ESCROW AGREEMENT
EXHIBIT
10.2
This
Escrow Agreement (the “Agreement”) is made
and entered into as of August 29, 2008 by and between Adex Media, Inc., a
Delaware corporation (the “Buyer”), Bay Harbor
Marketing, LLC, a California limited liability company (the “Company”), and
Bullivant Xxxxxx Xxxxxx PC (the “Escrow
Agent”).
RECITALS
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A.
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Company
and Buyer are parties to that certain Asset Purchase Agreement of even
date herewith, a copy of which is attached hereto as Exhibit A
(the “Asset
Purchase Agreement”);
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B.
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Pursuant
to the Asset Purchase Agreement, the Company and Buyer agree to deposit
into escrow, upon the closing of the Asset Purchase Agreement, (a) 150,000
restricted shares of the Buyer’s common stock in the name of the Company
(the “Escrow
Shares”), and (b) stock powers relating to the Escrow Shares, in
form and substance satisfactory to the Escrow Agent and duly executed in
blank by the Company (the “Stock
Powers”);
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C.
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Concurrently
with the deposit of the Escrow Shares and Stock Powers, the Company and
Buyer each agree to provide to the Escrow Agent certified resolutions
authorizing the Escrow Agent to act as escrow agent in accordance with the
terms and conditions of this Agreement (the “Resolutions”);
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D.
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Company
and Buyer each acknowledge and agree that the Escrow Agent will receive,
hold and deliver the Escrow Shares and Stock Powers, and the Escrow Agent
consents to receive, hold and deliver the Escrow Shares and Stock Powers,
in accordance with this Agreement;
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E.
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Except
as otherwise provided in this Agreement, capitalized terms used herein
have the meanings assigned to them in the Asset Purchase Agreement and
this is the Escrow Agreement referred to in the Asset Purchase
Agreement;
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AGREEMENT
Now,
therefore, in consideration of the foregoing, the mutual covenants and promises
contained herein, and other good and valuable consideration, the parties hereto
agree as follows:
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1.
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Appointment of Escrow
Agent. Company and Buyer hereby appoint the Escrow Agent
as their joint agent for the purpose of receiving, holding and delivering
the Escrow Shares pursuant to the terms of this
Agreement.
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2.
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Delivery of Escrow
Shares. Upon closing of the Asset Purchase Agreement,
the Company shall deliver the Stock Powers to the Escrow
Agent. Buyer shall deliver a certificate or certificates
evidencing the Escrow Shares to the Escrow Agent as soon as is practicable
following closing of the Asset Purchase
Agreement.
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1
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3.
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Escrow
Shares.
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3.1
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The
Escrow Agent shall hold the Escrow Shares until receipt of instructions
from Buyer pursuant to Section 2.3.1(e) of the Asset Purchase
Agreement.
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3.2
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The
Escrow Agent is not the transfer agent of the Escrow Shares. If
the Asset Purchase Agreement requires the release and delivery of the
Escrow Shares, delivery shall be made by Escrow Agent instructing Buyer’s
stock transfer agent to deliver certificates to the party to whom delivery
of the Escrow Shares is to be made. Buyer agrees to use commercially
reasonable efforts to cause its stock transfer agent to cause the delivery
of certificates in the manner required by the Asset Purchase Agreement and
instructed by Escrow Agent.
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4.
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Term. The
term of this Agreement shall begin upon execution by all parties hereto
and shall end upon the release from escrow of the Escrow Shares as
provided by the Asset Purchase Agreement, whereupon all duties of the
Escrow Agent hereunder shall
terminate.
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5.
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Expenses. All
expenses incurred by Escrow Agent in the course of administering the
escrow provided for by this Agreement, other than expenses relating to any
controversy concerning this Agreement, shall be paid solely by
Buyer.
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6.
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Duties of Escrow
Agent. Escrow Agent agrees to act as escrow agent and
receive, hold and deliver the Escrow Shares pursuant to the terms of this
Agreement; provided, however, that
the Escrow Agent undertakes to perform only such duties as are expressly
set forth herein, and no implied duties or obligations shall be imposed
upon Escrow Agent in connection with this Agreement. Escrow
Agent shall not be responsible or liable for the sufficiency, correctness,
authenticity or validity of any instrument deposited with Escrow Agent
hereunder, or the identity, authority or right of any person executing or
depositing the same. Escrow Agent shall have no duties to any
person or entity other than the parties to this
Agreement.
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7.
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Rights and Liabilities
of the Parties. Escrow Agent shall have the right to act
upon any written or electronic notice, instruction, request, waiver,
consent, document or communication believed by the Escrow Agent to be
genuine and to be signed by the proper party or parties. Escrow Agent
shall not be liable for, and Company and Buyer agree to indemnify, defend
and hold Escrow Agent harmless from and against, all liability for any
error of judgment or for any act done or step taken or omitted by Escrow
Agent in good faith, or for any mistake of fact or law, of for anything
which it may do or refrain from doing in connection herewith, except
through its own gross negligence or willful
misconduct.
