ESCROW AGREEMENT
THIS AGREEMENT made this 20th day of September, 1995.
AMONG: XXXXXXXX COMMUNICATIONS LTD., a corporation duly constituted
having its head office at 0000 Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxxx, Xxxxxxx (hereinafter referred to as "Xxxxxxxx")
XXXXXX TRAVEL, LIMITED, a corporation duly constituted having
its head office at 0000 Xxxx Xxxxxx Xxxxxxxxx, Xxxxx X000, Xxx
Xxxxx, Xxxxxx (hereinafter referred to as "Xxxxxx")
INTEK DIVERSIFIED CORPORATION, a corporation duly constituted
having its head office at 000 Xxxx 000xx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx (hereinafter referred to as "Intek")
(hereinafter called collectively the "Security Holders")
OF THE FIRST PART
AND: MONTREAL TRUST COMPANY OF CANADA, 0000, XxXxxx Xxxxxxx Xxxxxx,
Xxxxxxxx, Xxxxxx,
(hereinafter called the "Trustee")
OF THE SECOND PART
AND: BROOKLINE MINERALS INC., a corporation duly constituted having
its head office at 900 - 999 West Hastings Street, in the City
of Vancouver, Province of British Columbia,
(hereinafter called the "Issuer")
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OF THE THIRD PART
WHEREAS the Security Holders are about to receive up to seventeen
million and one (17,000,001) common shares of the Issuer (the "Shares") in
connection with the transactions (the "Transactions") contemplated by the
share purchase agreement (the "Share Purchase Agreement") made as of August
24, 1995 among the Issuer and the Security Holders; and
WHEREAS in furtherance of complying with the requirements of the
Montreal Exchange (the "Exchange"), each of the Security Holders is desirous
of depositing in escrow a number of Shares corresponding to 80% of the Shares
that are issued to him pursuant to the Transactions; and
WHEREAS the Trustee has agreed to undertake and perform its duties
according to the terms and conditions hereof.
NOW, THEREFORE, THIS AGREEMENT WITNESSETH that for and in consideration
of the aforesaid agreements, and of the sum of one dollar ($1.00) now paid by
the parties hereto each to the other (receipt of which the parties do hereby
respectively acknowledge each to the other) the Security Holders, the Issuer
and the Trustee covenant and agree each with the other as follows:
1. For the purposes of this agreement, terms and expressions with initial
capital letters used but not otherwise specifically defined in this Agreement
shall have the respective meanings attributed to such terms and expressions
in the Share Purchase Agreement.
2. The Security Holders hereby undertake and agree to place and deposit in
escrow with the Trustee the Shares which are represented by the certificates
described or referred to in Schedule "A" hereto together with certificates
representing 80% of the Shares issued to them in the future as part of the
Transactions (up to a maximum of 13,600,001 Shares) and hereby undertake and
agree forthwith to deliver from time to time those certificates (including
any replacement securities or certificates, if, as and when such are issued)
to the Trustee for deposit in escrow (the "Escrowed Securities") pursuant to
the terms of this Agreement. To this end the Security Holders hereby
irrevocably mandate, direct and authorize the Issuer to deliver to the
Trustee, on behalf of the Security Holders, certificates representing 80% of
the Shares which are issued from time to time to the Security Holders as part
of the Transactions, to be held by the Trustee pursuant to the terms of this
Agreement.
3. The parties hereby agree that the Escrowed Securities and the beneficial
ownership of or any interest in them and the certificates representing them
(including any replacement securities or certificates) shall not be sold,
assigned, hypothecated, pledged, charged, alienated, released from escrow,
transferred within escrow, or otherwise in any manner dealt with, without the
express prior consent, order or direction in writing of the Exchange. The
foregoing shall not
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prevent any transfer or assignment which may be required by reason of the
bankruptcy of the Security Holders, in which case, the Trustee shall hold the
said Escrowed Securities and certificates in escrow, subject to the
provisions of this agreement, for whatever person or company shall be legally
entitled to be or become the registered owner thereof.
4. Notwithstanding paragraph 3, it is agreed that Escrowed Securities will
be automatically released from escrow from time to time as follows:
on September 20, 1996: one third of the Escrowed Securities then held
by the Trustee
on September 20, 1997: one half of the Escrowed Securities then held by
the Trustee
on September 20, 1998: the balance of the Escrowed Securities
such releases on September 20, 1996 and 1997 to be done as between the
Security Holders pro rata to the number of Escrowed Securities then held on
behalf of each of them.
