CLOSING ESCROW AGREEMENT
CLOSING
ESCROW AGREEMENT,
dated
November 17,
2007
(“Escrow
Agreement”),
is
entered into by and between New Paradigm Productions, Inc., a Nevada corporation
which will change its corporate name to China Marine Food Group Limited (the
“Company”),
Xxxxxx Xxxx Xxxxx Raysman & Xxxxxxx LLP, as escrow agent (the “Escrow
Agent”)
and
Sterne Agee & Xxxxx, Inc., as placement agent (“Sterne
Agee”).
BACKGROUND
Concurrently
herewith the Company, Xxxxxxx Xxx, as the make good pledgor and certain
Investors are entering into a Securities Purchase Agreement, dated as of
the
date hereof (the “Purchase
Agreement”),
pursuant to which each Investor (as defined therein) has agreed to purchase
from
the Company, and the Company has agreed to sell to each Investor, the number
of
Units identified therein (capitalized terms used and not otherwise defined
herein shall have the meanings given such terms in the Purchase
Agreement).
Pursuant
to the Purchase Agreement, the Company and the Investors have agreed to
establish an escrow on the terms and conditions set forth in this Escrow
Agreement and the Escrow Agent is willing to accept appointment as Escrow
Agent
for only the expressed duties outlined herein.
NOW,
THEREFORE,
in
consideration of the premises set forth above and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
1.
Proceeds
to be Escrowed. A
copy of
the Purchase Agreement is attached as Exhibit
A.
All
amounts provided by the Investors in connection with their acquisition of
the
Units as set forth in the Purchase Agreement shall be deposited directly
with
the Escrow Agent in immediately available funds by federal wire transfer,
such
funds being referred to herein as the “Escrow
Funds.”
The
Escrow Funds shall be retained in escrow by the Escrow Agent in a separate
account and invested as stated below.
2.
Identity
of Investors. Concurrent
with the execution of the Escrow Agreement, the Company shall furnish to
the
Escrow Agent the information comprising the identity of the Investors in
the
format set forth in the “List
of Investors”
attached as Exhibit
B,
or in
an electronic spreadsheet format with the same information. All Escrow Funds
shall remain the property of the Investors and shall not be subject to any
liens
or charges by the Company or the Escrow Agent or judgments or creditors'
claims
against the Company, until released to the Company as hereinafter provided.
Escrow Agent will not use the information provided to it by the Company for
any
purpose other than to fulfill its obligations as Escrow Agent. The Company
and
the Escrow Agent will treat all Investor information as
confidential.
3.
Disbursement
of Funds.
(a) The
Escrow Agent shall continue to hold the Escrow Funds delivered for deposit
hereunder by an Investor until the earlier of: (1) receipt of a joint written
notice from the Company and the Investors evidencing termination under Section
7.5(a) of the Purchase Agreement, (2) receipt of a written notice from the
Company or such Investor evidencing termination under Section 7.5(b) of the
Purchase Agreement (each of (1) and (2), a “Termination
Election”)
and
(3) receipt of both (x) written notice from the Company that the conditions
to
closing under Section 6.1 of the Purchase Agreement have been satisfied and
(y)
joint written notice from the Company and Sterne Agee, who acted as placement
agent in connection with the transactions contemplated by the Purchase
Agreement, to effect the Closing.
(b) If
the
Escrow Agent receives a Termination Election prior to its receipt of the
notices
contemplated under Section 3(a)(3), then the Escrow Agent shall return the
Escrow Funds delivered by such Investor as directed by such Investor. If
the
Escrow Agent receives the notices contemplated under Section 3(a)(3) prior
to a
Termination Election, then the Escrow Agent shall disburse the portion of
the
Escrow Funds for which the foregoing is the case in accordance with Exhibit
C
to this
Escrow Agreement.
4.
