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EXHIBIT (i)
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ESCROW AGREEMENT
(Public Offering)
AGREEMENT made this _______ day of _______________, 1996 by and among
the Issuer and the Underwriter whose names and addresses appear on the
Information Sheet (as defined herein) attached to this Agreement 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 Underwriter proposes to offer the Securities, as agent for
the Issuer, 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 and the Underwriter propose to establish an escrow
account (the "Escrow Account"), to which subscription monies which are received
by the Escrow Agent from the Underwriter 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 Chemical Bank to
establish a special bank account (the "Bank Account") into which the
subscription monies, which are received by the Escrow Agent from the Underwriter
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 Chemical 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 Underwriter from prospective purchasers of the Securities and are
delivered by the Under-writer 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.
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2.2 On or before the date of the initial deposit in the Bank
Account pursuant to this Agreement, the Underwriter 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 Underwriter 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 Underwriter 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 the offering by
[the Issuer]." 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 Underwriter (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 Chemical Bank to process all Escrow Amounts for
collection through the banking system. Simultaneously with each deposit to the
Escrow Account, the Underwriter (or the Issuer, if such deposit is made by 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.
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3.4 The Escrow Agent shall not be required to accept in the
Escrow Account any amounts representing payment by prospective purchasers,
whether by check, cash or wire transfer, 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 both the Issuer and the Underwriter.
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 and
the Underwriter 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 and the Underwriter 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
both the Issuer and the Underwriter 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 or the Underwriter 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 clear the banking
system. During the Collection Period, the Underwriter (and 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 Underwriter (or 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
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and the Underwriter 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 Underwriter, 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 or be
required to enforce any of the terms or conditions of the underwriting agreement
or any other agreement between the Underwriter and the Issuer nor shall the
Escrow Agent be responsible for the performance by the Underwriter or the Issuer
of their respective obligations under this Agreement.
5.3 The Escrow Agent shall not be required to accept from the
Underwriter (or 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 Underwriter (or the Issuer) except as to
the amount of such payments; however, the Escrow Agent shall notify the
Underwriter 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 Underwriter 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
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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, the Underwriter and the Escrow
Agent. The Escrow Agent may resign for any reason upon three (3) business days'
written notice to the Issuer and the Underwriter. 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, the Underwriter 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, the Underwriter 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 and the Underwriter 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 and the Underwriter
hereby jointly and severally represent and warrant to the Escrow Agent that:
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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 and the Underwriter jointly and severally agree
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 and the Underwriter (collectively referred to
as the "Indemnitors") jointly and severally agree 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 Indemnitors 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 Indemnitors.
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
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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 or the Underwriter, at their respective addresses 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.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
THE ISSUER:
[NAME OF ISSUER]
By:
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Name:
Title:
THE UNDERWRITER:
[NAME OF UNDERWRITER]
By:
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Name:
Title:
CONTINENTAL STOCK TRANSFER &
TRUST COMPANY
By:
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Name:
Title:
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ESCROW AGREEMENT INFORMATION SHEET
1. THE ISSUER
Name:
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Address:
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State of incorporation of organization:
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2. THE UNDERWRITER
Name:
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Address:
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State of incorporation of organization:
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3. THE SECURITIES
Description of the Securities to be offered (e.g., shares of or
warrants for common stock, debentures, units consisting of
shares and warrants, etc.):
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Par value, if any:
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Offering price per share/unit/other:
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4. 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"): $
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Total amount of securities which must be subscribed for before the
Escrow Account may be disbursed to the issuer ("Minimum
Securities Amount"): $
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5. PLAN OF DISTRIBUTION OF THE SECURITIES
Offering Period: calendar/business days
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Extension Period, if any: calendar/business days
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Collection Period, if any: business days
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6. TITLE OF ESCROW ACCOUNT
Continental Stock Transfer & Trust Company, Escrow Agent for the
offering by
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7. ESCROW AGENT FEES
Amount due on execution of the Escrow Agreement: $
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and upon completion of the escrow: $
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Fee for each check disbursed pursuant to the terms of the Escrow
Agreement: $
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Fee for each check returned pursuant to the terms of the Escrow
Agreement: $
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