SECOND AMENDED AND RESTATED ESCROW AGREEMENT
Exhibit 4.3
SECOND AMENDED AND RESTATED ESCROW AGREEMENT
THIS
SECOND AMENDED AND RESTATED ESCROW AGREEMENT (this
“Agreement”) is made this 27th day of
January, 2006, by and between E Energy ▇▇▇▇▇, LLC a Nebraska limited liability company (“E Energy
▇▇▇▇▇”) and Union Bank & Trust Company as escrow agent (the “Escrow Agent”).
W I T N E S S E T H:
WHEREAS, the parties previously entered into an Escrow Agreement dated October 14, 2005 (the
“Escrow Agreement”) in connection with the Company’s offering made pursuant to a federal
registration under the provisions of the Securities Act of 1933, as amended (the “Offering”);
WHEREAS, E Energy ▇▇▇▇▇ has amended its federal registration statement relating to the
Offering and the parties desire to amend and restate the Escrow Agreement to reflect the amendments
to the federal registration statement;
WHEREAS, E Energy ▇▇▇▇▇ proposes to offer a minimum of 1,990 and a maximum of 5,810 of its
Membership Units (the “Units”) at a price of $10,000 per Unit, in minimum blocks of two (2) Units
in an offering registered with the Securities and Exchange Commission and in the states of
Nebraska, Iowa, Kansas, Missouri, Wisconsin, South Dakota and Florida, and possibly offered in
other states pursuant to state securities registration exemptions and under the provisions of the
Securities Act of 1933, as amended;
WHEREAS, E Energy ▇▇▇▇▇ will file a registration statement to register the Units with the
Securities and Exchange Commission, the States of Nebraska, Iowa, Kansas, Missouri, Wisconsin,
South Dakota and Florida, and possibly other states;
WHEREAS, E Energy ▇▇▇▇▇ will allow investors in the Offering to deliver the purchase price of
the subscribed Units in installments; and
WHEREAS, E Energy ▇▇▇▇▇ desires to comply with the requirements of federal and state
securities laws and regulations, and desires to protect the investors in the Offering by providing,
under the terms and conditions herein set forth, for the return to subscribers of the money which
they may pay on account of purchases of Units in the Offering if the Minimum Escrow Deposit
(hereinafter defined) is not deposited with the Escrow Agent.
NOW, THEREFORE, in consideration of the mutual covenants herein contained and for other good
and valuable consideration, the receipt and sufficiency of which is acknowledged, the parties agree
as follows:
1. Acceptance of Appointment. Union Bank & Trust Company hereby agrees to act as
Escrow Agent under this Agreement. The Escrow Agent shall have no duty to enforce any provision
hereof requiring performance by any other party hereunder.
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2. Establishment of Escrow Account. An escrow account (the “Escrow Account”) is
hereby established with the Escrow Agent for the benefit of the investors in the Offering. Except
as specifically provided in this Agreement, the Escrow Account shall be created and maintained
subject to the customary rules and regulations of the Escrow Agent pertaining to such accounts.
3. Ownership of Escrow Account. Until such time as the funds deposited in the Escrow
Account (the “Deposited Funds”) shall equal the Minimum Escrow Deposit (as hereinafter defined),
all funds deposited in the Escrow Account by E Energy ▇▇▇▇▇ shall not become the property of E
Energy ▇▇▇▇▇ or be subject to the debts of E Energy ▇▇▇▇▇ or any other person but shall be held by
the Escrow Agent solely for the benefit of the investors who have purchased Units in the Offering.
4. Deposit of Proceeds. All proceeds from sales of Units in the Offering shall be
delivered by E Energy ▇▇▇▇▇ to the Escrow Agent, within forty-eight hours of the receipt thereof
from investors, endorsed (if appropriate) to the order of the Escrow Agent, together with an
appropriate written statement setting forth name, address and social security number of each person
purchasing Units, the number of Units purchased, and the amount paid by each such purchaser. Any
such proceeds deposited with the Escrow Agent in the form of uncollected checks shall be promptly
presented by the Escrow Agent for collection through customary banking and clearing house
facilities. As the proceeds of each sale are deposited with the Escrow Agent, E Energy ▇▇▇▇▇ shall
reserve the number of Units confirmed to the purchaser thereof in connection with such sale. All
such deposited proceeds are referred to herein as the “Escrow Funds”.
