ESCROW DEPOSIT AGREEMENT

 

 

This ESCROW DEPOSIT AGREEMENT (this “Agreement”), dated as of this __ day of _____ 2016, by and among AEGIS IDENTITY SOFTWARE, INC., a [Delaware] corporation (the “Company”), having an address at 750 West Hampden Avenue, Suite 500, Englewood, Colorado 80110, ____________________________________________ (the “Underwriter”), having an address at _____________________________________, and SIGNATURE BANK (the “Escrow Agent”), a New York State chartered bank, having an office at 261 Madison Avenue, New York, New York 10016.  All capitalized terms not herein defined shall have the meaning ascribed to them in that certain Prospectus incorporated in the Registration Statement on Form S-1, originally filed with the U.S. Securities and Exchange Commission on ___________, 2016, in connection with the Company’s initial public offering of its shares of Common Stock, as amended or supplemented from time to time, including all exhibits thereto (the “Prospectus”).

W I T N E S S E T H:

WHEREAS, pursuant to the terms of the Prospectus, the Company desires to sell (the “Offering”) a minimum of $5,500,000 (the “Minimum Amount”) and a maximum of $10,000,000 (the “Maximum Amount”) of its shares of Common Stock (the “Shares”), with each Share being sold at a price of $____ per Share;

 

WHEREAS, unless the Company sells the Minimum Amount and the Shares are listed for trading on the Nasdaq Capital Market on or before sixty (60) days after the date of the Prospectus (the “Termination Date”), the Offering shall terminate and all funds shall be returned to the subscribers in the Offering, and if the Minimum Amount and Nasdaq listing are satisfied, the Offering may continue until the Termination Date;

 

WHEREAS, the Company and Underwriter desire to establish an escrow account with the Escrow Agent into which the Company and Underwriter shall instruct subscribers introduced to the Company by Underwriter (the “Subscribers”) to deposit checks and other instruments for the payment of money made payable to the order of “Signature Bank as Escrow Agent for Aegis Identity Software, Inc.,” and the Escrow Agent is willing to accept said checks and other instruments for the payment of money in accordance with the terms hereinafter set forth;

 

WHEREAS, the Company, as issuer, and Underwriter, as the sole book-running manager, represent and warrant to the Escrow Agent that they will comply with all of their respective obligations under applicable federal and state securities laws and regulations with respect to sale of the Offering;

WHEREAS, the Company and Underwriter represent and warrant to the Escrow Agent that they have not stated to any individual or entity that the Escrow Agent’s duties will include anything other than those duties stated in this Agreement; and

 

WHEREAS, the Company and Underwriter warrant to the Escrow Agent that a copy of each document that has been delivered to Subscribers and third parties that includes the Escrow Agent’s name and duties has been attached hereto as Schedule I.

NOW, THEREFORE, IT IS AGREED as follows:

 

1.           Delivery of Escrow Funds.

 

 

    (b)           The collected funds deposited into the Escrow Account are referred to as the “Escrow Funds.”

 

 

2.           Release of Escrow Funds.  The Escrow Funds shall be paid by the Escrow Agent in accordance with the following:

 

 

3.           Acceptance by Escrow Agent.  The Escrow Agent hereby accepts and agrees to perform its obligations hereunder, provided that:

 

    (a)           The Escrow Agent may act in reliance upon any signature believed by it to be genuine, and may assume that any person who has been designated by Underwriter or the Company to give any written instructions, notice or receipt, or make any statements in connection with the provisions hereof has been duly authorized to do so.  Escrow Agent shall have no duty to make inquiry as to the genuineness, accuracy or validity of any statements or instructions or any signatures on statements or instructions.  The names and true signatures of each individual authorized to act singly on behalf of the Company and Underwriter are stated in Schedule II, which is attached hereto and made a part hereof.  The Company and Underwriter may each remove or add one or more of its authorized signers stated on Schedule II by notifying the Escrow Agent of such change in accordance with this Agreement, which notice shall include the true signature for any new authorized signatories.

 

4.           Escrow Account Statements and Information. The Escrow Agent agrees to send to the Company and/or the Underwriter a copy of the Escrow Account periodic statement, upon request in accordance with the Escrow Agent’s regular practices for providing account statements to its non-escrow clients and to also provide the Company and/or Underwriter, or their designee, upon request other deposit account information, including Escrow Account balances, by telephone or by computer communication, to the extent practicable.  The Company and Underwriter agree to complete and sign all forms or agreements required by the Escrow Agent for that purpose.  The Company and Underwriter each consent to the Escrow Agent’s release of such Escrow Account information to any of the individuals designated by Company or Underwriter, which designation has been signed in accordance with Section 3(a) by any of the persons in Schedule II.  Further, the Company and Underwriter have an option to receive e-mail notification of incoming and outgoing wire transfers.  If this e-mail notification service is requested and subsequently approved by the Escrow Agent, the Company and/or Underwriter agrees to provide a valid e-mail address and other information necessary to set-up this service and sign all forms and agreements required for such service.  The Company and Underwriter each consent to the Escrow Agent’s release of wire transfer information to the designated e-mail address(es).  The Escrow Agent’s liability for failure to comply with this section shall not exceed the cost of providing such information.

