IMPOUND ESCROW AGREEMENT
AGREEMENT made this 22nd day of March, 1996 by and among AVIATOR ALES, INC.
(THE "ISSUER") and FIRST INTERSTATE BANK OF CALIFORNIA (THE "ESCROW AGENT"),
whose addresses appear on the Information Sheet (as defined herein) attached to
this Agreement.
WITNESSETH:
WHEREAS, the Issuer has prepared a Prospectus covering a proposed public
offering of it common stock, as describe on the Information Sheet; and
WHEREAS, the Issuer proposes to establish an escrow account with the Escrow
Agent in connection with such public offering and the Escrow Agent is willing
establish such escrow amount on the terms and subject to the conditions
hereinafter set forth;
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 part thereof.
2. ESTABLISHMENT OF THE ESCROW ACCOUNT
2.1 The parties hereto shall establish an escrow account at the
office of the Escrow Agent bearing the designation set forth on the Information
Sheet (the "Escrow Account").
2.2 The Offering Period shall be deemed to commence on the Effective
Date and shall continue until May ___, 1997. The Escrow Agent shall not accept
any amounts representing payments by subscribers received by the Escrow Agent
after the Termination Date.
3. DEPOSITS IN THE ESCROW ACCOUNT
3.1 All amounts received from subscribers of the Securities shall be
in full payment for shares purchased and shall be in U.S. dollars in the form of
checks, draft or money orders or wire transfer of immediately available funds to
First Interstate Bank of California, Stock Transfer Department, as the Escrow
Agent, representing the payment of money. All checks deposited into the Escrow
Account shall be made payable to "First Interstate Bank--Aviator Ales." Any
check payable other than to the Escrow Agent as required hereby may be mailed to
the subscriber by the next business day following receipt of such cheek by the
Escrow
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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 Simultaneously with each deposit into the Escrow Account, the
subscriber shall complete the Subscription Agreement (and all supporting
documents), informing the Escrow Agent in writing of the name, address, and tax
identification number, if applicable, of the subscriber, the number of
Securities subscribed for such subscriber, and the aggregated dollar amount of
such subscription.
3.3 The Escrow Agent shall not be required to accept for deposit into
the Escrow account checks which do not represent payment in full of the shares
purchased and a properly executed Subscription Agreement (and all supporting
documents). 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 Agreement (and all supporting documents) required with
respect to such payments.
3.4 The Escrow Agent shall not be required to accept any amounts
representing payments by subscribers, whether by check, draft, or money order,
except during the Escrow Agent's regular banking hours.
3.5 Amounts deposited in the Escrow Account are herein referred to as
the "Fund." The Escrow Agent shall immediately thereafter deposit the funds in
a trust savings account.
3.6 The Escrow Agent shall promptly refund to each subscriber the
amount of payment received from such subscriber, together with interest earned
thereon, prior to disbursement of the Fund in accordance with Section 4 hereof,
upon the written instructions of the Issuer.
4. DISBURSEMENT FROM THE ESCROW ACCOUNT
4.1 In the event that at the close of regular banking hours on the
expiration date of the Offering Period the amount in the Fund shall be less than
the Required Amount, then the Escrow Agent shall promptly notify each subscriber
that the offering contemplated hereby did not close and refund to each
subscriber the amount of payment received from such subscriber, together with
interest earned thereon, and the Escrow Agent shall notify the Issuer of its
distribution of the Fund. Provided, however, that no such notification or
distribution shall be made by the Escrow Agent in the event that the Escrow
Agent shall have been notified of an extension of the Offering Period in writing
as set forth in Subsection 2.2 hereof. In such event, the Escrow Agent shall
notify each subscriber by first class mail of the extension and shall hold the
Fund until the Termination Date.
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4.2 In the event that at any time up to the close of banking hours on
the expiration date of the Offering Period, or the Extended Offering Period as
the case may be, the amount in the Fund shall be at least equal to the Required
Amount, the Escrow Agent shall immediately notify the Issuer of such fact in
writing. The Escrow Agent shall hold the Fund until the Escrow Agent receives,
at least one (1) business day prior to the date of which the Fund is to be
disbursed, instructions in writing signed by the Issuer as to the disbursement
of the Fund to the Issuer. The Escrow Agent will promptly notify each
subscriber that the offering contemplated hereby has closed. The Escrow Agent
reserves the right to deduct any unpaid fees and expenses from income earned on
invested funds prior to any disbursement.
