ESCROW AGREEMIENT
THIS ESCROW AGREEMENT, dated as of October 1, 2001
("Escrow Agreement"), is by and between Village
XII Acquisition Co., Inc., a Nevada corporation
(the "Principal"); the individuals listed on
Schedule A (the "Selling Security Holders"); and
First Union National Bank, a national banking
association, as Escrow Agent hereunder ("Escrow
Agent").
BACKGROUND
A. Selling Security Holders are to sell up to
229,000./ common shares, par value $.001 (the
"Shares ") at the offering price of $.10 per
common share, pursuant to Registration Statement
No. 333-57372 filed with the Securities and
Exchange Commission (the "SEC") and attached
hereto as Exhibit A (the "Offering Document").
B. In accordance with the Offering Document,
subscribers to the Shares (the "Subscribers" and
individually, a "Subscriber") will be required to
submit full payment for their respective
investments at the time they enter into
subscription agreements.
C. In accordance with the Offering Document, all
payments received by Selling Security Holders in
connection with subscriptions for Shares together
with the stock certificates representing the
shares sold, shall be promptly forwarded to Escrow
Agent, and Escrow Agent has agreed to accept,
hold, and disburse such funds and stock
certificates deposited with it and the earnings
thereon until a merger occurs between the
Principal and an acquiring company, or the Escrow
is terminated as hereinafter set forth in this
Agreement.
D. In order to establish the escrow of funds and
to effect the provisions of the Offering Document,
the parties hereto have entered into this Escrow
Agreement.
STATEMENT OF AGREEMENT
NOW THEREFORE, for good and valuable
consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto,
for themselves, their successors and assigns,
hereby agree as follows:
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1. Definitions.
The following terms shall have the following
meanings when used herein:
"Cash Investment" shall mean the number of Shares
to be purchased by any Subscriber multiplied by
the offering price per Share of $.10 as set forth
in the Offering Document.
"Cash Investment Instrument" shall mean a check,
money order or similar instrument, made payable to
the "First Union National Bank/Village XII
Acquisition Co., Inc. Escrow Account," in full
payment for the Shares to be purchased by any
Subscriber.
"Escrow Funds" shall mean all offering proceeds,
after deduction of cash paid for underwriting
commissions, underwriting expenses and dealer
allowances, provided, however, that no deduction
may be made for underwriting commissions,
underwriting expenses or dealer allowances payable
to an affiliate of the Principal, deposited with
the Escrow Agent pursuant to this Agreement,
together with any interest and other income
thereon.
"Pro Rata Basis," with respect to the allocation
among Subscribers of interest and other earnings
held in the Escrow Funds, shall mean, for each
Subscriber, the Subscriber's Cash Investment
multiplied by the number of days the Cash
Investment of such Subscriber was held in
interest-bearing investments pursuant to Section 6
hereof, multiplied by the average yield earned on
the Escrow Funds during such period of days.
"Shares" shall have the meaning set forth in the
section of this Escrow Agreement titled
"Background".
"Subscriber " or " Subscribers " shall have the
meaning set forth in the section of this Escrow
Agreement titled "Background".
"Subscription Accounting" shall mean an accounting
of all subscriptions for Shares received and
accepted Selling Security Holders as of the date
of such accounting, indicating for each
subscription the Subscriber's name, social
security number and address, the number and total
purchase price of subscribed Shares, the date of
receipt by Selling Security Holders of the Cash
Investment Instrument, and notations of any
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nonpayment of the Cash Investment Instrument
submitted with such subscription, any withdrawal
of such subscription by the Subscriber, any
rejection of such subscription by Selling Security
Holders, or other termination, for whatever
reason, of such subscription.
2. Appointment of and Acceptance by Escrow Agent.
Principal and Selling Security Holders hereby
appoint Escrow Agent to serve as escrow agent
hereunder, and Escrow Agent hereby accepts such
appointment in accordance with the terms of this
Escrow Agreement.
3. Deposits into Escrow.
a. The account records of the Escrow Agent shall
provide that the funds in the escrow account are
held for the benefit of the Subscriber(s) named
and identified in accordance the records of the
Escrow Agent, maintained in good faith and in the
regular course of business, and they shall show
the name and interest of each party to the
account.
b. Upon receipt by Selling Security Holders of any
Cash Investment Instrument for the purchase of
Shares, Selling Security Holders shall forward to
Escrow Agent, by 12:00 noon of the next business
day, the Cash Investment Instrument for deposit
into the following escrow account:
First Union National Bank
Charlotte, North Carolina
ABA # 000000000
D/ 5000000016439
FFC: (*TBD)
Attn: CT BR#4850
Each such deposit shall be accompanied by the
following documents:
(1) a report containing such Subscriber's name,
social security number or taxpayer identification
number, address and other information required for
withholding purposes;
(2) a Subscription Accounting; and
(3) instructions regarding the investment of
such deposited funds in accordance with Section 6
hereof
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ALL FUNDS SO DEPOSITED AND INTEREST OR DIVIDENDS
THEREON, IF ANY, SHALL BE HELD FOR THE SOLE
BENEFIT OF AND SHALL REMAIN THE PROPERTY OF THE
SUBSCRIBERS ACCORDING TO THEIR RESPECTIVE
INTERESTS AND SHALL NOT BE SUBJECT TO ANY LIEN OR
CHARGE BY ESCROW AGENT OR BY JUDGMENT OR
CREDITORS' CLAIMS AGAINST VILLAGE XII ACQUISITION
CORP. UNTIL RELEASED TO VILLAGE XII ACQUISITION
CORP. IN ACCORDANCE WITH SECTION 4(a) HEREOF.
