ESCROW AGREEMENT
Exhibit
10.2
This
Escrow Agreement (this “Agreement”) is made and entered into as of May 28, 2007
by and among Harbin SenRun Forest Development Co., Ltd., a corporation organized
under the laws of the People’s Republic of China (“Harbin SenRun”), Everwin
Development Ltd, a corporation organized under the laws of British Virgin
Islands (“Everwin”), Xxx Xxxx Global Limited, a corporation organized under the
laws of the Hong Kong SAR of the People’s Republic of China (“Hong Kong Xxx
Xxxx”), the Xxx Xxxx Global Limited Trust, a Hong Kong trust created pursuant
to
a Trust and Indemnity Agreement dated March 10, 2007 (the “Xxx Xxxx Global
Limited Trust”) (Everwin, Hong Kong Xxx Xxxx and the Xxx Xxxx Global Limited
Trust being hereinafter referred to as the “SenRun Shareholders”), Patriot
Investment Corporation, a Nevada corporation (the “Company”), Xxxxxxx Xxxxxxxx,
an officer, director and principal shareholder of the Company (“Shepherd”), and
Xxxx X. Xxxxxxxxx, a Utah Professional Corporation (the “Escrow
Agent”).
Recitals
WHEREAS,
the Company, Harbin SenRun, Hong Kong Xxx Xxxx and the Xxx Xxxx Global Limited
Trust entered into a letter of intent agreement dated as of April 25, 2007
(the
“Letter Agreement”), pursuant to which the Company will acquire all the share
capital of Harbin SenRun from the SenRun Shareholders in exchange for 3,000,000
shares of the Company’s common stock pursuant to a share exchange agreement to
be entered into among the parties, and Shepherd and Xxxx Xxx, shareholders
of
the Company (the “Patriot Shareholders”), will sell 44,630,000 restricted shares
of the Company’s common stock (the “Patriot Shares”) to
the SenRun Shareholders in consideration of the payment of Five Hundred Seventy
Five Thousand U.S. Dollars (US $575,000) (the “Purchase Price”);
and
WHEREAS,
Everwin Development Ltd now holds 100% of the issued share capital of Hong
Kong
Xxx Xxxx, will be a signatory to the definitive agreements and will act as
the
agent for the SenRun Shareholders with respect to this Agreement and any
required communications to or from the Escrow Agent.
WHEREAS,
in order to provide the Company with the assurances it requires as a
prerequisite to incurring legal fees and other expenses in connection with
the
proposed transaction, Section 13 of the Letter Agreement provides that Harbin
SenRun and/or the SenRun Shareholders will deliver to the Escrow Agent a
refundable deposit in the amount of U.S. $25,000, which shall be held pursuant
to this Agreement; and
WHEREAS,
this Agreement supersedes and replaces the provisions of the Letter Agreement
with respect to the U.S. $25,000 deposit; and
WHEREAS,
this Agreement sets forth the basis on which the Escrow Agent will receive
and
hold, and make disbursements from, the Escrow Account (as defined below)
and the
duties for which the Escrow Agent will be responsible.
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Agreement
NOW,
THEREFORE, the parties, intending to be legally bound, agree as
follows:
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1)
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Escrow.
The SenRun Shareholders placed into escrow with the Escrow Agent
the
amount of U.S. $25,000 on or about May 7, 2007 (the “Escrow Deposit”),
receipt of which is hereby acknowledged by the Escrow
Agent.
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2)
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Acceptance.
The Escrow Agent hereby accepts delivery of the Escrow Deposit
and agrees
to disburse such in accordance with the terms and procedures set
forth in
this Agreement.
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3)
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Administration
of Escrow Fund.
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Except
as
otherwise provided herein, the Escrow Agent shall administer the Escrow Account
as follows:
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a)
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In
the event the Escrow Agent receives written notice from Everwin
on or
before the close of business on May 31, 2007 that the SenRun Shareholders
do not wish to consummate the transactions contemplated by the
Letter
Agreement because they are not satisfied with the results of their
due
diligence review and investigation of the Company, the Escrow Agent
shall
promptly refund the Escrow Deposit by paying and delivering the
same to
Everwin.
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b)
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In
the event the Escrow Agent does not receive written notice from
Everwin in
the manner and within the time period provided in (a) above, the
Escrow
Agent shall disburse the Escrow Deposit as
follows:
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(i)
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In
the event that Closing of the transactions contemplated by the
Letter
Agreement takes place on or before June 7, 2007, the Escrow Agent
shall
disburse the Escrow Deposit to the Patriot Shareholders at Closing
and the
Escrow Deposit shall be credited against the purchase price payable
for
the Shares by Everwin pursuant to the stock purchase agreement,
or
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(ii)
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In
the event Closing of the transactions contemplated by the Letter
Agreement
has not taken place by the close of business on June 7, 2007 for
any
reason, the Escrow Agent shall disburse the Escrow Deposit to Patriot
as
agreed upon liquidated damages for its costs and expenses incurred
in
connection the proposed transactions and not as a penalty. Notwithstanding
the foregoing, however, if the Escrow Deposit is paid to Patriot
pursuant
to this Section 3(b)(ii), and the Closing occurs subsequent to
June 7,
2006, Patriot shall pay over the Escrow Deposit to the Patriot
Shareholders at the Closing and the Escrow Deposit shall be credited
against the purchase price payable for the Shares by Everwin pursuant
to
the stock purchase agreement.
