Exhibit 10.4
NOTE AND STOCK ESCROW AGREEMENT
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This Note and Stock Escrow Agreement ("Agreement") dated as
of January 12, 2001 by and among Centrack International, Inc., a
Delaware corporation (the "Corporation"), Xxxxxx Xxxxxxxxx, in his
individual capacity (the "Buyer"), and the Corporation's designated (to
be named not later than the date hereof), as Note and Stock Escrow Agent
(the "Note and Stock Escrow Agent").
WITNESSETH:
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The Buyer and the Corporation have entered into that certain
Stock Subscription and Stock Purchase Agreement dated as of
January 12, 2001 (the "Stock Subscription and Purchase Agreement"), the
terms of which are incorporated herein by reference and made a part
hereof, which terms provide, among other things, for the issuance by the
Corporation of 51,780,178 shares of restricted common stock in
Centrack International, Inc. (the "Shares") in three certificates for
approximately equal numbers of Shares, and the execution, delivery and
payment (subject to certain conditions) by the Buyer of two promissory
notes, each in the amount of $50,000.00. In fulfillment of the
provisions of the Stock Subscription and Purchase Agreement, the Buyer,
the Corporation and the Note and Stock Escrow Agent are now entering
into this Agreement.
Accordingly, in consideration of the mutual promises
contained herein, the parties, intending to be legally bound hereby,
agree as follows:
1. Deliveries to the Note and Stock Escrow Agent.
(a) The Buyer hereby deposits with the Note and Stock
Escrow Agent, an original of each of Promissory Note No. 1 and
Promissory Note No. 2, as described in, and required by, the Stock
Subscription and Purchase Agreement, both notes being duly executed by
the Buyer (the "Note Escrow Deposit"). By execution of this Agreement,
the Note and Stock Escrow Agent acknowledges receipt of the Note Escrow
Deposit.
(b) The Corporation hereby deposits with the Note and
Stock Escrow Agent the Shares, as represented by Certificates Nos.
____, ___, and ___, the Shares being issued to the Buyer or his
assigns named in writing delivered to the Corporation prior to the
Closing, as defined in the Stock Subscription and Purchase Agreement,
and bearing a restrictive legend in the form indicated in Section 2 of
the Stock Subscription and Purchase Agreement and on the face of each
certificate, indicating that such shares of stock have not been
registered with the United States Securities and Exchange Commission
or any other securities agency and may not be transferred by the Buyer
(or his assigns, as the case may be) without registration or
acceptable written opinion of the Buyer's counsel that an exemption
from such registration is available.
2. Note and Stock Escrow. The Note and Stock Escrow Agent
is hereby directed to hold the Shares and the certificates representing
the Shares, and the two promissory notes referred to herein, in a bank
safety deposit box obtained by the Note and Stock Escrow agent for this
purpose at the ____________________bank, located at ___________________.
Exhibit 10.4 - Pg. 1
3. Disbursement of Note and Stock Escrow.
a. Disbursements to the Buyer. Note and Stock
releases from the Note and Stock Escrow shall be made as follows. (i)
Upon receipt by the Cash Escrow Agent of the Initial Cash Escrow
Deposit (as defined in the Cash Escrow Agreement), the Cash Escrow
Agent shall provide the Note and Stock Escrow Agent with satisfactory
documentation of receipt of such deposit and the amount thereof.
Thereupon, the Note and Escrow Agent shall release to the Buyer the
first certificate for approximately one third of the Shares. Upon
receipt by the Cash Escrow Agent of the $50,000 payment of Promissory
Note No. 1, the Cash Escrow Agent shall provide the Note and Stock
Escrow Agent with satisfactory documentation of receipt of such
payment and the amount thereof. Thereupon, the Note and Escrow Agent
shall release to the Buyer the second certificate for approximately
one third of the Shares. Upon the sooner to occur of (i) payment in
full to the Cash Escrow Agent of Promissory Note No. 2 or (ii)
completion of a reverse merger involving the Corporation and payment
by the Buyer to the Cash Escrow Agent (through payments on Promissory
Note No. 2, which shall be made by the Buyer in response to demands
for payment required to be made by the Cash Escrow Agent) of
sufficient funds to pay all of the obligations of the Corporation
incurred between the date of the Closing (as defined in the Stock
Subscription and Purchase Agreement) and the date of completion of the
reverse merger, the third and final certificate for the remaining
approximately one third of the Shares shall be released to the Buyer.
As each of the notes is paid in full by the Buyer (or, in the case of
Promissory Note No. 2, cancelled, as the case may be), the original of
such note shall be given by the Note and Stock Escrow Agent to the
Corporation, which shall cause such original to be marked "CANCELLED"
or "PAID IN FULL" (as the case may be) and delivered to the Buyer.
b. Disbursements to the Corporation. If the Buyer
fails to pay Promissory Note No. 1 in full at the agreed time, the Note
and Escrow Agent shall return to the Corporation for cancellation the
remaining two certificates representing approximately two thirds of the
Shares, and the Buyer shall have no further rights with respect to such
Shares. If the Buyer fails to make any payments properly demanded on
Promissory Note No. 2 or otherwise fails to make such payments under
that note so as to provide sufficient funds to pay all of the
Corporation's obligations incurred between the date of Closing (as
defined in the Stock Subscription and Purchase Agreement and the
completion of a reverse merger involving the Corporation (or the date on
which expenditure of the entire amount of the proceeds of Promissory
Note No. 2 on such obligations (other than those paid with the proceeds
from the Initial Cash Escrow Deposit and Promissory Note No. 1) has
occurred, the Note and Escrow Agent shall return to the Corporation for
cancellation the remaining two certificate representing the final
approximately one third of the Shares, and the Buyer shall have no
further rights with respect to such Shares.
