EXHIBIT 10.8
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement") is made effective as of March 29,
2001, by and among Pro Net Link Corp., a corporation incorporated under the laws
of Nevada (the "Company"), Waveland Capital, LLC, a Colorado limited liability
company (the "Purchaser"), Xxxxxxx.xxx, (the "Placement Agent") and The Bank of
New York, having an address at Xxxxx 000, 000 Xxxxxxx Xxxxxx, Xxxxx, Xxxxxxx,
Xxxxxxx 00000 (the "Escrow Agent"). Capitalized terms used but not defined
herein shall have the meanings set forth in the Common Stock Purchase Agreement
referred to in the first recital.
RECITALS
A. The Purchaser will from time to time over an 18-month period, as
requested by the Company, purchase shares of the Company's Common Stock from the
Company as set forth in that certain Common Stock Purchase Agreement (the
"Purchase Agreement") dated March 29, 2001, between the Purchaser and the
Company. Under the terms of the Purchase Agreement, the Company will from time
to time (but with a minimum of 15 days between Puts) put shares of its
registered common stock to the Purchaser. The maximum number of Shares that may
be put during any Put Period is equal to 15% of the aggregate trading volume of
the Company's common stock as traded on the Principal Market during the 20
consecutive Trading Days immediately preceding the date of the Put Notice. The
Purchaser will pay for the Put Shares on the 14th Trading Day following the date
of the Put Notice. The Purchaser will deliver by wire transfer to the Escrow
Agent the total purchase price for the Shares and will also deliver a
calculation of the purchase price. The Escrow Agent will disburse the funds to
the Company and the Purchaser as set forth below.
B. The Company and the Purchaser have requested that the Escrow Agent, upon
each exercise of a Put, hold the relevant documents including the certificates
representing the securities issuable upon such Put and disburse the funds to the
Company payable by the Purchaser for the Put Shares.
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:
AGREEMENTS
ARTICLE I
GENERAL TERMS OF THE ESCROW
SECTION 1.1. The parties hereby agree to establish an escrow account with
the Escrow Agent. The Escrow Agent shall hold the funds and documents as set
forth below.
SECTION 1.2. Within 20 Trading Days following execution of the Purchase
Agreement, the parties shall deliver to the Escrow Agent:
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(i) the original executed Registration Rights Agreement;
(ii) the original executed Escrow Agreement executed in by Purchaser and
the Company;
(iii) the original executed Purchase Agreement;
(iv) the original executed Performance Warrant, and Undrawn Minimum
Warrant; and
(v) current financial statements of the Company
SECTION 1.3. Wire transfers to the Escrow Agent (not address for notice or
delivery of documents) shall be made as follows:
Bank: The Bank of New York
ABA #
GLA #
Reference TAS # _________________, XYZ Investment Company
Attn:
Only wire transfers shall be accepted.
ARTICLE II
TERMS OF THE ESCROW FOR EACH PUT AND
FOR EXERCISE OF WARRANTS
SECTION 2.1. Each time the Company sends a Put Notice to the Purchaser as
provided in the Purchase Agreement, it shall also send a copy of such Put
Notice, by facsimile, to the Escrow Agent and shall further deliver to the
Escrow Agent within one Trading Day of the Put Notice one or more stock
certificates of the Company (free and clear of all legends or other restrictions
of any kind whatsoever) for the number of Shares equal to the Put Shares (the
"Put Certificates"). The Company shall also deliver to the Escrow Agent the
original executed attorney's opinion in the form of Exhibit D to the Purchase
Agreement (the "Opinion") to the Purchaser. Escrow Agent shall give notice to
Purchaser by facsimile within one Trading Day following receipt of the Put
Certificates and the Opinion that Escrow Agent has received the Put Certificates
and the Opinion.
SECTION 2.2. Each time the Purchaser shall purchase Shares pursuant to a
Put, the Purchaser shall wire to the Escrow Agent funds equal to the Purchase
Price (as defined in the Purchase Agreement) for the Put Shares in the amount
and pursuant to the schedule set forth in the Purchase Agreement. Each such
funding shall be accompanied by a Statement of Determination of Market Price in
the form as attached hereto as Exhibit A (the "Statement"), which Statement
shall further set forth the Purchase Price. Purchaser shall send to the Company
a copy of the Statement at least two Trading Days prior to any Settlement Date.
