ESCROW AGREEMENT
THIS ESCROW AGREEMENT is made as of the 14th day of December, 2000 by
and among Latin American Casinos, Inc., a corporation organized under the laws
of the State of Delaware (hereinafter referred to as the "COMPANY"), and the
investors set forth on Schedule A annexed to the Purchase Agreement (defined
below) (hereinafter collectively referred to as the "INVESTORS"), and The
Goldstein Law Group, P.C. (hereinafter the "ESCROW AGENT").
W I T N E S E T H:
WHEREAS, pursuant to the Convertible Debenture Purchase Agreement dated
as of December 14, 2000 (the "PURCHASE AGREEMENT"), the Investors will be
purchasing Debentures (as defined in the Purchase Agreement) (hereinafter
referred to as the "SECURITIES") for the Purchase Price as set forth in the
Purchase Agreement; and
WHEREAS, the parties have requested that the Escrow Agent hold the
funds of the Investors in escrow until the Escrow Agent has received the
original Securities. The Escrow Agent will then immediately wire transfer or
otherwise deliver at the Company's direction immediately available funds to the
Company or the Company's account and arrange for delivery of the Securities to
the Investors as per each Investor's written instructions.
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:
ARTICLE I
TERMS OF THE ESCROW
1.1 Upon Escrow Agent's receipt into its attorney trustee account
of the Purchase Price from each Investor for the Securities to be purchased on
the Closing Date pursuant to the terms and conditions set forth in the Purchase
Agreement, it shall notify the Company, of the amount of funds it has received
into its account.
1.2 The Company, upon receipt of said notice and acceptance of the
Purchase Agreement (including all Exhibits annexed thereto) by both parties, as
evidenced by the Company, and the Investors' execution thereof, shall deliver to
the Escrow Agent the original Securities being purchased by each Investor in
connection with the Closing Date.
1.3 Once Escrow Agent receives the original Securities he shall
immediately wire that amount of funds necessary to purchase such Securities per
the written instructions of the Company. Once the funds (as set forth above)
have been received per the Company's instructions, the Escrow Agent shall then
arrange to have the Securities delivered as per instructions from each Investor.
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ARTICLE 2
MISCELLANEOUS
2.1 This Agreement may be altered or amended only with the consent
of all of the parties hereto. Should any party attempt to change this Agreement
in a manner that in the Escrow Agent's discretion shall be undesirable, or at
the sole option of the Escrow Agent, the Escrow Agent may resign as Escrow Agent
by notifying all parties in writing in writing. The Company and the Investors
may remove the Escrow Agent as escrow agent by serving a written notice signed
by all of such parties removing Escrow Agent as the escrow agent in this
transaction. In the case of the Escrow Agent's resignation or removal pursuant
to the foregoing, his only duty, until receipt of notice from the Company and
the Investors or its agent that a successor escrow agent shall have been
appointed, shall be to hold and preserve the Securities and/or funds. Upon
receipt by the Escrow Agent of said notice from the Company and the Investors of
the appointment of a successor escrow agent, the name of a successor escrow
account and a direction to transfer the Securities and/or funds, the Escrow
Agent shall promptly thereafter transfer all of the Securities and/or funds held
in escrow to said successor escrow agent. The Escrow Agent is authorized to
disregard any notices, requests, instructions or demands received by it from the
Company or the Investor after notice of resignation or removal shall have been
given, unless the same shall be the aforementioned notice from the Company and
the Investors to transfer the Securities and funds to a successor escrow agent
or to return same to the respective parties.
2.2 The Escrow Agent shall be reimbursed by all parties hereto
for any reasonable expenses incurred in the event there is a conflict between
the parties and the Escrow Agent shall deem it necessary to retain counsel.
2.3 The Escrow Agent shall not be liable for any action taken or
omitted by him in good faith in accordance with the advice of the Escrow Agent's
counsel; and in no event shall the Escrow Agent be liable or responsible except
for the Escrow Agent's own gross negligence or willful misconduct.
2.4 The Company, and the Investors warrant to and agree with the
Escrow Agent that, unless otherwise expressly set forth in this Agreement:
(i) there is no security interest in the Securities or
any part thereof;
(ii) no financing statement under the Uniform
Commercial Code is on file in any jurisdiction claiming a security
interest or in describing (whether specifically or generally) the
Securities or any part thereof; and
(iii) the Escrow Agent shall have no responsibility
at any time to ascertain whether or not any security interest exists in
the Securities or any part thereof or to file any financing statement
under the Uniform Commercial Code with respect to the Securities or any
part thereof.
