ESCROW AGREEMENT
AGREEMENT made as of the
22nd
day of October 2007 by and between JB Clothing Corporation (“Issuer”), and the
Law Offices of Xxxxxx X. Xxxxxxx, 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxx,
Xxxxxxxxxx 00000 (the “Escrow Agent”)
WITNESSETH
WHEREAS, the Issuer proposes
to establish with the Escrow Agent an escrow account (the “Escrow Account”), to
which subscription monies which are received by the Escrow Agent from the Issuer
in connection with such public offering are to be credited, and the Escrow Agent
is willing to establish the Escrow Account on the terms and subject to the
conditions hereinafter set forth; and
WHEREAS, the Escrow Agent has
an agreement with Washington Mutual Bank or such other bank as selected by the
Escrow Agent and reasonably acceptable to the Issuer to establish a special bank
account (the “Bank Account”) into which the subscription monies, which are
received by the Escrow Agent from the Issuer and credited to the Escrow Account,
are to be deposited;
NOW, THEREFORE, in
consideration of the premises and mutual covenants herein contained, the parties
hereto hereby agree as follows:
1. Information
Sheet. Each capitalized term not otherwise defined in this
Agreement shall have the meaning set forth for such term on the information
sheet which is attached to this Agreement and is incorporated by reference
herein and made a part hereof (the “Information Sheet”).
2. Establishment of the Bank
Account.
2.1 The
Escrow Agent shall establish a non-interest bearing bank account at the branch
of Washington Mutual Bank or such other bank as selected by the Escrow Agent and
reasonably acceptable to the Issuer, and bearing the title set forth on the
Information Sheet (heretofore defined as the “Bank Account”). The
purpose of the Bank Account is for (a) the deposit of all subscription monies
(checks, cash or wire transfers) which are received by the Issuer from
prospective purchasers of the Securities and are delivered by the Issuer to the
Escrow Agent, (b) the holding of amounts of subscription monies which are
collected through the banking system, and (c) the disbursement of collected
funds, all as described herein.
2.2 The
Offering Period, which shall be deemed to commence on the date set forth in the
Issuer’s Prospectus to be supplied to the Escrow Agent and to terminate on the
date set forth on the Information Sheet. The last day of the Offering
Period, or the last day of the Extension Period (if the Escrow Agent has
received written notice thereof as hereinabove provided), is referred to herein
as the “Termination Date.” Except as provided in Section 4.3 hereof,
after the Termination Date, the Issuer shall not deposit, and the Escrow Agent
shall not accept, any additional amounts representing payments by prospective
purchasers.
3. Deposits to the Bank
Account.
3.1 The
Issuer shall promptly deliver to the Escrow Agent all monies which it receives
from prospective purchasers of the Securities, which monies shall be in the form
of checks, cash, or wire transfers. Upon the Escrow Agent’s receipt
of such monies, they shall be credited to the Escrow Account. All
checks delivered to the Escrow Agent shall be made payable to “Law Offices of
Xxxxxx X. Xxxxxxx, Escrow Agent f/b/o JB Clothing Corporation” Any
check payable other than to the Escrow Agent as required hereby shall be
returned to the Issuer, by noon of the next business day following receipt of
such check by the Escrow Agent, and such check shall be deemed not to have been
delivered to the Escrow Agent pursuant to the terms of this
Agreement.
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3.2 Promptly
after receiving subscription monies as described in Section 3.1, the Escrow
Agent shall deposit the same into the Bank Account. Amounts of monies
so deposited are hereinafter referred to as “Escrow Amounts.” The
Escrow Agent shall cause Washington Mutual Bank to process all Escrow Amounts
for collection through the banking system. Simultaneously with each
deposit to the Escrow Account, the Issuer shall inform the Escrow Agent in
writing of the name and address of the prospective purchaser, the amount of
Securities subscribed for by such purchaser, and the aggregate dollar amount of
such subscription (collectively the “Subscription Information”).
