shares set forth opposite such Stockholder’s name on Schedule I hereto, free and clear of
any and all liens, claims, security interests, proxies, voting trusts or agreements, options,
rights, understandings or arrangements or any other encumbrances whatsoever on title, transfer, or
exercise of any rights of a stockholder in respect of such Shares (collectively,
“Encumbrances”) except any Encumbrances arising under securities

 

 

laws or arising hereunder; (ii) does not own, of record or beneficially, any shares of capital
stock of the Company other than the Shares set forth on Schedule I hereto); and (iii) has
the right to vote and dispose of and holds power to issue instructions with respect to the matters
set forth in Sections 3, 4 and 5 hereof, power to demand appraisal rights
and power to agree to all of the matters set forth in this Agreement, in each case with respect to
all of such Stockholder’s Shares, with no material limitations, qualifications or restrictions on
such rights, subject to applicable federal securities law and the terms of this Agreement.

          (b) In the case of any Stockholder that is a corporation, limited partnership or limited
liability company, such Stockholder is an entity duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated or constituted.

          (c) The Stockholder has the legal capacity and all requisite power and authority to execute
and deliver this Agreement and to perform the Stockholder’s obligations hereunder and consummate
the transactions contemplated hereby. To the extent applicable, the execution, delivery and
performance by the Stockholder of this Agreement and the consummation by the Stockholder of the
transactions contemplated hereby have been duly and validly authorized by the Stockholder (or its
board of directors or similar governing body, as applicable), and no other actions or proceedings
on the part of the Stockholder are necessary to authorize the execution and delivery by the
Stockholder of this Agreement and the consummation by the Stockholder of the transactions
contemplated hereby. This Agreement has been duly and validly executed and delivered by the
Stockholder and constitutes a valid and binding obligation of the Stockholder enforceable in
accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting creditors’ rights
generally and general equitable principles (whether considered in a proceeding in equity or at
law).

          (d) Neither the execution and delivery of this Agreement by the Stockholder, the performance
by the Stockholder of such Stockholder’s obligations hereunder nor the consummation by the
Stockholder of the transactions contemplated hereby will (i) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default under, or conflict with (A)
to the extent applicable, any provisions of the organizational documents of the Stockholder or (B)
any contract, trust, commitment, agreement, understanding, arrangement or restriction of any kind
to which such Stockholder is a party or by which such Stockholder’s Shares are bound, or (ii)
subject to compliance with filing requirements as may be required under applicable securities laws,
violate, or require any consent, approval, or notice under, any provision of any judgment, order,
decree, statute, law, rule or regulation applicable to such Stockholder or any of such
Stockholder’s Shares.

     Section 2. Representations and Warranties of Parent and Merger Sub.
Each of Parent and Merger Sub hereby, jointly and severally, represents and warrants to the
Stockholders as follows:

2

 

          (a) Each of Parent and Merger Sub is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it is incorporated, and each of Parent
and Merger Sub has all requisite corporate power and corporate authority to execute and deliver
this Agreement and to perform its obligations hereunder and consummate the transactions
contemplated hereby, and has taken all necessary corporate action to authorize the execution,
delivery and performance of this Agreement.

          (b) This Agreement has been duly authorized, executed and delivered by each of Parent and
Merger Sub and constitutes a valid and binding obligation of Parent and Merger Sub enforceable in
accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting creditors’ rights
generally and general equitable principles (whether considered in a proceeding in equity or at
law).

          (c) Neither the execution and delivery of this Agreement by Parent and Merger Sub, the
performance by Parent and Merger Sub of their obligations hereunder nor the consummation by Parent
and Merger Sub of the transactions contemplated hereby will (i) result in a violation or breach of,
or constitute (with or without notice or lapse of time or both) a default under, or conflict with
(A) any provisions of the organizational documents of Parent or Merger Sub or (B) any contract,
trust, commitment, agreement, understanding, arrangement or restriction of any kind to which such
Parent or Merger Sub is a party or by which Parent or Merger Sub or their assets are bound, or (ii)
subject to compliance with filing requirements as may be required under applicable securities laws,
violate, or require any consent, approval, or notice under, any provision of any judgment, order,
decree, statute, law, rule or regulation applicable to Parent or Merger Sub or their assets.

