- ……………. (the “Escrow Agent”);
- [ ] of [ ] (the “Seller”); and
- ……………. (the “Buyer”/ “Depositor”).
(The Escrow Agent, the Seller and the Buyer/Depositor are collectively called “the Parties” and any of them, “a Party”.)
- The Seller is a company with limited liability incorporated under the laws of [ ], whose registered office is at [ ].
- The Buyer is a company with limited liability incorporated under the laws of ……….., whose registered office is at ………………………
- The Seller has agreed to sell and the Buyer has agreed to purchase 100 kg Au Metal to be followed by monthly deliveries of not less than 500 kg in total in each month (collectively the “Sale Au Metal”) for the consideration to be determined upon the terms and subject to the conditions set forth in the Agreement made between the Seller and the Buyer/Depositor dated [ ] 2019 with Contract No.[ ] (the “SPA”).
- Pursuant to the SPA, the Buyer is required to deposit a sum of money to be held in escrow.
- The Seller and the Buyer have requested the Escrow Agent to act in the place and stead of “Hart Giles, Solicitors & Notaries” named in the SPA as the escrow agent.
- The Escrow Agent has agreed to act as the escrow agent and hold the Escrow Cash (as defined herein) in accordance with the terms and conditions hereof.
NOW IT IS HEREBY AGREED AS FOLLOWS:
- Escrow Cash
- The Depositor shall deposit 5% of the funds against assayed gold as a collateral of equal amount to secure the buyers funds at the port of loading for the tranche as per the Request For Payment Note of the Seller with the Escrow Agent latest within two days after the date of the Request For Payment Note, and the Escrow Agent shall hold such funds in accordance with the terms of this Agreement.
- The foregoing funds and any further deposits of funds by the Depositor received or to be received by the Escrow Agent, less any funds distributed or paid in accordance with this Agreement, are collectively referred to herein as the “Escrow Cash“.
- In the event that the Escrow Agent does not receive any of the Escrow Cash on or prior to the date specified in the Request For Payment Note of the Seller, then this Agreement shall terminate on such date, unless the Parties expressly agree otherwise in writing prior to such date.
- In order to provide for the payment of any disbursements under this Agreement, funds must be deposited in the Escrow Account specified in the Schedule hereto not later than 10:00 a.m. two (2) Business Days prior to the relevant due date for payment.
- Holding of Escrow Cash
- Unless otherwise provided for in the Request For Payment Note of the Seller, funds to be deposited with the Escrow Agent will bear no interest. The Escrow Agent shall have no duty, responsibility nor obligation to pay any interest on, invest or reinvest any funds held in escrow pursuant to this Agreement.
- Unless otherwise specifically set forth in this Agreement, the Escrow Agent shall not be responsible for ensuring that any part, or all, of the Escrow Cash is deposited with or delivered to the Escrow Agent. The Escrow Agent shall not be required to take any legal action to enforce payment of any cheque, note or security to be deposited under this Agreement or to exercise any right or privilege which may be afforded to the holder of any such security.
- Distribution of Escrow Cash
- After presentation of at least the following documents under the SPA to the Escrow Agent by the Seller, the Sale Au METAL are considered received by the Buyer:
- Original Commercial Invoice (5 sets);
- Original Certificate of Ownership;
- Original Expert Permit;
- Original Movement Certificate;
- Original Payment Receipt for Mineral Royalty Tax, Export Taxes and any other applicable tax;
- Airway Bill;
- Original Deed of Assignment of Ownership;
- Final Assay Report of Dubai Refinery or any similar refinery appointed by the Buyer; and
- Irrevocable Release Order to the Refinery legally valid signed by Seller’s legal representative.
Upon receipt of the document under (i), the Irrevocable Release Order is immediately passed on by the Escrow Agent to the Refinery’s contact by fax/e-mail as stated in the document itself to complete the Title transfer to the Buyer.
All Documents are released to the Buyer by the Escrow Agent upon receipt.
- Upon the Buyer’s receipt of the Title for the Sale Au Metal by presenting before mentioned (a) to (i) documents to the Escrow Agent, the Escrow Agent will have an irrevocable instruction to remit (a) the Purchase Price to the account of as designated by the Seller as set out in the SPA, (b) the Commission to the Intermediaries’ designated accounts, (c) the Escrow Agent Fee to the Escrow Agent’s designated account.
