AMENDED
STOCK PURCHASE ESCROW AGREEMENT
This AMENDED STOCK PURCHASE ESCROW AGREEMENT (this ?Amended
Agreement?) is dated as of the 25th day of October, 2006, between Xxxxxx
Xxxxxxx Xxxxxxx, P.A., a Florida professional association, as Escrow
Agent (the ?Escrow Agent?), certain stockholders of ProGuard
Acquisition Corp. (?PAC?) listed on Exhibit A (the ?Sellers?), and
Worldwide Security Acquisitions, LLC (?WSA? or the ?Buyer?).
Capitalized terms used but not otherwise defined herein shall have the
meaning ascribed thereto in the Stock Purchase Agreement (as defined
below).
WHEREAS, the Sellers have granted an option of even date herewith
(the ?Option?) to purchase a minimum of seventy four (74%) percent and
a maximum of eighty-seven (87%) percent of the issued and outstanding
capital stock of PAC owned by Sellers (the ?Shares?); and
WHEREAS, the Buyer is willing to deposit the sum of Three Hundred
Thousand ($300,000) Dollars of the aggregate option exercise purchase
price for the Shares in cash in escrow pursuant to this Amended
Agreement and the Sellers are willing to deposit the Shares in escrow
pursuant to this Amended Agreement; and
WHEREAS, the deposit amount, i.e. Three Hundred Thousand
($300,000) Dollars, is and shall be entirely NON-REFUNDABLE under any
circumstances whatsoever; and
WHEREAS, the Sellers and the Buyer wish to continue to engage the
Escrow Agent to act, and the Escrow Agent is willing to continue to
act, as escrow agent hereunder and, in that capacity, to hold and
administer the respective Escrow Funds and Escrow Shares (as defined
below) deposited in escrow hereunder in accordance with, and subject
to, the terms of this Agreement;
NOW THEREFORE, for valuable consideration, the receipt and
sufficiency whereof is hereby acknowledged, the parties hereto agree as
follows:
Section 1. Deposit of Escrow Funds and Escrow Shares.
Within fifteen (15) days of the date of this Agreement (a) each
of the Sellers shall deposit with the Escrow Agent, certificates
evidencing the number of shares (?Escrow Shares?) of PAC?s Common Stock
specified next to their name on Exhibit A hereof under the heading
?Aggregate Number of Shares? and one irrevocable stock power signed in
blank, signature medallion guaranteed, from each Seller covering all
certificates held by such Seller, together with applicable corporate
resolutions authorizing the execution and the delivery of the stock
powers (all such certificates, stock powers and resolutions are
collectively referred to herein as the ?Escrow Shares?) and (b) the
Buyer shall deposit with the Escrow Agent the sum of Three Hundred
Thousand ($300,000.00) Dollars in cash or cash equivalent (the
?Deposit?). Collectively, the Deposit, the balance of the aggregate
Option exercise price and the Escrow Shares, is referred to hereinafter
as (the ?Escrow Property?). The Escrow Agent shall acknowledge receipt
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of the Escrow Property to all parties to this Amended Agreement and
agrees to hold and to administer the Escrow Property in accordance with
the terms of this Amended Agreement.
Section 2. The Cash Escrow.
(a) The Buyer shall deliver the Deposit to the Escrow Agent at and
upon execution of the Amended Agreement. The entire Three Hundred
Thousand ($300,000.00) Dollar Deposit is and shall be non-refundable
under any circumstance whatsoever and shall be delivered by the Escrow
Agent to the Seller for payment of Seller?s costs incurred in
connection with the stock Option purchase and sale upon closing and
completion of the Buyer?s exercise of the Option or upon expiration of
the Term of the Option at 5:00 P.M., EST on January 29, 2007, whichever
shall first occur.
(b) On or prior to January 29, 2007 at 10:00 A.M., EST, the Buyer
shall deposit with the Escrow Agent the full balance of the aggregate
Option exercise price, i.e. a minimum of $1,700,000.00 and a maximum of
$2,050,000.00, in cash or cash equivalent, in cleared funds.
