EXHIBIT 10.1
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of March 28, 2000, among Providential
Holdings, Inc., a Nevada corporation (the "Company"), the persons listed on the
Purchaser Signature Page hereto (each of whom is individually referred to as a
"Purchaser" and all of whom are collectively referred to as the "Purchasers")
and Xxxxxxx Xxxxxxxx Xxxxx Xxxxxxxxxxx & Kuh, LLP, as escrow agent (the "Escrow
Agent").
W I T N E S S E T H:
WHEREAS, pursuant to the terms of a Series 1 Bridge Note Purchase and
Security Agreement (the "Purchase Agreement"), dated as of the date hereof,
between the Purchasers and the Company, each Purchaser has agreed to purchase
certain securities of the Company (the "Securities") at the purchase price (the
"Purchase Price") set forth in the Purchase Agreement; and
WHEREAS, pursuant to the Purchase Agreement, each Purchaser is required
to deposit the Purchase Price into escrow with the Escrow Agent;
NOW, THEREFORE, the parties agree as follows:
1. Capitalized terms used herein and not otherwise defined herein
shall have the meanings given to such terms in the Purchase Agreement.
2. The Escrow Agent agrees to act as escrow agent in accordance
with the provisions hereof.
(a) Each Purchaser is depositing with the Escrow Agent,
by wire transfer to the Escrow Agent's escrow account specified in
Section 1.3 of the Purchase Agreement, which shall be non-interest
bearing, the Purchase Price specified in Section 1.1 of the Purchase
Agreement (the "Escrow Fund").
(b) Upon receipt of a notice from the Company that the
Closing has occurred, the Escrow Agent shall deliver the Escrow Fund by
wire transfer to the Company.
(c) If the Escrow Agent receives a joint notice from all
of the Purchasers and t he Company that the Purchase Agreement has been
terminated without the Closing having occurred, the Escrow Agent shall
return the Escrow Fund to each Purchaser.
(d) If after April 24, 2000, the Escrow Agent receives
notice from any Purchaser that the Closing has not occurred and such
Purchaser is electing to rescind the Purchase Agreement, the Escrow
Agent shall return such Purchaser is potion of the Escrow Fund.
3. If the Escrow Agent receives timely notice from any party
which, in the opinion of the Escrow Agent, is in conflict with the timely notice
received from any other party, the Escrow
Agent shall refrain from taking any action thereon unless it is otherwise
directed in writing by both of such parties or by an order of a court of
competent jurisdiction.
4. The Escrow Agent shall be liable only for its willful
misconduct and gross negligence and not for any act done or omitted by it in
good faith.
5. The Escrow Agent may rely, and shall be protected in acting or
refraining from acting, upon any written notice, instruction or request,
furnished to it hereunder and reasonably believed by it to be genuine. If the
Escrow Agent receives any notice under which some action is to be taken by it,
it shall not be required to act thereon until it has had an opportunity, if it
so desires, to investigate the authenticity of such notice.
6. The Escrow Agent has the right to, and may, at any time,
resign and be discharged from its duties hereunder by giving notice in writing
of such resignation, specifying a date (which shall be no earlier than thirty
(30) days after such notice is given) when such resignation shall take effect;
and, after the giving of such notice, the Escrow Agent shall take no further
action except in connection with such resignation unless all of the other
parties hereto jointly request such action. If the other parties hereto do not
appoint a substitute escrow agent prior to the effective date of the Escrow
Agent's resignation, the Escrow Agent may deposit the Escrow Fund with a court
of appropriate jurisdiction, and thereupon the Escrow Agent shall be fully
relieved and discharged of any further duties hereunder.
7. The Escrow Agent may consult with counsel of its own choice,
which may be Xxxxxxx Xxxxxxxx Xxxxx Xxxxxxxxxxx & Kuh, LLP, and shall have full
and complete authorization and protection for any action taken or suffered by it
hereunder in good faith and in accordance with the opinion of such counsel.
8. The duties of the Escrow Agent shall be limited to those
expressly set forth herein.
9. The Company shall reimburse the Escrow Agent for any costs and
expenses incurred by it in connection with its acting as escrow agent hereunder,
including the cost of consultation with counsel, and the Escrow Agent shall have
a first lien on the Escrow Fund for any cost or expense incurred hereunder. The
Escrow Agent shall not charge any fee for acting as escrow agent hereunder.
