ESCROW AGREEMENT
AGREEMENT made this _____ day of ______________ 1999 by and among the
Issuer and Continental. Stock Transfer & Trust Company (the "Escrow Agent").
W I T N E S S E T H:
WHEREAS, the Issuer has filed with the Securities and Exchange
Commission (the "Commission") a registration statement (the "Registration
Statement") covering a proposed public offering of its securities as described
on the Information Sheet;
WHEREAS, the Issuer proposes to offer the Securities for sale to the
public on a "best efforts, all or none" basis with respect to the Minimum
Securities Amount and Minimum Dollar Amount and at the price per share or other
unit all as set forth on the Information Sheet;
WHEREAS the Issuer proposes to establish an escrow account (the "Escrow
Account"), to which subscription monies which are received by the Escrow Agent
in connection with such public offering are to be credited, and the Escrow Agent
is willing to establish the Escrow Account on the terms and subject to the
conditions hereinafter set forth; and
WHEREAS, the Escrow Agent has an agreement with Chase Bank to establish
a special bank account (the "Bank Account") into which the subscription monies,
which are received by the Escrow Agent from the Issuer and credited to the
Escrow Account, are to be, deposited;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the parties hereto hereby agree as follows:
1. Information Sheet. Each capitalized term not otherwise defined in this
Agreement shall have the meaning set forth for such term on the information
sheet which is attached to this Agreement and is incorporated by reference
herein and made a part hereof (the "Information Sheet").
2. Establishment of the Bank Account.
2.1 The Escrow Agent shall establish a non-interest- bearing bank account at the
branch of Chase Bank selected by the Escrow Agent, and bearing the designation
set forth on the Information Sheet (heretofore defined as the "Bank Account").
The purpose of the Bank Account is for (a) the deposit of all subscription
monies (checks, cash or wire transfers) which are received by the Issuer from
prospective purchasers of the Securities and are delivered by the Issuer to the
Escrow Agent, (b) the holding of amounts of subscription monies which are
collected through the banking system, and (c) the disbursement of collected
funds, all as described herein.
2.2 On or before the date of the initial deposit in the Bank Account pursuant to
this Agreement,', the Issuer shall notify the Escrow Agent in writing of the
effective date of the Registration Statement (the "Effective Date"), and the
Escrow Agent shall not be required to accept any amounts for credit to the
Escrow Account or for deposit in the Bank Account prior to its receipt of such
notification.
2.3 The Offering Period, which shall be deemed to commence on the Effective
Date, shall consist of the number of calendar days or business days set forth on
the Information Sheet. The Offering Period shall be extended by an Extension
Period only if the Escrow Agent shall have received written notice thereof at
least five (5) business days prior to the expiration of the Offering Period.*
The Extension Period, which shall be deemed to commence on the next calendar day
following the expiration of the Offering Period, shall consist of the number of
calendar days or business days set forth on the Information Sheet. The last day
of the Offering Period, or the last day of the Extension Period (if the Escrow
Agent has received written notice thereof as 'hereinabove provided), is referred
to herein as the "Termination Date". Except as provided in Section 4.3 hereof,
after the Termination Date the Issuer shall not deposit, and the Escrow Agent
shall not accept, any additional amounts representing payments by prospective
purchasers.
3. Deposits to the Bank Account.
3.1 The Issuer shall promptly deliver to the Escrow Agent all monies which it
receives from prospective purchasers of the Securities, which monies shall be in
the form of checks, cash,' or wire transfers. Upon the Escrow Agent's receipt of
such monies, they shall be credited to the Escrow Account. All checks delivered
to the Escrow Agent shall be made payable to "Continental Stock Transfer & Trust
Company, as Escrow Agent for Alpha Resources, Inc." Any check payable other than
to the Escrow Agent as required hereby shall be returned to the prospective
purchaser, or if the Escrow Agent has insufficient information to do so, then to
the Issuer together with any Subscription Information, as defined below or other
documents delivered therewith) by noon of the next business day following
receipt of such check by the Escrow Agent, and such check shall be deemed not to
have been delivered to the Escrow Agent pursuant to the terms of this Agreement.
3.2 Promptly after receiving subscription monies as described in Section 3.1,
the Escrow Agent shall deposit the same into the Bank Account. Amounts of monies
so deposited are hereinafter referred to as "Escrow Amounts". The Escrow Agent
shall cause Chase Bank to process all Escrow Amounts for collection through the
banking system. Simultaneously with each deposit to the Escrow Account, the
Issuer shall inform the Escrow Agent in writing of the name and address of. the
prospective purchaser, the amount of Securities subscribed for by such
purchaser, and the aggregate dollar amount of such subscription (collectively,
the "Subscription Information).