(c) Upon receipt by the Escrow Agent of the full, aggregate Option
exercise price from the Buyer in clear funds, the Escrow Agent shall
notice the parties for closing the exercise of the Option and at
closing shall deliver the cash escrow to the Sellers, pro-rata to their
respective sale of PAC restricted Common Stock to the Buyer, less the
Seller?s expenses of the Option transaction, and deliver the Escrow
Shares certificates and stock powers to the PAC transfer agent with
irrevocable instructions to transfer the Escrow Shares to the Buyer.
(d) In the event that the Buyer shall not have deposited a minimum
cash amount aggregating $2,000,000.00 with the Escrow Agent on or
before January 29, 2007 at 10:00 A.M., EST, the Escrow Agent shall
return all of the Escrow Shares to the Seller and shall return all of
the Cash Escrow, less the sum of $300,000.00, to the Buyer and the
Escrow shall thereafter be terminated forthwith.
Section 3. Releases from Escrow.
(a) Closing. At Closing, subject to the provisions of Section 2.(d),
the Escrow Agent shall (i) deliver the Escrow Funds to the Seller?s
Representative in the form of a check payable to each of the Sellers in
the amount specified next to each Seller?s name under the heading ?Net
Proceeds from Sale? in Exhibit A and (ii) deliver the Escrow Shares to
Cottonwood Stock Transfer, PAC?s transfer agent (the ?Transfer Agent?),
and instruct the Transfer Agent to deliver to the Buyer a certificate
(or certificates as reasonably requested by Buyer in advance)
representing the aggregate number of shares of restricted PAC Common
Stock purchased registered in the name of Buyer (or its designee(s)).
(b) No Closing. If the Option exercise transaction is not closed
for any reason whatsoever by January 29, 2007 at 5:00 P.M. EST, the
Escrow Agent shall return the Escrow Property, less the nonrefundable
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Deposit amount, without interest or further instruction to the
respective sources of the Escrow Property, the nonrefundable Deposit
shall be delivered to the Sellers? Representative and the Escrow Agent
shall thereafter terminate the Escrow forthwith.
(c) Joint Written Instruction. Except as provided in Sections
3(b), 3(c) and 3(d), the Escrow Agent shall hold the Escrow Property in
escrow until the receipt by the Escrow Agent of a notice, executed by
both the Sellers? Representative and the Buyer, directing the
disposition of the Escrow Property. The Escrow Agent shall not follow
instructions relating to the disposition of the Escrow Property
executed only by the Buyer or return the refundable portion of the
Escrow Funds to the Buyer without the Sellers? Representative?s prior
written consent.
(d) Dispute. If the Escrow Agent, prior to delivering, or causing
to be delivered, any of the Escrow Property in accordance herewith,
receives notice of objection, dispute, or other assertion in accordance
with any of the provisions of this Amended Agreement, the Escrow Agent
shall continue to hold the Escrow Property until such time as the
Escrow Agent shall receive (i) written instructions jointly executed by
the Sellers? Representatives and the Buyer, directing distribution of
the Escrow Property, (ii) written instructions from the Sellers?
Representative requesting deposit of the Escrow Property with a court
of competent jurisdiction in Broward County, Florida or (iii) a
certified copy of a judgment, order or decree of a court of competent
jurisdiction in Broward County, Florida, final beyond the right of
appeal, directing the Escrow Agent to distribute said Escrow Property
to any party hereto or as such judgment, order or decree shall
otherwise specify (including any such order directing the Escrow Agent
to deposit the Escrow Property into the court rendering such order,
pending determination of any dispute between any of the parties). In
addition, the Escrow Agent shall have the right to deposit the Escrow
Property with a court of competent jurisdiction in Broward County,
Florida without liability to any party if said dispute is not resolved
within thirty (30) days of receipt of any such notice of objection,
dispute or otherwise and the escrow shall thereafter terminate.
Section 4. Duties and Obligations of the Escrow Agent.