     Section 3. Tender of the Shares.
Unless this Agreement shall have been terminated in accordance with its terms, and subject to
Section 4 hereof, each Stockholder hereby agrees that it shall (i) tender its Shares (and
deliver any certificates evidencing such Shares or an appropriate affidavit of lost certificate
with respect thereto to the extent any of such certificates have been lost, misplaced or
destroyed), or cause its Shares to be tendered, into the Offer promptly following the date hereof,
and in any event no later than five (5) business days prior to the Initial Expiration Date of the
Offer, free and clear of all Encumbrances and (ii) not withdraw its Shares, or cause its Shares to
be withdrawn, from the Offer at any time. If a Stockholder acquires Shares after the date hereof,
such Stockholder shall (A) tender or cause to be tendered such Shares on or before the fifth
(5th) business day prior to the Initial Expiration Date or, if later, on or before the
second business day after such acquisition but in any event prior to the Expiration Date, and (B)
not withdraw such Shares, or cause such Shares to be withdrawn, from the Offer at any time.

     Section 4. Transfer of the Shares; Other Actions.
Prior to the termination of this Agreement, except as otherwise provided herein (including
pursuant to Section 3 hereof), each Stockholder shall not: (i) transfer, assign, sell,
gift-over, pledge or otherwise dispose (whether by sale, merger, consolidation, liquidation,
dissolution, dividend, distribution or otherwise) of, or consent to any of the foregoing
(“Transfer”), any Shares or

3

 

any right or interest therein; (ii) enter into any Contract with respect to any Transfer of
Shares; (iii) grant any proxy or power-of-attorney with respect to any of the Shares in
contravention of the obligations of the Stockholder hereunder or the transactions contemplated
hereby; (iv) deposit any of the Shares into a voting trust, or enter into a voting agreement or
arrangement with respect to any of the Shares in contravention of the obligations of the
Stockholder hereunder or the transactions contemplated hereby; or (v) take any other action that
would restrict, limit or interfere in any material respect with the performance of such
Stockholder’s obligations hereunder or the transactions contemplated hereby. Notwithstanding the
foregoing, the preceding sentence shall not prohibit a Transfer of Shares by Stockholder: (A) if
Stockholder is an individual, (1) to any member of Stockholder’s immediate family, (2) to a trust
established for the benefit of Stockholder and/or for the benefit of one or more members of
Stockholder’s immediate family or established for charitable purposes, or upon the death of
Stockholder, (3) to charitable organizations, (4) by selling already-owned Shares pursuant to
existing 10b5-1 trading plans or (5) for the purpose of personal tax-planning, or (B) if
Stockholder is a partnership, limited liability company or trust, to one or more partners or
members of Stockholder or to an affiliated corporation under common control with Stockholder or to
any trustee or beneficiary of the trust, provided that any Transfer permitted pursuant to (A) or
(B) above shall be permitted only if, as a precondition to such transfer, the transferee of such
Shares agrees in writing with Parent to be bound by the terms and conditions of this Agreement (a
“Permitted Transfer”).

     Section 5. Covenant to Vote.
Prior to termination of this Agreement in accordance with its terms, each Stockholder hereby
agrees to vote (or cause to be voted) all Shares beneficially owned by such Stockholder (the
“Vote Shares”), or to provide (or cause to be provided) a written consent in respect of the
Vote Shares, in connection with any meeting of the stockholders of the Company or any action by
written consent in lieu of a meeting of stockholders of the Company (i) in favor of the adoption of
the Merger Agreement) and/or (ii) against any action or agreement which would materially impede,
delay or interfere with, or prevent or nullify, the Merger, including, but not limited to, any
other extraordinary corporate transaction, including, a merger, acquisition, sale, consolidation,
reorganization or liquidation involving the Company and a third party, or any other Acquisition
Transaction proposed by a third party. In the event that a meeting of the stockholders of the
Company is held, each Stockholder shall, or shall cause the holder of record on any applicable
record date to, appear at such meeting, in person or by proxy, or otherwise cause the applicable
Vote Shares to be counted as present thereat for purposes of establishing a quorum.

