ESCROW AGREEMENT
THIS AGREEMENT is made as of the 9th day of January, 2004
AMONG:
NORTHWESTERN MINERAL VENTURES INC.
(the "ISSUER")
-and-
EQUITY TRANSFER SERVICES INC.
(the "ESCROW AGENT")
-and-
XXXXX XXXXX
(the "SECURITYHOLDER" or "YOU")
(collectively, the "PARTIES")
THIS AGREEMENT is being entered into by the Parties under National
Policy 46-201 Escrow for Initial Public Offerings (the "POLICY") in connection
with the proposed distribution (the "IPO"), by the Issuer, an emerging issuer,
of (a) a minimum of 8,000,000 common shares ("COMMON SHARES") and a maximum of
15,000,000 Common Shares; and (b) 2,000,000 Common Shares issuable upon the
exercise of 2,000,000 previously issued special warrants of the Issuer, by
prospectus.
FOR GOOD AND VALUABLE CONSIDERATION, the Parties agree as follows:
ARTICLE 1 ESCROW
1.1 Appointment of Escrow Agent
The Issuer and the Securityholder appoint the Escrow Agent to act as escrow
agent under this Agreement. The Escrow Agent accepts the appointment.
1.2 Deposit of Escrow Securities in Escrow
(a) You are depositing the securities ("ESCROW SECURITIES") listed
opposite your name in Schedule "A" with the Escrow Agent to be
held in escrow under this Agreement. You will immediately deliver
or cause to be delivered to the Escrow Agent any share
certificates or other evidence of these securities which you have
or which you may later receive.
(b) If you receive any other securities ("ADDITIONAL ESCROW
SECURITIES"):
(i) as a dividend or other distribution on escrow securities;
(ii) on the exercise of a right of purchase, conversion or
exchange attaching to escrow securities, including
securities received on conversion of special warrants;
(iii) on a subdivision, or compulsory or automatic conversion or
exchange of escrow securities; or
(iv) from a successor issuer in a business combination, if Part 6
of this Agreement applies, you will deposit them in escrow
with the Escrow Agent. You will deliver or cause to be
delivered to the Escrow Agent any share certificates or
other evidence of those additional escrow securities. When
this Agreement refers to escrow securities, it includes
additional escrow securities.
(c) You will immediately deliver to the Escrow Agent any replacement
share certificates or other evidence of additional escrow
securities issued to you.
1.3 Direction to Escrow Agent
The Issuer and the Securityholder direct the Escrow Agent to hold the escrow
securities in escrow until they are released from escrow under this Agreement.
ARTICLE 2 RELEASE OF ESCROW SECURITIES
2.1 Release Schedule for an Emerging Issuer
(a) Usual case
If the Issuer is an emerging issuer (as defined in section 3.3 of the
Policy) and you have not sold any escrow securities in a permitted
secondary offering (as defined in section 3.8 of the Policy), your
escrow securities will be released as follows:
On the date the Issuer's securities are listed 1/10 of your escrow securities
on a Canadian exchange (the "LISTING DATE")
6 months after the listing date 1/6 of your remaining escrow securities
12 months after the listing date 1/5 of your remaining escrow securities
18 months after the listing date 1/4 of your remaining escrow securities
24 months after the listing date 1/3 of your remaining escrow securities
30 months after the listing date 1/2 of your remaining escrow securities
36 months after the listing date your remaining escrow securities
*In the simplest case, where there are no changes to the escrow
securities initially deposited and no additional escrow securities, the
release schedule outlined above results
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in the escrow securities being released in equal tranches of 15% after
completion of the release on the listing date.
(b) Additional escrow securities
If you acquire additional escrow securities, those securities will be
added to the securities already in escrow, to increase the number of
remaining escrow securities. After that, all of the escrow securities
will be released in accordance with the applicable release schedule in
the tables above.
2.2 Delivery of Share Certificates for Escrow Securities
The Escrow Agent will send to the Securityholder any share certificates or other
evidence of the Securityholder's escrow securities in the possession of the
Escrow Agent released from escrow as soon as reasonably practicable after the
release.
2.3 Replacement Certificates
If, on the date the Securityholder's escrow securities are to be released, the
Escrow Agent holds a share certificate or other evidence representing more
escrow securities than are to be released, the Escrow Agent will deliver the
share certificate or other evidence to the Issuer or its transfer agent and
request replacement share certificates or other evidence. The Issuer will cause
replacement share certificates or other evidence to be prepared and delivered to
the Escrow Agent. After the Escrow Agent receives the replacement share
certificates or other evidence, the Escrow Agent will send to the Securityholder
or at the Securityholder's direction, the replacement share certificate or other
evidence of the escrow securities released. The Escrow Agent and Issuer will act
as soon as reasonably practicable.
