CLOSING ESCROW AGREEMENT
Exhibit
10.3
THIS
CLOSING ESCROW AGREEMENT,
dated
May 14, 2007 (“Escrow
Agreement”),
is
entered into by and between Intra-Asia Entertainment Corporation, a Nevada
corporation (the "Company"),
the
selling stockholders identified on the signature pages hereto (each a
“Selling
Stockholder” and
collectively, the “Selling
Stockholders”),
Antaeus Capital, Inc. (the “Placement
Agent”)
and
Xxxxxx Xxxx Xxxxx Raysman & Xxxxxxx LLP (the "Escrow
Agent").
WHEREAS,
concurrently herewith the Company, the Selling Stockholders and Investors
are
entering into a Securities Purchase Agreement, dated as of the date hereof
(the
"Purchase
Agreement"),
pursuant to which each Investor (as defined therein) has agreed to purchase
from
the Company, and the Company has agreed to sell to each Investor, the number
of
Shares and each Investor has agreed to purchase from the Selling Stockholders,
and the Selling Stockholders have agreed to sell to each Investor, the
number of
Selling Stockholder Shares identified therein (capitalized terms used and
not
otherwise defined herein shall have the meanings given such terms in the
Purchase Agreement);
WHEREAS, pursuant
to the Purchase Agreement, the Company, the Selling Stockholders and the
Investors have agreed to establish an escrow on the terms and conditions
set
forth in this Escrow Agreement; and
WHEREAS,
the
Escrow Agent is willing to accept appointment as Escrow Agent for only
the
expressed duties outlined herein.
NOW,
THEREFORE,
in
consideration of the premises set forth above and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties
hereto
agree as follows:
1.
Proceeds to be Escrowed. A
copy of
the Purchase Agreement is attached as Exhibit
A.
All
amounts provided by the Investors in connection with their acquisition
of the
Securities as set forth in the Purchase Agreement shall be deposited directly
with the Escrow Agent in immediately available funds by federal wire transfer,
such funds being referred to herein as the “Escrow
Funds.”
The
Escrow Funds shall be retained in escrow by the Escrow Agent in a separate
account and invested as stated below.
2.
Identity of Investors. Concurrent
with the execution of the Escrow Agreement, the Company shall furnish to
the
Escrow Agent the information comprising the identity of the Investors in
the
format set forth in the “List
of Investors”
attached as Exhibit
B,
or in
an electronic spreadsheet format with the same information. All Escrow
Funds
shall remain the property of the Investors and shall not be subject to
any liens
or charges by the Company or the Escrow Agent or judgments or creditors'
claims
against the Company, until released to the Company as hereinafter provided.
Escrow Agent will not use the information provided to it by the Company
for any
purpose other than to fulfill its obligations as Escrow Agent. The Company
and
the Escrow Agent will treat all Investor information as
confidential.
3.
Disbursement of Funds.
(a) The
Escrow Agent shall continue to hold the Escrow Funds delivered for deposit
hereunder by an Investor until the earlier of: (1) receipt of a joint written
notice from the Company and the Investors evidencing termination under
Section
6.5(a) of the Purchase Agreement, (2) receipt of a written notice from
the
Company, a Selling Stockholder or such Investor evidencing termination
under
Section 6.5(b) of the Purchase Agreement (each of (1) and (2), a “Termination
Election”)
and
(3) receipt of both (x) written notice from the Company that the conditions
to
closing under Section 5.1 of the Purchase Agreement have been satisfied
or
waived in accordance with the Purchase Agreement and (y) joint written
notice
from the Company and the Placement Agent to effect the Closing.
(b) If
the
Escrow Agent receives a Termination Election prior to its receipt of the
notices
contemplated under Section 3(a)(3), then the Escrow Agent shall return
the
Escrow Funds delivered by such Investor as directed by such Investor. If
the
Escrow Agent receives the notices contemplated under Section 3(a)(3) prior
to a
Termination Election, then the Escrow Agent shall disburse the Escrow Funds
in
accordance with Exhibit
C
to this
Escrow Agreement.
