AMENDMENT TO ESCROW AND CONTRIBUTION AGREEMENT
Reference is made to that certain Escrow and Contribution Agreement dated
effective as of November 12, 2003 (the "ESCROW AND CONTRIBUTION AGREEMENT"), by
and among RAPIDTRON, INC., a Nevada corporation ("RAPIDTRON"); XXXXX XXXXXXX, an
individual and Secretary, Treasurer, General Manager, Director and shareholder
of Rapidtron ("MEINEKE"); XXXXX XXXXXXX, an individual and Executive Vice
President and shareholder of Rapidtron ("DERMUTZ"); XXXX XXXXX, an individual
and President, Chairman of the Board of Directors and shareholder of Rapidtron
and the shareholder representative of the Principals ("SHAREHOLDER
REPRESENTATIVE"); Ceres Financial Limited, a BVI company ("LEAD INVESTOR"); and
XXX & XXXXXXX, LLP, a California limited liability partnership ("XXX XXXXXXX").
This AMENDMENT TO ESCROW AND CONTRIBUTION AGREEMENT ("AGREEMENT") is made and
entered into by and among the Shareholder Representative on behalf of the
Principals, the Lead Investor on behalf of the Investors, Rapidtron and
XXXXXXXXX XXXXXXX, LLP, as the new escrow agent (the "XXXXXXXXX"), effective on
the 31st day of March, 2005 (the "EFFECTIVE DATE"), and amends the Escrow and
Contribution Agreement.
Collectively, Xxxxx, Meineke and Dermutz are referred to in this Agreement as
the "PRINCIPALS." Rapidtron, the Principals, the Lead Investor and Xxxxxxxxx
are sometimes hereinafter referred to collectively as the "PARTIES."
Capitalized terms not otherwise defined herein shall have the meanings set forth
in the Escrow and Contribution Agreement.
RECITALS
WHEREAS, the Parties entered into the Escrow and Contribution Agreement,
pursuant to which the Principals made certain representations and warranties in
the Purchase Agreement to the Investors related to financial forecasts of
Rapidtron contained in Section 4.1 (ii) related to gross revenues for the
fifteen month period beginning October 1, 2003 and ending December 31, 2004;
WHEREAS, Rapidtron filed its Form 10-KSB for the year ended December 31,
2004, and Xxx Xxxxxxx effectively resigned as escrow agent subsequent to such
filing;
WHEREAS, the Parties agreed to amend the Escrow and Contribution Agreement
to appoint Xxxxxxxxx as Escrow Agent to replace Xxx Xxxxxxx and to extend the
period for providing notice and claims under the Escrow and Contribution
Agreement; however, the amendment was not executed by the Parties and the Escrow
Property was not delivered to Xxxxxxxxx;
WHEREAS, the Parties have determined that it is necessary to amend the
Escrow and Contribution Agreement to appoint Xxxxxxxxx as Escrow Agent and to
extend the period for providing notice and claims under the Escrow and
Contribution Agreement;
NOW, THEREFORE, in consideration of the premises and of the covenants and
agreements set forth herein, and intending to be legally bound hereby, the
Parties agree as follows:
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1. Amendment.
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1.1 The Parties acknowledge and agree that Xxxxxxxxx shall be appointed as
Escrow Agent to replace Xxx Xxxxxxx;
1.2 The Parties acknowledge and agree that Xxxxxxxxx and the other Parties
require sufficient time to locate the Escrow Property and to properly
re-establish the Escrow;
1.3 The Parties agree that Section 4(b) of the Escrow and Contribution
Agreement shall be amended to provide as follows:
(b) The Lead Investor shall, by giving written notice to the
Principal Representative, Rapidtron and the Escrow Agent (a "CLAIM
NOTICE"), make a claim against the Escrow Property for (i) any amounts
claimed under Section 1(a)(iii)(A) of this Agreement, no later than
December 31, 2005 or (ii) any amounts claimed under Section
1(a)(iii)(B) at any time prior to the Escrow Termination Date set
forth in Section 4(g) (each such claim a "CONTRIBUTION CLAIM"). Such
Claim Notice shall contain such facts and information as are then
reasonably available and the specific basis for the Contribution
Claim. In the event that the Lead Investor fails to give a Claim
Notice to the Principal Representative, Rapidtron and the Escrow Agent
on or before December 31, 2005, the Escrow Agent shall promptly
transfer the Escrow Property to the Principals in accordance with
Section 4(d).
1.4 The Parties agree that Section 4(g) of the Escrow and Contribution
Agreement shall be amended to provide as follows:
(g) On December 31, 2005 or such other day as the Parties may agree
(the "ESCROW TERMINATION DATE"), the remaining Escrow Property, if
any, shall be transferred to the Principals in accordance with their
respective interests if (i) all Escrow Property has not previously
been transferred to Rapidtron in accordance with any of Section 4(b),
(c), (d) or (e) hereof or (ii) no Claim Notice has been given by the
Lead Investor in accordance with Section 4(b) hereof; provided
however, that if the Lead Investor has made any claim against the
Escrow Property to which the Principal Representative has timely
objected and which remains outstanding as of the Escrow Termination
Date, then no Escrow Property shall be transferred to the Principals
until such time as any such claim has been resolved in accordance with
the provisions of Section 4(d); provided, however, that if the amount
of the claim is not disputed by the Lead Investor, and if such amount
is less than the balance then remaining of the Escrow Property, then
the balance of the Escrow Property not subject to such claim shall be
transferred as provided in the first sentence of this Section 4(g).
* * *
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IN WITNESS WHEREOF, this Amendment to the Escrow and Contribution Agreement
has been executed by the parties as of the date first above written.
RAPIDTRON, INC. PRINCIPALS:
Xxxx Xxxxx, as Shareholder Representative
By:
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Name:
Title: President
By:
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Name: Xxxx Xxxxx
Address:
ESCROW AGENT: LEAD INVESTOR:
Xxxxxxxxx Xxxxxxx, LLP Ceres Financial Limited
By:
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By: Name:
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Name: Title:
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Title:
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