4. Regarding the Note and Stock Escrow Agent.
a. The Corporation and the Buyer, jointly and
severally, agree to hold the Note and Stock Escrow Agent harmless and to
indemnify the Note and Stock Escrow Agent against any loss, liability,
expenses (including attorney's fees and expenses), claim or demand
arising out of or in connection with the performance of its obligations
in accordance with the provisions of this Agreement, including without
limitation, to the fullest extent allowed by applicable law, any such
loss, liability, expenses, claim or demand arising under any securities
laws or regulations, except for the negligence, willful misconduct or
failure of the Note and Stock Escrow Agent to perform its obligations.
The foregoing indemnities in this paragraph shall survive the
resignation of the Note and Stock Escrow Agent or the termination of
this Agreement.
b. The Note and Stock Escrow Agent's duties are only
such as are specifically provided herein, and the Note and Stock Escrow
Agent shall incur no liability whatsoever to the Corporation or the
Buyer, except for its negligence, willful misconduct or failure to
perform its obligations hereunder. The Note and Stock Escrow Agent
Exhibit 10.4 - Pg. 2
shall have no responsibility hereunder other than to follow faithfully
the instructions herein contained, and the Note and Stock Escrow Agent
shall have no duty or obligation to determine which party may at any
time be entitled to the monies on deposit in the Escrow Account. Except
as set forth in this Paragraph 4.b, the Note and Stock Escrow Agent
shall not be liable while acting in accordance with any written
instructions given to it hereunder and believed by it to have been
executed by the proper parties.
c. It is understood and agreed that should any
dispute arise with respect to the payment and/or ownership or right of
possession of any portion of the Note and Stock Escrow Account, the Note
and Stock Escrow Agent is authorized and directed to retain in its
possession, without liability to anyone, all or any part of Note and
Stock Escrow Deposits until such dispute shall have been settled either
by mutual agreement by the parties concerned or by the final order,
decree or judgment of a court or other tribunal of competent
jurisdiction in the United States of America and time for appeal has
expired and no appeal has been perfected, but the Note and Stock Escrow
Agent shall be under no duty whatsoever to institute or defend any such
proceedings. except in case of its negligence, willful misconduct or its
breaching this Agreement.
d. The Note and Stock Escrow Agent may resign at any
time by giving written notice thereof to the other parties hereto, but
such resignation shall not become effective until a successor Note and
Stock Escrow Agent shall have been appointed with the consent of all
parties hereto and shall have accepted such appointment in writing. If
an instrument of acceptance by a successor Note and Stock Escrow Agent
shall have not have been delivered to the Note and Stock Escrow Agent
within thirty (30) days after the giving of such notice of resignation,
the resigning Note and Stock Escrow Agent may petition any court of
competent jurisdiction for the appointment of a successor Note and Stock
Escrow Agent.
5. Notices. All notices, demands, requests and other
communications required or permitted to be given under the provisions of
this Agreement shall be in writing and shall be deemed duly given on the
date mailed by certified United States delivered (by messenger or
overnight or express delivery service), addressed to the Corporation and
the Buyer as set forth in the Stock Subscription and Purchase Agreement
(the Corporation being referred to therein as the "Seller"). All
notices and demands, given to the Note and Stock Escrow Agent under the
provisions of this Agreement shall be in writing and shall be addressed
to _____________________________.
Exhibit 10.4 - Pg. 3
6. The Parties agree to indemnify the accounting firm of
Xxxxxx & Xxxxxx, Xxxxxxx X. Xxxxxx individually, against any claims
brought against any of them pertaining to this Agreement, except to
the extent such claims are based upon the negligence, willful
misconduct or violation of law by Xxxxxx & Xxxxxx, Xxxxxxx X. Xxxxxx
individually.
7. General. This Agreement shall be construed in
accordance with the laws of the State of Florida, without giving effect
to the conflicts of laws rules thereof. Each of the Parties submits
unconditionally to the jurisdiction of the Federal Court for the
Southern District of Florida for resolution of any controversy
hereunder. This Agreement may be executed in several counterparts, each
of which shall constitute an original, and all collectively shall
constitute but one agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement as of the date first above written.
ATTEST: /s/ Xxxxxx X. Xxxxxxx, as agent
for a corporation to be formed
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(Note and Stock Escrow Agent)
____Michael A. Caruso________ By:____ Xxxxxx X. Stewart______
Name:_______________________
Title:______________________
ATTEST: CENTRACK INTERNATIONAL, INC.
____Michael A. Caruso_______ By:_____/s/ Xxxx X. Lofquist___
Name: Xxxx X. Xxxxxxxx
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Title: Chairman & President
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_____/s/ Xxxxxx Xxxxxxxxx ______
Xxxxxx Xxxxxxxxx
Exhibit 10.4 - Pg. 4
