FORM OF SUBSCRIPTION ESCROW AGREEMENT
FORM
OF SUBSCRIPTION ESCROW AGREEMENT
THIS SUBSCRIPTION ESCROW AGREEMENT
(this “Escrow
Agreement”), dated as
of ,
2010, is entered into by and among Realty Capital Securities, LLC (the “Dealer Manager”), American
Realty Capital New York Recovery REIT, Inc. (the “Company”) and Xxxxx Fargo
Bank, National Association, as Escrow Agent (the “Escrow Agent”).
WHEREAS, the Company intends
to raise cash funds from investors (the “Investors”) pursuant to a
public offering (the “Offering”) of not less than
$2,000,000 (the “Minimum
Amount”) nor more than $1,500,000,000 of shares of common stock, par
value $0.01 of the Company (the “Securities”) pursuant to the
registration statement on Form S-11 of the Company (No. 333-163069) (the “Offering Document”), as
amended, a copy of which is attached as Exhibit A hereto.
WHEREAS, the Company desires
to establish an escrow account with the Escrow Agent for funds contributed by
the Investors with the Escrow Agent, to be held for the benefit of the Investors
and the Company until such time as (i) subscriptions for the Minimum Amount of
the Securities, have been deposited into escrow or otherwise in accordance with
the terms of this Escrow Agreement, (ii) in the case of subscriptions received
from residents of Pennsylvania (“Pennsylvania Investors”) and
residents of Massachusetts (“Massachusetts Investors”),
aggregate subscriptions from all Investors resulting in a total minimum capital
raised of $50,000,000 (the “Pennsylvania and Massachusetts
Minimum Amount”) and deposited into escrow or otherwise provided in
accordance with the terms of this Escrow Agreement and (iii) in the case of
subscriptions received from residents of Tennessee (“Tennessee Investors”)
aggregate subscriptions from all Investors resulting in a total minimum capital
raised of $10,000,000 (the “Tennessee Minimum Amount”)
and deposited into escrow or otherwise provided in accordance with the terms of
this Escrow Agreement.
WHEREAS, the Escrow Agent is
willing to accept appointment as Escrow Agent only for the expressed duties
outlined herein.
NOW, THEREFORE, in
consideration of the premises set forth above and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
1.
Proceeds to be Escrowed.
On or before the first date of the Offering, the Company shall establish
an escrow account with the Escrow Agent to be invested in accordance with
Section 9 hereof entitled “ESCROW ACCOUNT FOR THE BENEFIT OF SUBSCRIBERS FOR
COMMON STOCK OF AMERICAN REALTY CAPITAL NEW YORK RECOVERY REIT, INC.” (the
“Escrow
Account”). All funds received from Investors in payment for
the Securities (“Investor
Funds”) will be delivered to the Escrow Agent within one (1) business day
following the day upon which such Investor Funds are received by the Company or
its agents, and shall, upon receipt by the Escrow Agent, be retained in escrow
by the Escrow Agent and invested as stated herein. During the term of this
Escrow Agreement, the Company or its agents shall cause all checks received by
and made payable to it in payment for the Securities to be endorsed in favor of
the Escrow Agent and delivered to the Escrow Agent for deposit in the Escrow
Account.
Proceeds received from Pennsylvania
Investors and Massachusetts Investors shall be accounted for separately in a
subaccount entitled “Escrow Account for the Benefit of Pennsylvania and
Massachusetts Subscribers for American Realty Capital New York Recovery REIT,
Inc.” (the “Pennsylvania and
Massachusetts Escrow Account”), until such Pennsylvania and Massachusetts
Escrow Account has closed pursuant to Section 4 hereof. The Company
shall, and shall cause its agents to, cooperate with the Escrow Agent in
separately accounting for subscription proceeds from Pennsylvania Investors and
Massachusetts Investors in the Pennsylvania and Massachusetts Escrow Account,
and the Escrow Agent shall be entitled to rely upon information provided by the
Company or its agents in this regard.
Proceeds received from Tennessee
Investors shall be accounted for separately in a subaccount entitled “Escrow
Account for the Benefit of Tennessee Subscribers for American Realty Capital New
York Recovery REIT, Inc.” (the “Tennessee Escrow Account,”
and together with the Escrow Account and Pennsylvania and Massachusetts Escrow
Account, the “ARC NYRR Escrow
Accounts”), until such Tennessee Escrow Account has closed pursuant to
Section 5 hereof. The Company shall, and shall cause its agents to,
cooperate with the Escrow Agent in separately accounting for subscription
proceeds from Tennessee Investors in the Tennessee Escrow Account, and the
Escrow Agent shall be entitled to rely upon information provided by the Company
or its agents in this regard.
The Escrow Agent shall have no duty to
make any disbursement, investment or other use of Investor Funds until and
unless it has good and collected funds. In the event that any checks
deposited in the ARC NYRR Escrow Accounts are returned or prove uncollectible
after the funds represented thereby have been released by the Escrow Agent, then
the Company shall promptly reimburse the Escrow Agent for any and all costs
incurred for such, upon request, and the Escrow Agent shall deliver the returned
checks to the Company. The Escrow Agent shall be under no duty or
responsibility to enforce collection of any check delivered to it
hereunder.
The Escrow Agent reserves the right to deny, suspend or terminate participation
by an Investor to the extent the Escrow Agent deems it advisable or necessary to
comply with applicable laws or to eliminate practices that are not consistent
with the purposes of the Offering.