Upon receipt of such funds and the Statement, the Escrow Agent shall send the
Company by facsimile a copy of the Statement and shall provide notice that it
has received the funds for such Put Shares.
SECTION 2.3. Upon receipt of written confirmation from the transfer agent
or from the Purchaser that such Put Shares have been transferred to the
Purchaser and the Opinion and the supplemental prospectus have been delivered to
the Purchaser, the Escrow Agent shall, within one Trading Day of the
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receipt of such notice, wire funds equal to the Purchase Price (as defined in
the Purchase Agreement) of the Put Shares per the written instructions of the
Company, net of $__ as escrow expenses to the Escrow Agent.
SECTION 2.4. In the event that the Put Shares are not transferred to the
Purchaser's account and the Opinion and supplemental prospectus are not
delivered to the Escrow Agent as provided above, then Purchaser shall have the
right to declare, by written notice, the Put Notice cancelled.
SECTION 2.5. Within three Trading Days following the Settlement Date on
which the Company has received a cumulative total of $2,500,000 from the
Purchaser for the purchase of the Put Shares, the Escrow Agent shall deliver to
the Purchaser the original Performance Warrant. The Escrow Agent shall fill in
the number of Warrant Shares and amount of the Exercise Price in the first
paragraph of the Performance Warrant pursuant to the Statement of Determination
of Performance Warrant Exercise Price in the form as attached hereto as Exhibit
B (the "Performance Warrant Statement"). The Performance Warrant Statement shall
be delivered to the Company not more than two Trading Days following the
Settlement Date on which the Company received funds that brought the cumulative
total of funds received from the Purchaser to $2,500,000. The Performance
Warrant Statement shall be delivered to the Escrow Agent by the Purchaser
pursuant to the notice provisions of Section 3.10 below. The notice shall affirm
that the Company has received a cumulative total of $2,500,000 from the
Purchaser from the sale of Put Shares. The Escrow Agent shall deliver to the
Purchaser the Performance Warrant within two Trading Days following its receipt
of the Performance Warrant Statement.
SECTION 2.6. Provided that the Performance Warrants have not been delivered
to Purchaser as provided herein, on the earlier of (i) September 29, 2002, or
(ii) the termination of the Purchase Agreement for any reason (except for
termination by the Company pursuant to Section 7.2(c) of the Purchase
Agreement), the Escrow Agent shall deliver to the Purchaser the original Undrawn
Minimum Warrant. The Escrow Agent shall fill in the number of Warrant Shares and
amount of the Exercise Price in the first paragraph of the Undrawn Minimum
Warrant pursuant to the Statement of Determination of Undrawn Mimimum Warrant
Exercise Price in the form as attached hereto as Exhibit C (the "Undrawn Minimum
Warrant Statement"). The Undrawn Minimum Warrant Statement shall be delivered to
the Company and to the Escrow Agent by the Purchaser pursuant to the notice
provisions of Section 3.10 below. The Escrow Agent shall deliver the Undrawn
Minimum Warrant within two Trading Days following its receipt of the Undrawn
Mimimum Warrant Statement. If Purchaser delivers the Undrawn Mimimum Warrant
Statement prior to September 29, 2001, Purchaser shall affirm that the Purchase
Agreement is terminated for reasons other than as set forth in Section 7.2 of
the Purchase Agreement.
SECTION 2.7. If the Company objects to the calculation set forth in either
the Performance Warrant Statement or the Undrawn Minimum Warrant Statement, as
the case may be, then the Company shall give notice to Purchaser within one
Trading Day following delivery of such Statement. The parties shall make a good
faith attempt to resolve any discrepancy in such Statement. If they are unable
to resolve such discrepancy, the determination of the disputed issues shall be
made by a representative of Bloomberg Financial L.P., and the cost of such
determination shall be divided evenly between Purchaser and the Company.
