ESCROW AGREEMENT
THIS ESCROW AGREEMENT dated as of this _____ day of _______________, 2000
by and between Staten Island Savings Bank, a financial institution chartered
under the laws of the State of __________________ (the "Agent") and Xxxxx
Securities, Inc. ("Xxxxx Securities").
W I T N E S S E T H:
WHEREAS, HARBOUR ENTERTAINMENT, INC., a Delaware corporation (the
"Company"), is offering 1,715,000 shares of common stock (the "Shares") on a
"best efforts" basis a minimum of $8,000,000 (the "Minimum Offering") up to a
maximum of $12,000,000 (the "Maximum Offering") (collectively, the "Offering")
at a purchase price of $7.00 per share, in a registered offering (the
"Offering"), through Xxxxx Securities, as the underwriter (the "Underwriter")
pursuant to a registration statement on Form SB-2, initially filed on April 28,
2000 with the Securities and Exchange Commission (the "SEC"). All capitalized
terms not otherwise defined herein shall have the meanings given to them in the
Memorandum.
WHEREAS, the Memorandum provides that:
A. The Offering will commence on _____________, 2000 and will expire thirty
days (30) after the effective date of the registration statement for this
offering (the "Termination Date"). The Company has an option to extend the
expiration date of this offering for an additional thirty days (30);
B. The Offering is being conducted on a "best efforts" basis as to a
minimum of $8,000,000 and up to a maximum of $12,000,000. Once the minimum
dollar has been raised and accepted by the Company and the Placement Agent, they
may be released, at the mutual consent of the Company and the Underwriter, from
escrow and paid to the Company and the Underwriter, within ten business days
after the Initial Closing and each other Closing;
C. The initial closing (the "Initial Closing") of the Offering shall take
place on _____________, but not later than ten days following the Termination
Date, and subsequent closings of the Offering (if applicable) may be scheduled
at the discretion of the Company and Placement Agent, each of which shall be
deemed a "Closing".
D. Once the Company and the Underwriter have issued the Shares, an investor
shall not be entitled to a return of their investment;
E. Proceeds from the sale of the Shares shall be held in escrow by the
Agent pending a Closing on the Shares, and disbursed upon such Closing; and if a
Share is not accepted, the funds therefor will be returned to the applicable
purchaser, without interest, after the Termination Date.
NOW, THEREFORE, in consideration of the mutual promises herein contained
and intending to be legally bound, the parties hereby agree as follows:
1. Appointment of Agent. Xxxxx Securities hereby appoints Staten Island
Savings Bank as escrow agent in accordance with the terms and conditions set
forth herein, and the Agent hereby accepts such appointment.
2. Delivery of Proceeds. All checks, drafts, or other instruments received
from Investors as payment for the Securities will be delivered by Xxxxx
Securities to the Agent, made payable to Staten Island Savings Bank, as Escrow
Agent for Xxxxx Securities, Inc.("Xxxxx Securities") Xxxxx Securities will
provide the Agent with a chart setting forth, as to each investor, his name,
address, social security number or employer identification number, number of
Shares, and the amount paid in connection with such purchase. The Agent is
hereby empowered on behalf of Xxxxx Securities to endorse and collect all
checks, drafts, wire funds transfers, promissory notes or other instruments
received on account of securities purchased.
3. Agent to Hold and Disburse Funds. The Agent will hold in a special
account established for the benefit of Xxxxx Securities and disburse all funds
received by it pursuant to the terms of this Escrow Agreement, as follows:
3.1 In the event that the Agent has received funds (and such funds are
cleared within 10 days of a Closing with respect to such Shares) from the sale
of any Shares, the Agent will, on the date of the applicable Closing, pursuant
to written instructions signed by the Xxxxx Securities, pay to the Company,
and/or to any other person designated in such instructions, the proceeds
received by the Agent from the sale of such Shares.
3.2 All funds received by the Agent pursuant to the terms of this
Escrow Agreement shall be invested only in money market instruments.