c. Selling Security Holders understand and agree
that all checks and similar instruments received
by Escrow Agent hereunder are subject to
collection requirements of presentment and final
payment, and that the funds represented thereby
cannot be drawn upon or disbursed until such time
as final payment has been made and is no longer
subject to dishonor. Upon receipt, Escrow Agent
shall process each Cash Investment Instrument for
collection, and the proceeds thereof shall be held
as part of the Escrow Funds until disbursed in
accordance with Section 4 hereof. If, upon
presentment for payment, any Cash Investment
Instrument is dishonored, Escrow Agent's sole
obligation shall be to notify Principal and
Selling Security Holders of such dishonor and to
return such Cash Investment Instrument to Selling
Security Holders to take whatever action it deems
necessary. Notwithstanding the foregoing, if for
any reason any Cash Investment Instrument is
uncollectible after payment of the funds
represented thereby has been made by Escrow Agent,
Village XII Acquisition Co., Inc. shall
immediately reimburse Escrow Agent upon receipt
from Escrow Agent of written notice thereof.
Upon receipt of any Cash Investment Instrument
that represents payment less than or greater than
the Cash Investment, Escrow Agent's sole
obligation shall be to notify the Selling Security
Holders of such fact and to return such Cash
Investment Instrument to the Subscriber.
d. All Cash Investment Instruments shall be made
payable to the order of, or endorsed to the order
of, "First Union National Bank/Village XII
Acquisition Co., Inc. - Escrow Account, " and
Escrow Agent shall not be obligated to accept, or
present for payment, any Cash Investment
Instrument that is not payable or endorsed in that
manner.
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4. Disbursements of Escrow Funds.
a. Completion of Merger. Subject to the
provisions of Section 10 hereof, Escrow Agent
shall pay to the Selling Security Holders the
liquidated value of the Escrow Funds, by certified
or bank check or by wire transfer, no later than
fifteen (15) business days following receipt of
the following documents:
(1) A Release Notice (the "Release Notice")
issued by the Principal only upon the closing of a
successful merger between Principal and an
acceptable merger candidate;
(2) The Release Notice shall be accompanied by
proof of a successful merger consisting of
certified copies of the articles of merger filed
with the Secretary of State within the respective
jurisdictions of the Principal and the merger
candidate;
(3) The documents described on Exhibit B
attached hereto and incorporated herein by
reference; and
(4) Such other certificates, notices or other
documents as Escrow Agent shall reasonably
require.
After the initial disbursement of Escrow Funds to
Selling Security Holders pursuant to this Section
4(a), Escrow Agent shall pay Selling Security
Holders any additional funds received with respect
to the Shares, by certified or bank check or wire
transfer, no later than fifteen (15) business days
after receipt.
b. Rejection of Any Subscription or Termination of
the Offering. No later than fifteen (15) business
days after receipt by Escrow Agent of written
notice (i) from Principal that the Principal's
offering has terminated and that there will be no
closing of the sale of Shares to Subscribers; or
(ii) from Principal that a merger will not occur;
or (iii) from Principal Selling Security Holders
intend to reject a Subscriber's subscription; or
(iv) from the SEC or any other federal or state
regulatory authority that a stop order has been
issued with respect to the Offering Document and
has remained in effect for at least twenty (20)
days, Escrow Agent shall (a) pay to the applicable
Subscriber(s), by certified or bank check and by
first class mail, the amount of the Cash
Investment paid by each Subscriber; (b) pay as
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soon as practicable to the applicable
Subscriber(s), by certified or bank check and by
first class mail, each Subscriber's share of
income earned on the Escrow Funds, each such share
to be calculated on a Pro Rata Basis; and (c)
deliver to Principal stock certificates of the
applicable Subscribers(s), and Selling Security
Holders to Principal for delivery to the holders
of the stock certificates .
C. Expiration of Offering Period. Notwithstanding
anything to the contrary contained herein, if
Escrow Agent shall not have received a Release
Notice on or before December 31, 2002, Escrow
Agent shall, within fifteen (15) business days
after such date and without any further
instruction or direction from Principal, return to
each Subscriber, by certified or bank check and by
first class mail, the Cash Investment made by such
Subscriber, and shall pay as soon as practicable
to the applicable Subscriber(s), by certified or
bank check and by first class mail, each
Subscriber's share of income earned on the Escrow
Funds, each such share to be calculated on a Pro
Rata Basis as calculated by the Principal and
provided to the Escrow Agent.