2.
Subscribers. Persons
subscribing to purchase the Securities will be instructed by Realty Capital
Securities, LLC (the “Dealer
Manager”) or any soliciting dealers to remit the purchase price in the
form of checks (hereinafter “instruments of payment”) payable to the order of,
or funds wired in favor of, “XXXXX FARGO BANK, NA, ESCROW AGENT FOR AMERICAN
REALTY CAPITAL NEW YORK RECOVERY REIT, INC.” Any checks received made
payable to a party other than the Escrow Agent shall be returned to the
soliciting dealer who submitted the check. By 12:00 p.m. (noon) the
next business day after receipt of instruments of payment from the Offering, the
Escrow Agent shall be furnished with a list of the Investors who have paid for
the Securities showing the name, address, tax identification number, amount of
Securities subscribed for, the amount paid and whether such Investors are
Pennsylvania Investors, Massachusetts Investors or Tennessee
Investors. The information comprising the identity of Investors shall
be provided to the Escrow Agent in the format set forth in the “List of
Investors” attached hereto as Exhibit B. The Escrow Agent shall be
entitled to conclusively rely upon the list of Investors in determining whether
Investors are Pennsylvania Investors, Massachusetts Investors or Tennessee
Investors, and shall have no duty to independently determine or verify the
same.
All Investor Funds deposited in the ARC
NYRR Escrow Accounts shall not be subject to any liens or charges by the Company
or the Escrow Agent, or judgments or creditors' claims against the Company,
until and unless released to the Company as hereinafter provided. The
Company understands and agrees that the Company shall not be entitled to any
Investor Funds on deposit in the ARC NYRR Escrow Accounts and no such funds
shall become the property of the Company, or any other entity except as released
to the Company pursuant to Section 3, Section 4 for Pennsylvania Investors or
Massachusetts Investors or Section 5 for Tennessee Investors. The Escrow Agent
will not use the information provided to it by the Company for any purpose other
than to fulfill its obligations as Escrow Agent. The Company and the
Escrow Agent will treat all Investor information as confidential. The
Escrow Agent shall not be required to accept any Investor Funds which are not
accompanied by the information on the List of Investors.
3.
Disbursement of
Funds. Once the Escrow Agent is in receipt of good and
collected Investor Funds totaling at least the Minimum Amount from Investors
(excluding funds from Pennsylvania Investors, Massachusetts Investors and
Tennessee Investors), the Escrow Agent shall notify the Company of same in
writing. Additionally, at the end of the third business day following the
Termination Date (as defined in Section 6), the Escrow Agent shall notify the
Company of the amount of the Investor Funds received. If the Minimum
Amount has been obtained on or before the Termination Date, the Escrow Agent
shall promptly notify the Company and, upon receiving an acknowledgement of such
notice written instructions from the Company’s General Counsel or Chief
Financial Officer, the Escrow Agent shall disburse to the Company, by check or
wire transfer, the funds in the Escrow Account representing the gross purchase
price of the Securities. The Escrow Agent agrees that funds in the
Escrow Account shall not be released to the Company until and unless the Escrow
Agent receives written instructions to release the funds from the Company’s
General Counsel or Chief Financial Officer.
If the Minimum Amount has not been
obtained prior to the Termination Date, the Escrow Agent shall, within a
reasonable time following the Termination Date, but in no event more than thirty
(30) days after the Termination Date, refund to each Investor by check funds
deposited in the Escrow Account, or shall return the instruments of payment
delivered to Escrow Agent if such instruments have not been processed for
collection prior to such time, directly to each Investor at the address provided
in the list of Investors. Included in the remittance shall be a proportionate
share of the income earned in the account allocable to each Investor's
investment in accordance with the terms and conditions specified herein, except
that in the case of subscribers who have not provided an executed Form W-9 or
substitute Form W-9 (or the applicable substitute Form W-8 for foreign
investors), the Escrow Agent shall withhold the applicable percentage of the
earnings attributable to those Investors in accordance with IRS regulations.
Notwithstanding the foregoing, the Escrow Agent shall not be required to remit
any payments until funds represented by such payments have been collected by
Escrow Agent.
In the event the Escrow Agent receives
written notice from the Company that the Company intends to reject an Investor’s
subscription, the Escrow Agent shall pay to the applicable Investor(s), within a
reasonable time not to exceed ten (10) business days after receiving notice of
the rejection, by first class United States Mail at the address appearing on the
List of Investors, or at such other address as shall be furnished to the Escrow
Agent by the Investor in writing, all collected sums paid by the Investor for
Securities and received by the Escrow Agent, together with the interest earned
on such Investor Funds.
4.
Disbursement of Proceeds for
Pennsylvania Investors and Massachusetts
Investors. Notwithstanding the foregoing, proceeds from
Pennsylvania Investors and Massachusetts Investors will not count towards
meeting the Minimum Amount for purposes of Section 3. Proceeds
received from Pennsylvania Investors and Massachusetts Investors will not be
released from the Pennsylvania and Massachusetts Escrow Account until the
Pennsylvania and Massachusetts Minimum Amount is obtained. If the
Pennsylvania and Massachusetts Minimum Amount is obtained at any time prior to
the Termination Date, the Escrow Agent shall promptly notify the Company and,
upon receiving acknowledgement of such notice and written instructions from the
Company’s General Counsel or Chief Financial Officer, the Escrow Agent shall
disburse to the Company, by check or wire transfer, the funds in the
Pennsylvania and Massachusetts Escrow Account representing the gross purchase
price of the Securities. The Escrow Agent agrees that funds in
the Pennsylvania and Massachusetts Escrow Account shall not be released to the
Company until and unless the Escrow Agent receives written instructions to
release the funds from the Company’s General Counsel or Chief Financial
Officer.
