Exhibit 1.2
ESCROW AGREEMENT
THIS ESCROW AGREEMENT, dated as of October 10, 1996 ("Escrow
Agreement"), is by and between Xxxxx Xxxxxx Associates, Inc., a New York
corporation ("Agent"); Apple Residential Income Trust, Inc., a Virginia
corporation ("Company"); and FIRST UNION NATIONAL BANK OF NORTH CAROLINA, a
national banking association, as Escrow Agent hereunder ("Escrow Agent").
BACKGROUND
A. Company has engaged Agent to sell up to 25,166,666.67 in shares of
Common Stock, no par value (the "Shares"), with a minimum required investment of
$5,000 in Shares ($2,000 in Shares in the case of Qualified Plans, as defined
therein) at a price of $9.00 per share until the Minimum Offering of $15,000,000
is achieved and thereafter $10.00 per share (the "Shares") on a "best efforts"
basis, pursuant to Registration Statement No. 333-10635 filed with the
Securities and Exchange Commission (the "SEC") which includes a Prospectus, as
supplemented and amended from time to time (the "Offering Document").
B. In accordance with the Offering Document, subscribers to the Shares
(the "Subscribers" and individually, a "Subscriber") will be required to submit
full payment for their respective investments at the time they enter into
subscription agreements.
C. In accordance with the Offering Document, all payments received by
Agent on or before sale of the Minimum Offering amount (as defined in the
Offering Document) in connection with subscriptions for Shares shall be promptly
forwarded to Escrow Agent, and Escrow Agent has agreed to accept, hold, and
disburse such funds deposited with it and the earnings thereon in accordance
with the terms of this Escrow Agreement.
D. In order to establish the escrow of funds and to effect the
provisions of the Offering Document, the parties hereto have entered into this
Escrow Agreement.
STATEMENT OF AGREEMENT
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, for
themselves, their successors and assigns, hereby agree as follows:
1. Definitions. The following terms shall have the following meanings
when used herein:
"Agent" shall mean Xxxxx Xxxxxx Associates, Inc., and/or any
selected dealer participating at a later date.
"Cash Investment" shall mean the number of Shares to be purchased
by any Subscriber multiplied by the offering price per share of $9.00 until the
Minimum Offering is achieved and thereafter $10.00 as set forth in the Offering
Document.
"Cash Investment Instrument" shall mean a check, money order or
similar instrument, made payable to "First Union National Bank, Escrow Agent"
and referencing the Agent's account number in full payment for the Shares to be
purchased by any Subscriber.
"Escrow Funds" shall mean the funds deposited with the Escrow
Agent pursuant to this Agreement, together with any interest and other income
thereon.
"Minimum Offering" shall mean the sale of $15,000,000 in Shares at
$9.00 per Share (1,666,666.67 Shares) by the Company in the offering made by the
Offering Document.
"Pro Rata Basis," with respect to the allocation among Subscribers
of interest and other earnings held in the Escrow Funds, shall mean, for each
Subscriber, the Subscriber's Cash Investment multiplied by the number of
calendar days the Cash Investment of such Subscriber was held in
interest-bearing investments pursuant to Section 6 hereof, multiplied by the
average yield earned on the Escrow Funds during such period of days.
"Shares" shall have the meaning set forth in the section of this
Escrow Agreement titled "Background."
"Subscriber" or "Subscribers" shall have the meaning set forth in
the section of this Escrow Agreement titled "Background."
"Subscription Accounting" shall mean an accounting of all
subscriptions for Shares received by Agent as of the date of such accounting,
indicating for each subscription the Subscriber's name, social security number
and address, the number and total purchase price of subscribed Shares, the date
of receipt by Agent of the Cash Investment Instrument, and notations of any
nonpayment of the Cash Investment Instrument submitted with such subscription,
any withdrawal of such subscription by the Subscriber, any rejection of such
subscriber by Company, or other termination, for whatever reason, of such
subscription.
2. Appointment of and Acceptance by Escrow Agent. Company and Agent
hereby appoint Escrow Agent to serve as escrow agent hereunder, and Escrow Agent
hereby accepts such appointment in accordance with the terms of this Escrow
Agreement.