2.4 Release upon Death
(a) If the Securityholder dies, the Securityholder's escrow securities
will be released from escrow. The Escrow Agent will deliver any
share certificates or other evidence of the escrow securities in
the possession of the Escrow Agent to the Securityholder's legal
representative.
(b) Prior to delivery the Escrow Agent must receive:
(i) a certified copy of the death certificate; and
(ii) any evidence of the legal representative's status that the
Escrow Agent may reasonably require.
ARTICLE 3 EARLY RELEASE ON CHANGE OF ISSUER STATUS
3.1 Becoming an Established Issuer
If the Issuer is an emerging issuer on the date of this Agreement and, during
this Agreement, the Issuer:
(a) lists its securities on The Toronto Stock Exchange Inc.;
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(b) becomes a TSX Venture Exchange Inc. ("TSX VENTURE") Tier 1 issuer;
or
(c) lists or quotes its securities on an exchange or market outside
Canada that its "principal regulator" under National Policy 43-201
Mutual Reliance Review System for Prospectuses and Annual
Information Forms (in Quebec under Staff Notice, Mutual Reliance
Review System for Prospectuses and Annual Information Forms) or,
if the Issuer has only filed its IPO prospectus in one
jurisdiction, the securities regulator in that jurisdiction, is
satisfied has minimum listing requirements at least equal to those
of TSX Venture Tier 1,
then the Issuer becomes an "established issuer".
3.2 Release of Escrow Securities
(a) When an emerging issuer becomes an established issuer, the release
schedule for its escrow securities changes.
(b) If an emerging issuer becomes an established issuer 18 months or
more after its listing date, all escrow securities will be
released immediately.
(c) If an emerging issuer becomes an established issuer within 18
months after its listing date, all escrow securities that would
have been released to that time, if the Issuer was an established
issuer on its listing date, will be released immediately.
Remaining escrow securities will be released in equal instalments
on the day that is 6 months, 12 months and 18 months after the
listing date.
3.3 Filing Requirements
Escrow securities will not be released under this Part until the Issuer does the
following:
(a) at least 20 days before the date of the first release of escrow
securities under the new release schedule, files with the
securities regulators in the jurisdictions in which it is a
reporting issuer:
(b) a certificate signed by a director or officer of the Issuer
authorized to sign stating:
(c) that the Issuer has become an established issuer by satisfying one
of the conditions in section 3.1 and specifying the condition, and
(d) the number of escrow securities to be released on the first
release date under the new release schedule, and
(e) a copy of a letter or other evidence from the exchange or
quotation service confirming that the Issuer has satisfied the
condition to become an established issuer; and
(f) at least 10 days before the date of the first release of escrow
securities under the new release schedule, issues and files with
the securities regulators in the jurisdictions in which it is a
reporting issuer a news release disclosing details of
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the first release of the escrow securities and the change in the
release schedule, and sends a copy of such filing to the Escrow
Agent.
3.4 Amendment of Release Schedule
The new release schedule will apply 10 days after the Escrow Agent receives a
certificate signed by a director or officer of the Issuer authorized to sign,
(a) stating that the Issuer has become an established issuer by
satisfying one of the conditions in section 3.1 and specifying the
condition;
(b) stating that the release schedule for the Issuer's escrow
securities has changed;
(c) stating that the Issuer has issued a news release at least 10 days
before the first release date under the new release schedule and
specifying the date that the news release was issued; and
(d) specifying the new release schedule.
ARTICLE 4 DEALING WITH ESCROW SECURITIES
4.1 Restriction on Transfer, etc.
UNLESS IT IS EXPRESSLY PERMITTED IN THIS AGREEMENT, YOU WILL NOT SELL, TRANSFER,
ASSIGN, MORTGAGE, ENTER INTO A DERIVATIVE TRANSACTION CONCERNING, OR OTHERWISE
DEAL IN ANY WAY WITH YOUR ESCROW SECURITIES OR ANY RELATED SHARE CERTIFICATES OR
OTHER EVIDENCE OF THE ESCROW SECURITIES. IF THE SECURITYHOLDER IS A PRIVATE
COMPANY CONTROLLED BY ONE OR MORE PRINCIPALS (AS DEFINED IN SECTION 3.5 OF THE
POLICY) OF THE ISSUER, THE SECURITYHOLDER MAY NOT PARTICIPATE IN A TRANSACTION
THAT RESULTS IN A CHANGE OF ITS CONTROL OR A CHANGE IN THE ECONOMIC EXPOSURE OF
THE PRINCIPALS TO THE RISKS OF HOLDING ESCROW SECURITIES.