5. Investment of Escrow Account. The Escrow Funds shall be credited by the Escrow
Agent and recorded in the Escrow Account. The Escrow Agent shall be permitted, and is hereby
authorized to deposit, transfer, hold and invest all funds received under this Agreement, including
principal and interest, in those investments directed, in writing by E Energy ▇▇▇▇▇. The Escrow
Agent is hereby authorized to invest Escrow Funds in the Federated Treasury Obligations Money
Market Mutual Fund for temporary investment without written direction. Any interest received by
the Escrow Agent with respect to the Escrow Funds shall be paid to E Energy ▇▇▇▇▇, or the
investors, as indicated elsewhere in this Agreement .
6. Termination of Escrow. This Agreement and the Escrow created hereunder shall
be terminated as provided in paragraph 7 hereof or as of the date in calendar year 2007 (the
“Termination Date”), which is one year and one day following the date in calendar year 2006 upon
which the Securities and Exchange Commission authorizes the Offering (the “Offering’s Effective
Date”). The Company shall notify Escrow Agent of the Offering’s Effective Date within thirty (30)
days of the receipt of notice of the Offering’s Effective Date from the Securities and Exchange
Commission.
7. Disposition of Escrow Funds. The Escrow Agent shall have the following duties and
obligations under this Agreement:
A. The Escrow Agent shall send a written notice acknowledging the receipt of the
Deposited Funds every seven days to the Company.
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B. The Escrow Agent shall give the Company prompt written notice when the Deposited
Funds equal $1,990,000 (exclusive of interest). Following receipt of such notice, the
Company will advise the purchasers of Units to remit to the Escrow Agent the balance of the
purchase price within twenty (20) days. Thereafter, Escrow Agent shall give the Company
written notice acknowledging the receipt of the Deposited Funds every seven days. The
Escrow Agent shall give the Company prompt written notice when the Deposited Funds total
$19,900,000 (exclusive of interest).
C. At the time (and in the event) that: (a) the Deposited Funds shall, during the term
of this Agreement, equal $19,990,000 in subscription proceeds (exclusive of interest) (the
“Minimum Escrow Deposit”); (b) the Escrow Agent shall have received written confirmation
from the Company that the Company has obtained a written debt financing commitment for debt
financing ranging from a minimum of $23,930,000 to a maximum of $62,130,000; (c) the
Company has affirmatively elected in writing to terminate this Agreement; (d) the Escrow
Agent shall have provided to each state securities department in which the Company has
registered its securities for sale, as communicated to the Escrow Agent by the Company, an
affidavit stating that the foregoing requirements (a), (b) and (c) of this subsection 7C
have been satisfied; (d) the Company has provided the Nebraska Department of Banking and
Finance an affidavit meeting the requirements of Nebraska Securities Rule Chapter 25,
Section 3.01C; and (e) in each state in which consent is required, the state securities
commissioners have consented to release of the funds on deposit, then this Agreement shall
terminate, and the Escrow Agent shall promptly disburse the funds on deposit, including
interest, to the Company to be used in accordance with the provisions set out in the
Registration Statement. Notwithstanding any other provision of this Agreement, under no
circumstances shall the South Dakota Division of Securities be required or requested by the
Company or the Escrow Agent to (i) consent to the disbursement of Deposited Funds; or (ii)
recognize the Company’s fulfillment of its obligations pursuant to the terms of this
Agreement. The Company will deliver a copy of the Registration Statement to the Escrow
Agent upon execution of this Agreement. The Escrow Agent will have no responsibility to
examine the Registration Statement with regard to the Escrow Account or otherwise and the
Registration Statement shall contain a provision to such effect. Upon the making of such
disbursement, the Escrow Agent shall be completely discharged and released of any and all
further responsibilities hereunder.
