Exhibit 2.5
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement") is made and entered into as of
December 16, 2004 (the "Closing Date"), by and among SURGE GLOBAL ENERGY, INC.,
a Delaware corporation (the "Seller"), ZENVESCO, INC., a NEVADA corporation (the
"Buyer"), XXXXXXX X. XXXXXX, an individual ("Pledgor," and together with the
Seller and Buyer, the "Parties"), and Xxxxx & Xxxxx, PLLC, as escrow agent
("Escrow Agent").
RECITALS
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A. Pledgor is a shareholder of Seller, and is the owner of Two Hundred
Thousand (200,000) shares of common stock of Seller (the "Shares").
B. Pledgor is sole shareholder of Buyer.
C. Parties are entering into this Agreement pursuant to the terms of
that certain Asset Purchase Agreement, dated as of December 16, 2004, entered
into by and between Buyer, Seller, Pledgor, and the other parties thereto (the
"Asset Purchase Agreement"), pursuant to which the Seller agreed to sell and the
Buyer agreed to buy certain tobacco products and related assets of Seller (the
"Assets") and the Seller agreed to assign and the Buyer agreed to assume certain
liabilities of Seller (the "Liabilities").
D. Parties also are entering into this Agreement pursuant to the terms
of that certain Pledge Agreement, dated as of December 16, 2004, between Seller
and Pledgor (the "Pledge Agreement"), pursuant to which Pledgor agreed to
deliver, pledge and grant a continuing interest in the Shares to Seller as
security for the Pledgor's Guarantee, made and executed on December 16, 2004
(the "Guarantee"), with respect providing a guarantee for performance of Buyer's
obligations to Seller under the Asset Purchase Agreement.
Capitalized terms used in this Agreement without definition shall have
the respective meanings given to them in the Asset Purchase Agreement.
NOW, THEREFORE, the parties, intending to be legally bound, hereby
agree as follows:
1. ESTABLISHMENT OF ESCROW.
(a) Pledgor is depositing the Shares with Escrow Agent (the "Escrowed
Shares"). Escrow Agent acknowledges receipt thereof.
(b) Escrow Agent hereby agrees to act as escrow agent and to hold,
safeguard and distribute the Escrowed Shares pursuant to the terms and
conditions hereof.
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(c) The parties agree to execute any reasonable general escrow
instructions required by Escrow Agent; provided such general instructions are
not inconsistent with this Agreement.
2. RETURN OF ESCROWED SHARES.
When all of the Buyer's obligations under the Asset Purchase Agreement
have been paid, discharged or otherwise satisfied, Escrow Agent shall deliver
the Shares to the Pledgor based upon joint written instructions from Buyer,
Seller and Pledgor; subject, however, to any rights of Seller under the Pledge
Agreement to sell or otherwise dispose of the Shares upon an "Event of Default,"
as such term is defined in the Pledge Agreement.
3. DUTIES OF ESCROW AGENT.
(a) Escrow Agent shall hold the Shares and any related assignment
document separate from certificate, and shall interpret and act under this
Escrow Agreement, subject to the rights and remedies of the parties to the
Pledge Agreement. If any provision of this Escrow Agreement conflicts with the
Pledge Agreement, the Pledge Agreement controls; provided that the two
agreements should be read to coordinate with each other to the greatest possible
extent.
(b) Escrow Agent shall not be liable, except for its own bad faith,
gross negligence or willful misconduct. Except with respect to claims based upon
such bad faith, gross negligence or willful misconduct that are successfully
asserted against Escrow Agent, Pledgor, Seller and Buyer shall jointly and
severally indemnify and hold harmless Escrow Agent (and any successor Escrow
Agent) from and against any and all losses, liabilities, claims, actions,
damages and expenses, including reasonable attorneys' fees and disbursements,
arising out of and in connection with this Agreement.
(c) Escrow Agent shall be entitled to rely upon any arbitration award,
order, judgment, certification, demand, notice, instrument or other writing
delivered to it hereunder without being required to determine the authenticity
or the correctness of any fact stated therein or the propriety or validity of
the service thereof. Escrow Agent may act in reliance upon any instrument or
signature believed by it to be genuine and may assume that the person purporting
to give receipt or advice or make any statement or execute any document in
connection with the provisions hereof has been duly authorized to do so. Escrow
Agent may conclusively presume that the undersigned representative of any party
hereto which is an entity other than a natural person has full power and
authority to instruct Escrow Agent on behalf of that party unless written notice
to the contrary is delivered to Escrow Agent.
(d) Escrow Agent may act pursuant to the written advice of counsel with
respect to any matter relating to this Agreement and shall not be liable for any
action taken or omitted by it in good faith in accordance with such advice.
(e) Escrow Agent does not have any interest in the Escrowed Shares
received hereunder but is serving as escrow holder only and having only
possession thereof. This Section 3(e) and Section 3(b) of this Agreement shall
survive notwithstanding any termination of this Agreement or the resignation of
Escrow Agent.
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(f) Escrow Agent makes no representation as to the validity, value,
genuineness or the collectability of any security or other document or
instrument held by or delivered to it.
(g) Escrow Agent (and any successor Escrow Agent) may at any time
resign as such by delivering the Escrowed Shares to any successor Escrow Agent
jointly designated by the Parties in writing, or to any court of competent
jurisdiction, whereupon Escrow Agent shall be discharged of and from any and all
further obligations arising in connection with this Agreement. The resignation
of Escrow Agent will take effect on the earlier of (a) the appointment of a
successor (including a court of competent jurisdiction) or (b) the day which is
thirty (30) days after the date of delivery of its written notice of resignation
to the Parties. If at that time Escrow Agent has not received a designation of a
successor Escrow Agent, Escrow Agent's sole responsibility after that time shall
be to retain and safeguard the Escrowed Shares until receipt of a designation of
successor Escrow Agent or a joint written disposition instruction by the Parties
or a final non-appealable order of a court of competent jurisdiction.
