ESCROW AGREEMENT
Exhibit
99.2
THIS
ESCROW AGREEMENT
(the
“Agreement”), is made and entered into as of the 5th day of February, 2008, by
and between Lodestar Mining, Inc. (“Corporation”), a Delaware corporation, with
a principal office at 000 Xxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxx Xxxxxx X0X 0X0
and
National City Bank, 000 Xxxx Xxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000 (the “Escrow
Agent”).
WHEREAS,
the
Corporation is raising additional capital through the sale of up 2,000,000
shares of Common Stock at a price of $0.05 per share (the “Shares” or the
“Securities”). This is a “best efforts/no minimum” offering (the “Offering”) all
as described in the Subscription Agreement.
WHEREAS,
the
Corporation is authorized and desires to commence this Offering
promptly;
WHEREAS,
the
Corporation wishes by this Agreement to provide for the periodic receipt,
deposit, safekeeping and disbursement of payments and subscription documents
submitted by persons subscribing to shares of common stock pursuant to the
Offering; and
WHEREAS,
the
Escrow Agent has agreed to act as such for the Corporation for the Offering
subject to the terms and conditions of this Agreement.
WITNESSETH:
NOW,
THEREFORE,
For and
in consideration of certain payments to be made by Corporation to the Escrow
Agent in consideration of its services hereinafter set forth, and other good
and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Corporation and the Escrow Agent do hereby covenant and agree
as
follows:
1. Appointment
of Escrow Agent.
Corporation does hereby appoint the Escrow Agent as escrow agent for the
Offering to perform the functions and provide the services hereinafter provided,
and the Escrow Agent does hereby accept the appointment as Escrow Agent upon
the
terms and conditions set forth in this Agreement.
2. Receipt
and Deposit of Funds.
Persons
wishing to subscribe for Securities interests under the offering are required
to
execute a Subscription Agreement. Prospective investors must pay cash for their
subscription. The prospective investor must forward the Subscription Agreement
and their subscription cash payment to the Escrow Agent. Funds received by
the
Escrow Agent pursuant to the Offering shall be held in escrow and deposited
promptly and the Subscription Agreement shall be held for the benefit of the
Corporation pending disbursement in accordance with the terms and conditions
hereof. Checks and money orders should be made payable to “National City Bank,
Lodestar Mining, Inc. Escrow Account”. Recognizing that in some cases checks and
money orders may be made payable to the Corporation, the Corporation does hereby
appoint the Escrow Agent as its lawful attorney-in-fact for the purposes of
endorsing said checks and money orders, which promptly upon receipt shall be
deposited in a non-interest bearing escrow account for the benefit of the
Corporation pending disbursement and release of the funds in accordance with
the
terms and conditions of this Agreement. The Escrow Agent shall be charged with
responsibility to exercise reasonable care and due diligence in the deposit
of
funds received by it pursuant to the Offering.
3. Records
to Be Kept by the Escrow Agent.
The
Escrow Agent shall maintain records of the name, address, and subscription
payments for each subscription it receives under the Offering. Subscription
Agreements forwarded to the Escrow Agent shall be directed to National City
Bank
at the above address for the Escrow Agent, or to such other person as Escrow
Agent shall designate in writing. Upon request, the Escrow Agent shall forward
to the Corporation a summary of subscriptions received to date.
4. Funds
and Documents to Be Returned If Conditions Not Met.
Subject
to the other provisions of this Agreement, the Escrow Agent shall return
subscription payments, and the proceeds of all closed subscription loans, plus
the Subscription Agreement to any subscriber from whom the 1) Corporation has
not accepted the Subscription Agreement, 2) has submitted a Subscription
Agreement after the termination of the Offering, which will be 180 days after
the offering, unless extended by the Corporation for an additional 90 days,
or
3) in the event that 1,000,000 shares are not sold within the 180 days, or
within the additional 90 days if extended. If at least 1,000,000 shares are
sold
within 180 days, or within the additional 90 days, if extended, all money
received by us will be retained by us and there will be no refund. There are
no
minimum purchase requirements for each individual investor. The foregoing
notwithstanding, the Escrow Agent shall not be obligated, in any manner, to
return any subscription payments which have been disbursed by it in accordance
with paragraph 5 hereof. If the Escrow Agent is required to return documents
and
the subscription payments pursuant to this paragraph, it shall do so within
(14)
days after termination of the Offering Period, including any extension thereof.
5. Funds
May Be Paid to Corporation Once Subscription Conditions Are
Met.
Upon
receipt by the Escrow Agent of: (1) Executed acceptances by Corporation of
Subscription Agreements and (2) Upon certification by securities counsel for
Corporation that the terms of the Offering have been met, and that the
Corporation’s Stock Transfer Agent has been authorized and notified to duly
issue certificates evidencing ownership of the shares of the Corporation’s
corporate stock to each investor whose Subscription Agreement has been accepted,
then Escrow Agent shall disburse the funds held by it in escrow to the
Corporation. Funds will be held in escrow by national City Bank of Lexington,
Kentucky until the Corporation sells at least 1,000,000 shares of common stock.