3.3 The Escrow Agent shall not be required to accept for credit to the Escrow
Account or for deposit into the Bank Account checks which are not accompanied by
the appropriate Subscription Information. Wire transfers and cash representing
payments by prospective purchasers shall not be deemed deposited in the Escrow
Account until the Escrow Agent has received in writing the Subscription
Information required with respect to such payments.
3.4 The Escrow Agent shall not be required to accept in the Escrow Account any
amounts representing payments by prospective purchasers, whether by check, cash
or wire, except during the Escrow Agent's regular business hours.
3.5 Only those Escrow Amounts, which have been deposited in the Bank Account and
which have cleared the banking system and have been collected by the Escrow
Agent, are herein referred to as the "Fund".
3.6 If the proposed offering is terminated before the Termination Date, the
Escrow Agent shall refund any portion of the Fund prior to disbursement of the
Fund in accordance with Article 4 hereof upon instructions in writing signed by
the Issuer.
4. Disbursement from the Bank Account.
4.1 Subject to Section 4.3 below, if by the close of regular banking hours on
the Termination Date the Escrow Agent determines that the amount in the Fund is
less than the Minimum Dollar Amount or the Minimum Securities Amount, as
indicated by the Subscription Information submitted to the Escrow Agent, then in
either such case, the Escrow-Agent shall promptly refund to each prospective
purchaser the amount of payment received from such purchaser which is then held
in the Fund or which thereafter clears the banking system, without interest
thereon or deduction therefrom, by drawing checks on the Bank Account for the
amounts of such payments and transmitting them to the purchasers. In such event,
the Escrow Agent shall promptly notify the Issuer of its distribution of the
Fund.
4.2 Subject to Section 4.3 below, if at any time up to the close of regular
banking hours on the Termination Date, the Escrow Agent determines that the
amount in the Fund is at least equal to the Minimum Dollar Amount and represents
the sale of not less than the Minimum Securities Amount, the Escrow Agent shall
promptly notify the Issuer of such fact in writing. The. Escrow Agent shall
promptly disburse the Fund, by drawing checks on the Bank Account in accordance
with instructions in writing signed by the Issuer as to the disbursement of the
Fund, promptly after it receives such instructions,
4.3 [This provision applies only if a Collection Period has been provided for by
the appropriate indication on the Information Sheet.] If the Escrow Agent has on
hand at the close of business on the Termination Date any uncollected amounts
which when added to the Fund would raise the amount in the Fund to the Minimum
Dollar Amount, and result in the Fund representing the sale of the Minimum
Securities Amount, the Collection Period (consisting of the number of business
days set forth on the Information Sheet) shall be utilized to allow such
uncollected amounts to c1ear the banking system. During the Collection Period,
the Issuer shall not deposit, and the Escrow Agent shall not accept, any
additional amounts; provided, however, that such amounts as were received by the
Issuer by the close of business on the Termination Date may be deposited with
the Escrow Agent by noon of the next business day following the Termination
Date. If at the close of business on the last day of the Collection Period an
amount sufficient to raise the amount in the Fund to the Minimum Dollar Amount
and which would result in the Fund representing the sale of the Minimum
Securities Amount shall not have cleared the banking system, the Escrow Agent
shall promptly notify the Issuer in writing of such fact and shall promptly
return all amounts then in the Fund, and any amounts which, thereafter clear the
banking system, to the prospective purchasers as provided in Section 4.2 hereof.
4.4 Upon disbursement of the Fund pursuant to the terms of this Article 4, the
Escrow Agent shall be relieved of all further obligations and released from all
liability under this Agreement. it is expressly agreed and understood that in no
event shall the aggregate amount of payments made by the Escrow Agent exceed the
amount of the Fund.
5. Rights, Duties and Responsibilities of Escrow Agent. It is understood and
agreed that the duties of the Escrow Agent are purely ministerial in nature, and
that:
5.1 The Escrow Agent shall notify the Issuer, on a daily basis, of the Escrow
Amounts which have been deposited in the Bank Account and of the amounts,
constituting the Fund, which have cleared the banking system and have been
collected by the Escrow Agent.
5.2 The Escrow Agent shall not be responsible for the performance by the Issuer
of its obligations under this Agreement.
5.3 The Escrow Agent shall not be required to accept from the Issuer any
Subscription Information pertaining to prospective purchasers unless such
Subscription Information is accompanied by checks, cash, or wire transfers
meeting the requirements of Section 3.1, nor shall the Escrow Agent be required
to keep records of any information with respect to payments deposited by the
Issuer except as to the amount of such payments; however, the Escrow Agent shall
notify the Issuer within a reasonable time of any discrepancy between the amount
set forth in any Subscription Information and the amount delivered to the Escrow
Agent therewith. Such amount need not be accepted for deposit in the Escrow
Account until such discrepancy has been resolved.