(h) In the event of any disagreement between the Parties resulting in
adverse claims or demands being made in connection with the Escrowed Shares, or
in the event that Escrow Agent is in doubt as to what action it should take
hereunder, Escrow Agent shall be entitled to retain the Escrowed Shares until
Escrow Agent shall have received (i) a final nonappealable arbitration award or
order of a court of competent jurisdiction directing delivery of the Escrowed
Shares or (ii) a written agreement executed by all other parties hereto
directing delivery of the Escrowed Shares, in which event Escrow Agent shall
disburse the Escrowed Shares in accordance with such order or agreement. Any
arbitration award or court order shall be accompanied by a legal opinion by
counsel for the presenting party satisfactory to Escrow Agent to the effect that
such award or order is final and non-appealable. Escrow Agent shall act on such
arbitration award or court order and legal opinion without further question.
(i) Pledgor or Buyer shall pay Escrow Agent compensation for the
services to be rendered by Escrow Agent hereunder.
(j) No printed or other matter (including, without limitation,
prospectuses, notices, reports and promotional material) that mentions Escrow
Agent's name or the rights, powers, or duties of Escrow Agent shall be issued by
the other parties hereto or on such parties' behalf unless Escrow Agent shall
first have given its specific written consent thereto.
4. LIMITED RESPONSIBILITY.
This Agreement expressly sets forth all the duties of Escrow Agent with
respect to any and all matters pertinent hereto. Escrow Agent shall not be bound
by the provisions of any agreement among the other parties hereto except this
Agreement.
5. NOTICES.
All notices or other communications required or permitted hereunder
shall be in writing and shall be deemed given or delivered (a) when delivered
personally, against written receipt, (b) if sent by registered or certified
mail, return receipt requested, postage prepaid, when received, (c) when
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received by facsimile transmission, if confirmed by the other means described in
clause (a) or (b), and (d) when delivered by a nationally recognized overnight
courier service, prepaid, and shall be addressed as follows:
If to Seller: Surge Global Energy, Inc.
00000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx XXX 92130
Attention: Xxxx Xxxxx, CEO
Facsimile: (000) 000-0000
With a copy to: Xxxxx & Xxxxx, PLLC
000 Xxxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxx
Facsimile: (000) 000-0000
If to Buyer: Zenvesco Inc.
0000 Xxxxxxx Xxx. XX
Xxxxx Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Facsimile: (000) 000-0000
With a copy to: Xxxxxx Xxxxx, Esq.
0000 Xxxxxxx Xxx. XX
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Facsimile: (000) 000-0000
If to Pledgor: Xxxxxxx Xxxxxx
0000 Xxxxxxx Xxx. XX
Xxxxxx, XX 00000
Attention:
Facsimile: (000) 000-0000
With a copy to: Xxxxxx Xxxxx, Esq.
0000 Xxxxxxx Xxx. XX
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
Facsimile: (000) 000-0000
If to Escrow Agent: Xxxxx & Xxxxx, PLLC
000 Xxxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX
Attention: Xxxxxx Xxxxx
Facsimile: (000) 000-0000
or to such other address as such party may indicate by a written notice
delivered to the other parties hereto.
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6. GOVERNING LAW AND JURISDICTION.
This Agreement shall be governed by, and be construed and enforced in
accordance with the laws of the State of California as provided in Section 11.14
of the Asset Purchase Agreement. The parties to this Agreement submit to
jurisdiction in the State of California for any action or proceeding arising out
of or relating to this Agreement as provided in Section 11.15 of the Asset
Purchase Agreement.
7. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original and all of which, when taken together,
will be deemed to constitute one and the same instrument.
8. HEADINGS.
The headings of sections in this Agreement are provided for convenience
only and shall not affect the interpretation of this Agreement.
9. AMENDMENTS AND WAIVER.
No amendment, waiver or consent with respect to any provision of this
Agreement shall in any event be effective, unless the same shall be in writing
and signed by all parties hereto, and then such amendment, waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given. The failure of any party at any time or times to require
performance of any provisions hereof shall in no manner affect that party's
right at a later time to enforce the same. No waiver by any party of the breach
of any term or covenant contained in this Agreement in any one or more instances
shall be deemed to be, or construed as, a further continuing waiver of any such
breach, or a waiver of the breach of any other term or covenant contained in
this Agreement.
10. EXCLUSIVE AGREEMENT AND MODIFICATION.
Other than the Pledge Agreement and Guarantee, this Agreement
supersedes all prior agreements among the parties with respect to its subject
matter and constitutes (along with the documents referred to in this Agreement)
a complete and exclusive statement of the terms of the agreement between the
parties with respect to its subject matter. This Agreement may not be amended
except by a written agreement executed by the Buyer, the Seller, the Pledgor and
the Escrow Agent.
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IN WITNESS WHEREOF, the parties have executed and delivered this Escrow
Agreement as of the date first written above.
BUYER: ZENVESCO, INC., a Nevada corp.
/s/ Xxxxxxx Xxxxxx
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By: Xxxxxxx Xxxxxx
Its: President
SELLER: SURGE GLOBAL ENERGY, INC., a Delaware corporation
/s/ Xxxx X. Xxxxx
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By: Xxxx X. Xxxxx
Its: CEO
PLEDGOR: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, an individual
ESCROW AGENT: XXXXX & XXXXX, PLLC
/s/ Xxxxxx Xxxxx
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By: Xxxxxx Xxxxx, Esq.
Its:
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