Exhibit 99.10
Chase Contact: Xxxx Xxxxx 000-000-0000
SUBSCRIPTION ESCROW AGREEMENT
Subscription Escrow Agreement (the "Escrow Agreement") dated as of
the effective date (the "Effective Date") set forth on schedule 1 attached
hereto ("Schedule 1") among the corporation identified on Schedule 1 (the
"Issuer"), the corporation identified on Schedule 1 (the "Subscription
Agent") and The Chase Manhattan Bank, as escrow agent hereunder (the
"Escrow Agent").
Whereas, the Issuer has filed a registration statement on Form S-1 under
the Securities Act of 1933, as amended, with the Securities and Exchange
Commission, File No. 333-61212 (the "Registration Statement"), relating to
the subscription for and sale of 1,060,000 shares ("Shares") of common
stock, par value $1.00 per share, of the Issuer in a rights offering to the
shareholders of Commercial Bank of New York (the "Offering") at a
subscription price of $10.00 per Share;
WHEREAS, Sandler X'Xxxxx Shareholder Services, a division of Sandler
X'Xxxxx & Partners, L.P. will act as subscription agent in connection with
the proposed offering of the Shares; and
WHEREAS, in compliance with Rule 15c2-4 under the Securities Exchange Act
of 1934, as amended, and Rule 2720(e) of the NASD Conduct Rules, the Issuer
proposes to establish an escrow fund to be held by the Escrow Agent until
the sale of Shares in the Offering terminates and the requirements of NASD
Conduct Rule 2720(e) are satisfied;
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants hereinafter set forth, the parties hereto agree as follows:
1. Appointment. The Issuer hereby appoints the Escrow Agent as its escrow
agent for the purposes set forth herein, and the Escrow Agent hereby
accepts such appointment under the terms and conditions set forth herein.
2. Escrow Fund. All funds received by the Subscription Agent and the Issuer
in connection with the sale of Shares shall be deposited with the Escrow
Agent (the "Escrow Deposit"). The Escrow Agent shall hold the Escrow
Deposit (the "Escrow Fund") in a non-interest bearing account.
3. Disposition and Termination. The Subscription Agent and the Issuer agree
to notify the Escrow Agent of the closing date of the Offering (the
"Offering Closing Date"). Upon receipt of such notification the following
procedure will take place.
(i) If the Issuer notifies the Escrow Agent that it has been advised
by the National Association of Securities Dealers, Inc. ("NASD")
that it has complied with the net capital ratio requirements of
Rule 2720(e) of the NASD Conduct Rules, the Escrow Fund will be
promptly paid to or credited to the account of, or otherwise
transferred to the Issuer pursuant to instructions from the
Issuer, subject to any fees, costs and expenses owed to the Escrow
Agent pursuant to Section 5 and 6.
(ii) If the Issuer notifies the Escrow Agent that it has failed to
comply with the net capital requirements of Rule 2720(e) of the
NASD Conduct Rules, the Escrow Agent shall be provided with a list
containing the amount received from each subscriber whose funds
have been deposited with the Escrow Agent (with respect to each
subscriber the "Subscriber Investment Amount") and the name and
address of each subscriber. The Escrow Agent shall distribute to
each subscriber the appropriate Subscriber Investment Amount
within 7 days of receipt of the information described in this
Section 3 (ii).
Upon delivery of the Escrow Fund to the Issuer or the subscribers as the
case may be, by the Escrow Agent, this Escrow Agreement shall terminate,
subject to the provisions of Section 8.
4. Escrow Agent. The Escrow Agent undertakes to perform only such duties as
are expressly set forth herein and no duties shall be implied. The Escrow
Agent shall have no liability under and no duty to inquire as to the
provisions of any agreement other than this Escrow Agreement. The Escrow
Agent may rely upon and shall not be liable for acting or refraining from
acting upon any written notice, instruction or request furnished to it
hereunder and believed by it to be genuine and to have been signed or
presented by the proper party or parties. The Escrow Agent shall be under
no duty to inquire into or investigate the validity, accuracy or content of
any such document. The Escrow Agent shall have no duty to solicit any
payments which may be due it or the Escrow Fund. The Escrow Agent shall not
be liable for any action taken or omitted by it in good faith except to the
extent that a court of competent jurisdiction determines that the Escrow
Agent's gross negligence or willful misconduct was the primary cause of any
loss to the Issuer. The Escrow Agent may execute any of its powers and
perform any of its duties hereunder directly or through agents or attorneys
(and shall be liable only for the careful selection of any such agent or
attorney) and may consult with counsel, accountants and other skilled
persons to be selected and retained by it. The Escrow Agent shall not be
liable for anything done, suffered or omitted in good faith by it in
accordance with the advice or opinion of any such counsel, accountants or
other skilled persons. In the event that the Escrow Agent shall be
uncertain as to its duties or rights hereunder or shall receive
instructions, claims or demands from any party hereto which, in its
opinion, conflict with any of the provisions of this Escrow 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 until it shall be
directed otherwise in writing by all of the other parties hereto or by a
final order or judgment of a court of competent jurisdiction. Anything in
this Escrow Agreement to the contrary notwithstanding, in no event shall
the Escrow Agent be liable for special, 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 loss or
damage and regardless of the form of action.