(a) The parties hereto agree that the duties and obligations of
the Escrow Agent are only such as are herein specifically provided and
no other. The Escrow Agent?s duties are as a depositary only, and the
Escrow Agent shall incur no liability whatsoever, except as a direct
result of the Escrow Agent?s willful misconduct or gross negligence.
(b) The Escrow Agent may consult with counsel of its choice, and
shall not be liable for any action taken, suffered or omitted by them
in accordance with the advice of such counsel.
(c) The Escrow Agent shall not be bound in any way by the terms of
any other agreement to which the Sellers and the Buyer are parties,
whether or not it has knowledge thereof, and the Escrow Agent shall not
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in any way be required to determine whether or not any other agreement
has been complied with by the Sellers and the Buyer, or any other party
thereto. The Escrow Agent shall not be bound by any modification,
amendment, termination, cancellation, rescission or supersession of
this Agreement unless the same shall be in writing and signed jointly
by each of the Sellers and the Buyer, and agreed to in writing by the
Escrow Agent.
(d) If the Escrow Agent shall be uncertain as to its duties or
rights hereunder or shall receive instructions, claims or demands
which, in its opinion, are in conflict with any of the provisions of
this Agreement, it shall be entitled to refrain from taking any action,
other than to keep safely all property held in escrow, until it shall
jointly be directed otherwise in writing by the Sellers and the Buyer
or by a final judgment (non-appealable) of a court of competent
jurisdiction.
(e) The Escrow Agent shall be fully protected in relying upon any
written notice, demand, certificate or document which it, in good
faith, believes to be genuine. The Escrow Agent shall not be
responsible for the sufficiency or accuracy of the form, execution,
validity or genuineness of documents or securities now or hereafter
deposited hereunder, or of any endorsement thereon, or for any lack of
endorsement thereon, or for any description therein; nor shall the
Escrow Agent be responsible or liable in any respect on account of the
identity, authority or rights of the persons executing or delivering or
purporting to execute or deliver any such document, security or
endorsement.
(f) The Escrow Agent shall not be required to institute legal
proceedings of any kind and shall not be required to defend any legal
proceedings, which may be instituted against it or in respect of the
Escrow Property.
(g) If the Escrow Agent, at any time, in its sole discretion,
deems it necessary or advisable to relinquish custody of any of the
Escrow Property, it may do so by delivering the same to any other
escrow agent mutually agreeable to the Sellers and the Agent and, if no
such escrow agent shall be selected within three days of the Escrow
Agent's notification to the Sellers and the Buyer of its desire to so
relinquish custody of the Escrow Property, then the Escrow Agent may do
so by delivering the Escrow Property to the clerk or other proper
officer of any court of competent jurisdiction in Broward County,
Florida. The fee of any such court officer shall be shared equally by
the parties hereto (other than the relinquishing Escrow Agent). Upon
such delivery, the relinquishing Escrow Agent shall be discharged from
any and all responsibility or liability with respect to the Escrow
Property.
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(h) This Agreement shall not create any fiduciary duty on the
Escrow Agent?s part to the Sellers or the Buyer, nor disqualify the
Escrow Agent from representing PAC or the Buyer in any dispute between
Buyer or the Sellers. The parties understand that the Escrow Agent has
acted, and will continue to act, as counsel to PAC.
(i) The Escrow Agent represents that it is special counsel to PAC.
The parties agree that the Escrow Agent?s engagement as provided for
herein is not and shall not be objectionable to either the Sellers or
the Buyer for any reason.
(j) Upon the Escrow Agent?s performance of this Agreement in
accordance with its terms, it shall be deemed released and discharged
of any further obligations hereunder.
Section 5. Fees.
The fees and disbursements incurred by the Escrow Agent in connection
with the preparation, execution and administration of the escrow
created by this Agreement, if any, shall be paid by the Buyer and if
not paid by the Buyer then such fees and disbursements shall be paid by
PAC.
Section 6. Indemnification.
(a) Escrow Agent shall not be liable to anyone for any action
taken or omitted to be taken by it hereunder except in the case of an
Escrow Agent?s gross negligence or willful misconduct. In no event
shall the Escrow Agent be liable for indirect, punitive, special or
consequential damage or loss (including but not limited to lost
profits) whatsoever, even if the offending Escrow Agent has been
informed of the likelihood of such loss or damage and regardless of the
form of action.
