CLOSING ESCROW AGREEMENT
EXHIBIT
10.4
This
Closing Escrow Agreement, dated as of June ___, 2007 (this “Agreement”),
is
entered into by and among Deli Solar (USA), Inc., a Nevada corporation, (the
“Company”),
Xxxxxx
Partners, L.P., a Delaware limited partnership, and any other investors named
on
the signature page of this Agreement (together with Investors, the “Investors”
or
the
“Escrowing Parties” and each an “Investor”)
and
Tri-State Title & Escrow, LLC (the “Escrow
Agent”).
The
principal address of each party hereto is set forth on Exhibit A.
WITNESSETH:
WHEREAS,
the Company proposes to make a private offering to the Investors in an aggregate
amount of Two Million Seven Hundred and Fifty Thousand ($2,750,000) Dollars
(the
“Escrowed
Funds”);
and
WHEREAS,
pursuant to a securities purchase agreement to be entered into by the Company
and the Investors for the private placement (the “Securities
Purchase Agreement”),
the
Company and the Investors desire to deposit the Escrowed Funds with the Escrow
Agent, to be held in escrow until joint written instructions are received by
the
Escrow Agent from the Investors, at which time the Escrow Agent will disburse
the Escrowed Funds in accordance with such instructions; and
WHEREAS,
Escrow Agent is willing to hold the Escrowed Funds in escrow subject to the
terms and conditions of this Agreement.
NOW,
THEREFORE, in consideration of the mutual promises herein contained and
intending to be legally bound, the parties hereby agree as follows:
1. Appointment
of Escrow Agent.
The
Investors hereby appoints Escrow Agent as escrow agent in accordance with the
terms and conditions set forth herein and the Escrow Agent hereby accepts such
appointment.
2. Delivery
of the Escrowed Funds.
2.1
The
Investors will direct delivery of the Escrowed Funds to the Escrow Agent’s
account on Closing Date (as defined in the Securities Purchase Agreement) as
follows:
Trust
Account ABA #000000000
Xxxxxxxx
Xxxx
XxXxxx,
XX 00000
Account
#
5060024931
Account
Name: Tri-State Title & Escrow, LLC
The
Escrow Funds are to be held and distributed by the Escrow Agent in accordance
with and subject to the provisions of this Agreement.
3. Escrow
Agent to Hold and Disburse Escrowed Funds.
The
Escrow Agent will hold and disburse the Escrowed Funds received by it pursuant
to the terms of this Escrow Agreement, as follows:
3.1 Upon
receipt of the joint instructions from the Investors, in substantially the
form
of Exhibit B hereto, the Escrow Agent shall release the Escrowed Funds as
directed in such instruction.
3.2 In
the
event this Agreement, the Escrowed Funds or the Escrow Agent becomes the subject
of litigation, or if the Escrow Agent shall desire to do so for any other
reason, each of the Company and the Investors authorizes the Escrow Agent,
at
its option, to deposit the Escrowed Funds with the clerk of the court in which
the litigation is pending, or a court of competent jurisdiction if no litigation
is pending, and thereupon the Escrow Agent shall be fully relieved and
discharged of any further responsibility with regard thereto. Each of the
Company and the Investors also authorizes the Escrow Agent, if it receives
conflicting claims to the Escrow Funds, is threatened with litigation or if
the
Escrow Agent shall desire to do so for any other reason, to interplead all
interested parties in any court of competent jurisdiction and to deposit the
Escrowed Funds with the clerk of that court and thereupon the Escrow Agent
shall
be fully relieved and discharged of any further responsibility hereunder to
the
parties from which they were received.
3.3 In
the
event that the Escrow Agent does not receive any instruction by a date that
is
one month from the date of this Agreement (the “Escrow Termination Date”), all
Escrowed Funds shall be returned to the Investors, with the Accrued Interest
as
defined under Section 7.2.
4. Exculpation
and Indemnification of Escrow Agent
4.1
The
Escrow Agent shall have no duties or responsibilities other than those expressly
set forth herein. The Escrow Agent shall have no duty to enforce any obligation
of any person to make any payment or delivery, or to direct or cause any payment
or delivery to be made, or to enforce any obligation of any person to perform
any other act. The Escrow Agent shall be under no liability to the other parties
hereto or anyone else, by reason of any failure, on the part of any party hereto
or any maker, guarantor, endorser or other signatory of a document or any other
person, to perform such person’s obligations under any such document. Except for
written instructions given to the Escrow Agent by the Escrowing Party relating
to the Escrowed funds, the Escrow Agent shall not be obligated to recognize
any
agreement between or among the Company and the Escrowing Party, notwithstanding
that references hereto may be made herein and whether or not it has knowledge
thereof.
