ESCROW AGREEMENT
Exhibit
10.2
THIS
ESCROW AGREEMENT (this “Agreement”) is made as of November 14, 2007, by and
among Xxxxx Xxxxx, with an address at 000 Xxxxxxxxxxxx Xxxxx, Xxxxxxxxxx, XX
00000 (“Xxxxx”), Genesis Holdings, Inc., a Texas corporation with an address at
00000 Xxx Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxx, XX 00000 (“Genesis”), Verbena
Pharmaceuticals Inc., a Delaware corporation with an address at 000 Xxxxxxxxxxxx
Xxxxx, Xxxxxxxxxx, XX 00000 (the “Company”) and Xxxxxxx Xxxxxxxxx & Xxxxx
LLP, having an address at 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000
(the “Escrow Agent”). Capitalized terms used but not defined herein shall have
the meanings set forth in the Promissory Notes, Common Stock Purchase Agreement
and Redemption Agreement referred to in the recitals. Hereinafter, Xxxxx,
Genesis and the Company shall be referred to as the “Parties”, each a
“Party.”
WHEREAS,
the Escrow Agent has been advised that the Company has sold an aggregate of
2,500,000 shares (the “Genesis Shares”) of its common stock, par value $.0001
per share (the “Common Stock”) to Genesis in consideration for $16,700 cash and
that certain promissory note in the principal amount of $33,300 issued by
Genesis in favor of the Company (the “Genesis Note”), pursuant to that certain
common stock purchase agreement, dated as of the date hereof, by and between
the
Company and Genesis (the “Common Stock Purchase Agreement”);
WHEREAS,
the Escrow Agent also has been advised that the Company has purchased an
aggregate of 2,500,000 shares (the “Xxxxx Shares” and together with the Genesis
Shares, the “Shares”) of Common Stock from Xxxxx in consideration for $16,700
cash and that certain promissory note in the principal amount of $33,300 issued
by the Company in favor of Xxxxx (the “Xxxxx Note” and together with the Genesis
Note, the “Notes”), pursuant to that certain redemption agreement, dated as of
the date hereof, by and between the Company and Xxxxx (the “Redemption
Agreement”);
WHEREAS,
the Parties have requested that the Escrow Agent hold in escrow and then
distribute the Shares to be released to certain Parties pursuant to this
Agreement.
NOW,
THEREFORE, in consideration of the covenants and mutual promises contained
herein and other good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE
I
TERMS
OF ESCROW
1.1
The
parties hereby agree to establish an escrow account with the Escrow Agent
whereby the Escrow Agent shall hold the Shares, as well as blank stock powers
with respect thereto, pursuant to the terms hereof. The Shares and blank stock
powers will be held by the Escrow Agent in a secured location.
1.2 The
Shares shall be issued to the Parties and released by the Escrow Agent as
follows:
(a)
If
under
the terms and conditions set forth in the Notes, the Common Stock Purchase
Agreement and Redemption Agreement, a Party believes that certain Shares may
be
released from the Escrow Agent, then such Party (the “Requesting Party”) shall
send written notice to the Escrow Agent via facsimile at (000) 000-0000 (the
“Request Notice”). Such Request Notice shall constitute irrevocable instructions
to the Escrow Agent to release and issue the Shares to the Party specified
in
the Request Notice.
(b) Upon
receipt of the Request Notice, the Escrow Agent shall send written notice (the
“Release Notice”) to all Parties except the Requesting Party (the “Remaining
Parties”), indicating that it received the Request Notice to release the Shares.
If the Remaining Parties each do not object in writing within three business
days of receiving the Release Notice, the Escrow Agent shall release the Shares
as provided for in the Request Notice.
