Document:

exhibit10-1.htm

EXECUTION COPY

 

AMENDMENT NO. 3

 

Dated as of March 18, 2011

 

to 

 

AMENDED AND RESTATED CREDIT AGREEMENT

 

Dated as of February 12, 2010 

 

     THIS AMENDMENT NO. 3 (“Amendment”) is made as of March 18, 2011 by and among Photronics, Inc. (the “Company”), the financial institutions listed on the signature pages hereof and JPMorgan Chase Bank, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) and as Collateral Agent (in such capacity, the “Collateral Agent”), under that certain Amended and Restated Credit Agreement dated as of February 12, 2010 by and among the Company, the Lenders and the Administrative Agent (as may be further amended, supplemented or otherwise modified from time to time, the “Credit Agreement”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement. 

 

     WHEREAS, the Company has requested that the Lenders, the Administrative Agent and the Collateral Agent agree to certain amendments to the Credit Agreement;

 

     WHEREAS, the Lenders party hereto, the Administrative Agent and the Collateral Agent have agreed to such amendments on the terms and conditions set forth herein;

 

     NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company, the Lenders party hereto, the Administrative Agent and the Collateral Agent have agreed to enter into this Amendment. 

 

     1. Amendments to Credit Agreement. Effective as of the date of satisfaction of the conditions precedent set forth in Section 2 below, the Credit Agreement is hereby amended as follows:

 

     (a) Section 1.01 of the Credit Agreement is amended to insert the following new definitions therein in the appropriate alphabetical order as follows:

 

     “Amendment No. 3 Effective Date” means March 18, 2011.

 

     “Permitted Convertible Notes” means any unsecured notes issued by the Company which may be converted into equity in the Company so long as (i) the indebtedness thereunder does not mature, and is otherwise not subject to any mandatory prepayment, redemption or defeasance, in each case prior to the date that is six (6) months after the Maturity Date and (ii) the terms and conditions applicable thereto are reasonably satisfactory to the Administrative Agent. 

 

     “Permitted Convertible Note Indenture” means the indenture pursuant to which the Company issues any Permitted Convertible Note, as amended, restated, supplemented or otherwise modified from time to time, in each case containing such terms and conditions as are reasonably satisfactory to the Administrative Agent. 

 

 

     (b) The definition of “Aggregate Commitment” appearing in Section 1.01 of the Credit Agreement is amended to delete the final sentence thereof and to replace such sentence with the following sentence:

 

     As of the Amendment No. 3 Effective Date, the Aggregate Commitment is $30,000,000. 

 

     (c) The definition of “Applicable Rate” appearing in Section 1.01 of the Credit Agreement is amended to (i) delete the reference to “Category 4” appearing in clause (i) thereof and to replace such reference with the reference “Category 3” and (ii) delete the pricing grid appearing therein and to replace such pricing grid with the following: 

 

	 	Total Leverage Ratio:	Commitment	Eurocurrency	ABR
	 	 	Fee Rate	Spread	Spread
	  Category 1:	< 1.00 to 1.00	0.35%	2.25%	1.25%
	  Category 2:	> 1.00 to 1.00	0.40%	2.50%	1.50%
	 	but	 	 	 
	 	< 1.50 to 1.00	 	 	 
	  Category 3:	> 1.50 to 1.00	0.45%	2.75%	1.75%

     (d) The definition of “Consolidated EBITDA” appearing in Section 1.01 of the Credit Agreement is amended to add the phrase “, plus (f) any write-downs, write-offs, or losses incurred in connection with the repayment of the Existing Convertible Notes” immediately prior to the phrase “, all as determined on a consolidated basis” appearing in the first sentence thereof. 

 

     (e) The definition of “Maturity Date” appearing in Section 1.01 of the Credit Agreement is amended to delete the date “February 12, 2013” appearing therein and to replace such date with the date “April 30, 2015”. 

 

     (f) The definition of “Permitted Acquisition” appearing in Section 1.01 of the Credit Agreement is amended to delete the amount “$15,000,000” appearing therein and to replace such amount with the amount “$25,000,000”. 

 

     (g) Section 1.01 of the Credit Agreement is amended to delete the definitions of “Expansion Foreign Loans” and “Expansion Loan Amendment” appearing therein. 

