Ex. 10.2-7
EXHIBIT 10.2
FORM OF SUBSCRIPTION ESCROW AGREEMENT
Letter of Escrow Instructions
To:
Corporate Trust/Agency Administration
Win or Lose Acquisition Corporation - Subscription Escrow,
__________________ Bank Escrow No. ___________
The undersigned will cause to be delivered, to _____________,
hereinafter called Escrow Agent, the papers, money or property hereinafter
described to be held and disposed of by Escrow Agent in accordance with the
following instructions and upon the terms and conditions hereinafter set forth,
to which the undersigned agree:
1. ESCROW PURPOSE:
1.1 This escrow is a single party clearing and holding escrow established
by Win or Lose Acquisition Corporation, of Clearwater, Florida, (the
"Company"). There are no other parties to this escrow.
1.2 The purpose of this escrow is to receive, clear and hold subscription
payments ("Subscription Funds") from certain persons ("Subscribers")
who subscribe to purchase up to 500,000 shares of the $0.001 par value
common stock ("Common Stock") of the Company. The Common Stock will be
offered to the public at a price of $0.25 per share for a period of 90
days commencing on _____________ and ending on _____________ (the
"Termination Date"). The offering will be conducted on a "best-efforts,
all nor none basis" pursuant to an effective registration statement
under the Securities Act of 1933 (Registration No. 333-___________).
1.3 The Company reserves the right to close the escrow at any time after
the receipt of subscriptions for 500,000 shares of Common Stock, but
shall not be obligated to do so. The Company also reserves the right to
terminate the offering and instruct the escrow agent to return the
Subscription Funds to the Subscribers.
2. ESCROW DEPOSITS:
2.1 The Escrow Deposits will be in the form of checks, bank wire transfers
and other instruments of payment in favor of "____________ Bank -
Subscription Escrow Agent for Win or Lose Acquisition Corporation."
2.2 The Subscribers will deliver checks and other instruments of payment
directly to Escrow Agent together with manually signed original
Subscription Agreements and such other documents as may be necessary to
establish the Subscriber's name, address and social security number,
and number of shares subscribed to the satisfaction of the Escrow
Agent. In accordance with Rule 15c2-4 under the Securities Exchange Act
of 1934, the Company agrees to deliver any subscription documents and
instruments of payment received by it to the Escrow Agent by noon of
the next business day after receipt thereof
2.3 The Escrow Agent shall accept deposits to the Escrow Account for the
entire offering period, without reference to the amount of Subscription
Funds then on deposit therein. The Subscription Funds on deposit in the
Escrow Account shall not become the property of the Company until the
Escrow Agent has received and cleared subscriptions for at least
$125,000. Upon deposit, however, all Subscription Funds will be subject
to the terms of this Agreement. The Subscription Funds are to be
invested by Escrow Agent from time to time in a
________________________________ account without further instruction.
<PAGE>
2.4 Any checks or other instruments of payment that have been presented for
payment and have been dishonored are to be presented for payment a
second time. Any checks or other instruments of payment that have been
dishonored twice are to be immediately returned to the Subscriber, with
copies to the Company.
3. ESCROW DISBURSEMENTS:
3.1 In the event the Escrow Agent has not received and cleared a total of
$125,000 in Subscription Funds on the Termination Date, or the Company
has not delivered to the Escrow Agent a certificate that all other
conditions precedent to the sale of the Common Stock have been
satisfied, the Escrow Agent shall promptly refund to each Subscriber
the Subscription Funds submitted on his behalf, together with interest,
if any, earned on such Subscription Funds during the time the
Subscription Funds have been collected and are available for
investment. Escrow Agent shall distribute the interest earned on the
Escrow Account to the Subscriber, pro rata, according to the amount and
date of each deposit. Notwithstanding the foregoing, the Subscribers
are not parties to this Escrow. No checks, funds or other property are
to be disbursed to any Subscriber except in accordance with the
provisions of this Section 3.
3.2 If the collected Subscription Funds on deposit in the escrow are more
than $125,000 on the Termination Date, the Escrow Agent shall prepare a
summary compilation that identifies each Subscriber, states the date
when the Subscription was received by the Escrow Agent, and states the
number of shares of common stock subscribed for. The Company shall then
promptly review the compilation prepared by the Escrow Agent and reject
sufficient subscriptions to eliminate any excess subscriptions and
reduce the total Subscription Funds to exactly $125,000. The Company
reserves the right to partially reject subscriptions and shall endeavor
to reject subscriptions in a manner reasonably calculated to result in
an even distribution of its Common Stock among the Subscribers. After
completing this process, the Company shall prepare a definitive list
that identifies each Subscriber and states the number of shares of
Common Stock that will be sold to such Subscriber.
