FUNDS ESCROW AGREEMENT
This
Agreement is dated as of the ____ day of January, 2007 among Xxxxxxx X. Xxxxxx
(“Assignor”), the parties identified on Schedule A hereto (“Assignees”), FTS
Group, Inc., a Nevada corporation (“FTS” or the “Company”) (collectively, the
“Parties”), and Grushko & Xxxxxxx, P.C. (the "Escrow Agent"):
W I T N E S S E T H:
WHEREAS,
the Parties intend to enter into an Assignment Agreement calling for the sale
and assignment by the Assignor to the Assignees of promissory notes (“Notes”)
for an aggregate purchase price of up to the amounts set forth on Schedule A
hereto; and
WHEREAS,
the Parties hereto require the Company to deliver reissued Notes against payment
therefore; and the Assignor to deliver the old Note; and the Assignees to
deliver the Escrowed Funds to the Escrow Agent, all of which will be held in
escrow and released by the Escrow Agent in accordance with the terms and
conditions of this Agreement; and
WHEREAS,
the Escrow Agent is willing to serve as escrow agent pursuant to the terms and
conditions of this Agreement;
NOW
THEREFORE, the parties agree as follows:
ARTICLE
I
INTERPRETATION
1.1. Definitions. Capitalized
terms used and not otherwise defined herein that are defined in the Assignment
Agreement shall have the meanings given to such terms in the Assignment
Agreement. Whenever used in this Agreement, the following terms shall
have the following respective meanings:
§ "Agreement"
means this Agreement and all amendments made hereto by written agreement between
the parties;
§ “Assignment”
means the signed Assignment and Amendment No. 1 to Note Agreement referred to
herein;
§ “Acknowledgement”
means the signed Acknowledgement referred to herein;
§ “Closing
Date” shall mean January ___, 2007;
§ "Escrowed
Payment" means an aggregate cash payment of up to $1,000,000 which is the
Purchase Price;
§ “Escrowed
Shares” shall mean 10,000 shares of See World Satellites, Inc., a Pennsylvania
corporation, with medallion signature guaranteed stock powers;
§ “Legal
Opinion” shall mean the legal opinion described in the Assignment;
§ “Note”
shall mean the promissory note issued to Assignor;
§ “Parties”
shall mean the Assignor, Assignees, and Escrow Agent;
§ “Reissued
Assigned Notes” shall mean the Assigned Notes to be reissued to
Assignees;
§ “Restricted
Shares” shall mean the Shares described in the Assignment.
§ Collectively,
the Company executed Assignment, Legal Opinion, Restricted Shares, Escrowed
Shares and Reissued Assigned Notes are referred to as “Company
Documents”;
§ Collectively,
the Assignor executed Assignment is referred to as “Assignor Documents”;
and
§ Collectively,
the Escrowed Payment and the Assignees executed Assignment are referred to as
"Assignee Documents".
§ The
Assignor Documents and Assignee Documents are collectively referred to as
“Parties Documents”.
1.2. Entire
Agreement. This Agreement along with the Company Documents,
Assignor Documents and Assignee Documents constitute the entire agreement
between the parties hereto pertaining to the Company Documents, Assignor
Documents and Assignee Documents and supersedes all prior agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties. There are no warranties, representations and other
agreements made by the parties in connection with the subject matter hereof
except as specifically set forth in this Agreement, the Company Documents,
Assignor Documents and Assignee Documents.
1.3. Extended
Meanings. In this Agreement words importing the singular
number include the plural and vice versa; words importing the masculine gender
include the feminine and neuter genders. The word "person" includes
an individual, corporation, partnership, trustee or trust or unincorporated
association, executor, administrator or legal representative.
1.4. Waivers and
Amendments. This Agreement may be amended, modified,
superseded, cancelled, renewed or extended, and the terms and conditions hereof
may be waived, only by a written instrument signed by all parties, or, in the
case of a waiver, by the party waiving compliance. Except as
expressly stated herein, no delay on the part of any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of any party of any right, power or privilege hereunder
preclude any other or future exercise of any other right, power or privilege
hereunder.
