ESCROW AGREEMENT
THIS
ESCROW AGREEMENT
(this
“Agreement”) is made as of December___, 2006, by and among Xxxxx Petroleum
Corporation (f/k/a Express Systems Corporation), a Nevada corporation (the
“Company”), the parties listed as “Purchasers” on the signature pages hereto
(the “Purchasers”), and Rubin, Bailin, Ortoli LLP, as Escrow Agent (the “Escrow
Agent”). Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Securities Purchase Agreement referred to in the first
recital or the Share Exchange Agreement referred to in the fourth recital,
as
applicable.
W
I T N E S S E T H:
WHEREAS,
the
Purchasers have agreed to purchase from the Company, severally and not jointly
with the other Purchasers, up to an aggregate of $10,000,000 of the Units on
the
Closing Date as set forth in the Securities Purchase Agreement (the “Purchase
Agreement”) dated the date hereof between the Purchasers and the Company, which
securities will be issued under the terms and conditions contained herein and
in
the Purchase Agreement;
WHEREAS,
the
consummation of the purchase and sale of the Units under the Purchase Agreement
is subject to certain conditions, including without limitation, the receipt
by
the Company of a Fund Balance Notice (as defined in Section 1.2);
WHEREAS,
the
Company and the Purchasers have requested that the Escrow Agent hold the
Subscription Amounts received from the Purchasers under the Securities Purchase
Agreement in escrow until the Escrow Agent has received a Release Notice in
substantially the form attached hereto as Annex
A
(the
“Release Notice”) from the Company; and
WHEREAS,
the
Company, DWM Petroleum, a Swiss corporation (“DWM”), and Exchanging Shareholders
of DWM entered into a Share Exchange Agreement (the “Exchange Agreement”) on
November 23, 2006, which agreement provides, among other things, as a condition
to the consummation of the acquisition (the “Acquisition”) of shares of DWM,
that the Escrow Agent has received from the Purchasers a minimum of $10,000,000
in subscriptions under the Purchase 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:
TERMS
OF THE ESCROW
1.1. The
parties hereby appoint Rubin, Bailin, Ortoli LLP as Escrow Agent under this
Agreement and agree to pay the Escrow Agent a fee of $10,000 USD (“Escrow
Agent’s Fee”). The parties hereby agree to establish an escrow account with the
Escrow Agent whereby the Escrow Agent shall, subject to the terms of this
Agreement, hold the funds for the purchase of up to an aggregate of $10,000,000
as contemplated by the Purchase Agreement.
1.2. Upon
the
Escrow Agent’s receipt of at least $10,000,000 in Subscription Amounts, the
Escrow Agent shall telephonically or by e-mail provide notice (a “Fund Balance
Notice”) to the Company of the aggregate amount of funds it has received into
its master escrow account.
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(a) As
provided in the Purchase Agreement, after receipt of a Fund Balance Notice
indicating that the Escrow Agent has received an aggregate amount of at least
$10,000,000, the Company, at its sole option, may, at any time on or prior
to
January 31, 2007, agree to a Closing under the Exchange Agreement. If the
Company agrees to such a Closing upon at least $10,000,000, and assuming that
all of the other Closing conditions in the Exchange Agreement and Purchase
Agreement have been or, concurrently with the Closing, will be satisfied, the
Company shall provide an executed Release Notice to the Escrow Agent,
indicating, among other things, that all conditions to the Closing of the
Acquisition and Closing under the Purchase Agreement have been
satisfied.
1.3. Upon
receipt of an executed Release Notice from the Company and the Escrow Agent,
the
Escrow Agent shall wire the aggregate Subscription Amounts then being held
by it
less the Escrow Agent’s Fee to the Company. All Subscription Amounts received by
the Escrow Agent, from the time of such election until the close of business
on
January 31, 2007 (unless such date has been extended by the Company and the
Placement Agents), shall be wired by the Escrow Agent to the Company promptly
after written request of the Company.
1.4. Wire
transfers to the Company shall be made pursuant to written instructions from
the
Company provided to the Escrow Agent.
1.5. Notwithstanding
anything contained herein to the contrary, if, on or prior to January 31, 2007,
the Company elects to close the Acquisition after receiving a Fund Balance
Notice indicating that the Escrow Agent has received an aggregate of at least
$10,000,000, and assuming all other conditions to Closing have been satisfied,
then the Company will take all actions necessary to cause the fully executed
Release Notice to be delivered to the Escrow Agent.