3.3 If no written instructions are received by the Agent from Xxxxx
Securities relative to the admission of one or more purchasers to the Company
within 15 days of the Termination Date, the Agent will return all funds to the
purchasers, for which no written instructions were received, without interest.
4. Exculpation and Indemnification of Agent.
4.1 The Agent shall have no duties or responsibilities other than
those expressly set forth herein. The Agent shall have no duty to enforce any
obligation of any person to make any payment or delivery, or to direct or cause
any payment or delivery to be made, or to enforce any obligation of any person
to perform any other act. The Agent shall be under no liability to the other
parties hereto or to anyone else by reason of any failure on the part of any
party hereto or any maker, guarantor, endorser or other signatory of any
document or any other person to perform such person's obligations under any such
document. Except for amendments to this Agreement referred to below, and except
for instructions given to the Agent by Xxxxx Securities relating to the escrow
deposit under this Agreement, the Agent shall not be obligated to recognize any
agreement between any and all of the persons referred to herein, notwithstanding
that references thereto may be made herein and whether or not it has knowledge
thereof.
4.2 The Agent shall not be liable to the Company or to anyone else for any
action taken or omitted by it, or any action suffered by it to be taken or
omitted, in good faith and in the exercise of its own best judgment. The Agent
may rely conclusively and shall be protected in acting upon any order, notice,
demand, certificate, opinion or advice of counsel (including counsel chosen by
the Agent), statement, instrument, report or other paper or document (not only
as to its due execution and the validity and effectiveness of its provisions,
but also as to the truth and acceptability of any information therein
contained), which is believed by the Agent to be genuine and to be signed or
presented by the proper person or persons. The Agent shall not be bound by any
notice or demand, or any waiver, modification, termination or rescission of this
Agreement or any of the terms thereof unless evidenced by a writing delivered to
the Agent signed by the proper party or parties and, if the duties or rights of
the Agent are affected, unless it shall give its prior written consent thereto.
4.3 The Agent shall not be responsible for the sufficiency or accuracy of
the form of; or the execution, validity, value or genuineness of any document or
property received, held or delivered by it hereunder, or of any signature or
endorsement thereon, or for any lack of endorsement thereon, or for any
description therein; nor shall the Agent he responsible or liable to the other
parties hereto or to anyone else in any respect on account of the identity,
authority or rights of the persons executing or delivering or purporting to
execute or deliver any document or property or this Agreement. The Agent shall
have no responsibility with respect to the use or application of any funds or
other property paid or delivered by the Agent pursuant to the provisions hereof.
The Agent shall not be liable to the Company or to anyone else for any loss
which may be incurred by reason of any investment of any monies which it holds
hereunder provided the Agent has complied with the provisions of Section 3.2
hereunder.
4.4 The Agent shall have the right to assume in the absence of written
notice to the contrary from the proper person or persons that a fact or an event
by reason of which an action would or might be taken by the Agent does not exist
or has not occurred, without incurring liability to the other parties hereto or
to anyone else for any action taken or omitted, or any action suffered by it to
be taken or omitted, in good faith and in the exercise of its own best judgment,
in reliance upon such assumption.
4.5 To the extent that the Agent becomes liable for the payment of
taxes, including withholding taxes, in respect of income derived from the
investment of funds held hereunder or any payment made hereunder, the Agent may
pay such taxes. The Agent may withhold from any payment of monies held by it
hereunder such amount as the Agent estimates to be sufficient to provide for the
payment of such taxes not yet paid, and may use the sum withheld for that
purpose. The Agent shall be indemnified and held harmless against any liability
for taxes and for any penalties or interest in respect of taxes, on such
investment income or payments in the manner provided in Section 4.6. The
principal amounts deposited with the Agent shall in no way be utilized for any
of the above-mentioned purpose aud cannot be subject to any lien or encumbrances
by the Agent for any reason.
