Exhibit 10.1
ESCROW AGREEMENT
This Escrow Agreement, dated as of December __, 2001 (this "Agreement"), is
by and among Crest View Inc., a Nevada corporation (the "Company"), and
Southwest Escrow Company, a Nevada trust company (the "Escrow Agent").
WHEREAS, the Company is offering up to 2.1 million units (each a
"Unit"), each Unit consisting of one share of the common stock, par value
$.001 per share, of the Company and one-third (1/3) of a Class A Redeemable
Common Stock Purchase Warrant, by means of a prospectus, dated December __,
2001 (the "Prospectus"), forming a part of the Registration Statement on
Form SB-2, as amended (Registration Number 333-45780), filed by the Company
with the United States Securities and Exchange Commission (the "SEC") and
declared effective by the SEC on December __, 2001;
WHEREAS, pursuant to the Prospectus, the Company is offering for sale
the Units on a self underwritten, best efforts 1.2 million Units minimum
(the "Minimum Offering"), 2.1 million Units maximum (the "Maximum
Offering") basis;
WHEREAS, the Units are being offered and shall be sold at a purchase
price (the "Purchase Price") of $.50 per Unit, for a period (the "Offering
Period") of up to 90 days commencing on the date of this Agreement (the
"Initial Offering Period"), unless extended for an additional period of up
to 90 days at the sole discretion of the Company and upon written notice of
such extension being given to the Escrow Agent on or before the termination
of the Initial Offering Period;
WHEREAS, the Purchase Price may be paid in the form of cash, certified
check, bank check, or a reduction or cancellation of indebtedness of the
Company;
WHEREAS, pursuant to the Prospectus, the proceeds to the Company from
the sale of the Units are to be held in escrow pending the Company's
receipt of subscriptions, acceptable to the Company in the Company's sole
discretion (each, a "Subscription"), sufficient to consummate the Minimum
Offering; and
WHEREAS, the Prospectus contemplates that the Escrow Agent will serve
as escrow agent on the terms and subject to the conditions provided in this
Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement, and other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged,
the parties hereto agree as follows:
1. The Company hereby appoints the Escrow Agent as the Company's agent and
custodian for the purposes of this Agreement, and the Escrow Agent accepts
such appointment, each upon the terms and subject to the conditions set
forth in this Agreement.
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2. During the Offering Period, the Escrow Agent shall do the following:
(a) hold, on the Company's behalf and on behalf of each party
making a Subscription (each, a "Subscriber"), the amounts and
documentation delivered to the Escrow Agent from time to time by the
Company pursuant to section 3 of this Agreement;
(b) deposit all monetary amounts received by the Escrow Agent
representing the Purchase Price from all Subscribers under this
Agreement in a separate account maintained by the Escrow Agent (and
retain all documents evidencing indebtedness of the Company to be
reduced or canceled in payment of an appropriate Purchase Price) which
enables the Escrow Agent to transmit or return appropriate Purchase
Price and/or interest earned on such Purchase Price (or such
documentation) to the Subscriber and/or the Company entitled to such
monetary amounts (and/or such documentation) when the appropriate
event has occurred or fails to occur in accordance with section 6 of
this Agreement;
(c) either deposit the monetary amounts representing the Purchase
Price received from each Subscriber in an interest bearing account or
invest the amounts deposited in short-term securities issued or
guaranteed by the United States Government (all interest paid or
earnings on the amounts so deposited or invested, being "interest");
(d) maintain a complete record of (i) the name, address and
taxpayer identifying number of each Subscriber, (ii) the number of
Units subscribed for by such Subscriber, as acceptable to the Company,
(iii) the Purchase Price received from each Subscriber and (iv) the
form of payment of such Purchase Price; and
(e) otherwise perform the Escrow Agent's duties and
responsibilities under this Agreement.