5. Suspension of Performance or Disbursement Into
Court. If, at any time, there shall exist any
dispute between Principal, Selling Security
Holders, Escrow Agent, any Subscriber or any other
person with respect to the holding or disposition
of any portion of the Escrow Funds or any other
obligations of Escrow Agent hereunder, or if at
any time Escrow Agent is unable to determine, to
Escrow Agent's sole satisfaction, the proper
disposition of any portion of the Escrow Funds or
Escrow Agent's proper actions with respect to its
obligations hereunder, or if Principal has not
within 30 days of the furnishing by Escrow Agent
of a notice of resignation pursuant to Section 7
hereof appointed a successor Escrow Agent to act
hereunder, then Escrow Agent may, in its sole
discretion, take either or both of the following
actions:
a. suspend the performance of any of its
obligations under this Escrow Agreement until such
dispute or uncertainty shall be resolved to the
sole satisfaction of Escrow Agent or until a
successor Escrow Agent shall have been appointed
(as the case may be); provided however, that
Escrow Agent shall continue to invest the Escrow
Funds in accordance with Section 6 hereof, and/or
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b. petition (by means of an interpleader action or
any other appropriate method) any court of
competent jurisdiction in Miami, Florida, for
instructions with respect to such dispute or
uncertainty, and pay into such court all funds
held by it in the Escrow Funds for holding and
disposition in accordance with the instructions of
such court.
Escrow Agent shall have no liability to Principal,
Selling Security Holders, any Subscriber or any
other person with respect to any such suspension
of performance or disbursement into court,
specifically including any liability or claimed
liability that may arise, or be alleged to have
arisen, out of or as a result of any delay in the
disbursement of funds held in the Escrow Funds or
any delay in or with respect to any other action
required or requested of Escrow Agent.
6. Deposit and Investment of Funds.
a. Escrow Agent shall invest and reinvest the
Escrow Funds as the Principal shall direct in
writing; provided, however, that no investment or
reinvestment may be made except in the following:
(1) direct obligations of the United States of
America or obligations the principal of and the
interest on which are unconditionally guaranteed
by the United States of America; or
(2) money market mutual funds which invest solely
in United States Treasury securities which are
direct obligations of the United States of America
or repurchase agreements that are fully
collateralized by direct obligations of the United
States of America.
If Escrow Agent has not received written
instructions from Selling Security Holders at any
time that an investment decision must be made,
Escrow Agent shall invest the Escrow Funds, or
such portion thereof as to which no written
instructions have been received, in the Evergreen
Institutional Treasury Money Market Fund Resource
Class. Each of the foregoing investments shall be
made in the name of Escrow Agent in its stated
capacity as escrow agent. No investment shall be
made in any instrument or security that has a
maturity of greater than six (6) months.
Notwithstanding anything to the contrary contained
herein, Escrow Agent may, without notice to
Selling Security Holders, sell or liquidate any of
the foregoing investments at any time if the
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proceeds thereof are required for any release of
funds permitted or required hereunder, and Escrow
Agent shall not be liable or responsible for any
loss, cost or penalty resulting from any such sale
or liquidation. With respect to any funds
received by Escrow Agent for deposit into the
Escrow Funds or any written investment instruction
of Principal received by Escrow Agent after ten
o'clock, a.m., Charlotte, North Carolina, time,
Escrow Agent shall not be required to invest such
funds or to effect such investment instruction
until the next day upon which banks in Charlotte,
North Carolina, are open for business.
b. Interest or dividends earned on the Escrow
Funds, if any, shall be held in the escrow or
trust account until the funds are released in
accordance with the provisions of this agreement.
If funds held in escrow or trust account are
released to the Selling Security Holders, interest
or dividends earned on such funds up to the date
of release may be released to the Selling Security
Holders.
Note - No longer applicable
7. Deposit of Securities.
a. All securities issued in connection with the
offering, whether or not for cash consideration,
and any other securities issued with respect to
such securities, including securities issued with
respect to stock splits, stock dividends, or
similar rights, shall be deposited directly into
the escrow or trust account promptly upon
issuance. The identity of the Subscriber(s) shall
be included on the stock certificates or other
documents evidencing such securities.
b. Securities held in the escrow or trust account
are to remain as issued and deposited and shall be
held for the sole benefit of the Subscriber(s),
who shall have voting rights, if any, with respect
to securities held in their names, as provided by
applicable state law. No transfer or other
disposition of securities held in the escrow or
trust account or any interest related to such
securities shall be permitted other than by will
or the laws of descent and distribution, or
pursuant to a qualified domestic relations order.
C. Warrants, convertible securities or other
derivative securities relating to securities held
in the escrow or trust account may be exercised or
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converted in accordance with their terms;
provided, however, that securities received upon
exercise or conversion, together with any cash or
other consideration paid in connection with the
exercise or conversion, are promptly deposited
into the escrow or trust account.