4.2 Pledge, Mortgage or Charge as Collateral for a Loan
You may pledge, mortgage or charge your escrow securities to a financial
institution as collateral for a loan, provided that no escrow securities or any
share certificates or other evidence of escrow securities will be transferred or
delivered by the Escrow Agent to the financial institution for this purpose. The
loan agreement must provide that the escrow securities will remain in escrow if
the lender realizes on the escrow securities to satisfy the loan.
4.3 Voting of Escrow Securities
You may exercise any voting rights attached to your escrow securities.
4.4 Dividends on Escrow Securities
You may receive a dividend or other distribution on your escrow securities, and
elect the manner of payment from the standard options offered by the Issuer. If
the Escrow Agent receives a dividend or other distribution on your escrow
securities, other than additional escrow securities, the Escrow Agent will pay
the dividend or other distribution to you on receipt.
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4.5 Exercise of Other Rights Attaching to Escrow Securities
You may exercise your rights to exchange or convert your escrow securities in
accordance with this Agreement.
ARTICLE 5 PERMITTED TRANSFERS WITHIN ESCROW
5.1 Transfer to Directors and Senior Officers
(a) You may transfer escrow securities within escrow to existing or,
upon their appointment, incoming directors or senior officers of
the Issuer or any of its material operating subsidiaries, if the
Issuer's board of directors has approved the transfer.
(b) Prior to the transfer the Escrow Agent must receive:
(i) a certified copy of the resolution of the board of directors
of the Issuer approving the transfer;
(ii) a certificate signed by a director or officer of the Issuer
authorized to sign, stating that the transfer is to a
director or senior officer of the Issuer or a material
operating subsidiary and that any required approval from the
Canadian exchange the Issuer is listed on has been received;
(iii) an acknowledgment in the form of Schedule "B" signed by the
transferee;
(iv) copies of the letters sent to the securities regulators
described in subsection (c) accompanying the
acknowledgement; and
(v) a transfer power of attorney, completed and executed by the
transferor in accordance with the requirements of the
Issuer's transfer agent.
(c) At least 10 days prior to the transfer, the Issuer will file a
copy of the acknowledgement with the securities regulators in the
jurisdictions in which it is a reporting issuer.
5.2 Transfer to Other Principals
You may transfer escrow securities within escrow:
(a) to a person or company that before the proposed transfer holds
more than 20% of the voting rights attached to the Issuer's
outstanding securities; or
(b) to a person or company that after the proposed transfer
(i) will hold more than 10% of the voting rights attached to the
Issuer's outstanding securities, and
(ii) has the right to elect or appoint one or more directors or
senior officers of the Issuer or any of its material
operating subsidiaries.
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(c) Prior to the transfer the Escrow Agent must receive:
(i) a certificate signed by a director or officer of the Issuer
authorized to sign stating that
(ii) the transfer is to a person or company that the officer
believes, after reasonable investigation, holds more than
20% of the voting rights attached to the Issuer's
outstanding securities before the proposed transfer, or
(d) the transfer is to a person or company that:
(i) the officer believes, after reasonable investigation, will
hold more than 10% of the voting rights attached to the
Issuer's outstanding securities, and
(ii) has the right to elect or appoint one or more directors or
senior officers of the Issuer or any of its material
operating subsidiaries after the proposed transfer, and
(e) any required approval from the Canadian exchange the Issuer is
listed on has been received;
(i) an acknowledgment in the form of Schedule "B" signed by the
transferee;
(ii) copies of the letters sent to the securities regulators
accompanying the acknowledgement; and
(iii) a transfer power of attorney, executed by the transferor in
accordance with the requirements of the Issuer's transfer
agent.
At least 10 days prior to the transfer, the Issuer will file a copy of the
acknowledgement with the securities regulators in the jurisdictions in which it
is a reporting issuer.
5.3 Transfer upon Bankruptcy
(a) You may transfer escrow securities within escrow to a trustee in
bankruptcy or another person or company entitled to escrow
securities on bankruptcy.