4.
Duty and Limitation on Liability of the Escrow Agent. The
sole
duty of the Escrow Agent shall be to receive the Escrow Funds and to hold
them
subject to release, in accordance herewith, and the Escrow Agent shall
be under
no duty to determine whether the Company is complying with requirements
of the
Escrow Agreement or the Purchase Agreement. The Escrow Agent may conclusively
rely upon and shall be protected in acting upon any statement, certificate,
notice, request, consent, order or other document believed by it to be
genuine
and to have been signed or presented by the proper party or parties. The
Escrow
Agent shall have no duty or liability to verify any such statement, certificate,
notice, request, consent, order or other document, and its sole responsibility
shall be to act only as expressly set forth in the Escrow Agreement. The
Escrow
Agent shall be under no obligation to institute or defend any action, suit
or
proceeding in connection with the Escrow Agreement unless first indemnified
to
its satisfaction. The Escrow Agent may consult counsel of its own choice
with
respect to any question arising under the Escrow Agreement and the Escrow
Agent
shall not be liable for any action taken or omitted in good faith upon
advice of
such counsel. In
the
event that the Escrow Agent shall be uncertain as to its duties or rights
hereunder or shall receive instructions with respect to the Escrow Funds
which,
in its sole opinion, are in conflict with either other instructions received
by
it or any provision of this Escrow Agreement, or if the Escrow Agent has
not
been provided with instructions regarding the Escrowed Funds, it shall
be
entitled to hold the Escrow Funds pending the resolution of such uncertainty
to
the Escrow Agent's sole satisfaction, final judgment of a court or courts
of
competent jurisdiction, or otherwise.
In
no
event shall the Escrow Agent be liable, directly or indirectly, for any
(a)
damages or expenses arising out of the services provided hereunder, other
than
damages which result from the Escrow Agent’s gross negligence or willful
misconduct or (b) special or consequential damages, even if the Escrow
Agent has
been advised of the possibility of such damages.
The
Escrow Agent shall be obligated only to perform the duties specifically
set
forth in this Escrow Agreement, which shall be deemed purely ministerial
in
nature, and shall under no circumstances be deemed to be a fiduciary to
the
Company, the Placement Agent or any other person. The Escrow Agent shall
not
assume any responsibility for the failure of the Company to perform in
accordance with this Escrow Agreement. This Escrow Agreement sets forth
all
matters pertinent to the escrow contemplated hereunder, and no additional
obligations of the Escrow Agent shall be implied by nor inferred from the
terms
of any other agreement, including, without limitation, the Purchase
Agreement.
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Under
no
circumstances shall the Escrow Agent be expected or required to use, risk
or
advance its own funds in the performance of its duties or exercise of its
rights
hereunder.
The
Investors (by agreeing to use this form of Closing Escrow Agreement), the
Selling Stockholders and the Placement Agent acknowledge that they are
aware
that the Escrow Agent has represented the Company in connection with the
Purchase Agreement and this Escrow Agreement and that Escrow Agent may
continue
to represent the Company in that connection and in connection with the
transactions contemplated by those agreements, including, but not limited
to, in
connection with any disputes that may arise under either of those agreements.
The Escrow Agent shall not be precluded from or restricted from representing
the
Company or any of its affiliates or otherwise acting as attorneys for the
Company or any of its affiliates in any matter, including, but not limited
to,
any court proceeding or other matter related to the Purchase Agreement
or the
transactions contemplated by the Purchase Agreement, or this Escrow Agreement
or
the Escrow Funds, whether or not there is a dispute between the Investors,
the
Selling Stockholders, the Placement Agent and/or the Company with respect
to any
such matter.
5.
Interpleader.
