Exhibit 4.1(iv)(a)
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ESCROW AGREEMENT
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AGREEMENT made this 3rd day of May, 2004 by Sunrise USA Incorporated, ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, (the "Issuer"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Attorney At Law, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ (the
"Escrow Agent").
W I T N E S S E T H :
WHEREAS, the Issuer has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (the "Registration Statement") covering a
proposed dividend distribution of its securities (collectively, the
"Securities," and individually, a "Share") as described on the Information
Sheet; and
WHEREAS, the Issuer proposes to distribute 10,615,724 shares of Securities,
consisting of Issuer's common stock (the "Dividend Securities") to it's
shareholders; and
WHEREAS, the Issuer proposes to establish an escrow account with the Escrow
Agent in connection with the distribution of the Dividend Securities and the
Escrow Agent is willing to establish such escrow account on the terms and
subject to the conditions hereinafter set forth;
NOW THEREFORE, in consideration of the premises and mutual covenants herein
contained, the parties hereto hereby agree as follows:
1 Establishment of Escrow.
1.1 The Issuer shall deliver the Dividend Securities directly to the Escrow
Agent promptly upon issuance (the "Deposited Securities"). The identity owner of
the Dividend Securities shall be included on the Common Stock certificates (the
"Owners").
1.2 The Deposited Securities shall be held for the sole benefit of the
Owners. No transfer or other disposition of Dividend Securities held pursuant to
this Escrow shall be permitted other than by will or the laws of descent and
distribution, or pursuant to a qualified domestic relations order as defined by
the Internal Revenue Code of 1986, as amended, or Title I of the Employee
Retirement Income Security Act, or the rules there under.
2 Disbursement from the Escrow.
2.1 The Deposited Securities shall be delivered to the Issuer for
distribution to the Owner or other registered holder only at the same time as or
after:
(a) the Escrow Agent has received a signed representation from the Issuer,
together with an opinion of Issuer's counsel satisfactory to Escrow Agent, each
of which state that the following events have already occurred and the following
requirements have already been met:
(1) The Issuer or Issuer's affiliate has consummated an acquisition(s) of a
business(es) or assets that will constitute the business (or a line of business)
of the Issuer (the "Business Combination"), which agreement(s), and
(2) The Issuer has filed with the Commission the information specified by the
Issuer's registration statement form and Industry Guides, including financial
statements of the Issuer and the company or business with which it has merged or
acquired (the "Target Company"), and pro forma financial information required by
the Commission and applicable rules and regulations.
2.2 Upon disbursement of the Deposited Securities pursuant to the terms of
this Section 2, the Escrow Agent shall be relieved of all further obligations
and released from all liability under this Agreement.
3 Rights, Duties and Responsibilities of Escrow Agent.
It is understood and agreed that the duties of the Escrow Agent are purely
ministerial in nature, and that:
3.1 The Escrow Agent shall not be responsible for the performance by the
Issuer of its obligations under this Agreement.
3.2 The Escrow Agent shall be entitled to rely upon the accuracy, act in
reliance upon the contents, and assume the genuineness of any notice,
instruction, certificate, signature instrument or other document which is given
to the Escrow Agent pursuant to this Agreement without the necessity of the
Escrow Agent verifying the truth or accuracy thereof. The Escrow Agent shall not
be obligated to make any inquiry as to the authority, capacity, existence or
identity of any person purporting to give any such notice or instructions or to
execute any such certificate, instrument or other document. The Escrow Agent
must, however, determine for himself whether the conditions permitting the
release of the Deposited Securities in the Escrow have been met.
3.3 In the event that the Escrow Agent shall be uncertain as to its duties or
rights hereunder or shall receive instructions with respect to the Escrow which,
in his sole determination, are in conflict either with other instructions
received by him or with any provision of this Agreement, the Escrow Agent, at
his sole option, may deposit the Deposited Securities with the registry of a
court of competent jurisdiction in a proceeding to which all parties in interest
are joined. Upon the deposit by the Escrow Agent of the Deposited Securities
with the registry of any court, the Escrow Agent shall be relieved of all
further obligations and released from all liability hereunder.
3.4 The Escrow Agent shall not be liable for any action taken or omitted
hereunder, or for the misconduct of any employee, agent or attorney appointed by
him, except in the case of willful misconduct. The Escrow Agent shall be
entitled to consult with counsel of his own choosing and shall not be liable for
any action taken, suffered or omitted by him in accordance with the advice of
such counsel.
3.5 The Escrow Agent shall have no responsibility at any time to ascertain
whether or not any security interest exists in the Deposited Securities or any
part thereof or to file any financing statement under the Uniform Commercial
Code with respect to the Deposited Securities or any part thereof.
4 Amendment; Resignation.
This Agreement may be altered or amended only with the written consent of the
Issuer and the Escrow Agent. The Escrow Agent may resign for any reason upon
seven (7) business days written notice to the Issuer. Should the Escrow Agent
resign as herein provided, it shall not be required to accept any deposit, make
any disbursement or otherwise dispose of the Deposited Securities, but its only
duty shall be to hold the Deposited Securities for a period of not more than ten
(10) business days following the effective date of such resignation, at which
time
(a) if a successor escrow agent shall have been appointed and written notice
thereof (including the name and address of such successor escrow agent) shall
have been given to the resigning Escrow Agent by the Issuer and such successor
escrow agent, the resigning Escrow Agent shall deliver to the successor escrow
agent the Deposited Securities, or
(b) if the resigning Escrow Agent shall not have received written notice signed
by the Issuer and a successor escrow agent, then the resigning Escrow Agent
shall promptly deliver the Deposited Securities to the Issuer, and the resigning
Escrow Agent shall notify the Issuer in writing of its liquidation and
distribution of the Deposited Securities; whereupon, in either case, the Escrow
Agent shall be relieved of all further obligations and released from all
liability under this Agreement. Without limiting the provisions of Section 6
hereof, the resigning Escrow Agent shall be entitled to be reimbursed by the
Issuer for any expenses incurred in connection with its resignation, transfer of
the Deposited Securities to a successor Escrow Agent or distribution of the
Deposited Securities pursuant to this Section 4.
