EXHIBIT 10.111
ESCROW AGREEMENT
THIS ESCROW AGREEMENT is made as of the 21 day of November 2000 among
BounceBack Xxxxxxxxxxxx.xxx, Inc., a Minnesota corporation ("Seller"), On Stage
Entertainment, Inc., a Nevada corporation ("Buyer") and Xxxxxxxx Xxxxxxxx Xxxxx
& Xxxxx, LLP ("Escrow Agent").
RECITALS
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Buyer and Seller are parties to a Letter of Intent, dated as of even date
herewith (the "Letter of Intent"). Pursuant to the Letter of Intent, Buyer
wishes to deposit in escrow with Escrow Agent the Escrowed Property (as defined
below) and Buyer and Seller wish to have the Escrowed Property released by the
Escrow Agent in accordance with the provisions set forth below.
NOW, THEREFORE, the parties hereto, in consideration of the mutual
obligations herein provided, and each intending to be legally bound hereby, do
hereby agree as follows:
I. Receipt and Escrow of Escrowed Property. The Escrow Agent hereby
acknowledges receipt from Seller of One Hundred Thousand and 00/100 Dollars
($100,000), which, together with any interest or income earned thereon, is
defined in this Escrow Agreement as the "Escrowed Property".
II. Disbursement of Escrowed Property.
A. The Escrow Agent shall continue to hold and invest the
Escrowed Property in accordance with Section 3 of this Escrow
Agreement until instructed to disburse the same, in accordance
with the following:
1. At the earlier of the closing of the transactions
contemplated by the Letter of Intent (the "Closing") or 5:00
p.m. EST on January 31, 2001, the Escrowed Property and any
interest earned thereon shall be delivered by Escrow Agent's
check or wire transfer to Seller; provided, however, that in
the event Escrow Agent is notified in writing by Buyer (a)
prior to 5:00 p.m. EST on December 29, 2000 of the
occurrence of one or more of the events set forth in Section
1.2 footnote (1) subparagraph (ii) of the Letter of Intent
or (b) prior to 5:00 p.m. EST on January 31, 2001 of the
occurrence of the event set forth in Section 1.2 footnote
(1) subparagraph (i) of the Letter of Intent, Escrow Agent
shall send to Seller a copy of Buyer's written notice and
Escrow Agent shall only pay the Escrowed Property, together
with any interest earned thereon, to the party entitled
thereto pursuant to the joint written instructions of Seller
and Buyer; or
2. A final, non-appealable order of a court of competent
jurisdiction. The Escrow Agent may require that such court
order be accompanied by a legal opinion by counsel for the
presenting party (which counsel shall be reasonably
acceptable to the Escrow Agent satisfactory to the Escrow
Agent to the effect that the order is final and
non-appealable. The Escrow Agent shall be entitled to act on
such court order and legal opinion (if any) without further
question.
B. In the event of any dispute between Buyer and Seller
concerning the disbursement of the Escrowed Property or if the
entire Escrowed Property shall not have been disbursed within six
(6) months after the date hereof, the Escrow Agent may pay the
entire Escrowed Property into court and shall thereafter have no
further obligation under this agreement.
III. Investment of Escrowed Property.
A. Buyer and Seller hereby instruct Escrow Agent to invest the
Escrowed Property as follows:
1. Escrow Agent shall hold, pursuant to the terms hereof,
the Escrowed Property and shall invest and reinvest, as
directed in writing by the Seller, any money or property
which may at any time form a part of the Escrowed Funds in
securities and obligations of the United States government
or in certificates of deposit or other obligation issued by
banks having a net worth of more than $20 million.
B. Buyer and Seller shall bear sole responsibility for the
investment instructions set forth above. In particular, Escrow
Agent does not guarantee any rate of return on the investments,
nor shall the Escrow Agent have any liability in the event the
Escrowed Property is lost due to the failure (including, but not
limited to, a bankruptcy, receivership or seizure) of any banking
or financial institution into which the Escrowed Property may
have been deposited by the Escrow Agent in accordance with or
pursuant to the investment instructions.
C. If Escrow Agent shall be instructed to deposit the
Escrowed Property in an interest-bearing account, Buyer or
Seller, as the case may be, shall provide Escrow Agent with
a tax identification number. If no tax identification number
shall be provided, Escrow Agent shall deposit the Escrowed
Property in a non-interest bearing account.