The
Escrow Agent may at any time commence an action in the nature of interpleader
or
other legal proceedings and may deposit the Escrow Funds with the clerk
of the
court. In the event of any dispute regarding who is entitled to the Escrow
Funds
at any time, the Escrow Agent may determine not to release the Escrow Funds
to
any Investor, the Company or a Selling Stockholder (as the case may be)
and may
commence an interpleader action as aforesaid or may cause the Escrow Funds
to be
deposited with a court of competent jurisdiction whereupon it shall cease
to
have any further obligation hereunder. Upon any delivery or deposit of
the
Escrow Funds as provided in this Section 5, the Escrow Agent shall be released
and discharged from any further obligation under this Agreement.
6.
Investment of Proceeds. The
Escrow Funds shall be credited by Escrow Agent and recorded in a non-interest
bearing escrow account. The
Company agrees to indemnify and hold Escrow Agent harmless from and against
any
taxes, additions for late payment, interest, penalties and other expenses
that
may be assessed against Escrow Agent on or with respect to any payment
or other
activities under this Escrow Agreement unless any such tax, addition for
late
payment, interest, penalties and other expenses shall arise out of or be
caused
by the gross negligence or willful misconduct of the Escrow Agent.
The
Company acknowledges that Escrow Agent is not providing investment supervision,
recommendations or advice.
7.
Notices. All
notices, requests, demands and other communications under the Escrow Agreement
shall be in writing and shall be deemed to have been duly given (a) on
the date
of service if served personally on the party to whom notice is to be given,
(b)
on the day of transmission if sent by facsimile/email transmission to the
facsimile number/email address given below, and telephonic confirmation
of
receipt is obtained promptly after completion of transmission, (c) on the
day
after delivery to Federal Express or similar overnight courier or the Express
Mail service maintained by the United States Postal Service or (d) on the
fifth
day after mailing, if mailed to the party to whom notice is to be given,
by
first class mail, registered or certified, postage prepaid, and properly
addressed, return receipt requested, to the party as follows:
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If
to the Company:
|
Intra-Asia
Entertainment Corporation
|
|
Xx.
000 Xxxxxxxxx, Xxxxxxx Xxxxxxxx
|
|
|
|
Xxxxxxx,
Xxxxx 100086
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Facsimile:
00-00-00000000
|
|
|
Attn.:
Chairman
|
|
|
If
to Escrow Agent:
|
Xxxxxx
Xxxx Xxxxx Raysman & Xxxxxxx LLP
|
|
000
Xxxxxx Xxxxxx, XX
|
|
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Xxxxxxxxxx,
XX 00000
|
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Facsimile:
000-000-0000
|
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Attn.:
Xxxxx X. Xxxxxxxxxx, Esq.
|
|
|
If
to the Placement Agent:
|
Antaeus
Capital, Inc.
|
|
0000
X. Xxxxx Xxxxxx Xxxx.
|
|
|
Xxxxx
000
|
|
|
Xxxxxxx
Xxxxx, XX 00000
|
|
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Facsimile:
(000) 000-0000
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|
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Attn.:
Xxxxx Xxxx
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|
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If
to a Selling:
Stockholder
|
To
the address set forth on its signature page
hereto.
|
Any
party
may change its address for purposes of this paragraph by giving the other
party
written notice of the new address in the manner set forth above.
8.
Indemnification of Escrow Agent. The
Company hereby indemnifies and holds harmless the Escrow Agent from and
against
any and all loss, liability, cost, damage and expense, including, without
limitation, attorneys fees and court costs, which the Escrow Agent may
suffer or
incur by reason of any action, claim or proceeding brought against the
Escrow
Agent arising out of or relating in any way to the Escrow Agreement or
any
transaction to which the Escrow Agreement relates unless such action, claim
or
proceeding is the result of the willful misconduct or gross negligence
of the
Escrow Agent. For this purpose, the term "attorneys' fees" includes fees
payable
to any counsel retained by the Escrow Agent in connection with its services
under this Agreement and, with respect to any matter arising under this
Escrow
Agreement as to which the Escrow Agent performs legal services, if and
to the
extent that the Escrow Agent itself is a law firm, its standard hourly
rates and
charges then in effect. All of the Escrow Agent's rights of indemnification
provided for in this Escrow Agreement shall survive the resignation of
the
Escrow Agent, its replacement by a successor Escrow Agent, its delivery
or
deposit of the Escrow Funds in accordance with this Escrow Agreement, the
termination of this Escrow Agreement, and any other event that occurs after
this
date.