If the
Pennsylvania and Massachusetts Minimum Amount has not been obtained prior to the
Termination Date, the Escrow Agent shall, within a reasonable time following the
Termination Date, but in no event more than thirty (30) days after the
Termination Date, refund to each Pennsylvania Investor and Massachusetts
Investor by check funds deposited in the Pennsylvania and Massachusetts Escrow
Account, or shall return the instruments of payment delivered to Escrow Agent if
such instruments have not been processed for collection prior to such time,
directly to each Pennsylvania Investor or Massachusetts Investor at the address
provided in the list of Investors. Included in the remittance shall be a
proportionate share of the income earned in the account allocable to each
Pennsylvania Investor's or and Massachusetts Investor’s investment in accordance
with the terms and conditions specified herein, except that in the case of
subscribers who have not provided an executed Form W-9 or substitute Form W-9,
the Escrow Agent shall withhold the applicable percentage of the earnings
attributable to those Investors in accordance with IRS regulations.
Notwithstanding the foregoing, the Escrow Agent shall not be required to remit
any payments until funds represented by such payments have been collected by
Escrow Agent.
If the Escrow Agent is not in receipt
of evidence of subscriptions accepted on or before the close of business on such
date that is 120 days after commencement of the Offering (the Company will
notify the Escrow Agent of the commencement date of the Offering) (the “Initial Escrow Period”), and
instruments of payment dated not later than that date, for the purchase of
Securities providing for total purchase proceeds from all nonaffiliated sources
that equal or exceed the Pennsylvania and Massachusetts Minimum Amount, the
Escrow Agent shall promptly notify the Company. Thereafter, the Company or its
agents shall send to each Pennsylvania Investor by certified mail within ten
(10) calendar days after the end of the Initial Escrow Period a
notification substantially in the form of Exhibit F. If,
pursuant to such notification, a Pennsylvania Investor requests the return of
his or her subscription funds within ten (10) calendar days after receipt of the
notification (the “Request
Period”), the Escrow Agent shall promptly refund directly to each
Pennsylvania Investor the collected funds deposited in the Pennsylvania and
Massachusetts Escrow Account on behalf of such Pennsylvania Investor or shall
return the instruments of payment delivered, but not yet processed for
collection prior to such time, to the address provided by the Dealer Manager or
the Company or their respective agents to the Escrow Agent, which the Escrow
Agent shall be entitled to rely upon, together with interest income (which
interest shall be paid within five business days after the first business day of
the succeeding month) in the amounts calculated pursuant to Section 9.
Notwithstanding the above, if the Escrow Agent has not received an executed Form
W-9 or substitute Form W-9 for such Pennsylvania Investor, the Escrow Agent
shall thereupon remit an amount to such Pennsylvania Investor in accordance with
the provisions hereof, withholding the applicable percentage for backup
withholding required by the Internal Revenue Code, as then in effect, from any
interest income earned on subscription proceeds (determined in accordance with
Section 9) attributable to such Pennsylvania Investor. However, the Escrow Agent
shall not be required to remit such payments until the Escrow Agent has
collected funds represented by such payments.
The
subscription funds of Pennsylvania Investors who do not request the return of
their subscription funds within the Request Period shall remain in the
Pennsylvania and Massachusetts Escrow Account for successive 120-day escrow
periods (a “Successive Escrow
Period”), each commencing automatically upon the termination of the prior
Successive Escrow Period, and the Company and Escrow Agent shall follow the
notification and payment procedure set forth above with respect to the Initial
Escrow Period for each Successive Escrow Period until the occurrence of the
earliest of (i) the Termination Date, (ii) the receipt and acceptance
by the Company of subscriptions for the purchase of Securities with total
purchase proceeds that equal or exceed the Pennsylvania and Massachusetts
Minimum Amount and the disbursement of the Pennsylvania and Massachusetts Escrow
Account on the terms specified herein, or (iii) all funds held in the
Pennsylvania and Massachusetts Escrow Account having been returned to the
Pennsylvania Investors and Massachusetts Investors in accordance with the
provisions hereof.
5.
Disbursement of Proceeds for
Tennessee Investors. Notwithstanding the foregoing, proceeds
from Tennessee Investors will not count towards meeting the Minimum Amount for
purposes of Section 3. Proceeds received from Tennessee Investors
will not be released from the Tennessee Escrow Account until the Tennessee
Minimum Amount is obtained. If the Tennessee Minimum Amount is
obtained at any time prior to the Termination Date, the Escrow Agent shall
promptly notify the Company and, upon receiving acknowledgement of such notice
and written instructions from the Company’s General Counsel of Chief Financial
Officer, the Escrow Agent shall disburse to the Company, by check or wire
transfer, the funds in the Tennessee Escrow Account representing the gross
purchase price of the Securities. The Escrow Agent agrees that funds
in the Tennessee Escrow Account shall not be released to the Company until and
unless the Escrow Agent receives written instructions to release the funds from
the Company’s General Counsel or Chief Financial Officer.
