EXHIBIT k
ESCROW AGREEMENT
This Escrow Agreement (the "Agreement") is entered into this ____ day
of __________, 2003, between NAIC Growth Fund, Inc., a Maryland corporation (the
"Fund"), Broker Dealer Financial Services Corp., an Iowa corporation (the
"Underwriter"), and Standard Federal - Corporate and Institutional Trust, a
division of LaSalle Bank National Association (the "Escrow Agent").
RECITALS
A. The Fund proposes to issue and sell through the Underwriter up to
5,000,000 shares of its common stock, par value $0.001 per share (the "Shares")
in accordance with the terms of an Underwriting Agreement between the Fund, the
Underwriter and Growth Fund Adviser, Inc. dated _________, 2003 (the
"Underwriting Agreement").
B. The Fund and the Underwriter desire that the payments received from
prospective purchasers in the offering be placed in escrow until released to the
Fund pursuant to the terms of this Agreement.
THEREFORE, it is hereby agreed as follows:
1. Each person desiring to purchase Shares in the offering ("Purchaser")
will be required to send the Fund a subscription agreement to subscribe
for such Shares ("Subscription Agreement") and a check payable to the
Escrow Agent in the amount of the purchase price, including the
applicable sales charge, for the Shares the Purchaser desires to
purchase (the "Subscription Payment").
2. The Fund will deposit any Subscription Payment it receives with the
Escrow Agent and will provide the Escrow Agent with the following
information, with a copy to the Underwriter, with respect to each
Subscription Payment it receives:
(a) The name and address of the Purchaser,
(b) The date of the Subscription Agreement received by the Fund
related to such Subscription Payment; and
(c) The dollar amount of the Subscription Payment relating to such
Subscription Agreement.
3. The Escrow Agent shall provide the Fund with a report by 9:00 a.m.
local time on the first business day following each Determination Date
(as hereafter defined). Each report shall be prepared as of 5:30 p.m.,
local time, of the applicable Determination Date and shall set forth
the name of each Purchaser from whom the Escrow Agent has received
previously unreported collected funds and the amount of previously
unreported collected funds for each such Purchaser, as of such date and
time. The Fund will provide the Underwriter with a copy of each such
report. For purposes of this Agreement, a "business day" shall mean any
day on which the Growth Fund Advisor, Inc. and the New York Stock
Exchange are open for business and the Fedwire service of the Federal
Reserve
Board is operational, and "Determination Date" means Thursday of each
week, or if any Thursday is not a business day, the business day
immediately preceding such Thursday.
4. The Escrow Agent shall hold any Subscription Payments which it receives
in escrow, uninvested and subject to the provisions of this Agreement.
The Escrow Agent shall provide the Fund with a monthly statement of
receipts and disbursements made pursuant to this Agreement. The Fund
shall provide the Underwriter with a copy of each such statement.
5. The Fund and the Underwriter have each reserved the right, in their
sole discretion, to accept or to not accept a Subscription Agreement.
If for any reason a Subscription Agreement is not accepted by either
the Fund or the Underwriter, the Fund will instruct the Escrow Agent in
writing, with a copy to the Underwriter, to refund the related
Subscription Payment to the applicable Purchaser, without interest. The
Escrow Agent shall refund such Subscription Payments within five
business days of receiving such written instruction.
6. Upon acceptance of a Subscription Agreement by the Fund and the
Underwriter and sale by the Fund of the related Shares to the
applicable Purchaser, the Fund shall notify the Escrow Agent of such
acceptance, the settlement date for the sale of such Shares, the amount
of the sales charge payable from the Subscription Payment to the
Underwriter with respect to such Shares, and the net amount of the
Subscription Payment payable to the Fund. The Fund shall provide the
Underwriter with a copy of each such notice. The Escrow Agent shall, on
the settlement date, deposit the net amount of the Subscription Payment
payable to the Fund to the Fund's account no. ___________________ with
the Escrow Agent and shall pay the amount of the related sales charge
to the Underwriter no later than the close of business on the first
business day following such settlement date.
7. The duties and obligations of the Escrow Agent hereunder shall be
determined solely by the express provisions of this Agreement, and not
by any other agreement, including, without limitation, the Underwriting
Agreement. The Escrow Agent shall not be liable or responsible for any
act done or step taken or omitted by it or any mistake of fact or law
or for anything which it may do or refrain from doing, except for its
gross negligence, willful misconduct or willful default in the
performance of any obligation imposed upon it hereunder.
8. The Escrow Agent shall not be liable to the Underwriter or to any other
person for acting upon any written instruction which it receives from
the Fund pursuant to this Agreement. The Escrow Agent is authorized to
act in reliance upon the sufficiency, correctness, genuineness or
validity of any instrument or document or other writing submitted to it
hereunder and shall have no liability with respect to such matters.
9. The Escrow Agent is not obligated to render any statements or notices
of non-performance hereunder to any party to this Agreement but may in
its discretion inform any party or its authorized representative of,
any matters pertaining to this Agreement.
10. The Escrow Agent's fee as set forth in the attached fee schedule shall
be paid by the Fund. The Fund agrees to indemnify and hold harmless the
Escrow Agent from any costs, damages, expenses or claims, including
attorney's fees, which the Escrow Agent may
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incur or sustain as a result of or arising out of this Agreement or the
Escrow Agent's duties relating thereto and will pay them on demand.
11. The Escrow Agent shall be reimbursed by the Fund for all disbursements
and expenses made or incurred hereunder and if Escrow Agent shall be
required to perform extraordinary services not contemplated herein, it
shall receive reasonable additional compensation from the Fund
therefor. The Escrow Agent shall not be required to institute or
maintain litigation unless indemnified to its satisfaction for its
counsel fees, costs, disbursements and all other costs, expenses and
liabilities to which it may in its judgment be subjected in connection
with such action.