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8.
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Force
Majeure. The Escrow Agent shall not be responsible for
delays or failures in performance resulting from acts beyond its
control. Such acts shall include, but not be limited to, acts
of God, strikes, lockouts, riots, acts of war, epidemics, subsequent
governmental regulations, fire, communication-line failures, computer
viruses, power failures, network failures, or similar
events.
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2
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9.
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Resignation. Escrow
Agent may resign at any time for any reason upon thirty days’ written
notice to Company and Buyer. If the Company and Buyer do not
deliver to Escrow Agent a joint notice of appointment of a lawful
successor escrow agent within such thirty-day period, Escrow Agent may
petition any court of competent jurisdiction to appoint a lawful successor
escrow agent, and Company and Buyer shall jointly and severally indemnify
and hold Escrow Agent harmless against any and all reasonable legal and
other fees and costs incurred in connection with such
petition. Upon the appointment of a successor escrow agent,
Escrow Agent shall be fully relieved of all liability under this Agreement
to all parties upon the transfer of and accounting for the escrow deposits
to such successor escrow agent.
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10.
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Voting
Rights.
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10.1
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For
so long as the Escrow Agent holds Escrow Shares under this Agreement, the
registered owner of the Escrow Shares may (i) exercise any and all voting
and other consensual rights pertaining to any of the Escrow Shares and
(ii) act, or refrain from acting, in any manner which such registered
owner may deem necessary or advisable with respect to the Escrow Shares
until such Escrow Shares are transferred to Buyer or cancelled; provided, however, that
nothing in this Section 10
shall authorize or permit the Company to act, or fail to act, in any
manner which would violate or be inconsistent with any of the terms of
this Agreement or the Asset Purchase
Agreement.
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10.2
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All
dividends and distributions on the Escrow Shares, payable in cash,
securities or other property (including, without limitation, pursuant to
any stock split, reverse stock split, stock combination or
reclassification of Buyer’s common stock or any merger, consolidation or
combination of Buyer with any other entity or entities), shall become part
of the escrow fund and shall be held in escrow in accordance with the
terms of this Agreement; provided, however, that
the registered owner of the Escrow Shares shall include such dividends and
distributions in its taxable income and shall pay all taxes arising
therefrom. If the Company receives any such dividends or distributions
directly during the term of this Agreement, the Company shall hold such
dividends or distributions in trust for the parties to this Agreement, and
shall forthwith deliver the same to the Escrow
Agent.
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11.
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No
Encumbrance. Company may not pledge, sell, assign or
transfer any Escrow Shares or any beneficial interest in any Escrow
Shares, including by operation of law or equity in satisfaction of any
debt or other liability of the Company, prior to the delivery to the
Company of the Escrow Shares pursuant to this
Agreement.
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12.
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Legends.
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12.1
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All
certificates evidencing shares of Escrow Stock shall bear the following
legend:
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3
THE
SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE OFFERED, SOLD, PLEDGED,
EXCHANGED, TRANSFERRED OR OTHERWISE DISTRIBUTED OR DISPOSED EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF THAT CERTAIN ESCROW AGREEMENT, DATED AS OF AUGUST __,
2008, A COPY OF WHICH IS AVAILABLE FROM THE ISSUER’S PRINCIPAL EXECUTIVE
OFFICE.
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12.2
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Notwithstanding
the foregoing, Escrow Agent shall not be responsible for placing legends
on certificates delivered to Escrow Agent or for changing such legends at
any time.
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13.
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Dissolution of the
Company.
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13.1
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If
the Company is lawfully dissolved, the Company shall have the right to
transfer its rights and obligations under this Agreement and its rights to
the Escrow Shares to a liquidating trustee designated by the Company (the
“Liquidating
Trustee”), subject to the terms and conditions of this
Agreement. In such event, Company shall deliver to Buyer and
Escrow Agent (i) a certificate executed by an authorized officer of the
Company stating that the Company has been lawfully dissolved, and (ii) a
notice specifying the name, address and taxpayer identification number of
the Liquidating Trustee, in each case in form and substance satisfactory
to the Escrow Agent and duly executed by the
Company.
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13.2
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Within
twenty days after receipt of the items listed in Section 13.1 above, Buyer shall cause a
certificate representing the Escrow Shares to be issued in the name of the
Liquidating Trustee and delivered to Escrow Agent in escrow hereunder and
shall direct the Escrow Agent to surrender the original certificate
representing the Escrow Shares in the name of the Company to Buyer’s
transfer agent for cancellation; provided, however, that
issuance of a stock certificate in the name of the Liquidating Trustee
shall be made against receipt of stock powers relating to such new
certificate in form and substance satisfactory to Escrow Agent and duly
executed in blank by the Company.
