APPENDIX B
ESCROW AGREEMENT
This Escrow Agreement (the " Escrow Agreement") is made and entered into as
a deed as of this ____ day of _________ 2003, by and among Musca Holding
Limited, a company incorporated in accordance with the laws of the British
Virgin Islands ("BVI") under Registration Number 548729 ("Musca"), Trinity
Learning Corporation, a company incorporated in accordance with the laws of
the State of Utah in the United States of America under Entity Number
5118314-0142 ("Trinity") and ▇▇▇▇ ▇▇▇▇▇ of London ("▇▇▇▇ ▇▇▇▇▇"), as escrow
agent (the "Escrow Agent").
A. WHEREAS, Musca, Danlas Limited, a company incorporated in accordance
with the laws of the BVI under Registration Number 548725 ("Danlas"),
and Trinity, have executed the Definitive Agreement ("the Definitive
Agreement") pursuant to which Trinity has agreed to deposit 1000 (one
thousand) ordinary shares of a nominal value of US$1.00 (one United
States Dollar) in the issued share capital of Danlas which represent
100% (one hundred per centum) of the entire issued share capital of
Danlas in negotiable form (as that term is defined in the Definitive
Agreement) into an escrow account with the Escrow Agent ("the Escrow
Shares") pursuant to the terms of this Escrow Agreement; and
B. WHEREAS, ▇▇▇▇ ▇▇▇▇▇ is willing to serve as Escrow Agent pursuant to
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the promises and agreements contained
herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each party hereto, it is
hereby agreed by and among Trinity, Musca and the Escrow Agent as follows:
1. Escrow Deposit
Trinity will deliver or procure the delivery of the Escrow Shares to
the Escrow Agent pursuant to the Definitive Agreement. The Escrow
Agent shall not be required to inquire into the propriety of the
Escrow Shares deposited hereunder nor shall the Escrow Agent be
required to investigate any other matter or arrangement between
Trinity and Musca.
2. Escrow Shares
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2.1 The Escrow Shares shall be available to distribute to Musca or Trinity
pursuant to the provisions of this Escrow Agreement. In the event that
Danlas issues any Additional Escrow Shares (as defined below), such
shares will be issued and delivered to the Escrow Agent in the same
manner as the Escrow Shares to be delivered in terms of this Escrow
Agreement. In the event that Trinity receives such Additional Escrow
Shares, it agrees to deliver such Additional Escrow Shares to the
Escrow Agent.
2.2 Except for dividends paid in stock declared with respect to the Escrow
Shares ("Additional Escrow Shares"), which shall be treated as Escrow
Shares hereunder, dividends payable in securities or other
distributions of any kind (including cash) made in respect of the
Escrow Shares will be delivered to Trinity as its interests appear.
The term "Escrow Shares" as used herein shall also be deemed to
include Additional Escrow Shares. Trinity will have all voting rights
with respect to the Escrow Shares so long as such Escrow Shares are
held in escrow, and the Escrow Agent and Musca will take all
reasonable steps necessary to allow the exercise of such rights. While
the Escrow Shares remain in the Escrow Agent's possession pursuant to
this Escrow Agreement, Trinity will retain and will be able to
exercise all other incidents of ownership of the Escrow Shares that
are not inconsistent with the terms and conditions of this Escrow
Agreement and/or the Definitive Agreement.
2.3 Escrow Period and Release from Escrow
2.3.1. The Escrow Agent may not release the Escrow Shares unless and
until:
2.3.1.1. a written notice, signed by Trinity and Musca addressed to
the Escrow Agent, directs the Escrow Agent to release the
Escrow Shares to the person specified in the notice;
2.3.1.2. delivery is required to give effect to the terms of the
Definitive Agreement, in which event Trinity and Musca shall
be obliged to give the notice contemplated in 2.3.1.1,
or unless an order from a court of competent jurisdiction or
award from an arbitral authority instructs the Escrow Agent as to
how the Escrow Shares should be disbursed.
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Promptly following Escrow Agent's receipt of either of the
foregoing, the Escrow Agent shall make the disbursement specified
therein.
2.3.2. Trinity and Musca hereby irrevocably nominate, constitute and
appoint The Escrow Agent as their attorney and agent to sign and
execute all such documents and to do all such things as it in its
sole and absolute discretion may consider necessary to effect any
transfer of the Escrow Shares contemplated by this Escrow
Agreement.