12. In the event of any disagreement or the presentation of adverse claims
or demands in connection with the property deposited pursuant to this
Agreement, the Escrow Agent shall, at its option, be entitled to refuse
to comply with any such claims or demands during the continuance of
such disagreement and may refrain from delivering any item affected
thereby, and in so doing, the Escrow Agent shall not become liable to
Fund or Underwriter, or either of them, or to any other person, due to
its failure to comply with any such adverse claim or demand. The Escrow
Agent shall be entitled to continue, without liability, to refrain and
refuse to act:
(a) Until all the rights of the adverse claimants have been
finally adjudicated by a court having jurisdiction of the
parties and the items affected thereby, after which time the
Escrow Agent shall be entitled to act in conformity with such
adjudication and related court order; or
(b) Until all differences shall have been adjusted by agreement
and the Escrow Agent shall have been notified thereof and
shall have been directed in writing signed jointly or in
counterpart by Fund and Underwriter and by all persons making
adverse claims or demands, at which time the Escrow Agent
shall be protected in acting in compliance therewith.
The parties agree that the Escrow Agent may seek adjudication of any
adverse claim or demands in either the Circuit Court for the County of
Oakland, Michigan, or the United States Federal District Court for the
Eastern District of Michigan, Southern Division, agree to the
jurisdiction of either of said Courts over their persons as well as the
property deposited pursuant to this Agreement, waive personal service
of any process, and agree that service of process by certified or
registered mail, return receipt requested, to the address set forth in
Section 15 below shall constitute adequate service. Without limiting
the foregoing right, the parties further agree that the Escrow Agent
may interplead all of the property held by it hereunder into either of
the above-referenced courts, and thereafter be fully relieved from any
and all liability or obligation with respect to such interpleaded
property and with respect to this Agreement.
13. The entire agreement of the parties with respect to the subject matter
hereof is contained herein, provided that nothing contained herein
shall be deemed to supersede, limit or modify the Underwriting
Agreement. Any change in terms or conditions herein may only be made in
writing signed by all parties hereto. The Escrow Agent shall not be
charged with knowledge of any fact, including but not limited to
performance or non-performance
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of any condition, unless it has actually received written notice
thereof from one of the parties pursuant to Section 15, such notice
clearly referring to this Agreement.
14. The Fund may designate another person to take any actions which are
required or permitted to be taken by the Fund under this Agreement. Any
such designation shall be in writing and shall be provided to the other
parties to this Agreement pursuant to Section 15. Such parties may rely
upon such designation until they receive written notice to the contrary
from the Fund pursuant to Section 15.
15. All notices or communications hereunder shall be in writing and shall
be mailed, delivered, or telecopied and confirmed as follows. Each
party to this Agreement may change such address for notices by sending
to the parties to this Agreement written notice of a new address for
such purpose.
If to the Underwriter:
Broker Dealer Financial Services Corp.
0000 XX 00xx Xxxxxx
X.X. Xxx 0000
Xxxxxxxx, Xxxx 00000-0000
Attention: X.X. Xxxxxx
Facsimile no. (000) 000-0000
If to the Fund:
NAIC Growth Fund, Inc.
(address for mail)
X.X. Xxx 000
Xxxxx Xxx, Xxxxxxxx 00000
(address for delivery)
000 Xxxx Xxxxxxxx Xxxx Xxxx
Xxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Facsimile no. (000) 000-0000
If to the Escrow Agent:
Standard Federal - Corporate and Institutional Trust
0000 X. Xxx Xxxxxx Xxxx, Xxxxx 000
Xxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx
Facsimile no. (000) 000-0000
16. This Agreement shall be deemed to have been made under and shall be
governed by the laws of the State of Michigan in all respects,
including matters of construction, validity and performance.
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17. The Escrow Agent may resign as such following the giving of thirty days
prior written notice to the other parties hereto. Similarly, the Escrow
Agent may be removed and replaced following the giving of thirty days
prior written notice to the Escrow Agent by the other parties hereto.
In either event, the duties of the Escrow Agent shall terminate thirty
days after the date of such notice (or as of such earlier date as may
be mutually agreeable); and the Escrow Agent shall deliver the balance
of the property then in its possession to a successor escrow the Escrow
Agent as shall be appointed by the other parties hereto as evidenced by
a written notice filed with the Escrow Agent, or if no successor Escrow
Agent has been so appointed, the then acting Escrow Agent shall deliver
the balance of the escrow deposit then in its possession to the
applicable Purchasers as their interests may appear.
18. No waiver of any past agreement or condition hereunder by any party
hereto shall operate as a continuing waiver of any agreement or
condition under this Agreement. Each party shall have the right to
waive and/or nullify, in writing, any condition or term of this
Agreement which is for its or his benefit.
19. If any provision or clause in this Agreement or application thereof to
any person or circumstances is held invalid or unenforceable, such
invalidity or unenforceability shall not affect other provisions or
applications of this Agreement which can be given effect without the
invalid or unenforceable provision or application, and to this end the
provisions of this Agreement are declared to be severable.
NAIC GROWTH FUND, INC.
By: ______________________________________
Its: _____________________________________
BROKER DEALER FINANCIAL SERVICES CORP.
By: ______________________________________
Its: _____________________________________
STANDARD FEDERAL - CORPORATE AND
INSTITUTIONAL TRUST
By: ______________________________________
Its: _____________________________________
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