KEY BANK NATIONAL ASSOCIATION
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (the "Agreement") is made and executed this __
day of _____ , 2003, by and among PACIFIC CMA whose address is 0000 Xxxxx Xxxx
Xx. Xxxxxxx, XX 00000 and Corporate Stock Transfer, Inc. a Colorado Corporation,
(as Transfer Agent), whose address is 0000 Xxxxxx Xxxxx Xxxxx Xx. Xxxxx 000
Xxxxxx, XX 00000 (facsimile no. 303-282-5800), collectively, the "Depositors"),
and Key Bank National Association, Cherry Creek Branch ("Escrow Holder"), whose
address is 0000 X Xxxxx Xxx, Xxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx Xxxxxx
(facsimile no. (000) 000-0000).
1. Deposits. Depositors shall deposit with Escrow Holder the items
described below (collectively, the "Deposits"), which items shall be held and
disbursed in accordance with and subject to the terms and conditions of this
Agreement. The items to be deposited with Escrow Holder pursuant to this
Agreement are as follows:
Escrow Holder shall receive payments pursuant to the
Registration Statement on Form SB-2 (File 333-100045) declared effective by the
Securities and Exchange Commission, a copy of which has been delivered to Escrow
Holder. Escrow Holder will hold all Monies and other property in the Escrow
account free from any lien, claim or offset, except as set forth herein, and
such debts thereof, unless and until the conditions set forth in these
instructions to disbursement of such Monies have been fully satisfied.
Escrow Holder shall be provided the name and address of each
subscriber and amounts to be deposited into the escrow by Corporate Stock
Transfer, Inc.
2. Disbursements. The Deposits are to be disbursed by Escrow Holder to
the following persons and/or entities upon the occurrence of the following
events:
The escrow account will remain open until receipt by the Escrow Holder of
subscriptions and deposits totaling a minimum $600,000 and Escrow Holder shall
provide written notice to all parties to this agreement at such time that
collected funds of $600,000 have been deposited.
Escrow Holder will receive written instructions from Corporate Stock Transfer,
Inc., signed by Xxxxxxx X. Xxxx, President that all subscribers have been
accepted and to disburse funds. Instructions must have been preceded by
instructions from Xxxxxxx X. Xxxx specifying amounts of the outgoing
disbursements. After the minimum amount has been disbursed, deposits will
continue to be sent the Escrow Holder until the termination of the offering or
$3,600,000 total has been deposited. Funds will be disbursed from time to time
based on instructions from Corporate Stock Transfer, Inc., signed by Xxxxxxx X.
Xxxx, President. Corporate Stock Transfer agrees that it will follow all the
directions of the Company with respect to all matters regarding the acceptance
of subscriptions and the disbursment of funds held by the Escrow Holder.
3. Automatic Termination of Escrow. If any or all of the Deposits are
not disbursed by Escrow Holder pursuant to the provisions of paragraph 2 above
or otherwise withdrawn on or before [ ], subject to a 90 day
extension, Escrow Holder may mail the same to the following Depositor(s) at
their addresses as noted above.
All funds shall be returned to the subscribers referred to in paragraph 1 at a
fee of $10.00 per check payable by the company.
Upon mailing such items to the proper persons or entities pursuant to this
paragraph 3, Escrow Holder shall be relieved of and released from any and all
further obligations, duties and liability pursuant to this Agreement, and,
subject to the survival of paragraph 10 below, this Agreement immediately and
automatically shall terminate and shall be of no further force or effect.
4. Amendment. These instructions may be altered, amended, modified or
revoked by writing only, signed by all Depositors and Escrow Holder,
and upon payment of all fees, costs and expenses incident thereto.
5. Assignment. No assignment, transfer, conveyance or hypothecation of
any right, title or interest in and to any or all of the Deposits shall
be binding upon Escrow Holder unless: (a) approved in writing by all
Depositors, (b) written notice thereof shall be served upon Escrow
Holder and (c) all fees, costs and expenses incident to such
assignment, conveyance or other transfer of interest shall have been
paid.
6. Notices. Any notice required or desired to be given to any party to
this Agreement may be given either by personal delivery, or by Western
Union telegram, by facsimile transmission, or by certified mail, return
receipt requested, postage prepaid; provided, however, any notice given
by facsimile transmission, to be effective, shall be followed by
delivery of same by personal delivery or by certified mail, return
receipt requested. All such notices shall be sent to a party at its
address noted above, and such notice shall for all purposes be as
effectual as though served upon such party in person at the time of
personal delivery, or on the date of receipt in the case of
transmission by telegram, or on the date of receipt of the original, in
the case of transmission by facsimile, or two business days after the
date of deposit in the U.S. mail, as applicable.