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(c) In
the
event the Escrow Agent shall receive written objection from either or both
of
the Remaining Parties within three business days from such Party’s receipt of
the Release Notice, the Escrow Agent shall not release the Shares unless and
until all of the Parties have sent written instruction (the “Instruction”) to
the Escrow Agent by facsimile at (000) 000-0000 indicating that the Parties
have
reached an agreement concerning the Shares and instructing the Escrow Agent
as
to the disposition of the Shares. The Escrow Agent shall release the Shares
in
such manner as set forth in the Instruction. If the Escrow Agent does not
receive an Instruction within five business days from the receipt of a written
objection, Escrow Agent shall have the right, but not the obligation, to deposit
the Shares with the clerk of a court in New York County, New York State and
give
written notice of such deposit to the Parties. Upon such deposit or other
disbursement in accordance with the terms of this Agreement, Escrow Agent shall
be relieved and discharged from all further obligations and responsibilities
hereunder. The Escrow Agent shall not incur any liability whatsoever for acting
upon any notice, direction, waiver, receipt, consent, certificate,
authorization, power of attorney or other paper or document purporting and
believed by the Escrow Agent to be genuine and to be signed and presented by
the
proper person or persons.
1.3 The
parties acknowledge that, although the Escrow Agent is holding the Shares,
the
Escrow Agent is acting solely as a stakeholder at their request and for their
convenience and that Escrow Agent shall not be liable to either party for any
act or omission on its part unless taken or suffered in bad faith or in willful
disregard of this contract on the part of Escrow Agent.
ARTICLE
II
MISCELLANEOUS
2.1 No
waiver
of any breach of any covenant or provision herein contained shall be deemed
a
waiver of any preceding or succeeding breach thereof, or of any other covenant
or provision herein contained. No extension of time for performance of any
obligation or act shall be deemed an extension of the time for performance
of
any other obligation or act.
2.2 Unless
otherwise specified herein, all notices or other communications required or
permitted hereunder shall be in writing, and shall be sent by fax, overnight
courier, registered or certified mail, postage prepaid, return receipt
requested, and shall be deemed properly given and received as set forth in
the
Note.
2.3 This
Escrow Agreement shall be binding upon and shall inure to the benefit of the
permitted successors, assigns, heirs and legatees of the parties
hereto.
2.4 This
Escrow Agreement is the final expression of, and contains the entire agreement
between, the parties with respect to the subject matter hereof and supersedes
all prior understandings with respect thereto. This Escrow Agreement may not
be
modified, changed, supplemented or terminated, nor may any obligations hereunder
be waived, except by written instrument signed by the parties to be charged
or
by their respective agents duly authorized in writing or as otherwise expressly
permitted herein.
2.5 Whenever
required by the context of this Escrow Agreement, the singular shall include
the
plural and masculine shall include the feminine. This Escrow Agreement shall
not
be construed as if it had been prepared by one of the parties, but rather as
if
both parties had prepared the same. Unless otherwise indicated, all references
to Articles are to this Escrow Agreement.
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2.6 The
parties hereto expressly agree that this Escrow Agreement shall be governed
by,
interpreted under and construed and enforced in accordance with the laws of
the
State of New York.
2.7 The
Escrow Agent’s duties hereunder may be altered, amended, modified or revoked
only by a writing signed by the Company, Genesis, Xxxxx and the Escrow
Agent.
2.8 The
Escrow Agent shall be obligated only for the performance of such duties as
are
specifically set forth herein and may rely and shall be protected in relying
or
refraining from acting on any instrument reasonably believed by the Escrow
Agent
to be genuine and to have been signed or presented by the proper party or
parties. The Escrow Agent shall not be personally liable for any act the Escrow
Agent may do or omit to do hereunder as the Escrow Agent while acting in good
faith, excepting only its own gross negligence or willful misconduct, and any
act done or omitted by the Escrow Agent pursuant to the advice of the Escrow
Agent’s attorneys-at-law (other than Escrow Agent itself) shall be conclusive
evidence of such good faith.
2.9 The
Escrow Agent is hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only orders or process of courts of law and is hereby expressly
authorized to comply with and obey orders, judgments or decrees of any court.
In
case the Escrow Agent obeys or complies with any such order, judgment or decree,
the Escrow Agent shall not be liable to any of the parties hereto or to any
other person, firm or corporation by reason of such decree being subsequently
reversed, modified, annulled, set aside, vacated or found to have been entered
without jurisdiction.