5. Succession. If the Escrow Fund is to be distributed to the Issuer
pursuant to Section 3(i) above, the Escrow Agent shall have the right to
withhold an amount equal to any amount due and owing to the Escrow Agent,
plus any costs and expenses the Escrow Agent shall reasonably believe may
be incurred by the Escrow Agent in connection with the termination of the
Escrow Agreement. Any corporation into which the Escrow Agent may be merged
or converted or with which it may be consolidated, or any corporation to
which substantially all the escrow business of the Escrow Agent's corporate
trust line of business may be transferred, shall be the Escrow Agent under
this Escrow Agreement without further act.
6. Fees. The Issuer agrees to (i) pay the Escrow Agent upon execution of
this Agreement and from time to time thereafter reasonable compensation for
the services to be rendered hereunder, which unless otherwise agreed in
writing shall be as described in Schedule 1 attached hereto, and (ii) pay
or reimburse the Escrow Agent upon request for all expenses, disbursements
and advances, including reasonable attorney's fees and expenses, incurred
or made by it in connection with the preparation, execution, performance,
delivery modification and termination of this Agreement.
7. Indemnity. The Issuer shall indemnify, defend and save harmless the
Escrow Agent and its directors, officers, agents and employees (the
"indemnitees") from all loss, liability or expense (including the fees and
expenses of in house or outside counsel) arising out of or in connection
with (i) the Escrow Agent's execution and performance of this Escrow
Agreement, except in the case of any indemnitee to the extent that such
loss, liability or expense is due to the gross negligence or willful
misconduct of such indemnitee, or (ii) its following any instructions or
other directions from the Issuer , except to the extent that its following
any such instruction or direction is expressly forbidden by the terms
hereof. The parties hereto acknowledge that the foregoing indemnities shall
survive the resignation or removal of the Escrow Agent or the termination
of this Escrow Agreement.
8. TINs. The Issuer represents that its correct Taxpayer Identification
Number ("TIN") assigned by the Internal Revenue Service or any other taxing
authority is set forth in Schedule 1. All interest or other income earned
under the Escrow Agreement shall be allocated and/or paid as directed in a
written direction of the Issuer and reported by the recipient to the
Internal Revenue Service or any other taxing authority. Notwithstanding
such written directions, Escrow Agent shall report and, as required
withhold any taxes as it determines may be required by any law or
regulation in effect at the time of the distribution. In the event that any
earnings remain undistributed at the end of any calendar year, Escrow Agent
shall report to the Internal Revenue Service or such other authority such
earnings as it deems appropriate or required by any applicable law or
regulation or, to the extent consistent therewith, as directed in writing
by the Issuer and the Depositor. In addition, Escrow Agent shall withhold
any taxes it deems appropriate and shall remit such taxes to the
appropriate authorities.
9. Notices. All communications hereunder shall be in writing and shall be
deemed to be duly given if sent by prepaid registered mail, return receipt
requested, to the appropriate notice address set forth on Schedule 1 or at
such other address as any party hereto may have furnished to the other
parties in writing by registered mail, return receipt requested and any
such notice or communication given in the manner specified in this Section
10 shall be deemed to have been given as of the date so mailed, except that
communications to the Escrow Agent shall be deemed to have been given on
the date received by the Escrow Agent. In the event that the Escrow Agent,
in its sole discretion, shall determine that an emergency exists, the
Escrow Agent may use such other means of communication as the Escrow Agent
deems advisable.