ARTICLE
II
MISCELLANEOUS
2.1. No
waiver
or 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. All
notices or other communications required or permitted hereunder shall be in
writing, and shall be sent as set forth in the Purchase Agreement and Exchange
Agreement.
2.3. This
Escrow Agreement shall be binding upon and shall inure to the benefit of the
permitted successors and permitted assigns of the parties hereto.
2.4. This
Escrow Agreement (with the other Transaction Documents) 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 its agent duly authorized
in writing or as otherwise expressly permitted herein.
2
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
all parties had prepared the same.
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. Any action to enforce, arising out of, or relating in any
way
to, any provisions of this Escrow Agreement shall only be brought in a state
or
federal court sitting in 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 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 and in the absence of gross negligence, fraud and willful misconduct,
and
any act done or omitted by the Escrow Agent pursuant to the advice of the Escrow
Agent’s attorneys-at-law shall be conclusive evidence of such good faith, in the
absence of gross negligence, fraud and willful misconduct.
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 Purchase Agreement or any documents or papers deposited
or called for thereunder in the absence of gross negligence, fraud and willful
misconduct.
2.11. The
Escrow Agent shall be entitled to employ such legal counsel and other experts
as
the Escrow Agent may deem necessary 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. Counsel may also
include partners of the Escrow Agent.
2.12. The
Escrow Agent’s responsibilities as Escrow Agent hereunder shall terminate if the
Escrow Agent resigns by giving written notice to the Company. In the event
of
any such resignation, the parties shall appoint a successor Escrow Agent and
the
Escrow Agent shall deliver to such successor Escrow Agent any escrow funds
and
other documents then held by the Escrow Agent hereunder.
3
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 escrow funds held by the Escrow
Agent hereunder, the Escrow Agent is authorized and directed in the Escrow
Agent’s sole discretion (1) to retain in the Escrow Agent’s possession without
liability to anyone all or any part of said escrow funds until such disputes
shall have been settled either by mutual written agreement of the parties
concerned or by a final order, decree or judgment of 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 (2) to deliver the escrow funds 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
of
New York.
2.15. The
parties hereto 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 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 Purchase Agreement other than any
such claim, liability, cost or expense to the extent the same shall have been
determined by final, unappealable judgment of a court of competent jurisdiction
to have resulted from the gross negligence, fraud or willful misconduct of
the
Escrow Agent.
*
*
*
4
IN
WITNESS WHEREOF,
the
parties hereto have executed this Escrow Agreement as of date first written
above.
XXXXX PETROLEUM CORPORATION | ||
(f/k/a Express Systems Corporation) | ||
|
|
|
By: | ||
Name:
Xxxxxx Xxxxxxxxxx-Xxxxx
|
||
Title: President |
RUBIN, BAILIN, ORTOLI LLP | ||
as Escrow Agent | ||
|
|
|
By: | ||
Name: Xxxxxxx Xxxxxxxxxx, Esq. |
||
Title: Attorney at Law |
[SIGNATURE
PAGES FOR PURCHASERS FOLLOW]
5
[SIGNATURE
PAGE OF PURCHASERS TO ESCROW AGREEMENT]
Name of Investing Entity: | |
Signature of Authorized Signatory of Investing entity: | |
Name of Authorized Signatory: | |
Title of Authorized Signatory: |
6
Annex
A
to
Escrow
Agreement
RELEASE
NOTICE
THE
UNDERSIGNED,
pursuant to the Escrow Agreement, dated as of _________, among Xxxxx Petroleum
Corporation (f/k/a Express Systems Corporation), a Nevada corporation (the
“Company”), the Purchasers signatory thereto and Rubin, Bailin, Ortoli LLP, as
Escrow Agent (the “Escrow Agent”), hereby notify the Escrow Agent that each of
the conditions precedent to (i) the purchase and sale of the Units set forth
in
the Purchase Agreement and (ii) the consummation of the Acquisition contemplated
by the Exchange Agreement have been satisfied. Capitalized terms used herein
and
not defined shall have the meaning ascribed to such terms in the Escrow
Agreement.
The
Company hereby authorizes the Escrow Agent to release all of the aggregate
subscription funds being held in escrow hereunder to the Company.
This
Release Notice may be signed in one or more counterparts, each of which shall
be
deemed an original.
IN
WITNESS WHEREOF,
the
undersigned have caused this Release Notice to be duly executed and delivered
as
of this ____ day of _________ 200_.