2.10 The
Escrow Agent shall not be liable in any respect on account of the identity,
authorization or rights of the parties executing or delivering or purporting
to
execute or deliver the Common Stock Purchase Agreement, Redemption Agreement
or
any documents or papers deposited or called for thereunder or
hereunder.
2.11 The
Escrow Agent shall be entitled to employ such legal counsel, and other experts
as the Escrow Agent may deem necessary properly to advise the Escrow Agent
in
connection with the Escrow Agent’s duties hereunder, may rely upon the advice of
such counsel, and may pay such counsel reasonable compensation therefor.
The
Escrow Agent has acted as legal counsel for the Company, and may continue to
act
as legal counsel for the Company from time to time, notwithstanding its duties
as the Escrow Agent hereunder. Each of the parties hereto consents to the Escrow
Agent in such capacity as legal counsel for the Company and waives any claim
that such representation represents a conflict of interest on the part of the
Escrow Agent. The Company understands that the Company and the Escrow Agent
are
relying explicitly on the foregoing provision in entering into this Escrow
Agreement.
2.12 The
Escrow Agent’s responsibilities as escrow agent hereunder shall terminate if the
Escrow Agent shall resign by written notice to the Company, Xxxxx and Genesis.
In the event of any such resignation, the Company, Xxxxx and Genesis shall
appoint a successor Escrow Agent.
2.13 If
the
Escrow Agent reasonably requires other or further instruments in connection
with
this Escrow Agreement or obligations in respect hereto, the necessary parties
hereto shall join in furnishing such instruments.
2.14 It
is
understood and agreed that should any dispute arise with respect to the delivery
and/or ownership or right of possession of the Shares held by the Escrow Agent
hereunder, the Escrow Agent is authorized and directed in the Escrow Agent’s
sole discretion (i) to retain in the Escrow Agent’s possession without liability
to anyone all or any part of said Shares until such disputes shall have been
settled either by mutual written agreement of the parties concerned by a final
order, decree or judgment of a board of arbitration or a court of competent
jurisdiction after the time for appeal has expired and no appeal has been
perfected, but the Escrow Agent shall be under no duty whatsoever to institute
or defend any such proceedings, or (ii) to deliver the Shares and any other
property and documents held by the Escrow Agent hereunder to a state or Federal
court having competent subject matter jurisdiction and located in the State
and
City of New York in accordance with the applicable procedure
therefor.
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2.15 The
Company, Xxxxx and Genesis agree jointly and severally to indemnify and hold
harmless the Escrow Agent and its partners, employees, agents and
representatives from any and all claims, liabilities, costs or expenses
(including reasonable attorneys’ fees) in any way arising from or relating to
the duties or performance of the Escrow Agent hereunder or the transactions
contemplated hereby or by the Common Stock Purchase Agreement and Note other
than any such claim, liability, cost or expense to the extent the same shall
have been determined by final, nonappealable judgment of a court of competent
jurisdiction to have resulted from the willful misconduct of the Escrow
Agent.
2.16
This
Agreement and any amendment or modification of this Agreement may be executed
in
several counterparts or by separate instruments and all of such counterparts
and
instruments shall constitute one agreement, binding on all of the parties
hereto.
[Remainder
of Page Intentionally Left Blank]
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IN
WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement as
of
this 14th
day of
November, 2007.
PARTIES:
XXXXX
XXXXX
By:
/s/
Xxxxx
Xxxxx
Xxxxx
Xxxxx
GENESIS
HOLDINGS, INC.
By:
/s/
Xxxxxx Xxxxx
Xxxxxx
Xxxxx, Acting Chief Executive Officer
By:
/s/
Xxxxx
Xxxxx
Xxxxx
Xxxxx, President
ESCROW
AGENT:
XXXXXXX
XXXXXXXXX & XXXXX LLP
By:
/s/
Xxxxx
X. Xxxxxxx
Xxxxx
X.
Xxxxxxx, Partner
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