(b) Prior to the transfer, the Escrow Agent must receive:
(i) a certified copy of either:
(1) the assignment in bankruptcy filed with the Superintendent
of Bankruptcy, or
(2) the receiving order adjudging the Securityholder
bankrupt;
(ii) a certified copy of a certificate of appointment of the
trustee in bankruptcy;
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(iii) a transfer power of attorney, completed and executed by the
transferor in accordance with the requirements of the
Issuer's transfer agent; and
(iv) an acknowledgment in the form of Schedule "B" signed by:
(1) the trustee in bankruptcy, or
(2) on direction from the trustee, with evidence of that
direction attached to the acknowledgment form,
another person or company legally entitled to the
escrow securities.
Within 10 days after the transfer, the transferee of the escrow securities will
file a copy of the acknowledgment with the securities regulators in the
jurisdictions in which the Issuer is a reporting issuer.
5.4 Transfer Upon Realization of Pledged, Mortgaged or Charged Escrow
Securities
You may transfer within escrow to a financial institution the escrow securities
you have pledged, mortgaged or charged under section 4.2 to that financial
institution as collateral for a loan on realization of the loan.
Prior to the transfer the Escrow Agent must receive:
(a) a statutory declaration of an officer of the financial institution
that the financial institution is legally entitled to the escrow
securities;
(b) a transfer power of attorney, executed by the transferor in
accordance with the requirements of the Issuer's transfer agent;
and
(c) an acknowledgement in the form of Schedule "B" signed by the
financial institution.
Within 10 days after the transfer, the transferee of the escrow securities will
file a copy of the acknowledgment with the securities regulators in the
jurisdictions in which the Issuer is a reporting issuer.
5.5 Transfer to Certain Plans and Funds
You may transfer escrow securities within escrow to or between a registered
retirement savings plan (RRSP), registered retirement income fund (RRIF) or
other similar registered plan or fund with a trustee, where the annuitant of the
RRSP or RRIF, or the beneficiaries of the other registered plan or fund are
limited to you and your spouse, children and parents, or, if you are the trustee
of such a registered plan or fund, to the annuitant of the RRSP or RRIF, or a
beneficiary of the other registered plan or fund, as applicable, or his or her
spouse, children and parents.
(a) Prior to the transfer the Escrow Agent must receive:
(i) evidence from the trustee of the transferee plan or fund, or
the trustee's agent, stating that, to the best of the
trustee's knowledge, the annuitant of the RRSP or RRIF, or
the beneficiaries of the other registered plan or fund
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do not include any person or company other than you and
your spouse, children and parents;
(ii) a transfer power of attorney, executed by the transferor in
accordance with the requirements of the Issuer's transfer
agent; and
(iii) an acknowledgement in the form of Schedule "B" signed by the
trustee of the plan or fund.
Within 10 days after the transfer, the transferee of the escrow securities will
file a copy of the acknowledgment with the securities regulators in the
jurisdictions in which the Issuer is a reporting issuer.
5.6 Effect of Transfer Within Escrow
After the transfer of escrow securities within escrow, the escrow securities
will remain in escrow and released from escrow under this Agreement as if no
transfer has occurred on the same terms that applied before the transfer. The
Escrow Agent will not deliver any share certificates or other evidence of the
escrow securities to transferees under this Part 5.
ARTICLE 6 BUSINESS COMBINATIONS
6.1 Business Combinations
This Part applies to the following ("BUSINESS COMBINATIONS"):
(a) a formal take-over bid for all outstanding equity securities of
the Issuer or which, if successful, would result in a change of
control of the Issuer;
(b) a formal issuer bid for all outstanding equity securities of the
Issuer;
(c) a statutory arrangement;
(d) an amalgamation;
(e) a merger; or
(f) a reorganization that has an effect similar to an amalgamation or
merger.
6.2 Delivery to Escrow Agent
You may tender your escrow securities to a person or company in a business
combination. At least five business days prior to the date the escrow securities
must be tendered under the business combination, you must deliver to the Escrow
Agent:
(a) a written direction signed by you that directs the Escrow Agent to
deliver to the depositary under the business combination any share
certificates or other evidence of the escrow securities and a
completed and executed cover letter or similar document and, where
required, transfer power of attorney completed and executed for
transfer in accordance with the requirements of the depositary,
and any other
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documentation specified or provided by you and required to be
delivered to the depositary under the business combination; and
(b) any other information concerning the business combination as the
Escrow Agent may reasonably request.