5.4 The Escrow Agent shall be under no duty or responsibility to enforce
collection of any check delivered to it hereunder. The Escrow Agent, within a
reasonable time, shall return to the Issuer any check received which is
dishonored, together with the Subscription Information, if any, which
accompanied such check.
5.5 The Escrow Agent shall be entitled to rely upon the accuracy, act in
reliance upon the contents, and assume the genuineness of any notice,
instruction, certificate, signature, instrument or other document which is given
to the Escrow Agent pursuant to this Agreement without the necessity of the
Escrow Agent verifying the truth or accuracy thereof. The Escrow Agent shall not
be obligated to make any inquiry as to the authority, capacity, existence or
identity of any person purporting to give any such notice or instructions or to
execute any such certificate, instrument or other document.
5.6 If the Escrow Agent is uncertain as to its duties or rights hereunder or
shall receive instructions with respect to the Bank Account, the Escrow Amounts
or the Fund which, in its sole determination, are in conflict either with other
instructions received by it or with any provision of this Agreement, it shall be
entitled to hold the Escrow Amounts, the Fund, or a portion thereof, in the Bank
Account pending the resolution of such uncertainty to the Escrow Agent's sole
satisfaction, by final judgment of a court or courts of competent jurisdiction
or otherwise; or the Escrow Agent, at its sole option, may deposit the Fund (and
any other Escrow Amounts that thereafter become part of the Fund) with the clerk
of a court of competent jurisdiction in a proceeding to which all parties in
interest are joined. Upon the deposit by the Escrow Agent of the Fund with the
Clerk of any court, the Escrow Agent shall be relieved of all further
obligations and released from all liability hereunder.
5.7 The Escrow Agent shall not be liable for any action taken or omitted
hereunder, or for the misconduct of any employee, agent or attorney appointed by
it, except in the case of willful misconduct or gross negligence. The Escrow
Agent shall be entitled to consult with counsel of its own choosing and shall
not be liable for any action taken, suffered or omitted by it in accordance with
the advice of such counsel.
5.8 The Escrow Agent shall have no responsibility at any time to ascertain
whether or not any security interest exists in the Escrow Amounts, the Fund or
any part thereof or to file any financing statement under the Uniform Commercial
Code with respect to the Fund or any part thereof.
6. Amendment; Resignation. This Agreement may be altered or amended only with
the written consent of the Issuer and the Escrow Agent. The Escrow Agent may
resign for any reason upon three (3) business days' written notice to the
Issuer. Should the Escrow Agent resign as herein provided, it shall not be
required to accept any deposit, make any disbursement or otherwise dispose of
the Escrow Amounts or the Fund, but its only duty shall be to hold the Escrow
Amounts until they clear the banking system and the Fund for a period of not
more than five (5) business days following the effective date of such
resignation, at which time (a) if a successor escrow agent shall have been
appointed and written notice thereof (including the name and address of such
successor escrow agent) shall have been given to the resigning Escrow Agent by
the Issuer and such successor escrow agent, then the resigning Escrow Agent
shall pay over to the successor escrow agent the Fund, less any portion thereof
previously paid out in accordance with this Agreement; or (b) if the resigning
Escrow Agent shall not have received written notice signed by the Issuer and a
successor escrow agent then the resigning Escrow Agent shall promptly refund the
amount in the Fund to each prospective purchaser, without interest thereon or
deduction therefrom, and the resigning Escrow Agent shall promptly notify the
Issuer in writing of its liquidation and distribution of the Fund; whereupon, in
either case, the Escrow Agent shall be relieved of all further obligations and
released from all liability under this Agreement. Without limiting the
provisions of Section 8 hereof, the resigning Escrow Agent shall be entitled to
be reimbursed by the Issuer and the underwriter for any expenses incurred in
connection with its resignation, transfer of the Fund to a successor escrow
agent or distribution of the Fund pursuant to this Section 6.
7. Representations and Warranties. The Issuer hereby represents and warrants to
the Escrow Agent that:
7.1 No party other than the parties hereto and the prospective purchasers have,
or shall have, any lien, claim or security interest in the Escrow Amounts or the
Fund or any part thereof.
7.2 No financing statement under the Uniform Commercial Code is on file in any
jurisdiction claiming a security interest in or describing (whether specifically
or generally) the Escrow Amounts or the Fund or any part thereof.
7.3 The Subscription information submitted with each deposit shall, at the time
of submission and at the time of the disbursement of the Fund, be deemed a
representation and warranty that such deposit represents a bona fide payment by
the purchaser described therein for the amount of Securities set forth in such
Subscription Information.
7.4 All of the information contained in the Information Sheet is, as of the date
hereof, and will be, at the time of any disbursement of the Fund, true and
correct.
