ESCROW DEPOSIT AGREEMENT
Exhibit
10.1
THIS
ESCROW AGREEMENT (the “Agreement”)
dated
this ___ day of April, 2006, by and between vFinance Investments, Inc., a
Florida corporation (“vFinance”
or
“Placement
Agent”),
having an address at 000 0xx
Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Sequiam Corporation, a California corporation (the
“Company”),
having an office at 000 Xxxxxxx Xxxx, Xxxxxxx, Xxxxxxx 00000 and SIGNATURE
BANK
(“Signature
Bank”
or
the
“Escrow
Agent”),
a New
York State chartered bank and having an office at, 000 Xxxxxxx Xxxxxx, Xxx
Xxxx,
Xxx Xxxx 00000. Capitalized
terms used but not defined herein shall have the meanings set forth in the
Purchase Agreement referred to in the first recital.
WITNESSETH:
WHEREAS,
pursuant to the terms of a Securities Purchase Agreement, dated on or about
April ___, 2006 (the “Purchase
Agreement”),
the
Company desires to sell (the “Offering”)
a
maximum of, in the aggregate, $3,105,000 (“Maximum
Subscription Amount”)
of
securities of the Company; and
WHEREAS,
unless
the Company consummates the Offering by May 12, 2006 (the “Termination
Date”),
each
Purchaser has the right to terminate its obligations under the Purchase
Agreement; and
WHEREAS,
the
Company and Placement Agent desire to establish an escrow account with the
Escrow Agent into which the Company and Placement Agent shall instruct
purchasers introduced to the Company by Placement Agent (the “Purchasers”)
to
deposit checks and other instruments for the payment of money made payable
to
the order of “Signature Bank as Escrow Agent for Sequiam Corporation” and Escrow
Agent is willing to accept said checks and other instruments for the payment
of
money in accordance with the terms hereinafter set forth; and
WHEREAS,
the
Company and Placement Agent represent and warrant to the Escrow Agent that
they
have not stated to any individual or entity that the Escrow Agent’s duties will
include anything other than those duties stated in this Agreement;
and
WHEREAS,
the
Company and
Placement Agent warrant to the Escrow Agent that a copy of each document that
has been delivered to Purchasers and third parties that include Escrow Agent’s
name and duties, has been attached hereto as Schedule
I.
NOW,
THEREFORE, IT IS AGREED
as
follows:
1. Delivery
of Escrow Funds.
(a)
Placement Agent and the Company shall instruct Purchasers to deliver to Escrow
Agent checks made payable to the order of “Signature Bank, as Escrow Agent for
Sequiam Corporation,” or wire
transfer to Signature Bank, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, ABA
No. 000000000 for credit to Signature Bank, as Escrow Agent for Sequiam
Corporation, Account No.
[__________,
in each
case, with the name, address and social security number or taxpayer
identification number of the individual or entity making payment. In the event
any Purchaser’s address and/or social security number or taxpayer identification
number are not provided to Escrow Agent by the Purchaser, then Placement Agent
and/or the Company agree to promptly provide Escrow Agent with such information
in writing. The checks or wire transfers shall be deposited into a non
interest-bearing account at Signature Bank entitled “Signature Bank, as Escrow
Agent for Sequiam Corporation” (the “Escrow
Account”).
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(b) The
collected funds deposited into the Escrow Account are referred to as the
“Escrow
Funds.”
(c) The
Escrow Agent shall have no duty or responsibility to enforce the collection
or
demand payment of any funds deposited into the Escrow Account. If, for any
reason, any check deposited into the Escrow Account shall be returned unpaid
to
the Escrow Agent, the sole duty of the Escrow Agent shall be to return the
check
to the Purchaser and advise the Company and Placement Agent promptly
thereof.
2. Release
of Escrow Funds.
The
Escrow Funds shall be paid by the Escrow Agent in accordance with the
following:
(a) In
the
event that the Company and Placement Agent advise the Escrow Agent in writing
that the Offering has been terminated (the “Termination
Notice”),
the
Escrow Agent shall promptly return the funds paid by each Purchaser to said
Purchaser without interest or offset.