8. Resignation and Removal of Escrow Agent.
Escrow Agent may resign from the performance of
its duties hereunder at any time by giving ten
(10) days' prior written notice to Principal and
Selling Security Holders or may be removed, with
or without cause, by Selling Security Holders,
acting in writing, at any time by the giving of
ten (10) days' prior written notice to Escrow
Agent. Such resignation or removal shall take
effect upon the appointment of a successor Escrow
Agent as provided herein below. Upon any such
notice of resignation or removal, Principal and
Selling Security Holders jointly shall appoint a
successor Escrow Agent hereunder, which shall be a
commercial bank, trust company or other financial
institution with a combined capital and surplus in
excess of $10,000,000. Upon the acceptance in
writing of any appointment as Escrow Agent
hereunder by a successor Escrow Agent, such
successor Escrow Agent shall thereupon succeed to
and become vested with all the rights, powers,
privileges and duties of the retiring Escrow
Agent, and the retiring Escrow Agent shall be
discharged from its duties and obligations under
this Escrow Agreement, but shall not be discharged
from any liability for actions taken as escrow
agent hereunder prior to such succession. After
any retiring Escrow Agent's resignation or
removal, the provisions of this Escrow Agreement
shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Escrow
Agent under this Escrow Agreement.
9. Liability of Escrow Agent.
a. Escrow Agent shall have no liability or
obligation with respect to the Escrow Funds except
for Escrow Agent's willful misconduct or gross
negligence. Escrow Agent's sole responsibility
shall be for the safekeeping, investment, and
disbursement of the Escrow Funds in accordance
with the terms of this Escrow Agreement. Escrow
Agent shall have no implied duties or obligations
and shall not be charged with knowledge or notice
of any fact or circumstance not specifically set
forth herein. Escrow Agent may rely upon any
instrument, not only as to its due execution,
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validity and effectiveness, but also as to the
truth and accuracy of any information contained
therein which Escrow Agent shall in good faith
believe to be genuine, to have been signed or
presented by the person or parties purporting to
sign the same and to conform to the provisions of
this Escrow Agreement. In no event shall Escrow
Agent be liable for incidental, indirect, special,
consequential or punitive damages. Escrow Agent
shall not be obligated to take any legal action or
continence any proceeding in connection with the
Escrow Funds or any account in which Escrow Funds
are deposited or this Escrow Agreement, or to
appear in, prosecute or defend any such legal
action or proceeding. Without limiting the
generality of the foregoing, Escrow Agent shall
not be responsible for or required to enforce any
of the terms or conditions of any subscription
agreement with any Subscriber or any other
agreement between Principal, Selling Security
Holders and/or any Subscriber. Escrow Agent shall
not be responsible or liable in any manner for the
performance by Principal or any Subscriber of
their respective obligations under any
subscription agreement nor shall Escrow Agent be
responsible or liable in any manner for the
failure of Principal, Selling Security Holders or
any third party (including any Subscriber) to
honor any of the provisions of this Escrow
Agreement. Escrow Agent may consult legal counsel
selected by it in the event of any dispute or
question as to the construction of any of the
provisions hereof or of any other agreement or of
its duties hereunder, and shall incur no liability
and shall be fully indemnified from any liability
whatsoever in acting in accordance with the
opinion or instruction of such counsel. Principal
shall promptly pay, upon demand, the reasonable
fees and expenses of any such counsel.
b . The Escrow Agent is authorized, in its sole
discretion, to comply with orders issued or
process entered by any court with respect to the
Escrow Funds, without determination by the Escrow
Agent of such court's jurisdiction in the matter.
If any portion of the Escrow Funds is at any time
attached, garnished or levied upon under any court
order, or in case the payment, assignment,
transfer, conveyance or delivery of any such
property shall be stayed or enjoined by any court
order, or in case any order, judgment or decree
shall be made or entered by any court affecting
such property or any part thereof, then and in any
such event, the Escrow Agent is authorized, in its
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sole discretion, to rely upon and comply with any
such order, writ, judgment or decree which it is
advised by legal counsel selected by it is binding
upon it without the need for appeal or other
action; and if the Escrow Agent complies with any
such order, writ, judgment or decree, it shall not
be liable to any of the parties hereto or to any
other person or entity by reason of such
compliance even though such order, writ, judgment
or decree may be subsequently reversed, modified,
annulled, set aside or vacated.