10. The Company and the Purchasers, jointly and severally, agree
to indemnify the Escrow Agent for, and to hold it harmless against, any loss,
liability, damage or expense incurred by the Escrow Agent arising out of, or in
connection with, this Agreement, including but not limited to the costs and
expenses of defending itself against any claim of liability in the premises,
except for liability or expense resulting from the willful misconduct or gross
negligence of the Escrow Agent, and the Escrow Agent shall have a first lien on
the Escrow Fund for any such loss, liability, damage, or expense.
11. The Company and each of the Purchasers agree not to commence
any litigation against the Escrow Agent unless, (a) the Escrow Agent has
committed gross negligence or willful misconduct or (b) the Escrow Agent has not
submitted its written resignation as escrow agent hereunder in accordance with
paragraph 6 hereof; and if litigation is commenced against the Escrow Agent
without satisfying all of the conditions set forth in clauses (a) or (b) above,
the party
commencing such litigation shall pay all of the costs and expenses of the Escrow
Agent in connection therewith.
12. Any notice, consent, waiver, or other communication required
or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered (a) upon receipt, when delivered
personally, (b) upon receipt, when sent by facsimile, provided, that a copy is
mailed by U.S. certified mail, return receipt requested, (c) three (3) days
after being sent by U.S. certified mail, return receipt requested, or (d) one
(1) day after deposit with a nationally recognized overnight delivery service,
in each case properly addressed to the party to receive the same. The addresses
and facsimile numbers for such communications shall be:
(a) If to a Purchaser, to its, his or her address set forth on the
signature page of this Agreement, with a copy to the person designated in the
Purchase Agreement;
(b) If to the Company, at:
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxxx 00000
Attn: Chief Executive Officer
Fax: (000) 000-0000
(c) If to the Escrow Agent, at:
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000;
or to such other address as any such party may designate by notice to the other
party. Each party shall provide five (5) days prior written notice to the other
party of any change in address or facsimile number.
13. The Company and each Purchaser acknowledges and understands
that the Escrow Agent has been, and currently is, acting as counsel to the
placement agent (which through an affiliate also may be a Purchaser) and agrees
that if any dispute arises with respect to this Agreement, the Purchase
Agreement or any of the other documents being executed and delivered
concurrently herewith or therewith, or in any other situation between the
Company, the Purchasers and/or the placement agent, the Company and each
Purchaser will waive any apparent conflict of interest should the Escrow Agent
represent the placement agent.
14. This Agreement constitutes the entire agreement among the
parties and supersedes all prior agreements, understandings and arrangements,
oral or written, among the parties with respect to the subject matter hereof.
15. This Agreement shall inure to the benefit of and shall be
binding upon the parties and their respective successors. Notwithstanding the
foregoing, this Agreement is not assignable by the Company or the Purchasers and
may be enforced only by the parties.
16. Nothing in this Agreement, expressed or implied, is intended
to or shall (a) confer on any person other than the parties, or their respective
successors, any rights, remedies, obligations or liabilities under or by reason
of this Agreement, or (b) constitute the parties, partners or participants in a
joint venture. The Escrow Agent shall not be obliged to recognize any such
succession, until appropriate written notice thereof shall have been received by
it.
17. This Agreement may not be modified or amended except by an
instrument or instruments in writing signed by all of the parties. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to conflicts of law principles. Each party
hereby irrevocably submits to the non-exclusive jurisdiction of the state and
federal courts sitting the City of New York, borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law. If any provision of this
Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
18. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
ESCROW AGENT SIGNATURE PAGE
TO
ESCROW AGREEMENT
ESCROW AGENT:
XXXXXXX XXXXXXXX XXXXX
XXXXXXXXXXX & KUH, LLP, AS ESCROW AGENT
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------
Xxxxxxx X. Xxxxxxx, a partner
COMPANY SIGNATURE PAGE
TO
ESCROW AGREEMENT
THE COMPANY
PROVIDENTIAL HOLDINGS, INC.
By: /s/ Xxxxx Xxxxxx
-----------------
Name: Xxxxx Xxxxxx
Title: President and Chief
Executive Officer
PURCHASER SIGNATURE PAGE
TO
ESCROW AGREEMENT
PURCHASER
Purchaser Name:__________________________
By:______________________________________
Name:____________________________________
Title:___________________________________
Address:_________________________________
_________________________________
Attn:____________________________
Fax:_____________________________