Once the Corporation sells at least 1,000,000 shares of common stock, National
City Bank of Lexington, Kentucky will release the funds from escrow to the
Corporation. If the Corporation does not accept the subscription of a
subscriber, as evidenced by written notice to the Escrow Agent, then the Escrow
Agent shall return the Subscription Agreement, all related documents, and
subscription payment without interest to the Subscriber.
6. Compensation
for Escrow Agent’s Services.
It is
understood and agreed between the parties to this Agreement that the
compensation to be paid to the Escrow Agent hereunder is intended primarily
to
compensate the Escrow Agent for the record-keeping and processing associated
with the performance of its obligations hereunder. The compensation to be paid
to the Escrow Agent for its services rendered in connection with this Agreement
shall be at its usual and customary rates and it shall be reimbursed any and
all
expenses it incurs in performing its duties herein.
7. Escrow
Agent’s Duties Limited. The
sole
responsibility of the Escrow Agent shall be to receive, hold and release the
aforesaid Subscription Agreements, documents, and funds in accordance with
the
provisions hereof. In disbursing funds, the Escrow Agent may rely solely upon
documents and events specified in this Agreement. The Escrow Agent shall have
no
duties and obligations except such as are specifically stated herein. It is
specifically understood that Escrow Agent has not rendered any other services
or
given advice regarding the Offering including, but not limited to, the
applicable securities laws or securities aspects of this transaction, the tax
laws or tax effect of this transaction, or any assessment of the risks involved
in the Offering or the qualifications for any of the Subscribers, or given
any
investment advice or recommendations, and will decline to do so if asked by
the
Corporation or any other party to this transaction.
8. Escrow
Agent’s Liability Limited.
The
Escrow Agent shall not be liable for any error of judgment or act done or
committed by it in good faith in connection with its duties as Escrow
Agent.
9. Reliance
by Escrow Agent On Documents Presented.
The
Escrow Agent hereby is authorized to act upon the assumption that all agreements
or documents delivered to it by Corporation and the subscribers to this Offering
are genuine and have been duly signed by the proper party or parties. The Escrow
Agent shall not be bound by any modification of this Agreement unless the same
shall be in writing and be signed by all parties hereto.
10. Escrow
Agent’s Duties In the Event of Adverse Claims.
In the
event of disagreement between subscribers and Corporation, or upon the
presentation an adverse claim or demand on the escrowed funds, the Escrow Agent
may, at its option, refuse to perform its duties as Escrow Agent until such
time
as the disagreement or adverse claim or demand has been fully resolved,
judicially or otherwise, and in this regard Escrow Agent shall not be liable
for
failure to perform its duties during this time.
11. Escrow
Agent Held Harmless.
It is
expressly understood and agreed by the parties to this Agreement, and their
respective successors and assigns, that the Escrow Agent shall be free and
harmless from any and all claims, disputes or defenses which may arise between
Corporation or its legal successors and assigns, and the subscribers or any
other person which may for any reason have a claim against the funds escrowed
hereunder or against Corporation. Corporation hereby agrees to hold the Escrow
Agent harmless from and indemnify it for any liability or expense that may
be
incurred by the Escrow Agent by virtue of any claim, dispute, or defense. If
any
such claim is asserted, the Escrow Agent may engage counsel of its choice and
shall be entitled to reimbursement of reasonable legal fees and expenses to
defend it against such claim and, in the event any such claimant is successful
in establishing such a claim, Corporation will hold the Escrow Agent harmless
and make all payments required to be made pursuant to any final order or
judgment that may be entered against the Escrow Agent by a court of competent
jurisdiction.
12. Termination.
This
Agreement may be terminated at any time by the written agreement of all
parties.
13. Notices.
Until
further notice, all communications and notices given with respect to this
Agreement shall be made to the addresses first written above.
14. Headings.
All
headings contained in this Agreement are for convenience and reference only,
and
shall not constitute a part of this Agreement.
15. Entire
Agreement.
This
Agreement is the entire agreement and understanding between the Corporation
and
the Escrow Agent, and there are no representations, warranties, promises,
inducements, covenants or conditions made by any of the parties except as
expressly contained herein.
16. Binding
Effect.
This
Agreement shall inure to the benefit, and the binding upon, the representatives,
successors and assigns of each party.
17. Governing
Law.
This
Agreement shall be governed by and interpreted in conformity with, the laws
of
the Commonwealth of Kentucky without regard to its provisions governing the
choice of laws.
18. Authority.
Both
signatories to this Agreement warrant and represent that he has the appropriate
authority to execute this Agreement and bind the entity for whom he is signing
the Agreement.
IN
WITNESS WHEREOF,
the
parties have hereunto affixed the following signatures as of the day and year
first above written.
| LODESTAR MINING, INC. | |
| BY: /s/ Xxx XxXxxxxx | |
|
XXX
XXXXXXXX, CEO
|
|
| ESCROW AGENT | |
| BY: /s/ Xxxxx ale Luca | |
| NATIONAL CITY BANK | |
| BY: /s/ Xxxxxx Garnen | |