10. Indemnification of Escrow Agent. From and at
all times after the date of this Escrow Agreement,
Principal and Selling Security Holders shall, to
the fullest extent permitted by law, indemnify and
hold harmless the Escrow Agent and each director,
officer, employee, attorney, agent and affiliate
of Escrow Agent (collectively, the "Indemnified
Parties") against any and all actions, claims
(whether or not valid), losses, damages,
liabilities, costs and expenses of any kind or
nature whatsoever (including without rotation
reasonable attorneys' fees, costs and expenses)
incurred by or asserted against any of the
Indemnified Parties from and after the date
hereof, whether direct, indirect or consequential,
as a result of or arising from or in any way
relating to any claim, demand, suit, action or
proceeding (including any inquiry or
investigation) by any person, including without
limitation Principal or Selling Security Holders,
whether threatened or initiated, asserting a claim
for any legal or equitable remedy against any
person under any statute or regulation, including,
but not limited to, any federal or state
securities laws, or under any common law or
equitable cause or otherwise, arising from or in
connection with the negotiation, preparation,
execution, performance or failure of performance
of this Escrow Agreement or any transactions
contemplated herein, whether or not any such
Indemnified Party is a party to any such action,
proceeding, suit or the target of any such inquiry
or investigation; provided, however, that no
Indemnified Party shall have the right to be
Indemnified hereunder for any liability finally
determined by a court of competent jurisdiction,
subject to no further appeal, to have resulted
solely from the gross negligence or willful
misconduct of such Indemnified Party. If any such
action or claim shall be brought or asserted
against any Indemnified Party, such Indemnified
Party shall promptly notify Principal in writing,
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and Principal shall assume the defense thereof,
including the employment of counsel and the
payment of all expenses. Such Indemnified Party
shall, in its sole discretion, have the right to
employ separate counsel (who may be selected by
such Indemnified Party in its sole discretion) in
any such action and to participate in the defense
thereof, and the fees and expenses of such counsel
shall be paid by such Indemnified Party, except
that Principal shall be required to pay such fees
and expenses (a) Principal agrees to pay such fees
and expenses, or (b) Principal shall fail to
assume the defense of such action or proceeding or
shall fail, in the reasonable discretion of such
Indentified Party, to employ counsel satisfactory
to the Indemnified Party in any such action or
proceeding, (c) Principal is the plaintiff in any
such action or proceeding or (d) the named parties
to any such action or proceeding (including any
impleaded parties) include both Indemnified Party
and Principal, and Indemnified Party shall have
been advised by counsel that there may be one or
more legal defenses available to it which are
different from or additional to those available to
Principal. Principal shall be liable to pay fees
and expenses of counsel pursuant to the preceding
sentence. All such fees and expenses, payable by
Principal pursuant to the foregoing sentence shall
be paid from time to time as incurred, both in
advance of and after the final disposition of such
action or claim. The obligations of Principal and
Selling Security Holders under this Section 10
shall survive any termination of this Escrow
Agreement and the resignation or removal of Escrow
Agent.
11. Compensation to Escrow Agent.
C. Fees and Expenses. Principal shall compensate
Escrow Agent for its services hereunder in
accordance with Exhibit C attached hereto and, in
addition, shall reimburse Escrow Agent for all of
its reasonable out-of-pocket expenses, including
attorneys' fees, travel expenses, telephone and
facsimile transmission costs, postage (including
express mail and overnight delivery charges),
copying charges and the like. All of the
foregoing compensation and reimbursement
obligations shall be payable by Principal upon
demand by Escrow Agent. The obligations of
Principal under this Section 11 shall survive any
termination of this Escrow Agreement and the
resignation or removal of Escrow Agent.
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d. Disbursements from Escrow Funds to Pay Escrow
Agent. The Escrow Agent is authorized to and may
disburse from time to time, to itself or to any
Indemnified Party from the Escrow Funds (to the
extent of Principal's and Selling Security
Holder's rights thereto), the amount of any
compensation and reimbursement of out-of-pocket
expenses due and payable hereunder (including any
amount to which Escrow Agent or any Indemnified
Party is entitled to seek indemnification pursuant
to Section 10 hereof). Escrow Agent shall notify
Principal of any disbursement from the Escrow
Funds to itself or to any Indemnified Party in
respect of any compensation or reimbursement
hereunder and shall furnish to Principal copies of
all related invoices and other statements.
e. Security and Offset. Principal and Selling
Security Holders hereby grant to Escrow Agent and
the Indemnified Parties a security interest in and
lien upon the Escrow Funds (to the extent of
Principal's rights thereto) to secure all
obligations hereunder, and Escrow Agent and the
Indemnified Parties shall have the right to offset
the amount of any compensation or reimbursement
due any of them hereunder (including any claim for
indemnification pursuant to Section 10 hereof)
against the Escrow Funds (to the extent of
Principal's rights thereto.) If for any reason the
Escrow Funds available to Escrow Agent and the
Indemnified Parties pursuant to such security
interest or right of offset are insufficient to
cover such compensation and reimbursement,
Principal shall promptly pay such amounts to
Escrow Agent and the Indemnified Parties upon
receipt of an itemized invoice.
12. Representations and Warranties; Legal
Opinions.
a. Principal makes the following representations
and warranties to Escrow Agent:
(1) Principal is a corporation duly organized,
validly existing, and in good standing under the
laws of the State of Nevada, and has full power
and authority to execute and deliver this Escrow
Agreement and to perform its obligations
hereunder;
(2) This Escrow Agreement has been duly approved
by all necessary corporate action of Principal,
including any necessary shareholder approval, has
been executed by duly authorized officers of
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Principal, and constitutes a valid and binding
agreement of Principal, enforceable in accordance
with its terms.