3.3 Upon receipt of the definitive subscription list prepared by the
Company, Escrow Agent shall promptly remit to each Subscriber who has
submitted a subscription that was rejected in whole or in part by the
Company any excess Subscription Funds attributable to his Subscription,
together with interest during the time the Subscription Funds have been
collected and are available for investment.
3.2 When the Company has rejected any excess subscriptions, the excess
Subscription Funds have been refunded to the Subscribers, the Escrow
Agent has retained exactly $125,000 in Subscription Funds, and the
Company has delivered to the Escrow Agent a certificate that all
conditions precedent to the sale of the Common Stock have been
satisfied, the Escrow Account shall close and all of the funds then on
deposit in the Escrow Account shall then be promptly and directly
transferred to the Rule 419 escrow that has been created by the Company
and the Escrow Agent pursuant to an agreement of even date.
4. NO MODIFICATION:
4.1 After the deposit of any Subscription Funds or checks, these
instructions shall not be modified, rescinded or amended.
5. TERMINATION OF ESCROW:
5.1 This Escrow shall terminate on ________________. On the termination of
this Escrow all Subscription Funds shall be disbursed in the manner
described above. In no event will the Escrow Agent be required to
disburse its own funds or any uncollected funds.
6. GENERAL PROVISIONS:
6.1 All parties understand and agree that Escrow Agent is not a principal,
participant, or beneficiary of the underlying transaction that
necessitates this Agreement. 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 acting or refraining from acting
on any instrument believed by it to be genuine and to have been signed
or presented by the proper party or parties, their officers,
representatives or agents. The Escrow Agent shall not be liable for any
action taken or omitted by it 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 its counsel. Escrow Agent shall be responsible for
holding, investing and disbursing the Escrowed Assets pursuant to the
Agreement, but in no event shall be liable for any exemplary or
consequential damages in excess of Escrow Agent's fee hereunder.
6.2 Unless otherwise provided herein, the Escrow Agent shall accept the
Escrowed Assets pursuant to the Agreement and invest such assets at the
written request of the parties hereto specifying with particularity or
by accompanying schedule the type and identity of the assets to be
deposited. Acceptance of the Escrowed Assets shall be communicated by
Escrow Agent to parties by account statement or otherwise in writing as
soon as practicable after receipt, and any discrepancies shall be noted
to Escrow Agent by the parties in writing within forty five (45) days
of receiving such communication. Failure to note any discrepancies
shall be deemed confirmation of the description of Escrowed Assets
listed on the report regardless of any variations from the original
schedule. Any request to invest assets shall be in writing or facsimile
and specify the type of investment to be made, the maturity date, and
the principal amount to be invested. The Escrow Agent shall not be
liable for delay or failure to invest funds without written
instructions or for losses on any investments made by it pursuant to
and in compliance with such instructions.
6.3 Should any controversy arise between the undersigned with respect to
this Escrow Agreement or with respect to the right to receive the
Escrowed Assets, Escrow Agent shall have the right to consult counsel
and/or to institute a bill of interpleader in any court of competent
jurisdiction to determine the rights of the parties. In the event it is
a party to any dispute, Escrow Agent shall have the additional right to
refer such controversy to binding arbitration. Should such actions be
necessary, or should Escrow Agent become involved in litigation in any
manner whatsoever on account of this Escrow Agreement of the Escrowed
Assets made hereunder, the undersigned hereby bind and obligate
themselves, their heirs and legal representatives to pay Escrow Agent,
in addition to any charge made hereunder for acting as Escrow Agent,
reasonable attorney's fees incurred by Escrow Agent, and any other
disbursements, expenses, losses, costs and damages in connection with
and resulting from such actions.
6.4 The Escrow Agent shall have no liability under, or duty to inquire
beyond the terms and provisions of the Agreement, and it is agreed that
its duties are purely ministerial in nature, and that the Escrow Agent
shall incur no liability whatsoever except for willful misconduct or
gross negligence so long as it has acted in good faith. The Escrow
Agent shall not be bound by any modification, amendment, termination,
cancellation, rescission or supersession of this Escrow 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.
