Unassociated Document


    Exhibit
      10.2

     

    ESCROW
      AGREEMENT 

     

    This
      Agreement is made as of the 5th
      day of
      April, 2007, between American Gas Services, Inc., a corporation organized and
      existing under the laws of the State of Minnesota (“AGS”), the owner of
a
      60%
      joint venture interest in Taian AGS Pipeline Construction Co. Ltd., a joint
      venture enterprise in the City of Taian, Shandong province, the People's
      Republic of China
      ("TAGS"), American
      Gas Services, Inc. Consultants, a corporation existing under the laws of Florida
      (“AGS Consultants”, and collectively with AGS, the “Owner”),
      WPCS
      International Incorporated, a corporation organized and existing under the
      laws
      of the State of Delaware, with its principal offices at One
      East
      Uwchlan Avenue, Suite 301, Exton Pennsylvania 19341 ("WPCS"),
      and Sichenzia Ross Friedman Ference LLP, a New York limited liability
      partnership having offices at 1065 Avenue of the Americas, New York, New
      York 10018 (the "Escrow Agent").

     

    RECITALS

     

    The
      AGS,
      AGS Consultants and WPCS are parties to that certain Interest Purchase
      Agreement, dated as of even date herewith (the "Purchase Agreement"). WPCS
      and
      the Owner wish to provide for the escrow of cash and shares of WPCS common
      stock
      (the “Shares”) pursuant to the Purchase Agreement, and desire that the Escrow
      Agent hold such cash and Shares in connection therewith pursuant to the
      provisions of this Agreement, and the Escrow Agent is willing to hold such
      cash
      and Shares pursuant to the provisions of this Agreement. All capitalized terms
      contained herein and not otherwise defined shall have the meaning ascribed
      to
      them in the Purchase Agreement. In consideration of the premises and mutual
      covenants, agreements, representations and warranties contained herein, the
      parties hereby agree as follows:

     

    1. WPCS
      and
Owner
      hereby appoint the Escrow Agent to hold $80,000 in cash and 6,808 Shares (the
      "Escrowed Property"), in an attorney trust account, and the Escrow Agent accepts
      such appointment, subject to the terms and conditions hereof. WPCS has, prior
      to
      the execution of this Escrow Agreement, delivered by way of wire transfer to
      the
      Escrow Agent the cash portion of the Escrowed Property and will deliver the
      Shares to the Escrow Agent within three (3) business days of the Closing Date,
      hereby irrevocably instructs the Escrow Agent to deal with the Escrowed Property
      on and subject to the terms hereof. In executing this Escrow Agreement the
      Escrow Agent acknowledges receipt of the Escrowed Property and the instructions
      contained herein. Upon deposit of the Escrowed Property, the Escrow Agent shall
      provide written evidence of such deposit to the Owner and WPCS.


    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

     

    2.
         
      (a) The
      Escrow Agent shall retain the Escrowed Property until the NTAV of the Company
      as
      of the Closing Date shall be determined. 

     

    (b) the
      Purchase Price shall be adjusted by an amount equal to 60% of the difference
      between (a) the net tangible asset value of TAGS as of the Closing Date, and
      (b)$3,300,000. Net tangible asset value is defined as total assets minus total
      liabilities minus intangible assets, calculated in accordance with Generally
      Accepted Accounting Principles (“NTAV”). Any shortfall from the $3,300,000 shall
      proportionately reduce the cash and stock components of the Purchase Price.
      The
      Escrow Agent shall only deliver the Escrowed Property upon (i) written
      notification signed by each of the Owner and WPCS of a final determination
      of
      the NTAV or (ii) delivery to the Escrow Agent of a written arbitration award
      with respect to the determination of the NTAV.

     

    (c)
       The
      balance of any amount remaining after the delivery of payments required pursuant
      to Section 2(b) above (the “Escrow Payment”) shall be delivered to the Owner
      within three (3) business days of the date of the escrow payments required
      by
      Section 2(b) above.

     

    3. The
      Escrow Agent shall, from time to time, deliver all or some of the Escrowed
      Property to WPCS or the Owner in accordance with such written instructions,
      jointly executed by WPCS and the Owner, as the Escrow Agent may
      receive.