4.6 The Agent will be indemnified and held harmless by Xxxxx
Securities from and against any and all expenses, including reasonable counsel
fees and disbursements, or loss suffered by the Agent in connection with any
action, suit or other proceeding involving any claim, or in connection with any
claim or demand, which in any way, directly or indirectly, arises out of or
relates to this Agreement, the services of the Agent hereunder, the monies or
other property held by it hereunder or any income earned from investment of such
monies. The Agent shall have a lien, with the exception of the principal amounts
deposited in the escrow account, for the amount of any such expenses or loss on
the monies and other property held by it hereunder and shall be entitled to
reimburse itself from such monies or property for the amount of any such expense
or loss. Promptly after the receipt by the Agent or notice of any demand or
claim or the commencement of any action, suit or proceeding, the Agent shall, if
a claim in respect thereof is to be made against Xxxxx Securities, notify Xxxxx
Securities thereof in writing, but the failure by the Agent to give such notice
shall not relieve Xxxxx Securities from any liability which Xxxxx Securities may
have to the Agent hereunder. Notwithstanding any obligation to make payments and
deliveries hereunder, the Agent may retain and hold for such time as it deems
necessary such amount of monies or property as it shall, from time to time, in
its sole discretion, deem sufficient to indemnify itself for any such loss or
expense and for any amounts due it under Section 7.
4.7 For the purposes hereof, the term "expense or loss" shall include
all amounts paid or payable to satisfy any claim, demand or liability, or in
settlement of any claim, demand, action, suit or proceeding settled with the
express written consent of the Agent, and all costs and expenses, including, but
not limited to, reasonable counsel fees and disbursements, paid or incurred in
investigating or defending against any such claim, demand, action, suit or
proceeding.
5. Termination of Agreement and Resignation of Agent.
5.1 This Escrow Agreement shall terminate on the final disposition of
the monies and property held in escrow hereunder, provided that the rights of
the Agent and the obligations of the other parties hereto under Sections 4 and 7
shall survive the termination hereof.
5.2 The Agent may resign at any time and be discharged from its duties
as Agent hereunder by giving Xxxxx Securities at least 30 days' notice thereof
As soon as practicable after its resignation, the Agent shall turn over to a
successor escrow agent appointed by the Company all monies and property held
hereunder (less such amount as the Agent is entitled to retain pursuant to
Section 7) upon presentation of the document appointing the new escrow agent and
its acceptance thereof. If no new Agent is so appointed within the 60-day period
following such notice of resignation, the Agent may deposit the aforesaid monies
and property with any court it deems appropriate.
6. Form of Payments by Agent.
6.1 Xxxxx Securities shall inform the Agent when any payment shall be
made from the escrow account.
6.2 Any payments by the Agent to purchasers or to persons other than
the Company pursuant to the terms of this Agreement shall be made by check,
payable to the order of each respective purchaser or other person.
6.3 All amounts referred to herein are expressed in United States
Dollars and all payments by the Agent shall be made in such dollars.
7. Compensation of Agent. For services rendered, the Agent shall receive as
compensation $_______. The Agent shall also be entitled to reimbursement from
Xxxxx Securities for all expenses paid or incurred by it in the administration
of its duties hereunder, including, but not limited to, all counsel, advisors'
and Agents' fees and disbursements and all reasonable taxes or other
governmental charges.
8. Notices. All notices, requests, demands and other communications
provided for herein shall be in writing, shall be delivered by hand or by
first-class mail, shall be deemed given when received and shall be addressed to
the parties hereto at their respective addresses listed below or to such other
persons or addresses as the relevant party shall designate as to itself from
time to time in writing delivered in like manner.
If to the Company: Harbour Entertainment, Inc.
Attention: Xxxxxxx Xxxxxx
000X Xxxx Xxx
Xxxxxxxxxx, XX 00000
Tel. # 000-000-0000
with a copy to: Xxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx & Xxxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Tel.# 000-000-0000
Fax# 000-000-0000
If to the Agent: Staten Island Savings Bank
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If to Xxxxx
Securities: Xxxxx Securities, Inc.