1.5. Headings. The
division of this Agreement into articles, sections, subsections and paragraphs
and the insertion of headings are for convenience of reference only and shall
not affect the construction or interpretation of this Agreement.
1.6. Law Governing this
Agreement. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regard to conflicts
of laws principles that would result in the application of the substantive laws
of another jurisdiction. Any action brought by either party against
the other concerning the transactions contemplated by this Agreement shall be
brought only in the state courts of New York or in the federal courts located in
the state of New York. Both parties and the individuals executing
this Agreement agree to submit to the jurisdiction of such courts and waive
trial by jury. The prevailing party (which shall be the party which
receives an award most closely resembling the remedy or action sought) shall be
entitled to recover from the other party its reasonable attorney's fees and
costs. In the event that any provision of this Agreement or any other
agreement delivered in connection herewith is invalid or unenforceable
under any applicable statute or rule of law, then such provision shall be deemed
inoperative to the extent that it may conflict therewith and shall be deemed
modified to conform with such statute or rule of law. Any such
provision which may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision of any
agreement.
1.7. Specific Enforcement,
Consent to Jurisdiction. The Parties acknowledge and agree
that irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the parties
shall be entitled to an injunction or injunctions to prevent or cure breaches of
the provisions of this Agreement and to enforce specifically the terms and
provisions hereof or thereof, this being in addition to any other remedy to
which any of them may be entitled by law or equity. Subject to
Section 1.6 hereof, each of the Parties hereby waives, and agrees not to assert
in any such suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of such court, that the suit, action or proceeding
is brought in an inconvenient forum or that the venue of the suit, action
or proceeding is improper. Nothing in this Section shall affect or
limit any right to serve process in any other manner permitted by
law.
1.8. Waiver of Potential
Conflict. Assignor and Assignee acknowledge that the
Escrow Agent has represented Assignor and Assignees in the past and waive any
conflict that may arise as a result of such representation.
ARTICLE
II
DELIVERIES
TO THE ESCROW AGENT
2.1. Company
Deliveries. On or prior to the Closing Date, the Company will
deliver to the Escrow Agent the Company Documents.
2.2. Assignor
Deliveries. On or prior to the Closing Date, the Assignor will
deliver to the Escrow Agent the Assignor Documents.
2.3. Assignee
Deliveries. On or before the Closing Date, Assignees shall
deliver to the Escrow Agent the Purchase Price and Assignee
Documents. The Escrowed Payment will be delivered pursuant to the
following wire transfer instructions:
Citibank,
N.A.
0000
0xx
Xxxxxx
Xxx Xxxx,
XX 00000, XXX
ABA
Number: 0210-00089
For
Credit to: Grushko & Xxxxxxx, XXXX Trust Account
Account
Number: 00000000
2.4. Intention to Create Escrow
Over Company Documents, Assignor Documents and Assignee
Documents. The Parties intend that the Company Documents,
Assignor Documents and Assignee Documents shall be held in escrow by the Escrow
Agent pursuant to this Agreement for their benefit as set forth
herein.
2.5. Escrow Agent to Deliver the
Company Documents, Assignor Documents and Assignee
Documents. The Escrow Agent shall hold and release the Company
Documents, Assignor Documents and Assignee Documents only in accordance with the
terms and conditions of this Agreement.
ARTICLE
III
RELEASE
OF ESCROW
3.1. Release of
Escrow. Subject to the provisions of Section 4.2, the Escrow
Agent shall release the Company Documents, Assignor Documents and Assignee
Documents as follows:
(a) On
the Closing Date, the Escrow Agent will simultaneously release the Company
Documents to the Company and the Assignor and Assignee Documents to the
respective parties except that (i) Assignor’s legal counsel, Xxxxxxx &
Xxxxxxxxx, shall release the Escrowed Shares to the Escrow Agent within 24 hours
of receipt and confirmation of the Escrowed Payment due and payable to the
Assignor from FTS; (ii) the Legal Opinion will be released to Assignees; (iii)
the Legal Fees will be released to Assignees’ attorneys; and (iv) the Due
Diligence Fee will be released to the Due Diligence Fee Recipients. The Escrow
Shares shall be retained by the Escrow Agent to be released pursuant to the
terms of the Assignment Agreement.
