Escrow Agreement dated April 26, 2004 among the registrant, Wilmington Trust
      Company and Strasbourger Pearson Tulcin Wolff Incorporated


    

       

      Exhibit
        10.6

       

      ESCROW
        AGREEMENT

       

      ESCROW
        AGREEMENT dated as of this 26th
        day of
        April, 2004 by and among Magnetech Integrated Services Corp., an Indiana
        corporation (the “Company”), Wilmington Trust Company, a financial institution
        chartered under the laws of the State of Delaware (the “Agent”),
        and
        Strasbourger Pearson Tulcin Wolff Inc., a New York corporation (“Strasbourger”).

       

      W
        I T
        N E S S E T H:

       

      WHEREAS,
        the Company is offering 16,000,000 shares of Common Stock (“MISC
        Shares”)
        at
        $0.20 per MISC Share (inclusive of the $750,000 of Series A Convertible
        Redeemable Preferred Stock sold in the pre-bridge financing by the Company’s
        subsidiary Magnetech Industrial Services, Inc., which closed on February
        26,
        2004, and which automatically convert into 4,750,000 MISC Shares of this
        Offering (as such term is defined below), (the “Offering”)
        through Strasbourger; and

       

      WHEREAS:

       

      (a) The
        Offering will commence immediately and will continue until the earlier to
        occur
        of (i) the sale of the maximum number of MISC Shares that comprise the Offering
        and (ii) August ___, 2004, unless extended by up to 45 days by the Company
        and
        Strasbourger (the “Offering
        Period”);

       

      (b) Once
        the
        Offering has been sold, the Company and Strasbourger may conduct one or more
        closings (each a “Closing”)
        on the
        sale of such MISC Shares;

       

      (c) Tendered
        subscriptions for all MISC Shares shall be subject to acceptance by the Company,
        which subscriptions may be reduced in the sole discretion of the Company
        or
        rejected for any reason in the sole discretion of the Company; 

       

      (d) Proceeds
        received upon the subscription of the MISC Shares shall be held in escrow
        by the
        Agent pending the Closing on the MISC Shares, and disbursed upon the Closing;
        and

       

      (e) If
        the
        Offering is not sold prior to the end of the Offering Period and there is
        no
        Closing, the Offering will be terminated and all funds received from Purchasers
        will be returned, without accrued interest and without any deduction. The
        day
        that the Offering Period terminates is hereinafter referred to as the
“Termination
        Date.”

       

      NOW,
        THEREFORE, in consideration of the mutual promises herein contained and
        intending to be legally bound, the parties hereby agree as follows:

       

      1. Appointment
        of Agent.
        The
        Company hereby appoints Wilmington Trust Company as escrow agent in accordance
        with the terms and conditions set forth herein, and Wilmington Trust Company
        hereby accepts such appointment.


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

      2. Delivery
        of Subscription Proceeds.
        All
        checks, drafts, or other instruments received from subscribers as payment
        for
        the Units will be delivered by the Company to the Agent, made payable to
        “Wilmington Trust Company, as Escrow Agent for Magnetech Integrated Services
        Corp.” Prior to Closing or earlier termination of the Offering, the Company will
        provide the Agent with a chart setting forth, as to each subscriber, his
        name,
        address, social security number or employer identification number, number
        of
        MISC Shares subscribed for, and the amount paid in connection with such
        subscription. The Agent is hereby empowered on behalf of the Company to endorse
        and collect all checks, drafts, wire funds transfers, promissory notes or
        other
        instruments received on account of subscriptions for MISC Shares.

       

      3. Agent
        to Hold and Disburse Funds.
        The
        Agent will hold in a special account established for the benefit of the Company
        and disburse all funds received by it pursuant to the terms of this Escrow
        Agreement, as follows:

       

      3.1 All
        funds
        received by the Agent pursuant to the terms of this Escrow Agreement shall
        be
        held in a non-interest bearing account with the Agent and may be invested
        in The
        Wilmington U.S. Government Portfolio fund. It is understood that all checks
        received by the Agent are subject to clearance time, and the funds represented
        thereby cannot be drawn until such time as the same constitutes good and
        collected funds.

       

      3.2 In
        the
        event that prior to the Termination Date the Agent has received funds (and
        such
        funds are cleared within three days after the Termination Date) or other
        instruments in payment for subscriptions from the sale of the Offering, the
        Agent will, on the date of each Closing (the “Closing
        Date”),
        pursuant to (a) written instructions signed by the Company and Strasbourger
        and
        (b) written confirmation from counsel to either the Company or Strasbourger
        that
        all conditions for the release of the funds have been met, pay to the Company,
        Strasbourger and/or to any other person designated in such instructions,
        the
        proceeds received by the Agent from the sale of such Units (less the funds
        the
        Company is obligated to pay as a fee to the Agent pursuant to Section 7
        hereof, unless otherwise paid by the Company).

       

      3.3 In
        the
        event that a Closing does not occur prior to the end of the Offering Period
        or
        if no written instructions are received by the Agent from the Company and
        Strasbourger relative to funds received by the Agent from one or more
        subscribers to the Offering within three business days after the Termination
        Date, the Agent will return the escrowed funds to each Subscriber without
        deduction and without interest by check mailed to the address set forth in
        the
        chart delivered pursuant to Section 2. The Agent shall assume the Offering
        Period terminates on August ___, 2004 unless notified otherwise in writing
        by
        the Company or Strasbourger.

       

      4. Exculpation
        and Indemnification of Agent.

       

      4.1 The
        Agent
        shall have no duties or responsibilities other than those expressly set forth
        herein. The Agent shall have no duty to enforce any obligation of any person
        to
        make any payment or delivery, or to direct or cause any payment or delivery
        to
        be made, or to enforce any obligation of any person to perform any other
        act.
        The Agent shall be under no liability to the other parties hereto or to anyone
        else by reason of any failure on the part of any party hereto or any maker,
        guarantor, endorser or other signatory of any document or any other person
        to
        perform such person's obligations under any such document. Except for amendments
        to this Agreement referred to below, and except for instructions given to
        the
        Agent by the Company and Strasbourger relating 


      
        
           

        

        
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      to
        the
        escrow deposit under this Agreement, the Agent shall not be obligated to
        recognize any agreement between any and all of the persons referred to herein,
        notwithstanding that references thereto may be made herein and whether or
        not it
        has knowledge thereof.

       

      4.2 The
        Agent
        shall not be liable to the Company or to anyone else for any action taken
        or
        omitted by it, or any action suffered by it to be taken or omitted, in good
        faith and in the exercise of its own best judgment. The Agent may rely
        conclusively and shall be protected in acting upon any order, notice, demand,
        certificate, opinion or advice of counsel (including counsel chosen by the
        Agent), statement, instrument, report or other paper or document (not only
        as to
        its due execution and the validity and effectiveness of its provisions, but
        also
        as to the truth and acceptability of any information therein contained),
        which
        is believed by the Agent to be genuine and to be signed or presented by the
        proper person or persons. The Agent shall not be bound by any notice or demand,
        or any waiver, modification, termination or rescission of this Agreement
        or any
        of the terms thereof, unless evidenced by a writing delivered to the Agent
        signed by the proper party or parties and, if the duties or rights of the
        Agent
        are affected, unless it shall give its prior written consent thereto. In
        the
        event the Agent receives conflicting instructions hereunder, the Agent shall
        be
        fully protected in refraining from acting until such conflict is resolved
        to the
        satisfaction of the Agent.

       

      4.3 The
        Agent
        shall not be responsible for the sufficiency or accuracy of the form of,
        or the
        execution, validity, value or genuineness of, any document or property received,
        held or delivered by it hereunder, or of any signature or endorsement thereon,
        or for any lack of endorsement thereon, or for any description therein; nor
        shall the Agent be responsible or liable to the other parties hereto or to
        anyone else in any respect on account of the identity, authority or rights
        of
        the persons executing or delivering or purporting to execute or deliver any
        document or property of this Agreement. The Agent shall have no responsibility
        with respect to the use or application of any funds or other property paid
        or
        delivered by the Agent pursuant to the provisions hereof. The Agent shall
        not be
        liable to the Company or to anyone else for any loss which may be incurred
        by
        reason of any investment of any monies which it holds hereunder provided
        the
        Agent has complied with the provisions of Section 3.1 hereunder.

