PROCEEDS ESCROW AGREEMENT
Agreement entered on the day of 19 by
and among Front Range Assisted Living, L.L.C. ("Issuer"), MMR Investment
Bankers, Inc. ("Dealer"), and Colonial Trust Company, an Arizona Trust Company
and bank, as defined by Section 3(a)(6) of the Securities and Exchange Act of
1934, (the "Escrow Agent").
WHEREAS, with the assistance of Dealer, the Issuer proposes to offer and
sell up to $2,500,00 aggregate principal amount of its Church Bonds (the
"Bonds") to be issued under a Trust Indenture between the Issuer and Colonial
Trust Company Trustee (the "Trustee").
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. The Escrow Agent agrees to act as escrow agent in connection with
the offering and sale of Bonds and, as such, to establish an appropriate account
and to receive the proceeds from the sale of the Bonds for deposit therein
until the earlier of the termination of this Agreement or the termination of the
offering and sale of the Bonds (the "Termination Date").
2. Checks or other items for the payment of all or a part of the
purchase price of Bonds (all Such items together with all proceeds thereof, the
"Escrowed Property") shall be payable to Escrow Agent, or endorsed by the Dealer
or Issuer to Colonial Trust Company and delivered daily to Escrow Agent. The
Escrow Agent will credit the proceeds to an escrow cash account (the "Escrow
Account") to be held by it under the terms of this Agreement subject to Rule
15c2-4 under the Securities Act of 1934. All subscribers, checks or other items
for the payment of the purchase price of Bonds shall be transmitted by Dealer to
the Escrow Agent by noon of the next business day upon receipt by Dealer.
The Escrow Agent shall invest such collected funds deposited in the
Escrow Account in short term investments to the extent permitted by the Arizona
Department of Banking in accordance with the Arizona Revised Statutes, provided
however, that any such funds held subject to any minimum escrow contingency
shall be invested subject to rule 15c2-4. The Escrow Agent shall in no event be
liable for any loss resulting from any change in interest rates applicable to
funds so invested.
Interest on funds invested pursuant to this Section shall accrue
from the date of investment of such funds until such funds are released from
escrow pursuant to paragraph 4.
3. The Escrowed Property, together with all interest earned thereon,
shall be held by the Escrow Agent until the earlier of
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(a) the time that the Escrow Agent has received proceeds from the sale of the
Bonds in the aggregate principal amount of $300,000 or more, or (b) the date of
April 1, 1998 at which time the escrow will terminate.
4. Upon termination of the escrow, the Escrow Agent shall release the
Escrowed Property, together with all interest earned thereon to be distributed
to either (a) the Issuer, or such other party or parties, as required to carry
out the purpose of the Bond offering if the minimum amount of the Bonds have
been sold within the required time period described above, or (b) the
subscribers if the minimum amount of Bonds have not been sold within such
period.
5. The Issuer agrees that in the event the minimum amount of the Bonds
have not been sold within the time period described above, therefore
necessitating the distribution by the Escrow Agent of the Escrow Property and
the interest earned thereon to the subscribers, Issuer shall promptly pay to the
Escrow Agent such sum of money as shall be necessary, if any, when added to the
amount of the Escrow Property and interest earned thereon to pay to the
subscribers of the Bonds the principal amount of such subscriptions together
with the interest from the date of authentication through the escrow termination
date at the rate attributable to the Bonds subscribed.
6. If at any time prior to the completion of this escrow said Escrow
Agent is advised by the appropriate securities or state agency that the
registration to sell said bonds has been revoked, said Escrow Agent shall
thereupon return all funds to the respective subscribers.
7. Escrow Agent shall hold the Escrowed Property in trust, commingled
with similar funds of other Issuers, but shall maintain detailed records to
reflect the share thereof attributable to each Issuer. Escrow Agent shall
furnish periodic statements to Issuer reflecting all receipts and disbursements
from the Escrow Account.
8. The Escrow Agent's and Dealer's obligations and duties in
connections herewith are confined to those specifically enumerated in this
Agreement. The Escrow Agent and Dealer shall not be in any manner liable or
responsible for the sufficiency, correctness, genuineness or validity of any
instruments received by or deposited with them or with reference to the form of
execution thereof, or the identity, authority or rights of any person executing,
delivering, or depositing same, and neither the Escrow Agent nor the Dealer
shall be liable for any loss that may occur by reason of forgery, false
representation or the exercise of their discretion in any particular manner or
for any other reason, except for their own gross negligence or willful
misconduct.
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9. Escrow Agent shall receive compensation for its services as set
forth in the separate schedule of fees as made a part hereof by reference.
10. The Escrow Agent may act pursuant to the written advice of counsel
with respect to any matter relating to this Escrow Agreement and shall not be
liable for any action taken or omitted in accordance with such advice.
11. The Escrow Agent (and any other successor escrow agent) may at any
time resign as such by delivering all of the Escrowed Property to the successor
escrow agent jointly designated by the other parties hereto in writing, or to
any court of competent jurisdiction, whereupon the Escrow Agent shall be
discharged of and from any and all further obligations arising in connection
with this Escrow Agreement. The resignation of the Escrow Agent will take
effect on the earlier of (a) the appointment of a successor (including a court
of competent jurisdiction), or (b) the day which is thirty (30) days after the
date of delivery of its written notice of resignation to the other parties
hereto. If at that time the Escrow Agent has not received a designation of a
successor escrow agent, the Escrow Agent's sole responsibility after that time
shall be to safekeep the Escrowed Property until receipt of a designation of
successor escrow agent or a written disposition instruction by the Issuer and
Dealer or a final order of a court of competent jurisdiction.
12. If any controversy arises between the parties hereto or with any
third person, the Escrow Agent shall not be required to determine the same or to
take any action but may await the settlement of any such controversy by final
appropriate legal proceeding, or otherwise as the Escrow Agent may require, or
the Escrow Agent may, in its discretion, institute such appropriate interpleader
or other proceedings in connection therewith as it may deem proper,
notwithstanding anything in this Agreement to the contrary. In any such event,
the Escrow Agent shall not be liable for interest or damages to the Issuer or
subscribers. In the event Escrow Agent should institute, or be named as a party
in, any legal proceedings to determine the lawful owner of the Escrowed
Property, Escrow Agent shall be entitled to recover from the contending parties
to said legal proceedings, reasonable attorney's fees and expenses which shall
be incurred by Escrow Agent in said proceedings.
13. This Escrow Agreement shall be binding upon and inure solely to the
benefit of the parties hereto and their respective successors and assigns,
heirs, administrators, and representatives and shall not be enforceable by or
inure to the benefit of any third party except as provided in Section 10 with
respect to a resignation by the Escrow Agent. No party may assign any of its
rights or obligations under this Escrow Agreement without the written consent of
the other parties. This Escrow Agreement shall
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be construed in accordance with and governed by the laws of the State of Arizona
without regard to conflict of law principals.
14. This Escrow Agreement may only be modified in writing signed by all
of the parties hereto, and no waiver hereunder shall be effective unless in
writing signed by the party to be charged.
IN WITNESS WHEREOF, the parties hereto have executed this agreement as of
the day and year first above written.
DEALER: MMR Investment Bankers, Inc.
BY:
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Date:
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ISSUER:
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By:
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President or Chairman of Trustees
By:
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Secretary of Trustees
By:
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Trustee
Date:
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ESCROW AGENT: Colonial Trust Company
Phoenix, Arizona
By:
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Date:
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escroagr.ctc
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