(b) All
funds to be delivered to the Assignor shall be delivered pursuant to the wire
instructions to be provided in writing by the Assignor to the Escrow
Agent.
(c) Notwithstanding
the above, upon receipt by the Escrow Agent of joint written instructions
("Joint Instructions") signed by the Parties, it shall deliver the Company
Documents, Assignor Documents and Assignee Documents in accordance with the
terms of the Joint Instructions.
(e) Notwithstanding
the above, upon receipt by the Escrow Agent of a final and non-appealable
judgment, order, decree or award of a court of competent jurisdiction (a "Court
Order"), the Escrow Agent shall deliver the Company Documents, Assignor
Documents and Assignee Documents in accordance with the Court
Order. Any Court Order shall be accompanied by an opinion of counsel
for the party presenting the Court Order to the Escrow Agent (which opinion
shall be satisfactory to the Escrow Agent) to the effect that the court issuing
the Court Order has competent jurisdiction and that the Court Order is final and
non-appealable.
3.2. Acknowledgement of Parties;
Disputes. The Parties acknowledge that the only terms and
conditions upon which the Company Documents, Assignor Documents and Assignee
Documents are to be released are set forth in Sections 3 and 4 of this
Agreement. The Parties reaffirm their agreement to abide by the terms
and conditions of this Agreement with respect to the release of the Company
Documents, Assignor Documents and Assignee Documents. Any dispute
with respect to the release of the Company Documents, Assignor Documents and
Assignee Documents shall be resolved pursuant to Section 4.2 or by agreement
between the Parties.
ARTICLE
IV
CONCERNING
THE ESCROW AGENT
4.1. Duties and Responsibilities of the
Escrow Agent. The Escrow Agent's duties and responsibilities
shall be subject to the following terms and conditions:
(a) The
Parties acknowledge and agree that the Escrow Agent (i) shall not be responsible
for or bound by, and shall not be required to inquire into whether any of the
Parties is entitled to receipt of the Company Documents, Assignor Documents and
Assignee Documents pursuant to, any other agreement or otherwise; (ii) shall be
obligated only for the performance of such duties as are specifically assumed by
the Escrow Agent pursuant to this Agreement; (iii) may rely on and shall be
protected in acting or refraining from acting upon any written notice,
instruction, instrument, statement, request or document furnished to it
hereunder and believed by the Escrow Agent in good faith to be genuine and to
have been signed or presented by the proper person or party, without being
required to determine the authenticity or correctness of any fact stated therein
or the propriety or validity or the service thereof; (iv) may assume that
any person believed by the Escrow Agent in good faith to be authorized to give
notice or make any statement or execute any document in connection with the
provisions hereof is so authorized; (v) shall not be under any duty to give the
property held by Escrow Agent hereunder any greater degree of care than Escrow
Agent gives its own similar property; and (vi) may consult counsel satisfactory
to Escrow Agent, the opinion of such counsel to be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by Escrow Agent hereunder in good faith and in accordance with the opinion of
such counsel.
(b) The
Parties acknowledge that the Escrow Agent is acting solely as a stakeholder at
their request and that the Escrow Agent shall not be liable for any action taken
by Escrow Agent in good faith and believed by Escrow Agent to be authorized or
within the rights or powers conferred upon Escrow Agent by this
Agreement. The Assignor and Assignee, jointly and severally, agree to
indemnify and hold harmless the Escrow Agent and any of Escrow Agent's partners,
employees, agents and representatives for any action taken or omitted to be
taken by Escrow Agent or any of them hereunder, including the fees of
outside counsel and other costs and expenses of defending itself against any
claim or liability under this Agreement, except in the case of gross negligence
or willful misconduct on Escrow Agent's part committed in its capacity as Escrow
Agent under this Agreement. The Escrow Agent shall owe a duty only to
the Assignor and Assignee under this Agreement and to no other
person.
