Exhibit 10.1
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement") is entered into as of the
_____ day of October, 2000, by and among Roex, Inc., a California corporation
("Issuer"), RH Investments Corporation ("Placement Agent"), and Wells Fargo,
National Association ("Escrow Agent")
R E C I T A L S:
A. Issuer propose to offer for sale to subscribers an aggregate of
1,000,000 shares of the capital stock of Issuer, having a no par value (the
"Shares") at a price of $6.00 per Share, payable at the time of subscribing for
a Share. 500,000 shares and the proceeds therefrom shall be subject to this
Agreement. The payment of $3,000,000 for at least 500,000 Shares will be paid
into the escrow created by this Agreement.
B. Issuer intends to sell the Shares on a best-efforts "minimum or
none" basis in a public offering (the "Offering") by delivering to each
subscriber a Prospectus (the "Prospectus") describing the Offering.
C. Issuer desire to establish an escrow account in which funds received
from subscribers would be deposited pending completion of the period during
which the Escrow Account shall be open (the "Escrow Period"). Wells Fargo,
National Association, serve as Escrow Agent in accordance with the terms and
conditions set forth herein.
AGREEMENT:
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. Issuer hereby appoints Wells Fargo, National Association, as Escrow
Agent and Escrow Agent shall establish an escrow account (the "Escrow Account")
on its books styled "Roex Subscription Account." Commencing upon the execution
of this Agreement, Escrow Agent shall act as Escrow Agent and hereby agrees to
receive and disburse the proceeds from the offering of the Shares in accordance
with the terms here of. Issuer agrees to notify the Escrow Agent promptly of the
closing of the offering and sale of the Shares.
2. Issuer or Placement Agent shall cause all checks received from
subscribers for Shares to be promptly deposited into the Escrow Account. Issuer
or Placement Agent shall deliver to the Escrow Agent checks of the subscribers
made payable to the Roex Subscription Account or endorsed to the Roex
Subscription Account. Any checks that are received by Escrow Agent that are not
made payable or endorsed to the Roex Escrow Account shall be returned to the
Issuer. Issuer or Placement Agent shall furnish to the Escrow Agent at the time
of each deposit of the above-mentioned funds a list containing the name of each
subscriber, the subscriber's address, the number of Shares subscribed for, and
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the amount of the check being delivered to the Escrow Agent. Prior to the
receipt of the Minimum (as described below), the Issuer is aware and understands
that it is not entitled to any proceeds from subscriptions deposited into the
Escrow Account and no amounts deposited in the Escrow Account during the Escrow
Period shall become the property of the Issuer or any other entity, or be
subject to the debts of the Issuer or any other entity.
3. The Escrow Period shall commence on the date hereof and shall
terminate ten (10) Business Days (as defined below) following the earlier to
occur of the following dates:
(a) The date upon which Escrow Agent confirms upon
written request of the Issuer that it has received
into the Escrow Account and collected gross
subscription proceeds from the sale of 500,000 Shares
aggregating $3,000,000 in deposited funds (the
"Minimum") assuming that, prior to such date, the
SB-2 Registration Statement as amended, File Number
333-92299 has been declared effective by the
Securities and Exchange Commission; or
(b) The "Cessation Date," which for the purposes of this
Agreement shall be January ___, 2001, except as
extended in writing by the agreement of parties for a
period not to exceed an additional sixty (60) days.
(c) The date upon which a determination is made by the
Issuer to terminate the Offering prior to the sale of
the Minimum, as communicated to Escrow Agent in
writing.
Upon the occurrence of any of the events described in (a), (b)
or (c) above, the Escrow Period shall continue for such ten (10) Business-Day
period solely for the limited purposes of collecting subscribers' checks that
have been deposited prior to such event and disbursing funds from the Escrow
Account as provided herein. Escrow Agent will not accept deposits of
subscribers' checks after notice that any of the events described in
subparagraphs (a), (b) and (c) has occurred.
"Business Day" shall mean a day on which commercial banks in
Los Angeles, California, are open for the general transaction of business. If
any action or time for performance pursuant to this Agreement is to occur on any
Saturday, Sunday or holiday, such time for action or performance shall be
extended to the next Business Day.