If the
Tennessee Minimum Amount has not been obtained prior to the Termination Date,
the Escrow Agent shall, within a reasonable time following the Termination Date,
but in no event more than thirty (30) days after the Termination Date, refund to
each Tennessee Investor by check funds deposited in the Tennessee Escrow
Account, or shall return the instruments of payment delivered to Escrow Agent if
such instruments have not been processed for collection prior to such time,
directly to each Tennessee Investor at the address provided in the list of
Investors. Included in the remittance shall be a proportionate share
of the income earned in the account allocable to each Tennessee Investor’s
investment in accordance with the terms and conditions specified herein, except
that in the case of subscribers who have not provided an executed Form W-9 or
substitute Form W-9, the Escrow Agent shall withhold the applicable percentage
of the earnings attributable to those Investors in accordance with IRS
regulations. Notwithstanding the foregoing, the Escrow Agent shall not be
required to remit any payments until funds represented by such payments have
been collected by Escrow Agent.
6.
Term of Escrow. The
"Termination Date" shall be the earlier of (i) the close of business on the one
year anniversary of the date of this Escrow Agreement; (ii) all funds held in
the ARC NYRR Escrow Accounts are distributed to the Company or to Investors
pursuant to Section 3, Section 4 for Pennsylvania Investors and Massachusetts
Investors and Section 5 for Tennessee Investors, and the Company has informed
the Escrow Agent in writing to close each of the ARC NYRR Escrow Accounts; (iii)
the date the Escrow Agent receives written notice from the Company that it is
abandoning the sale of the Securities; or (iv) the date the Escrow Agent
receives notice from the Securities and Exchange Commission or any other federal
or state regulatory authority that a stop or similar order has been issued with
respect to the Offering Document and has remained in effect for at least twenty
(20) days. After the Termination Date the Company shall not deposit,
and the Escrow Agent shall not accept, any additional amounts representing
payments by prospective Investors.
7.
Duty
and Liability of the Escrow Agent. The sole duty of the Escrow Agent
shall be to receive Investor Funds and hold them subject to release, in
accordance herewith, and the Escrow Agent shall be under no duty to determine
whether the Company or the Dealer Manager is complying with requirements of this
Escrow Agreement, the Offering or applicable securities or other laws in
tendering the Investor Funds to the Escrow Agent. No other agreement entered
into between the parties, or any of them, shall be considered as adopted or
binding, in whole or in part, upon the Escrow Agent notwithstanding that any
such other agreement may be referred to herein or deposited with the Escrow
Agent or the Escrow Agent may have knowledge thereof, including specifically but
without limitation any Offering Documents, and the Escrow Agent's rights and
responsibilities shall be governed solely by this Escrow
Agreement. The Escrow Agent shall not be responsible for or be
required to enforce any of the terms or conditions of any Offering Document or
other agreement between the Company and any other party. The Escrow
Agent may conclusively rely upon and shall be protected in acting upon any
statement, certificate, notice, request, consent, order or other document
believed by it to be genuine and to have been signed or presented by the proper
party or parties. The Escrow Agent shall have no duty or liability to verify any
such statement, certificate, notice, request, consent, order or other document,
and its sole responsibility shall be to act only as expressly set forth in this
Escrow Agreement. Concurrent with the execution of this Escrow Agreement, the
Company shall deliver to the Escrow Agent an authorized signers form in the form
of Exhibit C to this Escrow Agreement. The Escrow Agent shall be
under no obligation to institute or defend any action, suit or proceeding in
connection with this Escrow Agreement unless first indemnified to its
satisfaction. The Escrow Agent may consult counsel of its own choice
with respect to any question arising under this Escrow Agreement and the Escrow
Agent shall not be liable for any action taken or omitted in good faith upon
advice of such counsel. 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 loss. The Escrow Agent is acting
solely as escrow agent hereunder and owes no duties, covenants or obligations,
fiduciary or otherwise, to any other person by reason of this Escrow Agreement,
except as otherwise stated herein, and no implied duties, covenants or
obligations, fiduciary or otherwise, shall be read into this Escrow Agreement
against the Escrow Agent. In the event of any disagreement between any of
the parties to this Escrow Agreement, or between any of them and any other
person, including any Investor, resulting in adverse claims or demands being
made in connection with the matters covered by this Escrow Agreement, or in the
event that the Escrow Agent is in doubt as to what action it should take
hereunder, the Escrow Agent may, at its option, refuse to comply with any claims
or demands on it, or refuse to take any other action hereunder, so long as such
disagreement continues or such doubt exists, and in any such event, the Escrow
Agent shall not be or become liable in any way or to any person for its failure
or refusal to act, and the Escrow Agent shall be entitled to continue so to
refrain from acting until (i) the rights of all interested parties shall have
been fully and finally adjudicated by a court of competent jurisdiction, or (ii)
all differences shall have been adjudged and all doubt resolved by agreement
among all of the interested persons, and the Escrow Agent shall have been
notified thereof in writing signed by all such persons. Notwithstanding the
foregoing, the Escrow Agent may in its discretion obey the order, judgment,
decree or levy of any court, whether with or without jurisdiction and the Escrow
Agent is hereby authorized in its sole discretion to comply with and obey any
such orders, judgments, decrees or levies. In the event that any
controversy should arise with respect to this Escrow Agreement the Escrow Agent
shall have the right, at its option, to institute an interpleader action in any
court of competent jurisdiction to determine the rights of the
parties. IN NO EVENT SHALL THE ESCROW AGENT BE LIABLE, DIRECTLY OR
INDIRECTLY, FOR ANY SPECIAL, INDIRECT OR CONSEQUENTIAL LOSSES OR DAMAGES OF ANY
KIND WHATSOEVER (INCLUDING WITHOUT LIMITATION LOST PROFITS), EVEN IF THE ESCROW
AGENT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES AND
REGARDLESS OF THE FORM OF ACTION. The parties agree that the Escrow
Agent has no role in the preparation of the Offering Documents and makes no
representations or warranties with respect to the information contained therein
or omitted therefrom. The Escrow Agent shall have no obligation, duty
or liability with respect to compliance with any federal or state securities,
disclosure or tax laws concerning the Offering Documents or the issuance,
offering or sale of the Securities. The Escrow Agent shall have no
duty or obligation to monitor the application and use of the Investor Funds once
transferred to the Company, that being the sole obligation and responsibility of
the Company.
