FIS 0563 (5/04) Office of Financial and Insurance Services (replaces form C&S 8426) SECURITIES ESCROW AGREEMENT (SCOR) This Escrow Agreement is made and entered into this day of , by and between , a corporation, hereinafter referred to as "The Issuer", and , hereinafter referred to as the "Escrow Agent" and , security holder of the above Issuer, hereinafter referred to as "Security Holder". WHEREAS, a Registration statement, pursuant to Act 265 of the Public Act of 1964, as amended, has been filed with the Office of Financial and Insurance Services, Mich igan Department of Consumer & Industry Services seeking effective registration under the law of the of fering and sale of the following securities of the Issuer. Title of Each Class of Securities to be Proposed Maximum Proposed Maximum Amount to be Registered Registered Offering Price per Unit Aggregate Offering Price AND WHEREAS, one of the requirements of the Department for registration of the above securities is that certain securities be deposited in escrow. NOW, THEREFORE, in compliance with the above mentioned requirement and in con sideration of the mutual promises, agreements, and undertakings herein outlined, the f ollowing conditions (the "Conditions") by and between the parties are agreed to as follows: (1) Security Holder shall deposit with the Escrow Agent the following securities of which he is the sole owner beneficially and of record: Certificate numbered representing shares of common stock of the Issuer. (2) The securities while in escrow: (a) Will not share in assets in dissolution or liquidation until and unless the remaining Security Holders have been paid a liquidating dividend equal to the public offering price. (b) Will not be assigned, sold, transferred, or disposed of except by will or pursuant to the laws of descent and distribution either in whole or in part and in the case of every such transfer, the transferee shall execute an escrow agreement identical to this agreement and shall redeposit the securities in escrow under the same terms. Authorized under Act 265, PA 1964, as amended. This form may be required as a condition to effectiveness of registration. Page 1 American LegalNet, Inc. www.USCourtForms.com>>>> 2 (c) Shall not share in any cash dividend or distribution unless the s ame is paid out of earned surplus and in furtherance hereof, the Security Holder agrees to donate into the treasury of the Issuer any such dividend or distribution not paid out of earned surp lus; this condition shall no longer apply if and when all other security holders have receiv ed a liquidating dividend equal per share to the offering price of the securities registered as noted above. (d) May participate in a stock dividend but in that event the Securit y Holder agrees forthwith to deposit any share so received in escrow upon the same terms as herein se t forth. (e) Upon the exercise by any Security Holder of his or her conversion rights, warrants or options to acquire additional securities of the Issuer, the additional securities received from the exercise of such warrants or options shall be deposited in escrow with the Escrow Agent, and shall be subject to the terms and conditions of this Agreement. (f) May be canceled, transferred or released from escrow by the Mic higan Office of Financial and Insurance Services in whole or in part. None of said securities sha ll be canceled without the consent of the Security Holder. (3) The Escrow Agent shall release to the Security Holder these securi ties uncanceled upon any of the following events: (a) The Issuer has earned an average annual net income per share acco rding to generally accepted accounting principals of 6%, or greater, of the public offering price (based on the average number of shares outstanding during the period as determined by an audit made by an independent certified public accountant) on the class of securities held in escrow for a two year period beginning after the completion of the public offering. (b) The market price of the class of securities held in escrow, as determined from the quotations issued on such class of securities in the NASDAQ System, remains above t he greater of the public offering price or $5.00 per share over any period of six consecutive month s beginning at least six months after the completion of the public offering. (c) The passage of three years from the date on which the public offering is completed. (d) Receipt of the order of the Michigan Office of Financial and Insu rance Services ordering that the securities be released from escrow. Such order may be issued by the Office upon a showing by the Issuer or Security Holder that equity demands such releas e. (4) The Issuer shall furnish or cause to be furnished to the Division of Sec urities of the Office of Financial and Insurance Services copies of all executed securities escro w agreements. (5) The Escrow Agent shall keep a record, simultaneously with the rece ipt of each such deposit of securities, of the names and addresses of each Security Holder and the a mount of their respective interest. (6) A written request for termination of the escrow, based on the satisfaction of either paragraph Page 2 American LegalNet, Inc. www.USCourtForms.com>>>> 3 (3)(a) or (3)(b) above, shall be forwarded to the Office. A request for termination of the escrow based upon paragraph (3)(a) shall be accompanied by an earnings per share calculation audited and reported on by an independent certified public accountant. If the p rovision of either (3)(a) or (3)(b) is satisfied, the Administrator shall direct the Escrow Agent to release the Securities to the Security Holder. (7) The foregoing notwithstanding, the Securities shall be released b y the Escrow Agent: (a) If the public offering has been terminated and no securities were sold, or, (b) If a public best efforts minimum-maximum offering is terminated without sale of minimum offering and all proceeds have been returned to investors in such offering. (8) Upon making delivery to the Security Holder of the securities hel d in escrow pursuant to paragraph (3) above of this Agreement, the Escrow Agent shall be released from any further liability, it being expressly understood that liability is limited by the terms and provisio ns set forth herein and that by acceptance of this Agreement, Escrow Agent is acting in the capacity of a depository, and is not as such responsible or li