 

5.           Resignation and Termination of the Escrow Agent.  The Escrow Agent may resign at any time by giving thirty (30) days’ prior written notice of such resignation to Underwriter and the Company.  Upon providing such notice, the Escrow Agent shall have no further obligation hereunder except to hold as depositary the Escrow Funds that it receives until the end of such thirty (30)-day period.  In such event, the Escrow Agent shall not take any action, other than receiving and depositing Subscribers checks and wire transfers in accordance with this Agreement, until the Company has designated a banking corporation, trust company, attorney or other person as successor.  Upon receipt of such written designation signed by Underwriter and the Company, the Escrow Agent shall promptly deliver the Escrow Funds to such successor and shall thereafter have no further obligations hereunder.  If such instructions are not received within thirty (30) days following the effective date of such resignation, then the Escrow Agent may deposit the Escrow Funds held by it pursuant to this Agreement with a clerk of a court of competent jurisdiction pending the appointment of a successor.  In either case provided for in this section, the Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds.

6.           Termination.  The Company and Underwriter may terminate the appointment of the Escrow Agent hereunder upon written notice specifying the date upon which such termination shall take effect, which date shall be at least thirty (30) days from the date of such notice.  In the event of such termination, the Company and Underwriter shall, within thirty (30) days of such notice, appoint a successor escrow agent and the Escrow Agent shall, upon receipt of written instructions signed by the Company and Underwriter, turn over to such successor escrow agent all of the Escrow Funds; provided, however, that if the Company and Underwriter fail to appoint a successor escrow agent within such thirty (30) day period, such termination notice shall be null and void and the Escrow Agent shall continue to be bound by all of the provisions hereof.  Upon receipt of the Escrow Funds, the successor escrow agent shall become the escrow agent hereunder and shall be bound by all of the provisions hereof and Escrow Agent shall be relieved of all further obligations and released from all liability thereafter arising with respect to the Escrow Funds and under this Agreement.

 

7.           Investment.  All funds received by the Escrow Agent shall be held only in non-interest bearing bank accounts at Escrow Agent.

 

8.           Compensation.  The Escrow Agent shall be entitled, for the duties to be performed by it hereunder, to a fee of $4,000, which fee shall be paid by the Company upon the signing of this Agreement.  In addition, the Company shall be obligated to reimburse Escrow Agent for all fees, costs and expenses incurred or that become due in connection with this Agreement or the Escrow Account, including reasonable attorney’s fees.  Neither the modification, cancellation, termination or rescission of this Agreement nor the resignation or termination of the Escrow Agent shall affect the right of Escrow Agent to retain the amount of any fee which has been paid, or to be reimbursed or paid any amount which has been incurred or becomes due, prior to the effective date of any such modification, cancellation, termination, resignation or rescission.  To the extent the Escrow Agent has incurred any such expenses, or any such fee becomes due, prior to any closing, the Escrow Agent shall advise the Company and the Company shall direct all such amounts to be paid directly at any such closing.

 

9.           Notices.  All notices, requests, demands and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if sent by hand-delivery, by facsimile (followed by first-class mail), by nationally recognized overnight courier service or by prepaid registered or certified mail, return receipt requested, to the addresses set forth below:

 

    If to Underwriter:

 

__________________________

__________________________

__________________________

__________________________

__________________________

 

 

Aegis Identity Software, Inc.

750 West Hampden Avenue, Suite 500

Englewood, Colorado 80110

Attention: Robert Lamvik, Chief Executive Officer

Fax: (303) 474-7892

 

    If to Escrow Agent:

 

Signature Bank

261 Madison Avenue

New York, New York 10016

Attention: Mr. Cliff Broder, Group Director and Senior Vice President

Fax: (646) 822-1359

 

10.         General.

 

 

11.         Form of Signature.  The parties hereto agree to accept a facsimile transmission copy of their respective actual signatures as evidence of their actual signatures to this Agreement and any modification or amendment of this Agreement; provided, however, that each party who produces a facsimile signature agrees, by the express terms hereof, to place, promptly after transmission of his or her signature by fax, a true and correct original copy of his or her signature in overnight mail to the address of the other party.

 

12.         No Third-Party Beneficiaries.  This Agreement is solely for the benefit of the parties and their respective successors and permitted assigns, and no other person has any right, benefit, priority, or interest under or because of the existence of this Agreement.

[Signature page follows]

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date first set forth above.

 

 

 

By:
	Name:
	Title:

 

 

 

 

 

 

 

 

 

 

OFFERING DOCUMENTS

 

 

AEGIS IDENTITY SOFTWARE, INC.

 

 

 

 

 

 

 

 

Date: ___________, 201__

Signature Bank

261 Madison Avenue

New York, New York 10016

Attention: Mr. Cliff Broder, Group Director and Senior Vice President

Dear Sirs:

In accordance with the terms of Section 2(b) of an Escrow Agreement dated as of ________ __, 2015 (the “Escrow Agreement”), by and between Aegis Identity Software, Inc. (the “Company”), ____________________ (the “Underwriter”), and Signature Bank (the “Escrow Agent”), the Company and Underwriter hereby notify the Escrow Agent that the ________ closing will be held on ___________ for gross proceeds of $_________.

 

PLEASE DISTRIBUTE FUNDS BY WIRE TRANSFER AS FOLLOWS (wire instructions attached):

 

Aegis Identity Software, Inc.:

$__________________

 

 

Very truly yours,

AEGIS IDENTITY SOFTWARE, INC.
By:
Name:
Title:

[UNDERWRITER]
By:
Name:
Title:

 

 

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