3. Duties and Responsibilities of Escrow Agent
3.1. Trinity and Musca acknowledge and agree that the Escrow Agent:
3.1.1. shall not be responsible for any of the agreements referred to
herein but shall be obligated only for the performance of such
duties as are specifically set forth in this Escrow Agreement;
3.1.2. shall not be obligated to take any legal or other action
hereunder which might in its judgment involve any expense or
liability unless it shall have been furnished with acceptable
indemnification;
3.1.3. may rely on and shall be protected in acting or refraining from
acting upon any written notice, instruction, instrument,
statement, request or document furnished to it hereunder and
believed by it to be genuine and to have been signed or presented
by the proper person, and shall have no responsibility for
determining the accuracy thereof; and
3.1.4. may consult counsel satisfactory to it, including house counsel,
and the opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with the opinion of such counsel.
3.2. Neither the Escrow Agent nor any of its partners, directors, officers
or employees shall be liable to anyone for any action taken or omitted
to be taken by it or any of its partners, directors, officers or
employees hereunder except in the case of negligence or willful
misconduct.
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3.3. Musca, on the one hand, and Trinity, on the other hand, each agree to
pay one half of the fees which shall be subject to a minimum of
approximately GBP 1000 per annum of, and to reimburse all expenses
(including the reasonable fees and expenses of counsel) incurred by,
the Escrow Agent in performing its duties and responsibilities
hereunder, including the Escrow Agent's reasonable compensation for
its normal services hereunder. The Escrow Agent shall be entitled to
reimbursement on demand for all expenses incurred in connection with
the administration of the escrow created hereby which are in excess of
its compensation for normal services here under, including without
limitation, payment of any legal fees incurred by the Escrow Agent in
connection with resolution of any claim by any party hereunder. In
addition, Musca and Trinity shall be jointly and severally liable for
all fees and expenses contemplated in this clause 3.3.
3.4. Musca and Trinity jointly and severally agree to indemnify the Escrow
Agent on demand against all claims, demands, losses, costs, expenses,
charges, taxation and any other liabilities (including legal fees)
which it may suffer or incur in relation to the resolution of any
claim by any third party arising out of the escrow hereby created. The
indemnity contained in this clause 3.4 shall constitute acceptable
indemnification for the purposes of clause 3.1.2 in respect of the
resolution of any claim by any third party.
3.5. The Escrow Agent may at any time resign as Escrow Agent hereunder by
giving thirty (30) days prior written notice of resignation to Trinity
and Musca. Prior to the effective date of the resignation as specified
in such notice, Trinity and Musca will issue to the Escrow Agent a
written instruction authorizing redelivery of the Escrow Shares to a
bank or trust company that they select. Such bank or trust company
shall have a principal office in the United States of America, shall
have capital, surplus and undivided profits in excess of
US$25 000 000,00 (twenty five million United States Dollars), and
shall have agreed to act as Escrow Agent hereunder and upon such
additional terms and conditions as it, Trinity and Musca shall have
agreed, if any, provided that the original Escrow Agent shall have no
responsibility therefor nor any responsibility for the compensation of
such successor Escrow Agent. If, however, Trinity and Musca shall fail
to name such a successor escrow agent within 20 (twenty) days after
the notice of resignation from the Escrow Agent, then Musca shall be
entitled to name such successor escrow agent. If no successor escrow
agent is named pursuant to the foregoing provisions by the effective
date of the Escrow Agent's resignation, then the Escrow Agent shall
deliver the Escrow Shares to Musca for the benefit of Trinity and/or
Musca, as provided herein, whereupon all obligations of the Escrow
Agent shall be deemed fulfilled, and the Escrow Agreement shall
terminate, provided that the provisions of paragraphs 3.2, 3.3 and 3.4
shall survive the termination of this Escrow Agreement.
3.6. This Escrow Agreement sets forth exclusively the duties of the Escrow
Agent with respect to any and all matters pertinent thereto and no
implied duties or obligations shall be read into this Escrow Agreement
against the Escrow Agent.