8.
Escrow Agent's Fee. The Escrow
Agent shall be entitled to compensation for its services as stated in the fee
schedule attached hereto as Exhibit D, which compensation shall be paid by the
Company. The fee agreed upon for the services rendered hereunder is intended as
full compensation for the Escrow Agent's services as contemplated by this Escrow
Agreement; provided, however, that in the event that the conditions for the
disbursement of funds under this Escrow Agreement are not fulfilled, or the
Escrow Agent renders any material service not contemplated in this Escrow
Agreement, or there is any assignment of interest in the subject matter of this
Escrow Agreement, or any material modification hereof, or if any material
controversy arises hereunder, or the Escrow Agent is made a party to any
litigation pertaining to this Escrow Agreement, or the subject matter hereof,
then the Escrow Agent shall be reasonably compensated for such extraordinary
services and reimbursed for all costs and expenses, including reasonable
attorney's fees, occasioned by any delay, controversy, litigation or event, and
the same shall be recoverable from the Company. The Company’s
obligations under this Section 8 shall survive the resignation or removal of the
Escrow Agent and the assignment or termination of this Escrow
Agreement.
9.
Investment of Proceeds. The
Investor Funds shall be deposited in the ARC NYRR Escrow Accounts in accordance
with Section 3, Section 4 for Pennsylvania Investors and Massachusetts
Investors, and Section 5 for Tennessee Investors. The Escrow Agent is
hereby directed to invest all funds received under this Escrow Agreement,
including principal and interest in, a Xxxxx Fargo Bank Money Market Deposit
Account, as directed in writing in the form of Exhibit E to this Escrow
Agreement. The Escrow Agent shall invest the Investor Funds in
alternative investments in accordance with written instructions as may from time
to time be provided to the Escrow Agent and signed by the Company. In
the absence of written investment instructions from the Company to the contrary,
the Escrow Agent is hereby directed to invest the Investor Funds in the Xxxxx
Fargo Bank Money Market Deposit Account. Notwithstanding the
foregoing, Investor Funds shall not be invested in anything other than “Short
Term Investments” in compliance with Rule 15c2-4 of the Securities Exchange Act
of 1934, as amended. The following are not permissible investments:
(a) money market mutual funds, (b) corporate debt or equity securities, (c)
repurchase agreements, (d) banker’s acceptance, (e) commercial paper, and (f)
municipal securities. Any interest received by the Escrow Agent with
respect to the Investor Funds, including reinvested interest shall become part
of the Investor Funds, and shall be disbursed pursuant to Section 3, Section 4
for Pennsylvania Investors and Massachusetts Investors or Section 5 for
Tennessee Investors.
The Escrow Agent shall be entitled to
sell or redeem any such investments as necessary to make any payments or
distributions required under this Escrow Agreement. The Escrow Agent
shall have no responsibility or liability for any loss which may result from any
investment made pursuant to this Escrow Agreement, or for any loss resulting
from the sale of such investment. The parties acknowledge that the
Escrow Agent is not providing investment supervision, recommendations, or
advice.
The
Company on the date of this Escrow Agreement shall provide the Escrow Agent with
certified tax identification numbers by furnishing appropriate IRS forms W-9 or
W-8 (or substitute forms W-9 or W-8) and other forms and documents that the
Escrow Agent may reasonably request. The Company understands that if
such tax reporting documentation is not so certified to the Escrow Agent, the
Escrow Agent may be required by the Internal Revenue Code of 1986, as amended,
to withhold a portion of any interest or other income earned on the Investor
Funds pursuant to this Escrow Agreement.
The Company agrees to indemnify and
hold the Escrow Agent harmless from and against any taxes, additions for late
payment, interest, penalties and other expenses that may be assessed against the
Escrow Agent on or with respect to any payment or other activities under this
Escrow Agreement unless any such tax, addition for late payment, interest,
penalties and other expenses shall be determined by a court of competent
jurisdiction to have been caused by the Escrow Agent's gross negligence or
willful misconduct. The terms of this Section shall survive the
termination of this Escrow Agreement and the resignation or removal of the
Escrow Agent.