(b) Each of the Sellers (jointly and severally) and the Buyer
agrees to indemnify the Escrow Agent (and its partners, agents and
employees) and hold it (and such partners, agents and employees)
harmless from and against any loss, liability, damage, cost and expense
of any nature incurred by the Escrow Agent, arising out of or in
connection with this Agreement or with the administration of its duties
hereunder, including but not limited to attorney's fees and other costs
and expenses of defending or preparing to defend against any claim of
liability unless and except to the extent such loss, liability, damage,
cost and expense shall be caused directly by an Escrow Agent's gross
negligence or willful misconduct. The foregoing indemnification and
agreement to hold harmless shall survive the termination of this
Agreement.
Section 7. Securities Law Compliance.
Upon Closing, the Buyer shall make such representations and furnish
such information as may, in the opinion of counsel for PAC, be
reasonably necessary to permit the transfer of the Shares in compliance
with the provisions of applicable federal or state securities laws.
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The Buyer acknowledges that PAC, upon advice of counsel, may require
the Transfer Agent to postpone the delivery of Shares upon Closing
until completion of such registration or other qualification of such
shares under any federal or state laws, or stock exchange listing, as
PAC may consider appropriate. The Buyer acknowledges that PAC may
require that prior to transfer of the Shares, the Buyer enters into a
written agreement to comply with any restrictions on subsequent
disposition that PAC, upon advice of counsel, deems necessary under any
applicable federal and state securities laws. The Buyer acknowledges
that PAC, stock certificates issued Closing will bear a legend
reflecting such restrictions.
Section 8. Sellers? Representative.
Each Seller has appointed Xxxxx Xxxxx (the ?Seller?s
Representative?) to give and receive notices on his behalf and to be
his exclusive representative with respect to any matter arising with
respect to any transaction contemplated by any this agreement and to
undertake the duties and responsibilities as his agent and attorney-in-
fact. This power of attorney is coupled with an interest and is
irrevocable. The Representative shall not be liable to anyone for any
action taken or not taken by him in good faith or for any mistake of
fact or law for anything that he may do or refrain from doing in
connection with his obligations under this Agreement in the absence of
his own gross negligence or willful misconduct. Any action taken or
not taken pursuant to the advice of counsel shall be conclusive
evidence of such good faith. The Sellers shall, jointly and severally,
indemnify and hold the Representative harmless from any and all
liability and expenses (including, without limitation, counsel fees)
which may arise out of any action taken or omitted by him as
Representative in accordance with this Agreement except such liability
and expense as may result from the gross negligence or willful
misconduct of the Representative.
Section 9. Notices.
Any notice permitted or required hereunder shall be in writing,
and shall be sent (i) by personal delivery, overnight delivery by a
recognized courier or delivery service, or (ii) mailed by registered or
certified mail, return receipt requested, postage prepaid, or (iii) by
confirmed telecopy accompanied by mailing of the original on the same
day by first class mail, postage prepaid, in each case to the parties
at their address set forth below (or to such other address as any such
party may hereafter designate by written notice to the other parties).
If to the Sellers, then to the Seller?s Representative at:
Xxxxx X. Xxxxx
0000 X. Xxxxxxxxxx Xxxx.
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Fax: (000) 000-0000
Tel: (000) 000-0000
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If to the Buyer:
Worldwide Security Acquisitions, LLC
000 Xxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx Xxxxxxx, Xxxxxxx 00000
Fax: (000) 000-0000
Tel: (000) 000-0000
Attn: ________________________
If to Escrow Agent:
Law Office of Xxxxxx Xxxxxxx Xxxxxxx, P.A.
000 Xxxxxxxxx Xxxxx Xxxxxx
Xxxx Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
Tel: (000) 000-0000
Attention: Xxxxxx Xxxxxxx Xxxxxxx, Esq.
Section 10. Miscellaneous.