     Section 6. Directors and Officers.
Notwithstanding any provision of this Agreement to the contrary, nothing herein shall be
construed as preventing a Stockholder, or a director, officer or employee of a Stockholder or
Affiliate of a Stockholder, who is an officer or director of the Company from fulfilling the
obligations of such office (including taking such actions in Stockholder’s capacity as an officer
or director as such officer or director, acting in such capacity, in good faith determines that the
failure to take such actions would reasonably be expected to result in a breach of the fiduciary
duties of such officer or director to the Company Stockholders, acting solely in his or her
capacity as an officer or director of the Company). In no event shall this Agreement be deemed to
be an

4

 

agreement of Stockholder in their capacity as a director or officer of the Company, as
applicable.

     Section 7. Further Assurances.
Each Stockholder shall, upon request of Parent or Merger Sub, execute and deliver any
additional documents and take such further actions as may reasonably be deemed by Parent or Merger
Sub to be necessary or desirable to carry out the express provisions of this Agreement.

     Section 8. Termination.
This Agreement, and all rights and obligations of the parties hereunder shall terminate on the
earlier of: (a) the date the Merger Agreement is validly terminated in accordance with its terms,
(b) the written agreement of the parties hereto to terminate this Agreement, (c) the Effective Time
and (d) with respect to any Stockholder, such date and time as any amendment or change to the
Merger Agreement or the Offer that decreases the Offer Price is effected. Termination of this
Agreement shall not relieve any party from liability for any willful breach hereof prior to such
termination. Sections 10 and 13 hereof shall survive any termination of this
Agreement.

     Section 9. Waiver of Appraisal and Dissenter’s Rights.
Each Stockholder waives and agrees not to exercise any rights of appraisal, rights to dissent
or similar rights with respect to the Merger or other transactions contemplated by the Merger
Agreement that the Stockholder may have with respect to the Stockholder’s Shares pursuant to
applicable law.

     Section 10. Expenses.
All fees, costs and expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such fees, costs and expenses.

     Section 11. Stop Transfer Order.
In furtherance of this Agreement, concurrently herewith, each Stockholder shall, and hereby
does authorize the Company or its counsel to, notify the Company’s transfer agent that there is a
stop transfer order with respect to all of the Shares of such Stockholder, other than Permitted
Transfers (and that this Agreement places limits on the voting and transfer of such Shares).

     Section 12. Disclosure.
Subject to reasonable prior notice, each Stockholder shall permit and hereby authorizes Parent
and Merger Sub to publish and disclose in all documents and schedules required to be filed with the
Securities and Exchange Commission, and any press release or other disclosure document that Parent
or Merger Sub reasonably determines to be necessary or desirable in connection with the Merger and
any transactions related to the Merger, such Stockholder’s identity and ownership of Shares and the
nature of such Stockholder’s commitments, arrangements and understandings under this Agreement;
provided, that, Parent shall provide the Stockholder, the Company and the Company’s counsel a
reasonable opportunity to review and comment on such disclosure.

     Section 13. Miscellaneous.

          (a) Notices.
All notices and other communications hereunder shall be in writing and shall be deemed given
if delivered and received hereunder (i) immediately

5

 

upon delivery personally, (ii) four Business Days after being sent by registered or certified
mail, return receipt requested, postage prepaid, (iii) one Business Day after being sent for next
Business Day delivery, fees prepaid, via a reputable nationwide overnight commercial delivery
service, or (iv) immediately if sent via telecopy (with electronic receipt confirmed), in case to
the parties at the following addresses or telecopy numbers (or at such other address or telecopy
numbers for a party as shall be specified by like notice).

     If to any of the Stockholders, to the address set forth below the name of such Stockholder on
Schedule I hereto:

with copies (which shall not constitute notice) to:

ArcSight, Inc.

5 Results Way

Cupertino, California 95014

Attention: Trâm T. Phi, Vice President and General Counsel

Telecopy No.: 408-532-5458

and

Fenwick & West LLP

801 California Street

Mountain View, California 94041

Attention: David A. Bell

Telecopy No.: 650-938-5200

and

Fenwick & West LLP

555 California Street, 12th Floor

San Francisco, California 94104

Attention: Douglas N. Cogen

Telecopy No.: 415-281-1350

If to Parent or Merger Sub, to:

Hewlett-Packard Company

3000 Hanover Street

Palo Alto, California 94304

Attention: General Counsel

Telecopy No.: 650-857-4837

6

 

with a copy (which shall not constitute notice) to:

Gibson, Dunn & Crutcher LLP

1881 Page Mill Road

Palo Alto, California 94304

Attention: Russell C. Hansen

Telecopy No.: 650-849-5333

          (b) Headings. The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this Agreement.