IV. Taxes
A. To the extent that the Escrow Agent becomes liable for
the payment of taxes, including withholding taxes, in
respect of income derived from the investment of the
Escrowed Property held hereunder or any payment made
hereunder, the Escrow Agent may pay such taxes from the
Escrowed Property. The Escrow Agent may withhold from any
payment of monies held by it hereunder such amount as the
Escrow Agent estimates to be sufficient to provide the sum
withheld for that purpose.
B. Buyer shall pay or reimburse the Escrow Agent upon
request for any transfer taxes relating to the Escrowed
Property incurred in connection herewith and shall indemnify
and hold harmless the Escrow Agent from any amounts that it
is obligated to pay in the way of transfer taxes.
V. Rights, Duties and Obligations of Escrow Agent.
A. The Escrow Agent shall not be under any duty to give the
Escrowed Property held by it hereunder any greater degree of
care than it gives its own similar property and shall not be
required to invest any funds held hereunder except as
directed in this Escrow Agreement. Un-invested funds held
hereunder shall not earn or accrue interest. The Escrow
Agent shall have a first lien against the Escrowed Funds to
secure the obligations of the parties hereunder.
B. This Escrow Agreement expressly sets forth all the duties
of the Escrow Agent with respect to any and all matters
pertinent hereto. No implied duties or obligations shall be
read into this agreement against the Escrow Agent. The
Escrow Agent shall not be bound by the provisions of any
agreement among the other parties hereto except this Escrow
Agreement.
C. The Escrow Agent shall not be liable, except for its own
gross negligence or willful misconduct and, except with
respect to claims based upon such gross negligence or
willful misconduct that are successfully asserted against
the Escrow Agent, the other parties hereto shall jointly and
severally indemnify and hold harmless the Escrow Agent (and
any successor Escrow Agent) from and against any and all
losses, liabilities, claims, actions, damages, and expenses,
including out of pocket expenses and reasonable attorneys'
fees and disbursements, arising out of and in connection
with the Escrow Agreement, and including, but without
limitation, a suit in interpleader brought by the Escrow
Agent. Without limiting the foregoing, the Escrow Agent
shall in no event be liable in connection with its
investment or reinvestment of any cash held by it hereunder
in good faith, in accordance with the terms hereof,
including without limitation any liability for any delays
(not resulting from its gross negligence or willful
misconduct) in the investment or reinvestment of the
Escrowed Property, or any loss of interest incident to any
such delays.
D. The Escrow Agent shall be entitled to rely upon any
order, judgment, certification, demand, notice, instrument
or other writing delivered to it hereunder without being
required to determine the authenticity or the correctness of
any fact stated therein or the propriety or validity or the
service thereof. The Escrow Agent may act in reliance upon
any instrument or signature believed by it to be genuine and
may assume that any person purporting to give notice or
receipt or advice or make any statement or execute any
document in connection with the provisions hereof has been
duly authorized to do so.
E. The Escrow Agent may act pursuant to the advice of
counsel with respect to any matter relating to this Escrow
Agreement and shall not be liable for any action taken or
omitted in accordance with such advice.
F. The Escrow Agent makes no representation as to the
validity, value, genuineness or the collectibility of any
security or other document or instrument held by or
delivered to it.
G. If, prior to the termination of the escrow created
hereby, the Escrow Agent receives or becomes aware of
conflicting demands or claims with respect to this escrow,
the rights of any of Buyer and Seller hereto, or the
Escrowed Property or any securities, property or documents
deposited with Escrow Agent or affected hereby, the Escrow
Agent shall have the right to discontinue any or all further
acts on its part until such conflict is resolved to Escrow
Agent's satisfaction.
H. The Escrow Agent shall have the further right to commence
or defend any action or proceedings for the determination of
such conflict. In the event the Escrow Agent files a suit in
interpleader, it shall thereupon be fully released and
discharged from all further obligations to perform any and
all duties or obligations imposed upon it by this Escrow
Agreement.
