EXHIBIT 10.1
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ESCROW AGREEMENT
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This is an Escrow Agreement dated as of March 30, 2009, among
PSQ, LLC, a Kentucky limited liability company ("PSQ"), General
Employment Enterprises, Inc., an Illinois corporation ("GEE") (PSQ and
GEE being the "Parties") and The Park Avenue Bank (the "Escrow Agent")
(the Parties and the Escrow Agent being collectively the "parties").
RECITALS
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Whereas, GEE and PSQ have entered into a Securities Purchase and
Tender Offer Agreement dated the date hereof (the "Purchase
Agreement") pursuant to which, among other things, PSQ has agreed to
purchase 7,700,000 shares of GEE common stock for $1,925,000 (the
"Shares" and "Purchase Price," respectively); and
Whereas, PSQ and GEE have agreed that PSQ will deposit the
Purchase Price into escrow with the Escrow Agent upon execution of the
Purchase Agreement to (i) secure (a) payment of the Purchase Price to
GEE upon consummation of the purchase and sale of the Shares
contemplated by the Purchase Agreement, or (b) payment of a
termination fee and reimbursement of expenses to GEE if the Purchase
Agreement is terminated under certain circumstances, or (ii) be
returned to PSQ if the Purchase Agreement is terminated under
circumstances not requiring payment of such termination fee and
reimbursement of such expenses to GEE, as more fully set forth in the
Purchase Agreement.
Now, therefore, the parties agree as follows:
AGREEMENTS
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1. AGENCY. The Escrow Agent shall act as escrow agent for GEE
and PSQ in accordance with the terms and conditions of this Agreement.
2. DEPOSIT. PSQ has deposited the Purchase Price with Escrow
Agent, and the Escrow Agent hereby acknowledges the receipt from PSQ
of the Purchase Price and agrees that the Purchase Price is to be held
in escrow by the Escrow Agent on the terms hereinafter set forth. The
Parties hereby direct the Escrow Agent to deposit the Purchase Price
in the following negotiable securities which qualify for immediate
withdrawal of the Purchase Price ("Permitted Investments"): debt
securities issued or guaranteed by the United States Government, FDIC
fully-insured Non-Interest Bearing Transaction Account with a bank,
such as and including the Park Avenue Bank of 000 Xxxx Xxxxxx, Xxx
Xxxx, XX 00000, with total resources (assets) of at least
$500,000,000, prime commercial paper, or such other debt securities
agreed to by the Parties. The collective amount of the Purchase Price
and the Escrow Earnings (as defined below) is referred to herein as
the "Escrow Fund", and the funds included in the Escrow Fund are
referred to herein as the "Escrowed Funds".
3. EARNINGS ON ESCROW FUND. Earnings on Permitted Investments
(including, without limitation, any interest accrued thereon and any
other profit realized therefrom) shall be credited, and any loss
resulting from Permitted Investments shall be charged to, the Escrow
Fund (the actual amount of such earnings (and interest or other
profit) and losses from time to time is referred to herein as the
"Escrow Earnings"). The Escrow Earnings shall include the earnings
earned with respect to (a) the Escrow Fund and (b) the Escrow Earnings
previously earned with respect to such Escrow Fund, and shall become a
part of, and shall be included in, the Escrow Fund.
4. RELEASE OF ESCROWED FUNDS.
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4.1 The Escrow Agent shall hold the Escrowed Funds in its
possession in an escrow account in the name of the Escrow Agent until
authorized or required to deliver all or any portion of such Escrowed
Funds as follows:
(a) Upon receipt of a certificate requesting the
delivery of Escrowed Funds signed by GEE and PSQ (a "Joint
Certificate"), the Escrow Agent shall deliver all or a portion of the
Escrowed Funds to GEE and/or PSQ as directed in such certificate, to
the extent there are Escrowed Funds remaining in the Escrow Fund; or
(b) Upon receipt of a final, non-appealable award or
order of a court of competent jurisdiction forwarded by GEE or PSQ and
certified in writing by the party making such delivery as genuine and
binding upon the parties with respect to payment of all or any portion
of the Escrow Fund ("Judgment"), the Escrow Agent shall deliver the
amount of the Escrowed Funds contained in such award or order to GEE
and/or PSQ, to the extent there are remaining Escrowed Funds, as
directed in such award or order.
4.2 If the Closing (as defined in the Purchase Agreement)
occurs, GEE and PSQ agree to deliver to the Escrow Agent no later than
the Closing Date (as defined in the Purchase Agreement) a Joint
Certificate directing the Escrow Agent to distribute to GEE out of the
Escrowed Funds an amount equal to the Purchase Price by wire transfer
of immediately available funds on the Closing Date to an account
specified by GEE.
