Exhibit 10.13
ESCROW AGREEMENT
________ Bank
address
Re: G REIT, Inc.
Ladies and Gentlemen:
G REIT, Inc., a Virginia corporation (the "Company"), will issue in a
public offering (the "Offering") its common stock (the "Stock") pursuant to a
Registration Statement on Form S-11 (the "Registration Statement") filed by the
Company with the Securities and Exchange Commission (the "SEC"). NNN Capital
Corp., a California corporation (the "Dealer Manager"), will act as dealer
manager for the Offering. In connection with such registration, the Company is
required to establish and maintain an escrow account in which to hold
subscribers' funds pending their use in accordance with the Registration
Statement. Accordingly, the Company is entering into this agreement with you to
set forth the terms on which you, as Escrow Agent, will hold and disburse the
proceeds from subscriptions for the purchase of the Stock in the Offering.
Based upon your representation and warranty that you are, and at all times
during the term of this agreement will be, deemed a "bank" as that term is
defined in Section 3(a)(6) of the Securities Exchange Act of 1934, as amended,
the Company hereby appoints you as Escrow Agent for purposes of holding the
proceeds from the subscriptions for the Stock, on the terms and conditions
hereinafter set forth:
1. Persons subscribing to purchase the Stock will be instructed by the
Dealer Manager or any soliciting dealers to remit the purchase price in the form
of checks, drafts or money orders (hereinafter called "instruments of payment")
payable to the order of, or funds wired in favor of, "_______ Bank, as Escrow
Agent." 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 Dealer Manager will send to you: (a) each subscriber's name,
address, number of shares purchased and purchase price remitted and (b) the
instruments of payment from such subscribers, for deposit by you into an
interest-bearing deposit account entitled "ESCROW ACCOUNT FOR THE BENEFIT OF
SUBSCRIBERS FOR COMMON STOCK OF G REIT, INC." (the "Escrow Account"), which
deposit shall occur within one (1) business day after you receive such
materials.
2. (a) You agree to promptly process for collection the instruments of
payment upon deposit into the Escrow Account. You will hold the deposited funds
in the Escrow Account until such funds are disbursed in accordance with
paragraph 3 hereof. If any of the instruments of payment are returned to you for
nonpayment, you shall promptly notify the Dealer Manager and the Company in
writing of such nonpayment, and you are authorized to debit the Escrow Account
in the amount of such return payment as well as any interest earned on the
amount of such payment.
(b) If the Company rejects any subscription for which you have
already collected funds, you shall, upon the written request of the Company,
promptly issue a refund check to the rejected subscriber. If the Company rejects
any subscription for which you have not yet collected funds but have submitted
the subscriber's check for collection, you shall promptly issue a check in the
amount of the subscriber's check to the rejected subscriber after you have
cleared such funds. If you have not yet submitted a rejected subscriber's check
for collection, you shall promptly remit the subscriber's check directly to the
subscriber.
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3. (a) You shall notify the Company on a weekly basis (and more
frequently if requested by the Company) of the amount of collected funds in the
Escrow Account, as well as the activity in the Escrow Account since the last
report. For purposes of this Agreement, the term "collected funds" shall mean
all funds received by the Escrow Agent that have cleared normal banking channels
and are in the form of cash.
(b) On each occasion that the Company shall notify you in writing
that disbursement of part or all of the collected funds in the Escrow Account is
appropriate for purposes described in the Registration Statement, you shall
promptly disburse to the Company such amount of collected funds by check or wire
transfer. With regard to all disbursements under this paragraph 3(b), you shall
be entitled to rely upon the instructions of the Company and need not conduct
any independent investigation to determine whether such disbursements are to be
used, or are in fact used, in connection with a permitted purpose under the
Registration Statement.
(c) The Company shall notify you of the termination of the
Registration Statement, and you shall maintain the Escrow Account until the
first to occur of (i) the first day after the termination of the Registration
Statement in which there is a zero balance in the Escrow Account; or (ii) the
date that is one year from the termination of the Registration Statement. If for
any reason whatsoever, all or a portion of the collected funds have not been
disbursed to the Company for application or commitment as stated in the
Registration Statement within one year from the date of the termination of the
Registration Statement, you shall promptly return those undisbursed funds to the
shareholders of the Company, each shareholder sharing in the return in the ratio
that the number of shares owned by such shareholder bears to the total number of
shares owned by all shareholders of the Company. The Company shall provide you
with a list of shareholders and their addresses, along with a statement of the
number of shares of Stock owned by each.
4. All funds in the Escrow Account, until disbursed to the Company in
accordance with paragraph 3 hereof, are to be held for the benefit of the
shareholders of the Company and are not to (i) be commingled with the monies or
become an asset of the Company or (ii) be subject to attachment, levy or other
encumbrance in any action by a third party against the Company.
5. Prior to the disbursement of funds deposited in the Escrow Account in
accordance with the provisions of paragraph 3 hereof, you shall invest all of
the funds deposited in the Escrow Account in "Short-Term Investments" (as
defined below) in compliance with SEC Rule 15c2-4 and you are further authorized
and you agree to reinvest all earnings and interest derived therefrom in
Short-Term Investments specified below. In the event that instruments of payment
are returned to you for nonpayment, you are authorized to debit the Escrow
Account in accordance with paragraph 2 hereof.
"Short-Term Investments" include obligations of, or obligations
guaranteed by, the United States government or bank money-market accounts or
certificates of deposit of national or state banks that have deposits insured by
the Federal Deposit Insurance Corporation (including certificates of deposit of
any bank acting as a depository or custodian for any such funds, including,
without limitation, such certificates or instruments of American International
Bank) which mature on or before the expiration of the Registration Statement,
unless such instrument cannot be readily sold or otherwise disposed of for cash
by the expiration of the Registration Statement without any dissipation of the
offering proceeds invested.
The following securities are not permissible investments:
(a) money market mutual funds;
(b) corporate equity or debt securities;
(c) repurchase agreements;
(d) bankers' acceptances;
(e) commercial paper; and
(f) municipal securities.
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6. You are entitled to rely upon written instructions you receive from the
Company, unless you have actual knowledge that such instructions are not valid
or genuine; provided that, if in your opinion, any instructions from the Company
are unclear, you may request clarification from the Company prior to taking any
action and if such instructions continue to be unclear, you may rely upon
written instructions from the Company's legal counsel in distributing or
continuing to hold any funds. However, you shall not be required to disburse any
funds attributable to instruments of payment which have not been collected by
you, provided you shall use your best efforts to promptly collect such funds
after your receipt of disbursement instructions from the Company and shall
disburse such funds in compliance with the disbursement instructions from the
Company.
7. As compensation for serving as Escrow Agent hereunder, you shall
receive a fee, as set forth in Schedule A attached hereto.
8. In performing any of your duties hereunder, you shall not incur any
liability to anyone for any damages, losses or expenses, except for your willful
misconduct, breach of trust or gross negligence. Accordingly, you shall not
incur any such liability with respect to any action taken or omitted (a) in good
faith upon advice of your counsel given with respect to any questions relating
to your duties and responsibilities under this Agreement or (b) in reliance upon
any instrument, including any written instrument or instruction provided for in
this Agreement, not only as to its due execution and validity and effectiveness
of its provisions but also as to the truth and accuracy of information contained
therein, which you shall in good faith believe to be genuine, to have been
signed or presented by a proper person or persons and to conform to the
provisions of this Agreement.
9. The Company hereby agrees to indemnify and hold you harmless against
any and all losses, claims, damages, liabilities and expenses, including
reasonable attorneys' fees and disbursements, that may be imposed on you or
incurred by you in connection with your acceptance of appointment as the Escrow
Agent hereunder, or the performance of your duties hereunder, including any
litigation arising from this Agreement or involving the subject matter hereof,
except where such losses, claims, damages, liabilities and expenses result from
your willful misconduct, breach of trust or gross negligence.
10. In the event of a dispute between the parties hereto sufficient in
your discretion to justify doing so, you shall be entitled to tender into the
registry or custody of any court of competent jurisdiction all money or property
in your hands under this Agreement, together with such legal pleadings as you
deem appropriate, and thereupon be discharged from all further duties and
liabilities under this Agreement. In the event of any uncertainty as to your
duties hereunder, you may refuse to act under the provisions of this Agreement
pending order of a court of competent jurisdiction and you shall have no
liability to the Company or to any other person as a result of such action. Any
such legal action may be brought in such court as you shall determine to have
jurisdiction thereof. The filing of any such legal proceedings shall not deprive
you of your compensation earned prior to such filing.
11. All communications and notices required or permitted by this Agreement
shall be in writing and shall be deemed to have been given when delivered
personally or by messenger or by overnight delivery service or when received via
telecopy or other electronic transmission, in all cases addressed to the person
for whom it is intended at such person's address set forth below or to such
other address as a party shall have designated by notice in writing to the other
party in the manner provided by this paragraph:
(g) if to the Company:
G REIT, Inc.
0000 X. Xxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxx, Xxxxxxxxxx 00000
fax: (000) 000-0000
Attn.: Xxxxxxx X. Xxxxxxxx, President
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(h) if to the Dealer Manager:
NNN Capital Corp.