5 Representations and Warranties.
The Issuer hereby represents and warrants to the Escrow Agent that:
5.1 No party other than the parties hereto and the Owners have, or shall
have, any lien, claim or security interest in the Deposited Securities or any
part thereof.
5.2 No financing statement under the Uniform Commercial Code is on file in
any jurisdiction claiming a security interest in or describing (whether
specifically or generally) the Deposited Securities or any part thereof.
6 Fees and Expenses.
The Escrow Agent shall be entitled to a fee of $1,000.00 (the "Escrow Agent
Fee"), payable upon execution of this Agreement. In addition, the Issuer agrees
to reimburse the Escrow Agent for any reasonable expenses incurred in connection
with this Agreement, including, but not limited to, reasonable counsel fees, but
not including the review of this Agreement.
7 Indemnification and Contribution.
7.1 The Issuer (referred to as the "Indemnitor") agrees to indemnify the
Escrow Agent and his employees, agents and affiliates (jointly and severally the
"Indemnitees") against, and hold them harmless of and from, any and all loss,
liability, cost, damage and expense, including, without limitation, reasonable
counsel fees, which the Indemnitees may suffer or incur by reason of any action,
claim or proceeding brought against the Indemnitees arising out of or relating
in any way to this Agreement or any transaction to which this Agreement relates,
unless such action, claim or proceeding is the result of the willful misconduct
of the Indemnitees.
7.2 If the indemnification provided for in this Section 7 is applicable, but
for any reasons held to be unavailable, the Indemnitor shall contribute such
amounts as are just and equitable to pay, or to reimburse the Indemnitees for,
the aggregate of any and all losses, liabilities, costs, damages and expenses,
including counsel fees, actually incurred by the Indemnitees as a result of or
in connection with, and any amount paid in settlement of any action, claim or
proceeding arising out of or relating in any way to any actions or omissions of
the Indemnitor.
7.3 Any Indemnitee which proposes to assert the right to be indemnified under
this Section 7, promptly after receipt of notice of commencement of any action,
suit or proceeding against such Indemnitee in respect of which a claim is to be
made against the Indemnitor under this Section 7, will notify the Indemnitor of
the commencement of such action, suit or proceeding, enclosing a copy of all
papers served, but the omission so to notify the Indemnitor of any such action,
suit or proceeding shall nor relieve the Indemnitor from any liability which
they may have to any Indemnitee otherwise than under this Section 7. In case any
such action, suit or proceeding shall be brought against any Indemnitee and it
shall notify the Indemnitor of the commencement thereof, the Indemnitor shall be
entitled to participate in and, to the extent that they shall wish, to assume
the defense thereof, with counsel satisfactory to such Indemnitee. The
Indemnitee shall have the right to employ its counsel in any such action, but
the fees and expenses of such counsel shall be at the expense of such Indemnitee
unless (i) the employment of counsel by such Indemnitee has been authorized by
the Indemnitor, (ii) the Indemnitee shall have concluded reasonably that there
may be a conflict of interest among the Indemnitor and the Indemnitee in the
conduct of the defense of such action (in which case the Indemnitor shall not
have the right to direct the defense of such action on behalf of the Indemnitee)
or (iii) the Indemnitor in fact shall not have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses of counsel
shall be borne by the Indemnitor.
7.4 The Indemnitor agrees to provide the Indemnitees with copies of all
registration statements pre- and post-effective amendments to such registration
statements including exhibits, whether filed with the SEC prior to or subsequent
to the disbursement of the Deposited Proceeds.
7.5 The provisions of this Section 7 shall survive any termination of this
Agreement, whether by disbursement of the Deposited Proceeds, resignation of the
Escrow Agent or otherwise.
8 Governing Law and Assignment.
This Agreement shall be construed in accordance with and governed by the laws of
the State of Ohio and shall be binding upon the parties hereto and their
respective successors and assigns; provided, however, that any assignment or
transfer by any party of its rights under this Agreement or with respect to the
Deposited Proceeds shall be void as against the Escrow Agent unless:
(a) written notice thereof shall be given to the Escrow Agent; and
(b) the Escrow Agent shall have consented in writing to such assignment or
transfer.
9 Notices.
All notices required to be given in connection with this Agreement shall be sent
by registered or certified mail, return receipt requested, or by hand delivery
with receipt acknowledged, or by the Express Mail service offered by the United
States Post Office, and addressed, if to the Issuer, at its address set forth
above, and if to the Escrow Agent, at his address set forth above, or to such
other address as either party provides to the other pursuant to the notification
process set forth herein.
10 Severability.
If any provision of this Agreement or the application thereof to any person or
circumstance shall be determined to be unpaid or unenforceable, the remaining
provisions of this Agreement or the application of such provision to persons or
circumstances other than those to which it is held invalid or unenforceable
shall not be affected thereby and shall be valid and enforceable to the fullest
extent permitted by law.
11 Pronouns.
All pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular, or plural as the context may require.
12 Captions.
All captions are for convenience only and shall not limit or define the term
thereof.
13 Execution in Several Counterparts.
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 herein.
14 Entire Agreement.
This Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof and supersedes all prior agreements and
understandings (written or oral) of the parties in connection herewith.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the day
and year first above written.
ISSUER:
SUNRISE USA INCORPORATED
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Title
ESCROW AGENT:
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/S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Signature