(b)
The
Escrow Agent shall, upon receipt of written instructions, in the form of
Exhibit
A
attached
hereto or in form and substance satisfactory to the Escrow Agent, received
from
the Company and Placement Agent, pay the Escrow Funds in accordance with such
written instructions, such payment or payments to be made by wire transfer
within one (1) business day of receipt of such written
instructions.
(c) If
by
3:00 P.M. Eastern time on the Termination Date, the Escrow Agent has not
received written instructions from the Company and Placement Agent regarding
the
disbursement of the Escrow Funds, then the Escrow Agent shall promptly return
the Escrow Funds to the Purchasers without interest or offset. The Escrow Funds
returned to each Purchaser shall be free and clear of any and all claims of
the
Escrow Agent.
(d) Following
the distribution of the Escrow Funds by the Escrow Agent in accordance with
(b)
of this Section 2 through the Termination Date, the Escrow Agent shall from
time
to time distribute any additional Escrow Funds, by wire transfer or bank check,
in accordance with written instructions received from the Placement Agent and
the Company in the form of Exhibit
A
or in
form and substance satisfactory to the Escrow Agent received by the Escrow
Agent
no later than 3 P.M. Eastern time on the Termination Date, provided, however,
in
the event that the Offering is oversubscribed, the Placement Agent and the
Company shall deliver written instructions as to the distribution of such
Escrowed Funds in excess of the Maximum Subscription Amount within 3 business
days of the Termination Date.
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(e) The
Escrow Agent shall not be required to pay any uncollected funds or any funds
that are not available for withdrawal.
(f) If
the
Termination Date or any date that is a deadline under this Agreement for giving
the Escrow Agent notice or instructions or for the Escrow Agent to take action
is not a Banking Day, then such date shall be the Banking Day that immediately
preceding that date. A Banking Day is any day other than a Saturday, Sunday
or a
day that a New York State chartered bank is not legally obligated to be opened.
3. Acceptance
by Escrow Agent.
The
Escrow Agent hereby accepts and agrees to perform its obligations hereunder,
provided that:
(a) The
Escrow Agent may act in reliance upon any signature believed by it to be
genuine, and may assume that any person who has been designated by Placement
Agent or the Company to give any written instructions, notice or receipt, or
make any statements in connection with the provisions hereof has been duly
authorized to do so. Escrow Agent shall have no duty to make inquiry as to
the
genuineness, accuracy or validity of any statements or instructions or any
signatures on statements or instructions. The names and true signatures of
each
individual authorized to act singly on behalf of the Company and Placement
Agent
are stated in Schedule
II,
which
is attached hereto and made a part hereof. The Company and Placement Agent
may
each remove or add one or more of its authorized signers stated on Schedule
II
by notifying the Escrow Agent of such change in accordance with this Agreement,
which notice shall include the true signature for any new authorized
signatories.
(b) The
Escrow Agent may act relative hereto in reliance upon advice of counsel in
reference to any matter connected herewith. The Escrow Agent shall not be liable
for any mistake of fact or error of judgment or law, or for any acts or
omissions of any kind, unless caused by its willful misconduct or gross
negligence.
(c) Placement
Agent and the Company agree to indemnify and hold the Escrow Agent harmless
from
and against any and all claims, losses, costs, liabilities, damages, suits,
demands, judgments or expenses (including but not limited to reasonable
attorney’s fees) claimed against or incurred by Escrow Agent arising out of or
related, directly or indirectly, to this Escrow Agreement unless caused by
the
Escrow Agent’s gross negligence or willful misconduct.
(d) In
the
event that the Escrow Agent shall be uncertain as to its duties or rights
hereunder, the Escrow Agent shall be entitled to (i) refrain from taking any
action other than to keep safely the Escrow Funds until it shall be directed
otherwise by a court of competent jurisdiction, or (ii) deliver the Escrow
Funds
to a court of competent jurisdiction.