          (c) Counterparts. This Agreement may be executed manually or by facsimile by the
parties hereto in any number of counterparts, each of which shall be considered one and the same
agreement. This Agreement shall become effective with respect to a Stockholder when a counterpart
hereof shall have been signed by each of Parent, Merger Sub and such Stockholder and delivered to
the other such parties.

          (d) Entire Agreement. This Agreement (together with the Merger Agreement and any
other documents and instruments referred to herein and therein) constitutes the entire agreement
among the parties with respect to the subject matter hereof and thereof and supersedes all other
prior agreements and understandings, both written and oral, among the parties or any of them with
respect to the subject matter hereof and thereof. This Agreement is not intended and does not
confer upon any Person other than the parties hereto any rights hereunder.

          (e) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware, regardless of the laws that might otherwise govern under
applicable principles of conflicts of law thereof.

          (f) Consent to Jurisdiction. Each of the parties hereto irrevocably consents to the
exclusive jurisdiction of any state court located within New Castle County, State of Delaware in
connection with any matter based upon or arising out of this Agreement or any of the Agreements
delivered in connection herewith, or the transactions contemplated hereby or thereby, agrees that
process may be served upon them in any manner authorized by the laws of the State of Delaware for
such persons and waives and covenants not to assert or plead any objection which they might
otherwise have to such jurisdiction and process. Each party hereto hereby agrees not to commence
any legal proceedings relating to or arising out of this Agreement or any of the Agreements
delivered in connection herewith or the transactions contemplated hereby or thereby (including the
Offer and the Merger) in any jurisdiction or courts other than as provided herein.

          (g) WAIVER OF JURY TRIAL. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE AGREEMENTS DELIVERED IN CONNECTION
HEREWITH, OR THE

7

 

ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.

          (h) Assignment. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law
or otherwise) without the prior written consent of the other parties except that Parent and Merger
Sub may assign, in their sole discretion and without the consent of any other party, any or all of
their rights, interests and obligations hereunder to each other or to one or more direct or
indirect wholly-owned subsidiaries of Parent (each, an “Assignee”). Subject to the
preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable
by, the parties and their respective successors and assigns, and the provisions of this Agreement
are not intended to confer upon any person other than the parties hereto any rights or remedies
hereunder.

          (i) Severability of Provisions. If any term or provision of this Agreement is
invalid, illegal or incapable of being enforced by rule of law or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full force and effect so
long as the economic or legal substance of the transactions contemplated by this Agreement is not
affected in any manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the parties as closely
as possible in an acceptable manner to the end that the transactions are fulfilled to the extent
possible.

          (j) Specific Performance. The parties hereto acknowledge that money damages would be
an inadequate remedy for any breach of this Agreement by any party hereto, and that the obligations
of the parties hereto shall be enforceable by any party hereto through injunctive or other
equitable relief without any requirement to post a bond.

          (k) Amendment. No amendment, modification or waiver in respect of this Agreement
shall be effective against any party unless it shall be in writing and signed by such party.

          (l) Binding Nature. This Agreement is binding upon and is solely for the benefit of
the parties hereto and their respective successors, legal representatives and assigns.

          (m) Option Exercises. Nothing in this Agreement shall require a Stockholder to
exercise any option or warrant to purchase shares of Common Stock of the Company.

[Remainder of Page Intentionally Left Blank]

8

 

     IN WITNESS WHEREOF, Parent, Merger Sub and the Stockholders have caused this Agreement to be
duly executed and delivered as of the date first written above.

	 	 	 	 	 
	 	HEWLETT-PACKARD COMPANY

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	PRIAM ACQUISITION CORPORATION

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 

[TENDER AND VOTING AGREEMENT]

 

     IN WITNESS WHEREOF, Parent, Merger Sub and the Stockholders have caused this Agreement to be
duly executed and delivered as of the date first written above.

	 	 	 	 	 
	 	[ENTITY STOCKHOLDER NAME]

 	 
	 	By:  	 	 
	 
	 	Name:  	 	 
	 
	 	Title:  	 	 
	 
	 
	 	[INDIVIDUAL STOCKHOLDER NAME]
 	 

[TENDER AND VOTING AGREEMENT]

 

 

SCHEDULE I

	 	 	 	 	 
	Name and Address	 	Shares

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