3.3 The
Escrow Agent shall not be required to accept for credit to the Escrow Account or
for deposit into the Bank Account checks which are not accompanied by the
appropriate Subscription Information. Wire transfers and cash
representing payments by prospective purchasers shall not be deemed deposited in
the Escrow Account until the Escrow Agent has received in writing the
Subscription Information required with respect to such payments.
3.4 The
Escrow Agent shall not be required to accept in the Escrow Account any amounts
representing payments by prospective purchasers, whether by check, cash or wire,
except during the Escrow Agent’s regular business hours.
3.5 Only
those Escrow Amounts, which have been deposited in the Bank Account and which
have cleared the banking system and have been collected by the Escrow Agent, are
herein referred to as the “Fund.”
3.6 If
the proposed offering is terminated before the Termination Date, the Escrow
Agent shall refund any portion of the Fund prior to disbursement of the Fund in
accordance with Article 4 hereof upon instructions in writing signed by the
Issuer.
4. Disbursement from the Bank
Account.
4.1 Subject
to 4.3 below, if by the close of regular banking hours on the Termination Date
the Escrow Agent determines that the amount in the Fund is less than the Minimum
Dollar Amount or the Minimum Securities Amount, as indicated by the Subscription
Information submitted to the Escrow Agent, then in either such case, the Escrow
Agent shall promptly refund to each prospective purchaser the amount of payment
received from such purchaser which is then held in the Fund or which thereafter
clears the banking system, without interest thereon or deduction therefrom, by
drawing checks on the Bank Account for the amounts of such payments and
transmitting them to the purchasers. In such event, the Escrow Agent
shall promptly notify the Issuer of its distribution of the Fund.
4.2 Subject
to 4.3 below, if at any time up to the close of regular banking hours on the
Termination Date, the Escrow Agent determines that the amount in the Fund is at
least equal to the Minimum Dollar Amount and represents the sale of not less
than the Minimum Securities Amount, the Escrow Agent shall promptly notify the
Issuer of such fact in writing. The Escrow Agent shall promptly
disburse the Fund, by drawing checks on the Bank Account in accordance with
instruction in writing signed by the Issuer as to the disbursement of the Fund,
promptly after it receives such instructions. In the event that
cleared funds exceed the Minimum Dollar Amount, the Issuer may close on such
excess funds when it closes on the Minimum Dollar Amount or opt to close on such
excess funds at a later date or dates. Such closing(s) may take place
by mutual agreement of the Issuer any time during or after the Offering Period,
as, and if, extended.
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4.3 If
the Escrow Agent has on hand at the close of business on the Termination Date
any uncollected amounts which when added to the Fund would raise the amount in
the Fund to the Minimum Dollar Amount, and result in the Fund representing the
sale of the Minimum Securities Amount, the Collection Period (consisting of the
number of business days set forth on the Information Sheet) shall be utilized to
allow such uncollected amounts to clear the banking system. During
the Collection Period, the Escrow Agent shall not deposit or accept, any
additional amounts; provided, however, that such amounts as were received by the
Issuer by the close of business on the Termination Date may be deposited with
the Escrow Agent by noon of the next business day following the Termination
Date. If at the close of business on the last day of the Collection
Period an amount sufficient to raise the amount in the Fund to the Minimum
Dollar Amount and which would result in the Fund representing the sale of the
Minimum Securities Amount shall not have cleared the banking system, the Escrow
Agent shall promptly notify the Issuer in writing of such fact and shall
promptly return all amounts then in the Fund, and any amounts which thereafter
clear the banking system, to the prospective purchasers as provided in Section
4.1 hereof.
4.4 Upon
disbursement of the Fund pursuant to the terms of this Article 4, the Escrow
Agent shall be relieved of all further obligations and relieved from all
liability under this Agreement. It is expressly agreed and understood
that in no event shall the aggregate amount of payments made by the Escrow Agent
exceed the amount of the Fund.
