STOCK ESCROW AGREEMENT
As described in the Letter of Intent dated July 13, 2001 relating to the
proposed Plan of Reorganization and Stock Exchange Agreement among Unistone,
Inc. ("UI"), Cash Systems, Inc. ("CSI"), Corporate Capital Management, LLC
("CCM"), Xxxxxx Services, Inc. ("Xxxxxx"), and the shareholders of CSI (the
"Agreement"), those who would be parties to the Agreement have agreed that
after the consummation of the Reorganization, the stockholders of UI would
hold a total of 1,100,000 shares of common stock of UI and that CCM and Xxxxxx
and their respective affiliates, directly or indirectly, would hold 1,041,735
of such shares with CCM acquiring 771,513 shares of UI common stock from
Xxxxxx and its affiliates prior to the consummation of the Reorganization. In
addition, certain affiliates of CCM (Xxxx Xxxxxx, Xxxx Xxxxxxx and Xxxx
Xxxxxxxx) will exchange 500,000 shares of CSI common stock for 500,000 shares
of UI common stock pursuant to the Agreement. Following the consummation of
the Reorganization, Xxxxxx and its affiliates and CCM and its affiliates would
control, directly or indirectly, 1,541,735 shares of UI common stock. It has
also been agreed that at least $3,000,000 would be raised in the form of
equity from investors (the "Raise") after the consummation of the
Reorganization in accordance with the terms and conditions of the Exhibits B
and C to the Agency Agreement between CSI and Equity Investment Securities,
Inc., a copy of which is attached hereto as Exhibit A (the "Term Sheets");
provided, however, that any debt that is sold on behalf of CSI (and accepted
by CSI prior to such sale) shall be included as part of the Raise; provided,
further, that any debt sold to the Virtual Fund shall not be included as part
of the Raise. To date, none of the $3,000,000 has been raised. Therefore,
CSI and CCM agree as follows:
1. At the closing of the Reorganization, CCM shall deliver 771,513
shares of UI common stock (the "Shares") to Xxxxxxx X. Xxxxxxxxxx,
Esq. ("LWB") to be held in accordance with the terms of this
agreement.
2. Within five (5) days from the date of the Raise being cancelled
because the $3,000,000 was not funded as set forth in the Term
Sheets, CSI shall instruct LWB in writing to return all Shares
held by LWB pursuant to this agreement hereto to UI and LWB shall
return such Shares within three (3) days after the date of such
written notice.
3. Within five (5) days from the date the Gross Proceeds of the
Raise in the amount of at least $3,000,000 are available as
immediately available funds, the escrow agent for the Raise (which
shall be a bank reasonably acceptable to CSI) shall instruct LWB
in writing to deliver all of the Shares held by LWB pursuant
hereto to CCM and LWB shall deliver such Shares within three (3)
days after such written notice. In the event the Gross Proceeds
of the Raise are less than $3,000,000 and CSI elects, in its sole
discretion, to accept said proceeds, the escrow agent (after
notifying CSI that the Gross Proceeds are available as immediately
available funds) shall instruct LWB in writing to deliver all of
the Shares held by LWB pursuant hereto to CCM and LWB shall
deliver such Shares within three (3) days after such written
notice.
4. Any Shares returned to UI pursuant hereto shall be cancelled
without any consideration to CCM and CCM hereby waives any and all
rights with respect to such Shares.
5. In the event the Raise is cancelled due to a material adverse
change in the business of CSI or because the private placement
memo contained an untrue statement of material fact about CSI or
UI or omitted to state a material fact about CSI or UI required to
be stated therein or necessary in order to make the statements
therein not misleading, then CSI shall instruct LWB in writing to
deliver all Shares held by LWB pursuant hereto to CCM and LWB
shall deliver such Shares with three (3) days after such written
notice.
6. All parties agree that any and all Shares held by LWB in
accordance with the terms of this agreement will have full voting
rights and be eligible for all dividends including cash or stock.
In the event LWB has not delivered the Shares to UI or CCM
pursuant hereto and UI is being purchased in whole or part by an
outside entity, CSI shall instruct LWB in writing to deliver all
of the Shares held by LWB pursuant hereto to CCM immediately prior
to the closing of such acquisition and LWB shall so deliver such
Shares within three (3) days after such written notice.
CCM agrees that all shares of UI common stock held by it following the
consummation of the Reorganization, including the Shares, will be subject to
the Lock-up/Leak-out Agreement described in the Agreement.
CCM and CSI agree that each party is responsible for any of the costs, fees or
expenses incurred by it or its affiliates in complying with this agreement or
the Agreement.
LWB, as escrow agent hereunder, shall not be liable to anyone whatsoever by
reason of any error of judgment or for any act done or step taken or omitted
by him in good faith in accordance with the terms of this agreement of for any
mistake of law or for anything which he may do or refrain from doing in
connection herewith unless caused by or arising out of his own gross
negligence or willful misconduct. In the event that any legal action is
instituted against LWB, as escrow agent hereunder, provided that such legal
action does not involve any gross negligence or willful misconduct on the part
of LWB, as escrow agent hereunder, (a) LWB may interplead the parties hereto
in such action and may deposit with the court in which such action is pending
the securities which are the subject of this agreement and which are also the
subject matter of such action, and LWB shall thereupon be relieved of and
discharged from any and all obligations and liabilities as escrow agent under
and pursuant to this agreement in respect of such securities as deposited with
said court; and (b) the parties hereto will indemnify and hold harmless LWB
from and against any and all loss, damage, liability or expense incurred,
arising out of or connected therewith.
If the foregoing is acceptable to you, please indicate your acceptance and
approval by signing in the space provided below on both copies of this letter.
In Witness Whereof, this Agreement has been duly executed by the duly
authorized officers of the parties and the undersigned individuals as of the
11th day of October, 2001.
Very truly yours, ACCEPTED AND APPROVED
CORPORATE CAPITAL MANAGEMENT LLC CASH SYSTEMS, INC.
By:/s/Xxxx Xxxxxx By:/s/Xxxxx Xxxxx
Its: President Its: President
/s/Xxxxxxx X. Xxxxxxxxxx
Xxxxxxx X. Xxxxxxxxxx, Esq.