ARTICLE III
MISCELLANEOUS
SECTION 3.1 Escrow Agent shall not be liable to anyone for any damages,
losses, or expense which they may incur as a result of any act or omission of
Escrow Agent, unless such damages, losses, or expenses are caused by Escrow
Agent's willful misconduct or gross negligence. Accordingly, Escrow
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Agent shall not incur any such liability with respect to (i) any action taken or
omitted in good faith upon the advice of Escrow Agent's counsel or counsel for
any other party hereto, given with respect to any question relating to the
duties and responsibilities of Escrow Agent under this Agreement or (ii) any
action taken or omitted in reliance upon any instrument, including execution, or
the identity or authority of any person executing such instrument, its validity
and effectiveness, but also as to the truth and accuracy of any information
contained therein which Escrow Agent shall, in good faith, believe to be
genuine, to have been signed by a proper person or persons and to conform to the
provisions of this Escrow Agreement.
SECTION 3.2 Escrow Agent shall not be bound in any way by any contract or
agreement between other parties hereto, whether or not it has knowledge of any
such contract or agreement or of its terms or conditions.
SECTION 3.3 The parties hereto, jointly and severally, hereby agree to
indemnify and, hold harmless Escrow Agent against any and all costs, losses,
claims, damages, liabilities, expenses, including reasonable costs of
investigation, court costs, and attorney's fees, and disbursements, which may be
imposed upon Escrow Agent in connection with its acceptance of appointment as
Escrow Agent hereunder, including any litigation arising from this Escrow
Agreement or involving the subject matter hereof, and all such costs, expenses
and disbursements shall be deducted from the income (if sufficient) or paid by
the parties hereto, except for matters arising from the gross negligence or
willful misconduct of Escrow Agent.
SECTION 3.4 As security for such fees and expenses of Escrow Agent and any
and all losses, claims, damages, liabilities and expenses incurred by Escrow
Agent in connection with its acceptance of appointment hereunder, and with
performance of the agreements herein contained, the Escrow Agent is hereby given
a lien upon all assets held by Escrow Agent hereunder, which lien shall be prior
to all other liens upon or claims against such assets.
SECTION 3.5 In the event of any disagreement among any of the parties to
this Agreement, or among them or any other person resulting in adverse claims
and demands being made in connection with or from any property involved herein
or affected hereby, Escrow Agent shall be entitled to refuse to comply with any
such claims or demands as long as such disagreement may continue, and in so
refusing, shall make no delivery or other disposition of any property then held
by it under this Escrow Agreement, and in so doing the Escrow Agent shall be
entitled to continue to refrain from acting until (a) the right of adverse
claimants shall have been finally settled by binding arbitration or finally
adjudicated in a court assuming and having jurisdiction of the property involved
herein or affected hereby or (b) all differences shall have been adjusted by
agreement and Escrow Agent shall have been notified in writing of such agreement
signed by the parties hereto.
SECTION 3.6 In the event of such disagreement (or resignation under the
terms of this Agreement), Escrow Agent may, but need not, tender into the
registry or custody of any court of competent jurisdiction all, money or
property in its hands under the terms of this Agreement, together with such
legal proceedings as it deems appropriate and thereupon to be discharged from
all further duties under this Escrow Agreement. The filing of any such legal
proceeding shall not deprive Escrow Agent of its compensation earned prior to
such filing.
SECTION 3.7 Escrow Agent shall have no obligation to take any legal, action
in connection with this Escrow Agreement or towards its enforcement, or to
appear in, prosecute or defend any action or legal proceeding which would or
might involve it in any cost, expense, loss or liability unless security and
indemnity shall be furnished.
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SECTION 3.8 This Agreement contains the entire understanding between and
among the parties hereto, and shall be binding upon and inure to the benefit of
such parties, and subject to its terms, their respective successors, heirs,
assigns and legal representatives. Any corporation into which Escrow Agent may
be merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which Escrow Agent
shall be a party, or any corporation to which substantially all the corporate
trust business of Escrow Agent may be transferred, shall, subject to the terms
of the Escrow Agreement, be Escrow Agent under this Escrow Agreement without
further act.