Duty
and Limitation on Liability of the Escrow Agent. The
sole
duty of the Escrow Agent shall be to receive the Escrow Funds and to hold
them
subject to release, in accordance herewith, and the Escrow Agent shall be
under
no duty to determine whether the Company is complying with requirements of
the
Escrow Agreement or the Purchase Agreement. The Escrow Agent may conclusively
rely upon and shall be protected in acting upon any statement, certificate,
notice, request, consent, order or other document believed by it to be genuine
and to have been signed or presented by the proper party or parties. The
Escrow
Agent shall have no duty or liability to verify any such statement, certificate,
notice, request, consent, order or other document, and its sole responsibility
shall be to act only as expressly set forth in the Escrow Agreement. The
Escrow
Agent shall be under no obligation to institute or defend any action, suit
or
proceeding in connection with the Escrow Agreement unless first indemnified
to
its satisfaction. The Escrow Agent may consult counsel of its own choice
with
respect to any question arising under the Escrow Agreement and the Escrow
Agent
shall not be liable for any action taken or omitted in good faith upon advice
of
such counsel.
In
no
event shall the Escrow Agent be liable, directly or indirectly, for any (a)
damages or expenses arising out of the services provided hereunder, other
than
damages which result from the Escrow Agent’s gross negligence or willful
misconduct or (b) special or consequential damages, even if the Escrow Agent
has
been advised of the possibility of such damages.
The
Escrow Agent shall be obligated only to perform the duties specifically set
forth in this Escrow Agreement, which shall be deemed purely ministerial
in
nature, and shall under no circumstances be deemed to be a fiduciary to the
Company, Sterne Agee or any other person. The Escrow Agent shall not assume
any
responsibility for the failure of the Company to perform in accordance with
this
Escrow Agreement. This Escrow Agreement sets forth all matters pertinent
to the
escrow contemplated hereunder, and no additional obligations of the Escrow
Agent
shall be implied by nor inferred from the terms of any other agreement,
including, without limitation, the Purchase Agreement.
Under
no
circumstances shall the Escrow Agent be expected or required to use, risk
or
advance its own funds in the performance of its duties or exercise of its
rights
hereunder.
The
Investors (by agreeing to use this form of Closing Escrow Agreement) and
the
Company acknowledge that they are aware that the Escrow Agent has represented
Sterne Agee in connection with the Purchase Agreement and this Escrow Agreement
and that Escrow Agent may continue to represent Sterne Agee in that connection
and in connection with the transactions contemplated by those agreements,
including, but not limited to, in connection with any disputes that may arise
under either of those agreements. The Escrow Agent shall not be precluded
from
or restricted from representing Sterne Agee or any of its affiliates or
otherwise acting as attorneys for Sterne Agee or any of its affiliates in
any
matter, including, but not limited to, any court proceeding or other matter
related to the Purchase Agreement or the transactions contemplated by the
Purchase Agreement, or this Escrow Agreement or the Escrow Funds, whether
or not
there is a dispute between the Investors, Sterne Agee and/or the Company
with
respect to any such matter.
5.
Interpleader.
The
Escrow Agent may at any time commence an action in the nature of interpleader
or
other legal proceedings and may deposit the Escrow Deposit with the clerk
of the
court. In the event of any dispute regarding who is entitled to the Escrow
Deposit at any time, the Escrow Agent may determine not to release the Escrow
Deposit to either any Investor or the Company and may commence an interpleader
action as aforesaid or may cause the Escrow Deposit to be deposited with
a court
of competent jurisdiction whereupon it shall cease to have any further
obligation hereunder. Upon any delivery or deposit of the Escrow Deposit
as
provided in this Section 5, the Escrow Agent shall be released and discharged
from any further obligation under this Agreement.
6.
Investment
of Proceeds. The
Escrow Funds shall be credited by Escrow Agent and recorded in a non-interest
bearing escrow account. The
Company agrees to indemnify and hold Escrow Agent harmless from and against
any
taxes, additions for late payment, interest, penalties and other expenses
that
may be assessed against Escrow Agent on or with respect to any payment or
other
activities under this Escrow Agreement unless any such tax, addition for
late
payment, interest, penalties and other expenses shall arise out of or be
caused
by the gross negligence or willful misconduct of the Escrow Agent.
