ESCROW
AGREEMENT
This Agreement
is dated as of the 31 st day of August, 2009 among Mesa Energy Holdings,
Inc., a Delaware corporation (the "Company"), the subscribers
listed on Schedule I hereto (“Subscribers”), and
Grushko & Mittman, P.C. (the "Escrow Agent"):
WITNESSETH
:
WHEREAS, the
Company and Subscribers have entered into a Subscription Agreement
calling for the sale by the Company to the Subscribers of secured
convertible Notes for an aggregate purchase price of $750,000;
and
WHEREAS, the
parties hereto require the Company to deliver the Notes against
payment therefor, with such Notes and the Escrowed Funds to be
delivered to the Escrow Agent, along with the other documents,
instruments and payments hereinafter described, to be held in
escrow and released by the Escrow Agent in accordance with the
terms and conditions of this Agreement; and
WHEREAS, the
Escrow Agent is willing to serve as escrow agent pursuant to the
terms and conditions of this Agreement;
NOW THEREFORE,
the parties agree as follows:
ARTICLE I
INTERPRETATION
1.1.
Definitions
. Capitalized terms used and not otherwise defined
herein that are defined in the Subscription Agreement shall have
the meanings given to such terms in the Subscription
Agreement. Whenever used in this Agreement, the
following terms shall have the following respective
meanings:
§
"Agreement"
means this Agreement and all amendments made hereto and thereto by
written agreement between the parties;
§
“Closing
Date” shall have the meaning set forth in Section 1 of the
Subscription Agreement;
§
"Escrowed
Payment" means an aggregate cash payment of $750,000 which is
the Purchase Price;
§
“Guaranty”
shall have the meaning set forth in Section 3 of the Subscription
Agreement;
§
“Legal
Opinion” means the original signed legal opinion referred to
in Section 6 of the Subscription Agreement;
§
“Note”
shall have the meaning set forth in the second recital to the
Subscription Agreement;
§
“Principal
Amount” shall mean an aggregate of $750,000;
§
“Security
Agreement” shall have the meaning set forth in Section 3 of
the Subscription Agreement;
§
“Subscriber
Legal Fees” shall have the meaning set forth in Section 8(b)
of the Subscription Agreement;
§
"Subscription
Agreement" means the Subscription Agreement (and the exhibits and
schedules thereto) entered into or to be entered into by the
Company and Subscribers in reference to the sale and purchase of
the Notes;
§
“Working
Interest Documents” shall have the meaning set forth in
Section 2 of the Subscription Agreement:
§
“Working
Interest Security Documents” shall have the meaning set forth
in Section 3 of the Subscription Agreement;
§
Collectively,
Legal Opinion, Notes, Security Agreement, Guaranty, Working
Interest Documents, Working Interest Security Documents, the
executed Subscription Agreement and Subscriber Legal Fees are
referred to as "Company Documents"; and
§
Collectively,
the Escrowed Payment and the Subscribers executed Subscription
Agreements and Security Agreement are referred to as
"Subscriber Documents".
1.2.
Entire Agreement . This Agreement along with the
Company Documents and the Subscriber Documents constitute the
entire agreement between the parties hereto pertaining to the
Company Documents and Subscriber Documents and supersedes all prior
agreements, understandings, negotiations and discussions, whether
oral or written, of the parties. There are no
warranties, representations and other agreements made by the
parties in connection with the subject matter hereof, except as
specifically set forth in this Agreement, the Company Documents and
the Subscriber Documents.
1.3.
Extended Meanings . In this Agreement words
importing the singular number include the plural and vice versa;
words importing the masculine gender include the feminine and
neuter genders. The word "person" includes an
individual, body corporate, partnership, trustee or trust or
unincorporated association, executor, administrator or legal
representative.
1.4.
Waivers and Amendments . This Agreement may be
amended, modified, superseded, cancelled, renewed or extended, and
the terms and conditions hereof may be waived, only by a written
instrument signed by all parties, or, in the case of a waiver, by
the party waiving compliance. Except as expressly stated
herein, no delay on the part of any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof, nor
shall any waiver on the part of any party of any right, power or
privilege hereunder preclude any other or future exercise of any
other right, power or privilege hereunder.
1.5.
Headings . The division of this Agreement into
articles, sections, subsections and paragraphs and the insertion of
headings are for convenience of reference only and shall not affect
the construction or interpretation of this Agreement.
1.6.
Law Governing this Agreement . This Agreement
shall be governed by and construed in accordance with the laws of
the State of New York without regard to conflicts of laws
principles that would result in the application of the substantive
laws of another jurisdiction. Any action brought by
either party against the other concerning the transactions
contemplated by this Agreement shall be brought only in the state
courts of New York or in the federal courts loca