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4)
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Termination
of Escrow Account.
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a)
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This
Agreement shall terminate effective upon one of the following events:
(i)
the Escrow Agent shall have received the notice from Everwin described
in
Section 3(a) hereof and shall have refunded the Escrow Deposit
to Everwin;
(ii) the Escrow Agent shall have received notice of the Closing
as
described in Section 3(b)(i) hereof and shall have disbursed the
Escrow
Deposit to the Patriot Shareholders; (iii) the Escrow Agent shall
have
received notice from Patriot that Closing has not taken place by
the close
of business on June 7, 2007 as described in Section 3(b)(ii) hereof,
and
shall have disbursed the Escrow Deposit to Patriot; or (iv) the
Escrow
Agent shall have provided written notice to Everwin, the Company
and
Shepherd that the Escrow Agent has resigned as escrow agent under
this
Agreement.
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5)
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Limitation
of Escrow Agent’s Liability.
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a)
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The
Escrow Agent undertakes to perform such duties as are specifically
set
forth in this Agreement only and shall have no duty under any other
agreement or document notwithstanding their being referred to herein.
The
Escrow Agent shall not be liable except for the performance of
such duties
as are specifically set forth in this Agreement, and no implied
covenants
or obligations shall be read into this Agreement against the Escrow
Agent.
The Escrow Agent shall incur no liability with respect to any action
taken
by it or for any inaction on its part in reliance upon any notice,
direction, instruction, consent, statement or other document believed
by
it to be genuine and duly authorized, nor for any other action
or inaction
except for its own willful misconduct or negligence. In all questions
arising under this Agreement, the Escrow Agent may rely on the
advice of
counsel, and for anything done, omitted or suffered in good faith
by the
Escrow Agent based upon such advice the Escrow Agent shall not
be liable
to anyone. The Escrow Agent shall not be required to take any action
hereunder involving any expense unless the payment of such expense
is made
or provided for in a manner reasonably satisfactory to it. In no
event
shall the Escrow Agent be liable for incidental, punitive or consequential
damages.
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b)
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Harbin
SenRun, the SenRun Shareholders, the Company and the Patriot Shareholders
jointly and severally agree to indemnify the Escrow Agent, its
officers,
directors, employees and agents for, and hold it harmless against,
any
loss, liability or expense incurred without negligence or willful
misconduct on the part of Escrow Agent, arising out of or in connection
with its carrying out of its duties hereunder. This right of
indemnification shall survive the termination of this Agreement,
and the
resignation of the Escrow Agent. The costs and expenses of enforcing
this
right of indemnification shall be paid in equal proportion by Harbin
SenRun and the SenRun Shareholders on the one hand and the Company
and the
Patriot Shareholders on the other
hand.
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6)
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Notices.
Any notice or other communication required or permitted to be delivered
to
any party under this Agreement shall be in writing and shall be
deemed
properly delivered, given and received when delivered personally
or by
commercial mail (return receipt requested) or sent via facsimile
(with
confirmation of receipt) to the address or facsimile telephone
number set
forth below (or to such other address or facsimile telephone number
as
such party shall have specified in a written notice given to the
other
parties hereto):
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a)
To Escrow Agent:
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Xxxx
X.
Xxxxxxxxx, A Professional Corporation
0000
Xxxxx 000 Xxxx, Xxxxx 0-X
Xxxx
Xxxx
Xxxx, Xxxx 00000
Attention:
Xxxx X. Xxxxxxxxx, Esq.
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
b) To
Harbin
SenRun or the Harbin SenRun Shareholders:
C/O
Xxxxxx X. Xxxxxx, Esq.
Counsel
to Harbin SenRun and the SenRun Shareholders
00000
Xxxxxx Xxxxx, Xxxxx 000X
Xxxxxxxxx,
XX 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
c) To
the
Company and Shepherd on Behalf of the Patriot Shareholders:
Patriot
Investment Corporation
0000
Xxxxxxxxx Xxxxx
Xxxx
Xxxx
Xxxx, Xxxx 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
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If
Notice
is delivered or transmitted by telecopier during the normal business hours
of
the recipient, it will be deemed to be received when delivered or sent by
telecopier. If a Notice is delivered or transmitted by telecopier outside
of
normal business hours of the recipient, it will be deemed to be received
at the
commencement of normal business hours of the recipient on the next business
day.
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7)
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Miscellaneous.
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a)
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Headings.
The underlined headings contained in this Agreement are for convenience
of
reference only, shall not be deemed to be a part of this Agreement
and
shall not be referred to in connection with the construction or
interpretation of this Agreement.
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b)
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Counterparts.
This Agreement may be executed by facsimile in
several counterparts, including counterparts by facsimile, each
of which
shall constitute an original and all of which, when taken together,
shall
constitute one agreement.