The
Company acknowledges that Escrow Agent is not providing investment supervision,
recommendations or advice.
7.
Notices.
All
notices, requests, demands and other communications under the Escrow Agreement
shall be in writing and shall be deemed to have been duly given (a) on the
date
of service if served personally on the party to whom notice is to be given,
(b)
on the day of transmission if sent by facsimile/email transmission to the
facsimile number/email address given below, and telephonic confirmation of
receipt is obtained promptly after completion of transmission, (c) on the
day
after delivery to Federal Express or similar overnight courier or the Express
Mail service maintained by the United States Postal Service or (d) on the
fifth
day after mailing, if mailed to the party to whom notice is to be given,
by
first class mail, registered or certified, postage prepaid, and properly
addressed, return receipt requested, to the party as follows:
|
If
to the Company:
|
China
Marine Food Group Limited
|
|
c/o
Huabao Mingxiang Foodstuff Co., Ltd.
|
|
|
Da
Bao Industrial Zone
|
|
|
Shishi
Fujian
|
|
|
People’s
Republic of China
|
|
|
Attn:
Xx. Xxxxxxx Xxx, Chief Executive Officer
|
|
|
Facsimile:
00-000-00000000
|
|
If
to Escrow Agent:
|
Xxxxxx
Xxxx Xxxxx Raysman & Xxxxxxx LLP
|
|
000
Xxxxx Xxxxxx
|
|
|
Xxx
Xxxx, Xxx Xxxx 00000
|
|
|
Attn:
Xxxxx X. Xxxxxxx, Esq.
|
|
|
Facsimile:
(000) 000-0000
|
|
|
If
to Sterne Agee:
|
Sterne
Agee & Xxxxx, Inc.,
|
|
0000
X. Xxxxx Xxxxxxx, Xxx. 000
|
|
|
Xxxxxxx
Xxxxx, XX 00000
|
|
|
Attn:
Xxxxxxx X. Xxxxxx
|
|
|
Facsimile:
(000) 000-0000
|
|
|
If
to an Investor:
|
To
the address set forth under such Investor’s name on its signature page to
the Purchase Agreement.
|
Any
party
may change its address for purposes of this paragraph by giving the other
party
written notice of the new address in the manner set forth above.
8.
Indemnification
of Escrow Agent. The Company
hereby indemnifies and holds harmless the Escrow Agent from and against any
and
all loss, liability, cost, damage and expense, including, without limitation,
reasonable counsel fees, which the Escrow Agent may suffer or incur by reason
of
any action, claim or proceeding brought against the Escrow Agent arising
out of
or relating in any way to the Escrow Agreement or any transaction to which
the
Escrow Agreement relates unless such action, claim or proceeding is the result
of the willful misconduct or gross negligence of the Escrow Agent. For this
purpose, the term "attorneys' fees" includes fees payable to any counsel
retained by the Escrow Agent in connection with its services under this
Agreement and, with respect to any matter arising under this Escrow Agreement
as
to which the Escrow Agent performs legal services, if and to the extent that
the
Escrow Agent itself is a law firm, its standard hourly rates and charges
then in
effect. All of the Escrow Agent's rights of indemnification provided for
in this
Escrow Agreement shall survive the resignation of the Escrow Agent, its
replacement by a successor Escrow Agent, its delivery or deposit of the Escrow
Funds in accordance with this Escrow Agreement, the termination of this Escrow
Agreement, and any other event that occurs after this date.
9.
Successors
and Assigns. Except
as
otherwise provided in the Escrow Agreement, no party hereto shall assign
the
Escrow Agreement or any rights or obligations hereunder without the prior
written consent of the other parties hereto, and any such attempted assignment
without such prior written consent shall be void and of no force and effect.