5. Rights, Duties and
Responsibilities of Escrow Agent. It is understood and agreed
that the duties of the Escrow Agent are purely ministerial in nature, and
that:
5.1 The
Escrow Agent shall notify the Issuer, on a daily basis, of the Escrow Amounts
which have been deposited in the Bank Account and of the amounts, constituting
the Fund, which have cleared the banking system and have been collected by the
Escrow Agent.
5.2 The
Escrow Agent shall not be responsible for or be required to enforce any of the
terms or conditions of any agreement between the Issuer and third parties nor
shall the Escrow Agent be responsible for the performance by the Issuer of its
respective obligations under this Agreement.
5.3 The
Escrow Agent shall not be required to accept from the Issuer any Subscription
Information pertaining to prospective purchasers unless such Subscription
Information is accompanied by checks, cash, or wire transfers meeting the
requirements of Section 3.1, nor shall the Escrow Agent be required to keep
records of any information with respect to payments deposited except as to the
names, addresses and amounts of such payments; however, the Escrow Agent shall
notify the Issuer promptly of any discrepancy between the amount set forth in
any Subscription Information and the amount delivered to the Escrow Agent
therewith. Such amount need not be accepted for deposit in the Escrow
Account until such discrepancy has been resolved.
5.4 The
Escrow Agent shall be under no duty or responsibility to enforce collection of
any check delivered to it hereunder. The Escrow Agent, within a
reasonable time, shall return to the Issuer any check received which is
dishonored, together with Subscription Information, if any, which accompanied
such check.
5.5 The
Escrow Agent shall be entitled to rely upon the accuracy, act in reliance upon
the contents, and assume the genuineness of any notice, instruction,
certificate, signature, instrument or other document which is given to the
Escrow Agent pursuant to this Agreement without the necessity of the Escrow
Agent verifying the truth or accuracy thereof. The Escrow Agent shall
not be obligated to make any inquiry as to the authority, capacity, existence or
identity of any person purporting to give any such notice or instructions or to
execute any such certificate, instrument or other document.
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5.6 If
the Escrow Agent is uncertain as to its duties or rights hereunder or shall
receive instructions with respect to the Bank Account, the Escrow Amounts or the
Fund which, in its sole determination, are in conflict either with other
instructions received by it or with any provision of this Agreement, it shall be
entitled to hold the Escrow Amounts, the Fund, or a portion thereof, in the Bank
Account pending the resolution of such uncertainty to the Escrow Agent’s sole
satisfaction, by final judgment of a court or courts of competent jurisdiction
or otherwise; or the Escrow Agent, at its sole option, may deposit the Fund (and
any other Escrow Amounts that thereafter become part of the Fund) with the Clerk
of a court of competent jurisdiction in a proceeding to which all parties in
interest are joined. Upon the deposit by the Escrow Agent of the Fund
with the Clerk of any such court, the Escrow Agent shall be relieved of all
further obligations and released from all liability hereunder.
5.7 The
Escrow Agent shall not be liable for any action taken or omitted hereunder, or
for the misconduct of any employee, agent or attorney appointed by it, except in
the case of willful misconduct or gross negligence. The Escrow Agent
shall be entitled to consult with counsel of its own choosing and shall not be
liable for any action taken, suffered or omitted by it in accordance with the
advice of such counsel.
5.8 The
Escrow Agent shall have no responsibility at any time to ascertain whether or
not any security interest exists in the Escrow Amounts, the Fund or any part
thereof or to file any financing statement under the Uniform Commercial Code
with respect to the Fund or any part thereof.
