EXHIBIT 10.1
ESCROW AGREEMENT
ESCROW AGREEMENT
This Escrow Agreement is dated and effective as of the __ day of August,
2001 and is made among ICON Securities Corp. (the "Dealer-Manager"), ICON
Income Fund Nine, LLC, a Delaware limited liability company (the "Company"),
and The _____________ Bank, A _____________ State Chartered Bank (the "Escrow
Agent").
RECITALS
A. The Company proposes to offer and sell up to 100,000 shares (the
"Shares") of limited partnership interest to investors at $1,000 per Share
pursuant to a registration statement (the "Registration Statement") filed with
the U.S. Securities and Exchange Commission (the "SEC").
B. The Company has agreed that the subscription price paid in cash by
subscribers will be refunded to them if less than 1,200 Shares (the "Minimum
Offering") have been sold and payment therefore received by the earlier to
occur of the date (the "Escrow Termination Date") which is (1) the anniversary
of the date on which the Offering Period (as defined in the Registration
Statement) commenced or (2) any earlier date on which ICON Capital Corp. the
manager of the Company (the "Manager"), may elect to terminate the Offering
Period (as defined in Company's Prospectus).
C. The Company desires to establish an escrow with Escrow Agent for
subscription payments pending receipt of aggregate subscriptions for not less
than One Thousand Two Hundred (1,200) Shares ($1,200,000 of Shares) have been
received (the time at which the escrow established by this Agreement as to
subscriptions from residents of all states other than Pennsylvania may be
released) or Five Thousand (5,000) Shares ($5,000,000 of Shares) have been
received (the time at which the escrow established by this Agreement as to
subscriptions from residents of Pennsylvania may be released),
D. The Escrow Agent is willing to serve as Escrow Agent upon the terms and
conditions hereinbelow set forth.
NOW, THEREFORE, in consideration of the premises and other good and
valuable considerations, the receipt and sufficiency of which is hereby
acknowledged by the parties, the parties covenant and agree as follows:
1. Deposit with Escrow Agent: The Escrow Agent agrees that it will, from time
to time, accept subscription payments for Shares (the "Escrow and Deposit")
received by it from subscribers or broker-dealers authorized to sell Shares
(the "Selling Dealers"). Until such time at least 1,200 Shares have been sold
and the related Escrow Deposits in an aggregate amount not less than $1,200,000
have been duly distributed in accordance with Section 3.1 hereof, all
subscription checks shall be made payable to the Escrow Agent. Subscription
Agreements for the Shares received by the Company shall be reviewed for
accuracy by the Company and, immediately thereafter, the Company shall deliver
to Escrow Agent information describing (1) the name, address and Federal Tax
Identification Number of the subscriber, (2) that number of Shares subscribed
for by subscriber, and (3) the subscription price.
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2. Investment of Escrow Deposit. The Escrow Agent shall, upon receipt of the
checks remitted to it, deposit all Escrow Deposits in federally insured
interest-bearing savings or money market accounts. All trust investment orders
involving Treasuries, commercial paper and other direct investments will be
executed through X.X. Xxxxxx Xxxxxxx Asset Management (JPFAM), in the investment
management division of X.X. Xxxxxx Chase. Subject to the principles of best
execution, transactions are effected on behalf of your account through
broker-dealer selected by JPFAM. In this regard, JPFAM seeks to attain the best
overall result for your account, taking into consideration quality of service
and reliability. An agency fee will be assessed in connection with each
transaction. Periodic statements will be provided to the Dealer-Manager and the
Company reflecting transactions executed on behalf of the Escrow Fund. The
Dealer-Manager and the Company, upon written request, will receive a statement
of transaction details upon completion of any securities transaction in the
Escrow Fund without any additional cost.
3. Distribution of Escrow Deposit. The Escrow Agent shall distribute the Escrow
Deposits as set forth in this Section 3, and the Escrow Agent's obligations
(other than those of Sections 3.3 and 5 hereof which by their nature must
survive this Agreement) shall terminate upon such distributions, and the Escrow
Agent shall be irrevocably released and discharged from any and all further
responsibility or liability with respect to this Agreement.
