ESCROW AGREEMENT
Exhibit
10.3
ESCROW
AGREEMENT
THIS
ESCROW AGREEMENT (this “Agreement”)
is
made as of February 7, 2007, by and among United National Film Corporation
(the
“Company”),
1st
BridgeHouse Securities, LLC (“1st
BridgeHouse”)
and
American Stock Transfer and Trust Company (the “Escrow
Agent”).
ARTICLE
I
ESTABLISHMENT
OF THE ESCROW AGENCY AND ESCROW ACCOUNT
1.1. The
parties hereby appoint the Escrow Agent, and the Escrow Agent hereby accepts,
the escrow agency established under this Agreement.
1.2. The
Escrow Agent hereby establishes a separate account to be maintained and held
in
escrow pursuant to and under this Agreement.
1.3. On
the
date hereof, the Company shall cause $750,000 (including any income thereon,
the
“Escrow
Funds”)
to be
transferred to the Escrow Agent.
ARTICLE
II
INVESTMENT
OF ESCROW FUNDS
The
Escrow Agent shall invest the Escrow Funds in an interest bearing bank account
with, or certificate of deposit or time deposits with, maturities of no more
than 30 days issued by, a U.S. commercial bank or such other bank or other
financial institution as it normally holds such funds. All interest earned
on
the Escrow Funds shall be added to and held as part of the Escrow
Funds.
ARTICLE
III
DISBURSEMENTS
FROM ESCROW FUNDS
Upon
the
receipt by 1st
BridgeHouse of a xxxx or statement for fees or expenses in connection with
investor or public relations or securities law compliance, including related
legal fees and legal fees relating to minor post-closing corporate matters
in
the British Virgin Islands, 1st
BridgeHouse shall prepare a release notice in the form attached hereto as
Exhibit
A
(the
“Release
Notice”)
and
deliver such Release Notice to the Escrow Agent. Upon the Escrow Agent’s receipt
of each Release Notice, the Escrow Agent shall disburse the Escrow Funds in
the
amount provided in, and in accordance with, such Release Notice.
ARTICLE
IV
TERMINATION
OF ESCROW AGREEMENT
4.1. This
Escrow Agreement shall terminate upon the earlier of:
(a) the
disbursement of all Escrow Funds in accordance with Article III; or
(b) February
7, 2010.
4.2. In
the
event that this Escrow Agreement is terminated pursuant to Section 4.1(b),
the
Company may request in writing that the Escrow Agent return any remaining Escrow
Funds directly to the Company; thereupon, the Escrow Agent shall return such
remaining Escrow Funds promptly to the Company.
ARTICLE
V
MISCELLANEOUS
5.1. The
Company shall pay the Escrow Agent a one-time fee of $5,000.00 for all services
rendered by the Escrow Agent hereunder.
5.2. For
purposes of U.S. federal and other taxes based on income, the Company shall
be
treated as the owner of the Escrow Funds and shall report all income, if any,
that is earned on, or derived from, the Escrow Funds as its income, in the
taxable year or years in which such income is properly includible and pay any
taxes attributable thereto. The Escrow Agent shall for each appropriate year,
prepare tax reports on Form 1099 as to the Company’s income and deliver the same
to the Company promptly after the calendar year involved.
5.3. No
waiver
or any breach of any covenant or provision herein contained shall be deemed
a
waiver of any preceding or succeeding breach thereof, or of any other covenant
or provision herein contained. No extension of time for performance of any
obligation or act shall be deemed an extension of the time for performance
of
any other obligation or act.
5.4. Any
notice, demand, request, waiver or other communication required or permitted
to
be given hereunder shall be in writing and shall be effective (i) upon hand
delivery by telex (with correct answer back received), telecopy or facsimile
at
the address or number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business
day
during normal business hours where such notice is to be received) or (ii) on
the
second business day following the date of mailing by express courier service,
fully prepaid, addressed to such address, or upon actual receipt of such
mailing, whichever shall first occur. The addresses for such communications
shall be:
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|
If
to the Company:
|
United
National Film Corporation
c/o
Wuhan Blower Co., Ltd.