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2.5 The Escrow Agent has no liability hereunder to either party
other than to hold the Securities and funds and to deliver them under the terms
hereof. Each party hereto agrees to indemnify and hold harmless the Escrow Agent
from and with respect to any suits, claims, actions or liabilities arising in
any way out of this transaction including the obligation to defend any legal
action brought which in any way arises out of or is related to this Escrow
Agreement.
2.6 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 any extension of
the time for performance of any other obligation or act.
2.7 All notices, demands, requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing and, unless
otherwise specified herein, shall be (i) personally served, (ii) deposited in
the mail, registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram, or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or permitted to be
given hereunder shall be deemed effective (a) upon hand delivery or delivery by
facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a Business
Day between the hours of 9:00 a.m. and 5:00 p.m. where such notice is to be
received), or the first Business Day following such delivery (if delivered other
than on a Business Day between the hours of 9:00 a.m. and 5:00 p.m. where such
notice is to be received), (b) on the second Business Day following the date of
mailing by reputable courier service, fully prepaid, addressed to such address,
or upon actual receipt of such mailing, whichever shall first occur, or (c) five
calendar days after sent by regular mail. The addresses for such communications
shall be:
If to the Company:
Latin American Casinos, Inc.
2000 NE 164th Street
North Miami Beach, FL 33162
Attention: President
Facsimile: (305) 945-0288
Telephone: (305) 945-9300
with a copy to:
The Goldstein Law Group, P.C.
65 Broadway, 10th Floor
New York, NY 10006
Attention: Jeffrey M. Stein
Telephone: (212) 809-4220
Facsimile: (212) 809-4228
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If to the Investors at their respective address set forth on
Schedule A annexed to the Purchase Agreement.
If to the Escrow Agent:
The Goldstein Law Group, P.C.
65 Broadway, 10th Floor
New York, NY 10006
Attention: Jeffrey M. Stein
Telephone: (212) 809-4220
Facsimile: (212) 809-4228
Either party hereto may from time to time change its address or
facsimile number for notices under this Section 2.7 by giving at least ten
calendar days' prior written notice of such changed address or facsimile number
to the other party hereto.
2.8 This Agreement shall be binding upon and shall inure to the
benefit of the permitted successors and assigns of the parties hereto.
2.9 This Agreement 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 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.
2.10 Whenever required by the context of this Agreement, the
singular shall include the plural and masculine shall include the feminine. This
Agreement shall not be construed as if it had been prepared by one of the
parties, but rather as if both parties had prepared the same. Unless otherwise
indicated, all references to Articles are to this Agreement.
2.11 The Investors acknowledge and confirm that they are not being
represented in a legal capacity by The Goldstein Law Group, P.C. and it has had
the opportunity to consult with its own legal advisors prior to the signing of
this Agreement, and acknowledges that The Goldstein Law Group, P.C. is
representing the Company in a legal capacity and agrees to The Goldstein Law
Group, P.C. to serve in such capacity and serve as Escrow Agent.
2.12 The parties hereto expressly agree that this Agreement shall
be exclusively governed by, interpreted under and construed and enforced in
accordance with the laws of the State of New York. Each of the parties consents
to the jurisdiction of the federal courts for the Southern District of the State
of New York, in connection with any dispute arising under this Agreement and
hereby waives, to the maximum extent permitted by law, any objection, including
any objection based on FORUM NON CONVENIENS, to the bringing of any such
proceeding in such jurisdictions. Each party hereby agrees that if another party
to this Agreement obtains a judgment against it in such a proceeding, the party
which obtained such judgment may enforce same by summary judgment in the courts
of any state or country having jurisdiction over the party against whom such
judgment was obtained, and each party hereby waives any defenses available to it
under local law and agrees to the enforcement of such a judgment. Each party to
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this Agreement irrevocably consents to the service of process in any such
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, to such party at its address set forth herein. Nothing herein
shall affect the right of any party to serve process in any other manner
permitted by law.
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed as of the date first written on the first page of this
Agreement.
LATIN AMERICAN CASINOS, INC.
By: __________________________
Name: Jeffrey Felder
Title: President
INVESTORS:
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The Goldstein Law Group, P.C.,
Escrow Agent
By: __________________________
Jeffrey M. Stein
