Exhibit 10.8
ESCROW
AGREEMENT
This ESCROW AGREEMENT (this " Agreement ") made as of
October 6, 2009 by and among Zoom Technologies, Inc.,(the "
Issuer "), Global Hunters Securities, LLC (the "
Placement Agent "), whose addresses and other information
appear on the Information Sheet (attached hereto as "Exhibit
A" ) attached to this Agreement, and Continental Stock Transfer
& Trust Company, 17 Battery Place, 8 th Floor, New
York, NY 10004 (the " Escrow Agent ").
WITNESSETH:
WHEREAS, the Issuer proposes to sell up to $5,032,304 (the "
Warrant Escrowed Amount ") of Series B Warrants, (the
" Securities ") as part of an offering of Common Stock and
Warrants pursuant to the Purchase Agreement (as defined below) to
investors (the subscribers of the Securities pursuant to the
Purchase Agreement are hereinafter referred to as "
Investors "), in a private offering to accredited investors
on a "best efforts, basis through the Placement Agent (the "
Offering ");
WHEREAS, the Issuer and the Placement Agent propose to establish
an escrow account (the " Warrant Escrow Account "),
to which the subscription for payment of the Series B Warrants,
which monies are received by the Escrow Agent from Investors, the
Placement Agent, or its counsel, Sichenzia Ross Friedman &
Ference LLP, at the closing of the Offering in connection with such
private offering are to be credited, and the Escrow Agent is
willing to establish the Warrant Escrow Account on the terms and
subject to the conditions hereinafter set forth; and
WHEREAS, the Escrow Agent has agreed to establish a special bank
account at J.P. Morgan Chase Bank (the " Bank ") into which
the Warrant Escrow Amount, which are received by the Escrow Agent
and credited to the Warrant Escrow Account, are to be
deposited.
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the parties hereto hereby agree as
follows:
1.
Definitions . Each capitalized term not otherwise defined in
this Agreement shall have the meaning set forth for such term in
that certain Securities Purchase Agreement, dated on or about
October 13, 2009 (the " Purchase Agreement ") which is
attached to this Agreement as Exhibit B and is incorporated
by reference herein and made a part hereof.
2. Establishment
of the Bank Account .
2.1 The
Escrow Agent shall establish an interest-bearing bank account at
the branch of Bank selected by the Escrow Agent, and bearing the
designation set forth on Exhibit A (heretofore defined as the "
Bank Account "). The purpose of the Bank Account is for (a)
the deposit of the Warrant Escrow Amount (checks or wire transfers)
which are received by the Placement Agent or Sichenzia Ross
Friedman & Ference LLP from Investors, or the Investors, and
are delivered to the Escrow Agent at the closing of the Offering,
(b) the holding of the Warrant Escrow Amount from the closing of
the Offering through the period set forth in Section 4 hereof, and
(c) the disbursement of collected funds, all as described
herein.
2.2 On
or before the date of the initial deposit in the Bank Account
pursuant to this Agreement, the Placement Agent shall notify the
Escrow Agent in writing of the date of the closing of the Offering
(the " Effective Date "), and the Escrow Agent shall not be
required to accept any amounts for credit to the Warrant Escrow
Account or for deposit in the Bank Account prior to its receipt of
such notification.
2.3
The Initial " Escrow Period ," which shall be deemed to
commence on the Effective Date, shall end on the date that is 120
days from the Effective Date unless (i) prior to such date on which
disbursement is made pursuant to Section 4.1 hereof, or (ii)
extended by the Placement Agent pursuant to Section 4.2 hereof. The
Offering Period shall be extended pursuant to Section 4.2 hereof
(an " Extension Period ") unless the Escrow Agent shall have
received written notice from the Placement Agent instructing refund
of the Escrow Amount pursuant to Section 4.2. The Extension Period,
which shall be deemed to commence on the next calendar day
following the expiration of the initial Escrow Period, shall
consist of 60 calendar days. The last day of the Escrow Period, or
the last day of the Extension Period (if the Escrow Agent has
received written notice thereof as herein above provided), is
referred to herein as the " Termination Date ".
3. Deposits to the
Bank Account .
3.1 The
Placement Agent or Sichenzia Ross Friedman & Ference LLP shall
deliver to the Escrow Agent all monies which it receives from the
Investors with respect to the Series B Warrants, which monies shall
be in the form of checks or wire transfers, provided however that
"Cashiers" checks and "Money Orders" must be in amounts greater
than $10,000; Cashiers checks or Money Orders in amounts less than
$10,000 shall be rejected by the Escrow Agent. Upon the Escrow
Agent's receipt of such monies, they shall be credited to the
Warrant Escrow Account. All checks delivered to the Escrow Agent
shall be made payable to "CST&T Zoom Technologies Escrow
Account." Any check payable other than to the Escrow Agent as
required hereby shall be returned to the sender, or if the Escrow
Agent has insufficient information to do so, then to the Placement
Agent (together with any Subscription Information, as defined below
or other documents delivered therewith) by noon of the next
business day following receipt of such check by the Escrow Agent,
and such check shall be deemed not to have been delivered to the
Escrow Agent pursuant to the terms of this Agreement.
3.2
Promptly after receiving monies for the purchase of the Series B
Warrants as described in Section 3.1, the Escrow Agent shall
deposit the same into the Bank Account. Amounts of monies so
deposited are hereinafter referred to as " Escrow Amounts ".
The Escrow A