ESCROW AGREEMENT
THIS AGREEMENT made in triplicate this 14th day of January,
1994.
B E T W E E N:
ADVENTURE CAPITAL CORPORATION, a company duly incorporated
under the laws of Alberta, (the "Company") (herein called the
"Issuer")
OF THE FIRST PART
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THE R-M TRUST COMPANY, a trust company duly incorporated under
the laws of Canada ("R-M Trust") (herein called the "Trustee")
OF THE SECOND PART
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XXXXXXX X. XXXXXXX, businessman, of the City of West Vancouver
in the Province of British Columbia
XXXXX X. XXXXXXX, Barrister and Solicitor, of the City of
Calgary in the Province of Xxxxxxx
XXXXXX X.X. XXXXXXXX, Barrister and Solicitor, of the City of
Vancouver in the Province of British Columbia
XXXXXXX XXXXXX, Barrister and Solicitor, of the City of
Calgary in the Province of Alberta
XXXXX X. XXXXXX, businessman, of the Town of Chestermere in
the Province of Alberta
(herein collectively called the "Security Holders")
OF THE THIRD PART
WHEREAS in furtherance of complying with the requirements of
the Securities Act, Alberta Securities Commission Policy 4.11 and The Alberta
Stock Exchange Circular No. 7, the Security Holders are desirous of depositing
in escrow certain securities in the issuer
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owned or to be received by them;
AND WHEREAS the Trustee has agreed to undertake and perform
its duties according to the terms and conditions hereof;
NOW THEREFORE this agreement witnesses that, in consideration
of the sum of one dollar ($1.00) paid by the parties to each other, receipt of
this sum being acknowledged by each of the parties, the Security Holders jointly
and severally covenant and agree with the Issuer and with the Trustee, and the
Issuer and the Trustee covenant and agree each with the other and with the
Security Holders jointly and severally as follows:
1. Where used in this agreement, or in any amendment or supplement hereto,
unless the context otherwise requires, the following words and phrases shall
have the following ascribed to them below:
(a) "Major Transaction" shall include any material transaction in
accordance with the by-laws of The Alberta Stock Exchange, and
a transaction whereby:
(i) the issuer issues more than 25% of the number of its
previously outstanding securities to acquire assets
(other than cash) or securities of another issuer,
(ii) the issuer enters into an arrangement, amalgamation,
merger or reorganization with another issuer with
Significant Assets other than cash, whereby the
ration of securities which are distributed to the two
sets of security holders results in the security
holders of the other issuer acquiring control of the
resulting entity,
(iii) the issuer acquires Significant Assets, or
(iv) the issuer issues more than 25% of the number of its
previously outstanding securities for cash (a
"Private Placement");
(b) "Significant Assets" means assets (other than cash) or
securities of another issuer whereby the listed company meets
the minimum listing requirements under Circular No. 1 upon
completion of the acquisition.
2. Each of the Security Holders hereby undertakes and agrees to deposit in
escrow any securities of the Issuer which he has or may acquire pursuant to the
first Major Transaction or pursuant to the exercise of any option granted to him
by the issuer pursuant to the first Major Transaction (including any replacement
securities if an when issued) which securities are described in Schedule "A"
attached to this agreement.
3. The Parties hereby agree that, subject to the provisions of paragraph 6
herein, the securities and the beneficial ownership of any interest in them and
the certificate representing
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them (including any replacement securities or certificates) shall not be sold,
assigned, hypothecated, alienated, released from escrow, transferred within
escrow, or otherwise in any manner dealt with, without the written consent of
the Chief of Securities Administration of the Alberta Securities Commission
(hereinafter referred to as the "Chief") given to the Trustee or except as may
be required by reason of the death or bankruptcy of any Security Holder, in
which cases the Trustee shall hold the said certificates subject to this
agreement, for whatever person, or company shall be legally entitled to become
the registered owner thereof.
4. The Security Holders direct the Trustee to retain their respective securities
and the certificates (including any replacement securities or certificates)
representing them and not to do or cause anything to be done to release them
from escrow or to allow any transfer, hypothecation or alienation thereof,
without the written consent of the Chief. The Trustee accepts the
responsibilities placed on it by the agreement and agrees to perform them in
accordance with the terms of this agreement and the written consents, orders or
directions of the Chief.
5. Any Security Holder applying to the Chief for a consent for a transfer within
escrow shall, before applying, give reasonable notice in writing of his
intention to the Issuer and the Trustee.