7. Limitations on Duties. Escrow Holder shall hold and disburse the
Deposits in accordance with the terms and conditions of this Agreement.
If at any time in the performance of its duties as set forth in this
Agreement it is necessary for Escrow Holder to receive, accept or act
upon any notice or writing purported to have been executed or issued by
or on behalf of any of the parties hereto, it shall not be necessary
for Escrow Holder to ascertain whether or not the person or persons who
have executed, signed or otherwise issued or authenticated the writing
had the authority to so execute, sign or otherwise issue or
authenticate said writing, or that they are the same persons named
therein or otherwise to pass upon any requirements of such instruments
that may be essential for their validity. Further, Escrow Holder shall
have no responsibility or liability for the sufficiency or correctness
as to form, manner, execution or validity of any instrument deposited
or delivered pursuant to this Agreement, nor as to the truth or
accuracy of any information contained therein, nor as to the identity,
authority, capacity or rights of any person executing the same, nor for
the failure to comply with the provisions, requirements or conditions
of any agreement, contract or other instrument deposited with or
delivered to Escrow Holder or referred to herein. Rather, the duties of
Escrow Holder pursuant to this Agreement in all events shall be limited
to the safekeeping of the funds, documents and other items actually
received by Escrow Holder and the disposition of same in accordance
with the instructions set forth above.
8. No Liability for Actions Taken in Good Faith. Escrow Holder shall
not be personally liable for any act it may do or omit to do hereunder
while acting in good faith and in the exercise of its own subjective
best judgment, and any act done or omitted by it pursuant to the advice
of its own attorney shall be conclusive evidence of such good faith and
best judgment.
9. Notices and Warnings. Escrow Holder is hereby expressly authorized
and directed to disregard any and all notices or warnings given by any
of the parties hereto, or by any other person or entity, except as
otherwise expressly set forth in this Agreement and except for orders
or process of court, and Escrow Holder is expressly authorized to
comply with and obey any and all orders, judgments or decree of any
court. Escrow Holder shall not be liable to any of the parties hereto
or to any other person or entity by reason of compliance with any
order, judgment or decree of any court, even if such order, judgment or
decree is reversed, modified, annulled, set aside or vacated, or is
found to have been entered without jurisdiction.
10. Indemnity. In consideration of the acceptance of this escrow by
Escrow Holder, Depositors, jointly and severally, for themselves, their
heirs, executors, administrators, successors and assigns (collectively,
"Indemnitors"), covenant and agree to pay Escrow Holder its charges,
costs and expense hereunder and to indemnify and hold Escrow Holder
harmless as to any liability by it incurred to any person or entity by
reason of its having accepted the same, or in connection with any
performance by Escrow Holder in its capacity as the escrow holder
pursuant to this Agreement. Further, Indemnitors covenant and agree to
reimburse Escrow Holder for all costs and expenses, including, among
other things, counsel fees and court costs incurred in connection with
this Agreement and/or the Deposits. In case of any suit, proceeding,
cause of action, demand or other claim to which Escrow Holder is or at
any time may be a party, Indemnitors agree to pay, promptly upon Escrow
Holder's demand, any and all costs and expenses, including without
limit attorneys' fees, incurred by Escrow Holder in connection with
same. Escrow Holder shall have a first and prior lien upon the Deposits
to secure the performance of the indemnity and the other covenants of
Indemnitors pursuant to this paragraph 10, and to secure the payment of
any and all other charges, fees, costs and expenses payable to Escrow
Holder pursuant to this Agreement. Notwithstanding any contrary
provision of this Agreement, the provisions of this paragraph 10 shall
survive the expiration and/or termination of this Agreement.