I. The Escrow Agent (and any successor Escrow Agent) may at
any time resign as such by delivering the Escrowed Property
to any successor Escrow Agent jointly designated by the
other parties hereto in writing, or to any court of
competent jurisdiction, whereupon the Escrow Agent shall be
discharged of and from any and all further obligations
arising in connection with this Escrow Agreement. The
resignation of the Escrow Agent will taken effect on the
earlier of (a) the appointment of a successor (including a
court of competent jurisdiction) or (b) the day which is 30
days after the date of delivery of its written notice of
resignation to the other parties hereto. If at that time the
Escrow Agent has not received a designation of a successor
Escrow Agent, the Agent's sole responsibility after that
time shall be to safekeep the Escrowed Property until
receipt of a designation of successor Escrow Agent or a
joint written disposition instruction by Buyer and Seller or
a final order of a court of competent jurisdiction.
J. No printed or other matter in any language (including
without limitation prospectuses, notices, reports and
promotional material) which mentions the Escrow Agent's name
or the rights, power, or duties of the Escrow Agent shall be
issued by the other parties hereto or on such parties'
behalf unless the Escrow Agent shall first have given its
specific written consent thereto.
VI. Miscellaneous.
A. Jurisdiction and Venue. Buyer and Seller hereby
irrevocably submit to the jurisdiction of any court of the
Commonwealth of Pennsylvania or federal court sitting in
Philadelphia, Pennsylvania and any action or proceeding
shall be heard and determined in such a State or federal
court. Buyer and Seller hereby consent to and grant to any
such court jurisdiction over their persons and over the
subject matter of any such dispute and agree that delivery
or mailing of process or other papers in connection with any
such action or proceeding in the manner provided herein
above, or in such other manner as may be permitted by law,
shall be valid and sufficient service thereof.
B. Choice of Law. This Escrow Agreement shall be construed
in accordance with and governed by the internal laws of the
Commonwealth of Pennsylvania (without reference to its rule
as to conflicts of law).
C. Assignment; Successors and Assigns: This Escrow Agreement
shall be binding upon and inure solely to the benefit of the
parties hereto and their respective successors and assigns,
heirs, administrators and representatives and shall not be
enforceable by or inure to the benefit of any third party
except as provided in paragraph I in Article V with respect
to a resignation by the Escrow Agent. No party may assign
any of its rights or obligations under this Escrow Agreement
without the written consent of the other parties.
D. Amendment. This Escrow Agreement may only be modified by
a writing signed by all of the parties hereto, and no waiver
hereunder shall be effective unless in a writing signed by
the party to be charged.
E. Notices. Instructions, notices, releases, payments and
any other documents delivered under this Agreement shall be
sent to the parties hereto as follows:
Buyer:
Xxxxxxx Xxxxxxx, President
On Stage Entertainment, Inc.
0000 Xxxx Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Seller:
Xxxx X. Xxxxxx, President
BounceBack Xxxxxxxxxxxx.xxx, Inc.
000 Xxxxxxxxx Xxxx.
Xxxxx Xxxxxxx, Xxxxxxxxxxx 00000
Escrow Agent:
Xxxxxxxx Xxxxxxxx Xxxxx & Xxxxx, LLP
Suite 3600, 0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attn: Xxxxxx X. Xxxxxx
Notices shall be sent by (i) certified mail or (ii)
overnight courier guaranteeing next day delivery. Any notice
served by certified mail shall be deposited in the United
States Mail with postage thereon fully prepaid. Notice shall
be deemed given upon receipt thereof. Any such notice shall
be addressed to the party at the address set forth above, or
at such other address or addresses as the party may advise
the other parties in writing as required hereunder.
F. Counterparts. This Agreement may be executed in any
number of counterparts. Each such counterpart shall be
deemed to be an original but all such counterparts together
shall constitute one and the same instrument.
G. Conflict. Buyer acknowledges that Escrow Agent is counsel
to Seller and its affiliates and agrees that if any dispute
shall arise between Buyer and Seller and its affiliates with
respect to this Agreement or any other matter, Escrow Agent
and any of its partners or employees may represent Seller
and its affiliates and Buyer shall not raise as an objection
thereto, or seek to disqualify Escrow Agent, its partners or
employees from such representation by reason of, Escrow
Agent's service as escrowee of the Escrowed Property.
[Intentionally Left Blank]
IN WITNESS WHEREOF, the parties intending to be legally bound, have
executed this Agreement as of the date hereof.
BounceBack Xxxxxxxxxxxx.xxx, Inc.
By:
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Xxxx X. Xxxxxx, President
On Stage Entertainment, Inc.
By:
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Xxxxxxx Xxxxxxx, President
Xxxxxxxx Xxxxxxxx Xxxxx & Xxxxx, LLP
By:
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--------------------, Partner