3.1 At any time following sale of at least 1,200 Shares (exclusive of
subscriptions from residents of The Commonwealth of Pennsylvania), the
Dealer-Manager or the Manager may (a) certify that the sale of such Shares has
satisfied the Minimum Offering required for the Company to break escrow as to
the subscription payments of residents of States other than The Commonwealth of
Pennsylvania and (b) stipulate the date on which the first closing date and
subsequent closing dates of the Company and the release of the Escrow Deposits
with respect to such subscribers to the Company and all related earnings
thereon to such subscribers shall occur. At any time following sale of at least
5,000 Shares (inclusive of subscriptions by residents of all States inclusive
of subscriptions from residents of The Commonwealth of Pennsylvania), the
Dealer-Manager or Manager may (a) certify that the sale of such Shares has
satisfied the Minimum Offering required for the Company to break escrow as to
all subscription payments (including those from residents of The Commonwealth
of Pennsylvania) and (b) stipulate the date on which the next closing date of
the Company and the release of the Escrow Deposits then being held on behalf of
all subscribers (including, without limitation, residents of The Commonwealth
of Pennsylvania) to the Company and all related earnings thereon to such
subscribers shall occur. Upon collection by the Escrow Agent of good funds for
such subscription payments, the Escrow Agent shall make such distributions on
the applicable closing date. Certification by an officer of the Manager that at
least 1,200 Shares or 5,000 Shares (as the case may be) have been timely sold
as described in the first two sentences of this Section 3.1 and the receipt by
Escrow Agent of $1,200,000 or $5,000,000 (as the case may be) in cash from
subscribers for Shares, shall constitute sufficient evidence for the purposes
of this Section 3.1 that such events have occurred.
3.2 After satisfaction of the conditions of Section 3.1 above, all checks,
payable to the Escrow Agent, shall, upon receipt by Escrow Agent, be endorsed
(without recourse to Escrow Agent) for deposit into such accounts as directed by
the Company. The Escrow Agent shall have no duty to solicit any payments which
may be due it hereunder.
3.3 If any Escrow Deposits do not become deliverable to the Company
pursuant to Section 3.1 above on or prior to the Escrow Termination Date (as
defined above), the Escrow Agent shall return such Escrow Deposits to the
applicable subscribers in an amount equal to the subscription amount theretofore
paid by each of them together with interest earned thereon. In the event that
(a) rescission of an individual subscription is required to be offered to an
individual subscriber under provisions of applicable state law or (b) a
subscription for a resident of a state may only be held in escrow for a shorter
period of time than provided in the preceding sentence under provisions of
applicable state law, then the Escrow Agent shall promptly, following receipt of
such subscriber's duly executed request for rescission (in the case of
rescission) or the Manager's direction to release such subscription (in the case
of expiration of an applicable state statutory maximum escrow period), return
such subscriber's Escrow Deposit to him in an amount equal to the subscription
amount theretofore paid by him together with interest earned thereon. For
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purposes of the preceding sentence, rescission must be offered to each
Pennsylvania subscriber for whom an Escrow Deposit is held by the Escrow Agent
at the end of the 120 day period which began with the Escrow Agent's receipt of
his or her subscription payment. If such rescission offer is not accepted, such
Escrow Deposit may continue to be held for one or more successive 120-day escrow
periods at the end of each of which rescission must again be offered to each
such subscriber.
In no event shall any Escrow Deposit be held in escrow for more than one
year before either being (a) released to the Company (upon a closing pursuant
to Section 3.1 and 3.2) or (b) returned to the applicable Subscriber (in the
event such Escrow Deposit is returned the applicable subscriber for whom it is
being held pursuant to Section 3.3). The Escrow Agent will not be required to
communicate with any subscriber(s). All inquiries on behalf of the
subscriber(s) will be coordinated through the Company.
4. Distribution of Interest. If the Escrow Deposits become deliverable to the
Company pursuant to Section 3.1 or to the subscribers pursuant to Section 3.3
above, the Manager shall compute for the distribution in accordance with such
computations the pro rata share of the investment earnings of each Escrow
Deposit. Each subscriber's pro rata share of investment earnings shall be
computed as follows:
Investment Earnings times (individual subscription amount times days held)
Total subscription amounts times days held
Such pro rata share of investment earnings shall be distributed to each
subscriber upon admission of the subscriber as a limited partner of the Company
or upon return of his/her subscription amounts.