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9.
Successors and Assigns. Except
as
otherwise provided in the Escrow Agreement, no party hereto shall assign
the
Escrow Agreement or any rights or obligations hereunder without the prior
written consent of the other parties hereto and each Investor and any such
attempted assignment without such prior written consent shall be void and
of no
force and effect. The Escrow Agreement shall inure to the benefit of and
shall
be binding upon the successors and permitted assigns of the parties
hereto.
10.
Governing Law; Jurisdiction. The
Escrow Agreement shall be construed, performed and enforced in accordance
with,
and governed by the internal laws of the State of New York, without giving
effect to the principles of conflicts of laws thereof.
11.
Severability. In
the
event that any part of the Escrow Agreement is declared by any court or
other
judicial or administrative body to be null, void, or unenforceable, said
provision shall survive to the extent it is not so declared, and all of
the
other provisions of the Escrow Agreement shall remain in full force and
effect.
12.
Amendments; Waivers. The
Escrow Agreement may be amended or modified, and any of the terms, covenants,
representations, warranties or conditions hereof may be waived, only by
a
written instrument executed by each of the parties hereto and the Investors
then
owning a majority of the Securities then held by Investors. Any waiver
by any
party of any condition or of the breach of any provision, term, covenant,
representation or warranty contained in the Escrow Agreement, in any one
or more
instances, shall not be deemed to be nor construed as further or continuing
waiver of any such condition, or of the breach of any other provision,
term,
covenant, representation or warranty of the Escrow Agreement.
13.
Entire Agreement. The
Escrow Agreement contains the entire understanding among the parties hereto
with
respect to the escrow contemplated hereby and supersedes and replaces all
prior
and contemporaneous agreements and understandings, oral or written, with
regard
to such escrow.
14.
Section Headings. The
section headings in the Escrow Agreement are for reference purposes only
and
shall not affect the meaning or interpretation of the Escrow
Agreement.
15.
Counterparts. The
Escrow Agreement may be executed in facsimile and in any number of counterparts,
each of which when so executed and delivered shall be deemed an original,
but
all of which shall together constitute one and the same agreement.
16.
Resignation. Escrow
Agent may resign upon 15 days advance written notice to the Company. If
a
successor escrow agent is not appointed within the 15-day period following
such
notice, Escrow Agent may petition any court of competent jurisdiction to
name a
successor escrow agent or interplead the Escrow Funds with such court,
whereupon
Escrow Agent’s duties hereunder shall terminate.
17.
Third-Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto and their respective
successors and permitted assigns and is not for the benefit of, nor may
any
provision hereof be enforced by, any other person or entity, except for
the
Investors.
5
IN
WITNESS WHEREOF,
the
parties hereto have caused the Escrow Agreement to be executed the day
and year
first set forth above.
INTRA-ASIA
ENTERTAINMENT CORPORATION
By:
/s/
Name:
Title:
ANTAEUS
CAPITAL, INC.
By:
/s/
Name:
Title:
XXXXXX
XXXX XXXXX RAYSMAN & XXXXXXX LLP
By:
/s/
Name:
Title:
SELLING
STOCKHOLDERS:
WEICHENG
INTERNATIONAL INC.
By:
/s/
Name:
Title:
Address:
___________________________________
_____________________________________
Fax:_______________________________________
XXXXXX
GROWTH LTD.
By:
/s/
Name:
Title:
Address:
___________________________________
_____________________________________
Fax:_______________________________________
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