       

      4.4 The
        Agent
        shall have the right to assume in the absence of written notice to the contrary
        from the proper person or persons that a fact or an event by reason of which
        an
        action would or might be taken by the Agent does not exist or has not occurred,
        without incurring liability to the other parties hereto or to anyone else
        for
        any action taken or omitted, or any action suffered by it to be taken or
        omitted, in good faith and in the exercise of its own best judgment, in reliance
        upon such assumption. Agent shall be entitled to consult with legal counsel
        in
        the event that a question or dispute arises with regard to the construction
        of
        any of the provisions hereof, and shall incur no liability and shall be fully
        protected in acting in accordance with the advice or opinion of such
        counsel.

       

      Agent
        shall not be required to take any action which, in the Agent’s sole and absolute
        judgment, could involve it in expense or liability in excess of its fees
        and
        reimbursable expenses hereunder unless furnished with security and indemnity
        which it deems, in its sole and absolute discretion, to be
        satisfactory.

       

      4.5 To
        the
        extent that the Agent becomes liable for the payment of taxes, including
        withholding taxes, in respect of income derived from the investment of funds
        held hereunder or any 


      
        
           

        

        
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      payment
        made hereunder, the Agent may pay such taxes. The Agent may withhold from
        any
        payment of monies held by it hereunder such amount as the Agent estimates
        to be
        sufficient to provide for the payment of such taxes not yet paid, and may
        use
        the sum withheld for that purpose. The Agent shall be indemnified and held
        harmless against any liability for taxes and for any penalties or interest
        in
        respect of taxes, on such investment income or payments in the manner provided
        in Section 4.6.

       

      4.6 The
        Agent
        will be indemnified and held harmless by the Company from and against any
        and
        all expenses, including reasonable counsel fees and disbursements, or loss
        suffered by the Agent in connection with any action, suit or other proceeding
        involving any claim, or in connection with any claim or demand, which in
        any
        way, directly or indirectly, arises out of or relates to this Agreement,
        the
        services of the Agent hereunder, the monies or other property held by it
        hereunder or any income earned from investment of such monies; provided,
        however, that such indemnification shall not extend to proven acts of gross
        negligence, willful misconduct or bad faith by the Agent. The Agent shall
        have a
        lien for the amount of any such expenses or loss on the monies and other
        property held by it hereunder and shall be entitled to reimburse itself from
        such monies or property for the amount of any such expense or loss. Promptly
        after the receipt by the Agent or notice of any demand or claim or the
        commencement of any action, suit or proceeding, the Agent shall, if a claim
        in
        respect thereof is to be made against the Company, notify the Company thereof
        in
        writing, but the failure by the Agent to give such notice shall not relieve
        the
        Company from any liability which the Company may have to the Agent hereunder.
        Notwithstanding any obligation to make payments and deliveries hereunder,
        the
        Agent may retain and hold for such time as it deems necessary such amount
        of
        monies or property as it shall, from time to time, in its sole discretion,
        deem
        sufficient to indemnify itself for any such loss or expense and for any amounts
        due it under Section 7. The terms of this Section 4.6 shall survive the
        termination of this Agreement.

       

      4.7 For
        the
        purposes hereof, the term “expense
        or loss”
        shall
        include all amounts paid or payable to satisfy any claim, demand or liability,
        or in settlement of any claim, demand, action, suit or proceeding settled
        with
        the express written consent of the Agent, and all costs and expenses, including,
        but not limited to, reasonable counsel fees and disbursements, paid or incurred
        in investigating or defending against any such claim, demand, action, suit
        or
        proceeding.

       

      5. Termination
        of Agreement and Resignation of Agent.

       

      5.1 This
        Escrow Agreement shall terminate on the final disposition of the monies and
        property held in escrow hereunder, provided that the rights of the Agent
        and the
        obligations of the other parties hereto under Sections 4 and 7 shall survive
        the
        termination hereof.

       

      5.2 The
        Agent
        may resign at any time and be discharged from its duties as Agent hereunder
        by
        giving the Company and Strasbourger at least 30 days' notice thereof. As
        soon as
        practicable after its resignation, the Agent shall turn over to a successor
        escrow agent appointed by the Company all monies and property held hereunder
        (less such amount as the Agent is entitled to retain pursuant to Section
        7) upon
        presentation of the document appointing the new escrow agent and its acceptance
        thereof. If no new Agent is so appointed within the 60-day period following
        such
        notice of resignation, the Agent may deposit the aforesaid monies and property
        with any court it deems appropriate.