5. Duties and Liability of Escrow Agent.
5.1 The Dealer-Manager and the Company each represent that its correct
Taxpayer Identification Number ("TIN") assigned by the Internal Revenue Service
or any other taxing authority is set forth in Schedule 1. Upon execution of this
agreement, each party shall provide the Escrow Agent with a fully executed W-8
or W-9 Internal Revenue Service form. Any interest or other income earned under
the Escrow Agreement shall be allocated and paid as provided herein and reported
by the recipient to the Internal Revenue Service as having been so allocated and
paid. Notwithstanding such written directions, Escrow Agent shall report and, as
required withhold any taxes as it determines may be required by any law or
regulation in effect at the time of the distribution. In the absence of timely
direction, all proceeds of the Escrow Agent as provided in Section 3. In the
event that any earnings remain undistributed at the end of any calendar year,
Escrow Agent shall report to the Internal Revenue Service or such other
authority such earnings as it deems appropriate or as required by any applicable
law or regulation or, to the extent consistent therewith, as directed in writing
by the Dealer-Manager and the Company. In addition, Escrow Agent shall withhold
any taxes it deems appropriate and shall remit such taxes to the appropriate
authorities.
5.2 The Escrow Agent shall have the right to liquidate any investments
held, in order to provide funds necessary to make required payments under this
Agreement. The Escrow Agent in its capacity as escrow agent hereunder shall not
have any liability for any loss sustained as a result of any investment made
pursuant to the Instructions of the parties hereto or as a result of any
liquidation of any investment prior to its maturity or for the failure of the
parties to give the Escrow Agent instructions to invest or reinvest the Escrow
Fund or any earnings thereon.
5.3 Any corporation into which the Escrow Agent in its individual capacity
may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Escrow Agent in its individual capacity shall be a party, or any corporation to
which substantially all the corporate trust business of the Escrow Agent in its
individual capacity may be transferred, shall be the Escrow Agent under this
Agreement without farther act.
5.4 Anything in this agreement to the contrary notwithstanding, in no event
shall the Escrow Agent be liable for special, indirect or consequential loss or
damage of any kind whatsoever
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(including but not limited to lost profits), even if the Escrow Agent has been
advised of the likelihood of such loss or damage and regardless of the form of
action.
5.5 The duties and obligations of the Escrow Agent shall be determined
solely by the express provisions of this Agreement and shall be limited to the
performance of such duties and obligations as are specifically set forth
herein.
5.6 In performing any of its duties under this Agreement, or upon the
claimed failure to perform its duties hereunder, Escrow Agent shall not be
liable to anyone for any damages, losses, or expenses which it may incur as a
result of The Escrow Agent so acting, or failing to act; provided, however,
Escrow Agent shall be liable for damages arising out of its willful default or
gross negligence under this Agreement, as determined by a court of competent
jurisdiction. Accordingly, Escrow Agent shall not incur any such liability with
respect to (i) any action taken or omitted to be taken in good faith upon
advice of its counsel or counsel for the Company given with respect to any
questions relating to the duties and responsibilities of the Escrow Agent
hereunder or (ii) any action taken or omitted to be taken in reliance upon any
document, including any written notice or instructions provided for in this
Agreement, not only as to its due execution and to the validity and
effectiveness of its provisions but also as to the truth and accuracy of any
information contained therein, which the Escrow Agent shall in good faith
believe to be genuine, to have been signed or presented by proper person or
persons and to conform with the provision of this Agreement. The Escrow Agent
may execute any of its powers and perform any of its duties hereunder directly
or though agents or attorneys (and shall be liable only for the careful
selection of any such agent or attorney) and may consult with counsel,
accountants and other skilled persons to be selected and retained by it. The
Escrow Agent shall not be liable for anything done, suffered or omitted in good
faith by it in accordance with the advice or opinion of any such counsel,
accountants or other skilled persons.
5.7 Each of the Company and Dealer-Manager hereby respectively agree to
indemnify and hold harmless the Escrow Agent and its directors, officers,
agents and employees (the "indemittees"), against any and all losses, claims,
damages, liabilities and expenses, including, without limitation, reasonable
costs of investigation and counsel fees and disbursement which may be incurred
by it resulting from any act or omission of the Company or the Escrow Agent;
except, that if Escrow Agent shall be found guilty of willful default or gross
negligence under this Agreement by any court of competent jurisdiction, then,
in that event, Escrow Agent shall bear all such losses, claims, damages and
expenses. The indemnity provided by this Section 5.7 shall survive the
termination of this Agreement.