6. Amendment;
Resignation. This Agreement may be altered or amended only
with the written consent of the parties hereto. The Escrow Agent (and
any successor escrow agent) at any time may be discharged from its duties and
obligations hereunder by the delivery to it of a notice of termination signed by
the Company, or at any time the Escrow Agent may resign by giving written notice
to such effect to the Issuer. Upon any such termination or
resignation, the Escrow Agent shall deliver the Escrowed Amounts or the Fund to
any successor escrow agent jointly designated by the other parties hereto in
writing, or to any court of competent jurisdiction if no such successor escrow
agent is agreed upon, whereupon the Escrow Agent shall be discharged of and from
any and all further obligations arising in connection with this Escrow
Agreement. The termination of services or resignation of the Escrow
Agent shall take effect on the earlier of (i) the appointment of a successor
(including a court of competent jurisdiction) or (ii) the day that is 30 days
after the date of delivery: (A) to the Escrow Agent of the other parties’ notice
of termination or (B) to the other parties hereto of the Escrow Agent’s written
notice of resignation. If at that time the Escrow Agent has not
received a designation of successor escrow agent, the Escrow Agent’s sole
responsibility after that time shall be to keep the Escrowed Amounts or the Fund
safe until receipt of a designation of a successor escrow agent or a joint
written disposition instruction by the other parties hereto or an enforceable
order of a court of competent jurisdiction. Without limiting the
provisions of Section 8 hereof, the resigning Escrow Agent shall be entitled to
be reimbursed by the Issuer for any expenses incurred in connection with its
resignation, transfer of the Fund to a successor escrow agent or distribution of
the Fund pursuant to this Section 6.
7. Representations and
Warranties. The Issuer hereby represents and warrants to the
Escrow Agent that:
7.1 No
party other than the parties hereto and the prospective purchasers have, or
shall have, any lien, claim or security interest in the Escrow Amounts or the
Fund or any part thereof.
7.2 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 Amounts or the Fund or any part thereof.
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7.3 The
Subscription Information submitted with each deposit shall, at the time of
submission and at the time of the disbursement of the Fund, be deemed a
representation and warranty that such deposit represents a bona fide payment by
the purchaser described therein for the amount of Securities set forth in such
Subscription Information.
7.4 All
of the information contained in the Information Sheet is, as of the date hereof,
and will be, at the time of any disbursement of the Fund, true and
correct.
8. Fees and
Expenses. The Escrow Agent shall be entitled to the Escrow
Agent Fees set forth on the Information Sheet, payable as and when stated
therein. In addition, the Issuer agrees to reimburse the Escrow Agent
for any reasonable expenses incurred in connection with this Agreement,
including but not limited to, reasonable counsel fees. Upon receipt
of the Minimum Dollar Amount, the Escrow Agent shall have a lien upon the Fund
to the extent of its fees for services as Escrow Agent.
9. Indemnification and
Contribution.
9.1 The
Issuer (referred to as the “Indemnitor”) agrees to indemnify the Escrow Agent
and its officers, directors, employees, agents and shareholders (collectively
referred to as the “Indemnitees”) against and hold them harmless of and from,
any and all loss, liability, cost, damage and expense, including without
limitation, reasonable counsel fees, which the Indemnitees may suffer or incur
by reason of any action, claim or proceeding brought against the Indemnitees
arising out of or relating in any way to this Agreement or any transaction to
which this Agreement relates, unless such action claim or proceeding is the
result of the willful misconduct or gross negligence of the
Indemnitees.
9.2 If
the indemnification provided for in Section 9.1 is applicable, but for any
reason is held to be unavailable, the Indemnitor shall contribute such amounts
as are just and equitable to pay, or to reimburse the Indemnitees for, the
aggregate of any and all losses, liabilities, costs, damages and expenses,
including counsel fees, actually incurred by the Indemnitees as a result of or
in connection with, and any such amount paid in settlement of, any action, claim
or proceeding arising out of or relating in any way to any actions or omissions
of the Indemnitor.
9.3 The
provisions of the Article 9 shall survive any termination of this Agreement,
whether by disbursement of the Fund, resignation of the Escrow Agent or
otherwise.
10. Participating
Broker/Dealers.
The Issuer will notify the Escrow Agent
of the names of any participating broker/dealers other than the Issuer and the
Escrow Agent is authorized to accept subscription payments from such
broker/dealers and/or their customers.