10. Notices. All
notices, requests, demands, and other communications under this Escrow Agreement
shall be in writing and shall be deemed to have been duly given (a) on the date
of service if served personally on the party to whom notice is to be given, (b)
on the day of transmission if sent by facsimile/email transmission to the
facsimile number/email address given below, and telephonic confirmation of
receipt is obtained promptly after completion of transmission, (c) on the day
after delivery to Federal Express or similar overnight courier or the Express
Mail service maintained by the United States Postal Service, or (d) on the fifth
day after mailing, if mailed to the party to whom notice is to be given, by
first class mail, registered or certified, postage prepaid, and properly
addressed, return receipt requested, to the party as follows:
If to the
Company:
000 Xxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
Attention: Xxxxxxx
Xxxx, Executive Vice President and Secretary
Attention: Xxxxx
X. Block, Executive Vice President and Chief Financial Officer
with a
copy to:
Proskauer
Rose LLP
0000
Xxxxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
Attention:
Xxxxx X. Xxxx, Esq.
Attention: Xxxxx
X. Gerkis, Esq.
If to the
Dealer Manager:
Realty
Capital Securities, LLC
Three
Xxxxxx Place
Suite
3300
Xxxxxx,
XX 00000
Attention: Xxxxxxxx
Xxxxxxxx, Chief Executive Officer
with a
copy to:
Proskauer
Rose LLP
0000
Xxxxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
Attention:
Xxxxx X. Xxxx, Esq.
Attention: Xxxxx
X. Gerkis, Esq.
and:
American
Realty Capital New York Recovery REIT, Inc.
000 Xxxx
Xxxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000
Attention: Xxxxxxx
Xxxx, Executive Vice President and Secretary
Attention: Xxxxx
X. Block, Executive Vice President and Chief Financial Officer
If to
Escrow Agent:
Xxxxx
Fargo Bank, National Association
000 Xxxx
Xxxxxx, Xxxxx 000
Xxxxx
Xxxxx, Xxxxx 00000-0000
Attention: [______________]
Any party
may change its address for purposes of this Section by giving the other party
written notice of the new address in the manner set forth above.
11. Indemnification of Escrow Agent.
The Company and the Dealer Manager hereby jointly and severally
indemnify, defend and hold harmless the Escrow Agent from and against, any and
all loss, liability, cost, damage and expense, including, without limitation,
reasonable counsel fees and expenses, which the Escrow Agent may suffer or incur
by reason of any action, claim or proceeding brought against the Escrow Agent
arising out of or relating in any way to this Escrow Agreement or any
transaction to which this Escrow Agreement relates unless such loss, liability,
cost, damage or expense is finally determined by a court of competent
jurisdiction to have been primarily caused by the willful misconduct of the
Escrow Agent. The terms of this Section shall survive the termination
of this Escrow Agreement and the resignation or removal of the Escrow
Agent.
12. Successors and Assigns. Except
as otherwise provided in this Escrow Agreement, no party hereto shall assign
this Escrow Agreement or any rights or obligations hereunder without the prior
written consent of the other parties hereto and any such attempted assignment
without such prior written consent shall be void and of no force and effect.
This Escrow Agreement shall inure to the benefit of and shall be binding upon
the successors and permitted assigns of the parties hereto. Any
corporation or association into which the Escrow Agent may be converted or
merged, or with which it may be consolidated, or to which it may sell or
transfer all or substantially all of its corporate trust business and assets as
a whole or substantially as a whole, or any corporation or association resulting
from any such conversion, sale, merger, consolidation or transfer to which the
Escrow Agent is a party, shall be and become the successor Escrow Agent under
this Escrow Agreement and shall have and succeed to the rights, powers, duties,
immunities and privileges as its predecessor, without the execution or filing of
any instrument or paper or the performance any further act.
13. Governing Law; Jurisdiction.
This Escrow Agreement shall be construed, performed, and enforced in
accordance with, and governed by, the internal laws of the State of New York,
without giving effect to the principles of conflicts of laws
thereof.
14. Severability. In the event
that any part of this Escrow Agreement is declared by any court or other
judicial or administrative body to be null, void, or unenforceable, said
provision shall survive to the extent it is not so declared, and all of the
other provisions of this Escrow Agreement shall remain in full force and
effect.
15. Amendments; Waivers. This
Escrow Agreement may be amended or modified, and any of the terms, covenants,
representations, warranties, or conditions hereof may be waived, only by a
written instrument executed by the parties hereto, or in the case of a waiver,
by the party waiving compliance. Any waiver by any party of any condition, or of
the breach of any provision, term, covenant, representation, or warranty
contained in this Escrow Agreement, in any one or more instances, shall not be
deemed to be nor construed as further or continuing waiver of any such
condition, or of the breach of any other provision, term, covenant,
representation, or warranty of this Escrow Agreement. The Company and
the Dealer Manager agree that any requested waiver, modification or amendment of
this Escrow Agreement shall be consistent with the terms of the
Offering.
16. Entire Agreement. This Escrow
Agreement contains the entire understanding among the parties hereto with
respect to the escrow contemplated hereby and supersedes and replaces all prior
and contemporaneous agreements and understandings, oral or written, with regard
to such escrow.
17. Section Headings. The section
headings in this Escrow Agreement are for reference purposes only and shall not
affect the meaning or interpretation of this Escrow Agreement.
18. Counterparts. This Escrow
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which shall constitute the same instrument.
19. Resignation. The Escrow Agent
may resign upon 30 days advance written notice to the parties hereto. If a
successor escrow agent is not appointed within the 30-day period following such
notice, the Escrow Agent may petition any court of competent jurisdiction to
name a successor escrow agent or interplead the Investor Funds with such court,
whereupon the Escrow Agent’s duties hereunder shall terminate.
20. References to Escrow
Agent. Other than the Offering Document (including the
subscription agreement and exhibits thereto) and any amendments or supplements
thereto, no printed or other matter in any language (including, without
limitation, notices, reports and promotional material) which mentions the Escrow
Agent’s name or the rights, powers, or duties of the Escrow Agent shall be
issued by the Company or the Dealer Manager, or on the Company’s or the Dealer
Manager’s behalf, unless the Escrow Agent shall first have given its specific
written consent thereto. Notwithstanding the foregoing, any amendment
or supplement to the Offering Document (including the subscription agreement and
exhibits thereto) that revises, alters, modifies, changes or adds to the
description of the Escrow Agent or its rights, powers or duties hereunder shall
not be issued by the Company or the Dealer Manager, or on the Company’s or
Dealer Manager’s behalf, unless the Escrow Agent has first given specific
written consent thereto.
IN WITNESS WHEREOF, the
parties hereto have caused this Escrow Agreement to be executed the date and
year first set forth above.
AMERICAN
REALTY CAPITAL
NEW YORK
RECOVERY REIT, INC.
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By:
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Name:
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Xxxxxxxx
X. Xxxxxxxx
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Title:
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Chief
Executive Officer
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REALTY
CAPITAL SECURITIES, LLC
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By:
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Name:
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Xxxxxxxx
X. Xxxxxxxx
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||
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Title:
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Chief
Executive Officer
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XXXXX
FARGO BANK, NATIONAL
ASSOCIATION,
as Escrow Agent
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By:
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Name:
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Title:
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Exhibit
A
Copy of
Offering Document
Exhibit
B
List of
Investors
Pursuant
to the Escrow Agreement
dated ,
2010, by and between American Realty Capital New York Recovery REIT, Inc., (the
“Company”), and Xxxxx
Fargo Bank, National Association (the “Escrow Agent”), the Company
hereby certifies that the following Investors have paid money for the purchase
of shares of the Company’s common stock, par value $0.01, and the money has been
deposited with the Escrow Agent:
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1.
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Name
of Subscriber
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Address
Tax
Identification Number
Amount of
Securities subscribed for
Amount of
money paid and deposited with Escrow Agent
Is
Subscriber a resident of Pennsylvania (Yes or No)?
Is
Subscriber a resident of Massachusetts (Yes or No)?
Is
Subscriber a resident of Tennessee (Yes or No)?
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2.
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Name
of Subscriber
|
Address
Tax
Identification Number
Amount of
Securities subscribed for
Amount of
money paid and deposited with Escrow Agent
Is
Subscriber a resident of Pennsylvania (Yes or No)?
Is
Subscriber a resident of Massachusetts (Yes or No)?
Is
Subscriber a resident of Tennessee (Yes or No)?
Company: _________________________________
By: ________________________
Its: ________________________
Date: ______________________
Exhibit
C
CERTIFICATE
AS TO AUTHORIZED SIGNATURES
Account
Name:
Account
Number:
The
specimen signatures shown below are the specimen signatures of the individuals
who have been designated as Authorized Representatives of American Realty Capital New York
Recovery REIT, Inc. and are authorized to initiate and approve
transactions of all types for the above-mentioned account on behalf of American Realty Capital New York
Recovery REIT, Inc.
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Name/Title
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Specimen
Signature
|
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Xxxxxxxx
X. Xxxxxxxx
Chief
Executive Officer
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_______________________________
Signature
|
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Xxxxxxx
X. Xxxxxx
President
and Treasurer
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_______________________________
Signature
|
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Xxxxxxx
Xxxxxx
Executive
Vice President and Chief Investment Officer
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_______________________________
Signature
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Xxxxx
Xxxxx
Executive
Vice President and Chief Financial Officer
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_______________________________
Signature
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Xxxxxxx
Xxxx
Executive
Vice President and Secretary
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_______________________________
Signature
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Exhibit
D
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Wells
Fargo Bank
Corporate
Trust Services
0000
Xxxx Xxxxxx, 0xx
Xxxxx
Xxx
X0000-000
Xxxxxx,
XX 00000
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[NAME]
[POSITION]
Tel: [__________]
Fax: [__________]
[EMAIL]
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[logo] |
GENERAL
SCHEDULE OF FEES
to
act as ESCROW AGENT for the
American
Realty Capital New York Recovery REIT, Inc. Subscription Escrow up to
$50,000,000
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Acceptance
Fee:
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$500
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Initial
Fees as they relate to Xxxxx Fargo Bank acting in the capacity of Escrow Agent –
includes review of the Escrow Agreement; acceptance of the Escrow appointment;
setting up of Escrow Account(s) and accounting records; and coordination of
receipt of funds for deposit to the Escrow Account(s).
Acceptance
Fee payable at time of Escrow Agreement execution.
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Escrow Agent Annual
Administration Fee:
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$5,000.00
on first offering, $3,500 on
subsequent
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Pennsylvania
and Massachusetts Sub-Accounting Administration
Fee: $750
For
ordinary administrative services by Escrow Agent – includes daily routine
account management; investment transactions; cash transaction processing
(including wire and check processing); monitoring claim notices pursuant to the
agreement; disbursement of funds in accordance with the agreement; and mailing
of trust account statements to all applicable parties. Float credit
received by the bank for receiving funds that remain uninvested are deemed part
of the Paying Agent/Escrow Agent’s compensation. These fees do not
contemplate paying interest to subscribers or providing 1099s which would be the
responsibility of ACS. If individual 1099s, interest checks, interest accrual
calculations or any individual subscriber information are required additional
fees will be charged. For rejected subscriptions or a failed
offering, the following fees will apply.