      
        
           

        

        
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      6. Form
        of Payments by Agent.

       

      6.1 Any
        payments by the Agent to subscribers or to persons other than the Company
        pursuant to the terms of this Agreement shall be made by check, payable to
        the
        order of each respective subscriber or other person, or by wire
        transfer.

       

      6.2 Except
        as
        otherwise specifically indicated, all amounts referred to herein are expressed
        in United States Dollars and all payments by the Agent shall be made in such
        dollars.

       

      7. Compensation
        of Agent.
        For
        services rendered, the Agent shall receive as compensation $3,500 and all
        interest income on the funds received pursuant to this Agreement. The Agent
        shall also be entitled to reimbursement from the Company for all reasonable
        expenses paid or incurred by it in the administration of its duties hereunder,
        including, but not limited to, all counsel, advisors' fees and disbursements
        and
        all reasonable taxes or other governmental charges upon presentation of
        supporting documentation, if requested by the Company. It is anticipated
        that
        such disbursement shall not exceed $1,000 barring any unforeseen
        circumstances.

       

      8. Notices.
        All
        notices, requests, demands and other communications provided for herein shall
        be
        in writing, shall be delivered by overnight courier providing a receipt of
        delivery or by certified or registered mail, shall be deemed given when received
        and shall be addressed to the parties hereto at their respective addresses
        listed below or to such other persons or addresses as the relevant party
        shall
        designate as to itself from time to time in writing delivered in like
        manner.

       

      


      
        	
                if
                  to the Company:

              	 
	 	 
	
                1125
                  S. Walnut Street

                South
                  Bend, IN 46619

                Attention:
                  John A Martell

              	
                Telephone:
                  (574) 234-8131

                Facsimile:
                  (574) 232-7648

              
	 	 
	
                with
                  a copy to:

              	 
	 	 
	
                Barnes
                  & Thornburg

                600
                  1st
                  Source Bank Building

                100
                  N. Michigan St

                South
                  Bend, IN 46601

                Attention:
                  Richard L. Mintz, Esq.

              	
                Telephone:
                  (574) 233-1171 

                Facsimile:
                  (574) 237-1125

              
	 	 
	
                if
                  to the Agent:

              	 
	 	 
	
                Wilmington
                  Trust Company

                1100
                  North Market Street

                Wilmington,
                  DE 19890

                Attention:
                  Scott Huff

              	
                Telephone:
                  (302) 636-6449

                Facsimile:
                  (302) 636-4145

              


      


      
        
           

        

        
          5

          
            

          

        

        
           

        

      


      


      
        	
                if
                  to Strasbourger:

              	 
	 	 
	
                Strasbourger
                  Pearson Tulcin Wolff Inc.

                33
                  Whitehall Street, 17th
                  Floor

                New
                  York, NY 10004

                Attention:
                  Ron Moschetta

              	
                Telephone:
                  (646) 459-6972

                Facsimile:
                  (212) 785-1833

              
	 	 
	
                with
                  a copy to:

              	 
	 	 
	
                Gottbetter
                  & Partners, LLP

                488
                  Madison Ave, 12th
                  Floor

                New
                  York, NY 10022

                Attention:
                  Louis R. Cammarosano

              	
                Telephone:
                  (212) 400-6900

                Facsimile:
                  (212) 400-6901

              


      

       

      9. Further
        Assurances.
        From
        time to time on and after the date hereof, the Company shall deliver or cause
        to
        be delivered to the Agent such further documents and instruments and shall
        do
        and cause to be done such further acts as the Agent shall reasonably request
        (it
        being understood that the Agent shall have no obligation to make any such
        request) to carry out more effectively the provisions and purposes of this
        Agreement, to evidence compliance herewith or to assure itself that it is
        protected in acting hereunder.