Canglongdao
Science Park of Wuhan
East
Lake Hi-Tech Development Zone
Wuhan,
Hubei 430200
People’s
Republic of China
Attention:
Xx Xxx
Tel.
No.: (00) 000 0000 0000
Fax
No.: (00) 000 0000 0000
|
|
with
copies to:
|
Xxxxxxxx
Xxxxxxx LLP
The
Chrysler Building
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Xxxxx X. Xxxxxxx, Esq.
Tel.
No.: (000) 000-0000
Fax
No.: (000) 000-0000
|
|
If
to 0xx
XxxxxxXxxxx:
|
0xx
XxxxxxXxxxx Securities, LLC
000
Xxxxxx Xxxxx Xxxx
Xxxxxxxxx,
Xxxxxxxxxxx 00000
Attention:
Xxxx X. Xxxxx
Tel.
No.: 0 000 000 0000
Fax
No.: 0 000 000 0000
|
|
If
to the Escrow Agent:
|
American
Stock Transfer & Trust Company
00
Xxxxxx Xxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Xxxxxxx X. Xxxxxx
Tel.
No.: (000) 000-0000
Fax
No.: (000) 000-0000
|
Any
party
hereto may from time to time change its address for notices by giving at least
ten (10) days written notice of such changed address to the other party
hereto.
5.5. This
Escrow Agreement shall be binding upon and shall inure to the benefit of the
permitted successors and permitted assigns of the parties hereto.
5.6. This
Escrow Agreement is the final expression of, and contains the entire agreement
between, the parties with respect to the subject matter hereof and supersedes
all prior understandings with respect thereto. This Escrow Agreement may not
be
modified, changed, supplemented or terminated, nor may any obligations hereunder
be waived, except by written instrument signed by the parties to be charged
or
by its agent duly authorized in writing or as otherwise expressly permitted
herein.
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5.7. Whenever
required by the context of this Escrow Agreement, the singular shall include
the
plural and masculine shall include the feminine. This Escrow Agreement shall
not
be construed as if it had been prepared by one of the parties, but rather as
if
both parties had prepared the same. Unless otherwise indicated, all references
to Articles or Sections are to this Escrow Agreement.
5.8. The
parties hereto expressly agree that this Escrow Agreement shall be governed
by,
interpreted under and construed and enforced in accordance with the laws of
the
State of New York, without regard to conflicts of law principles that would
result in the application of the substantive laws of another jurisdiction.
Any
action to enforce, arising out of, or relating in any way to, any provisions
of
this Escrow Agreement shall only be brought in a state or Federal court sitting
in New York City, Borough of Manhattan.
5.9. The
Escrow Agent’s duties hereunder may be altered, amended, modified or revoked
only by a writing signed by each of the parties hereto.
5.10. The
Escrow Agent shall be obligated only for the performance of such duties as
are
specifically set forth herein and may rely and shall be protected in relying
or
refraining from acting on any instrument reasonably believed by the Escrow
Agent
to be genuine and to have been signed or presented by the proper party or
parties. The Escrow Agent shall not be personally liable for any act the Escrow
Agent may do or omit to do hereunder as the Escrow Agent while acting in good
faith and in the absence of gross negligence, fraud or willful misconduct,
and
any act done or omitted by the Escrow Agent pursuant to the advice of the Escrow
Agent’s attorneys-at-law shall be conclusive evidence of such good faith, in the
absence of gross negligence, fraud or willful misconduct.
5.11. The
Escrow Agent is hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only orders or process of courts of law and is hereby expressly
authorized to comply with and obey orders, judgments or decrees of any court.
In
case the Escrow Agent obeys or complies with any such order, judgment or decree,
the Escrow Agent shall not be liable to any of the parties hereto or to any
other person, firm or corporation by reason of such decree being subsequently
reversed, modified, annulled, set aside, vacated or found to have been entered
without jurisdiction.