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3. Deposits into Escrow
a. Upon receipt by Agent of any Cash Investment Instrument for the
purchase of Shares, Agent shall forward to Escrow Agent the Cash Investment
Instrument for deposit into the following escrow account:
First Union National Bank of North Carolina, Escrow Agent
Charlotte, North Carolina
ABA # 000000000
ATTN: Xxxxx Xxxxxxxx
for Apple Residential Income Trust, Inc. Escrow Account
Notify (000) 000-0000
Each such deposit shall be accompanied by the following
document:
(1) A Subscription Accounting
The Escrow Agent is under no obligation to accept deposits from anyone
other than the Agent. If a deposit is received by 12:00 P.M. on a given business
day, it will be accepted that business day; otherwise it will be accepted on the
next business day.
ALL FUNDS SO DEPOSITED SHALL REMAIN THE PROPERTY OF THE
SUBSCRIBERS ACCORDING TO THEIR RESPECTIVE INTERESTS AND SHALL NOT BE SUBJECT TO
ANY LIEN OR CHARGE BY ESCROW AGENT OR BY JUDGMENT OR CREDITORS' CLAIMS AGAINST
COMPANY UNTIL RELEASED TO COMPANY IN ACCORDANCE WITH SECTION 4(a) HEREOF.
b. Agent and Company understand and agree that all checks and
similar instruments received by Escrow Agent hereunder are subject to collection
requirements of presentment and final payment, and that the funds represented
thereby cannot be drawn upon or disbursed until such time as final payment has
been made and is not longer subject to dishonor. Upon receipt, Escrow Agent
shall process each Cash Investment Instrument for collection, and the proceeds
thereof shall be held as part of the Escrow Funds until disbursed in accordance
with Section 4 hereof. If, upon presentment for payment, any Cash Investment
Instrument is dishonored, Escrow Agent's sole obligation shall be to notify
Agent of such dishonor and to return such Cash Investment Instrument to Agent to
take whatever action it deems necessary. Notwithstanding the foregoing, if for
any reason any Cash Investment Instrument is uncollectible after payment of the
funds represented thereby has been made by Escrow Agent, the party
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receiving such funds shall immediately reimburse Escrow Agent upon receipt from
Escrow Agent of written notice thereof (period of notification is not to exceed
10 business days).
Upon receipt of any Cash Investment Instrument that represents
payment less than or greater than the Cash Investment, Escrow Agent's sole
obligation shall be to notify Company and Agent of such fact and to return such
Cash Investment Instrument to Agent.
c. All Cash Investment Instruments shall be made payable to the
order of, or endorsed to the order of, "First Union National Bank, Escrow Agent"
and Escrow Agent shall not be obligated to accept, or present for payment, any
Cash Investment Instrument that is not payable or endorsed in that manner.
4. Disbursements of Escrow Funds.
a. Generally. Subject to the provisions of Section 10 hereof,
Escrow Agent shall pay to Company the liquidated value of the Escrow Funds, by
certified or bank check or by wire transfer, no later than ten (10) days
following receipt of the following documents:
(1) A request in writing from the Company for disbursement,
including a statement that the conditions, if any, to
disbursement described in the Offering Document have
been satisfied; and
(2) Such other certificates and notices as Escrow Agent
shall reasonably require.
b. Rejection of Any Subscription or Termination of the Offering.
No later than fifteen (15) business days after receipt by Escrow Agent of
written notice (i) from Company or Agent that Company intends to reject a
Subscriber's subscription, or (ii) that a subscriber has revoked his
subscription or (iii) from the SEC or any other federal or state regulatory
authority that a stop order has been issued with respect to the Offering
Document and has remained in effect for at least twenty (20) days, Escrow Agent
will, upon written instructions given by the Company, transmit to the Agent that
portion of the escrowed funds attributable to such subscriber or subscribers
affected by such event, or equal to the amount of the reduction, as the case may
be, with interest, and the Agent shall promptly deposit such funds directly to
the account of the subscriber entitled thereto, each Subscriber's share of
interest to be calculated on a Pro Rata Basis.
c. Interest. All interest earned on investments is payable to the
Subscribers, less the investment sweep fee prorated by investor in accordance
with the length of time of their escrow deposit.