In the event that the Escrow Agent shall be uncertain as to its duties or
rights hereunder or shall receive instructions, claims or demands from any
party hereto which, in its opinion, conflict with any of the provisions of this
Escrow Agreement, it shall be entitled to refrain from taking any action and
its sole obligation shall be to keep safely all property held in escrow until
it shall be directed otherwise in writing by all of the other parties hereto or
by a final order or judgement of a court of competent jurisdiction.
5.9 In the event funds transfer instructions are given (other than in
writing at the time of execution of the Agreement), whether in writing, by
telecopier or otherwise, the Escrow Agent is authorized to seek confirmation of
such instruction by telephone call-back to the person or persons designated an
Schedule 2 hereto, and the Escrow Agent may rely upon the confirmations
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of anyone purporting to be the person or persons so designated. The persons and
telephone numbers for call-backs may be changed only in a writing actually
received and acknowledged by the Escrow Agent. The parties to this Agreement
acknowledge that such security procedure is commercially reasonable.
5.10 It is understood that the Escrow Agent and the beneficiary's bank in
any funds transfer may rely solely upon any account numbers or similar
identifying number provided by either of the parties hereto to identify (1) the
beneficiary, (2) the beneficiary's bank, or (3) an intermediary bank. The
Escrow Agent may apply any of the escrowed funds for any payment order it
executes using any such identifying number, even where its use may result in a
person other than the beneficiary being paid, or the transfer of funds to a
bank other than the beneficiary's bank, or an intermediary bank designated.
6. If any checks or other instruments deposited in the escrow account
established hereunder prove uncollectible, the Company shall promptly reimburse
the Escrow Agent therefor upon request and the Escrow Agent shall deliver the
returned checks or other instruments to the Company.
7. Notices. All notices, requests, demands and other communication or
deliveries required or permitted to be given hereunder shall be in writing and
shall be deemed to have been duly given if delivered personally, given by
prepaid telegram or deposited for mailing, first class, postage prepaid,
registered or certified mail, as follows:
If to the subscribers for Shares: To their respective addresses
as specified in their Subscription Agreements.
If to the Company: ICON Income Fund Nine, LLC, a Delaware limited liability company
c/o ICON Capital Corp.
000 Xxxxxxxxx Xxxxxx, #0000
Xxx Xxxx, XX 00000
Attention- Xxxxxx X. Xxxxxx, Executive Vice President
If to the Escrow Agent:
_______________________ Bank
____________________________
____________________________
Attention: _________________
8. Resignation or Removal of Escrow Agent. The Escrow Agent, or any successor
to it hereafter appointed, may at any time resign and be discharged from the
duties and obligations created by this Agreement by giving at least thirty (30)
days prior written notice to the Company and the Dealer-Manager and accounting
in full for all sums delivered to, and held, by it and all earning thereon
while Escrow Agent hereunder to the Company, Dealer-Manager and successor
Escrow Agent. The Escrow Agent may be removed at any time upon sixty (60) days
prior written notice by any instrument purportedly signed by an authorized
representative of the Company and the Dealer-Manager. Any successor Escrow
Agent shall deliver to the Escrow Agent, Company and Dealer-Manager a written
instrument accepting such appointment hereunder and shall accept
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delivery of the Escrow Account to hold and distribute same in accordance with
the terms of this Agreement. If no successor Escrow Agent shall have been
appointed within thirty (30) days after the Company and Dealer-Manager receive
notice of the Escrow Agent's intention to resign or within sixty (60) days of
the Escrow Agent's receipt of notice of its removal, the Escrow Agent shall
deliver all amounts deposited with it in the Escrow Account and all earnings
thereon to a national bank with a net worth of not less than $100,000.00
designated by the Escrow Agent which has agreed in writing to accept such
monies and to act as substitute Escrow Agent in compliance with the terms of
this Agreement. Upon such delivery and acceptance, the Escrow Agent shall be
discharged from any future obligations under this Agreement.