Attention: Xxxx Xxxxx
000 Xxxx Xxxx
Xxxxxx Xxxxxx, Xxx Xxxx 00000
Tel. # (000) 000-0000
Fax. # (000) 000-0000
9. Further Assurances: From time to time on and after the date hereof,
Xxxxx Securities shall deliver or cause to be delivered to the Agent such
further documents and instruments and shall do and cause to be done such further
acts as the Agent shall reasonably request (it being understood that the Agent
shall have no obligation to make any such request) to carry out more effectively
the provisions and purposes of this Agreement, to evidence compliance herewith
or to assure itself that it is protected in acting hereunder.
10. Consent to Service of Process. Xxxxx Securities hereby irrevocably
consents to the jurisdiction of the courts of the State of New York and of any
federal court located in such State in connection with any action, suit or other
proceeding arising out of or relating to this Agreement or any action taken or
omitted hereunder, and waives personal service of any summons, complaint or
other process and agrees that the service thereof may be made by certified or
registered mail directed to Xxxxx Securities at its address for purposes of
notices hereunder.
11. Miscellaneous.
11.1 If for any reason the escrow deposit is not received by the Agent as
contemplated herein, Xxxxx Securities shall reimburse the Agent for all
expenses, including reasonable counsel fees and disbursements, paid or incurred
by it in making preparations for providing the services contemplated hereby.
11.2 This Agreement shall be construed without regard to any presumption or
other rule requiring construction against the party causing such instrument to
be drafted. The terms "hereby", "hereof', "hereto", "hereunder" and any similar
terms, as used in this Agreement, refer to the Agreement in its entirety and not
only to the particular portion of this Agreement where the term is used. The
word "person" shall mean any natural person, partnership, company, government
and any other form of business or legal entity. All words or terms used in this
Agreement, regardless of the number or gender in which they are used, shall be
deemed to include any other number and any other gender as the context may
require. This Agreement shall not be admissible in evidence to construe the
provisions of any prior agreement. The rule of ejusdem generis shall not be
applicable herein to limit a general statement, which is followed by or
referable to an enumeration of specific matters, to matters similar to the
matters specifically mentioned.
11.3 This Agreement and the rights and obligations hereunder of Xxxxx
Securities may be assigned by Xxxxx Securities only to a successor to Xxxxx
Securities' entire business. This Agreement and the rights and obligations
hereunder of the Agent may be assigned by the Agent only to a successor to its
entire business. This Agreement shall be binding upon and inure to the benefit
of each party's respective successors, heirs and permitted assigns. No other
person shall acquire or have any rights under or by virtue of this Agreement.
This Agreement may not be changed orally or modified, amended or supplemented
without an express written agreement executed by the Agent and Xxxxx Securities.
This Agreement is intended to be for the sole benefit of the parties hereto, and
(subject to the provisions of this Section 11.3) their respective successors,
heirs and assigns, and none of the provisions of this Agreement are intended to
be, nor shall they be construed to be, for the benefit of any third person.
11.4 This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York. The representations and warranties
contained in this Agreement shall survive the execution and delivery hereof and
any investigations made by any party. The headings in this Agreement are for
purposes of reference only and shall not limit or otherwise affect any of the
terms hereof.
11.5 All deposits to the escrow account are funds deposited by the
clients of Xxxxx Securities. Therefore, the Agent agrees that it can neither
place any lien or encumbrance, nor freeze the deposits of Xxxxx Securities'
clients in said escrow account.
12. Execution in Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signature of all of the parties reflected hereon as the signatures.
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the day and year first above written.
STATEN ISLAND SAVINGS BANK
By:___________________________
Name:_________________________
Title:________________________
XXXXX SECURITIES, INC.
By: _________________________________
Xxxx Xxxxx, President & CEO