5. Suspension of Performance or Disbursement Into Court. If, at any
time, there shall exist any dispute between Agent, Company, Escrow Agent, any
Subscriber or any other person with respect to the holding or disposition of any
portion of the Escrow Funds or any
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other obligations of Escrow Agent hereunder, or if at any time Escrow Agent is
unable to determine, to Escrow Agent's sole satisfaction, the proper disposition
of any portion of the Escrow Funds or Escrow Agent's proper actions with respect
to its obligations hereunder, or if Agent and Company have not within 30 days of
the furnishing by Escrow Agent of a notice of resignation pursuant to Section 7
hereof appointed a successor Escrow Agent to act hereunder, then Escrow Agent
may, in its sole discretion, take either or both of the following actions:
a. Suspend the performance of any of its obligations under this
Escrow Agreement until such dispute or uncertainty shall be resolved to the sole
satisfaction of Escrow Agent or until a successor Escrow Agent shall have been
appointed (as the case may be); provided however, that Escrow Agent shall
continue to invest the Escrow Funds in accordance with Section 6 hereof; and/or
b. Petition (by means of an interpleader action or any other
appropriate method) any court of competent jurisdiction in Charlotte, North
Carolina, for instructions with respect to such dispute or uncertainty, and pay
into such court all funds held by it in the Escrow Funds for holding and
disposition in accordance with the instructions of such court.
Escrow Agent shall have no liability to Agent, Company, any Subscriber
or any other person with respect to any such suspension of performance or
disbursement into court, specifically including any liability or claimed
liability that may arise, or be alleged to have arisen, out of or as a result of
any delay in the disbursement of funds held in the Escrow Funds or any delay in
or with respect to any other action required or requested of Escrow Agent.
6. Investment of Funds. Escrow Agent shall invest and reinvest the
Escrow Funds as Company shall direct (subject to applicable minimum investment
requirements) in writing; provided, however, that no investment or reinvestment
may be made except in the following:
a. Short-term direct obligations of the United States of America
or obligations the principal of and the interest on which are unconditionally
guaranteed by the United States of America; or
b. Short-term certificates of deposit issued by any bank (as
defined in Section 3(a)(6) of the Securities Exchange Act of 1934) (including
Escrow Agent and its affiliates) having a net worth of at least $50,000,000 or
c. If, but only if, such investment or reinvestment occurs after
sale of the Minimum Offering amount, bank repurchase agreements covering the
securities of the United States government or United States governmental
agencies issued by banks located in the United States having a net worth of at
least $50,000,000 or
d. If, but only if, such investment or reinvestment occurs after
sale of the Minimum Offering amount, banker's acceptances, prime commercial
paper or similarly highly
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liquid investments (such as money market funds selected by the Company,
including those of the Escrow Agent and its affiliates)
If Escrow Agent has not received written instructions from Company at
any time that an investment decision must be made, Escrow Agent shall invest the
Escrow Funds, or such portion thereof as to which no written instructions have
been received, in investments described in clause (b) above. Each of the
foregoing investments shall be made in the name of Escrow Agent in its stated
capacity as escrow agent. No investment shall be made in any instrument or
security that has a maturity of greater than three (3) months. Notwithstanding
anything to the contrary contained herein, Escrow Agent may, without notice to
Company or Agent, sell or liquidate any of the foregoing investments at any time
if the proceeds thereof are required for any release of funds permitted or
required hereunder, and Escrow Agent shall not be liable or responsible for any
loss, cost or penalty resulting from any such sale or liquidation. With respect
to any funds received by Escrow Agent for deposit into the Escrow Funds or any
written investment instruction of Company received by Escrow Agent after ten
o'clock, a.m., Charlotte, North Carolina, time, Escrow Agent shall not be
required to invest such funds or to effect such investment instruction until the
next day upon which banks in Charlotte, North Carolina, are open for business.
The Escrow Agent shall deliver to Company, upon request by Company, an
accounting of all funds held in escrow pursuant to this Agreement, to the extent
such funds have not been previously paid over by the Escrow Agent.
7. Resignation and Removal of Escrow Agent.
a. Escrow Agent may resign from the performance of its duties
hereunder at any time by giving thirty (30) days' prior written notice to Agent
and Company or may be removed, with or without cause, by Agent and Company,
acting jointly in writing, at any time by the giving of thirty (30) days' prior
written notice to Escrow Agent. Such resignation or removal shall take effect
upon the appointment of a successor Escrow Agent as provided hereinbelow. Upon
any such notice of resignation or removal, Agent and Company jointly shall
appoint a successor Escrow Agent hereunder, which shall be a bank (as defined in
Section 3(a)(6) of the Securities Exchange Act of 1934). Upon the acceptance in
writing of any appointment as Escrow Agent hereunder by a successor Escrow
Agent, such successor Escrow Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Escrow Agent,
and the retiring Escrow Agent shall be discharged from its duties and
obligations under this Escrow Agreement, but shall not be discharged from any
liability for actions taken as escrow agent hereunder prior to such succession.
After any retiring Escrow Agent's resignation or removal, the provisions of this
Escrow Agreement shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Escrow Agent under this Escrow Agreement.
b. Notwithstanding anything to the contrary in this Escrow
Agreement, at any time after Shares representing the Minimum Offering have been
sold (and the
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corresponding Escrow Funds disbursed in accordance with this Escrow Agreement),
Company and Agent, by ten (10) days' prior written notice to Escrow Agent, may
terminate this Escrow Agreement. Any Escrow Funds remaining at the time of
termination of this Escrow Agreement shall be disbursed in accordance with
Section 4 hereof.
8. Liability of Escrow Agent. Escrow Agent shall have no liability or
obligation with respect to the Escrow Funds except for Escrow Agent's willful
misconduct or gross negligence. Escrow Agent's sole responsibility shall be for
the safekeeping, investment, and disbursement of the Escrow Funds in accordance
with the terms of this Escrow Agreement. Escrow Agent shall have no implied
duties or obligations and shall not be charged with knowledge or notice of any
fact or circumstance not specifically set forth herein or in a written notice
provided hereunder. Escrow Agent may rely upon any instrument, not only as to
its due execution, validity and effectiveness, but also as to the truth and
accuracy of any information contained therein which Escrow Agent shall in good
faith believe to be genuine, to have been signed or presented by the person or
parties purporting to sign the same and to conform to the provisions of this
Escrow Agreement. In no event shall Escrow Agent be liable for incidental,
indirect, special, consequential or punitive damages. Escrow Agent shall not be
obligated to take any legal action or commence any proceeding in connection with
the Escrow Funds or any account in which Escrow Funds are deposited or this
Escrow Agreement, or to appear in, prosecute or defend any such legal action or
proceeding. Without limiting the generality of the foregoing, Escrow Agent shall
not be responsible for or required to enforce any of the terms or conditions of
any subscription agreement with any Subscriber or any other agreement between
Company, Agent and/or any Subscriber. Escrow Agent shall not be responsible or
liable in any manner for the performance by Company or any Subscriber of their
respective obligations under any subscription agreement nor shall Escrow Agent
be responsible or liable in any manner for the failure of Company, Agent or any
third party (including any Subscriber) to honor any of the provisions of this
Escrow Agreement. Escrow Agent may consult legal counsel selected by it in the
event of any dispute or question as to the construction of any of the provisions
hereof or of any other agreement or of its duties hereunder, and shall incur no
liability and shall be fully protected from any liability whatsoever in acting
in accordance with the opinion or instruction of such counsel. Company shall
promptly pay, upon demand, the reasonable fees and expenses of any such counsel.
9. Indemnification of Escrow Agent. From and at all times after the
date of this Escrow Agreement, Company shall, to the fullest extent permitted by
law, indemnify and hold harmless the Escrow Agent and each director, officer,
employee, attorney, agent and affiliate of Escrow Agent (collectively, the
"Indemnified Parties") against any and all actions, claims (whether or not
valid), losses, damages, liabilities, costs and expenses of any kind or nature
whatsoever (including without limitation reasonable attorneys' fees, costs and
expenses) incurred by or asserted against any of the Indemnified Parties from
and after the date hereof, whether direct, indirect or consequential, as a
result of or arising from or in any way relating to any claim, demand, suit,
action or proceeding (including any inquiry or investigation) by any person,
whether threatened or initiated, asserting a claim for any legal or equitable
remedy against any person under any statute or regulation, including, but not
limited to, any federal or state
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securities laws, or under any common law or equitable cause or otherwise,
arising from or in connection with the negotiation, preparation, execution,
performance or failure of performance of this Escrow Agreement or any
transactions contemplated herein, whether or not any such Indemnified Party is a
party to any such action, proceeding, suit or the target of any such inquiry or
investigation; provided, however, that no Indemnified Party shall have the right
to be indemnified hereunder for any liability finally determined by a court of
competent jurisdiction, subject to no further appeal, to have resulted solely
from the gross negligence or willful misconduct of such Indemnified Party. If
any such action or claim shall be brought or asserted against any Indemnified
Party, such Indemnified Party shall promptly notify Company in writing, and
Company shall assume the defense thereof, including the employment of counsel
and the payment of all expenses. Such Indemnified Party shall, in its sole
discretion, have the right to employ separate counsel in any such action and to
participate in the defense thereof, and the fees and expenses of such counsel
shall be paid by such Indemnified Party unless (a) Company agrees to pay such
fees and expenses, or (b) Company shall fail to assume the defense of such
action or proceeding or shall fail, in the reasonable discretion of such
Indemnified Party, to employ counsel satisfactory to the Indemnified Party in
any such action or proceeding, or (c) the named parties to any such action or
proceeding (including any impleaded parties) include both Indemnified Party and
Company, and Indemnified Party shall have been advised by counsel that there may
be one or more legal defenses available to it which are different from or
additional to those available to Company. All such fees and expenses payable by
Company pursuant to the foregoing sentence shall be paid from time to time as
incurred, both in advance of and after the final disposition of such action or
claim. The obligations of Company under this Section 9 shall survive any
termination of this Escrow Agreement and the resignation or removal of Escrow
Agent.
10. Compensation to Escrow Agent.
a. Fees and Expenses. Company shall compensate Escrow Agent for
its services hereunder in accordance with Exhibit A attached hereto and, in
addition, shall reimburse Escrow Agent for all of its reasonable out-of-pocket
expenses, including attorneys' fees, travel expenses, telephone and facsimile
transmission costs, postage (including express mail and overnight delivery
charges), copying charges and the like. All of the foregoing compensation and
reimbursement obligations shall be payable by Company upon demand by Escrow
Agent. The obligations of Company under this Section 10 shall survive any
termination of this Escrow Agreement and the resignation or removal of Escrow
Agent.
b. Disbursements from Escrow Funds to Pay Escrow Agent. The Escrow
Agent is authorized to and may disburse from time to time, to itself or to any
Indemnified Party from the Escrow Funds (but only to the extent of Company's
rights thereto), the amount of any compensation and reimbursement of
out-of-pocket expenses due and payable hereunder (including any amount to which
Escrow Agent or any Indemnified Party is entitled to seek indemnification
pursuant to Section 9 hereof). Escrow Agent shall, prior to disbursement, notify
Company of any disbursement from the Escrow Funds to itself or to any
Indemnified Party in
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respect of any compensation or reimbursement hereunder and shall furnish to
Issuer copies of all related invoices and other statements.
c. Security and Offset. Company hereby grants to Escrow Agent and
the Indemnified Parties a security interest in and lien upon the Escrow Funds
(but only to the extent of Company's rights thereto) to secure all obligations
hereunder, and Escrow Agent and the Indemnified Parties shall have the right to
offset the amount of any compensation or reimbursement due any of them hereunder
(including any claim for indemnification pursuant to Section 9 hereof) against
the Escrow Funds (but only to the extent of Company's rights thereto.) If for
any reason the Escrow Funds available to Escrow Agent and the Indemnified
Parties pursuant to such security interest or right of offset are insufficient
to cover such compensation and reimbursement, Company shall promptly pay such
amounts to Escrow Agent and the Indemnified Parties upon receipt of an itemized
invoice.
11. Representations and Warranties
a. Company makes the following representations and warranties to
Escrow Agent:
(1) Company is a corporation duly organized, validly existing,
and in good standing under the laws of the State of Virginia, and has full power
and authority to execute and deliver this Escrow Agreement and to perform its
obligations hereunder;
(2) This Escrow Agreement has been duly approved by all
necessary corporate action of Company, including any necessary shareholder
approval, has been executed by duly authorized officers of Company, and
constitutes a valid and binding agreement of Company, enforceable in accordance
with its terms.
(3) The execution, delivery, and performance by Company of this
Escrow Agreement will not violate, conflict with, or cause a default under the
articles of incorporation or bylaws of Company, any applicable law or regulation
applicable to the Company, any court order or administrative ruling or decree to
which Company is a party or any of its property is subject, or any agreement,
contract, indenture, or other binding arrangement to which Company is a party or
any of its property is subject. The execution, delivery and performance of this
Escrow Agreement is consistent with and accurately described in the Offering
Document, and the allocation of interest and other earnings to Subscribers, as
set forth in Section 4 hereof, has been properly described therein.
(4) No party other than the parties hereto and the prospective
Subscribers have, or shall have, any lien, claim or security interest in the
Escrow Funds or any part thereof. No financing statement under the Uniform
Commercial Code is on file in any jurisdiction claiming a security interest in
or describing (whether specifically or generally) the Escrow Funds or any part
thereof.
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(5) Company hereby acknowledges that the status of Escrow Agent
is that of agent only for the limited purposes set forth herein, and hereby
represents and covenants that no representation or implication shall be made
that the Escrow Agent has investigated the desirability or advisability of
investment in the Shares or has approved, endorsed or passed upon the merits of
the investment therein and that the name of the Escrow Agent has not and shall
not be used in any manner in connection with the offer or sale of the Shares
other than to state that the Escrow Agent has agreed to serve as escrow agent
for the limited purposes set forth herein.
(6) All of the representations and warranties of Company
contained herein are true and complete as of the date hereof and will be true
and complete at the time of any deposit to or disbursement from the Escrow
Funds.
b. Agent makes the following representations and warranties to
Escrow Agent:
(1) Agent is a corporation duly organized, validly existing, and
in good standing under the laws of the State of New York, and has full power and
authority to execute and deliver this Escrow Agreement and to perform its
obligations hereunder;
(2) This Escrow Agreement has been duly approved by all
necessary corporate action of Agent, has been executed by duly authorized
officers of Agent, and constitutes a valid and binding agreement of Agent,
enforceable in accordance with its terms.
(3) The execution, delivery, and performance by Agent of this
Escrow Agreement will not violate, conflict with, or cause a default under the
articles of incorporation or bylaws of Agent, any applicable law, regulation or
license applicable to the Agent, any court order or administrative ruling or
decree to which Agent is a party or any of its property is subject, or any
agreement, contract, indenture, or other binding arrangement to which Agent is a
party or any of its property is subject. The execution, delivery and performance
of this Agreement is consistent with and accurately described in the Offering
Document, and the allocation of interest and other earnings to Subscribers, as
set forth in Section 4 hereof, has been properly described therein.
(4) The deposit with Escrow Agent by Agent of Cash Investment
Instruments pursuant to Section 3 hereof shall be deemed a representation and
warranty by Agent that such Cash Investment Instrument represents a bona fide
sale to the Subscriber described therein of the amount of Shares set forth
therein, subject to and in accordance with the terms of the Offering Document.
(5) Agent hereby acknowledges that the status of Escrow Agent is
that of agent only for the limited purposes set forth herein, and hereby
represents and covenants that no representation or implication shall be made
that the Escrow Agent has investigated the desirability or advisability of
investment in the Shares or has approved, endorsed or passed upon the merits of
the investment therein and that the name of the Escrow Agent has not and shall
not
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be used in any manner in connection with the offer or sale of the Shares other
than to state that the Escrow Agent has agreed to serve as escrow agent for the
limited purposes set forth herein.
(6) All of the representations and warranties of Agent contained
herein are true and complete as of the date hereof and will be true and complete
at the time of any deposit to or disbursement from the Escrow Funds.
12. Consent to Jurisdiction and Venue. In the event that any party
hereto commences a lawsuit or other proceeding relating to or arising from this
Escrow Agreement, the parties hereto agree that the United States District Court
for the Western District of North Carolina shall have the sole and exclusive
jurisdiction over any such proceeding. If all such courts lack federal subject
matter jurisdiction, the parties agree that the Superior Court Division of the
General Court of Justice of Mecklenburg County, North Carolina shall have sole
and exclusive jurisdiction. Any of these courts shall be proper venue for any
such lawsuit or judicial proceeding and the parties hereto waive any objection
to such venue. The parties hereto consent to and agree to submit to the
jurisdiction of any of the courts specified herein and agree to accept service
or process to vest personal jurisdiction over them in any of these courts.
13. Notice. All notices and other communications hereunder shall be in
writing and shall be deemed to have been validly served, given or delivered five
(5) days after deposit in the United States mails, by certified mail with return
receipt requested and postage prepaid, when delivered personally, one (1) day
after delivery to any overnight courier, or when transmitted by facsimile
transmission facilities (with a copy mailed or otherwise delivered as provided
in this section 13), and addressed to the party to be notified as follows:
If to Agent at:
Xxxxx Xxxxxx Associates, Inc.
000 Xxxxxxx Xxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx
Facsimile Number: (000) 000-0000
If to Company at:
Apple Residential Income Trust
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xx. 00000
Attention: Xxxxx X. Xxxxxx
Facsimile Number: (000) 000-0000
If to the Escrow
Agent at:
First Union National Bank of
North Carolina, as Escrow Agent
Corporate Trust Department
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000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
ATTENTION: Xxxxx Xxxxxxxx
Facsimile Number: (000) 000-0000
or to such other address as each party may designate for itself by like notice.
14. Amendment or Waiver. This Escrow Agreement may be changed, waived,
discharged or terminated only by a writing signed by Agent, Company and Escrow
Agent. No delay or omission by any party in exercising any right with respect
hereto shall operate as a waiver. A waiver on any one occasion shall not be
construed as a bar to, or waiver of, any right or remedy on any future occasion.
15. Severability. To the extent any provision of this Escrow Agreement
is prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Escrow Agreement.
16. Governing Law. This Escrow Agreement shall be construed and
interpreted in accordance with the internal laws of the State of Virginia
without giving effect to the conflict of laws principles thereof.
17. Entire Agreement. This Escrow Agreement constitutes the entire
agreement between the parties relating to the acceptance, collection, holding,
investment and disbursement of the Escrow Funds and sets forth in their entirety
the obligations and duties of the Escrow Agent with respect to the Escrow Funds.
18. Binding Effect. All of the terms of this Escrow Agreement, as
amended from time to time, shall be binding upon, inure to the benefit of and be
enforceable by the respective successors and assigns of Agent, Company and
Escrow Agent.
19. Execution in Counterparts. This Escrow Agreement may be executed
in two or more counterparts, which when so executed shall constitute one and the
same agreement.
20. Termination. Upon the first to occur of notice of termination by
Company or deposit of all amounts in the Escrow Funds into court pursuant to
Section 5 hereof, this Escrow Agreement shall terminate and Escrow Agent shall
have no further obligation or liability whatsoever with respect to this Escrow
Agreement or the Escrow Funds.
21. Acts of the Escrow Agent. The Escrow Agent and any stockholder,
director, officer or employee of the Escrow Agent may buy, sell, and deal in any
of the securities of the Company and become pecuniarily interested in any
transaction in which the Company may be interested, and contract and lend money
to the Company and otherwise act as fully and freely
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as though it were not Escrow Agent under this Agreement. Nothing herein shall
preclude the Escrow Agent from acting in any other capacity for the Company or
for any other entity.
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed under seal as of the date first above written.
Apple Residential Income Trust, Inc.
/s/ Xxxxx X. Xxxxxx
By: ______________________________
President
Title: ______________________________
Xxxxx Xxxxxx Associates, Inc.
/s/ Xxxxxxx X. Xxxxxxxxx
By: ______________________________
Senior Vice President
Title: ______________________________
FIRST UNION NATIONAL BANK OF NORTH CAROLINA,
as Escrow Agent
/s/ Xxxxx X. Xxxxxxxx
By: ______________________________
Assistant Vice President
Title: ______________________________
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Exhibit A
Fees Payable to Escrow Agent
Annual Acceptance Fee (charged once a year) $3,000
Annual Administration Fee* $3,000
*In addition 20 Basis Points on funds invested.
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