- At the time of execution of this Agreement by making payments to the Parties under Clause 3.2 above, the Seller and the Buyer/Depositor shall pay the fees of the Escrow Agent at 0.2% of the Escrow Cash in equal shares (“Escrow Agent Fee”).
- Upon termination of this Agreement for whatever reasons, the Seller and the Buyer/Depositor shall be jointly and severally liable to pay the Escrow Agent Fee, and the Escrow Agent shall have joint and irrevocable instructions of the Seller and the Buyer/Depositor to uplift the principal amount of the Escrow Cash and deduct the Escrow Agent Fee and pay the remaining balance to the Parties in accordance with this Agreement.
- The Seller and the Buyer/ Depositor shall be jointly and severally responsible for, and shall reimburse the Escrow Agent upon demand for, all expenses, disbursements, charges payable and advances incurred or made by the Escrow Agent in connection with the services rendered by it under this Agreement (including, but not limited to, all legal fees, stamp and other documentary duties or taxes, and expenses incurred in the preparation and negotiation of this Agreement).
- The Escrow Agent may share its fees with any person connected to the Escrow Agent and shall not be accountable to the Parties for any such sharing arrangements.
- All amounts of whatever nature payable to, and recoverable by, the Escrow Agent pursuant to the terms of this Agreement shall be payable without set-off or counterclaim by the Depositor within three (3) Business Days of receipt of any invoice of the Escrow Agent.
- Scope of Duties of the Escrow Agent
- The duties, responsibilities and obligations of the Escrow Agent shall be limited to those expressly set forth herein and, to the maximum extent permitted by law, no duties, responsibilities, covenants or obligations shall be inferred or implied against the Escrow Agent. The Escrow Agent may carry out such other acts and perform such other duties as in its sole discretion it considers necessary to give effect to this Agreement and perform services hereunder, including entering into subcontracts and agreements with third parties.
- The Escrow Agent shall maintain its bank account as referred to in the Schedule hereto for the holding of the Escrow Cash (the “Escrow Account“). The Escrow Cash shall be held by the Escrow Agent on behalf of the Parties in the account with itself as trustee.
- The Escrow Agent shall be solely authorized to cause the Escrow Cash, or any part thereof, to be withdrawn or transferred from the Escrow Account and provide instructions in respect of other matters relating to the Escrow Account, provided that any such withdrawals, transfers and instructions shall be carried out in accordance with the provisions of this Agreement.
- The Escrow Agent shall not be subject to, or required to comply with, any other agreement between or among any or all of the Parties or to which any Party is a party, even though reference to such an agreement may be made herein, or to comply with any direction or instruction, other than those contained herein or delivered in accordance with this Agreement, from any Party or any entity acting on behalf of a Party.
- Rights and Liabilities of the Escrow Agent
- The Escrow Agent shall not be liable for any action taken, suffered or omitted or for any loss or injury resulting from its actions, or from its performance, delay of performance or lack of performance of its duties, under this Agreement in the absence of gross negligence or willful misconduct on its part or on the part of its officers, directors or employees. In no event shall the Escrow Agent be liable (whether by way of indemnity, damages or otherwise), and it shall be fully protected from all liability, loss, cost, damage or expense:
- for acting or omitting to act in accordance with or relying upon any Order (as hereinafter defined), instruction, notice, demand, certificate, affidavit, notice, opinion, instrument, document or other writing delivered to it hereunder without determining the authenticity of such document, the correctness of any fact stated therein, the propriety of the service thereof or the capacity, identity or authority of any Party purporting to sign or deliver such document;
- for anything done, suffered or omitted by a sub-custodian or other nominee, correspondent, designee, or sub-agent, subject to the Escrow Agent having selected such entity with reasonable care;
- for the action or inaction of any depository;
- for any failure by any Party to perform its obligations;
- for any consequential, punitive or special damages, or economic or indirect loss of any kind whatsoever, in each case however caused or arising and whether or not foreseeable, even if advised of the possibility of such damage or loss, regardless of whether the claim for loss or damage is made in negligence, for breach of contract or otherwise;
- for not performing any act or fulfilling any duty, obligation or responsibility under this Agreement by reason of any occurrence beyond the control of the Escrow Agent (including, but not limited to, any order, act or provision of any present or future law or regulation or governmental authority, any act of God, fire, riot, embargo, labour dispute or war, or the unavailability of any wire or communication facility); or
- for an amount in excess of the value of the Escrow Cash, valued as of the date of the deposit.