(c) The
Assignor and Assignee, jointly and severally agree to reimburse the
Escrow Agent for outside counsel fees, to the extent authorized hereunder and
incurred in connection with the performance of its duties and responsibilities
hereunder.
(d) The
Escrow Agent may at any time resign as Escrow Agent hereunder by giving five (5)
days prior written notice of resignation to the Parties. Prior to the
effective date of the resignation as specified in such notice, the Assignor and
Assignees will issue to the Escrow Agent a Joint Instruction authorizing
delivery of the Company Documents, Assignor Documents and Assignee Documents to
a substitute Escrow Agent selected by the Assignee and Assignor. If
no successor Escrow Agent is named by the Assignees and Assignor, the Escrow
Agent may apply to a court of competent jurisdiction in the State of New York
for appointment of a successor Escrow Agent, and to deposit the Company
Documents, Assignor Documents and Assignee Documents with the clerk of any such
court.
(e) The
Escrow Agent does not have and will not have any interest in the Company
Documents, Assignor Documents and Assignee Documents, but is serving only as
escrow agent, having only possession thereof. The Escrow Agent shall
not be liable for any loss resulting from the making or retention of any
investment in accordance with this Escrow Agreement.
(f) This
Agreement sets forth exclusively the duties of the Escrow Agent with respect to
any and all matters pertinent thereto and no implied duties or obligations shall
be read into this Agreement.
(g) The
Escrow Agent shall be permitted to act as counsel for the Assignee in any
dispute as to the disposition of the Company Documents, Assignor Documents and
Assignee Documents, in any other dispute between the Parties, whether or not the
Escrow Agent is then holding the Company Documents, Assignor Documents and
Assignee Documents and continues to act as the Escrow Agent
hereunder.
(h) The
provisions of this Section 4.1 shall survive the resignation of the Escrow Agent
or the termination of this Agreement.
4.2. Dispute Resolution:
Judgments. Resolution of disputes arising under this Agreement
shall be subject to the following terms and conditions:
(a) If
any dispute shall arise with respect to the delivery, ownership, right of
possession or disposition of the Company Documents, Assignor Documents and
Assignee Documents, or if the Escrow Agent shall in good faith be uncertain as
to its duties or rights hereunder, the Escrow Agent shall be authorized, without
liability to anyone, to (i) refrain from taking any action other than to
continue to hold the Company Documents, Assignor Documents and Assignee
Documents pending receipt of a Joint Instruction from the Company, Assignor and
Assignee, or (ii) deposit the Company Documents, Assignor Documents and Assignee
Documents with any court of competent jurisdiction in the State of New York, in
which event the Escrow Agent shall give written notice thereof to the Assignor
and Assignees and shall thereupon be relieved and discharged from all
further obligations pursuant to this Agreement. The Escrow Agent may,
but shall be under no duty to, institute or defend any legal proceedings
which relate to the Company Documents, Assignor Documents and Assignee
Documents. The Escrow Agent shall have the right to retain counsel if
it becomes involved in any disagreement, dispute or litigation on account of
this Agreement or otherwise determines that it is necessary to consult
counsel.
(b) The
Escrow Agent is hereby expressly authorized to comply with and obey any Court
Order. In case the Escrow Agent obeys or complies with a Court Order,
the Escrow Agent shall not be liable to the Parties or to any other person,
firm, corporation or entity by reason of such compliance.
ARTICLE
V
GENERAL
MATTERS
5.1. Termination. This
escrow shall terminate upon the release of all of the Company Documents,
Assignor Documents and Assignee Documents or at any time upon the agreement in
writing of the Assignor and Assignees.