6. Notwithstanding the provisions of paragraph 4 hereof, securities deposited
with the Trustee pursuant to this agreement shall be released, subject to the
prior written consent of the Chief, upon the Issuer completing a Major
Transaction (other than a Private Placement) as to one-third (1/3) of the
original number of escrowed securities on each of the first, second and third
anniversaries of the completion of the Major Transaction. The Chief, in his
discretion, may consent to the release of securities on the second and third
anniversaries of the completion of the Major Transaction when consent is granted
for the release of securities on the occasion of the first anniversary.
7. A release from escrow of all or part of the escrowed securities shall
terminate this agreement only in respect to those securities so released. For
greater certainty this paragraph does not apply to securities transferred within
escrow.
8. If during the period in which any of the securities are retained in escrow
pursuant hereto, any dividend is received by the Trustee in respect of the
escrowed securities, any such dividend shall be promptly paid or transferred to
the respective Security Holders entitled thereto.
9. All voting rights attached to the escrowed securities shall at all times be
exercised by the respective registered owners thereof.
10. The Security Holders hereby jointly and severally agree to and do hereby
release and indemnify and save harmless the Trustee from and against all claims,
suits, demands, costs, damages and expenses which may be occasioned by reason of
the Trustee's compliance in good faith with the terms hereof.
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11. The Issuer hereby acknowledges the terms and conditions of this Agreement
and agrees to take all reasonable steps to facilitate its performance and to pay
the Trustee's proper charges for its services as trustee of this escrow.
12. If the Trustee should wish to resign, it shall give at least 6 months'
notice to the Issuer which may, with the written consent of the Exchange, by
writing appoint another Trustee in its place and such appointment shall be
binding on the Security Holders, and the new Trustee shall assume and be bound
by the obligations of the Trustee hereunder.
13. The covenants of the Security Holders with the Issuer in this agreement are
made with the Issuer both in its own right and as trustee for the holders from
time to time of free securities in the Issuer, and may be enforced not only by
the Issuer but also by any holder of free securities.
14. This agreement may be executed in several parts of the same form and the
parts as so executed shall together constitute one original agreement, and the
parts, if more than one, shall be read together and construed as if all the
signing parties hereto and executed one copy of this agreement.
15. Wherever the singular or masculine is used, the same shall be construed to
include the plural or feminine or neuter where the context so requires.
16. This agreement shall enure to the benefit of and be binding on the parties
to this agreement and each of their heirs, executors, administrators, successors
and assigns.
IN WITNESS WHEREOF the Issuer and the Trustee have caused
their respective corporate seals to be hereto affixed and the Security Holder
has hereto set its hand and seal.
ADVENTURE CAPITAL CORPORATION
Per /s/ Xxxxxxx X. Xxxxxxx
Per /s/ Xxxxxx X. X. Xxxxxxxx
THE R-M TRUST COMPANY
Per /s/ Signature
Per /s/ Signature
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Signed sealed and delivered by the respective Security Holders
whose names are subscribed in the right-hand column below in the presence of the
respective persons whose names are subscribed in the left-hand column.
/S/ Signature /S/ XXXXXXX X. XXXXXXX
Witness Xxxxxxx X. Xxxxxxx
/S/ Signature /S/ XXXXX X. XXXXXXX
Witness Xxxxx X. Xxxxxxx
/S/ Signature /S/ XXXXXX X.X. XXXXXXXX
Witness Xxxxxx X.X. Xxxxxxxx
/S/ Signature /S/ XXXXXXX XXXXXX
Witness Xxxxxxx XxXxxx
/S/ Signature /S/ XXXXX XXXXXX
Witness Xxxxx Xxxxxx
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SCHEDULE "A"
to the Agreement dated this day of November, 1993, and made between Adventure
Capital Corporation therein called the "Issuer", The R-M Trust Company, therein
called the "Trustee" and Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxxx, Xxxxxx X.X.
Xxxxxxxx, Xxxxxxx XxXxxx and Xxxxx Xxxxxx therein called the "Security Holders".
Name of Number of Number of Certificate Signatures of
Security Securities Securities Numbers Security
Holder Allotted Escrowed of Holders
Securities
Escrowed
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Xxxxxxx X. Xxxxxxx 1,050,000 1,050,000 1 & 4 /S/ XXXXXXX X. XXXXXXX
Xxxxx X. Xxxxxxx 750,000 750,000 2 /S/ XXXXX X. XXXXXXX
Xxxxxx X.X. Xxxxxxxx 600,000 600,000 3 /S/ XXXXXX X.X. XXXXXXXX
Xxxxxxx XxXxxx 300,000 300,000 6 /S/ XXXXXXX XXXXXX
Xxxxx Xxxxxx 300,000 300,000 5 /S/ XXXXX XXXXXX
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