- The Escrow Agent shall under no circumstances be required to make any payment or transfer from the Escrow Account where doing so would create a negative balance in the Escrow Account. The Escrow Agent shall not be required to expend or risk any of its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder.
- The Escrow Agent shall not be under any duty to take any action which may, in its absolute opinion, be contrary to applicable laws, rules or regulations.
- Statements from the Escrow Agent
All statements from the Escrow Agent identifying transactions, transfers or holdings of the Escrow Cash shall be deemed to be correct and final upon receipt of the statement by the Parties unless the Escrow Agent is notified in writing to the contrary within five (5) Business Days of the date of such statement.
- Indemnity to the Escrow Agent
The Parties, jointly and severally, shall be liable for and shall reimburse and indemnify the Escrow Agent on demand and hold the Escrow Agent harmless from and against any and all claims, losses, liabilities, costs, damages and expenses (including attorneys’ fees and expenses) (collectively, “Losses“) arising from or in connection with or related to this Agreement, including the Escrow Agent’s reliance upon and compliance with instructions or directions given by Electronic Methods and including, but not limited to, Losses incurred by the Escrow Agent in connection with its successful defence, in whole or in part, of any claim of gross negligence or willful misconduct on its part; provided, however, that nothing contained in this clause shall require the Escrow Agent to be indemnified for Losses caused by its gross negligence or willful misconduct.
- Representations and Warranties of Depositor
The Depositor hereby represents and warrants that:
- It is duly incorporated and validly existing under the laws of its jurisdiction of incorporation;
- this Agreement has been duly authorized, executed and delivered on its behalf and constitutes its legal, valid and binding obligation;
- the execution, delivery and performance of this Agreement by the Depositor do not and will not violate any applicable law or regulation; and
- the Escrow Cash is coming from legitimate source and non-criminal origin and is deposited with a reputable bank prior to being remitted to the Escrow Account.
- Representations and Warranties of Seller
The Seller hereby represents and warrants that:
- It is duly incorporated and validly existing under the laws of its jurisdiction of incorporation;
- this Agreement has been duly authorized, executed and delivered on its behalf and constitutes its legal, valid and binding obligation; and
- the execution, delivery and performance of this Agreement by the Seller do not and will not violate any applicable law or regulation.
- Resignation of Escrow Agent
- The Escrow Agent may resign at any time by giving to the Depositor three (3) Business Days’ prior written notice thereof.
- Subject to the terms of this Agreement, upon the Escrow Agent’s resignation, the Escrow Agent will refund the remaining balance of the Escrow Cash to the Depositor, or to any account as designated by the Depositor.
- Dispute relating to escrow cash
- In the event of any ambiguity or uncertainty under this Agreement or in any notice, instruction or other communication received by the Escrow Agent under this Agreement, the Escrow Agent may, in its sole discretion, refrain from taking any action other than retaining possession of the Escrow Cash, unless and until the Escrow Agent receives written instructions, signed by all the Parties, which eliminates such ambiguity or uncertainty.
- In the event of any dispute between or conflicting claims by or among the Parties and/or any other person or entity with respect to any Escrow Cash, the Escrow Agent shall be entitled, in its sole discretion, to refuse to comply with, and shall not be liable in any way for failure to comply with, any and all claims, demands or instructions with respect to such Escrow Cash until, in its sole discretion:
- such conflicting or adverse claims or demands shall have been resolved, to the satisfaction of the Escrow Agent, by agreement among the Parties in the dispute;
- such conflicting or adverse claims or demands shall have been determined by a final order, judgment or decree of a court of competent jurisdiction, which order, judgment or decree is not subject to appeal, or settled by agreement between the conflicting Parties as evidenced in a writing satisfactory to the Escrow Agent; or
- the Escrow Agent shall have received security or an indemnity satisfactory to it sufficient to hold it harmless from and against any and all Losses which it may incur by reason of so acting.
- The Escrow Agent may, in addition, elect, in its sole discretion, to commence an interpleader action or seek other judicial relief or apply to the court for an order to pay the Escrow Cash into court or any other orders as it may deem, in its sole discretion, necessary. The costs and expenses (including reasonable legal fees and expenses) incurred in connection with such a proceeding shall be paid by, and shall be deemed a joint and several obligation of, the Parties.
- Escrow Agent’s Power to delegate
The Escrow Agent may employ or appoint, as an agent or otherwise, such persons (if any) as may be necessary or desirable for it to execute any of its powers or perform any of its duties under this Agreement. The Escrow Agent shall not be liable for any acts or omissions of any person it employs or appoints under this clause, subject to the Escrow Agent having acted with due care in selecting that person.
- Notices, instructions and other communications shall be sent:
- In the case of ……………, to it as follows:
- In the case of the Seller, to it as follows:
Attention: [ ]
Email address : [ ]
- In the case of the Buyer/ Depositor, to it as follows:
Attn : [ ]
Email address : [ ]
- Notices, instructions or other communications shall be in writing, in English and shall be given to the address set forth in Clause 13 of this Agreement, or to such other address as may be notified in writing to the Escrow Agent. Notices to the Escrow Agent shall be deemed to be given when actually received in legible form by the Escrow Agent.
- The Escrow Agent is authorized to comply with and rely upon any notices, instructions or other communications, including instructions and directions sent by e-mail, facsimile and other similar unsecured electronic methods (“Electronic Methods”) believed by it to have been sent or given by the Parties or by a person or persons authorized by the Parties.
- The Parties acknowledge that if they elect to use the internet to receive transmissions, such communications are not encrypted and are therefore insecure. The Parties further acknowledge that there are other risks inherent in communicating electronically, such as the possibility of virus contamination and disruptions in services. The Parties agree to assume all risks arising out of the use of Electronic Methods to submit instructions and directions to the Escrow Agent, including, without limitation, the risk of the Escrow Agent acting on unauthorized instructions and the risk of interception and misuse by third parties. The Parties shall be responsible for ensuring that only Authorized Signatories transmit such instructions to the Escrow Agent.
- The Parties undertake to give the Escrow Agent five (5) Business Days’ written notice of any amendment to its respective Authorized Signatories. Until five (5) Business Days after such new document is received, the Escrow Agent shall be fully protected in acting upon the instructions of the previously notified Authorized Signatories.
- Whenever under the terms of this Agreement the time for giving a notice or performing an act falls upon a Saturday, Sunday or banking holiday, such time shall be extended to the next Business Day.
- A “Business Day” is a day on which banks are generally open for business in Kenya
- and, in relation to any date for payment or purchase of a currency, in the principal financial centre of the country of that currency. The term “Business Day” excludes Saturdays, Sundays and banking or public holidays.
- All executed instructions to the Escrow Agent must be received by the Escrow Agent by 10:00 a.m. at least two (2) Business Days prior to the value date of the instruction.
- This Agreement shall terminate upon the distribution of all of the Escrow Cash, or the mutual agreement of the Seller and the Depositor.
- For avoidance of doubt, the termination of the Agreement upon the mutual agreement of the Seller and the Depositor will not affect the Escrow Agent’s entitlement to the Escrow Agent Fee.
- Governing Law and Jurisdiction
- This Agreement shall be interpreted, construed, enforced and administered in accordance with the laws of ……..…
- Each of the Parties hereby submits to the exclusive jurisdiction of the ………. courts.
- Court Order and Legal Requirements
- The Escrow Agent is authorized to provide any information regarding the Escrow Cash which is required by any applicable laws, regulation or rule now or hereafter in effect.
- If at any time the Escrow Agent is served with any judicial, administrative or regulatory order, judgment, decree, writ or other form of judicial, administrative or regulatory process (each an “Order”) which in any way affects the Escrow Cash (including, but not limited to, orders of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of the Escrow Cash or any request issued by any authority having regulatory power over the Escrow Agreement), the Escrow Agent is authorized to comply with the Order in any manner as it, or its legal counsel of its own choosing, deems appropriate and authorized to demand a legal opinion from a counsel of a Party. If the Escrow Agent complies with any such Order, the Escrow Agent shall not be liable to any of the Parties or to any other person or entity, even though such Order may be subsequently modified or vacated or otherwise determined to have been without legal force or effect.
- Exclusivity of the Agreement
- This Agreement is for the exclusive benefit of the Parties and their respective successors under it and shall not be deemed to give, either expressly or impliedly, any legal or equitable right, remedy or claim to any other entity or person whatsoever.
- No Party other than the Parties will have any right under the Contracts (Rights of Third Party) Ordinance to enforce or enjoy the benefit of any provision of this Agreement, unless otherwise stated.
- No Party may assign any of its rights or obligations under this Agreement without the written consent of the other Parties, such consent shall not be unreasonably withheld.
- “Know your client” checks
- The Parties shall promptly, upon the request of the Escrow Agent, supply, or procure the supply of, such documentation and other evidence as is requested by the Escrow Agent in order for the Escrow Agent to carry out and be satisfied that it has complied with all necessary “know your client” and other similar checks under all applicable laws and regulations.
- The Depositor shall promptly, upon the request of the Escrow Agent, supply, or procure the supply of, such documentation, information and other evidence to show that the Escrow Cash is coming from legitimate source and non-criminal origin and is deposited with a reputable bank prior to being remitted to the Escrow Account.
- At all times on and after the termination of this Agreement pursuant to Clause 14, each Party shall maintain and keep the confidentiality of the Confidential Information, and shall not, except with the express prior written consent of the other relevant Parties, directly or indirectly, communicate, disclose, divulge, publish, or otherwise express, to any person, or use for its benefit or the benefit of any person, any Confidential Information, other than to its attorneys, accountants or other professional advisers having a reasonable need to know such information, so long as such third parties agree to maintain the confidentiality of such matters, or to taxing authorities in tax filings, or to any persons as required to enforce the provisions of this Agreement.
- Each Party shall not use the Confidential Information for any purpose other than to exercise its rights or perform its obligations under this Agreement.
- “Confidential Information” means the business affairs, trade secrets, third party confidential information, other sensitive or proprietary information and any exchange between the Parties, whether orally or in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “confidential”, except that such information, at the time of disclosure (a) is or becomes generally available to the public other than as a result of, directly or indirectly, any breach of this Clause 20, (b) is or becomes available to a Party on a non-confidential basis from a third-party source, provided that such third party is not and was not prohibited from disclosing such Confidential Information, (c) is required to be disclosed pursuant to applicable law or order of a competent court.
- This Agreement shall be read together with the SPA. Subject to as otherwise provided in this Agreement, terms and expressions defined in the SPA shall have the same meanings when used herein.
- The headings contained in this Agreement are for convenience of reference only and shall have no effect on the interpretation or operation hereof.
- References in this Agreement to any schedule, section or clause shall be construed as references to the relevant schedule to this Agreement or to the relevant section or clause of this Agreement, respectively. Each schedule forms part of this Agreement and is incorporated herein.
- This Agreement constitutes the entire agreement of the Parties with respect to the subject matter hereof and supersedes all prior oral or written agreements in regard thereto.
- Except as otherwise permitted herein, this Agreement may be modified only by a written amendment signed by all the Parties, and no waiver of any provision hereof shall be effective unless expressed in writing, signed by the Party to be charged.
- All references to day or time of day in this Agreement are references to Nairobi time. Time shall be of the essence of this Agreement, both as regards the dates and periods specifically mentioned and as to any dates and periods which may be substituted by agreement in writing between the Parties.
- The rights and remedies conferred upon the Parties shall be cumulative, and the exercise or waiver of any such right or remedy shall not preclude or inhibit the exercise of any subsequent or additional rights or remedies.
- The invalidity, illegality or unenforceability of any provision of this Agreement shall in no way affect the validity, legality or enforceability of any other provision, and if any provision is held to be unenforceable as a matter of law, the other provisions shall not be affected thereby and shall remain in full force and effect.
- This Agreement may be executed in any number of counterparts, each of which, when so executed and delivered, shall be deemed to be an original, and all such counterparts shall together constitute one agreement.
[Signature page follow]
In Witness Whereof, each of the Parties has caused this Agreement to be executed by a duly authorized officer as of the day and year first written above.
|By: Mr. [ ]||By: Mr. [ ]|
|For and on behalf of||For and on behalf of|
|[ ]||[ ]|
, as Escrow Agent
Name: Mr. To
Title: Managing Partner
Bank Name :
Bank Address :
Account Name :
Account Number :