 

     (h) Section 2.06(b) of the Credit Agreement is amended to (i) delete clause (i) thereof in its entirety and (ii) change clauses (ii) and (iii) thereof to new clauses (i) and (ii) thereof, respectively. 

 

     (i) Section 2.20 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

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     SECTION 2.20. Expansion Option. The Company may from time to time elect to increase the Commitments in minimum increments of $5,000,000 so long as, after giving effect thereto, the aggregate amount of such increases does not exceed $20,000,000. The Company may arrange for any such increase to be provided by one or more Lenders (each Lender so agreeing to an increase in its Commitment, an “Increasing Lender”), or by one or more new banks, financial institutions or other entities (each such new bank, financial institution or other entity, an “Augmenting Lender”), to increase their existing Commitments or extend Commitments, as the case may be; provided that (i) each Augmenting Lender, shall be subject to the approval of the Company and the Administrative Agent and (ii) (x) in the case of an Increasing Lender, the Company and such Increasing Lender execute an agreement substantially in the form of Exhibit C hereto, and (y) in the case of an Augmenting Lender, the Company and such Augmenting Lender execute an agreement substantially in the form of Exhibit D hereto. No consent of any Lender (other than the Lenders participating in the increase) shall be required for any increase in Commitments pursuant to this Section 2.20. Increases and new Commitments created pursuant to this Section 2.20 shall become effective on the date agreed by the Company, the Administrative Agent and the relevant Increasing Lenders or Augmenting Lenders, and the Administrative Agent shall notify each Lender thereof. Notwithstanding the foregoing, no increase in the Commitments (or in the Commitment of any Lender) shall become effective under this paragraph unless, (i) on the proposed date of the effectiveness of such increase, (A) the conditions set forth in paragraphs (a) and (b) of Section 4.02 shall be satisfied or waived by the Required Lenders and the Administrative Agent shall have received a certificate to that effect dated such date and executed by a Financial Officer of the Company and (B) the Company shall be in compliance (on a Pro Forma Basis reasonably acceptable to the Administrative Agent) with the covenants contained in Section 6.11 and (ii) the Administrative Agent shall have received documents consistent with those delivered on the Effective Date as to the corporate power and authority of the Borrowers to borrow hereunder after giving effect to such increase. On the effective date of any increase in the Commitments, (i) each relevant Increasing Lender and Augmenting Lender shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other Lenders, as being required in order to cause, after giving effect to such increase and the use of such amounts to make payments to such other Lenders, each Lender’s portion of the outstanding Revolving Loans of all the Lenders to equal its Applicable Percentage of such outstanding Revolving Loans, and (ii) the Borrowers shall be deemed to have repaid and reborrowed all outstanding Revolving Loans as of the date of any increase in the Commitments (with such reborrowing to consist of the Types of Revolving Loans, with related Interest Periods if applicable, specified in a notice delivered by the applicable Borrower, or the Company on behalf of the applicable Borrower, in accordance with the requirements of Section 2.03). The deemed payments made pursuant to clause (ii) of the immediately preceding sentence shall be accompanied by payment of all accrued interest on the amount prepaid and, in respect of each Eurocurrency Loan, shall be subject to indemnification by the Borrowers pursuant to the provisions of Section 2.16 if the deemed payment occurs other than on the last day of the related Interest Periods. Nothing contained in this Section 2.20 shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder at any time. 

 

     (j) Section 5.10 of the Credit Agreement is amended to add the phrase “in the United States of America and the United Kingdom” immediately following the phrase “as its principal depository bank” appearing therein. 

 

     (k) Section 6.01(b) of the Credit Agreement is amended to add the phrase “subject to the limitations applicable to Purchase Money Indebtedness set forth in clause (e) below,” immediately prior to the phrase “Indebtedness existing on the date hereof” appearing therein. 

 

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     (l) Section 6.01(e) of the Credit Agreement is amended and restated in its entirety to read as follows:

 

     (e) Indebtedness of the Company or any Subsidiary incurred to finance the acquisition, construction or improvement of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof (collectively, “Purchase Money Indebtedness”); provided that (i) such Purchase Money Indebtedness is (or, in the case of any extension renewal or replacement, was originally) incurred prior to or within 90 days after such acquisition or the completion of such construction or improvement and (ii) the aggregate outstanding principal amount of Purchase Money Indebtedness permitted by this clause (e), when aggregated with the aggregate outstanding principal amount of Purchase Money Indebtedness permitted under Section 6.01(b) and other Purchase Money Indebtedness outstanding on the Amendment No. 3 Effective Date, shall not exceed $75,000,000 at any time outstanding;

 

     (m) Section 6.01 of the Credit Agreement is amended to (i) delete the word “and” appearing at the end of clause (i) thereof, (ii) delete the period appearing at the end of clause (j) thereof and to replace such period with “; and” and (iii) add the following as a new clause (k) thereof:

 

     (k) Indebtedness of the Company under the Permitted Convertible Notes in an aggregate principal amount not to exceed $150,000,000. 

 

     (n) Section 6.04(k) of the Credit Agreement is amended and restated in its entirety to read as follows:

 

     (k) any other investment (other than acquisitions), loan or advance (including investments made to meet minimum capital requirements of foreign jurisdictions) so long as the aggregate amount of all such investments, loans and advances during any fiscal year of the Company, when aggregated with the aggregate consideration (including the concurrent repayment or assumption of any indebtedness and related investments) paid in respect of all Permitted Acquisitions during such fiscal year of the Company, does not exceed $25,000,000. 

 

     (o) Section 6.06(a) of the Credit Agreement is amended to (i) delete the amount “$5,000,000” appearing therein and to replace such amount with the amount “$10,000,000”, (ii) delete the word “and” immediately preceding clause (v) thereof and replace such word with a comma and (iii) add the following as a new clause (vi) thereof:

 

     and (vi) the Company may issue Equity Interests in connection with or as part of the conversion, redemption, retirement, prepayment or cancellation of the Existing Convertible Notes or the Permitted Convertible Notes

 

     (p) Section 6.06(b) of the Credit Agreement is amended to (i) delete the word “and” immediately preceding clause (iii) thereof and (ii) add the following as new clauses (iv) and (v) thereof: 

 

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     ; (iv) prepayment of the Existing Convertible Notes from the proceeds of the Permitted Convertible Notes (including premiums and fees associated therewith); (v) prepayment, purchase, redemption, retirement or other acquisition of the Permitted Convertible Notes by exchange for or out of the proceeds received from a substantially concurrent issue of (1) new shares of its non-mandatorily redeemable Equity Interests pursuant to the conversion terms described in a Permitted Convertible Note Indenture or (2) Subordinated Indebtedness or other Permitted Convertible Notes; and (vi) prepayment of the Nanofab Building Lease and the RBS Asset Finance Lease set forth on Schedule 6.01

 

     (q) Section 6.11(d) of the Credit Agreement is amended and restated in its entirety to read as follows:

 

     (d) [Intentionally Omitted].

 

     (r) Section 9.02(b) of the Credit Agreement is amended to (i) delete the phrase “Except as provided in Section 2.20 with respect to an Expansion Loan Amendment, neither” appearing therein and to replace such phrase with the word “Neither” and (ii) delete the parenthetical “(it being understood that, solely with the consent of the parties prescribed by Section 2.20 to be parties to an Expansion Loan Amendment, Expansion Foreign Loans (as defined in Section 2.20) may be included in the determination of Required Lenders on substantially the same basis as the Commitments and the Revolving Loans are included on the Effective Date)” appearing in clause (v) thereof. 

 

     (s) Section 9.02(c) of the Credit Agreement is amended and restated in its entirety to read as follows:

 

     (c) [Intentionally Omitted].

 

     (t) Each of Schedule 2.01, Exhibit C and Exhibit D to the Credit Agreement is replaced in its entirety with Schedule 2.01, Exhibit C and Exhibit D attached hereto, respectively. 

 

     2. Conditions of Effectiveness. The effectiveness of this Amendment is subject to the conditions precedent that (a) the Administrative Agent shall have received (i) counterparts of this Amendment duly executed by the Company, the Lenders and the Administrative Agent and the Consent and Reaffirmation attached hereto duly executed by the Subsidiary Guarantors and (ii) such opinions, instruments and documents as are reasonably requested by the Administrative Agent, (b) the Company shall have paid to the Administrative Agent, for the account of each Lender, an amendment fee equal to 0.30% of such Lender’s Commitment as amended hereby and (c) the Company shall have paid all of the fees of the Administrative Agent and its affiliates (including, to the extent invoiced, reasonable attorneys’ fees and expenses of the Administrative Agent) in connection with this Amendment and the other Loan Documents; provided, that upon satisfaction of the conditions in this Section 2, this Amendment shall be held in escrow until released simultaneously with the closing and effectiveness of the Permitted Convertible Indenture. Notwithstanding the foregoing, if the closing and effectiveness of the Permitted Convertible Indenture does not occur on or prior to the date that is 45 days after the date of this Amendment, the parties hereto agree that this Amendment shall terminate and have no further effect with respect to the Credit Agreement. 

 

     3. Representations and Warranties of the Company and Acknowledgements and Confirmations. The Company hereby represents and warrants as follows: 

 

     (a) This Amendment and the Credit Agreement, as amended hereby, constitute legal, valid and binding obligations of the Company and are enforceable against the Company in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law. 

 

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     (b) As of the date hereof and giving effect to the terms of this Amendment, (i) no Default shall have occurred and be continuing and (ii) the representations and warranties of the Company set forth in the Credit Agreement, as amended hereby, are true and correct as of the date hereof. 

 

     4. Reference to and Effect on the Credit Agreement. 

 

     (a) Upon the effectiveness hereof, each reference to the Credit Agreement in the Credit Agreement or any other Loan Document shall mean and be a reference to the Credit Agreement as amended hereby. 

 

     (b) Except as specifically amended above, the Credit Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect and are hereby ratified and confirmed. 

 

     (c) The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith. 

 

     5. Governing Law. This Amendment shall be construed in accordance with and governed by the law of the State of New York. 

 

     6. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose. 

 

     7. Counterparts. This Amendment may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Signatures delivered by facsimile or PDF shall have the same force and effect as manual signatures delivered in person. 

 

[Signature Pages Follow] 

 

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     IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written. 

 

	 	
PHOTRONICS, INC.,

	 	
as the Company

	 	  	 
	 	
By:  

	
/s/ Donna M. Bovee

	 
	 	Name:  	
Donna M. Bovee

	 	
Title:

	
Vice President, Treasurer

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Amendment No. 3

Photronics, Inc.

Amended and Restated Credit Agreement dated as of February 12, 2010

 

 

	 	
JPMORGAN CHASE BANK, N.A., individually as a Lender

	 	
and as Administrative Agent

	 	
 

	 
	 	
By:  

	
/s/ Kenneth Coons

	 
	 	Name:  	
Kenneth Coons

	 	
Title:

	
VP - Senior Underwriterr

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Amendment No. 3

Photronics, Inc.

Amended and Restated Credit Agreement dated as of February 12, 2010

 

 

	 	
RBS CITIZENS, NATlONAL ASSOCIATION,

	 	
as a Lender

	 	
 

	 
	 	
By:  

	
/s/ David M. Nackley

	 
	 	Name:  	

David M. Nackley

	 	
Title:

	
Senior Vice President

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Amendment No. 3

Photronics, Inc.

Amended and Restated Credit Agreement dated as of February 12, 2010

 

 

	 	
TD BANK, N.A.,

	 	
as a Lender

	 	
 

	 
	 	
By:  

	
/s/ Stephen B. Francis

	 
	 	Name:  	
Stephen B. Francis

	 	
Title:

	
Vice President

 

 

 

 

 

 

 

 

 

 

 

 

Signature Page to Amendment No. 3

Photronics, Inc.

Amended and Restated Credit Agreement dated as of February 12, 2010

 

 

CONSENT AND REAFFIRMATION 

 

     Each of the undersigned hereby acknowledges receipt of a copy of the foregoing Amendment No. 3 to the Amended and Restated Credit Agreement dated as of February 12, 2010 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Photronics, Inc. (the “Company”), the Foreign Subsidiary Borrowers from time to time party thereto (together with the Company, the “Borrowers”), the financial institutions from time to time party thereto (the “Lenders”) and JPMorgan Chase Bank, N.A., as Administrative Agent (the “Administrative Agent”), which Amendment No. 3 is dated as of March 18, 2011 (the “Amendment”). Capitalized terms used in this Consent and Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement. Without in any way establishing a course of dealing by the Administrative Agent or any Lender, each of the undersigned consents to the Amendment and reaffirms the terms and conditions of the Subsidiary Guaranty and any other Loan Document executed by it and acknowledges and agrees that such agreements and each and every such Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed. All references to the Credit Agreement contained in the above-referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment and as the same may from time to time hereafter be amended, modified or restated. 

 

Dated: March 18, 2011 

 

[Signature Page Follows] 

 

 

 

	
ALIGN-RITE, INC.

	 	

ALIGN-RITE, INTERNATIONAL, INC.

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
Vice President

	 	
Title:

	
Vice President

	
PHOTRONICS ARIZONA, INC.

	 	
PHOTRONICS CALIFORNIA, INC.

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
Vice President

	 	
Title:

	
Vice President

	
PHOTRONICS TEXAS, INC.

	 	
PHOTRONICS TEXAS ALLEN, INC.

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
Vice President

	 	
Title:

	
Vice President

	

PHOTRONICS TEXAS I, LLC

	 	

PHOTRONICS TEXAS I, L.P.

	 	 	 
	
By: Photronics Texas, Inc., its Sole Member

	 	
By: Photronics Texas, Inc., its General Partner

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
Vice President

	 	
Title:

	
Vice President

	

PHOTRONICS TEXAS II, LLC

	 	

PHOTRONICS TEXAS II, L.P.

	 	 	 
	
By: Photronics Texas Allen, Inc., its Sole Member

	 	

By: Photronics Texas Allen, Inc., its General Partner

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
Vice President

	 	
Title:

	
Vice President

	

PHOTRONICS IDAHO, INC.

	 	
TRIANJA TECHNOLOGIES, INC.

	 	 	 	
 

	 
	
By:  

	
/s/ Richelle Burr

	 	 	
By:  

	

/s/ Richelle Burr

	 
	Name:  	
Richelle Burr

	 	Name:  	
Richelle Burr

	
Title:

	
President

	 	
Title:

	
Vice President

 

Signature Page to Amendment No. 3

Photronics, Inc.

Amended and Restated Credit Agreement dated as of February 12, 2010ex10_1.htm

Exhibit 10.1

 

ESCROW AGREEMENT

 THIS AGREEMENT (this “Agreement”) is entered into as of this 28th day of February, 2011 by and between Auscrete Corporation (the “Company”) and U.S. Bank National Association (the “Escrow Agent”), a national banking association. 

RECITALS

A.           The Company is conducting a public offering of shares of its common stock (the “Shares”) at a price of $.30 per Share, under applicable State and Federal laws and regulations (the “Offering”).

 B.           The Company wishes to assure those who subscribe for Shares (the “Subscriber”) that the Subscribers’ monies will be released to the Company only if and when not less than $750,000 (the “Threshold Amount”) in subscriptions for at least 2,500,000 Shares are accepted by the Company from the sale of Shares and upon the direction of the Company. 

C.           The Company desires to provide for the safekeeping of the proceeds of the Offering until such time as subscriptions for Shares totaling the Threshold Amount (or such greater amount as the Company may direct in writing) have been received and upon the direction of the Company, or until such time as Escrow Agent is required to pay and return such proceeds to the Subscribers upon the terms hereinafter provided.

AGREEMENT

1.             Deposit and Disbursement.

a.           Escrow Agent hereby agrees to receive and disburse the proceeds from the offering of the Shares and any interest earned thereon in accordance with the terms of this Agreement.

b.           The Company or its authorized placement agents, on behalf of the Subscribers, shall from time to time cause to be wired or deposited with Escrow Agent all proceeds received from sales of Shares to be placed in a non interest bearing escrow account at Escrow Agent designated as the Auscrete Corporation of Wyoming Escrow Account (the “Escrow Account”) until the Threshold Amount (or such greater amount as the Company may direct in writing) has been deposited in said account.  All proceeds are to be deposited in the Escrow Account within five (5) business days after receipt by Escrow Agent.

c.           As deposits are made in the Escrow Account, Company shall cause to be delivered to Escrow Agent with each such deposit a stock certificate representing the Shares subscribed to in connection with the deposit along with a list showing the name, address, and tax identification number of each Subscriber together with a copy of a fully completed subscription agreement for each Subscriber.  Escrow Agent shall keep a current list of the persons who have subscribed for the Shares and deposited money, showing name, date, address and amount of each subscription.  All funds so deposited shall remain the property of the Subscribers, subject to the provisions of Paragraph 5 hereof.  Escrow Agent shall promptly forward to the Company any subscription agreements which it may receive directly from Subscribers.

 

  

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d.           If the Company rejects any subscriptions for which Escrow Agent has already collected funds, Escrow Agent shall promptly issue a refund check to the rejected Subscriber in the amount of the original deposit collected from such Subscriber.  If the Company rejects any subscription for which Escrow Agent has not yet collected funds but has submitted the Subscriber’s check for collection, Escrow Agent shall promptly remit the Subscriber’s check directly to the Subscriber.

 e.           In the event that the Threshold Amount is not deposited with Escrow Agent on or before 18 months from the opening of the Company’s IPO, Escrow Agent shall promptly return the funds, which have been deposited in the Escrow Account, to the Subscribers, in the amount and to the addresses as shown on its records. 

 

 f.           The Threshold Amount (or such greater amount as the Company may direct in writing), less any unpaid fees and expenses, shall be released to the Company upon the occurrence of the following events: (i) achievement of the Threshold Amount (or such greater amount as the Company may direct in writing); (ii) a written agreement between the Company and Auscrete Corporation, a corporation organized under the laws of Oregon (“Auscrete of Oregon”) for the acquisition of certain assets of Auscrete of Oregon for the purchase price of $737,900 (the “Acquisition Agreement”); (iii) presentment by the Company of reaffirmation agreements by a number of investors subscribing to an aggregate amount of Shares totaling at least the Threshold Amount reaffirming their desire to remain investors of the Company subsequent to receiving an updated Prospectus identifying the Acquisition Agreement with updated Audited Financial Statements; and (iii) written confirmation from the Company that funds may be released from escrow, Escrow Agent shall release the escrow funds,.  Upon release of the escrow funds, Escrow Agent shall release to each Subscriber of the Shares, their respective stock certificates representing their Shares. At the Company’s option, it may continue to deposit proceeds from the sale of additional Shares (after receipt an/or distribution of the Threshold Amount or any greater amount as directed in writing by the Company) and to direct the disbursement from time to time of funds so deposited after subscriptions for the Threshold Amount have been received, for up to one year thereafter. 

2.             Responsibilities and Obligations of Escrow Agent.

a.           Escrow Agent assumes no responsibilities, obligations, or liabilities except those expressly provided for in this Agreement as follows:

(1)           Escrow Agent shall have no responsibility, obligation or liability to any person with respect to any action taken, suffered or omitted to be taken by it in good faith under this Agreement and shall in no event be liable hereunder except for its gross negligence or willful misconduct.  Without any limitation of the foregoing, Escrow Agent shall have no responsibility to determine the Partnership’s compliance with any of its obligations to Broker-Dealer or the Subscribers, the Memorandum, the Threshold Amount or acceptance by the Partnership of any or all of the subscription documents.

 

  

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(2)           Notwithstanding anything herein to the contrary, no reference in this Agreement to any other agreement shall be construed or deemed to enlarge the responsibilities, obligations, or liabilities of Escrow Agent set forth in this Agreement, and Escrow Agent is not charged with knowledge of any other agreement.

b.           Escrow Agent shall be protected in relying upon the truth of any statement contained in any requisition, notice, request, certificate, approval, consent or other proper paper, and in acting on any such document, which on its face and without inquiry as to any other facts, appears to be genuine and to be signed by the proper party or parties, and is entitled to believe all signatures are genuine and that any person signing any such paper who claims to be duly authorized is in fact so authorized.

c.           Escrow Agent shall be entitled to act on any instruction given in accordance with the terms herein, in writing and signed by an authorized signatory of the Company and shall be fully protected in doing so.

d.           Escrow Agent shall be entitled to act in accordance with any court order or other final determination by any governmental authority with jurisdiction of any matter arising hereunder.

e.           Escrow Agent shall have no responsibility for, and makes no representation as to the value, validity or genuineness of any article, asset or document deposited with Escrow Agent in the Escrow Account under this Agreement, provided that it will give notice to the Company of any check for money not credited and the reason stated therefore and of any discrepancy with respect to the value, validity or genuineness of any article, asset or document so deposited if and when it has actual knowledge thereof.

f.           Escrow Agent shall have no responsibility to make payments out of the Escrow Account for any amount in excess of the amount of collected funds deposited in the Escrow Account, together with any interest earnings thereon, at the time any payment is to be made.