(3) The execution, delivery, and performance by
Principal of this Escrow Agreement will not
violate, conflict with, or cause a default under
the articles of incorporation or bylaws of
Principal, any applicable law or regulation, any
court order or administrative ruling or decree to
which Principal is a party or any of its property
is subject, or any agreement, contract, indenture,
or other binding arrangement to which Principal is
a party or any of its property is subject. The
execution, delivery and performance of this
Agreement is consistent with and accurately
described in the Offering Document, and the
allocation of interest and other earnings to
Subscribers, as set forth in Sections 4(b) and 4c
hereof, has been properly described therein.
(4) No party other than the parties hereto and
the prospective Subscribers have, or shall have,
any lien, claim or security interest in the Escrow
Funds or any part thereof. No financing statement
under the Uniform Commercial Code is on file in
any jurisdiction claiming a security interest in
or describing (whether specifically or generally)
the Escrow Funds or any part thereof.
(5) Principal hereby acknowledges that the
status of Escrow Agent is that of agent only for
the limited purposes set forth herein, and hereby
represents and covenants that no representation or
implication shall be made that the Escrow Agent
has investigated the desirability or advisability
of investment in the Shares or has approved,
endorsed or passed upon the merits of the
investment therein and that the name of the Escrow
Agent has not and shall not be used in any manner
in connection with the offer or sale of the Shares
other than to state that the Escrow Agent has
agreed to serve as escrow agent for the limited
purposes set forth herein.
(6) All of the representations and warranties of
Principal contained herein are true and complete
as of the date hereof and will be true and
complete at the time of any deposit to or
disbursement from the Escrow Funds.
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b. Selling Security Holders make the following
representations and warranties to Escrow Agent:
(1) Selling Security Holder has full power and
authority to execute and deliver this Escrow
Agreement and to perform its obligations
hereunder;
(2) This Escrow Agreement constitutes a valid
and binding agreement of the Selling Security
Holder, enforceable in accordance with its terms.
(3) The execution, delivery, and performance by
Selling Security Holder of this Escrow Agreement
will not violate, conflict with, or cause a
default under any applicable law, regulation or
license, any court order or administrative ruling
or decree to which Selling Security Holder is a
party or any of its property is subject, or any
agreement, contract, indenture, or other binding
arrangement to which Selling Security Holder is a
party or any of its property is subject. The
execution, delivery and performance of this
Agreement is consistent with and accurately
described in the Offering Document, and the
allocation of interest and other earnings to
Subscribers, as set forth in Sections 4(b) and
4(c) hereof, has been properly described therein.
(4) The deposit with Escrow Agent by Selling
Security Holder of Cash Investment Instruments
pursuant to Section 3 hereof shall be deemed a
representation and warranty by Selling Security
Holder that such Cash Investment Instrument
represents a bona fide sale to the Subscriber
described therein of the amount of Shares set
forth therein, subject to and in accordance with
the terms of the Offering Document.
(5) Selling Security Holder hereby acknowledges
that the status of Escrow Agent is that of agent
only for the limited purposes set forth herein,
and hereby represents and covenants that no
representation or implication shall be made that
the Escrow Agent has investigated the desirability
or advisability of investment in the Shares or has
approved, endorsed or passed upon the merits of
the investment therein and that the name of the
Escrow Agent has not and shall not be used in any
manner in connection with the offer or sale of the
Shares other dm to state that the Escrow Agent has
agreed to serve as escrow agent for the limited
purposes set forth herein.
16
(6) All of the representations and warranties of
Selling Security Holder contained herein are true
and complete as of the date hereof and will be
true and complete at the time of any deposit to or
disbursement from the Escrow Funds.
13. Consent to Jurisdiction and Venue. In the
event that any party hereto commences a lawsuit or
other proceeding relating to or arising from this
Agreement, the parties hereto agree that the
United States District Court for the District of
Florida containing Lake Worth, Florida shall have
the sole and exclusive jurisdiction over any such
proceeding. If all such courts lack federal
subject matter jurisdiction, the parties agree
that the Superior Court of Florida, District
containing Lake Worth, Florida shall have sole and
exclusive jurisdiction. Any of these courts shall
be proper venue for any such lawsuit or judicial
proceeding and the parties hereto waive any
objection to such venue. The parties hereto
consent to and agree to submit to the jurisdiction
of any of the courts specified herein and agree to
accept service or process to vest personal
jurisdiction over them in any of these courts.
14. Notice. All notices and other communications
hereunder shall be in writing and shall be deemed
to have been validly served, given or delivered
five (5) days after deposit in the United States
mails, by certified mail with return receipt
requested and postage prepaid, when delivered
personally, one (1) day after delivery to any
overnight courier, or when transmitted by
facsimile transmission facilities, and addressed
to the party to be notified as follows:
If to Principal and Selling Security Holders at:
Village XII Acquisition Co., Inc.