11. Governing Law and
Assignment. This Agreement shall be construed in accordance
with and governed by the laws of the State of Nevada and shall be binding upon
the parties hereto and their respective successors and assigns; provided,
however, that any assignment or transfer by any party of its rights under this
Agreement or with respect to the Escrow Amounts or the Fund shall be void as
against the Escrow Agent unless (a) written notice thereof shall be given to the
Escrow Agent; and (b) the Escrow Agent shall have consented in writing to such
assignment or transfer, which consent shall not be unreasonably withheld or
delayed.
12. Notices. All
notices required to be given in connection with this Agreement shall be (a)
delivered by hand or by facsimile (with confirmation of receipt), or (b) sent by
registered or certified mail, or by the Express Mail service offered by the
United States Post Office with proper postage prepaid, and addressed as
follows:
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If to the
Issuer, to:
JB
Clothing Corporation
00
Xxxxxxxxxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxx 00000
Telephone
(000) 000-0000
If to the
Escrow Agent:
Law
Offices of Xxxxxx X. Xxxxxxx
0000
Xxxxxxxx Xxxxxxxxx
Xxxxx
000
Xxxxxxxx,
Xxxxxxxxxx 00000
Telephone
(000) 000-0000
Facsimile
(000) 000-0000
or to
such other address as the person to whom notice is to be given may have
previously furnished to the others in the above-referenced
manner. All such notices and communications, if mailed, shall be
effective, if to the Issuer, five days after deposited in the mails, and if to
the Escrow Agent shall not be effective until received. Notices of
changes of address shall not be effective until received.
13. Severability. If
any provision of this Agreement or the application thereof to any person or
circumstance shall be determined to be invalid or unenforceable, the remaining
provisions of this Agreement or the application of such provision to persons or
circumstances other than those to which it is held invalid or unenforceable
shall not be affected thereby and shall be valid and enforceable to the fullest
extent permitted by law.
14. Execution in Several
Counterparts. This Agreement may be executed in several
counterparts or by separate instruments, and all of such counterparts and
instruments shall constitute one agreement, binding on all of the parties
hereto.
15. Entire
Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings (written or oral) of the
parties in connection therewith.
IN WITNESS WHEREOF, the undersigned
have executed this Agreement as of the day and year first above
written.
JB
CLOTHING CORPORATION
By /s/ Xxxx X.
Xxxxx
Xxxx
X. Xxxxx
President
Law
Offices of Xxxxxx X. Xxxxxxx
By: Xxxxxx X. Xxxxxxx,
Esq.
Xxxxxx
X. Xxxxxxx, Esq.
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ESCROW
AGREEMENT INFORMATION SHEET
1. The
Issuer
Name: JB Clothing
Corporation
Address: 00 Xxxxxxxxxxxx
Xxxxxx
Xxxxxxxxx, Xxxxxx
00000
State of Incorporation:
Nevada
2. The Escrow
Agent
Name: Law
Offices of Xxxxxx X. Xxxxxxx
Address: 0000
Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
3. The
Securities
Description of the Securities to be
offered: Shares of Common Stock
Offering Price per Share: $0.01 per
Share.
4. Minimum
Amount Required for Disbursement of the Escrow Account Aggregate dollar amount
which must be collected before the Escrow Account may be disbursed to the Issuer
(“Minimum Dollar Amount”): $40,000.00.
Total amount of securities which must
be subscribed for before the Escrow Account may be disbursed to the Issuer
(“Minimum Securities Amount”): 4,000,000 Shares of Common Stock.
5. Plan of Distribution of the
Securities
Offering Period: From the date of the
Prospectus until _________________, 2008.
Extension Period, if any:_____________,
200_ through_______________, 200_.
Collection Period, if any: 10 business
days.
6. Title of Bank
Account:
Law Offices of Xxxxxx X. Xxxxxxx Client
Trust Account f/b/o JB Clothing Corporation
7. Escrow Agent
Fees
$1,500.00 upon the distribution of
funds based upon reaching the Minimum Dollar Amount. All other fees
will be mutually agreed upon by the Issuer and the Escrow Agent.
8. Federal I.D.
No.
00-0000000