     

    4. The
      Escrow Agent shall not be under any duty to give the Escrowed Property
      any greater degree of care than it gives its own similar property, and it shall
      have no liability hereunder, except for the willful breach or gross negligence
      of its duties hereunder.


    
      
        
        

      

      
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    5. The
      Escrow Agent shall have no duties or responsibilities except those expressly
      set
      forth herein, and no implied duties or obligations should be read into this
      Escrow Agreement against the Escrow Agent. The Escrow Agent need not refer
      to,
      and will not be bound by, the provisions of any other agreement, except for
      definitions of terms contained in the Purchase Agreement.

     

    6. The
      Escrow
      Agent may consult with counsel and shall be fully protected with respect to
      any
      action taken or omitted by it in good faith on advice of counsel.

     

    7. The
      Escrow Agent makes no representation as to the validity, value, genuineness
      or
      the collectibility of any security or other document or instrument held by
      or
      delivered to it.

     

    8. The
      Escrow Agent will receive no compensation for its services
      hereunder.

     

    9. In
      the
      event that the Escrow Agent shall be uncertain as to its duties or rights
      hereunder, or shall receive instructions from WPCS and the Owner, with respect
      to the Escrowed Property, which, in its opinion, are in conflict with any of
      the
      provisions hereof (i) it shall be entitled to refrain from taking any action,
      and in doing so shall not become liable in any way or to any person for its
      failure or refusal to comply with such conflicting demands, and it shall be
      entitled to continue so to refrain from acting and so refuse to act until it
      shall be directed otherwise, in writing, jointly by WPCS and the Owner or until
      it shall receive a final determination of a court of law, arbitration panel,
      or
      similar adjudicative body, or (ii) it may commence as interpleader action in
      any
      court of competent jurisdiction to seek an adjudication of the rights of WPCS
      and the Owner.

     

    10. The
      Escrow Agent may act in reliance upon any notice, instruction, certificate,
      statement, request, consent, confirmation, agreement or other instrument which
      it believes
      to be genuine and to have been signed by a proper person or persons, and may
      assume that any of the officers of WPCS or the Owner purporting to act on behalf
      of WPCS or the Owner in giving any such notice or other instrument in connection
      with the provisions hereof has been duly authorized to do so.


    
      
        
        

      

      
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    11.1 In
      the
      event that the Escrow Agent retains counsel or otherwise incurs any legal fees
      by virtue of any provision of this Escrow Agreement, the reasonable fees and
      disbursements of such counsel and any other liability, loss or expense which
      the
      Escrow Agent may thereafter suffer or incur in connection with this Escrow
      Agreement or the performance or attempted performance in good faith of its
      duties hereunder shall be paid (or reimbursed to it) by WPCS. In the event
      that
      the Escrow Agent shall become a party to any litigation in connection with
      its
      functions as Escrow Agent pursuant to this Escrow Agreement, whether such
      litigation shall be brought by or against it, the reasonable fees and
      disbursements of counsel to the Escrow Agent including the amounts attributable
      to services rendered by members or associates of Escrow Agent at the then
      prevailing hourly rate charged by them and disbursements incurred by them,
      together with any other liability, loss or expense which it may suffer or incur
      in connection therewith, shall be paid (or reimbursed to it) by WPCS, unless
      such loss, liability or expense is due to the willful breach or gross negligence
      by the Escrow Agent of its duties hereunder.

     

    11.2
      WPCS
      hereby unconditionally agrees to indemnify the Escrow Agent and hold it harmless
      from and against any and all taxes (including federal, state and local taxes
      of
      any kind and other governmental charges), expenses, damages, actions, suits
      or
      other charges incurred by or brought or assessed against it for (i) anything
      done or omitted by it in the performance of its duties hereunder, or (ii) on
      account of acting in its capacity as an Escrow Agent or stakeholder hereunder,
      except as a result of its willful breach or gross negligence of its duties
      under
      this Escrow Agreement.


    
      
        
        

      

      
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    11.3 
      All
      reasonable expenses incurred by the Escrow Agent in connection with the
      performance of its duties hereunder shall be paid (or reimbursed to it) by
      WPCS
      and the Owner, jointly and severally.