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c)
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Governing
Law and Venue. This Agreement shall be construed in
accordance with, and governed in all respects by, the internal
laws of the
State of Utah (without giving effect to principles of conflicts
of laws),
and the parties agree that any action relating to this Agreement
shall be
instituted and prosecuted in the court of the County of Salt Lake,
State
of Utah, and each party waives the right to change of
venue.
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d)
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Successors
and Assigns. This Agreement shall be binding upon each of the parties
hereto and each of their respective permitted successors and assigns,
if
any. Nothing in this Agreement is intended to confer, or shall
be deemed
to confer, any rights or remedies upon any person or entity other
than the
parties hereto and their permitted successors and
assigns.
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e)
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Waiver.
No failure on the part of any Person to exercise any power, right,
privilege or remedy under this Agreement, and no delay on the part
of any
Person in exercising any power, right, privilege or remedy under
this
Agreement, shall operate as a waiver of such power, right, privilege
or
remedy; and no single or partial exercise of any such power, right,
privilege or remedy shall preclude any other or further exercise
thereof
or of any other power, right, privilege or remedy. No person
shall be deemed to have waived any claim arising out of this Agreement,
or
any power, right, privilege or remedy under this Agreement, unless
the
waiver of such claim, power, right, privilege or remedy is expressly
set
forth in a written instrument duly executed and delivered on behalf
of
such person; and any such waiver shall not be applicable or have
any
effect except in the specific instance in which it is
given.
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f)
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Amendments. This
Agreement may not be amended, modified, altered or supplemented
other than
by means of a written instrument duly executed and delivered by
all the
parties hereto.
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g)
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Severability. In
the event that any provision of this Agreement, or the application
of any
such provision to any Person or set of circumstances, shall be
determined
to be invalid, unlawful, void or unenforceable to any extent, the
remainder of this Agreement, and the application of such provision
to
Persons or circumstances other than those as to which it is determined
to
be invalid, unlawful, void or unenforceable, shall not be impaired
or
otherwise affected and shall continue to be valid and enforceable
to the
fullest extent permitted by law.
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h)
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Entire
Agreement. This Agreement and the other agreements referred to herein
set forth the entire understanding of the parties hereto relating
to the
subject matter hereof and thereof and supersede all prior agreements
and
understandings among or between any of the parties relating to
the subject
matter hereof and thereof.
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i)
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Waiver
of Jury Trial. Each of the parties hereto hereby
irrevocably waives any and all right to trial by jury in any legal
proceeding arising out of or related to this Agreement or the transactions
contemplated hereby.
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j)
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Escrow
Agent is Counsel to Company and Patriot Shareholders. The parties
hereto acknowledge and agree that the Escrow Agent is acting as
legal
counsel to the Company and the Patriot Shareholders in connection
with the
transactions contemplated by the Letter Agreement and may not be
considered to be an independent escrow
agent.
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k)
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Construction.
For purposes of this Agreement, whenever the context requires:
the
singular number shall include the plural, and vice versa; the masculine
gender shall include the feminine and neuter genders; the feminine
gender
shall include the masculine and neuter genders; and the neuter
gender
shall include the masculine and feminine genders. The parties hereto
agree
that any rule of construction to the effect that ambiguities are
to be
resolved against the drafting party shall not be applied in the
construction or interpretation of this Agreement. As used in this
Agreement, the words “include” and “including,” and variations thereof,
shall not be deemed to be terms of limitation, but rather shall
be deemed
to be followed by the words “without
limitation.”
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[The
balance of this page is left blank intentionally]
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In
Witness Whereof, the parties have duly executed this Escrow Agreement as
of the
date first above written.
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Harbin
SenRun:
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HARBIN
SENRUN FOREST DEVELOPMENT CO., LTD.
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By:
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/s/
Zhang, Chunman
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Name:
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Zhang,
Chunman
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Title:
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Chief
Executive Officer
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The
SenRun Shareholders:
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“Everwin”
EVERWIN
DEVELOPMENT LIMITED
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By:
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/s/
Ha, Man
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Name:
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Ha,
Man
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Title:
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Director
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“Hong
Kong Xxx Xxxx”
XXX
XXXX GLOBAL LIMITED
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By:
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/s/
Ha, Man
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Name:
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Ha,
Man
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Title:
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Director
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“Xxx
Xxxx Global Limited Trust”
XXX
XXXX GLOBAL LIMITED TRUST
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By:
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/s/ Han,
Degong
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Name:
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Han,
Degong
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Title:
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Trustee
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The
Company:
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PATRIOT
INVESTMENT CORPORATION
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By:
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/s/
Xxxxxxx Xxxxxxxx
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Name:
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Xxxxxxx
Xxxxxxxx
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Title:
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President
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Shepherd:
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/s/
Xxxxxxx Xxxxxxxx
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Xxxxxxx
Xxxxxxxx
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Escrow
Agent:
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Xxxx
X. Xxxxxxxxx, A Professional Corporation
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By:
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/s/
Xxxx X. Xxxxxxxxx
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Xxxx
X. Xxxxxxxxx, President
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