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13.3
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After
the dissolution of the Company and the issuance of a certificate in the
name of the Liquidating Trustee, the Liquidating Trustee shall be bound
by, and obligated to observe and perform, all of the terms and conditions
of this Agreement to the extent that the Company would have been so bound
or obligated if the Company had not
dissolved.
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13.4
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Except
as provided in this Section 13, the Escrow Agent shall have no
obligation to the Company or its members to issue additional stock
certificates or replacement stock certificates upon a dissolution of the
Company and the dissolution of the Company shall not otherwise affect the
Escrow Shares or alter the terms of this
Agreement.
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14.
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Notices. All
notices, requests, claims, demands and other communications hereunder
shall be in writing and shall be given or made (and shall be deemed to
have been duly given or made upon receipt) by delivery in person, by
courier service, by facsimile or by registered or certified mail (postage
prepaid, return receipt requested) to the respective parties at the
following addresses (or at such other address for a party as shall be
specified in a notice given in accordance with this Section 14:
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14.1
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If
to the Company:
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Bay
Harbor Marketing, LLC
000
Xxxxxx Xxxxxx, Xxxxx 000
Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxx
Xxxxxxx
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14.2
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If
to Buyer:
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000 Xxxxx
Xxxxxxxxx Xxxx. #X000
Xxxxxxxx
Xxxx, XX 00000
Attn: Xxx
Xxxxx, Chief Financial Officer
Fax:
(000) 000-0000
with a
copy to:
Bullivant
Xxxxxx Xxxxxx PC
000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxxxxxxx, XX 00000
Attn:
Xxxx X. Xxxxxxx
Fax:
(000) 000-0000
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14.3
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If
to Escrow Agent:
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Bullivant
Xxxxxx Xxxxxx PC
000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx
Xxxxxxxxx, XX 00000
Attn:
Xxxx X. Xxxxxxx
Fax:
(000) 000-0000
5
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15.
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Amendment and
Waivers. This Agreement may not be altered or modified
without the express written consent of the parties hereto. No
course of conduct shall constitute a waiver of any of the terms and
conditions of this Agreement, unless such waiver is specified in writing,
and then only to the extent so specified. A waiver of any of
the terms and conditions of this Agreement on one occasion shall not
constitute a waiver of any other term or condition of this Agreement, or
of the same terms and conditions on any other occasion. The
waiver by a party of a breach of this Agreement on one occasion shall not
be deemed to constitute a waiver of any other breach or the same breach on
any other occasion.
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16.
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Further
Assurances. Each party agrees to cooperate fully with
the other parties and to execute such further instruments, documents and
agreements and to give such further written assurances, as may be
reasonably requested by any other party to better evidence and reflect the
transactions described herein and contemplated hereby and to effect the
intents and purposes of this
Agreement.
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17.
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Conflicts. The
parties acknowledge that the Escrow Agent has acted as counsel to Buyer in
connection with this Agreement, the Asset Purchase Agreement, and other
matters, and that in the event of any dispute with respect to this
Agreement, Escrow Agent shall be entitled to continue to act as counsel
to Buyer and its subsidiaries and affiliates, including,
without limitation, with respect to any dispute arising under or related
to this Agreement or the Asset Purchase Agreement or any of the
transactions contemplated hereby or thereby or under any of the
instruments or agreements executed or delivered in connection therewith or
herewith, regardless of any conflicts which this may present with respect
to its role as escrow agent
hereunder.
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18.
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Headings. The
headings contained in this Agreement are for convenience of reference only
and shall not affect in any way the meaning or interpretation of this
Agreement.
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19.
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Entire
Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and undertakings, both written and
oral, among Buyer, the Company, and the Escrow Agent with respect to the
subject matter hereof except for the Asset Purchase Agreement, which shall
continue in full force and effect in accordance with its
terms.
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20.
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Binding Effect; No
Third-Party Beneficiaries. All provisions of this Agreement shall
be binding on, inure to the benefit of, and be enforceable by and against
the parties and their respective heirs, executors, administrators,
personal representatives, successors and assigns. Nothing
herein, express or implied, is intended to or shall confer upon any other
person or entity any legal or equitable right, benefit or remedy of any
nature whatsoever under or by reason of this
Agreement.
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21.
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Governing
Law. This Agreement (including any claim or controversy arising
out of or relating to this Agreement)
shall be governed by the law of the State
of California without regard to conflict of law principles that would
result in the application of any law other than the law of the State of
California.
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22.
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Counterparts. This
Agreement may be executed in one or more counterparts, and by the
different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original, and all of which taken
together shall constitute one and the same
agreement.
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[Signature
Page Follows]
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IN
WITNESS WHEREOF, each of the Company, the Buyer, and the Escrow Agent has caused
this Agreement to be executed by its respective duly authorized
representative.
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By:
Name:
Title:
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Bay
Harbor Marketing, LLC
By:
Name: ________________________
Title: ________________________
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Bullivant
Xxxxxx Xxxxxx PC
By:
Name:
Title:
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10748076.3
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EXHIBIT A
ASSET
PURCHASE AGREEMENT
9