4.3 With respect to subscriptions not accepted by the Issuer, whether
by reason of the Issuer's decision to limit the number of Shares sold to any
person or by reason of the offering becoming fully subscribed prior to the
Escrow Agent's receipt of such subscription, the Escrow Agent shall follow the
instructions of the Issuer with respect to refunding to each subscriber the
payments made.
4.4 Upon disbursement of the Fund interest pursuant to the terms of
this Section 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, together with interest thereon.
5. RIGHTS, DUTIES AND RESPONSIBILITIES OF ESCROW AGENT. It is understood
and agreed that the duties of the Escrow Agent are purely administrative in
nature, and that:
5.1 The Escrow Agent shall not be responsible for the performance by
the Issuer of its obligations under this Agreement.
5.2 The Escrow Agent shall not be required to accept any Subscription
Agreement pertaining to a subscriber unless such Subscription Agreement is
accompanied by a check, draft, money order, or wire transfer of immediately
available funds to First Interstate Bank of California, as Escrow Agent, Escrow
Agent shall keep records of the amount and dates of such payments along with
each subscribers name, address and amount subscribed. Escrow Agent shall
transmit this information to issuer on a regular basis. However, the Escrow
Agent shall notify any subscriber, within a reasonable time, of a discrepancy
between the amount set forth in any Subscription Agreement and the payment
delivered to the Escrow Agent therewith Such payment need not be accepted for
deposit in the Escrow Account until such discrepancy has been resolved.
5.3 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 subscriber any check received
which is dishonored, together with the Subscription Agreement, if any, which
accompanied such check. In the event that any check received by First
Interstate Bank hereunder is returned unpaid by the drawee bank, First
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Interstate Bank may deduct from the funds held hereunder the amount of said
check together with an amount representing the interest payable on said amount
for the period during which said funds were credited hereunder and shall notify
Issuer of such occurrence.
5.4 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.
5.5 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 Escrow Agent's willful misconduct or
negligence.
5.6 The Escrow Agent shall provide to each subscriber, by January 31,
1995, a completed Form 1099 with respect to the interest payable to each
subscriber, if any.
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 thirty (30) business days' written notice to the
Issuer. Should the Escrow Agent resign as herein provided, after the effective
date of such resignation it shall not be required to accept any deposit, make
any disbursement or otherwise dispose of the Fund, but its only duty shall be to
hold 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 by the Issuer 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 (together with interest thereon), 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 (together with interest thereon) to each subscriber, and
the resigning Escrow Agent shall 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 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.
Should the parties not designate a successor agent within 30 days of the Escrow
Agents's resignation, or should any dispute arise with respect to the agreement
or the escrowed property, Escrow Agent may deposit the property in a court of
competent jurisdiction and interplead such dispute and the parties will hold
Escrow Agent harmless and indemnify it against all consequences and expenses
which may be incurred.
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7. REPRESENTATION AND WARRANTIES. The Issuer represents and warrants to
the Escrow Agent that:
7.1 No party other than the parties hereto and the subscribers have,
or shall have, any lien, claim or security interest in the Fund or any part
thereof.
7.2 All of the information contained in the Information Sheet is, as
of the date hereof, and will be at the time of disbursement of the Fund, true
and correct.
8. FEES AND EXPENSES. The Escrow Agent shall be entitled to the escrow
agent fee agreed to by the parties, payable upon execution of this Agreement.
In addition, the Issuer agrees to reimburse the Escrow Agent for any reasonable
expenses incurred in connection with this Agreement, including, but no limited
to, reasonable counsel fees.
9. INDEMNIFICATION AND CONTRIBUTION
9.1 Notwithstanding the provisions of paragraph 8, the Issuer agrees
to indemnify the Escrow Agent and its officers, directors, employees, agents and
shareholders (jointly and severally the "Indemnitees") and the Issuer agrees to
hold them harmless 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 or
threatened 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
negligence of the Indemnitees.
