ESCROW AGREEMENT
EXHIBIT
C
THIS
ESCROW AGREEMENT (“Agreement”) is
made as of January 14, 2008, by and between Xxxx Xxxxxxxx (“Xxxxxxxx”) and
Dutchess Private Equities Fund, Ltd. (“Dutchess” or “Secured
Party”) and Xxxxxx X. Xxxxxxx,
Esq., (“Escrow Agent”) (singly a “Party” and cumulatively the
“Parties”).
W
I T N E
S S E T H:
WHEREAS,
on June 26, 2007, Dutchess
made a loan of one million, three hundred seventy-five thousand dollars ($1.375)
to Bedminster National Corp. (“Bedminster” or the “Company”) pursuant to certain
terms and conditions in consideration for which the Company issued to Dutchess
a
Promissory Note (“Note”).
WHEREAS,
the Company and its subsidiaries and Dutchess executed a Security Agreement
(“Security Agreement”), dated June 26, 2007, providing Dutchess with a security
interest in any and all Collateral of the Company.
WHEREAS,
on January 14, 2008, the Company and Dutchess executed an Amendment to the
Promissory Note and Security Agreement (the Note, Security Agreement, and
Amendment are collectively referred to as the “Agreements”).
WHEREAS,
on January 14, 2008, Patrizio and Dutchess executed a Share Pledge Agreement,
which is incorporated herein,
WHEREAS
Patrizio is providing the Shares as security for the obligations and
indebtedness of the Company.
WHEREAS,
in order to facilitate
delivery of shares upon any default of the Agreements and to provide comfort
to
Dutchess that the shares will be so delivered, Patrizio has agreed to issue
and
place in escrow 5 million shares of Class A Common Stock and 2.0 million shares
of Class B Common Stock (“Shares”), to be held and released in accordance with
the terms of this Agreement; and
WHEREAS,
Patrizio and Dutchess have requested that the Escrow Agent hold the Shares
in
escrow pursuant to the terms of this Agreement, and the Escrow Agent has agreed
to so act.
NOW,
THEREFORE, in consideration of the
covenants and mutual promises contained herein and other good and valuable
consideration, the receipt and legal sufficiency of which are hereby
acknowledged and intending to be legally bound hereby, the Parties agree as
follows:
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ARTICLE
1
TERMS
OF THE ESCROW
1.1
The Parties hereby agree to have Xxxxxx X. Xxxxxxx, Esq. act as Escrow Agent
whereby the Escrow Agent shall hold the Shares in accordance with the terms
of
this Agreement, and the Escrow Agent has accepted such appointment.
1.2
Patrizio shall immediately deliver to the Escrow Agent certificates representing
the Shares in his name, the stock xxxxxx with a signature guarantee, and a
transfer letter to the transfer agent, attached as Exhibit A to the Share Pledge
Agreement, authorizing transfer of the Shares and stock powers to Dutchess
in
the Event of Default.
1.3
Upon the Escrow Agent’s receipt of the Shares, the Escrow Agent shall
immediately notify Dutchess and Patrizio.
1.4
The Escrow Agent shall then hold the Shares at his office pending receipt of
a
notice of default from Dutchess.
1.5
Upon receipt by the Escrow Agent of a notice of default from Dutchess, the
Escrow Agent shall promptly notify Patrizio and send all Shares to Dutchess.
A
copy of all correspondence with the Escrow Agent shall be provided by the Escrow
Agent to the other parties hereto.
1.6
Upon payment in full of all amounts outstanding under the Note, Dutchess shall
notify the Escrow Agent of the same, with a copy to Patrizio and the Company.
The Escrow Agent shall thereupon promptly deliver the Shares to
Patrizio.
1.7 It
is
understood and agreed that the Shares shall not be delivered to Patrizio unless
and until the Note is paid in full.
1.8
This Agreement may be altered or amended only with the consent of all of the
Parties hereto. Should any of the Parties attempt to change
this
Agreement in a manner which, in the Escrow Agent’s discretion, shall be
undesirable, the Escrow Agent may resign as Escrow Agent by notifying the Parties in
writing. In the case of the Escrow Agent’s resignation or removal
pursuant to the foregoing, his only duty, until receipt of notice from the
Parties that a successor escrow agent has been appointed, shall be to hold
and
preserve the Shares that are in his possession. Upon receipt by the
Escrow Agent of said notice from the Parties of the appointment of a successor
escrow agent, the name of a successor escrow account and a direction to transfer
the Shares the Escrow Agent shall promptly thereafter transfer all of the Shares
held in escrow to said successor escrow agent. Immediately after said
transfer of Shares, the Escrow Agent shall furnish the Parties with proof of
such transfer. The Escrow Agent is authorized to disregard any
notices, requests, instructions or demands received by it from the Parties
after
notice of resignation or removal shall have been given, unless the same shall
be
the aforementioned notice from the Parties to transfer the Shares to a successor
escrow agent or to return same to the respective Parties.
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1.9
The Escrow Agent shall be reimbursed by the Parties for any reasonable
expenses incurred in the event there is a conflict between the Parties and
the
Escrow Agent shall deem it necessary to retain counsel. The Escrow Agent shall
not be liable for any action taken or omitted by him in good faith in accordance
with the advice of the Escrow Agent’s counsel; and in no event shall the Escrow
Agent be liable or responsible except for the Escrow Agent’s own gross
negligence or willful misconduct. 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 any act done or omitted
by
the Escrow Agent pursuant to the advice of the Escrow Agent's attorney-at-law
shall be conclusive evidence of such good faith.