6.5 The Escrow Agent may at any time resign hereunder by giving written
notice of its resignation to the other parties hereto, at their address
set forth herein, at least ten (10) days prior to the date specified
for such resignation to take effect, and upon the effective date of
such resignation, the Escrowed Assets hereunder shall be delivered to
such person as may be designated in writing by the appropriate parties
executing this Escrow Agreement, whereupon all the Escrow Agent's
obligations hereunder shall cease and terminate. The Escrow Agent's
sole responsibility until such termination shall be to keep safely all
Escrowed Assets and to deliver the same to a person designated by the
appropriate parties executing this Escrow Agreement or in accordance
with the directions of a final order or judgment of a court of
competent jurisdiction.
6.6 The parties agree to indemnify, defend and hold the Escrow Agent
harmless from and against any and all loss, damage, tax, liability and
expense that may be incurred by the Escrow Agent arising out of or in
connection with its acceptance or appointments as Escrow Agent
hereunder, including costs and expenses of defending itself against any
claim or liability in connection with its performance hereunder.
6.7 The parties jointly and severally agree to pay to the Escrow Agent its
fees for the services rendered pursuant to the provisions of this
Escrow Agreement and will reimburse the Escrow Agent for reasonable
expenses, including reasonable attorney's fees incurred in connection
with the negotiations, drafting and performance of such services.
Except as otherwise noted, this fee covers account acceptance, set up
and termination expenses; plus usual and customary related
administrative services such as safekeeping, investment and payment of
funds specified herein or in the exhibits attached. Activities
requiring excessive administrator time or out-of-pocket expenses such
as optional substitution of collateral or securities shall be deemed
extraordinary expenses for which related costs, transaction charges,
and additional fees will be billed at Escrow Agent's standard charges
for such items. A fee schedule has been provided to all parties to this
Escrow.
6.8 The parties warrant to the Escrow Agent that there are no Federal,
State or local tax liability or filing requirements whatsoever
concerning the Escrow Agent's actions contemplated hereunder and
warrant and represent to the Escrow Agent that the Escrow Agent has no
duty to withhold or file any report of any tax liability under any
Federal of State income tax, local or State property tax, local or
State sales or use taxes, or any other tax by any taxing authority. The
parties hereto agree to jointly and severally indemnify the Escrow
Agent fully for any tax liability, penalties or interest incurred by
the Escrow Agent arising hereunder and agree to pay in full any such
tax liability together with penalty and interest if any tax liability
is ultimately assessed against the Escrow Agent for any reason as a
result of its action hereunder (except for the Escrow Agent's
individual income tax liability arising from its income fees).
6.9 The Escrow Agent shall have no liability for loss arising from any
cause beyond its control, including, but not limited to, the following:
(a) the act, failure or neglect of any agent or correspondent selected
by the Escrow Agent or the parties hereto; (b) any delay, error,
omission or default connected with the remittance of funds; (c) any
delay, error, omission or default of any mail, telegraph, cable or
wireless agency or operator; (d) the acts or edicts of any government
or governmental agency or other group or entity exercising governmental
powers.
6.10 This Escrow Agreement shall be governed by and construed in accordance
with the laws of the State of Florida. The parties hereto expressly
waive such duties and liabilities, it being their intent to create
solely an agency relationship and hold the Escrow Agent liable only in
the event of its gross negligence or willful misconduct in order to
obtain the lower fee schedule rates as specifically negotiated with the
Escrow Agent.
7. NOTICES:
7.1 All notices, demands, requests or payments provided for or given
pursuant to this Escrow must be in writing or facsimile. All such
notices shall be deemed to have been properly given or served by
personal delivery or by depositing the same in the United States mail
addressed to the person entitled to receive such notice at the address
set forth below.
To the Company:
Sally A. Fonner, President
Win or Lose Acquisition Corporation
1612 North Osceola
Clearwater, Florida 33755
To the Escrow Agent:
___________________ Bank, N.A.
Corporate Trust/Agency Administration
7.2 All notices shall be effective when received.
Approved and accepted by the Parties this ________ day of December, 2000.
Win or Lose Acquisition Corporation _________________ Bank, N.A.
By: By:
---------------------------- -----------------------------
Sally A. Fonner, President (Name and Title of Signatory)