11. Interpleader. If at any time a dispute shall exist as to the duty
of Escrow Holder under the terms of this Agreement, or if at any time
conflicting demands are served upon Escrow Holder, whether verbally or
in writing, concerning the possession of, title to or proceeds of any
or all of the Deposits, or if any dispute arises between or among
Depositors and/or any other person or entity relating in any way to any
item deposited, held or disbursed pursuant to or otherwise relating to
this Agreement, Escrow Holder may deposit this Agreement and the items
then or thereafter held by it pursuant to this Agreement with the Clerk
of the District Court of the City and County of Denver, State of
Colorado, and may interplead the parties hereto. Upon so depositing
this Agreement and such items and filing its complaint in interpleader,
Escrow Holder shall be relieved of and released from all liability
under the terms hereof as to the items so deposited. If the Court does
not provide for reimbursement to Escrow Holder for its attorney fees,
costs and expenses related to the interpleader action out of the
interplead funds, then Escrow Holder shall have a claim enforceable by
separate action in Court against the parties, jointly and severally,
for said attorney fees, costs and expenses.
12. FDIC Insurance. In consideration of the fee paid to Escrow Holder
as set forth in this Agreement and the covenants and agreements of
Depositors as set forth above, Escrow Holder agrees to hold the
Deposits in accordance and subject to the terms of this Agreement.
During the period the Company is in possession of the deposit, the
money will be deposited in an FDIC-insured depository (which depository
may be Escrow Holder or any other bank owned or controlled by Key
Corp.). Under no circumstances shall Escrow Holder have liability for
loss of funds due to bank, savings and loan association or other
depository failure, suspension or cessation of business, or any action
or inaction on the part of the bank, savings and loan association or
other depositor, or any delivery service transporting funds to and from
such depository.
13. Successors; No Third Party Rights. Subject to the provisions of
paragraph 5 above, this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns. This Agreement is only for the
benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns, and no other person or entity
shall be entitled to rely on, receive any benefit from or to enforce
against any party hereto any provisions of this Agreement.
14. Applicable Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Colorado.
15. Entire Agreement; Waiver. This Agreement constitutes the entire
understanding between the parties with respect to the escrow
arrangement contemplated herein, and all prior or contemporaneous oral
agreements, understandings, discussions, representations and statements
relating to said escrow are superseded by this Agreement. The waiver of
any particular condition precedent, provision or remedy provided by
this Agreement shall not constitute the waiver of any other.
16. Business Day. If any date herein set forth for the performance of
any obligation by Escrow Holder or any Depositor, or for the delivery
of any funds, instrument or notice as herein provided, is a Saturday,
Sunday or legal holiday, the compliance with such obligation or
delivery shall be deemed acceptable if effected on the next business
day following such Saturday, Sunday or legal holiday. As used herein,
the term "legal holiday" means any state or federal holiday for which
financial institutions or post offices are generally closed in the
State of Colorado for observance thereof.
17. Construction. This Agreement shall not be construed more strictly
against one party than against any other merely by virtue of the fact
that it may have been prepared by counsel for one of the parties, it
being recognized that Escrow Holder and the Depositors have contributed
substantially and materially to the preparation of this Agreement. The
headings of various paragraphs in this Agreement are for convenience
only and are not to be utilized i0 construing the content or meaning of
the substantive provisions hereof.
18. Time is of the Essence. All times, wherever specified herein, are
of the essence of this Agreement.
19. Validity. If any term or provision of this Agreement shall be held
illegal and unenforceable or inoperative as a matter of law, the
remaining terms and provisions of this Agreement shall not be affected
thereby, but each such term and provision shall be valid and shall
remain in full force and effect.
20. Escrow Holder's Representations and Warranties. The Escrow Holder
represents and warrants that (i) it is a "bank" as such term is defined
by Section 3(a)(6) of the Security Exchange Act of 1934, as amended
(the "Exchange Act") and (ii) the Deposits will only be invested
in investments permitted under Rule 15c2-4 promulgated under the
Exchange Act.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of
which shall be taken to be one and the same instrument, to the same
effect as if all of the parties hereto had signed the same signature
page. Any signature page of this Agreement may be detached from any
counterpart of this Agreement without impairing the legal effect of any
signatures thereon and may be attached to another counterpart of this
Agreement identical in form hereto but having attached to it one or
more additional signature pages.
22. Escrow Fee. The parties agree that Escrow Holder's fee for its
services pursuant to this Agreement shall be $250.00, payable in full
upon Depositors' execution of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement on the date first above written.
ESCROW HOLDER: KEY BANK NATIONAL ASSOCIATION
By:______________________________
Name: Xxxxxx Xxxxxx
Its: Vice President
DEPOSITORS: Pacific CMA, Inc.
By:_______________________________
Name: Xxxxxx Xxx
Its: Chairman
CORPORATE STOCK TRANSFER, INC.
By:________________________________
Name: Xxxxxxx X. Xxxx
Its: President