1.10
The Escrow Agent has made no representations or warranties to Patrizio or
Dutchess in connection with this transaction. The Escrow Agent has no liability
hereunder to any Party other than to hold the Shares received by Patrizio and
to
deliver them under the terms hereof. The Escrow Agent shall have no
responsibility at any time to ascertain whether or not any security interest
exists in the Shares or any part thereof or to file any financing statement
under the Uniform Commercial Code with respect to the Shares or any part
thereof. Each Party hereto agrees to indemnify and hold harmless the Escrow
Agent from and with respect to any suits, claims, actions or liabilities arising
in any way out of this transaction including the obligation to defend any legal
action brought which in any way arises out of or is related to this Agreement
or
the investment being made by Dutchess. Dutchess acknowledges and represents
that
it is not being represented in a legal capacity by Xxxxxx X. Xxxxxxx, and has
had the opportunity to consult with its own legal advisors prior to the signing
of this Agreement. Patrizio acknowledges that the Escrow Agent is not rendering
personal advice to him with respect to this proposed transaction. Patrizio
and
Dutchess consent to Xxxxxx X. Xxxxxxx acting as the Escrow Agent. Patrizio
understands that Dutchess and Escrow Agent are relying explicitly on the
foregoing provisions contained in this Section in entering into this
Agreement.
1.11
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.
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1.12
The Escrow Agent shall not be liable in any respect on account of the identity,
authorities or rights of the Parties executing or delivering or purporting
to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
1.13
If the Escrow Agent reasonably requires other or further documents in connection
with this Agreement, the necessary Parties hereto shall join in furnishing
such
documents.
1.14
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 Shares
held by the Escrow Agent hereunder, the Escrow Agent is authorized and directed
in the Escrow Agent's sole discretion (a) to retain in the Escrow Agent's
possession without liability to anyone all or any part of said documents or
the
Shares until such disputes shall have been settled either by mutual written
agreement of the Parties concerned or by a final order, decree or judgment
of 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 (b) to deliver the
Shares 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 Commonwealth of Massachusetts in accordance with the applicable
procedure therefor.
ARTICLE
2
MISCELLANEOUS
2.1
No waiver of 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 any extension of the time for performance
of any other obligation or act.
2.2
Notices. Any
notices or other communications required or permitted to be given under the
terms of this Agreement must be in writing and will be deemed to have been
delivered (i) upon receipt, when delivered personally; (ii) upon receipt, when
sent by facsimile or electronic mail (provided confirmation of transmission
is
mechanically or electronically generated and kept on file by the sending Party);
or (iii) 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, facsimile numbers, and email addresses for such
communications shall be:
4
If
to
Patrizio to:
Xx.
Xxxx Xxxxxxxx
Chief
Executive Officer
00
Xxxxxxxxxx Xxxxxx Xxxx
Xxxxxxxxxx,
XX 00000
Phone: 000-000-0000
Fax: 000-000-0000
Email:
xxxx@xxxxxxxxxxxxxx.xxx
If
to
Dutchess to:
Dutchess
Private Equities Fund,
Ltd.
00
Xxxxxxxxxxxx Xxxxxx
Xxxxx
0
Xxxxxx,
XX 00000
Phone: 000-000-0000
Fax:
000-000-0000
Email: xxxxxx@xxxx.xxx
If
to
Escrow Agent to:
Xx.
Xxxxxx X. Xxxxxxx,
Esq.
Law
Offices of Xxxxxx X. Xxxxxxx
00
Xxxxx
Xxxxxx
Xxxxxxxxxx,
XX 00000
Phone:
000-000-0000
Fax:
973-451-1115
Email: xxx@xxx-xxxx.xxx
2.2
This Agreement shall be binding upon and shall inure to the benefit of the
permitted successors and assigns of the Parties hereto.
2.3
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.
2.4.
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 all the Parties had prepared the same. Unless
otherwise indicated, all references to Articles are to this Escrow
Agreement.
2.5
Patrizio and Dutchess acknowledge and confirm that they have had the opportunity
to consult with their own legal advisors prior to the signing of this
agreement.
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2.6
The Parties hereto expressly agree that this Escrow Agreement shall be governed
by, interpreted under, and construed and enforced in accordance of the laws
of
the Commonwealth of Massachusetts. Any action to enforce, arising out of, or
relating in any way to, any provisions of this Escrow Agreement shall be
submitted to arbitration in Boston, Massachusetts before a single arbitrator
of
the American Arbitration Association. The arbitrator shall be selected by
application of the rules of the AAA, or by mutual agreement of the parties,
except that such arbitrator shall be an attorney admitted to practice law in
the
Commonwealth of Massachusetts. No party to this agreement will challenge the
jurisdiction or venue provisions as provided in this section. Nothing in this
section shall limit the Secured Party’s right to obtain an injunction for a
breach of this Agreement from a court of law.
2.7
This Escrow Agreement may be executed in one or more counterparts, each of
which
shall be deemed an original but all of which shall constitute one and the same
agreement. This Escrow Agreement, once executed by a Party, may be delivered
to
the other Parties hereto by telephone line facsimile transmission bearing the
signature of the Party so delivering this Escrow Agreement and such copy shall
be deemed and original.
IN
WITNESS WHEREOF, the Parties hereto
have executed this Agreement as of the 14th day of January, 2008.
XXXX
XXXXXXXX.
By:
Xxxx Xxxxxxxx, individually
DUTCHESS
PRIVATE EQUITIES FUND,
LTD.
By:
Xxxxxxx
X. Xxxxxxxx ,
Director
XXXXXX
X. XXXXXXX, ESCROW
AGENT
By:
Xxxxxx X. Xxxxxxx, Esq.
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