4. The Escrow Agent will deposit the subscribers' checks for collection
and credit the proceeds to the Escrow Account to be held by it under the terms
of this Agreement. Notwithstanding anything to the contrary contained herein,
Escrow Agent is under no duty or responsibility to enforce collection of any
checks delivered to Escrow Agent hereunder. The Escrow Agent hereby is
authorized to forward each check for collection and deposit the proceeds in the
Escrow Account. As an alternative, the Escrow Agent may telephone the bank on
which the check is drawn to confirm that the check has been paid. Additionally,
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to insure that such funds have cleared normal banking channels for collection,
Escrow Agent is authorized to hold for ten (10) Business Days funds to be
released. Issuer shall immediately reimburse Escrow Agent any monies paid to it
if thereafter the subscriber's check is returned unpaid. Any item returned
unpaid to the Escrow Agent on its first presentation for payment shall be
returned to Issuer and need not be again presented by the Escrow Agent for
collection. Issuer agrees to reimburse Escrow Agent for the cost incurred with
any returned check. The Escrow Agent shall not be required to invest any funds
deposited in the Escrow Account and shall in no event be liable for any
investment loss. For purposes of this Agreement, the term "collected funds" or
the term "collected" when referring to the proceeds of subscribers' checks shall
mean all funds received by Escrow Agent that have cleared normal banking
channels and are in the form of cash
5. If prior to the Cessation Date, subscribers' checks in an amount of
at least the Minimum have been deposited in the Escrow Account, upon request
from Issuer, Escrow Agent will confirm the amounts collected by it from
subscribers' checks. If such amount is at least equal to the Minimum, the Issuer
may send Escrow Agent a written notice providing a list of all accepted
subscribers, specifying the total amount of their subscription to be remitted to
Issuer, and containing a request to terminate the Escrow Period and remit such
amount, less any fees or other amounts then owing from Issuer to Escrow Agent
hereunder, to the Issuer as promptly as possible, but in no event later than ten
(10) Business Days after such termination, by issuing its bank check payable to
the Issuer or by depositing such amount directly into the account of Issuer if
maintained with Wells Fargo Bank, National Association, as designated in writing
by Issuer to Escrow Agent. The Escrow Period shall not terminate upon receipt by
Escrow Agent of such notice, but shall continue for such (10) Business-Day
period solely for the limited purposes of collecting subscribers' checks that
have been deposited prior to Escrow Agent's receipt of such notice and
disbursing funds from the Escrow Account as provided herein. Escrow Agent will
not accept deposits of subscribers' checks after receipt of such notice.
If, on the Cessation Date, the Minimum Amount has not been
deposited with the Escrow Agent and collected, or if Issuer notifies the Escrow
Agent in writing that Issuer elects to terminate the Offering as provided in
paragraph 3(c) above, the Escrow Agent shall then issue and mail its bank checks
to the subscribers in the amount of the subscribers' respective checks, without
deduction, penalty or expense to the subscriber, and shall, for this purpose, be
authorized to rely upon the names and addresses of subscribers furnished it as
contemplated above. No subscriber shall be paid interest with respect to such
deposited funds. The purchase money returned to each subscriber shall be free
and clear of any and all claims of the Issuer and any of its creditors. For each
subscription for which the Escrow Agent has not collected funds but has
submitted the subscriber's check for collection, the Escrow Agent shall promptly
issue a check to such subscriber in the amount of the collected funds from such
subscriber's check after the Escrow Agent has collected such funds. If Escrow
Agent has not yet submitted such subscriber's check for collection, the Escrow
Agent shall promptly remit the subscriber's check directly to such subscriber.
At such time as Escrow Agent shall have made the payments and
remittances provided in the Agreement, the Escrow Agent shall be completely
discharged and released of any and all further liabilities and responsibilities
hereunder.