5. The Security Holders hereby direct the Trustee to retain their
respective Escrowed Securities and the certificates (including any
replacement securities or certificates) representing the same and not to do
or cause anything to be done to release the same from escrow or to allow any
sale, assignment, hypothecation, pledge, charge, or alienation thereof
except, as provided in Section 4 hereof or, with the prior written consent,
order or direction of the Exchange. The Trustee accepts the responsibilities
placed on it hereby and agrees to perform the same in accordance with the
terms hereof.
6. If during the period in which any of the said Escrowed Securities are
retained in escrow pursuant hereto any cash dividend is received by the
Trustee in respect of the Escrowed Securities, any such cash dividend shall
be forthwith paid or transferred to the respective Security Holders entitled
thereto. If during the period in which any of the said Escrowed Securities
are retained in escrow pursuant hereto, any share dividend or other
distribution of securities is received by the Trustee in respect of the
Escrowed Securities, any certificates representing such share dividend or
securities must be held by the Trustee on and subject to the terms of this
agreement. If during the period in which any of the said Escrowed Securities
are retained in escrow pursuant hereto, any share dividend or other
distribution of securities is received by the Security Holders in respect of
the Escrowed Securities, any certificates representing such share dividend or
securities must be forthwith deposited with the Trustee to be held by the
Trustee on and subject to the terms of this agreement.
7. All voting rights attached to the Escrowed Securities shall at all times
be exercised by the respective beneficial owners thereof and the Trustee
shall take all necessary steps from time to time to permit the beneficial
owners to exercise such rights.
8. The Security Holders hereby agree to and do hereby release and indemnify
and save harmless the Trustee from and against all claims, suits, demands,
costs, damages and expenses
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which may be occasioned by reason of the Trustee's compliance in good faith
with the terms hereof.
9. The Issuer hereby acknowledges the terms and conditions of this
agreement and agrees to take all reasonable steps to facilitate its
performance.
10. If the Trustee should wish to resign, it shall give at least six months'
notice to the Issuer and the Exchange, whereupon the Issuer, may, with the
written consent of the Exchange, by writing appoint another Canadian trust
company as 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.
11. The written consent, order or direction of the Exchange to a release
from escrow of all or any part of the Escrowed Securities shall terminate
this agreement only in respect of those Escrowed Securities so released. For
greater certainty, this clause does not apply to Escrowed Securities
transferred within escrow.
12. The Security Holders may hypothecate, pledge or charge any or all
securities owned by them and deposited in escrow hereunder to a financial
institution, provided that prior to such hypothecation, pledge or charge,
such financial institution enters into an agreement with the Trustee and the
Issuer whereby it agrees to be bound by the provisions of this agreement and
acknowledges that the securities so hypothecated, pledged or charged may not
be sold, transferred or otherwise dealt with except in accordance with the
provisions of this agreement.
13. If the Issuer is delisted by the Exchange, thereafter any consent, order
or direction of the Exchange herein required will, instead, require the
consent, order or direction of the Quebec Securities Commission.
14. This agreement may be executed in several parts in the same form and
such parts as so executed shall together form one original agreement, and
such parts if more than one shall be read together and construed as if all
the signing parties hereto had executed one copy of this agreement.
15. Wherever the singular or masculine are used throughout this agreement,
the same shall be construed as being the plural or feminine or neuter where
the context so requires.
16. This agreement shall be construed and enforced in accordance with, and
the rights of the parties shall be governed by, the laws of the Province of
Ontario. Each of the parties hereto irrevocably attorns to the jurisdiction
of the courts of the Province of Ontario.
17. This agreement shall enure to the benefit of and be binding upon the
parties hereto, their heirs, executors, administrators, successors and
assigns.
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IN WITNESS WHEREOF, the parties hereto have executed these presents the
day and year first above written.
SIGNED, SEALED AND DELIVERED ) Xxxxxxxx Communications Ltd.
)
in the presence of )
) Per: /s/
) ________________________
)
) Xxxxxx Travel, Limited
)
)
) Per: /s/
) ________________________
)
) Intek Diversified Corporation
)
)
) Per: /s/
________________________
BROOKLINE MINERALS INC.
Per: /s/
________________________
MONTREAL TRUST COMPANY OF CANADA
Per: /s/
________________________
Per: /s/
________________________
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SCHEDULE "A"
Name of Holder: Address: Number of Certificate Number
Shares
deposited
on
September
20, 1995
Xxxxxxxx 0000 Xxxxx Xxxxxx 200,000
Communications Ltd. Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx
Xxxxxx Travel, Limited 0000 Xxxx Xxxxxx Xxxxxxxxx --
Xxxxx X000
Xxx Xxxxx, Xxxxxx
Intek Diversified 000 Xxxx 000xx Xxxxxx 200,000
Corporation Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx
