1
EXHIBIT 10.4
ESCROW AGREEMENT
ESCROW AGREEMENT, made this ____ day of June, 1996, by and among Xxxx
Xxxxxx Financial Group, Inc., a Delaware corporation ("CTFG"), those certain
persons listed on Schedule 7(b) of that certain Share Exchange Agreement dated
June __, 1996 by and among CTFG and such persons (the "Xxxxxx Family") and
represented by the members of the Xxxxxx Family shown on the signature page
hereof and The Northern Trust Company (the "Escrow Agent").
WHEREAS, CTFG and the Xxxxxx Family have entered into a Share Exchange
Agreement (the "Agreement") in respect of the sale by CTFG of all the issued and
outstanding shares of capital stock and ownership interests in Xxxx Xxxxxx Bank
(the "Bank") to the Xxxxxx Family; and
WHEREAS, the Agreement requires that 750,000 shares of CTFG common stock
(the "Escrow Amount") be deposited in escrow by the Xxxxxx Family pending
resolution of certain matters; and
WHEREAS, the Xxxxxx Family agreed to and is prepared to place the Escrow
Amount in escrow with Escrow Agent; and
WHEREAS, the Escrow Agent is prepared to accept the deposit of the Escrow
Amount in escrow.
NOW THEREFORE, the parties agree as follows:
1. Escrow Agent shall open an escrow account on the date hereof in the joint
names of CTFG and the Xxxxxx Family, entitled "CTFG/Xxxxxx Agreement Escrow
Account".
2. The Xxxxxx Family shall deliver the Escrow Amount to Escrow Agent for
deposit into the Escrow Account effective as of the date of the opening of said
Escrow Account.
3. Escrow Agent shall hold the Escrow Amount in escrow until such time as it
receives (i) a final order or judgment of a court of competent jurisdiction
directing the disposition of the Escrow Amount or any part thereof, together
with an opinion of counsel to CTFG or counsel to the Xxxxxx Family to the
effect that such order or judgment is final and not subject to appeal or (ii)
joint written notice from CTFG and the persons whose names appear below as
representatives of the Xxxxxx Family in which event Escrow Agent shall
distribute the Escrow Amount in accordance with the final order or judgment or
the joint written notice, as the case may be. The Escrow Agent shall hold any
interest,
A-1
2
dividends, distributions or other earnings on the Escrow Amount for the sole
benefit of the Xxxxxx Family and shall pay such amounts as instructed in
writing from time to time by the Xxxxxx Family.
4. Any cash funds deposited in the Escrow Account shall be invested by Escrow
Agent in CTFG securities, government securities or certificates of deposit as
instructed by the Xxxxxx Family. CTFG Stock deposited in the Escrow Account
shall be held for investment and shall not be sold or transferred except
pursuant to the requirements of this Escrow Agreement.
5. The duties and responsibilities of the Escrow Agent shall be limited to
those expressly set forth in this Agreement. No implied duties or
discretionary powers may be imputed to it by the terms of this Agreement, or
otherwise. The Escrow Agent shall not be subject to, nor obliged to recognize,
any other instrument governing the rights or duties of the other parties to
this Agreement, even though reference thereto may be made in this Agreement.
6. The Escrow Agent may disregard any and all notices or instructions
received from any source, except only (i) such notices or instructions as are
specifically provided for in this Agreement and (ii) orders or process of any
court of competent jurisdiction. If from time to time any property held
pursuant to this Agreement becomes subject to any order, judgment, decree,
injunction or other judicial process of any court of competent jurisdiction
("Order"), the Escrow Agent may comply with any such Order without liability to
any person, even though such Order may thereafter be annulled, reversed,
modified or vacated.
7. Whenever the Escrow Agent should receive or become aware of any conflicting
demands or claims with respect to this Agreement or the rights of any of the
parties hereto or any property held hereunder, the Escrow Agent may without
liability refrain from any action until the conflict has been resolved or,
alternatively, may tender into the registry or custody of any court which the
Escrow Agent determines to have jurisdiction all money or property in its hands
under this Agreement, together with such legal pleadings as it deems
appropriate, less a reasonable allowance for its outside legal fees and other
reasonable out-of-pocket expenses, and thereupon be discharged from all further
duties and liabilities under this Agreement. Any inaction or filing of
proceedings pursuant to this section shall not deprive the Escrow Agent of its
compensation during such inaction or prior to such filing.
8. Unless otherwise specifically indicated herein the Escrow Agent shall
proceed as soon as practicable to collect any checks or other collection items
at any time deposited hereunder. All
A-2
3
such collections shall be subject to the usual collection agreement regarding
items received by its commercial banking department for deposit or collection.
The Escrow Agent shall have no duty (1) to collect from any party any money,
securities or documents required to be deposited with it, (2) to notify anyone
of any payment or maturity under the terms of any instrument deposited
hereunder, or (3) to take any legal action to enforce payment of any check,
note or security deposited with it.
9. Except as may be specifically provided herein concerning investments of
cash, the Escrow Agent shall have no liability to pay interest on any money
held pursuant to this Agreement. The Escrow Agent may use its own bond
department in purchasing or selling securities. The Escrow Agent shall not be
liable for any depreciation or change in the value of such documents or
securities or any property evidenced thereby or for any losses incurred in
liquidating securities or other property to satisfy a distribution request.
All distributions provided for hereunder shall be made by the Escrow Agent from
the Escrow Amount or any interest, dividends, distributions or other earnings
thereon, subject to any unpaid fees and unreimbursed out-of-pocket expenses of
the Escrow Agent permitted by this Agreement which are then outstanding, in the
order that proper requests therefor are received by the Escrow Agent. In no
event shall the Escrow Agent be required to seek contributions from any source
or to advance its own funds in order to satisfy a distribution request.
10. The Escrow Agent shall not be responsible for any recitals of fact in this
Agreement, or for the sufficiency, form, execution, validity or genuineness of
any documents or securities deposited under this Agreement or for any
signature, endorsement or any lack of endorsement thereon, or for the accuracy
of any description therein, or for the identity, authority or rights of the
persons executing or delivering the same or this Agreement.
11. The Escrow Agent shall be fully protected in relying without investigation
upon any written notice, demand, certificate or document which it in good faith
believes to be genuine, as to the truth and accuracy of the statements made
therein, the identity and authority of the persons executing the same and the
validity of any signature thereon. Although the Escrow Agent may demand
specific authorizations (including corporate resolutions, incumbency
certificates and the like) or identification from a party or its representative
prior to taking any action hereunder, no such demand shall constitute a waiver
or deprive the Escrow Agent of the protections afforded by this paragraph.
12. The Escrow Agent shall not be personally liable for any act taken or
omitted by it under this Agreement in good faith and in the exercise of its own
best judgment. In no event shall the
A-3
4
Escrow Agent be liable to any person for special, indirect or consequential
damages of any kind, even if it is advised of the possibility thereof. The
parties shall jointly and severally indemnify, defend and hold harmless the
Escrow Agent from and against any and all claims that may be asserted against
the Escrow Agent by any third parties and any and all liability, loss, cost or
expense (including outside attorneys' fees in a reasonable amount) that may be
incurred by the Escrow Agent as a result of any such claim or otherwise as a
result of acting as Escrow Agent hereunder unless due to bad faith, gross
negligence or wilful misconduct. The obligations of the parties under this
paragraph shall survive termination of this Agreement and distribution of the
Deposit.
13. The Escrow Agent may engage nationally recognized legal counsel to advise
it concerning any of its duties in connection with this Agreement, or in case
it becomes involved in litigation on account of being Escrow Agent under this
Agreement, and reliance on the advice of such counsel shall fully protect the
Escrow Agent except for any action taken by Escrow Agent in bad faith or do to
its gross negligence or willful misconduct.
14. The Escrow Agent shall be entitled to a fee of $3,000, payable in advance
for each 12-month period or any part thereof, without proration plus
reimbursement for its reasonable expenses, including outside attorneys' fees in
a reasonable amount. The fees and expenses of the Escrow Agent shall be paid
by CTFG.