(a) Binding Effect; Successors. This Agreement shall be
binding upon the respective parties hereto and their heirs, executors,
successors and assigns. If the Escrow Agent consolidates, merges or
converts into, or transfers all or substantially all of its corporate
trust business to, another corporation, the successor corporation
without any further act shall be the successor Escrow Agent.
(b) Consent to Jurisdiction and Service. Each of the parties
hereby absolutely and irrevocably consents and submits to the
jurisdiction of the courts in Broward County, Florida in connection
with any actions or proceedings arising out of or relating to this
Escrow Agreement brought by any of the other parties. In any such
action or proceeding, the parties each hereby absolutely and
irrevocably (i) waives any objection to jurisdiction or venue, (ii)
waives personal service of any summons, complaint, declaration or other
process, and (iii) agrees that the service thereof may be made by
certified or registered first-class mail directed to such party, as the
case may be, at their respective addresses in accordance with Section 8
hereof. Each of the parties agrees that no action or proceeding may be
brought against Escrow Agent except in the courts of the State of
Florida, as applicable.
(c) Waiver of Jury Trial.
THE PARTIES HEREBY WAIVE A TRIAL BY JURY OF ANY AND ALL ISSUES
ARISING IN ANY ACTION OR PROCEEDING BETWEEN THEM OR THEIR SUCCESSORS OR
ASSIGNS, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF ITS
PROVISIONS OR ANY NEGOTIATIONS IN CONNECTION HEREWITH.
(d) Force Majeure. The Escrow Agent shall not be responsible
for delays or failures in performance resulting from acts beyond its
control. Such acts shall include but not be limited to acts of God,
strikes, lockouts, riots, acts of war, epidemics, governmental
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regulations superimposed after the fact, fire, communication line
failures, computer viruses, power failures, earthquakes or other
disasters
(e) Modifications. This Agreement may not be altered or
modified without the express written consent of the parties hereto. No
course of conduct shall constitute a waiver of any of the terms and
conditions of this Escrow Agreement, unless such waiver is specified in
writing, and then only to the extent so specified. A waiver of any of
the terms and conditions of this Escrow Agreement on one occasion shall
not constitute a waiver of the other terms of this Escrow Agreement, or
of such terms and conditions on any other occasion. Notwithstanding
any other provision hereof, consent to an alteration or modification of
this Agreement may not be signed by means of an e-mail address.
(f) Governing Law. THIS ESCROW AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
FLORIDA.
(g) Reproduction of Documents. This Agreement and all
documents relating thereto, including, without limitation, (a)
consents, waivers and modifications which may hereafter be executed,
and (b) certificates and other information previously or hereafter
furnished, may be reproduced by any photographic, photostatic,
microfilm, optical disk, micro-card, miniature photographic or other
similar process. The parties agree that any such reproduction shall be
admissible in evidence as the original itself in any judicial or
administrative proceeding, whether or not the original is in existence
and whether or not such reproduction was made by a party in the regular
course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
(h) Counterparts. This Escrow Agreement may be executed in
several counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
Balance of Page Intentionally Left Blank
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IN WITNESS WHEREOF, this Agreement has been executed as a sealed
instrument by the parties hereto or their duly authorized
representatives, effective as of the date first above written.
ESCROW AGENT
By: /s/Xxxxxx Xxxxxxx Xxxxxxx
-------------------------------------------
Xxxxxx Xxxxxxx Xxxxxxx, Esq., President
Law Office of Xxxxxx Xxxxxxx Xxxxxxx, P.A.
BUYER
Worldwide Security Acquisitions, LLC,
a Delaware corporation
By: /s/Xxxxx Xxxxxxx
-------------------------------------------
Xxxxx Xxxxxxx, Managing Member
SELLER?S REPRESENTATIVE
By: /s/
-------------------------------------------
Xxxxx X. Xxxxx
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Exhibit ?A?
NUMBER PERCENTAGE OF
STOCKHOLDER OF SHARES ISSUED & OUTSTANDING
----------- --------- --------------------
Total ========== ==================
12
Exhibit ?B?
Buyer Shares Purchased
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Stock Purchase Escrow Agreement
