Exhibit 10.2
ESCROW AGREEMENT
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THIS AGREEMENT is made and entered into as of the 11th day of
November, 2002, by and between Xxxxxxx X. Xxxxxx, Xx., P.C., an Oklahoma
professional corporation (the "Escrow Agent") and ITS Networks Inc., a Florida
corporation ("ITS") and certain shareholders of Teleconnect Communicaciones,
S.A., a company organized under the laws of Spain ("Teleconnect"), collectively,
the "Parties".
W I T N E S S E T H:
WHEREAS, ITS has entered into a Share Exchange Agreement (the
"Agreement") with certain shareholders of Teleconnect involving an exchange of
up to 3,000,000 shares of the Common Stock of ITS for all of the ordinary stock
of Teleconnect under the terms and conditions of a their Agreement dated
November 11, 2002, which is incorporated by reference herein. ITS and the
shareholders of Teleconnect desire to escrow the shares of Common Stock of ITS
to be issued to the shareholders of Teleconnect in accordance with the
provisions of the Agreement and of the provisions of this Escrow Agreement.
WHEREAS, the Escrow Agent has consented to act as escrow depository
and hold the shares of Common Stock of ITS to be deposited pursuant thereto, in
escrow for ITS and the various shareholders of Teleconnect upon the terms of the
Agreement and the terms hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing, it is hereby agreed
as follows:
1. Establishment of Escrow Account. The parties hereby establish
an escrow account with the Escrow Agent, which escrow account shall be entitled
"ITS-Teleconnect Escrow Account" (the "Escrow Account"). No cash will be
accepted by the Escrow Agent.
2. Escrow Period. The "Escrow Period" shall begin on November 11,
2002, and shall terminate upon the earlier to occur of the following dates:
A. On May 12, 2005; or
B. The date upon which ITS directs the Escrow Agent to release all
of the stock certificates of ITS being held by the Escrow Agent to the
designated former shareholders of Teleconnect.
3. Deposits into the Escrow Account. ITS will request each
stockholder of Teleconnect to transfer, assign and deliver all their stock
certificates of Teleconnect to the Escrow Agent for transfer to ITS. All stock
of Teleconnect so deposited in the Escrow Account are hereinafter referred to as
the "Teleconnect Stock".
ITS will issue and deposit into the Escrow Account 3,000,000 shares of
its Common Stock, with restrictive legends, in the names of the shareholders of
Teleconnect.
4. Disbursement of Common Stock of ITS. Upon written notice from
ITS of the compliance of Teleconnect shareholders with the terms of the
Agreement, the Escrow Agent shall release stock certificates representing shares
of the Common Stock of ITS, as adjusted pursuant to 2.2 and ______ of the
Agreement and Schedule IV to the Agreement, approximately as follows:
a) The Escrow Agent shall deliver on May 12, 2003, 10% of the shares
to be transferred, comprised of approximately 300,000 ITS shares;
b) The Escrow Agent shall deliver on May 12, 2004, 25% of the shares
to be transferred, comprised of approximately 750,000 ITS shares;
and
c) The Escrow Agent shall deliver on May 12, 2005, 65% of the shares
to be transferred, comprised of approximately 1,950,000 ITS
shares.
5. Compensation of Escrow Agent. ITS shall pay the Escrow Agent a
fee of $2,000.
6. Liability of Escrow Agent. Nothing herein contained shall be
deemed to obligate the Escrow Agent to transfer any stock hereunder unless the
same has been first received by the Escrow Agent pursuant to the provisions of
this Agreement. The Escrow Agent acts hereunder as depository only, and is not
responsible or liable in any manner for the sufficiency, correctness,
genuineness or validity of any instrument deposited with it hereunder, or with
respect to the form or execution of the same, or the identity, authority, or
right of any person executing or depositing or receiving the same. The Escrow
Agent shall have no duty or obligation to collect any stock certificates at any
time due and shall not be responsible for any defaults thereunder or hereunder
by any other party or for the application of any stock certificates received by
it as herein provided. The Escrow Agent shall use reasonable care but shall not
be liable for the default or misconduct of any agent or attorney appointed by it
who it has been selected with reasonable care. The Escrow Agent shall be fully
protected with respect to any action taken or suffered under this Agreement in
good faith by it, except for gross negligence and willful misconduct. The
Escrow Agent may consult with counsel for ITS, and shall be fully protected in
respect to any action taken or suffered under the Agree-ment, in good faith by
it in accordance with the opinion of such counsel. The Escrow Agent shall not
be bound or in any way affected by any notice of any modification, cancellation,
abrogation or rescission of this Agreement, or of any fact or circumstance
affecting or alleged to affect the rights or liabilities of the Parties hereto
other than as set forth in this Agreement or affecting or alleged to affect the
rights or liabilities of any other persons, unless notified in writing by all
the Parties to this Agreement, and by all such other persons; nor, in the case
of a modification, unless such modification shall be satisfactory to the Escrow
Agent. The Escrow Agent shall not be liable for actions taken in compliance
with the instructions contained in written notices received by it from ITS or
Teleconnect shareholders.
7. Resolution of Disputes. In the event of any disagreement
between or among the Escrow Agent, ITS, any Teleconnect shareholders, or any
other person, resulting in adverse claims and demands being made in connection
with or for any documents, money or property involved herein, or affected
hereby, the Escrow Agent shall be entitled to refuse to comply with any demand
or claim, so long as such disagreement shall continue, and in so refusing to
make any delivery or other disposition of any documents, money or property
involved or affected hereby, the Escrow Agent shall not be or become liable to
ITS, or any Teleconnect shareholders for its refusal to comply with such
conflicting or adverse demands, and the Escrow Agent shall be entitled to refuse
and refrain to act until:
a). All differences shall have been resolved by written agreement and
the Escrow Agent shall have been notified thereof in writing,
signed by all the parties interested; or
b). The rights of the adverse claimants shall have been fully
adjudicated in a court assuming and having jurisdiction of the
Parties and documents, money and property involved herein or
affected hereby. The Escrow Agent is hereby given the right to
bring an action in interpleader in such a court to resolve the
rights of the adverse claimants to the documents, money and
property deposited with it pursuant to this Agreement. Any
attorney fees and costs incurred by the Escrow Agent regarding
such interpleader action will be paid by ITS or reimbursed to the
Escrow Agent by ITS.
8. Books and Records. The Escrow Agent shall keep accurate books
and records of all transactions hereunder at its offices in Oklahoma City,
Oklahoma. ITS and the Teleconnect shareholders and their representatiaves shall
have full access to such books and records during the business hours of the
Escrow Agent.
10. Fees and Expenses. The Escrow Agent shall be paid fees in
accordance with paragraph 6 hereof upon the execution of this Escrow Agreement.
The Escrow Agent shall be reimbursed by ITS for any out-of-pocket expenses,
excluding incidental charges. It is agreed that additional compensa-tion shall
be paid to the Escrow Agent by ITS for any extraordi-nary services it shall be
requested to render hereunder.
11. Notices. All notices sent pursuant to this Agreement shall be
in writing, signed by the party sending the notice, and shall be sent by first
class mail, postage prepaid, by fax or by hand delivery to the recipient. For
the purposes of this Agreement, notices shall be sent to the parties at the
following addresses:
Escrow Agent: Xxxxxxx X. Xxxxxx, Xx., P.C.
2440 Bank One Center
000 X. Xxxxxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Contact Person: Xxxxxxx X. Xxxxxx, Xx.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
ITS: ITS Networks Inc.
X/Xxxxxxxxxx 00, 0xx Xxxxx
0000 Xxxxxx, Xxxxx
Telephone: 000-00-00-000-0000
Fax: 000-00-00-000-0000
All stock certificates released by the Escrow Agent pursuant to this
Agreement shall be sent to ITS at the above-designated address, certified mail,
postage prepaid, by Federal Express or by United Parcel Service, or shall be
hand- delivered to ITS.
12. Facsimile Copies. The parties agree that facsimile copies of
this Agreement and any signatures hereon shall be as legally binding and
enforceable as the original or copy original of this Agreement or any signatures
hereon.
13. Construction. The parties agree that this Agreement shall be
construed in accordance with the laws of the State of Florida and that exclusive
jurisdiction and venue for any controversy, claim or suit arising out of or
connected with this Agreement shall be in the courts located in Oklahoma City,
Oklahoma.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
ITS:
ITS Networks Inc.
By:
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Xxxxxxx Xxxxx Xxxxxxx
ESCROW AGENT:
Xxxxxxx X. Xxxxxx, Xx., P.C.
By:
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Xxxxxxx X. Xxxxxx, Xx., President
Teleconnect Shareholders
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