       

      10. Consent
        to Service of Process.
        Each of
        the Company, Strasbourger and Agent hereby irrevocably consents to the
        jurisdiction of the courts of the State of New York and of any federal court
        located in such State in connection with any action, suit or other proceeding
        arising out of or relating to this Agreement or any action taken or omitted
        hereunder, and waives personal service of any summons, complaint or other
        process and agrees that the service thereof may be made by certified or
        registered mail directed to each of the Company and Strasbourger at its address
        for purposes of notices hereunder.

       

      11. Miscellaneous.

       

      11.1 If
        for
        any reason the escrow deposits are not received by the Agent as contemplated
        herein, the Company shall reimburse the Agent for all expenses, including
        reasonable counsel fees and disbursements, paid or incurred by it in making
        preparations for providing the services contemplated hereby.

       

      11.2 This
        Agreement shall be construed without regard to any presumption or other rule
        requiring construction against the party causing such instrument to be drafted.
        The terms “hereby,”“hereof,”“hereto,”“hereunder” and any similar terms, as
        used in this Agreement, refer to the Agreement in its entirety and not only
        to
        the particular portion of this Agreement where the term is used. The word
        “person” shall mean any natural person, partnership, company, government and any
        other form of business or legal entity. All words or terms used in this
        Agreement, regardless of the number or gender in which they are used, shall
        be
        deemed to include any other number and any other gender as the context may
        require. This Agreement shall not be admissible in evidence to construe the
        provisions of any prior agreement. The rule of ejusdem generis shall not
        be
        applicable herein to limit a general statement, which is followed by or
        referable to an enumeration of specific matters, to matters similar to the
        matters specifically mentioned.


      
        
           

        

        
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      11.3 This
        Agreement and the rights and obligations hereunder of the Company may be
        assigned by the Company only to a successor to the Company's entire business.
        This Agreement and the rights and obligations hereunder of the Agent may
        be
        assigned by the Agent only to a successor to its entire business. This Agreement
        shall be binding upon and inure to the benefit of each party's respective
        successors, and permitted assigns. No other person shall acquire or have
        any
        rights under or by virtue of this Agreement. This Agreement may not be changed
        orally or modified, amended or supplemented without an express written agreement
        executed by the Agent and the Company. This Agreement is intended to be for
        the
        sole benefit of the parties hereto, and (subject to the provisions of this
        Section 11.3) their respective successors, and assigns, and none of the
        provisions of this Agreement are intended to be, nor shall they be construed
        to
        be, for the benefit of any third person.

       

      11.4 This
        Agreement shall be governed by and construed in accordance with the internal
        laws of the State of New York. The representations and warranties contained
        in
        this Agreement shall survive the execution and delivery hereof and any
        investigations made by any party. The headings in this Agreement are for
        purposes of reference only and shall not limit or otherwise affect any of
        the
        terms hereof.

       

      12. Execution
        in Counterparts.
        This
        Agreement may be executed in any number of counterparts, each of which shall
        be
        deemed to be an original as against any party whose signature appears thereon,
        and all of which shall together constitute one and the same instrument. This
        Agreement shall become binding when one or more counterparts hereof,
        individually or taken together, shall bear the signature of all of the parties
        reflected hereon as the signatures.

       

      IN
        WITNESS WHEREOF, the parties have executed and delivered this Agreement on
        the
        day and year first above written.

    

    
      
        


        
          	 	
                  WILMINGTON
                    TRUST COMPANY

                
	 	 	 
	 	
                  By:

                	
                  /s/
                    Scott A. Huff

                
	 	
                  Name:

                	
                  Scott
                    A. Huff

                
	 	
                  Title:

                	
                  Financial
                    Services Officer

                
	 	 	 
	 	 	 
	 	
                  MAGNETECH
                    INTEGRATED SERVICES CORP.

                
	 	 	 
	 	
                  By:

                	
                  /s/
                    John A. Martell

                
	 	
                  Name:

                	
                  John
                    A. Martell

                
	 	
                  Title:

                	
                  President

                
	 	 	 
	 	 	 
	 	
                  STRASBOURGER
                    PEARSON TULCIN WOLFF, INC.

                
	 	 	 
	 	
                  By:

                	
                  /s/
                    Michael J. Schumacher

                
	 	
                  Name:

                	
                  Michael
                    J. Schumacher

                
	 	
                  Title:

                	
                  President

                


        

        


        


        
          
             

          

          
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