6.3 Delivery to Depositary
As soon as reasonably practicable, and in any event no later than three business
days after the Escrow Agent receives the documents and information required
under section 6.2, the Escrow Agent will deliver to the depositary, in
accordance with the direction, any share certificates or other evidence of the
escrow securities, and a letter addressed to the depositary that:
(a) identifies the escrow securities that are being tendered;
(b) states that the escrow securities are held in escrow;
(c) states that the escrow securities are delivered only for the
purposes of the business combination and that they will be
released from escrow only after the Escrow Agent receives the
information described in section 6.4;
(d) if any share certificates or other evidence of the escrow
securities have been delivered to the depositary, requires the
depositary to return to the Escrow Agent, as soon as practicable,
any share certificates or other evidence of escrow securities that
are not released from escrow into the business combination; and
(e) where applicable, requires the depositary to deliver or cause to
be delivered to the Escrow Agent, as soon as practicable, any
share certificates or other evidence of additional escrow
securities that you acquire under the business combination.
6.4 Release of Escrow Securities to Depositary
The Escrow Agent will release from escrow the tendered escrow securities when
the Escrow Agent receives a declaration signed by the depositary or, if the
direction identifies the depositary as acting on behalf of another person or
company in respect of the business combination, by that other person or company,
that:
(a) the terms and conditions of the business combination have been met
or waived; and
(b) the escrow securities have either been taken up and paid for or
are subject to an unconditional obligation to be taken up and paid
for under the business combination.
6.5 Escrow of New Securities
If you receive securities ("NEW SECURITIES") of another issuer ("SUCCESSOR
ISSUER") in exchange for your escrow securities, the new securities will be
subject to escrow in substitution for the tendered escrow securities if,
immediately after completion of the business combination:
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(a) the successor issuer is not an exempt issuer (as defined in
section 3.2 of the Policy);
(b) you are a principal (as defined in section 3.5 of the Policy) of
the successor issuer; and
(c) you hold more than 1% of the voting rights attached to the
successor issuer's outstanding securities. (In calculating this
percentage, include securities that may be issued to you under
outstanding convertible securities in both your securities and the
total securities outstanding.)
6.6 Release from Escrow of New Securities
As soon as reasonably practicable after the Escrow Agent receives:
(a) a certificate from the successor issuer signed by a director or
officer of the successor issuer authorized to sign
(b) stating that it is a successor issuer to the Issuer as a result of
a business combination and whether it is an emerging issuer or an
established issuer under the Policy, and
(c) listing the Securityholders whose new securities are subject to
escrow under section 6.5, the escrow securities of the
Securityholders whose new securities are not subject to escrow
under section 6.5 will be released, and the Escrow Agent will send
any share certificates or other evidence of the escrow securities
in the possession of the Escrow Agent in accordance with section
2.2.
(d) If your new securities are subject to escrow, unless subsection
(3) applies, the Escrow Agent will hold your new securities in
escrow on the same terms and conditions, including release dates,
as applied to the escrow securities that you exchanged.
(e) If the Issuer is:
(i) an emerging issuer, the successor issuer is an established
issuer, and the business combination occurs 18 months or
more after the Issuer's listing date, all escrow securities
will be released immediately; and
(ii) an emerging issuer, the successor issuer is an established
issuer, and the business combination occurs within 18 months
after the Issuer's listing date, all escrow securities that
would have been released to that time, if the Issuer was an
established issuer on its listing date, will be released
immediately. Remaining escrow securities will be released in
equal instalments on the day that is 6 months, 12 months and
18 months after the Issuer's listing date.
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ARTICLE 7 RESIGNATION OF ESCROW AGENT
7.1 Resignation of Escrow Agent
(a) If the Escrow Agent wishes to resign as escrow agent, the Escrow
Agent will give written notice to the Issuer.
(b) If the Issuer wishes to terminate the Escrow Agent as escrow
agent, the Issuer will give written notice to the Escrow Agent.
(c) If the Escrow Agent resigns or is terminated, the Issuer will be
responsible for ensuring that the Escrow Agent is replaced not
later than the resignation or termination date by another escrow
agent that is acceptable to the securities regulators having
jurisdiction in the matter and that has accepted such appointment,
which appointment will be binding on the Issuer and the
Securityholder.
(d) The resignation or termination of the Escrow Agent will be
effective, and the Escrow Agent will cease to be bound by this
Agreement, on the date that is 60 days after the date of receipt
of the notices referred to above by the Escrow Agent or Issuer, as
applicable, or on such other date as the Escrow Agent and the
Issuer may agree upon (the "resignation or termination date"),
provided that the resignation or termination date will not be less
than 10 business days before a release date.
(e) If the Issuer has not appointed a successor escrow agent within 60
days of the resignation or termination date, the Escrow Agent will
apply, at the Issuer's expense, to a court of competent
jurisdiction for the appointment of a successor escrow agent, and
the duties and responsibilities of the Escrow Agent will cease
immediately upon such appointment.
