Exhibit 10.4
 
 
ESCROW AGREEMENT

THIS ESCROW AGREEMENT (the "Agreement") made this 15th day of February, 2018

 BETWEEN:

BLOCKCHAIN MINING SUPPLY & SERVICES LTD.
a corporation incorporated under the laws of the Province of Ontario
(the "Vendor")

- and -
RIOT BLOCKCHAIN, INC.
a corporation incorporated under the laws of the State of Nevada
(the "Purchaser")

-and-
ROSEN AND KIRSHEN PROFESSIONAL CORPORATION
a professional corporation incorporated under the laws of the Province of
Ontario
(the "Escrow Agent")

RECITALS

WHEREAS pursuant to the provisions of the Asset Purchase Agreement dated as at
February 15, 2018 (the "Asset Purchase Agreement"), among the Vendor and the
Purchaser, the Purchaser has agreed to purchase from the Vendor certain assets
being 3,000 Bitmain Antminer S9 model & 3,000 PSU more fully described on
Schedule I to the Asset Purchase Agreement (the "Assets");

AND WHEREAS under the terms of the Asset Purchase Agreement, the sum of SEVEN
MILLION ($7,000,000 USD) US DOLLARS of the Purchase Price as defined in the
Asset Purchase Agreement (the "Escrow Amount") is to be deposited in an escrow
account with the Escrow Agent;

AND WHEREAS the Asset Purchase Agreement provides that the Escrow Agent shall
hold and administer the Escrow Amount in accordance with the terms of this
Agreement;

AND WHEREAS the execution and delivery of this Agreement is a condition
precedent to the obligations under the Asset Purchase Agreement.

NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the mutual
covenants and agreements set out herein, the parties respectively covenant and
agree as follows.

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1.
Delivery of Escrow Amount

 
On February 15, 2018, the Purchaser shall deposit the Escrow Amount in escrow
with the Escrow Agent, to be held and administered in accordance with the terms
and conditions of this Agreement.
 
2.
Administration

 
The Escrow Agent shall hold and safeguard the Escrow Amount, until the
Termination Date (as defined below), and shall administer, hold and dispose of
such Escrow Amount only in accordance with the terms of this Agreement.
 
3.
Payment of Escrow Amount

 
The Escrow Amount shall be payable by the Purchaser to the account of the Escrow
Agent (the "Escrow Account") set out in Schedule "A" to this Agreement.

4.
Termination of Escrow Agreement and Release of Funds

 
The Escrow Funds shall be released from the Escrow Agent to Vendor at such time
when the Assets are retrieved by Purchaser from its present location municipally
known as 191 Superior Blvd, in the City of Mississauga, Ontario L5T 2L6.
Purchaser shall send written notice to the Vendor advising of such date and time
when the Assets are retrieved in full. Notwithstanding, the release of the
Escrow Amount shall be no more than seven days (7) days from the date of
February 15, 2018. If no written notice by Purchaser is sent to Vendor advising
of retrieval or if Assets are not physically retrieved within seven (7) days of
the February 15, 2018 then on the eighth (8) day the Escrow Funds shall be
released from Escrow Agent to the Vendor.

5.
Provisions Regarding the Escrow Agent

 
5.1    In performing any duties under this Agreement, the Escrow Agent shall not
be liable to any party for damages, losses, or expenses, except for gross
negligence or willful misconduct on the part of the Escrow Agent. The Escrow
Agent shall not incur any liability for (i) any act or failure to act made or
omitted in good faith or (ii) any action taken or omitted in reliance on any
instrument, including any written statement or affidavit provided for in this
Agreement that the Escrow Agent shall, in good faith, believe to be genuine, nor
will the Escrow Agent be liable or responsible for forgeries, fraud,
impersonations, or determining the scope of any representative authority,
provided that the Escrow Agent believed, in good faith, that such forgeries,
fraud, or impersonations were genuine and acted without gross negligence or
willful misconduct. In addition, the Escrow Agent may consult with legal counsel
in connection with the Escrow Agent's duties under this Agreement and shall be
fully protected in any act taken, suffered, or permitted by it in good faith and
in accordance with the advice of counsel. The Escrow Agent is not responsible
for determining and verifying the authority of any person acting or purporting
to act on behalf of any party to this Agreement.

   

 
 
 

 
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5.2          If any controversy arises between the parties to this Agreement, or
with any other party, concerning the subject matter of this Agreement, its terms
or conditions, the Escrow Agent will not be required to determine the
controversy or to take any action regarding it. The Escrow Agent may hold all
documents and funds and may wait for settlement of any such controversy. The
Escrow Agent is authorized to deposit with the arbitrator or any court of
competent jurisdiction, as applicable, all documents and funds held in escrow,
except all costs, expenses, charges, and reasonable attorneys' fees incurred by
the Escrow Agent due to the action. Upon initiating such action, the Escrow
Agent shall be fully released and discharged of and from all obligations and
liability imposed by the terms of this Agreement.