4.3 If the Purchase Agreement is terminated under
circumstances in which PSQ is required to pay a termination fee and
reimburse expenses to GEE as specified in Section 6.2(b) of the
Purchase Agreement, GEE and PSQ agree to deliver to the Escrow Agent
no later than three days after the termination of the Purchase
Agreement a Joint Certificate directing the Escrow Agent to distribute
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(a) first, to GEE out of the Escrow Fund, within two days after the
Escrow Agent's receipt of such Joint Certificate, an amount equal to
the termination fee and the expense reimbursement amounts specified in
Section 6.2(b) of the Purchase Agreement, which distribution shall be
made to GEE by wire transfer of immediately available funds to an
account specified by GEE, and (b) second, to PSQ, the remaining
Escrowed Funds (if any), within two days after the Escrow Agent's
receipt of such Joint Certificate, which distribution shall be made to
PSQ by wire transfer of immediately available funds to an account
specified by PSQ.
4.4 If the Purchase Agreement is terminated under
circumstances in which PSQ is not required to pay a termination fee or
reimburse expenses to GEE as specified in Section 6.2(b) of the
Purchase Agreement, GEE and PSQ agree to deliver to the Escrow Agent
no later than three days after the termination of the Purchase
Agreement a Joint Certificate directing the Escrow Agent to distribute
to PSQ the Escrowed Funds within two days after the Escrow Agent's
receipt of such Joint Certificate, which distribution shall be made to
PSQ by wire transfer of immediately available funds to an account
specified by PSQ.
5. TAXES AND CHARGES ON ESCROW FUND. PSQ shall be responsible
for and shall pay and discharge all taxes, assessments and
governmental charges imposed on or with respect to the Escrow Fund.
If requested by the Escrow Agent, PSQ agrees to provide the Escrow
Agent with a certified tax identification number by signing and
returning a Form W-9, regardless of whether or not PSQ is exempt from
reporting or withholding requirements under the Internal Revenue Code
of 1986.
6. TERMINATION. Escrow Agent's services hereunder shall
terminate upon the disbursement of all of the Escrowed Funds from the
Escrow Fund in accordance with paragraph 4 above.
7. FEE. Escrow Agent shall receive a fee of $500.00 for its
services hereunder, along with reimbursement for out-of-pocket
expenses incurred in connection with such services and this Agreement.
PSQ shall be responsible for all of the Escrow Agent's fees and
expenses.
8. PROVISIONS CONCERNING THE ESCROW AGENT.
8.1 Escrow Agent may resign and be discharged from its
duties hereunder at any time by giving notice of such resignation to
the Parties specifying a date when such resignation shall take effect.
The Parties may remove the Escrow Agent as escrow agent by giving
joint notice of such removal to the Escrow Agent and specifying a date
when such removal shall take effect. Upon such notice, the Parties
shall jointly appoint a successor escrow agent, such successor escrow
agent to become escrow agent hereunder upon the resignation or removal
date specified in the appropriate notice. Escrow Agent shall continue
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to serve until its successor accepts its appointment as successor
Escrow Agent and receives the Escrowed Funds.
8.2 Escrow Agent undertakes to perform such duties as are
specifically set forth herein and may conclusively rely, and shall be
protected in acting or refraining from acting, on any written notice,
instrument, or signature believed by it to be genuine and to have been
signed or presented by the proper party or parties duly authorized to
do so.
8.3 The Escrow Agent shall not be liable for any action
taken or omitted to be taken by it in good faith and believed by it to
be authorized hereby or within the rights or powers conferred upon it
hereunder, nor for any action taken or omitted to be taken by it in
good faith, and in accordance with the advice of counsel (which
counsel may be of Escrow Agent's own choosing), and shall not be
liable for any mistake of fact or error of judgment or for any acts or
omissions of any kind unless caused by willful misconduct or gross
negligence.
8.4 The Parties agree to indemnify the Escrow Agent and
hold it harmless against any and all liabilities incurred by it
hereunder, except in the case where such liabilities result from its
own willful misconduct or gross negligence.
9. MISCELLANEOUS.
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9.1 This Agreement and the legal relations among the
parties shall be governed by and construed in accordance with the laws
of the state of New York, without regard to conflicts of laws
principles.
9.2 All notices and other communications shall be in
writing, shall be given either by telecopy to the numbers set forth
after the parties name or such other telecopy number as shall be given
to such party.
9.3 This Agreement may be amended, supplemented or
modified, and any provision hereof may be waived, only pursuant to a
written instrument making specific reference to this Agreement signed
by each of the parties hereto.
9.4 This Agreement and the Purchase Agreement constitute
the entire agreement among the parties pertaining to the subject
matter contained herein.
IN WITNESS WHEREOF, the parties have duly executed and delivered
this Agreement as of the date first above written.
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XXX XXXX XXXXXX XXXX
XXXXXX AGENT:
By: /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Title: SVP
Fax# 000-000-0000
GENERAL EMPLOYMENT ENTERPRISES, INC.
By: /s/ Xxxx X. Xxxxx
Title: Vice President, Chief Financial Officer and Treasurer
Fax# 000-000-0000
PSQ, LLC
By: /s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx, sole member
Fax# 000-000-0000
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