(f) On any new appointment under this section, the successor Escrow
Agent will be vested with the same powers, rights, duties and
obligations as if it had been originally named herein as Escrow
Agent, without any further assurance, conveyance, act or deed. The
predecessor Escrow Agent, upon receipt of payment for any
outstanding account for its services and expenses then unpaid,
will transfer, deliver and pay over to the successor Escrow Agent,
who will be entitled to receive, all securities, records or other
property on deposit with the predecessor Escrow Agent in relation
to this Agreement and the predecessor Escrow Agent will thereupon
be discharged as Escrow Agent.
(g) If any changes are made to Part 8 of this Agreement as a result of
the appointment of the successor Escrow Agent, those changes must
not be inconsistent with the Policy and the terms of this
Agreement and the Issuer to this Agreement will file a copy of the
new Agreement with the securities regulators with jurisdiction
over this Agreement and the escrow securities.
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ARTICLE 8 OTHER CONTRACTUAL ARRANGEMENTS
8.1 Escrow Agent Not a Trustee
The Escrow Agent accepts duties and responsibilities under this Agreement, and
the escrow securities and any share certificates or other evidence of these
securities, solely as a custodian, bailee and agent. No trust is intended to be,
or is or will be, created hereby and the Escrow Agent shall owe no duties
hereunder as a trustee.
8.2 Escrow Agent Not Responsible for Genuineness
The Escrow Agent will not be responsible or liable in any manner whatever for
the sufficiency, correctness, genuineness or validity of any escrow security
deposited with it.
8.3 Escrow Agent Not Responsible for Furnished Information
The Escrow Agent will have no responsibility for seeking, obtaining, compiling,
preparing or determining the accuracy of any information or document, including
the representative capacity in which a party purports to act, that the Escrow
Agent receives as a condition to a release from escrow or a transfer of escrow
securities within escrow under this Agreement.
8.4 Escrow Agent Not Responsible after Release
The Escrow Agent will have no responsibility for escrow securities that it has
released to the Securityholder or at the Securityholder's direction according to
this Agreement.
8.5 Indemnification of Escrow Agent
The Issuer and the Securityholder hereby jointly and severally agree to
indemnify and hold harmless the Escrow Agent, its affiliates, and their current
and former directors, officers, employees and agents from and against any and
all claims, demands, losses, penalties, costs, expenses, fees and liabilities,
including, without limitation, legal fees and expenses, directly or indirectly
arising out of, in connection with, or in respect of, this Agreement, except
where same result directly and principally from gross negligence, wilful
misconduct or bad faith on the part of the Escrow Agent. This indemnity survives
the release of the escrow securities, the resignation or termination of the
Escrow Agent and the termination of this Agreement.
8.6 Additional Provisions
(a) The Escrow Agent will be protected in acting and relying
reasonably upon any notice, direction, instruction, order,
certificate, confirmation, request, waiver, consent, receipt,
statutory declaration or other paper or document (collectively
referred to as "DOCUMENTS") furnished to it and purportedly signed
by any officer or person required to or entitled to execute and
deliver to the Escrow Agent any such Document in connection with
this Agreement, not only as to its due execution and the validity
and effectiveness of its provisions, but also as to the truth or
accuracy of any information therein contained, which it in good
faith believes to be genuine.
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(b) The Escrow Agent will not be bound by any notice of a claim or
demand with respect to this Agreement, or any waiver,
modification, amendment, termination or rescission of this
Agreement unless received by it in writing, signed by the other
Parties, and such waiver, modification, amendment, termination or
rescission is not inconsistent with the Policy, and, if the duties
or indemnification of the Escrow Agent in this Agreement are
affected, unless it has given its prior written consent.
(c) The Escrow Agent may consult with or retain such legal counsel and
advisors as it may reasonably require for the purpose of
discharging its duties or determining its rights under this
Agreement and may rely and act upon the advice of such counsel or
advisor. The Escrow Agent will give written notice to the Issuer
as soon as practicable that it has retained legal counsel or other
advisors. The Issuer will pay or reimburse the Escrow Agent for
any reasonable fees, expenses and disbursements of such counsel or
advisors.
(d) In the event of any disagreement arising under the terms of this
Agreement, the Escrow Agent will be entitled, at its option, to
refuse to comply with any and all demands whatsoever until the
dispute is settled either by a written agreement among the Parties
or by a court of competent jurisdiction.
(e) The Escrow Agent will have no duties or responsibilities except as
expressly provided in this Agreement and will have no duty or
responsibility under the Policy or arising under any other
agreement, including any agreement referred to in this Agreement,
to which the Escrow Agent is not a party.