00 Xxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
ATTENTION: Xxxx Xxxxxxxx
Facsimile Number: (561) 586 - 7742
If to the Escrow Agent at:
First Union National Bank as Escrow Agent
000 Xxxxx Xxxxxxxx Xxxx., 00xx xxxxx
Xxxxx, Xxxxxxx 00000
ATTENTION:
Facsimile Number: (000) 000-0000
17
or to such other address as each party may
designate for itself by like notice.
15. Amendment or Waiver. This Escrow Agreement
may be changed, waived, discharged or terminated
only by a writing signed by Principal, Selling
Security Holders and Escrow Agent. No delay or
omission by any party in exercising any right with
respect hereto shall operate as a waiver. A
waiver on any one occasion shall not be construed
as a bar to, or waiver of, any right or remedy on
any future occasion.
16. Severability. To the extent any provision of
this Escrow Agreement is prohibited by or invalid
under applicable law, such provision shall be
ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of
such provision or the remaining provisions of this
Escrow Agreement.
17. Governing Law. This Escrow Agreement shall
be construed and interpreted in accordance with
the internal laws of the State of Florida without
giving effect to the conflict of laws principles
thereof.
18. Entire Agreement. This Escrow Agreement
constitutes the entire agreement between the
parties relating to the acceptance, collection,
holding, investment and disbursement of the Escrow
Funds and sets forth in their entirety the
obligations and duties of the Escrow Agent with
respect to the Escrow Funds.
19. Binding Effect. All of the terms of this
Escrow Agreement, as amended, from time to time,
shall be binding upon, inure to the benefit of and
be enforceable by the respective successors and
assigns of Principal and Selling Security Holders,
Principal and Escrow Agent.
20. Execution in Counterparts. This Escrow
Agreement may be executed in two or more
counterparts, which when so executed shall
constitute one and the same agreement.
21. Termination. Upon the first to occur of the
disbursement of all amounts in the Escrow Funds or
deposit of all amounts in the Escrow Funds into
court pursuant to Section 5 hereof, this Escrow
Agreement shall terminate and Escrow Agent shall
18
have no further obligation or liability whatsoever
with respect to this Escrow Agreement or the
Escrow Funds.
22. Dealings. The Escrow Agent and any
stockholder, director, officer or employee of the
Escrow Agent may buy, sell, and deal in any of the
securities of the Principal and become pecuniarily
interested in any transaction in which the
Principal may be interested, contract and lend
money to the Principal and otherwise act as fully
and freely as though it were not Escrow Agent
under this Agreement. Nothing herein shall
preclude the Escrow Agent from acting in any other
capacity for the Principal or any other entity.
IN WITNESS WHEREOF, the parties hereto have caused
this Escrow Agreement to be executed under seal as
of the date first above written.
Village XII Acquisition Corp.
By: Xxxxx Xxxxxxxx
Title: President
[Corporate Seal]
ATTEST:
/s/Xxxx Xxxxxxxx
Xxxx Xxxxxxxx
Secretary
The Chelverton Fund, LLC
By: /s/Xxxxx Xxxxxx
Fund Manager
/s/Xxxxxx X. Xxxxxxxxx
Trustee of the Xxxxxx X.
Xxxxxxxxx Revocable Living Trust
/s/Xxxxxxx X. Xxxxxxxxx
Trustee of the Xxxxxxx Xxxxxxxxx
Revocable Living Trust
/s/Xxxx X. Xxxxxx
/s/Xxxxx Sypnienski
/s/Xxxxxxx Xxxxxxxx
/s/Xxxxxxxx X. Xxxxx
19
/s/Xxxxx X. Xxxx
/s/Xxxxxxx Xxxxxxxx
/s/Xxxxx Xxxx
/s/Xxxx X. Xxxx
/s/Xxxxxxx Xxxx
/s/Xxxxx X. Xxxxx
/s/Xxxxx X. Xxxxxxx
/s/Xxxx Xxxxxxx
Xxxxxxx Xxxxxxx
/s/Xxxx Xxxxxxxx POA
Xxxx X. Xxxxxxx
By: /s/Xxxx Xxxxxxxx POA
FIRST UNION NATIONAL BANK, as Escrow Agent
By: /s/Xxxxxx Xxxxxxxx
Title: Vice President
20
Specific Power of Attorney
BE IT ACKNOWLEDGED, That I, Xxxxxxx Xxxxxxx the
undersigned, do hereby grant a limited and
specific power of attorney to Xxxx Xxxxxxxx, as my
attorney-in-fact. Said attorney-in-fact shall
have full power and authority to undertake and
perform only the following acts on my behalf.
To sign all documents pertaining to the execution
of the escrow agreement and issuance of shares,
when effective, of Village XII Acquisition
Corporation.
The authority herein shall include such incidental
acts as are reasonably required to carry out and
perform the specific authorities granted herein.
My attorney-in-fact agrees to accept this
appointment subject to its terms, and agrees to
act and perform in said fiduciary capacity
consistent with my best interest as he/she in
his/her discretion deems advisable.