15. Any notices or communication required or permitted hereunder shall be
sufficiently given if in writing and (a) delivered in person, (b) mailed by
certified or registered mail, postage prepaid or (c) transmitted by facsimile,
as follows:
If to Escrow Agent, addressed to:
The Northern Trust Company
00 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
If to CTFG, addressed to:
Xxxx Xxxxxx Financial Group, Inc.
000 Xxxx Xxxxxx Xxxx
Xxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
With a copy addressed to:
A-4
5
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
If to the Xxxxxx Family, addressed to:
Mr. Xxxxxxx Xxxxxx
00 Xxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Fax: (847)___-____
With a copy addressed to:
XxXxxxxxx, Will & Xxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx
Fax: (000) 000-0000
Whenever under this Agreement the time for giving a notice or performing an
act falls upon a Saturday, Sunday, or holiday, such time shall be extended to
the next business day.
16. Any Escrow Agent may resign by written notice to the other parties to this
Agreement. Any such resignation shall be effective upon delivery of the
property then held in escrow to the successor Escrow Agent, whereupon the
resigning Escrow Agent shall be discharged of any further duties under this
Agreement. If an Escrow Agent resigns, the other parties shall appoint a
successor Escrow Agent; provided that if no successor is appointed within 30
days after resignation, the resigning Escrow Agent may appoint as successor any
corporation with trust powers in the United States or may tender the Deposit
into court as provided in paragraph 4.3 hereof.
17. The Escrow Agent shall not be responsible for any delays or failure to
perform caused by circumstances reasonably beyond its control, including but
not limited to breaches by other parties of their obligations hereunder, delays
by messengers or other independent contractors, mechanical or computer
failures, malfunctioning or breakdowns in public utilities, securities
exchanges, Federal Reserve Banks, or securities depositories; interference by
governmental units; strikes, lockouts, or civil disobedience; fires or other
casualties, acts of God or other similar occurrences.
18. The rights and duties of CTFG and the Xxxxxx Family to each other shall be
governed by the laws of the state of Delaware. The rights and duties of the
Escrow Agent shall be determined in
A-5
6
accordance with the laws of the State of Illinois without reference to its
conflict of law principles. This Agreement shall be deemed to be a contract
made and to be performed in the State of Illinois.
19. This Agreement may be amended from time to time by written instrument
executed by all the parties other than the Escrow Agent; provided that duties
and liabilities of the Escrow Agent may not thereby be changed without its
prior written consent.
20. This Agreement shall benefit, and be binding upon, only the parties hereto
and their respective heirs, estates, successors and assigns (each a "Party").
Nothing in this Agreement shall be construed to give any right against the
Escrow Agent to any person who is not a Party. The Escrow Agent shall have no
duty, express or implied, to any non-Party and no such person shall be deemed a
"third party beneficiary" of this Agreement.
21. The Escrow Agent shall furnish CTFG and the Xxxxxx Family upon the request
of either CTFG or the Xxxxxx Family with a report showing receipts and
disbursements during the period and a priced list of (publicly traded) assets.
Valuations appearing on such reports or otherwise utilized hereunder may be
obtained from third parties generally recognized as sources of pricing
information, but the Escrow Agent shall not be liable for the accuracy of
valuations furnished by recognized pricing sources.
22. This Agreement contains the entire agreement among the parties hereto with
respect to the subject matter hereof and may not be amended or modified in any
manner except by an instrument signed by all parties hereto.
* * *
A-6
7
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
XXXX XXXXXX FINANCIAL GROUP, INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
"XXXXXX FAMILY" REPRESENTATIVES
-------------------------------------
Xxxxxx Xxxxxx
-------------------------------------
Xxxxxxx Xxxxxx
-------------------------------------
Xxxxx Xxxxxx
-------------------------------------
Xxxx Xxxxxx
THE NORTHERN TRUST COMPANY
By:
-------------------------
Name:
------------------------
Title:
-----------------------
A-7