10. Security Procedures. In the event funds transfer instructions are given
(other than in writing at the time of execution of this Escrow Agreement),
whether in writing, by telecopier or otherwise, the Escrow Agent is
authorized to seek confirmation of such instructions by telephone call-back
to the person or persons designated on schedule 2 hereto ("Schedule 2"),
and the Escrow Agent may rely upon the confirmations of anyone purporting
to be the person or persons so designated. The persons and telephone
numbers for call-backs may be changed only in a writing actually received
and acknowledged by the Escrow Agent. The Escrow Agent and the
beneficiary's bank in any funds transfer may rely solely upon any account
numbers or similar identifying numbers provided by the Issuer or the
Depositor to identify (i) the beneficiary, (ii) the beneficiary's bank, or
(iii) an intermediary bank. The Escrow Agent may apply any of the escrowed
funds for any payment order it executes using any such identifying number,
even where its use may result in a person other than the beneficiary being
paid, or the transfer of funds to a bank other than the beneficiary's bank
or an intermediary bank designated.
11. Miscellaneous. The provisions of this Escrow Agreement may be waived,
altered, amended or supplemented, in whole or in part, only by a writing
signed by all of the parties hereto. Neither this Escrow Agreement nor any
right or interest hereunder may be assigned in whole or in part by any
party, except as provided in Section 5, without the prior consent of the
other parties. This Escrow Agreement shall be governed by and construed
under the laws of the jurisdiction listed as the jurisdiction in Schedule
1. Each party hereto irrevocably waives any objection on the grounds of
venue, forum non-conveniens or any similar grounds and irrevocably consents
to service of process by mail or in any other manner permitted by
applicable law and consents to the non-exclusive jurisdiction of the courts
located in such jurisdiction. The parties further hereby waive any right to
a trial by jury with respect to any lawsuit or judicial proceeding arising
or relating to this Escrow Agreement. No party to this Escrow Agreement is
liable to any other party for losses due to, or if it is unable to perform
its obligations under the terms of this Escrow Agreement because of, acts
of God, fire, floods, strikes, equipment or transmission failure, or other
causes reasonably beyond its control. This Escrow Agreement may be executed
in one or more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument. All
signatures of the parties to this Agreement may be transmitted by
facsimile, and such facsimile will, for all purposes, be deemed to be the
original signature of such party whose signature it reproduces, and will be
binding upon such party.
IN WITNESS WHEREOF, the parties hereto have executed this Escrow Agreement
as of the date set forth in Schedule 1.
THE CHASE MANHATTAN BANK
as Escrow Agent
By:__________________________________
ISSUER
By:__________________________________
SUBSCRIPTION AGENT
SANDLER X'XXXXX SHAREHOLDER SERVICES
a division of Sandler X'Xxxxx & Partners, L.P.
By: Sandler X'Xxxxx & Partners Corp.,
the sole general partner
By:_______________________________
Name: ____________________________
Its: _______________________________
Schedule 1
Effective Date: __________, 2001
Name of Issuer: CBNY Investment Services Corp.
Issuer Notice Address: 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx
Tel No.: (000) 000 0000
Fax No.: (000) 000 0000
Issuer TIN: 00-0000000
Name of Subscription Agent: Sandler X'Xxxxx Shareholder Services,
a division of Sandler X'Xxxxx &
Partners, L.P.
Notice Address: c/o Sandler X' Xxxxx & Partners, L.P.
0 Xxxxx Xxxxx Xxxxxx
000xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxxxx,
General Counsel
Tel No.: (000) 000-0000
Fax No.: (000) 000-0000
Escrow Agent notice address: The Chase Manhattan Bank
Institutional Trust Services
000 Xxxx 00xx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxxxx, AVP
Tel No: (000) 000-0000
Fax No.: (000) 000-0000
Jurisdiction: New York
Escrow Agent's compensation: $7,500 per annum or any part thereof
without pro-ration for partial years
Schedule 2
Telephone Number(s) for Call-Backs and
Person(s) Designated to Confirm Funds Transfer Instructions
If to Issuer:
Name Telephone Number
1. ______________________ _______________________
2. ______________________ _______________________
3. ______________________ _______________________
If to Subscription Agent:
Name Telephone Number
1. ______________________ _______________________
2. ______________________ _______________________
3. ______________________ _______________________
Telephone call-backs shall be made to each of the Issuer and the
Subscription Agent if joint instructions are required pursuant to this
Escrow Agreement.