3. Until funds and/or documentation representing the aggregate Purchase Price
for the Minimum Offering (i.e., $600,000.00) (the "Minimum Offering
Proceeds") are deposited with the Escrow Agent, the Company shall deliver
to the Escrow Agent all proceeds from Subscriptions for the Units received
from Subscribers and acceptable to the Company within two business days
from the date of receipt of such funds and/or documentation by the Company.
4. From time to time during the Offering Period or until the Minimum Offering
Proceeds are received by the Escrow Agent, whichever shall be the first to
occur, the Company shall deliver to the Escrow Agent a statement containing
(i) the name, address and taxpayer identifying number of each Subscriber
whose Subscription is acceptable to the Company, (ii) the number of Units
subscribed for by such Subscriber, as acceptable to the Company, (iii) the
Purchase Price received from each Subscriber and (iv) the form of payment
of such Purchase Price.
5. Following receipt of the Minimum Offering Proceeds during the Offering
Period, the Escrow Agent shall promptly deliver written notice to the
Company confirming the Escrow Agent's receipt of such Minimum Offering
Proceeds.
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6. The Escrow Agent shall deliver the Minimum Offering Proceeds, with
interest, as follows:
(a) To the Company (or in accordance with the Company's written
instructions) promptly in the event that the Escrow Agent has received
the Minimum Offering Proceeds during the Offering Period; or
(b) To the Subscribers, in the amount and form received from them
when tendering their respective Subscriptions, with their allocable
share of interest (if their Purchase Price was paid in monetary form
and not in the form of evidence of indebtedness), promptly, in the
event that the Minimum Offering Proceeds are not received by the
Escrow Agent on or prior to the termination of the Offering Period.
7. In the event that the Minimum Offering Proceeds are disbursed in accordance
with paragraph 6(a) of this Agreement, the Escrow Agent shall deposit any
additional funds and/or documentation representing Subscriptions acceptable
to the Company that the Escrow Agent receives and shall disburse such funds
and/or documentation in accordance with the written instructions of the
Company.
8. The Escrow Agent hereby accepts its obligations under this Agreement, and
represents and warrants that the Escrow Agent has the power and legal
authority to enter into this Agreement and to perform the Escrow Agent's
obligations under this Agreement. The Escrow Agent covenants and agrees
that all property held by the Escrow Agent pursuant to this Agreement shall
be identified as being held in escrow in connection with this Agreement.
The Escrow Agent further covenants and agrees that all documents and
records with respect to the matters subject to and transactions
contemplated by this Agreement will be available, upon reasonable written
notice, for examination by the Company, the SEC or any state "blue sky"
securities authorities.
9. The Escrow Agent shall be entitled to receive from the Company, from time
to time, (a) reasonable compensation for its services rendered under this
Agreement, and (b) reimbursement for any reasonable expenses incurred by
the Escrow Agent hereunder. The Escrow Agent shall not have a lien upon, or
any other right whatsoever to payment from, the property held by the Escrow
Agent pursuant to this Agreement, for or on account of such right to
payment and reimbursement or otherwise.
10. The Escrow Agent shall not have:
(a) any duties or responsibilities hereunder except as expressly
set forth in this Agreement;
(b) investment responsibility with respect to funds or other
property held under this Agreement;
(c) responsibility for ascertaining or taking any action with
respect to calls, conversions, exchanges, maturities, tenders, or
other matters relating to any property held by the Escrow Agent
pursuant to this Agreement; nor
(d) any duty to preserve rights against any parties with respect
to any property held by the Escrow Agent pursuant to this Agreement;
in each event, whether or not the Escrow Agent has or is deemed to
have knowledge or notice of such matters.
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11. The Escrow Agent shall be entitled to rely upon any notice, certificate,
affidavit, letter, document or other communication which is believed by the
Escrow Agent to be genuine and to have been signed or sent by the proper
party or parties, and may rely upon statements contained in such notice,
certificate, affidavit, letter, document, or other communication without
further inquiry or investigation.
12. The Escrow Agent shall not be liable for any action taken in accordance
with the terms of this Agreement, including, without limitation, any
release of amounts held by the Escrow Agent pursuant to this Agreement. The
Escrow Agent shall not be liable for any other action or failure to act
under or in connection with this Agreement, except for the Escrow Agent's
own willful misconduct.