(f) The Escrow Agent will have the right not to act and will not be
liable for refusing to act unless it has received clear and
reasonable documentation that complies with the terms of this
Agreement. Such documentation must not require the exercise of any
discretion or independent judgment.
(g) The Escrow Agent is authorized to cancel any share certificate
delivered to it and hold the Securityholder's escrow securities in
electronic, or uncertificated form only, pending release of such
securities from escrow.
(h) The Escrow Agent will have no responsibility with respect to any
escrow securities in respect of which no share certificate or
other evidence or electronic or uncertificated form of these
securities has been delivered to it, or otherwise received by it.
8.7 Limitation of Liability of Escrow Agent
The Escrow Agent will not be liable to any of the Parties hereunder for any
action taken or omitted to be taken by it under or in connection with this
Agreement, except for losses directly, principally and immediately caused by its
bad faith, wilful misconduct or gross negligence. Under no circumstances will
the Escrow Agent be liable for any special, indirect, incidental, consequential,
exemplary, aggravated or punitive losses or damages hereunder, including any
loss of profits, whether foreseeable or unforeseeable. Notwithstanding the
foregoing or any other provision of this Agreement, in no event will the
collective liability of the Escrow Agent under
14
or in connection with this Agreement to any one or more Parties, except for
losses directly caused by its bad faith or wilful misconduct, exceed the amount
of its annual fees under this Agreement or the amount of three thousand dollars
($3,000.00), whichever amount shall be greater.
8.8 Remuneration of Escrow Agent
The Issuer will pay the Escrow Agent reasonable remuneration for its services
under this Agreement, which fees are subject to revision from time to time on 30
days' written notice. The Issuer will reimburse the Escrow Agent for its
expenses and disbursements. Any amount due under this section and unpaid 30 days
after request for such payment, will bear interest from the expiration of such
period at a rate per annum equal to the then current rate charged by the Escrow
Agent, payable on demand.
ARTICLE 9 NOTICES
9.1 Notice to Escrow Agent
Documents will be considered to have been delivered to the Escrow Agent on the
next business day following the date of transmission, if delivered by fax, the
date of delivery, if delivered by hand during normal business hours or by
prepaid courier, or 5 business days after the date of mailing, if delivered by
mail, to the following:
Equity Transfer Services Inc.
Xxxxx 000, Xxxxxxxx Xxxxxxxx Centre
000 Xxxxxxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxxxx Xxxxxxxxx
Fax Number: (000) 000-0000
9.2 Notice to Issuer
Documents will be considered to have been delivered to the Issuer on the next
business day following the date of transmission, if delivered by fax, the date
of delivery, if delivered by hand during normal business hours or by prepaid
courier, or 5 business days after the date of mailing, if delivered by mail, to
the following:
Northwestern Mineral Ventures Inc.
00 Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx
X0X 0X0
Attention: Xxxxx Xxxxx
Fax Number: (000) 000-0000
15
9.3 Deliveries to Securityholders
Documents will be considered to have been delivered to the Securityholder on the
date of delivery, if delivered by hand or by prepaid courier, or 5 business days
after the date of mailing, if delivered by mail, to the address on the Issuer's
share register.
Any share certificates or other evidence of the Securityholder's escrow
securities will be sent to the Securityholder's address on the Issuer's share
register unless the Securityholder has advised the Escrow Agent in writing
otherwise at least ten business days before the escrow securities are released
from escrow. The Issuer will provide the Escrow Agent with the Securityholder's
address as listed on the Issuer's share register.
9.4 Change of Address
(a) The Escrow Agent may change its address for delivery by delivering
notice of the change of address to the Issuer and to the
Securityholder.
(b) The Issuer may change its address for delivery by delivering
notice of the change of address to the Escrow Agent and to the
Securityholder.
(c) The Securityholder may change the Securityholder's address for
delivery by delivering notice of the change of address to the
Issuer and to the Escrow Agent.
9.5 Postal Interruption
A Party to this Agreement will not mail a document it is required to mail under
this Agreement if the Party is aware of an actual or impending disruption of
postal service.
ARTICLE 10 GENERAL
10.1 Interpretation - "holding securities"
When this Agreement refers to securities that the Securityholder "holds", it
means that the Securityholder has direct or indirect beneficial ownership of, or
control or direction over, the securities.
10.2 Further Assurances
The Parties will execute and deliver any further documents and perform any
further acts reasonably requested by any of the Parties to this Agreement which
are necessary to carry out the intent of this Agreement.