5.2. Notices. All
notices, demands, requests, consents, approvals, and other communications
required or permitted hereunder shall be in writing and, unless otherwise
specified herein, shall be (i) personally served, (ii) deposited in the mail,
registered or certified, return receipt requested, postage prepaid, (iii)
delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or
permitted to be given hereunder shall be deemed effective (a) upon hand
delivery or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, 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 (b) 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:
(a) If
to Assignor, to:
Xxxxxxx
X. Xxxxxx
000 Xxxxx
Xxxxxx
Xxxxx
Xxxx, XX 00000
000-000-0000
Fax:
__________
(b) If
to Assignees, to: the addresses and fax numbers described on Schedule A
hereto
(c) If
to the Escrow Agent, to:
Grushko
& Xxxxxxx, P.C.
000 Xxxxx
Xxxxxx, Xxxxx 0000
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
000-000-0000
or to
such other address as any of them shall give to the others by notice made
pursuant to this Section 5.2.
5.3. Interest. The
Escrowed Payment shall not be held in an interest bearing account nor will
interest be payable in connection therewith. In the event the
Escrowed Payment is deposited in an interest bearing account, the Assignor and
Assignee shall be entitled to receive its pro rata portion of any
accrued interest thereon, but only if the Escrow Agent receives from such party
the party’s United States taxpayer identification number and other requested
information and forms.
5.4. Assignment; Binding
Agreement. Neither this Agreement nor any right or obligation
hereunder shall be assignable by any party without the prior written consent of
the other parties hereto. This Agreement shall enure to the benefit
of and be binding upon the parties hereto and their respective legal
representatives, successors and assigns.
5.5. Invalidity. In
the event that any one or more of the provisions contained herein, or the
application thereof in any circumstance, is held invalid, illegal, or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the parties hereto shall be
enforceable to the fullest extent permitted by law.
5.6. Counterparts/Execution. This
Agreement may be executed in any number of counterparts and by different
signatories hereto on separate counterparts, each of which, when so executed,
shall be deemed an original, but all such counterparts shall constitute but one
and the same instrument. This Agreement may be executed by facsimile
transmission and delivered by facsimile transmission.
5.7. Agreement. Each
of the undersigned states that he has read the foregoing Funds Escrow Agreement
and understands and agrees to it.
| XXXXXXX X. XXXXXX | ALPHA CAPITAL ANSTALT | |||||
| “Assignor” | “Assignee” | |||||
|
|
By: |
|
||||
| PLATINUM LONG TERM GROWTH V | XXXXX INTERNATIONAL LTD. | |||||
| “Assignee” | “Assignee” | |||||
| By: |
|
By: |
|
|||
| WHALEHAVEN CAPITAL FUND LIMITED | ESCROW AGENT: | |||||
| Assignee” | ||||||
| By: |
|
|||||
| GRUSHKO & XXXXXXX, P.C. | ||||||
SCHEDULE A TO FUNDS ESCROW
AGREEMENT
|
ASSIGNEES
|
PURCHASE
PRICE
|
PRINCIPAL
AMOUNT OF NOTE
|
SHARES
|
|
ALPHA
CAPITAL ANSTALT
Pradafant
7
9490
Furstentums
Vaduz,
Lichtenstein
Fax:
000-00-00000000
|
$325,000.00
|
$390,000.00
|
4,875,000
|
|
PLATINUM
LONG TERM GROWTH V
000
Xxxx 00xx
Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx, XX 00000
Fax:
(212)
|
$325,000.00
|
$390,000.00
|
4,875,000
|
|
XXXXX
INTERNATIONAL LTD.
53rd
Street Urbanizacion Obarrio
Swiss
Tower, 16th
Floor, Panama
Republic
of Panama
Fax:
(000) 000-0000
|
$150,000.00
|
$180,000.00
|
2,250,000
|
|
WHALEHAVEN
CAPITAL FUND LIMITED
c/o
FWS Capital Ltd.
0xx
Xxxxx, 00 Xxx-Xxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxx XX00
Fax:
(000) 000-0000
|
$200,000.00
|
$240,000.00
|
3,000,000
|
|
TOTAL
|
$1,000,000.00
|
$1,200,000.00
|
15,000,000
|