SECTION 3.9 This Escrow Agreement is being delivered in and shall be
governed by and construed and enforced in accordance with the laws of the State
of Delaware without giving effect to the principles or rules governing conflicts
of laws.
SECTION 3.10 Notices, requests, demands or other communications required or
permitted under this Escrow Agreement will be in writing and will be deemed
given when actually delivered, received via facsimile notice for which a
confirmation is received, or the third business day after said notice has been
sent by certified mail, postage prepaid, return receipt requested to:
If to Escrow Agent: The Bank of New York
Suite 520
000 Xxxxxxx Xxxxxx, Xxxxx
Xxxxxxx, Xxxxxxx 00000
Tel: _______________
Fax: _______________
E-mail: _______________
Attention: ________________
If to Company: Pro Net Link Corp.
000 Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxx@xxxxxxxxxx.xxx
Attention: Xxxxx Xxxxxx
With copies to: Kronish Xxxx Xxxxxx & Xxxxxxx LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxxx@xxxxxxx.xxx
Attention: Xxxxxx Xxxxxxx
If to Purchaser: Waveland Capital, LLC
00000 X. Xxxx Xxxxxxxxxx Xxxx
Xxxxx 000
Xxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxx@xxxxxxxxxxxxxxxxxx.xxx
Attention: D. Xxxx Xxxxx
With copies to: Xxxxxxxx Xxxx Killin Brittan & Ray, LLC
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000 Xx. Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
E-mail: xxxxxxxxx@xxxxxxxxxxxx.xxx
Attn: Xxxxxxx X. Xxxxxxxx
If to Placement Agent: Xxxxxxx.xxx
0000 Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
E-Mail: xxxxxx@xxxxxxx.xxx
Attn: Xxxxxx Xxxxxx
or such other address as a party may specify in writing to other
parties pursuant hereto.
SECTION 3.11 This Escrow Agreement shall not be modified, revoked, released
or terminated except in writing and signed by the parties hereto.
SECTION 3.12 Should, at any time, any attempt be made to modify this Escrow
Agreement in a manner that would increase the duties and responsibilities of
Escrow Agent, or to modify this Escrow Agreement in any matter which Escrow
Agent shall deem undesirable, or at any other time, Escrow Agent may resign by
notifying the parties in writing, by certified mail to their respective
addresses here and above set forth. Until (i) the acceptance by such successor
Escrow Agent as shall be appointed by such parties; or (ii) 60 days following
the date upon which notice was mailed, whichever occurs sooner, Escrow Agent's
only remaining obligation shall be to perform its duties hereunder in accordance
with the terms of this Escrow Agreement. If said 60 days have passed without the
acceptance by such successor Escrow Agent as shall have been appointed by such
parties, then the Escrow Agent may exercise its rights under item 8(b) (ii) of
this Agreement.
SECTION 3.13 The Escrow Agent undertakes to perform only such duties as are
expressly set forth herein and no additional duties or obligations shall be
implied hereunder. The parties hereby acknowledge that the Escrow Agent is
serving as the Escrow Agent of the Offering for the limited purposes set forth
herein, and hereby agree that they will not represent or imply that the Escrow
Agent, by serving as the escrow agent hereunder or otherwise, has investigated
the desirability or advisability of this investment, or has approved, endorsed
or passed upon the merits of this Offering or any related, offering. It is
further agreed that no party shall in any way use the name "The Bank of New
York" in any sales presentation or literature except in, the context of the
duties of the Escrow Agent as escrow agent of the Offering in the strictest
sense. Any breach or violation of this paragraph (h) shall be grounds for the
immediate resignation by the Escrow Agent. This Escrow Agreement may be executed
in two (2) 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.
Executed as of this 29th day of March, 2001.
PRO NET LINK CORP.
By:
---------------------------------------
Xxxx Xxxxxx Collardeau, President and CEO
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WAVELAND CAPITAL, LLC
By:
---------------------------------------
D. Xxxx Xxxxx, Manager
ESCROW AGENT:
THE BANK OF NEW YORK
By: ___________________________
Its ___________________
PLACEMENT AGENT:
XXXXXXX.XXX
By: __________________________
Its __________________
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