g.           If any controversy arises between the parties hereto or with any third person relating to the Escrow Account, Escrow Agent shall not be required to resolve the same or to take any action to do so but may at its discretion, institute such interpleader or other proceedings as it deems proper.  In the event that the Escrow Agent shall be reasonably uncertain as to its duties or rights hereunder or shall receive instructions, claims or demands from any party hereto which, in its reasonable opinion, conflict with any of the provisions of this Agreement, it shall be entitled to refrain from taking any action and its sole obligation shall be to keep safely all property held in escrow.

h.           Escrow Agent may execute any of its powers or responsibilities hereunder and exercise any of its rights hereunder either directly or by or through its agents or attorneys.  Nothing in this Agreement shall be deemed to impose upon Escrow Agent any duty to qualify to do business or to act as a fiduciary or otherwise in any jurisdiction.  Escrow Agent shall not be responsible for and shall not be under a duty to examine or pass upon the validity, binding effect, execution or sufficiency of the Agreement or of any agreement amendatory of supplemental hereto or of any other agreement.

 

  

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3.             Investment of Escrow Funds.

The Escrow Agent is hereby directed to deposit and hold fund uninvested.

4.             Compensation of Escrow Agent.

Escrow Agent shall be paid for services hereunder and shall be reimbursed for its out of pocket expenses for fees of counsel in setting up the escrow, all in accordance with the fee schedule attached hereto as Exhibit B.  Payment of all fees shall be the responsibility of the Company and may, to the extent of unpaid fees and expenses, be deducted from any property placed within the escrow with Escrow Agent.  In the event that Escrow Agent is made a party to litigation with respect to the property held hereunder, or brings an action in interpleader or in the event that the conditions of this escrow are not promptly fulfilled, or Escrow Agent is required to render any service not provided for in this Agreement and fee schedule, or there is any assignment of the interest of this escrow or any modification hereof, Escrow Agent shall be entitled to reasonable compensation for such extraordinary services and reimbursement for all fees, costs, liability and expenses, including reasonable attorneys’ fees.  Escrow Agent may amend its fee schedule from time to time on thirty (30) days prior written notice to the Company.

5.             Indemnification of Escrow Agent.

The Company hereby indemnifies and holds harmless Escrow Agent against any and all claims, losses, and damages it may suffer in connection with its carrying out the terms of this Agreement, including, without limitation, Escrow Agent’s unpaid fees and reimbursable expenses, but excluding any loss Escrow Agent may sustain as a result of its gross negligence or willful misconduct.  Escrow Agent shall have a lien or right of setoff on all funds, monies or other assets held hereunder to pay all of its fees and reimbursable expenses permitted under this Agreement.  The obligations of the Company under this Section 5 shall survive termination for any reason of this Agreement or resignation or removal of Escrow Agent.

6.             Termination and Resignation.

a.           This Agreement shall terminate when (i) Escrow Agent or its successor or assign receives written notification of termination from the Company including final disposition instructions signed by the Company, and (ii) there occurs the actual final disposition of the monies held in escrow hereunder as provided in this Agreement.  The rights and obligations of Escrow Agent shall survive the termination of this Agreement.

 

  

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b.           Escrow Agent may resign at any time and be discharged from its duties as escrow agent hereunder by giving the Company no fewer than twenty (20) days prior written notice thereof.  As soon as practicable after its resignation, Escrow Agent shall turn over to a successor escrow agent appointed by the Company all monies held hereunder upon presentation of the document from the Company appointing a successor escrow agent and its acceptance of appointment.  If no successor is appointed, Escrow Agent may designate its successor by written notice to the Company so long as any such successor is a bank or trust company.  Upon the designation of a successor escrow agent and the delivery to a resigning escrow agent of the document appointing such successor escrow agent and its acceptance of appointment, the resigning escrow agent shall be released from any and all liabilities arising thereafter except as provided in Sections 2(a)(1) and 5 of this Agreement.  If no successor escrow agent is appointed by the Company within the twenty (20) day period following such notice of resignation, Escrow Agent reserves the right to forward the matter and all monies and other property held by Escrow Agent pursuant to this Agreement to a court of competent jurisdiction at the expense of the Company.

c.           The Company may discharge Escrow Agent and appoint a successor escrow agent hereunder at any time by giving Escrow Agent no fewer than twenty (20) days prior written notice thereof.  As soon as practicable after its discharge, Escrow Agent shall turn over to the successor escrow agent appointed by the Company all monies held hereunder upon presentation of the document from the Company appointing such successor escrow agent and its acceptance of appointment.  Upon the designation of a successor escrow agent, the delivery of the document appointing a successor escrow agent, and the delivery of all monies held hereunder to such successor escrow agent pursuant to the immediately preceding sentence, the discharged escrow agent shall be released from any and all liabilities arising thereafter except as provided in Sections 2(a)(1) and 5 of this Agreement.