D. In the event the Deposited Funds do not equal or exceed the Minimum Escrow Deposit
on or before the Termination Date or if the Company has not received a written debt
financing commitment as described herein on or before the Termination Date, the Escrow Agent
shall return to each of the purchasers of the Units in the Offering, as promptly as possible
after such Termination Date and on the basis of its records pertaining to the Escrow
Account: (a) the sum which each purchaser initially paid in on account of purchases of the
Units in the Offering and (b) each purchaser’s portion of the total interest earned on the
Escrow Account as of the Termination Date, (c) reduced by the transaction fees provided in
paragraph 10 hereof. Computation of any purchaser’s share of the net interest earned will
be a weighted average based on the proportion of such purchaser’s deposit in the Escrow
Account from the Offering to all such purchasers’ deposits held by the
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Escrow Agent and upon the length of time in days such deposit was held in the Escrow
Account as compared to all such deposits. All computations with respect to each purchaser’s
allocable share of net interest shall be made by the Escrow Agent, which determinations
shall be final and conclusive. Any amount paid or payable to a purchaser pursuant to this
paragraph shall be deemed to be the property of such purchaser, free and clear of any and
all claims of the Company or its agents or creditors; and the respective purchases of the
Units made and entered into in the Offering shall thereupon be deemed, ipso facto, to be
cancelled without any further liability of the purchasers or any of them to pay for the
Units purchased. At such time as the Escrow Agent shall have made all the payments called
for in this paragraph, the Escrow Agent shall be completely discharged and released of any
and all further responsibilities hereunder, and the Units reserved (as provided in paragraph
5) shall be released from such reservation, except that Escrow Agent shall be required to
prepare and issue a single IRS Form 1099 to each investor in the event that funds are
returned to investors.
8. Agreement with Escrow Agent. To induce Escrow Agent to act hereunder, it is agreed
by E Energy ▇▇▇▇▇ that:
A. The sole duty of the Escrow Agent, other than as herein specified, shall be to
receive the Escrow Funds and hold them subject to release, in accordance herewith, and the
Escrow Agent shall be under no duty to determine whether E Energy ▇▇▇▇▇ is complying with
the requirements of this Agreement in tendering to the Escrow Agent said proceeds of the
sale of said Units. The Escrow Agent may conclusively rely upon and shall be protected in
acting upon any statement, certificate, notice, request, consent, order or other document
believed by it to be genuine and to have been signed or presented by the proper party or
parties. The Escrow Agent shall have no duty or liability to verify any such statement,
certificate, notice, request, consent, order or other document, and its sole responsibility
shall be to act only as expressly set forth in this Agreement. The Escrow Agent shall be
under no obligation to institute or defend any action, suit or proceeding in connection with
this Agreement unless first indemnified to its satisfaction. The Escrow Agent may consult
counsel in respect of any question arising under this Agreement and the Escrow Agent shall
not be liable for any action taken or omitted in good faith upon advice of such counsel.
B. E Energy ▇▇▇▇▇ hereby indemnifies and holds harmless the Escrow Agent from and
against any and all loss, liability, cost, damage and expense, including, without
limitation, reasonable counsel fees, which the Escrow Agent may suffer or incur by reason of
any action, claim or proceeding brought against the Escrow Agent 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 gross negligence or willful misconduct of
the Escrow Agent.
9. Resignation and Removal of Escrow Agent Successors. The Escrow Agent may resign
upon thirty (30) days advance written notice to E Energy ▇▇▇▇▇. If a successor Escrow Agent is not
appointed within the 30-day period following such notice, Escrow Agent may petition any court of
competent jurisdiction to name a successor Escrow Agent. Any commercial banking institution or
trust company with which Escrow Agent may merge or consolidate, and any
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commercial banking institution or trust company to which Escrow Agent transfers all or
substantially all of its corporate trust business shall be the successor Escrow Agent without
further act.
10. Fees and Expenses of Escrow Agent. E Energy ▇▇▇▇▇ agrees to pay the Escrow Agent
the fees specified in the Escrow Agent’s fee schedule attached hereto as Exhibit A, in the manner
set forth therein, unless otherwise agreed to by the parties in writing. The parties further agree
that such fees shall be paid from interest on the escrow account only and not from principal. In
the event the interest on the escrow account is insufficient to satisfy the full amount of fees
payable hereunder, E Energy ▇▇▇▇▇ shall be solely responsible for the payment of such fees and the
Escrow Agent shall not seek payment of the fees from investors or apply any principal deposited by
investors in the escrow account against such fees. The fee agreed upon herein is intended as full
consideration for the Escrow Agent’s services as contemplated by this Agreement; provided,
however, that in the event the Escrow Agent renders any material service not contemplated
in this Agreement or there is any assignment of interest in the subject matter of this Agreement,
or any material modification hereof; or if any material controversy arises hereunder, or the Escrow
Agent is made a party to any litigation pertaining to this Agreement, or the subject matter hereof,
then the Escrow Agent shall be reasonably compensated for such extraordinary services and
reimbursed for all costs and expenses, including reasonable attorney’s fees, occasioned by any
delay, controversy, litigation or event, and the same shall be recoverable from E Energy ▇▇▇▇▇, but
not from the escrow account.