1099
Reporting $25 each
Interest
Rate Calculations and Interest Checks/Wires $ 35 each
Returned
Item Charges $35 each
The administrative fee is payable in
advance, with the first year fee due upon opening of the account. The
Annual Fee covers a full year or any part thereof, and therefore will not be
prorated or refunded in the year of early termination. These fees do
not include bank activity fees associated with Desktop Deposit
system. Fees for these services will be provided separately by our
Treasury Management Group.
Xxxxx
Fargo’s bid is based on the following assumptions:
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·
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Number
of Escrow Accounts to be established: One
(1)
|
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·
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Number
of Deposits to Escrow Account: Electronically, approximately
(10-20 per day)
|
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·
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Number
of Withdrawals from Escrow Fund: Not more than two per
week.
|
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·
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Term
of Escrow: One (1) year
|
|
·
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APPOINTMENT SUBJECT TO RECEIPT
OF REQUESTED DUE DILIGENCE INFORMATION AS PER THE USA PATRIOT
ACT
|
|
·
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THIS PROPOSAL ASSUMES THAT
BALANCES IN THE ACCOUNT WILL BE INVESTED IN MONEY MARKET
FUNDS
|
|
·
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ALL FUNDS WILL
BE RECEIVED FROM OR DISTRIBUTED TO A DOMESTIC OR AN APPROVED
FOREIGN ENTITY
|
|
·
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IF THE ACCOUNT(S) DOES NOT OPEN
WITHIN THREE (3) MONTHS OF THE DATE SHOWN BELOW, THIS PROPOSAL WILL BE
DEEMED TO BE NULL AND VOID
|
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Out-of Pocket
Expenses:
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At
Cost
|
We will
charge for out-of-pocket expenses in response to specific tasks assigned by the
client or provided for in the escrow agreement. Possible expenses
would be, but are not limited to, express mail and messenger charges, travel
expenses to attend closing or other meetings. There are no
charges for indirect out-of- pocket expenses.
This
fee schedule is based upon the assumptions listed above which pertain to the
responsibilities and risks involved in Xxxxx Fargo undertaking the role of
Escrow Agent. These assumptions are based on information provided to
us as of the date of this fee schedule. Our fee schedule is subject
to review and acceptance of the final documents. Should any of the
assumptions, duties or responsibilities change, we reserve the right to affirm,
modify or rescind our fee schedule. Extraordinary services (services other than
the ordinary administration services of Escrow Agent described above) are not
included in the annual administration fee and will be billed as incurred at the
rates in effect from time to time.
Submitted
on: ,
2010
Exhibit
E
Agency
and Custody Account Direction
For
Cash Balances
Xxxxx
Fargo Bank Money Market Deposit Accounts
Direction
to use the following Xxxxx Fargo Bank Money Market Deposit Accounts for Cash
Balances for the escrow account (the “Account”) created under the Escrow
Agreement to which this Exhibit is attached.
You are
hereby directed to deposit, as indicated below, or as we shall direct further in
writing from time to time, all cash in the Account in the following money market
deposit account of Xxxxx Fargo Bank, National Association (“Bank”):
Xxxxx
Fargo Bank Money Market Deposit Account (“MMDA”)
We
understand that amounts on deposit in the MMDA are insured, subject to the
applicable rules and regulations of the Federal Deposit Insurance Corporation
(the “FDIC”), in the basic FDIC insurance amount of $250,000 per depositor, per
insured bank. This includes principal and accrued interest up to a total of
$250,000. We understand that deposits in the MMDA are not
secured.
Xxxxx
Fargo Bank, National Association has short term debt ratings of "P-1” from
Xxxxx'x Investors Service and "A-1+" from Standard & Poor's Ratings
Services.
We
acknowledge that we have full power to direct investments in the
Account.
We
understand that we may change this direction at any time and that it shall
continue in effect until revoked or modified by us by written notice to
you.
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American
Realty Capital New York Recovery REIT, Inc.
|
||
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||
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Signature
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||
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|
||
|
Date
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Exhibit
F
[Form of
Notice to Pennsylvania Investors]
You have
tendered a subscription to purchase shares of common stock of American Realty
Capital New York Recovery REIT, Inc. (the “Company”). Your subscription is
currently being held in escrow. The guidelines of the Pennsylvania
Securities Commission do not permit the Company to accept subscriptions from
Pennsylvania residents until an aggregate of $50,000,000 of gross offering
proceeds have been received by the Company. The Pennsylvania guidelines provide
that until this minimum amount of offering proceeds is received by the Company,
every 120 days during the offering period Pennsylvania Investors may
request that their subscription be returned. If you wish to continue
your subscription in escrow until the Pennsylvania minimum subscription amount
is received, nothing further is required.
If you
wish to terminate your subscription for the Company’s common stock and have your
subscription returned please so indicate below, sign, date, and return to the
Escrow Agent, Xxxxx Fargo Bank, National Association.
I hereby
terminate my prior subscription to purchase shares of common stock of American
Realty Capital New York Recovery REIT, Inc. and request the return of my
subscription funds. I certify to American Realty Capital New York
Recovery REIT, Inc. that I am a resident of Pennsylvania.
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Signature:
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|||||
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Name:
|
|||||
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(please
print)
|
|||||
|
Date:
|
|||||
Please
send the subscription refund to:
