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EXHIBIT 4.2
Georgia-Carolina Bancshares, Inc.
P.O. Box 1560
Thomson, Georgia 30326
January 22, 1998
The Bankers Bank
0000 Xxxxx Xxxxx Xxxx
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-4098
Attention: Xxxxxxx X. Xxxxxxx
Gentlemen:
(1) Georgia-Carolina Bancshares, Inc., a Georgia corporation (the
"Company"), proposes to offer for sale up to 740,741 shares of its $.001 par
value common stock (the "Common Stock"), which shares shall be registered under
the Securities Act of 1933, as amended, by the filing of a Resignation
Statement on Form SB-2 with the Securities and Exchange Commission. Shares will
be offered at a price of $13.50 each. The minimum subscription per subscriber
is 100 shares.
(2) The Company hereby appoints and designates you as Escrow Agent for
the purposes set forth herein. By your signature hereto, you acknowledge and
accept said appointment and designation. The Company understands that you, by
accepting said appointment and designation, in no way endorse the merits of the
offering of the shares described herein. The Company agrees to notify any
person acting on its behalf that your position as Escrow Agent does not
constitute such an endorsement, and to prohibit said persons from the use of
your name as an endorser of such offering. The Company further agrees to allow
you to review any sales literature in which your name appears and which is used
in connection with such offering.
(3) The Company shall deliver all payments received in purchase of the
shares (the "Subscription Funds") to you in the form in which they are received
by noon of the next business day after their receipt by the Company, and the
Company shall deliver to you within five (5) calendar days copies of written
acceptances of the Company for shares in the Company for which the Subscription
Funds represent payment. Upon receipt of such written acceptance by the
Company, the Escrow Agent shall deposit such funds into the an escrow account
(the "Escrow Account"). The Company shall also deliver to you a copy of the
completed Subscription Agreement for each subscriber, along with such
subscriber's name, address, number of shares subscribed and social security or
taxpayer identification number.
(4) Subscription Funds shall be held and disbursed by you in
accordance with the terms of this Agreement.
(5) In the event any Subscription Funds are dishonored for payment for
any reason, you agree to orally notify the Company immediately thereof and to
confirm same in writing and to return the dishonored Subscription Funds to the
Company in the form in which they were delivered to you.
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(6) Should the Company elect to accept a subscription for less than
the number of shares shown in the purchaser's Subscription Agreement, by
indicating such lesser number of shares on the written acceptance of the
Company transmitted to you, you shall deposit such payment in the Escrow
Account and then remit within ten (10) days after such deposit to such
subscriber at the address shown in his Subscription Agreement that amount of
his Subscription Funds in excess of the amount which constitutes full payment
for the number of subscribed shares accepted by the Company as shown in the
Company's written acceptance, without interest or diminution. Said address
shall be provided by the Company to you as requested.
(7)(a) As used herein, the term "Total Receipts" shall mean the sum of
all Subscription Funds delivered to you pursuant to Paragraph (3) hereof, less
all Subscription Funds returned pursuant to Paragraphs (5) and (6) hereof and
Subscription Funds which have not been paid by the financial institution upon
which they are drawn.
(b) As used herein, the term "Expiration Date" shall mean
_______________, 19__; provided, however, in the event that you are given oral
notification, followed in writing, by the Company that it has elected to extend
the offering for an additional period of 90 days after the initial period, then
the Expiration Date shall mean the date which marks the 180th day after the
date of the Prospectus; provided further, in the event that you are given oral
notification, followed in writing, by the Company that it has elected to extend
the offering for an additional period of 90 days after the first extension,
then the Expiration Date shall mean the date which marks the 270th day after
the date of the Prospectus; provided, further, in the event that you are given
oral notification, followed in writing, by the Company that it has elected to
extend the offering for an additional period of 90 days after the second
extension, then the Expiration Date shall mean the date which marks the 360th
day after the date of the Prospectus.
(c) If Total Receipts are greater than or equal to $7,000,006 on or
before the Expiration Date, you shall, upon receipt of 24-hour written
instructions from the Company, no later than 2:00 P.M., Eastern Time on the
Closing Date (as that term is defined herein), remit all amounts representing
Subscription Funds, plus any profits or earnings thereon after deducting your
fees, if any, held by you pursuant hereto in accordance with such instructions.
(8) If (i) Total Receipts are less than $7,000,006 as of 5:00 P.M.,
Eastern Time on the Expiration Date, or (ii) the offering is canceled by the
Company at any time prior to the Expiration Date, then you shall promptly remit
to each subscriber at the address set forth in his Subscription Agreement an
amount equal to the amount of his Subscription Funds thereunder, adjusted for
his allocated share (weighted by time on deposit and amount) of any profits or
earnings earned on the investment of the Subscription Funds. The Company hereby
agrees to provide to you in writing the specific allocations of any profits or
earnings attributable to each subscriber hereunder.
(9) Pending disposition of the Subscription Funds under this Agreement
and unless and until otherwise authorized by oral instructions, followed in
writing, given by Xxxxx X. Xxxxxxxx, Xx., you are authorized, by means of a
"Sweep" or other automatic investment program, to invest the Subscription Funds
in blocks of $10,000 in federal funds. Interest and other earnings shall start
accruing on such funds as soon as such funds would be deemed to be available
for access under applicable banking laws and pursuant to your own banking
policies. Upon oral instructions, followed in writing, given by Xxxxx X.
Xxxxxxxx, Xx., you shall invest the Subscription Funds in short-term direct
obligations of the United States government, in short-term FDIC or FSLIC
insured certificates of deposit, and/or in the Fidelity Institutional U.S.
Treasury Cash Portfolio, for short-term obligations of the United States
government, but in any case with maturities of 90 days or less.
For purposes of Paragraph 8 above, the specific allocations of net
profits attributable to each subscriber shall be determined by the Company as
follows: each subscriber's allocated share of earnings on the Subscription
Funds, after deducting your fees, if any, shall be that fraction (i) the
numerator of which is
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the dollar amount of such subscriber's accepted subscription multiplied by the
number of days between the date of acceptance of the purchaser's subscription
and the date of the offering's termination, inclusive (the subscriber's "Time
Subscription Factor"), and (ii) the denominator of which is the aggregate Time
Subscription Factors of all purchasers depositing Subscription Funds in the
Escrow Account.
(10) Your obligations as Escrow Agent hereunder shall terminate upon
your transferring all funds you hold hereunder pursuant to the terms of
Paragraphs (7) or (8) herein, as applicable.
(11) As used herein, "Closing Date" shall mean the date of receipt by
you of (i) written notification from the Company that the shareholders of the
Company have approved the offering, (ii) Total Receipts aggregating $7,000,006,
and (iii) executed Subscription Agreements and copies of written acceptances of
the Company in connection therewith.
(12) You shall be protected in acting upon any written notice,
request, waiver, consent, certificate, receipt, authorization, or other paper
or document which you believe to be genuine and what it purports to be.
(13) You shall not be liable for anything which you may do or refrain
from doing in connection with this Escrow Agreement, except your own gross
negligence or willful misconduct.
(14) You may confer with legal counsel in the event of any dispute or
question as to the construction of any of the provisions hereof, or your duties
hereunder, and you shall incur no liability and you shall be fully protected in
acting in accordance with the opinions and instructions of such counsel. Any
and all expenses and legal fees in this regard are payable from the
Subscription Funds unless paid by the Company.
(15) In the event of any disagreement between the Company and any
other person resulting in adverse claims and demands being made in connection
with any Subscription Funds involved herein or affected hereby, you shall be
entitled to refuse to comply with any such claims or demands as long as such
disagreement may continue, and in so refusing, shall make no delivery or other
disposition of any Subscription Funds then held by you under this Agreement,
and in so doing you shall be entitled to continue to refrain from acting until
(a) the right of adverse claimants shall have been finally settled by binding
arbitration or finally adjudicated in a court assuming and having jurisdiction
of the Subscription Funds involved herein or affected hereby or (b) all
differences shall have been adjusted by agreement and you shall have been
notified in writing of such agreement signed by the parties hereto. In the
event of such disagreement, you may, but need not, tender into the registry or
custody of any court of competent jurisdiction all money or property in your
hands under the terms of this Agreement, together with such legal proceedings
as you deem appropriate and thereupon to be discharged from all further duties
under this Escrow Agreement. The filing of any such legal proceeding shall not
deprive you of your compensation earned prior to such filing. You shall have no
obligation to take any legal action in connection with this Agreement or
towards its enforcement, or to appear in, prosecute or defend any action or
legal proceeding which would or might involve you in any cost, expense, loss or
liability unless indemnification shall be furnished.
(16) You may resign for any reason, upon thirty (30) days written
notice to the Company. Upon the expiration of such thirty (30) day notice
period, you may deliver all Subscription Funds and Subscription Agreements in
your possession under this Escrow Agreement to any successor Escrow Agent
appointed by the Company, or if no successor Xxxxxx Agent has been appointed,
to any court of competent jurisdiction. Upon either such delivery, you shall be
released from any and all liability under this Escrow Agreement. A termination
under this paragraph shall in no way change the terms of paragraphs 15 and 17
affecting reimbursement of expenses, indemnity and fees. You shall have the
right to deduct from the Subscription Funds transferred to any successor Escrow
Agent any outstanding and unpaid expenses or fees.
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(17) You agree to charge your customary and normal fee for your
services hereunder. A copy of the current schedule is attached hereto. The fee
schedule may be modified from time to time. The acceptance fee and expenses
shall be paid in advance or at closing by the Company. Any subsequent fees and
expenses will be paid by the Company upon receipt of invoice.
(18) All notices and communications hereunder shall be in writing and
shall be deemed to be duly given if sent by overnight delivery service or
registered or certified mail, return receipt requested, to the respective
addresses set forth herein. You shall not be charged with knowledge of any
fact, including but not limited to performance or non-performance of any
condition, unless you have actually received written notice thereof from the
Company or its authorized representative clearly referring to this Escrow
Agreement.
(19) The rights created by this Escrow Agreement shall inure to the
benefit of, and the obligations created hereby shall be binding upon the
successors and assigns of you and the parties hereto. Notwithstanding the
foregoing, the Company may not assign its rights hereunder without your prior
written consent.
(20) This Escrow Agreement shall be construed and enforced according
to the laws of the State of Georgia.
(21) This Escrow Agreement shall terminate and you shall be discharged
of all responsibility hereunder at such time as you shall have completed your
duties hereunder.
(22) This Escrow Agreement may be executed in several counterparts,
which taken together shall constitute a single document.
(23) This Escrow Agreement constitutes the entire understanding and
agreement of the parties hereto with respect to the transactions described
herein and supersedes all prior agreements or understandings, written or oral,
between the parties with respect thereto. Further, this Escrow Agreement may
only be amended by a written amendment signed by the parties hereto.
(24) If any provision of this Escrow Agreement is declared by a court
of competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force and effect without being
impaired or invalidated in any way.
(25) The Company shall provide you with its Employer Identification
Number as assigned by the Internal Revenue Service. Additionally, the Company
shall complete and return to you any and all tax forms or reports required to
be maintained or obtained by you. In the event that Subscription Funds are
returned to subscribers pursuant to paragraph 8 hereof, you shall, based upon
the information available to you, file with the Internal Revenue Service and
send to each subscriber a Form 1099-INT with respect to contributions of
interest to subscribers. All interest or other income earned under this Escrow
Agreement which is payable to the Company pursuant to paragraph 7 hereof shall
be allocated and paid as directed by the Company and reported to the Internal
Revenue Service as having been so allocated and paid.
(26) Your signature hereto is your consent that a signed copy hereof
may be filed with the various regulatory authorities of the State of Georgia
and with any Federal Government agencies or regulatory authorities.
[THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK]
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Please indicate your acceptance of this Agreement by executing a copy
of this letter and returning it to the undersigned.
Very truly yours,
GEORGIA-CAROLINA BANCSHARES, INC.
By:/s/ X. Xxxxxx Xxxx, Xx.
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X. Xxxxxx Xxxx, Xx.
Senior Vice President and Chief
Financial Officer
Attest:
/s/ Xxxxxx X. Xxxx
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Executive Vice President
(CORPORATE SEAL)
ACCEPTED AND AGREED:
THE BANKERS BANK
By:/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Senior Vice President
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FEE SCHEDULE
Pursuant to Paragraph 17 of the Escrow Agreement (the "Escrow Agreement")
between Georgia-Carolina Bancshares, Inc. (the "Company") and The Bankers Bank
(the "Escrow Agent"), this schedule, if agreed to by the Company and the Escrow
Agent, shall become an integral part of the Escrow Agreement.
FEE OF ESCROW AGENT
The Company shall pay the Escrow Agent a fee of $2,000 for its services
hereunder. The Escrow Account (as defined in the Escrow Agreement) will accrue
a service charge of $15.00 per month. In addition, a $20.00 per check fee will
be charged if the Escrow Account is refunded due to a subscriber's failure to
properly complete a subscription. These fees are payable upon the release of
the Subscription Funds (as defined in the Escrow Agreement) pursuant to Section
7 of the Escrow Agreement and the Escrow Agent is authorized to deduct such
fees from the Subscription Funds prior to any release thereof.
Agreed to this 22nd day of January, 1998 by:
GEORGIA-CAROLINA BANCSHARES, INC. THE BANKERS BANK
By:/s/ X. Xxxxxx Xxxx, Xx. By: /s/ Xxxxxxx X. Xxxxxxx
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X. Xxxxxx Xxxx, Xx., Senior Vice President and Xxxxxxx X. Xxxxxxx
Chief Financial Officer Senior Vice President