11. Notices. All notices, requests, demands, and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of
service if served personally on the party to whom notice is to be given, (b) on the day of
transmission if sent by facsimile transmission to the facsimile number given below, and telephonic
confirmation of receipt is obtained promptly after completion of transmission, (c) on the next day
on which such deliveries are made in Adams, Nebraska, when delivery is to Federal Express or
similar overnight courier or the Express Mail service maintained by the United States Postal
Service, or (d) on the fifth day after mailing, if mailed to the party to whom notice is to be
given, by first class mail, registered or certified, postage prepaid, and properly addressed,
return receipt requested, to the party as follows:
If to Escrow Agent:
Union Bank & Trust Company
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
P.O. Box 82535
Lincoln, Nebraska 68501-2535
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
P.O. Box 82535
Lincoln, Nebraska 68501-2535
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
Phone: ▇▇▇-▇▇▇-▇▇▇▇
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If to E Energy ▇▇▇▇▇:
E Energy ▇▇▇▇▇ Adams, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
Fax: ▇▇▇-▇▇▇-▇▇▇▇
▇.▇. ▇▇▇ ▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
Fax: ▇▇▇-▇▇▇-▇▇▇▇
with a required copy to:
Brown, Winick, Graves, Gross, ▇▇▇▇▇▇▇▇▇▇▇ and Schoenebaum, P.L.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
12. Governing Law. This Agreement shall be construed, performed, and enforced in
accordance with, and governed by, the internal laws of the State of Nebraska, without giving effect
to the principles of conflict of laws thereof.
13. Successors and Assigns. Except as otherwise provided in this Agreement, no party
hereto shall assign this Agreement or any rights or obligations hereunder without the prior written
consent to the other parties hereto and any such attempted assignment without such prior written
consent shall be void and of no force and effect. This Agreement shall inure to the benefit of and
shall be binding upon the successors and permitted assigns of the parties hereto.
14. Severability. In the event that any part of this Agreement is declared by any
court or other judicial or administrative body to be null, void, or unenforceable, said provision
shall survive to the extent it is not so declared, and all of the other provisions of this
Agreement shall remain in full force and effect.
15. Further Assurances. Each of the parties shall execute such documents and other
papers and take such further actions, as may be reasonably required or desirable to carry out the
provisions hereof and the transactions contemplated hereby.
16. Amendments. This Agreement may be amended or modified, and any of the terms,
covenants, representations, warranties, or conditions hereof may be waived, only by a written
instrument executed by the parties hereto, or in the case of a waiver, by the party waiving
compliance. Any waiver by any party of any condition, or of the breach of any provision, term,
covenant, representation, or warranty contained in the Agreement, in any one or more instances,
shall not be deemed to be nor construed as further or continuing waiver of any such conditions, or
of the breach of any other provision, term, covenant, representation, or warranty of this
Agreement.
17. Entire Agreement. This Agreement contains the entire understanding among the
parties hereto with respect to the escrow contemplated hereby and supersedes and replaces all prior
and contemporaneous agreements and understandings, oral or written, with regard to such escrow.
18. Section Headings.
The section headings in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.
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19. Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have hereunto affixed their signatures as of the day
and year first written above.
| E ENERGY ▇▇▇▇▇: | ESCROW AGENT | |||||||||
| E ENERGY ▇▇▇▇▇, LLC | UNION BANK & TRUST COMPANY | |||||||||
By:
|
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ | |||||||
| ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President | ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ | |||||||||
| Title: Assistant Vice
President and Trust Officer |
||||||||||
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Exhibit A
UNION BANK AND TRUST COMPANY
Escrow Agent Fee Schedule
Escrow Agent Fee Schedule
Escrow Agreement
E Energy ▇▇▇▇▇ LLC
E Energy ▇▇▇▇▇ LLC
Administration |
$ | 500.00 | ||
Transaction Fees
|
||||
Subscriber |
$ | 5.00 | ||
Disbursement/Each |
$ | 5.00 | ||
1099 Filing |
$ | 100.00 | ||
Subscriber/Filing |
$ | 5.00 |
All out of pocket costs and expenses, including postage, supplies, long distance telephone charges,
wires and reasonable attorney’s fees will be in addition hereto.
We reserve the right to revise fees, including establishing new minimums, as necessitated by
changing economic conditions.
All fees are charged in arrears and are quoted on an annualized basis; however we reserve the right
to ▇▇▇▇ in advance, or on a more frequent basis.
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