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6. As consideration for its agreement to act as Escrow Agent as herein
described, Issuer agrees to pay the Escrow Agent an administration fee of
$__________ upon execution of this Agreement, plus the fees described on the
attached fee schedule. Further, Issuer agrees to pay all disbursements and
advances incurred or made by the Escrow Agent in performance of its duties
hereunder, including reasonable fees, expenses and disbursements of its counsel,
all in accordance with the attached fee schedule or the other provisions of this
Agreement. No such fees or reimbursements shall be paid out of or chargeable to
the funds on deposit in the Escrow Account until such time as the Minimum has
been collected.
If the Issuer rejects any subscription for which Escrow Agent has
already collected funds, the Escrow Agent shall promptly issue a refund check to
the rejected subscriber in the amount of the subscriber's check. If the Issuer
rejects any subscription for which the Escrow Agent has not yet collected funds
but has submitted the subscriber's check for collection, the Escrow Agent shall
promptly issue a check in the amount of the collected funds from the
subscriber's check to the rejected subscriber after the Escrow Agent has cleared
such funds. If Escrow Agent has not yet submitted a rejected subscriber's check
for collection, the Escrow Agent shall promptly remit the subscriber's check
directly to the subscriber.
7. This Agreement shall automatically terminate upon the earlier of (i)
twenty (20) days after the Cessation Date or (ii) twenty (20) days after the
date upon which the Escrow Agent has delivered the final portion of Escrow
Account funds pursuant to the terms of this Agreement.
8. It is understood that the Escrow Agent reserves the right to resign
as Escrow Agent at any time by giving written notice of its resignation,
specifying the effective date thereof, to each other party hereto. Within thirty
(30) days after receiving the aforesaid notice, the other party or parties
hereto shall appoint a successor Escrow Agent to which the Escrow Agent may
distribute the property then held hereunder, less its fees, costs and expenses
(including counsel fees and expenses) which may remain unpaid at that time. If a
successor Escrow Agent has not been appointed and has not accepted such
appointment by the end of such thirty (30) day period, the Escrow Agent may
apply to a court of competent jurisdiction for the appointment of a successor
Escrow Agent and the fees, costs and expenses (including reasonable counsel fees
and expenses) which it incurs in connection with such a proceeding shall be paid
by the Company.
9. The parties hereto agree that the following provisions shall control
with respect to the rights, duties, liabilities, privileges and immunities of
the Escrow Agent:
(a) Escrow Agent shall have no obligation to invest the
Escrow Account.
(b) The Escrow Agent shall have no responsibility
except for the safekeeping and delivery of the
amounts deposited in the Escrow Account in
accordance with this Agreement. The Escrow Agent
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shall not be liable for any act done or omitted to
be done under this Agreement or in connection with
the amounts deposited in the Escrow Account, except
as a result of the Escrow Agent's gross negligence
or willful misconduct. The Escrow Agent is not a
party to nor is it bound by, nor need it give
consideration to the terms of provisions of, even
though it may have knowledge of, (i) any agreement
or undertaking by, between or among the Issuer and
any other party, except this Agreement, (ii) any
agreement or undertaking that may be evidenced by
this Agreement, (iii) any other agreements that may
now or in the future be deposited with the Escrow
Agent in connection with this Agreement. The Escrow
Agent is not a party to, is not responsible for, and
makes no representation with respect to the offer,
sale or distribution of the Shares including, but
not limited to, matters set forth in any offering
documents prepared and distributed in connection
with the offer, sale and distribution of the Shares.