4. Dispute Resolution
It is understood and agreed that should any dispute arise with respect
to the delivery, ownership, right of possession, and/or disposition of
the Escrow Shares, or should any claim be made upon such Escrow Shares
by a third party, the Escrow Agent upon receipt of written notice of
such dispute or claim by the parties hereto or by a third party, is
authorized and directed to retain in its possession without liability
to anyone, all or any of the Escrow Shares until such dispute shall
have been settled either by the mutual agreement of the parties
involved or by a final order, decree judgment of a court in England or
an arbitrator, the time for perfection of an appeal of such order,
decree judgment or arbitration award having expired. The Escrow Agent
may, but shall be under no duty whatsoever to, institute or defend any
legal proceedings which relate to the Escrow Shares. The Escrow Agent
shall have the right to retain counsel of its choice in case it
becomes involved in any disagreement, dispute or litigation related to
the Escrow Agreement, the Escrow Shares or otherwise determines that
it is necessary or desirable to consult counsel, and the reasonable
fees and expenses of such counsel shall be reimbursed to the Escrow
Agent as provided in 3 hereof.
5. Jurisdiction and Applicable Law
Trinity, Musca and the Escrow Agent agree that this agreement shall be
governed by the laws of England and consent to the exclusive
jurisdiction of the courts of England.
6. Force Majeure
Neither Trinity, Musca nor the Escrow Agent shall be responsible for
delays or failures in performance resulting from acts beyond their
control. Such acts shall include but not be limited to acts of God,
strikes, lockouts, riots, acts of war, epidemics, governmental
regulations superimposed after the fact, fire, communication line
failures, power failures, computer viruses, earthquakes or other
disasters.
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7. Notices
Any notice or other communication required or permitted to be given
hereunder shall be in writing, shall be delivered by hand or overnight
courier service, or by telefacsimile, and will be deemed given upon
delivery, if delivered personally, will be deemed given 1 (one)
business day (in England) after deposit with a national courier
service for overnight delivery, or will be deemed given 1 (one)
business day (in England) after transmission by telefacsimile with
confirmation of receipt to the following addresses:
If to Trinity: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Telefacsimile Number: ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
If to Musca: ▇/▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇, ▇'▇▇▇▇▇▇▇,
Avenue Princess Grace, Monte Carlo, MONACO
Telefacsimile Number: 09377 9325 6270
If to Escrow
Agent: ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇ ▇▇▇
For attention of: The Market Managing Partner
Telefacsimile Number: ▇▇▇ (▇)▇ ▇▇▇ ▇▇▇ ▇▇▇
or to such other address as may have been furnished by any party to
the others in writing except that notices of change of address shall
only be effective upon receipt.
8. Binding Effect
This Escrow Agreement shall be binding upon the respective parties
hereto and their heirs, executors, successors and assigns.
9. Modifications
This Escrow Agreement may not be altered or modified without the
express written consent of the parties hereto. No course of conduct
shall constitute a waiver of any of the terms and conditions of this
Escrow Agreement, unless such waiver is specified in writing, and then
only to the extent so specified. A waiver of any of the terms and
conditions of this Escrow Agreement on one occasion shall not
constitute a waiver of the other terms of this Escrow Agreement, or of
such terms and conditions on any other occasion.
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10. Judgments
The Escrow Agent is hereby expressly authorized to comply with and
obey orders, judgments or decrees of any court in England. In case the
Escrow Agent obeys or complies with any such order, judgment or decree
of any court of England, the Escrow Agent shall not be liable to any
of the parties hereto or to any other person, firm, corporation or
entity by reason of such compliance, notwithstanding any such order,
judgment or decree being subsequently reversed, modified, annulled,
set aside, vacated or found to have been entered without jurisdiction.
11. Counterparts and cancellation of prior agreement
This Escrow Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which shall
constitute one and the same instrument. In addition, the ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ and Trinity agree that the escrow agreement concluded by and
between them and signed by them on or about 9 October 2003 is upon the
signature hereof hereby cancelled and of no further force and effect.
12. Termination of Escrow
This Escrow Agreement shall terminate and the Escrow Agent shall have
no further duties hereunder upon the distribution of all of the Escrow
Shares.
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to
be executed as a deed as of the day and year first above written.
Executed as a deed by
▇▇▇▇ ▇▇▇▇▇
acting by:
___________________________
Partner
___________________________
Partner
Executed as a deed by
TRINITY LEARNING CORPORATION
acting by _________
who in accordance with the laws of
the territory in which Trinity Learning
Corporation is incorporated is acting
under the authority of Trinity Learning
Corporation
___________________________
Executed as a deed by
MUSCA HOLDING LIMITED
acting by _________
who in accordance with the laws of
the territory in which Musca Holding
Limited is incorporated is acting under
the authority of Musca Holding Limited
___________________________