10.3 Time
Time is of the essence of this Agreement.
10.4 Incomplete IPO
If the Issuer does not complete its IPO and has become a reporting issuer in one
or more jurisdictions because it has obtained a receipt for its IPO prospectus,
this Agreement will remain
16
in effect until the securities regulators in those jurisdictions order that the
Issuer has ceased to be a reporting issuer.
10.5 Governing Laws
The laws of the Province of Ontario and the applicable laws of Canada will
govern this Agreement.
10.6 Jurisdiction
The Ontario Securities Commission has jurisdiction over this Agreement and the
escrow securities.
10.7 Consent of Securities Regulators to Amendment
Except for amendments made under Part 3, the Ontario Securities Commission must
approve any amendment to this Agreement and will apply mutual reliance
principles in reviewing any amendments that are filed with it. Therefore, the
consent of the Ontario Securities Commission will evidence the consent of all
securities regulators with jurisdiction.
10.8 Counterparts
The Parties may execute this Agreement by fax and in counterparts, each of which
will be considered an original and all of which will be one agreement.
10.9 Singular and Plural
Wherever a singular expression is used in this Agreement, that expression is
considered as including the plural or the body corporate where required by the
context.
10.10 Language
This Agreement has been drawn up in the English language at the request of all
Parties. Cette convention a ete redige en anglais a la demande de toutes les
Parties.
10.11 Benefit and Binding Effect
This Agreement will benefit and bind the Parties and their heirs, executors,
administrators, successors and permitted assigns and all persons claiming
through them as if they had been a Party to this Agreement.
10.12 Entire Agreement
This is the entire agreement among the Parties concerning the subject matter set
out in this Agreement and supersedes any and all prior understandings and
agreements.
10.13 Successor to Escrow Agent
Any corporation with which the Escrow Agent may be amalgamated, merged or
consolidated, or any corporation succeeding to the business of the Escrow Agent
will be the successor of the
17
Escrow Agent under this Agreement without any further act on its part or on the
part or any of the Parties, provided that the successor is recognized as a
transfer agent by the Canadian exchange the Issuer is listed on (or if the
Issuer is not listed on a Canadian exchange, by any Canadian exchange) and
notice is given to the securities regulators with jurisdiction.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
The Parties have executed and delivered this Agreement as of the date set out
above.
SIGNED, SEALED AND DELIVERED
IN THE PRESENCE OF
"Xxx Xxxxxxx" "Xxxxx Xxxxx"
------------------------------------- ---------------------------------
WITNESS XXXXX XXXXX
Xxx Xxxxxxx
-------------------------------------
NAME OF WITNESS
EQUITY TRANSFER SERVICES INC.
PER: "Xxxxxxx Xxxxxxxxx"
---------------------------------
Name: Xxxxxxx Xxxxxxxxx
---------------------------------
Title: Vice-President
NORTHWESTERN MINERAL VENTURES INC.
PER: "Xxxxx Xxxxxx"
---------------------------------
Name: Xxxxx Xxxxxx
---------------------------------
Title: Director
PER: "Xxx Xxxxx"
---------------------------------
Name: Xxx Xxxxx
---------------------------------
Title: Director
19
SCHEDULE "A"
SECURITYHOLDER
NAME: XXXXX XXXXX
SECURITIES: NUMBER CERTIFICATE(S) (IF APPLICABLE)
Common Shares 100,000 No. 1
150,000 No. 2
150,000 No. 3
150,000 No. 4
150,000 No. 5
150,000 No. 6
150,000 Xx. 0
X-0
XXXXXXXX "X"
ACKNOWLEDGMENT AND AGREEMENT TO BE BOUND
I acknowledge that the securities listed in the attached Schedule "A" (the
"ESCROW SECURITIES") have been or will be transferred to me and that the escrow
securities are subject to an Escrow Agreement dated January 9, 2004 (the "ESCROW
AGREEMENT").
For other good and valuable consideration, I agree to be bound by the Escrow
Agreement in respect of the escrow securities, as if I were an original
signatory to the Escrow Agreement as the Securityholder.
Dated at ____________________ on __________.
Where the transferee is an individual:
SIGNED, SEALED AND DELIVERED
IN THE PRESENCE OF
---------------------------------------------- ------------------------------
WITNESS TRANSFEREE
----------------------------------------------
NAME
Where the transferee is not an individual:
SIGNED, SEALED AND DELIVERED
IN THE PRESENCE OF
----------------------------------------------
AUTHORIZED SIGNATORY
----------------------------------------------
AUTHORIZED SIGNATORY
B-1