7.           Notices.

All notices provided for herein shall be in writing, shall be delivered by hand or by registered or certified mail shall be deemed given when actually received, and shall be addressed to the parties hereto at their respective addresses, which may be changed by any party from time to time by written notice to all other parties hereto as follows:

 

	 	a.  	If to the Company:	 
	 	 	 	 
	 	 	
Auscrete Corporation

	 
	 	 	
PO Box 847

	 
	 	 	
Rufus,   OR  97050

	 
	 	 	
Attn. John Sprovieri

	 
	 	 	(541) 739-8200	 
	 	 	
(541) 739-8234(fax)

	 
	 	 	 	 
	 	b.	If to the Escrow Agent:	with a copy to:
	 	 	 	 
	 	 	U.S. Bank Corporate Trust Svcs.	U.S. Bank Corporate Trust Services
	 	 	60 Livingston Avenue	555 SW Oak Street, 6th Floor
	 	 	EP-MN-WS3T	Portland, OR  97204
	 	 	St. Paul, MN  55107-2292	Attn:  Cheryl Nelson
	 	 	Attn:  Leye Fadahunsi	(503) 275-5713
	 	 	(651) 495-3726 	(503) 275-5738 (fax)
	 	 	(651) 495-8087 (fax)	 

 

  

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8.             Disclosure.

The Company represents and agrees that it has not made nor will it in the future make any representation that states or implies that the Escrow Agent has endorsed, recommended or guaranteed the purchase, value, or repayment of the Securities offered for sale by the Company.  The Company further agrees that it will insert in any prospectus, offering circular, advertisement, subscription agreement or other document made available to prospective purchasers of the Securities the following statement in bold face type:  “U.S. Bank National Association is acting only as an escrow agent in connection with the offering of Securities described herein, and has not endorsed, recommended or guaranteed the purchase, value or repayment of such Securities”, and will furnish to the Escrow Agent a copy of each such prospectus, offering circular, advertisement, subscription agreement or other document at least 5 business days prior to its distribution to prospective purchasers of the Securities.

9.             Brokerage Confirmation.

The parties acknowledge that to the extent regulations of the Comptroller of Currency or other applicable regulatory entity grant a right to receive brokerage confirmations of security transactions of the escrow, the parties waive receipt of such confirmations to the extent permitted by law.  Escrow Agent shall furnish a statement of security transactions on its regular monthly reports to the Company.

10.           Parties Bound.

This Agreement shall extend to and be binding upon the respective successors, representatives, and assigns of the Company and Escrow Agent.

11.           Entire Agreement.

This Agreement constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and cannot be modified, amended, supplemented, or changed, nor can any provisions hereof be waived, except by written instrument executed by the parties hereto.

12.           Assignment.

Neither party may assign its rights or obligations under this Agreement without the written consent of the other party hereto.

13.           Applicable Law.

The Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Oregon.

 

14.           Severability.

If at any time subsequent to the date hereof, any provision of this Agreement shall be held by a court of competent jurisdiction to be illegal, void, or unenforceable, such provision shall be of no force or effect, and shall be limited or expanded in scope so as to carry out the intent of the parties as expressed herein to the greatest extent possible.  The illegality or unenforceability of any such provision shall have no effect upon and shall not impair the enforceability of any other provision of this Agreement.

 

  

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15.           Counterparts.

This Agreement may be executed in any number of counterparts, each of which shall be deemed to be one and the same instrument.  The exchange of copies of this Agreement and of signature pages by facsimile transmission shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes.  Signatures of the parties transmitted by facsimile shall be deemed to be their original signatures for all purposes.

 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

 

	 
	AUSCRETE CORPORATION (Wyoming), Company
	 
		 
	 	 
	 	 
	 	 
	U.S. BANK NATIONAL ASSOCIATION, as Escrow Agent
	 	 
		 

 

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