The
Escrow Agreement shall inure to the benefit of and shall be binding upon
the
successors and permitted assigns of the parties hereto.
10. Governing
Law; Jurisdiction. The
Escrow Agreement shall be construed, performed and enforced in accordance
with,
and governed by the internal laws of the State of New York, without giving
effect to the principles of conflicts of laws thereof. Each party agrees
that
all proceedings concerning the interpretations, enforcement and defense of
the
transactions contemplated by this Agreement (whether brought against a party
hereto or its respective Affiliates, employees or agents) shall be commenced
exclusively in the Courts of the State of New York. Each party hereto hereby
irrevocably submits to the exclusive jurisdiction of the Courts of State
of New
York 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 Proceeding, any claim
that
it is not personally subject to the jurisdiction of any Court in the State
of
New York, or that such proceeding has been commenced in an improper or
inconvenient forum. Each party hereto hereby irrevocably waives personal
service
of process and consents to process being served in any such proceeding by
mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for 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. Each party hereto hereby irrevocably waives, to the fullest
extent permitted by applicable law, any and all right to trial by jury in
any
legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
11.
Severability. In
the
event that any part of the Escrow Agreement is declared by any court or other
judicial or administrative body to be null, void, or unenforceable, said
provision shall survive to the extent it is not so declared, and all of the
other provisions of the Escrow Agreement shall remain in full force and
effect.
12.
Amendments; Waivers. The
Escrow Agreement may be amended or modified, and any of the terms, covenants,
representations, warranties or conditions hereof may be waived, only by a
written instrument executed by each of the Company, the Escrow Agent and
Sterne
Agee. Any waiver by any party of any condition or of the breach of any
provision, term, covenant, representation or warranty contained in the Escrow
Agreement, in any one or more instances, shall not be deemed to be nor construed
as further or continuing waiver of any such condition, or of the breach of
any
other provision, term, covenant, representation or warranty of the Escrow
Agreement.
13.
Entire Agreement. The
Escrow Agreement contains the entire understanding among the parties hereto
with
respect to the escrow contemplated hereby and supersedes and replaces all
prior
and contemporaneous agreements and understandings, oral or written, with
regard
to such escrow.
14.
Section Headings. The
section headings in the Escrow Agreement are for reference purposes only
and
shall not affect the meaning or interpretation of the Escrow
Agreement.
15.
Counterparts. The
Escrow Agreement may be executed in counterparts, each of which shall be
deemed
an original, but all of which shall constitute the same instrument.
16.
Resignation. Escrow
Agent may resign upon 30 days advance written notice to the Company. If a
successor escrow agent is not appointed within the 30-day period following
such
notice, Escrow Agent may petition any court of competent jurisdiction to
name a
successor escrow agent or interplead the Escrow Funds with such court, whereupon
Escrow Agent’s duties hereunder shall terminate.
17.
Third-Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto, the Investors
and
their respective successors and permitted assigns and is not for the benefit
of,
nor may any provision hereof be enforced by, any other person or
entity.
[Signature
page follows]
IN
WITNESS WHEREOF,
the
parties hereto have caused the Escrow Agreement to be executed the day and
year
first set forth above.
COMPANY
NEW
PARADIGM PRODUCTIONS, INC.
| By: | /s/Xxxxxxx Xxx | |||
|
Xxxxxxx
Xxx
Its:
Chief Executive Officer
|
ESCROW
AGENT
XXXXXX
XXXX XXXXX RAYSMAN & XXXXXXX LLP
| By: | /s/Xxxxx X. Xxxxxxx, Esq. | |||
|
Name: Xxxxx X. Xxxxxxx, Esq. |
PLACEMENT
AGENT
STERNE
AGEE& XXXXX, INC.
| By: | /s/Xxxx X. Xxxxxxx | |||
|
Xxxx X. Xxxxxxx Its:
Managing Director
|