0000 X. Xxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxx, Xxxxxxxxxx 00000
fax: (000) 000-0000
Attn.: Xxxxx X. Xxxxxxxx
(i) if to you:
________Bank
address
fax:
Attn.:
Each party hereto may, from time to time, change the address to which notices to
it are to be delivered or mailed hereunder by notice in accordance herewith to
the other parties.
12. This Agreement shall be governed by the laws of the State of
California as to both interpretation and performance without regard to the
conflict of laws rules thereof.
13. The provisions of this Agreement shall be binding upon the legal
representatives, successors and assigns of the parties hereto.
14. The Company and the Dealer Manager hereby acknowledge that you are
serving as Escrow Agent only for the limited purposes herein set forth, and
hereby agree that they will not represent or imply that you, by serving as
Escrow Agent hereunder or otherwise, have investigated the desirability or
advisability of investment in the Company or have approved, endorsed or passed
upon the merits of the Stock or the Company, nor shall they use your name in any
manner whatsoever in connection with the offer or sale of the Stock other than
by acknowledgment that you have agreed to serve as Escrow Agent for the limited
purposes herein set forth.
15. This Agreement and any amendment hereto may be executed by the parties
hereto in one or more counterparts, each of which shall be deemed to be an
original.
16. The Escrow Agent shall be bound only by the terms of this Escrow
Agreement and shall not be bound by or incur any liability with respect to any
other agreements or understanding between any other parties, whether or not the
Escrow Agent has knowledge of any such agreements or understandings.
17. Indemnification provisions set forth herein shall survive the
termination of this Agreement.
18. Unless otherwise provided in this Agreement, final termination of this
Escrow Agreement shall occur on the date that all funds held in the Escrow
Account are distributed either (a) to the Company or to subscribers pursuant to
paragraph 3 hereof or (b) to a successor escrow agent upon written instructions
from the Company.
19. The Escrow Agent has no responsibility for accepting, rejecting or
approving subscriptions.
20. This Agreement shall not be modified, revoked, released or terminated
unless reduced to writing and signed by all parties hereto, subject to the
following paragraph.
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If, at any time, any attempt is made to modify this Agreement in a manner
that would increase the duties and responsibilities of the Escrow Agent or to
modify this Agreement in any manner which the Escrow Agent shall deem
undesirable, or at any other time, the Escrow Agent may resign by providing
written notice to the Company and until (a) the acceptance by a successor escrow
agent as shall be appointed by the Company or (b) thirty (30) days after such
written notice has been given, whichever occurs sooner, the Escrow Agent's only
remaining obligation shall be to perform its duties hereunder in accordance with
the terms of the Agreement.
21. The Escrow Agent may resign at any time from its obligations under
this Escrow Agreement by providing written notice to the Company. Such
resignation shall be effective on the date specified in such notice which shall
be not less than thirty (30) days after such written notice has been given. The
Escrow Agent shall have no responsibility for the appointment of a successor
escrow agent.
22. The Escrow Agent may be removed for cause by the Company by written
notice to the Escrow Agent effective on the date specified in such written
notice. The removal of the Escrow Agent shall not deprive the Escrow Agent of
its compensation earned prior to such removal.
Agreed to as of the ___day of _______, 200_.
G REIT, INC.
By:_______________________________________________
Name: ____________________________________________
Title: _____________________________________________
NNN CAPITAL CORP.
By:_______________________________________________
Name: ____________________________________________
Title: _____________________________________________
The terms and conditions contained above are hereby accepted and agreed to by:
_________ BANK
By:______________________________________
Name:____________________________________
Title:___________________________________
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SCHEDULE A TO
ESCROW AGREEMENT FOR
G REIT, INC.
Schedule of Fees - Escrow Agency
________ Bank
Administration Fee - Payable Annually..................................................... $________
Commencing on the date of this Agreement and
on the same day of each year thereafter.
For costs incurred in connection with returned checks...................................... $_____
per returned check
Express Mail and Postage................................................................... At Cost
Photocopying.....................................................................(per page) $ _____
Outgoing Wires (each)...................................................................... $_____
Official Checks (each)..................................................................... $_____
Legal Process....................................................(plus photocopying charges) $_____
Outside Courier Service.................................................................... At Cost
Charges for refunding subscription proceeds if all of the proceeds have not been
disbursed to the Company within one year of the termination of the Registration
Statement will be negotiated between the parties.
Charges for filing reports or information as may be required by Internal Revenue
Service regulations or for the performance of any services not contemplated at
the time of opening account, or not of a routine administrative nature, or not
specifically covered in this schedule, will be negotiated between the parties.
Actual out-of-pocket expenses such as attorney's fees, cost of special checks,
postage, insurance, telephone, telegraph, etc., will be billed at cost.
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