This power of attorney is effective upon
execution. This power of attorney may be revoked
by at any time, and shall automatically be revoked
upon my death, provided any person relying on this
power of attorney shall have full rights to accept
and rely upon the authority of my attorney-in-fact
until in receipt of actual notice of revocation.
Signed this 24 day of May, 2001
Witness
Grantor: Xxxxxxx Xxxxxxx
Witness: Xxxxx Xxxxx
Attorney-in Fact: Xxxx Xxxxxxxx
STATE OF FLORIDA
COUNTY OF
On 5/24/01 before me, Xxxxxxx Xxxxxxx personally
appeared, personally known to me (or proved to me
on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that
he/she/they executed the same in his/her/their
authorized capacity (ies), and that by
his/her/their signature(s) on the
21
instrument the person(s), or the entity behalf of
which the person(s) acted, executed the
instrument.
Signature /s/XxXxx Xxxxxxxx
Affiant X Known Unknown
(Seal) ID Produced
XxXxx Xxxxxxxx
MY COMMISSION # CC835535 Expires
June 18, 2003
BONDED THRU XXXX XXXX INSURANCE, INC.
22
Specific Power of Attorney
BE IT ACKNOWLEDGED, That I, Xxxx X. Xxxxxxx the
undersigned, do hereby grant a limited and
specific power of attorney to Xxxx Xxxxxxxx, as my
attorney-in-fact. Said attorney-in-fact shall
have full power and authority to undertake and
perform only the following acts on my behalf:
To sign all documents pertaining to the execution
of the escrow agreement and issuance of shares,
when effective, of Village XII Acquisition
Corporation.
The authority herein shall include such incidental
acts as are reasonably required to carry out and
perform the specific authorities granted herein.
My attorney-in-fact agrees to accept this
appointment subject to its terms, and agrees to
act and perform in said fiduciary capacity
consistent with my best interest as he/she in
his/her discretion deems advisable.
This power of attorney is effective upon
execution. This power of attorney may be revoked
by at any time, and shall automatically be revoked
upon my death, provided any person relying on this
power of attorney shall have full rights to accept
and rely upon the authority of my attorney-in-fact
until in receipt of actual notice of revocation.
Signed this 26th day of May, 2001
Grantor: Xxxx Xxxxxxx
Witness: Xxxxx Xxxxx
Attorney-in Fact: Xxxx Xxxxxxxx
STATE OF
COUNTY OF
On 5/26/2001 before me, Xxxx Xxxxxxx, personally
appeared, personally known to (or proved to me on
the basis satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that
he/she/they executed the same in his/her/their
authorized capacity (ies), and that by
his/her/their signature(s) on the instrument the
person(s), or the entity upon behalf of whiph the
person(s) acted, executed the instrument.
Signature XxXxx Xxxxxxxx Affiant
X Known Unknown ID Produced
XxXxx Xxxxxxxx
MY COMMISSION # CC835545 EXPIRES
June 18, 2003
BONDED THRU XXXX XXXX INSURANCE, INC
24
Exhibit A
Offering Document
25
Exhibit B
Additional Documents Required
for Release of Escrow Funds
Pursuant to Section 4(a)
1. Certificate of Xxxx Xxxxxxxx, President of
Village XII Acquisition Co., Inc., that (a) the
Offering Document has been declared effective
under the Securities Act of 1933, and (b) no stop
order has been issued or threatened to be issued
by the SEC or any other federal or state
regulatory authority in connection with the
Offering Document or the offering of Shares
pursuant thereto; and
2. An opinion of counsel to Principal that (a) the
Offering Document has been declared effective
under the Securities Act of 1933, and (b) to the
best of its knowledge, no stop order has been
issued or threatened to be issued by the SEC or
any other federal or state regulatory authority in
connection with the Offering Document or the
offering of Shares pursuant thereto.
26
Exhibit C
Fee Schedule for Escrow Agent
Name of Firm First Union National
Bank
Contact Xxxxxx Xxxxxxxx
Phone Number 000-000-0000 Fax: 615-
341-3927
Fee Proposal
Acceptance Fee Waived
Administration Fee $2,500
(to be deducted from 1st closing)
Out-of-Pocket Expenses At cost
Legal Fee (max.) At cost
Transactions $10 per deposit (first 100
at no charge) $15 per
disbursement *
The Legal Fee covers the costs of drafting /review
governing document by First Union's counsel. Such
Legal Fee is payable even if the parties involved
decide not to proceed with the transaction for any
reason whatsoever, and is in addition to fees
payable for our administration of the account.
Out-of-pocket expenses incurred in rendering any
service covered by this schedule are in addition
to the fees quoted. Expenses for which First
Union is normally reimbursed include, but are not
limited to, counsel fees, travel expenses,
publications, printing costs, postage, and coufier
charges.
This fee is based on the Escrow Agent being
required to send check checks back to the
investors, if required.
Approved & Acknowledged by:
Authorized Representative
The fees quoted above are based solely on the
information provided to First Union at the time of
submission. If the parameters for this
transaction change for any reason we reserve the
right to adjust our fees accordingly.