8. Fees and Expenses. The Escrow Agent shall be entitled to the Escrow Agent
Fees set forth on the Information Sheet payable as and when stated therein. In
addition, the Issuer agrees to reimburse the Escrow Agent for any reasonable
expenses incurred in connection with this Agreement, including, but not limited
to, reasonable counsel fees. Upon receipt of the Minimum Dollar Amount, the
Escrow Agent shall have a lien upon the Fund to the extent of its fees for
services as Escrow Agent.
9. Indemnification and Contribution.
9.1 The Issuer (the "Indemnitor") agrees to indemnify the Escrow Agent and its
officers, directors, employees, agents and shareholders (collectively referred
to as the "Indemnitees") against, and hold them harmless of and from, any and
all loss, liability, cost, damage and expense, including without limitation,
reasonable counsel fees, which the Indemnitees may suffer or incur by reason of
any action, claim or proceeding brought against the Indemnitees arising out of
or relating in any way to this Agreement or any transaction to which this
Agreement relates, unless such action, claim or proceeding is the result of the
willful misconduct or gross negligence of the Indemnitees.
9.2 If the indemnification provided for in Section 9.1 is applicable, but for
any reason is held to be unavailable, the Indemnitor shall contribute such
amounts as are just.and equitable to pay, or to reimburse the Indemnitees for,
the aggregate of any and all losses, liabilities, costs, damages and expenses,
including counsel fees, actually incurred by the Indemnitees as a result of or
in connection with, and any amount paid in. settlement of, any action, claim or
proceeding arising out of or relating in any way to any actions or omissions of
the Indemnitor.
9.3 The provisions of this Article 9 shall survive any termination of this
Agreement, whether by disbursement of the Fund, resignation of the Escrow Agent
or otherwise.
10. Governing Law and Assignment. This Agreement shall be construed in
accordance with -and governed by the laws of the State of New York and shall be
binding upon the parties hereto and their respective successors and assigns;
provided however, that any assignment or transfer by any party of its rights
under this Agreement or with respect to the Escrow Amounts or the Fund shall be
void as against the Escrow Agent unless (a) written notice thereof shall be
given to the Escrow Agent; and (b) the Escrow Agent shall have consented in
writing to such assignment or transfer.
11. Notices. All notices required to be given in connection with this Agreement
shall be sent by registered or certified mail, return receipt requested, or by
hand delivery with receipt acknowledged, or by the Express Mail service offered
by the United States Post Office, and addressed, if to the Issuer, at its
address set forth on the Information Sheet, and if to the Escrow Agent at its
address set forth above, to the attention of the Trust Department.
12. Severability. If any provision of this Agreement or the application thereof
to any person or circumstance shall be determined to be invalid or
unenforceable, the remaining provisions of this Agreement or the application of
such provision to persons or circumstances other than those to which it is held
invalid or unenforceable shall not be affected thereby and shall be valid and
enforceable to the fullest extent permitted by law.
13, Execution in Several Counterparts. This Agreement may be executed in several
counterparts or by separate instruments, and all of such counterparts and
instruments shall constitute one agreement, binding on all of the parties
hereto.
14. Entire Agreement. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings (written or oral) of the parties in
connection therewith.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the day
and year first above written.
CONTINENTAL STOCK
THE ISSUER TRANSFER & TRUST COMPANY
By:______________________ By:___________________________
ESCROW AGREEMENT INFORMATION SHEET
1. The Issuer
--------------------
Name: Alpha Resources, Inc.
Address: 000 Xxxxxxxx Xxxxxx, Xxxxx X, Xxxxxxxxxx, XX 00000,
(000) 000-0000
State of incorporation of organization: Florida
2. The Securities
-----------------------
Units, each Unit consisting of 60 shares of Common Stock
Par value: $.001
Offering price per unit: $6.00
3. Minimum Amounts Required for Disbursement of the Escrow Account
------------------------------------------------------------------------
Aggregate dollar amount which must be collected before the Escrow
Account may be disbursed to the Issuer ("Minimum Dollar Amount):
$60,000 Total amount of securities which must be subscribed for before
the Escrow Account may be disbursed to the Issuer ("Minimum Securities
Amount): $120,000
4. Plan of Distribution of the Securities
-----------------------------------------------
Offering Period: 90 calendar/business days
Extension Period, if any; 90 calendar/business days
Collection Period, if any business days
5. Title of Escrow Account:
---------------------------------
Continental Stock Transfer & Trust Company,
Escrow Agent for Alpha Resources, Inc.
6. Escrow Agent Fees
--------------------------
Amount due on execution of the Escrow Agreement
$750 and $750 upon completion of the escrow
Fee for each check disbursed pursuant to the terms of the
Escrow Agreement $_____
Fee for each check returned pursuant to the
terms of the Escrow Agreement: $_____