The Issuer covenants that it will not commence any
action against the Escrow Agent at law, in equity,
or otherwise as a result of any action taken or
thing done by the Escrow Agent pursuant to this
Agreement, or for any disbursement made as
authorized herein upon failure of the Issuer to give
the notice within the times herein prescribed. The
Escrow Agent has no duty to determine or inquire
into any happening or occurrence of or of any
performance or failure of performance of the Issuer
or of any other party with respect to agreements or
arrangements with any other party. If any question,
dispute or disagreement arises among the parties
hereto and/or any other party with respect to the
funds deposited in the Escrow Account or the proper
interpretation of this Agreement, the Escrow Agent
shall not be required to act and shall not be held
liable for refusal to act until the question or
dispute is settled, and the Escrow Agent has the
absolute right at its discretion to do either or
both of the following:
(i) withhold and/or stop all further performance
under this Agreement until the Escrow Agent
is satisfied, by receipt of a written
document in form and substance satisfactory
to the Escrow Agent and executed and binding
upon all interested parties hereto (who may
include the subscribers), that the question,
dispute, or disagreement had been resolved;
or
(ii) file a suit in interpleader and obtain by
final judgment, rendered by a court of
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competent jurisdiction, an order binding all
parties interested in the matter. In any
such suit, or should the Escrow Agent become
involved in litigation in any manner
whatsoever on account of this Agreement or
the Escrow Account, the Escrow Agent shall
be entitled to recover from the Issuer its
attorneys' fees and costs.
The Escrow Agent shall never be required to post a
bond in connection with any services hereunder. The
Escrow Agent may consult with counsel of its own
choice and shall have full and complete authorization
and protection for and shall not be liable for any
action taken or suffered by it hereunder in good
faith and believed by it to be authorized hereby, nor
for action taken or omitted by it in accordance with
the advice of such counsel (who shall not be counsel
for the Issuer).
(c) The Escrow Agent shall be obligated only for the
performance of such duties as are specifically set
forth in this Agreement and may rely and shall be
protected in acting or refraining from acting upon
any written notice, instruction or request furnished
to it hereunder and believed by it to be genuine and
to have been signed or presented by the proper party
or parties and to take statements made therein as
authorized and correct without any affirmative duty
of investigation.
(d) The Issuer hereby agrees to indemnify the Escrow
Agent for, and to hold it harmless against, any loss,
liability, or expense (including, without limitation,
all legal expenses incurred in enforcing any of the
provisions of this Agreement or otherwise in
connection herewith) incurred without gross
negligence or willful misconduct on the part of the
Escrow Agent, arising out of or in connection with
its entering into this Agreement and carrying out its
duties hereunder, including the costs and expenses of
defending itself against any claim of liability
hereunder or arising out of or in connection with the
sale of the Shares. This covenant shall survive the
termination of this Agreement.
(e) The Escrow Agent shall not be bound by any
modification, amendment, termination, cancellation,
rescission or supersession of this Agreement unless
the same shall be in writing and signed by all of the
other parties hereto and, if its duties as Escrow
Agent hereunder are affected thereby, unless it shall
have given prior written consent thereto.
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(f) Escrow Agent shall not be liable for any damage,
loss, liability, or delay caused by accidents,
strikes, fire, flood, war, riot, equipment breakdown,
electrical or mechanical failure, acts of God or any
cause which is reasonably unavoidable or beyond its
reasonable control.
10. Notices required to be sent hereunder shall be delivered by hand,
sent by an express mail service or sent via United States mail, postage prepaid,
certified, return receipt requested, or via facsimile: to the following address:
If to Placement Agent: RH Investment Corporation
15760 Ventura Boulevard
Suite 1732
Encino, CA 91436
Attention: Stuart Greenberg
If to Issuer: Roex, Inc.
2081 Business Center Drive
Suite 185
Irvine, CA 92612
Attention: Rod Burreson
If to Escrow Agent Wells Fargo Bank, NA
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Attention: ____________________
No notice to the Escrow Agent shall be deemed to be delivered
until actually received by the Escrow Agent. From time to time any party hereto
may designate an address other than the address listed above by giving the other
parties hereto not less than five (5) days advance notice of such change in
address in accordance with the provisions hereof.
11. This Agreement shall be construed, enforced and administered in
accordance with the laws of the State of California.
12. This Agreement may be executed in two or more counterparts, all of
which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
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EXECUTED on the date first written above.
ISSUER:
Roex, Inc.
By: _________________________
Name: Rodney H. Burreson
Title: President
ESCROW AGENT:
Wells Fargo Bank, National Association
By: _________________________
Name: _________________________
Title: _________________________
PLACEMENT AGENT:
RH Investment Corporation
By: _________________________
Name: Stuart Greenberg
Title: Managing Director
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