13. In the event of any disagreement between the Company and the Subscribers,
or any other person, or any of them, resulting in an adverse claim to funds
or property held by the Escrow Agent pursuant to this Agreement, the Escrow
Agent shall be entitled, at the Escrow Agent's sole option, to refuse to
comply with any such claim and shall not be liable for damages or interest
to any such person or persons for its failure to comply with such adverse
claims; and the Escrow Agent shall be entitled to continue to so refrain
until:
(a) the rights of the averse claimants shall have been finally
adjudicated by a court of competent jurisdiction; or
(b) all differences shall have been adjusted by agreement and the
Escrow Agent shall have been notified of such in a writing signed by
all interested persons. In the event of such disagreement, the Escrow
Agent, in the Escrow Agent's sole discretion, may file a suit in
interpleader for the purpose of having the respective rights of the
claimants of such funds or other property adjudicated.
14. The Company agrees to indemnify the Escrow Agent, and hold the Escrow Agent
harmless, from and against any and all claims, costs, expenses, demands,
judgments, losses, damages, and liabilities (including, without limitation.
reasonable attorneys' fees and expenses) arising out of or in connection
with this Agreement, including, without limitation, any action brought by
the Escrow Agent pursuant to section 13 of this Agreement, except such as
may be caused by the willful misconduct of the Escrow Agent.
15. The Escrow Agent may at any time resign by giving prior written notice of
such resignation to the Company. The Escrow Agent shall not be discharged
from its duties and obligations under this Agreement until a successor
escrow agent shall have been designated by the Company and such successor
escrow agent shall have executed and delivered an escrow agreement in
substantially the form of this Agreement, and all property then held by the
Escrow Agent pursuant to this Agreement shall have been delivered to such
successor escrow agent.
16. The term of this Agreement shall commence as of the date of this Agreement
and shall terminate upon the earlier to occur of the following:
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(a) disbursement of all amounts held by the Escrow Agent pursuant
to section 6 of this Agreement and satisfaction of the Escrow Agent's
other duties and responsibilities under this Agreement; or
(b) receipt by the Escrow Agent of written notice executed by the
Company providing for the termination of this Agreement and
designating the manner of distribution of the items deposited with the
Escrow Agent.
17. All requests, demands, notices and other communications required or
otherwise given under this Agreement shall be sufficiently given if (a)
delivered by hand against written receipt therefor, (b) forwarded by
overnight courier requiring acknowledgment of receipt or (c) mailed by
postage prepaid, registered or certified mail, return receipt requested
addressed, as follows:
If to the Company, to: Crest View Inc.
1700 West Horizon Ridge Parkway - Suite 202
Henderson, Nevada 89012
Attention: President
with a copy to: Snow Becker Krauss P.C.
605 Third Avenue
New York, New York 10158-0125
Attention: Elliot H. Lutzker, Esq.
if to the Warrant Agent, to:
with a copy to:
or, in the case of any of the parties hereto, at such other address as such
party shall have furnished in writing, in accordance with this section 17,
to the other party to this Agreement. Each such request, demand, notice or
other communication shall be deemed given (x) on the date of delivery by
hand, (y) on the first business day following the date of delivery to an
overnight courier or (z) three business days following mailing by
registered or certified mail.
18. This Agreement shall be binding and inure to the benefit of the parties to
this Agreement and their respective successors and assigns. Nothing in this
Agreement is intended or shall be construed to give any other person any
right, remedy or claim under, in or with respect to this Agreement or any
property held pursuant to this Agreement, except as specifically set forth
in this Agreement.
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19. This Agreement shall be governed by, and be construed and interpreted in
accordance with, the internal laws of the State of Nevada.
20. This Agreement may be entered into in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
Crest View Inc.
By:
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Johnny R. Thomas, President
Southwest Escrow Company
By:
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Dale E. Puhl, President