4.2 The
Escrow Agent shall not be liable to the Company and the Investors or to anyone
else for any action taken or omitted by it, or any action suffered by it to
be
taken or omitted, in good faith and acting upon any order, notice, demand,
certificate, opinion or advice of counsel (including counsel chosen by the
Escrow Agent), statement, instrument, report, or other paper or document (not
only as to its due execution and the validity and effectiveness of its
provisions, but also as to the truth and acceptability of any information
therein contained), which
-2-
is
believed by the Escrow Agent to be genuine and to be signed or presented by
the
proper person or persons. The Escrow Agent shall not be bound by any of the
terms thereof, unless evidenced by written notice delivered to the Escrow Agent
signed by the proper party or parties and, if the duties or rights of the Escrow
Agent are affected, unless it shall give its prior written consent
thereto.
4.3 The
Escrow Agent shall not be responsible for the sufficiency or accuracy of the
form, or of the execution, validity, value or genuineness of, any document
or
property received, held or delivered to it hereunder, or of any signature or
endorsement thereon, or for any lack of endorsement thereon, or for any
description therein; nor shall the Escrow Agent be responsible or liable to
the
Company and Investors or to anyone else in any respect on account of the
identity, authority or rights, of the person executing or delivering or
purporting to execute or deliver any document or property or this Escrow
Agreement. The Escrow Agent shall have no responsibility with respect to the
use
or application of the Escrowed Funds pursuant to the provisions
hereof.
4.4 The
Escrow Agent shall have the right to assume, in the absence of written notice
to
the contrary from the proper person or persons, that a fact or an event, by
reason of which an action would or might be taken by the Escrow Agent, does
not
exist or has not occurred, without incurring liability to the Company or to
anyone else for any action taken or omitted to be taken or omitted, in good
faith and in the exercise of its own best judgment, in reliance upon such
assumption.
4.5 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 Funds, or any payment made hereunder, the Escrow Agent may pay such
taxes; and the Escrow Agent may withhold from any payment of the Escrowed Funds
such amount as the Escrow Agent estimates to be sufficient to provide for the
payment of such taxes not yet paid, and may use the sum withheld for that
purpose. The Escrow Agent shall be indemnified and held harmless against any
liability for taxes and for any penalties in respect of taxes, on such
investment income or payments in the manner provided in Section 4.6
4.6 The
Escrow Agent will be indemnified and held harmless by the Company from and
against all expenses, including all counsel fees and disbursements, or loss
suffered by the Escrow Agent in connection with any action, suit or proceedings
involving any claim, or in connection with any claim or demand, which in any
way, directly or indirectly, arises out of or relates to this Escrow Agreement,
the services of the Escrow Agent hereunder, except for claims relating to gross
negligence by Escrow Agent or breach of this Escrow Agreement by the Escrow
Agent, or the monies or other property held by it hereunder. Promptly after
the
receipt by the Escrow Agent of notice of any demand or claim or the commencement
of any action, suit or proceeding, the Escrow Agent shall, if a claim in respect
thereof is to be made against an Escrowing Party, notify each of them thereof
in
writing, but the failure by the Escrow Agent to give such notice shall not
relieve any such party from any liability which an Escrowing Party may have
to
the Escrow Agent hereunder. Notwithstanding any obligation to make payments
and
deliveries hereunder, the Escrow Agent may retain and hold for such time as
it
deems necessary such amount of monies or property as it shall, from time to
time, in its sole discretion,
-3-
seem
sufficient to indemnify itself for any such loss or expense and for any amounts
due it under Section 7.
4.7 For
purposes hereof, the term “expense or loss” shall include all amounts paid or
payable to satisfy any claim, demand or liability, or in settlement of any
claim, demand, action, suit or proceeding settled with the express written
consent of the Escrow Agent, and all costs and expenses, including, but not
limited to, counsel fees and disbursements, paid or incurred in investigating
or
defending against any such claim, demand, action, suit or proceeding.
5. Termination
of Agreement and Resignation of Escrow Agent
5.1 This
Escrow Agreement shall terminate upon (a) disbursement of all of the Escrowed
Funds, and (b) Escrow Termination Date as set forth under Section 3.3, whichever
is earlier, provided that the rights of the Escrow Agent and the obligations
of
the Company under Section 4 shall survive the termination hereof.