5.3    The Vendor and the Purchaser agree, jointly and severally, to indemnify
and hold the Escrow Agent harmless against any and all losses, claims, damages
and liabilities, including reasonable costs of investigation, attorneys' fees,
and disbursements that may be imposed on the Escrow Agent or incurred by the
Escrow Agent in connection with the performance of its duties under this
Agreement, including, but not limited to, any litigation arising from this
Agreement or involving its subject matter, unless such loss, liability, claim or
expense shall have been determined by a court of competent jurisdiction to be a
result of the Escrow Agent's gross negligence or willful misconduct. Anything in
this Agreement to the contrary notwithstanding, in no event shall the Escrow
Agent be liable for special, punitive, indirect, or consequential loss or damage
of any kind whatsoever (including but not limited to lost profits), even if the
Escrow Agent has been advised of the likelihood of such damages and regardless
of the form of action. The obligations to indemnify the Escrow Agent under this
section shall survive termination of this Agreement.

6.
General

 
a.
Notices.  All notices and other communications pertaining to this Agreement
shall be in writing and shall be deemed duly to have been given if personally
delivered to the other Party or if sent by certified mail, return receipt
requested, postage prepaid or by Federal Express, United Parcel or other
nationally recognized overnight carrier. All notices or communications between
Purchaser and Vendor pertaining to this Agreement shall be addressed to the
Vendor at: joekalfa@gmail.com and to the Purchaser at john@riotblockchain.com
and to the Escrow Agent at shira@rktaxlaw.com. Either Party may change its
notification address by giving written notice to that effect to the other Party
in the manner provided herein.

 
b.
Assignment.  Neither party shall assign, transfer, delegate or subcontract any
of its rights or obligations under this Agreement without the prior written
consent of the other party. Any purported assignment or delegation in violation
of this Section shall be null and void. No assignment or delegation shall
relieve the other party of any of its obligations hereunder.

 
c.
Entire Agreement.  This Agreement, all schedules attached hereto and the Escrow
Agreement, is intended as the complete and exclusive statement of the agreement
between Purchaser, Vendor, and the Escrow Agent with respect to the subject
matter hereof, and supersede all prior agreements and negotiations related
thereto.

 
 
 
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d.
Modification and Waiver. Neither this Agreement nor any of its provisions may be
modified, amended, discharged or terminated except in writing signed by the
party against which the enforcement of such modification, amendment, discharge
or termination is sought, and then only to the extent set forth in such writing.
No failure of a party to insist upon strict performance by the other party of
any of the terms and conditions of this Agreement shall constitute or be deemed
to be a waiver of any such term or condition, or constitute an amendment or
waiver of any such term or provision by course of performance, and each party,
notwithstanding any failure to insist upon strict performance, shall have the
right thereafter to insist upon strict performance by the other party of any and
all of the terms and conditions of this Agreement. Any party may, in its sole
and absolute discretion, waive, only in writing, any condition set forth in this
Agreement to such party's obligations under this Agreement which is for the sole
benefit of the waiving party, in which event the non-waiving party or parties
shall be obligated to close the transaction upon all of the remaining terms and
conditions of this Agreement.

 
e.
Governing Law. This Agreement shall be governed for all purposes by the laws of
the Province of Ontario. Nothing contained in this Agreement shall be construed
so as to require the commission of any act contrary to law, and whenever there
is any conflict between any provision contained in this Agreement and any
present or future statute or law, ordinance or regulation or judicial ruling or
governmental decision with the force of law contrary to which the parties have
no legal right to contract, the latter shall prevail, but the provision of the
Agreement which is affected shall be limited only to the extent necessary to
bring it within the requirements of such law, ruling or decision without
invalidating or affecting the remaining provisions of the Agreement.

 
f.
Severability.  If any portion of this Agreement is held invalid, such invalidity
shall not affect the validity of the remaining portions of the Agreement, and
the parties will substitute for any such invalid portion hereof a provision
which best approximates the effect and intent of the invalid provision.

 
g.
Counterparts.  Provided that all parties hereto execute a copy of this
Agreement, this Agreement may be executed in counterparts, each of which shall
be deemed an original and all of which together shall constitute one and the
same instrument.  Executed copies of this Agreement may be delivered by
facsimile transmission or other comparable means.  This Agreement shall be
deemed fully executed and entered into on the date of execution by the last
signatory required hereby.

 
h.
Waiver.  Any waiver by either Party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement.  The failure of a Party to insist upon strict adherence to any term
of this Agreement on one or more occasions shall neither be considered a waiver
nor deprive that Party of any right thereafter to insist upon strict adherence
to that term or any other term of this Agreement.  Any waiver must be in writing
and signed by the Party to be charged therewith.

 
i.
Headings.  The paragraph titles of this Agreement are for conveniences only and
shall not define or limit any of the provisions hereof.

 
 
 
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j.
Binding Effect.  The provisions hereof shall be binding upon and shall inure to
the benefit of Purchaser, Vendor and Escrow Agent, their respective successors,
and permitted assigns.

 
The remainder of this page is intentionally left blank

 

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[SIGNATURES APPEAR ON FOLLOWING PAGES AND ARE SIGNED IN COUNTERPART]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above by their respective officers thereunto duly
authorized.

By the Purchaser

RIOT BLOCKCHAIN, INC.

Per: __________________________
Name:  John O'Rourke
Title:
I have authority to bind the corporation
 

By the Vendor

BLOCKCHAIN MINING SUPPLY &
SERVICES LTD.

Per: __________________________
Name:  Joe (Yonah) Kalfa
Title:    President
I have authority to bind the corporation

By the Escrow Agent

ROSEN AND KIRSHEN PROFESSIONAL CORPORATION

Per: __________________________
Name:  Jason Rosen
Title:    Partner
I have authority to bind the corporation

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Schedule "A"

 

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