9.2 The provisions of this Section 9 shall survive any termination of
this agreement, whether by disbursement of the Fund, resignation of the Escrow
Agent or otherwise.
9.3 The Issuer will not make any reference to First Interstate Bank,
in connection with the offering except with respect to its role as Escrow Agent
hereunder and its role as transfer agent and registrar and in no event will the
Issuer state or imply that the Escrow Agent has investigated or endorsed the
offering in any manner whatsoever.
10. GOVERNING LAND ASSIGNMENT. This Agreement shall be construed in
accordance with and governed by the laws of California. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns.
11. NO DUTY TO PAY TAXES. The Escrow Agent shall have no duty or
responsibility to pay any federal, state or local income taxes on any escrowed
property or to make or file any tax returns or other governmental reports. The
escrowed property shall be considered to be the property of the respective
investor for all tax purposes.
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12. NOTICES. All notices required to be given to the Issuer or the Escrow
Agent 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 Federal Express offered at their respective addresses set forth on the
Information Sheet, and if to the Escrow Agent, at the address set forth above,
to the attention Of the Stock Transfer Department.
13. 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 the person 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.
14. CERTIFICATE OF AUTHORIZATION OF OFFICERS. The officers named on this
certificate have been duly elected, are now acting and are qualified to sign
written instructions, consents, stock certificates or other securities as
provided in the Bylaws, etc., on behalf of this Corporation, that the specimen
signatures appearing opposite the names and titles are the genuine signatures of
such officers and that said resolutions electing these officers are now in full
force and effect. Escrow Agent is further authorized to recognize these
signatures until escrow agent receives issuer's written instructions to the
contrary.
(Print) (Signature)
James W. Bernau Chairman of the Board, will sign
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/s/ James W. Bernau
-----------------------
James W. Bernau President, will sign /s/ James W. Bernau
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Vice President, will sign
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Treasurer, will sign
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Secretary, will sign
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15. 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.
16. 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 herewith.
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17. REFERENCE TO ESCROW AGENT. The Company will not make any reference to
First Interstate Bank, Ltd. in connection with the offering except with respect
to its role as Escrow Agent hereunder, and in no event will the Partnership
state or imply that Escrow Agent has investigated or endorsed the offering in
any manner whatsoever.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
day and year first above written.
AVIATOR ALES, INC.
By: /s/ James W. Bernau
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James W. Bernau
FIRST INTERSTATE BANK OF CALIFORNIA
By: /s/ Jack Kirby
-----------------------------------
Jack Kirby
By:
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IMPOUND ESCROW AGREEMENT INFORMATION SHEET
1. ACCOUNT TO BE AN ESCROW ACCOUNT FOR A PUBLIC OFFERING.
2. THE ISSUER: Aviator Ales, Inc.
14316 N.E. 203rd Street
Woodinville, Washington 98072
Attn: James W. Bernau, President
3. THE OFFERING:
(a) The Securities: Common Stock, $0.001 Par Value
(b) Offering Amount: 820,000 Shares
(c) Price Per Unit: $1.85
(d) Required Amount: $650,000 From a Minimum of 15 Shareholders
(e) Minimum Investment: 300 Shares - $555 at $1.85 a Share
(f) Maximum Investment: 30,000 Shares
4. PLAN OF DISTRIBUTION OF THE SECURITIES:
(a) Offering Period: Commencing on the Effective Date, and
Continuing until May ___, 1997
(b) Termination Date: The Date the Offering Period Terminated
5. EFFECTIVE DATE:
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6. THE ESCROW ACCOUNT:
(a) Title of the Escrow Account: Aviator Ales, Inc.
(b) Escrow Agent: First Interstate Bank of California
Date:
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RECEIPT OF "THE ESCROW AGREEMENT
THE ISSUER AVIATOR ALES, INC. SHEET" CONFIRMED
By: /s/ James W. Bernau Date:
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James W. Bernau, President
THE ESCROW AGENT
By: /s/ Jack Kirby
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Jack Kirby