5.2 The
Escrow Agent may resign at any time and be discharged from its duties as Escrow
Agent hereunder by giving the Company and the Investors at least five (5)
business days written notice thereof (the “Notice Period”). As soon as
practicable after its resignation, the Escrow Agent shall, if it receives notice
from the Company and the Investors within the Notice Period, turn over to a
successor escrow agent appointed by the Company and the Investors all Escrowed
Funds (less such amount as the Escrow Agent is entitled to retain pursuant
to
Section 7) upon presentation of the document appointing the new escrow agent
and
its acceptance thereof. If no new agent is so appointed within the Notice
Period, the Escrow Agent shall return the Escrowed Funds to the Investors from
which they were received, with the Accrued Interest as defined under Section
7.2.
6. Form
of Payments by Escrow Agent
6.1 Any
payments of the Escrowed Funds by the Escrow Agent pursuant to the terms of
this
Escrow Agreement shall be made by wire transfer unless directed to be made
by
check by the Escrowing Parties.
6.2
All
amounts referred to herein are expressed in United States Dollars and all
payments by the Escrow Agent shall be made in such dollars.
7. Compensation.
Escrow
Agent shall be entitled to the following compensation from the
Company:
7.1 Documentation
Fee:
The
Company shall pay a documentation fee to the Escrow Agent of
$3,000.
7.2 Interest :
The
Escrowed Funds shall accrue interest (the “Accrued Interest”) at the available
rate obtained by the Escrow Agent with respect to the period during which such
funds are held in the Escrow Agent’s account set forth in Section 2.1 above. In
connection with a Closing or a return of funds to the Investors, the Investors
shall be paid Accrued Interest of 2.5%
-4-
per
annum
on the aggregate amount of Escrowed Funds in the Escrow Agent’s account on the
date of such Closing or return of funds and the balance of Accrued Interest,
if
any, shall be retained by the Escrow Agent.
8. Notices.
All
notices, requests, demands, and other communications provided herein shall
be in
writing, shall be delivered by hand or by first-class mail, shall be deemed
given when received and shall be addressed to parties hereto at their respective
addresses first set forth on Exhibit
A
hereto.
9. Further
Assurances. From
time
to time on and after the date hereof, the Company, and Investors shall deliver
or cause to be delivered to the Escrow Agent such further documents and
instruments and shall do and cause to be done such further acts as the Escrow
Agent shall reasonably request (it being understood that the Escrow Agent shall
have no obligation to make any such request) to carry out more effectively
the
provisions and purposes of this Escrow Agreement, to evidence compliance
herewith or to assure itself that it is protected in acting
hereunder.
10. Consent
to Service of Process .
The
Company hereby irrevocably consent to the jurisdiction of the courts of the
State of Virginia and of any Federal court located in such state in connection
with any action, suit or proceedings arising out of or relating to this Escrow
Agreement or any action taken or omitted hereunder, and waives personal service
of any summons, complaint or other process and agrees that the service thereof
may be made by certified or registered mail directed to it at the address listed
on Exhibit A hereto.
11. Miscellaneous
11.1 This
Agreement shall be construed without regard to any presumption or other rule
requiring construction against the party causing such instrument to be drafted.
The terms “hereby,” “hereof,” “hereunder,” and any similar terms, as used in
this Escrow Agreement, refer to the Escrow Agreement in its entirety and not
only to the particular portion of this Escrow Agreement where the term is used.
The word “person” shall mean any natural person, partnership, corporation,
government and any other form of business of legal entity. All words or terms
used in this Escrow Agreement, regardless of the number or gender in which
they
were used, shall be deemed to include any other number and any other gender
as
the context may require. This Escrow Agreement shall not be admissible in
evidence to construe the provisions of any prior agreement.
11.2 This
Agreement and the rights and obligations hereunder of the Company, and the
Investors may not be assigned. This Escrow Agreement and the rights and
obligations hereunder of the Escrow Agent may be assigned by the Escrow Agent,
with the prior consent of the Escrowing Parties. This Escrow Agreement shall
be
binding upon and inure to the benefit of each party’s respective successors,
heirs and permitted assigns. No other person shall acquire or have any rights
under or by virtue of this Escrow Agreement. This Escrow Agreement may not
be
changed orally or modified, amended or supplemented without an express written
agreement executed by the Escrow Agent, the Company and the Escrowing Party.
This Escrow Agreement is intended to be for the sole benefit of the parties
hereto and their respective successors, heirs
-5-
and
permitted assigns, and none of the provisions of this Escrow Agreement are
intended to be, nor shall they be construed to be, for the benefit of any third
person.
11.3 This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of Virginia. The representations and warranties contained
in
this Escrow Agreement shall survive the execution and delivery hereof and any
investigations made by any party. The headings in this Escrow Agreement are
for
purposes of reference only and shall not limit or otherwise affect any of the
terms thereof.
11.4 This
Agreement supersedes the Escrow Agreement entered into by and among the Company,
Xxxxxx Partners L.P. and the Escrow Agent on June 5, 2007.
12. Execution
of Counterparts This
Escrow Agreement may be executed in a number of counterparts, by facsimile,
each
of which shall be deemed to be an original as of those whose signature appears
thereon, and all of which shall together constitute one and the same instrument.
This Escrow Agreement shall become binding when one or more of the counterparts
hereof, individually or taken together, are signed by all the
parties.
-6-
IN
WITNESS WHEREOF, the parties have executed and delivered this Escrow Agreement
on the day and year first above written.
ESCROW
AGENT:
TRI-STATE
TITLE & ESCROW, LLC
By:
/s/
Xxx
Xxxxxx
Name:
Xxx
X. Xxxxxx
Title:
President
XXXXXX
PARTNERS, L.P.
By:
Investors Capital Advisors, LLC, its General Partners
/s/
Xxxxxx Xxxxxx
Name:
Xxxxxx Investors Xxxxxx
Title:
CEO
EOS
HOLDINGS
By:
/s/ Xxx X.Xxxxxx
Xxx
X.Xxxxxx, President
/s/
Xxxxxxx Xxxxxx
Xxxxxxx
Xxxxxx
DELI
SOLAR (USA), INC
By:
/s/ Deli Du
Name:
Deli Du
Title:
President and CEO
-7-
EXHIBIT
A
PARTIES
TO AGREEMENT
Tri-State
Title & Escrow, LLC
000
Xxxx
Xxxxxx
X.X.
Xxx
000
Xxxxxxxxxx,
XX 00000
(000)
000-0000
Attention:
Xxxxxxx X. Xxxxxxx
Telephone:
(000) 000-0000
Fax: (000)
000-0000
Email
xxxxxx@xxxxxxxxxxxxx.xxx
$2,550,000
XXXXXX
PARTNERS LP
Attn:
Xxxxxx Investors Xxxxxx
President
000
Xxxxx
Xxxxxx, 0xx Xxxxx
Xxx
Xxxx
XX 00000
Tel:
000-000-0000
Fax:
000-000-0000
Email:
xxx@Xxxxxxxxxxxxxxxxx.xxx
xxxxx@Xxxxxxxxxxxxxxxxx.xxx
$100,000
Eos
Holdings LLC
Attn:
Xxx
X. Xxxxxx
0000
Xxxxxxxx Xx
Xxx
Xxxxx
XX 00000
Tel:
(000) 000-0000
Fax:
000-000-0000
Email:
xxxxxxx@xxxxxxxx.xxx
$100,000
Xxxxxxx
Xxxxxx
0000
Xxxxxxxx Xxxxx, Xxxxx 0X
Xx
Xxxxx,
Xxxxxxxxxx 00000
Tel:
(000) 000-0000; (000) 000-0000
Fax:
(000) 000-0000
Email:xxxx@xxxxxxxx.xxx
DELI
SOLAR (USA), INC
Building
3 Xx. 00
-0-
Xxxx
Xxx
Xxxxx Xxxx
Xxxxxxx,
Xxxxx 100071
Attn:
Deli Du
Tel:
00000-00000000000 (Chinese)
Tel:
00000-00000000000
(Chinese and English)
Fax:
00000-00000000
Email:
xxxxxxxxxx@xxxxx.xxx
-9-
EXHIBIT
B
DISBURSEMENT
REQUEST
Pursuant
to the Closing Escrow Agreement dated effective as of June __, 2007, among
Xxxxxx Partners, L.P., Eos holdings, LLC and Mr. Xxxxxxx Xxxxxx (
the“Investors”), Deli Solar (USA), Inc. and Tri-State Title & Escrow, LLC.
The Investors, the Escrowing Parties hereby request disbursement of funds in
the
amount and manner described below from account number [ ], styled Tri-State
Title & Escrow, LLC Escrow Account.
Please
disburse
to: _________________________________
Amount
to
disburse:
_________________________________
Form
of
distribution:
_________________________________
Payee:
Name: _________________________________
Address:
_________________________________
City/State:
_________________________________
Zip: _________________________________
Statement
of event or condition which calls for this request for
disbursement:
_______________________________________________________________
_______________________________________________________________
Xxxxxx Partners, L.P.
Date:
_____________
By:
Investors Capital Advisors, LLC, its General Partners
_________________________________
Name:
Xxxxxx Investors Xxxxxx
Title:
CEO
EOS HOLDINGS
By: _____________________________
Xxx
X.Xxxxxx, President
-10-
_________________________________
Xxxxxxx Xxxxxx
-11-