     

    11.4
      The
      agreements contained in this Section 11 shall survive any termination of the
      duties of the Escrow Agent hereunder.

     

    12. The
      terms
      and provisions of this Escrow Agreement may not be waived, discharged or
      terminated orally, but only by an instrument in writing signed by the person
      or
      persons against whom enforcement of the discharge, waiver or termination is
      sought.

     

    13. The
      Escrow Agent shall not be bound by any modification of the provisions of this
      Escrow Agreement, unless such modification is in writing and signed by WPCS
      and
      the Owner, and, with respect to any modification in Escrow Agent's duties or
      its
      rights of indemnification hereunder, it shall have given their prior written
      consent thereto.

     

    14. WPCS
      and
      the Owner shall, from time to time, execute such documents and perform such
      acts
      as the Escrow Agent may reasonably request and as may be necessary to enable
      the
      Escrow Agent to perform its duties hereunder or effectuate the transactions
      contemplated by this Escrow Agreement.

     

    15. WPCS
      and
      the Owner hereby acknowledge that the acts of the Escrow Agent are purely
      ministerial and do not represent a conflict of interest for the Escrow Agent
      to
      act, or continue to act, as counsel for any party to this Agreement with respect
      to any litigation or other matters arising out of this Agreement or
      otherwise.

     

    16. The
      Escrow Agent may resign at any time upon twenty (20) days' written notice to
      WPCS and the Owner. In the event of the Escrow Agent's resignation, its only
      duty thereafter shall be to hold and dispose of the Escrowed Cash in accordance
      with the provisions of this Agreement until a successor Escrow Agent shall
      be
      appointed and written notice of the name and address of such successor Escrow
      Agent shall be given to the resigning Escrow Agent by the other parties hereto,
      whereupon the resigning Escrow Agent's only duty shall be to deliver the
      Escrowed Cash to the successor Escrow Agent.


    
      
        
        

      

      
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    17. The
      rights created by this Agreement shall inure to the benefit of, and the
      obligations created hereby shall be binding upon, the heirs, successors, assigns
      and personal representatives of the Escrow Agent, WPCS and the
      Owner.

     

    18.
      Each
      notice, demand, request, approval or communication ("Notice") which is or may
      be
      required to be given by any party to any other party in connection with this
      Agreement and the transactions contemplated hereby, shall be in writing, and
      given by personal delivery, certified mail, return receipt requested, prepaid,
      or by overnight express mail delivery and properly addressed to the party to
      be
      served at such address as set forth above. 

     

    Notices
      shall be effective on the date delivered personally, the next day if delivered
      by overnight express mail or three days after the date mailed by certified
      mail.

     

    19. This
      Escrow Agreement shall be governed by, and its provisions construed in
      accordance with the laws of the State of New York.

    


    


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    IN
      WITNESS WHEREOF,
      the
      parties hereto have caused this Escrow Agreement to be duly executed as of
      the
      day and year first above written.

     

     

    
      	 	 	 
	 	
              WPCS
                INTERNATIONAL INCORPORATED

            
	 
 	 
 	 
 
	
            	By:  	/s/ ANDREW
              HIDALGO
	 	
              
                

              

              Andrew
                Hidalgo

              Chief
                Executive Officer

            
	 	 



      	 	 	 
	 	
              SELLER:

               

              AMERICAN
                GAS SERVICES, INC.

            
	 
 	 
 	 
 
	 	By:  	/s/ HAROLD
              MUELLER
	 	
              
                

              

              Name:
                Harold Mueller

              Title:
                President

            
	 	 




    
      	 	 	 
	 	
              AMERICAN
                GAS SERVICES, INC. CONSULTANTS:

            
	 
 	 
 	 
 
	 	By:  	/s/ HAROLD
              MUELLER
	 	
              
                

              

              Name:
                Harold Mueller

              Title:
                President

            
	 	 



      	
               
                
                ESCROW
                  AGENT:

                SICHENZIA
                  ROSS FRIEDMAN FERENCE LLP

              

               

               

               

            	 	 	 
	/s/ THOMAS
              A. ROSE	 	 	 
	
              

              Thomas
                A. Rose,

              Partner