5.12. The
Escrow Agent shall not be liable in any respect on account of the identity,
authorization or rights of the parties executing or delivering or purporting
to
execute or deliver any documents or papers deposited or called for thereunder
in
the absence of gross negligence, fraud or willful misconduct.
5.13. The
Escrow Agent’s responsibilities as escrow agent hereunder shall terminate if the
Escrow Agent shall resign by giving written notice to the Company and
1st
BridgeHouse. In the event of any such resignation, 1st
BridgeHouse and the Company shall appoint a successor Escrow Agent and the
Escrow Agent shall deliver to such successor Escrow Agent any Escrow Funds
and
other documents held by the Escrow Agent.
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5.14. If
the
Escrow Agent reasonably requires other or further instruments in connection
with
this Escrow Agreement or obligations in respect hereto, the necessary parties
hereto shall join in furnishing such instruments.
5.15. It
is
understood and agreed that should any dispute arise with respect to the delivery
and/or ownership or right of possession of the documents or the Escrow Funds
held by the Escrow Agent hereunder, the Escrow Agent is authorized and directed
in the Escrow Agent’s sole discretion (i) to retain in the Escrow Agent’s
possession without liability to anyone all or any part of said documents or
the
Escrow Funds until such disputes shall have been settled either by mutual
written agreement of the parties concerned by a final order, decree or judgment
or a court of competent jurisdiction after the time for appeal has expired
and
no appeal has been perfected, but the Escrow Agent shall be under no duty
whatsoever to institute or defend any such proceedings or (ii) to deliver the
Escrow Funds and any other property and documents held by the Escrow Agent
hereunder to a state or Federal court having competent subject matter
jurisdiction and located in the City of New York, Borough of Manhattan, in
accordance with the applicable procedure therefor.
5.16. The
Company agrees to indemnify and hold harmless the Escrow Agent and its partners,
employees, agents and representatives from any and all claims, liabilities,
costs or expenses in any way arising from or relating to the duties or
performance of the Escrow Agent hereunder other than any such claim, liability,
cost or expense to the extent the same shall have been determined by final,
unappealable judgment of a court of competent jurisdiction to have resulted
from
the gross negligence, fraud or willful misconduct of the Escrow
Agent.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day
and year first written above.
| UNITED NATIONAL FILM CORPORATION | ||
| By: | /s/ Xx Xxx | |
|
Name:
Xx Xxx
Title:
President and Chief Executive Officer
|
||
| 1ST BRIDGEHOUSE SECURITIES, LLC | ||
| By: | /s/ Xxxx X. Xxxxx | |
| Name: Xxxx X. Xxxxx | ||
| Title: Executive Vice-President | ||
| ESCROW AGENT: | ||
| AMERICAN STOCK TRANSFER AND TRUST COMPANY | ||
| By: | /s/ Xxxxxxx X. Xxxxxx | |
|
Name:
Xxxxxxx X. Xxxxxx
Title:
Vice President
|
||
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Exhibit
A
to
Escrow
Agreement
RELEASE
NOTICE
Pursuant
to the Escrow Agreement, dated as of February 7, 2007 (the “Escrow
Agreement”),
by
and among United National Film Corporation, 1st
BridgeHouse Securities, LLC (“1st
BridgeHouse”)
and
American Stock Transfer and Trust Company (the “Escrow
Agent”),
1st
BridgeHouse hereby instructs the Escrow Agent to release Escrow Funds in
accordance with the following instructions:
|
Recipient
of
Escrow
Funds
|
Amount
of Escrow Funds
to
be Disbursed
|
Date
of
Disbursement
|
Transfer
Instructions
|
Capitalized
terms used herein and not defined shall have the meanings ascribed to such
terms
in the Escrow Agreement.
|
1ST
BRIDGEHOUSE SECURITIES, LLC
|
||
| By: | __________________________ | |
| Name: | ||
| Title: | ||
|
Date:
|
__________________________ | |
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