9. General.
9.1 This Escrow Agreement shall be governed by and be construed and
enforced in accordance with the laws of the State of New York, exclusive of
conflicts of laws provisions thereunder, The parties hereto consent to the
jurisdiction of all courts of the State of New York and the venue of the courts
located in the county in which the Escrow Agent is located to resolve all
disputes pertaining to this Agreement and any ancillary agreements entered into
in furtherance of the purposes hereof and agree that such jurisdiction shall be
exclusive. Each party hereto irrevocably waives any objection on the grounds of
venue, forum non-conveniens or any or any similar grounds and irrevocably
consents to service of process by mail or in any other manner permitted by
applicable law and consents to the jurisdiction of the courts located in the
State of New York. The parties further hereby waive any right to a trail by jury
with respect to any lawsuit or judicial proceeding arising or relating to this
Escrow Agreement. No party to this Escrow Agreement is liable to any other party
for losses due to, or if it is unable to perform its obligations under the terms
of this Escrow Agreement because of, acts of God, fire, floods, strikes,
equipment or transmission failure, or other causes reasonably beyond its
control.
9.2 The section headings contained herein are for reference purposes only
and shall not in any way affect the meaning or interpretation of this
Agreement.
9.3 This Escrow Agreement sets forth the entire agreement and understanding
of the parties in respect to this escrow agreement and supersedes all prior
agreements, arrangements and understandings relating to the subject matter
hereof.
9.4 This Escrow Agreement may be amended, modified, superseded or canceled,
and any of the terms or conditions hereof may be waived, only by a written
instrument executed by each party hereto or, in the case of a waiver, by the
party waiving compliance, The failure of any party at any time or times to
require performance of any provision hereof shall in no manner affect the right
at a later time to enforce the same. No waiver of any party of any condition,
or of the breach of any term contained in this Agreement, whether by conduct or
otherwise, in any one or more instances shall be deemed to be construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of the breach of any other terms of this Agreement.
9.5 This Escrow Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the game instrument. All signatures of the
parties to this Agreement may be transmitted by facsimile, and such facsimile
will, for all purposes, be deemed to be the original signature of such party
whose signature it reproduces, and will be binding upon such party.
9.6 This Escrow Agreement shall inure to the benefit of the parties hereto
and their respective successors and assigns.
9.7 The Escrow Agent shall have the right to withhold an amount equal to
the amount due and owing to the Escrow Agent, plus any costs and expenses the
Escrow Agent shall reasonably believe may be incurred by the Escrow Agent in
connection with the termination of the Escrow Agreement.
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10. Representation of the Company. The Company hereby acknowledges that the
status of the Escrow Agent with respect to the offering of the Shares is that of
agent only for the limited purposes herein set forth, and hereby agrees it will
not represent or imply that Escrow Agent, by serving as Escrow Agent hereunder
or otherwise, has investigated the desirability or a viability of investment in
the Shares, of has approved, endorsed or passed upon the merits of the Shares,
nor shall the Company use the name of Escrow Agent in any manner whatsoever in
connection with the offer or sale of the Shares, other than by acknowledgment
that it has agreed to serve as Escrow Agent for the limited purposes herein set
forth.
11. Fees. Upon execution of this Agreement, the Company will pay the Escrow
Agent Fee's outlined in Schedule I attached hereto,
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
ICON Securities Corp.
As Dealer-Manager
By: ________________________
Xxxxxx X. Xxxxxx
Executive Vice President
ICON Income Fund Nine, LLC, a Delaware limited liability company
By ICON Capital Corp.
Its Manager
By: ________________________
Xxxxxx X. Xxxxxx
Executive Vice President
___________________________BANK
As Escrow Agent
By: _________________________
Name: ___________________
Title: __________________
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Schedule 1
$_________ per annum without proration for partial years.
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Schedule 2
Telephone Number(s) for Call-Backs and
Person(s) Designated to Confirm Funds Transfer Instructions
If to issuer-Company
Name Telephone Number
1. Beaufort X. X. Xxxxxx (000) 000-0000
2. Xxxxxx X. Xxxxxx (000) 000-0000
3. Xxxx X. Xxxxx (000) 000-0000
If to Depositor-Agent:
1.
2.
3.
Telephone call-backs shall be made to each of Issuer-Company and
Depositor-Agent if joint instructions are required pursuant to the Agreement,
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