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(e) The
Escrow Agent shall have no duty, responsibility or obligation to interpret
or
enforce the terms of any agreement other than Escrow Agent’s obligations
hereunder, and the Escrow Agent shall not be required to make a request that
any
monies be delivered to the Escrow Account, it being agreed that the sole duties
and responsibilities of the Escrow Agent shall be to the extent not prohibited
by applicable law (i) to accept checks or other instruments for the payment
of
money and wire transfers delivered to the Escrow Agent for the Escrow Account
and deposit said checks and wire transfers into the non-interest bearing Escrow
Account, and (ii) to disburse or refrain from disbursing the Escrow Funds as
stated above, provided that the checks received by the Escrow Agent have been
collected and are available for withdrawal.
4. Resignation
and Termination of the Escrow Agent.
The
Escrow Agent may resign at any time by giving 30 days’ prior written notice of
such resignation to Placement Agent and the Company. Upon providing such notice,
the Escrow Agent shall have no further obligation hereunder except to hold
as
depositary the Escrow Funds that it receives until the end of such 30-day
period. In such event, the Escrow Agent shall not take any action, other than
receiving and depositing Purchasers checks and wire transfers in accordance
with
this Agreement, until the Company has designated a banking corporation, trust
company, attorney or other person as successor. Upon receipt of such written
designation signed by Placement Agent and the Company, the Escrow Agent shall
promptly deliver the Escrow Funds to such successor and shall thereafter have
no
further obligations hereunder. If such instructions are not received within
30
days following the effective date of such resignation, then the Escrow Agent
may
deposit the Escrow Funds held by it pursuant to this Agreement with a clerk
of a
court of competent jurisdiction pending the appointment of a successor. In
either case provided for in this paragraph, the Escrow Agent shall be relieved
of all further obligations and released from all liability thereafter arising
with respect to the Escrow Funds.
5. Termination.
The
Company and Placement Agent may terminate the appointment of the Escrow Agent
hereunder upon written notice specifying the date upon which such termination
shall take effect, which date shall be at least 30 days from the date of such
notice. In the event of such termination, the Company and Placement Agent shall,
within 30 days of such notice, appoint a successor escrow agent and the Escrow
Agent shall, upon receipt of written instructions signed by the Company and
Placement Agent, turn over to such successor escrow agent all of the Escrow
Funds; provided,
however,
that if
the Company and Placement Agent fail to appoint a successor escrow agent within
such 30-day period, such termination notice shall be null and void and the
Escrow Agent shall continue to be bound by all of the provisions hereof. Upon
receipt of the Escrow Funds, the successor escrow agent shall become the escrow
agent hereunder and shall be bound by all of the provisions hereof and Signature
Bank shall be relieved of all further obligations and released from all
liability thereafter arising with respect to the Escrow Funds and under this
Agreement.
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6. Investment.
All
funds received by the Escrow Agent shall be invested only in non-interest
bearing bank accounts at Signature Bank.
7. Compensation.
Escrow
Agent shall be entitled, for the duties to be performed by it hereunder, to
a
fee of $2,500, which fee shall be paid by the Company upon the signing of this
Agreement. In addition, the
Company shall be obligated to reimburse Escrow Agent for all fees, costs and
expenses incurred or that become due in connection with this Agreement or the
Escrow Account, including reasonable attorney’s fees. Neither the modification,
cancellation, termination or rescission of this Agreement nor the resignation
or
termination of the Escrow Agent shall affect the right of Escrow Agent to retain
the amount of any fee which has been paid, or to be reimbursed or paid any
amount which has been incurred or becomes due, prior to the effective date
of
any such modification, cancellation, termination, resignation or rescission.
To
the extent the Escrow Agent has incurred any such expenses, or any such fee
becomes due, prior to any closing, the Escrow Agent shall advise the Company
and
the Company shall direct all such amounts to be paid directly at any such
closing.
8. Notices.
All
notices, requests, demands and other communications required or permitted to
be
given hereunder shall be in writing and shall be deemed to have been duly given
if sent by hand-delivery, by facsimile (followed by first-class mail), by
nationally recognized overnight courier service or by prepaid registered or
certified mail, return receipt requested, to the addresses set forth
below:
If
to
Placement Agent:
vFinance
Investments, Inc.
000
Xxxxx
Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxxxxx Xxxx
Fax:
(000) 000 0000
If
to the
Company:
Sequiam
Corporation
000
Xxxxxxx Xxxx
Xxxxxxx,
XX 00000
Attention:
Xxxx X. Xxxxxxxxxxx
Fax:
(000) 000-0000
If
to
Escrow Agent:
Signature
Bank
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx
Xxxxxx, Senior Vice President
Fax:
(000) 000-0000
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9. General.
(a) This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the State of New York applicable to agreements made and to be entirely
performed within such State, without regard to choice of law
principles.
(b) This
Agreement sets forth the entire agreement and understanding of the parties
with
respect to the matters contained herein and supersedes all prior agreements,
arrangements and understandings relating thereto.
(c) All
of
the terms and conditions of this Agreement shall be binding upon, and inure
to
the benefit of and be enforceable by, the parties hereto, as well as their
respective successors and assigns.
(d) This
Agreement may be amended, modified, superseded or canceled, and any of the
terms
or conditions hereof may be waived, only by a written instrument executed by
each party hereto or, in the case of a waiver, by the party waiving compliance.
The failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect its right at a later time to enforce
the same. No waiver of any party of any condition, or of the breach of any
term
contained in this Agreement, whether by conduct or otherwise, in any one or
more
instances shall be deemed to be or construed as a further or continuing waiver
of any such condition or breach or a waiver of any other condition or of the
breach of any other term of this Agreement. No party may assign any rights,
duties or obligations hereunder unless all other parties have given their prior
written consent.
(e) If
any
provision included in this Agreement proves to be invalid or unenforceable,
it
shall not affect the validity of the remaining provisions.
(f) This
Agreement and any modification or amendment of 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.
10. Form
of Signature.
The
parties hereto agree to accept a facsimile transmission copy of their respective
actual signatures as evidence of their actual signatures to this Agreement
and
any modification or amendment of this Agreement; provided,
however,
that
each party who produces a facsimile signature agrees, by the express terms
hereof, to place, promptly after transmission of his or her signature by fax,
a
true and correct original copy of his or her signature in overnight mail to
the
address of the other party.
******************************
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IN
WITNESS WHEREOF,
the
parties have duly executed this Agreement as of the date first set forth
above.
| SEQUIAM CORPORTION | VFINANCE INVESTMENTS, INC. | ||||
| By: | By: | ||||
| Name: Title: |
Name: Title: |
||||
| SIGNATURE BANK | ||||
| By: | ||||
| Name: Title: |
||||
| By: | ||||
| Name: Title: |
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Schedule
I
OFFERING
DOCUMENTS
Purchase
Agreement and all exhibits and schedules thereto.
8
Schedule
II
The
Escrow Agent is authorized to accept instructions signed or believed by the
Escrow Agent to be signed by any one of the following on behalf of the Company
and Placement Agent.
Sequiam
Corporation
| Name | True Signature | ||
vFinance
Investments, Inc.
| Name | True Signature | ||
9
Exhibit
A
INSTRUCTIONS
TO DISBURSE ESCROW FUNDS
Date:
SIGNATURE
BANK
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
X.X. 00000
Attn:
Xxxxx Xxxxxx, Senior Vice President
Dear
Xx.
Xxxxxx:
In
accordance with the terms of paragraph 2(_) of an Escrow Deposit Agreement
dated
April ___, 2006, by and among Sequiam Corporation (the “Company”), vFinance
Investments, Inc. (“Placement Agent”), and Signature Bank (the “Escrow Agent”),
the Company and Placement Agent hereby notifies the Escrow Agent that
the
________ closing will be held on April ___, 2006 for gross proceeds of
$_________.
PLEASE
DISTRIBUTE FUNDS BY WIRE TRANSFER OR CHECK OR TRANSFER AS FOLLOWS (wire
instructions attached if applicable):
| Sequiam Corporation | $ |
| vFinance Investments, Inc | $ |
| $ |
Very
truly yours,
Sequiam
Corporation
By:_____________
Name:__________
Title:____________
vFinance
Investments, Inc.
By:_____________
Name:___________
Title:____________
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