EXHIBIT 10.2
FORM OF
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of ______ 1999, (the "Agreement")
by and among First Star Bancorp, Inc., a Pennsylvania corporation (the
"Company"), First Star Capital Trust, a Delaware business trust (the "Trust"),
Xxxxxx Xxxxxxx, a Division of Xxxxxx-Xxxxxxx Incorporated (the "Placement
Agent") and Bankers Trust Company, a New York banking corporation (as escrow
agent hereunder, the "Escrow Agent").
W I T N E S S E T H :
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WHEREAS, the Trust proposes to offer for sale through the
Placement Agent up to 1,200,000 Adjustable Rate Trust Preferred Securities of
the Trust (the "Preferred Securities") at a price of $10.00 per Preferred
Security, for an aggregate offering price of $12,000,000 (the "Offering"); and
WHEREAS, the Placement Agent intends to sell the Preferred
Securities as the Trust's agent on a best-efforts basis for 1,200,000 Preferred
Securities.
WHEREAS, the Trust and the Placement Agent desire to establish
an interest-paying escrow account in which funds received from subscribers will
be deposited pending completion of the escrow period; and
WHEREAS, the Escrow Agent is willing to act as escrow agent in
respect of the Escrow Fund (as hereinafter defined) upon the terms and
conditions hereinafter set forth;
NOW, THEREFORE, for good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged by each of the parties
hereto, the parties hereto, intending to be legally bound, do hereby agree as
follows:
1. Appointment of Escrow Agent. The Company, the Trust and the
Placement Agent hereby appoint Bankers Trust Company as escrow agent in
accordance with the terms and conditions set forth herein, and the Escrow Agent
hereby accepts such appointment.
2. Establishment of Escrow Account. On or prior to the date of
the commencement of the Offering, the parties shall establish an account with
the Escrow Agent, which escrow account shall be titled the First Star Capital
Trust Escorw Account (the "Escrow Account"). The Placement Agent will instruct
subscirbers to make checks for subscriptions payable to First Star Capital
Trust, c/o the Placement Agent. Wire transfers will be directed to the Escrow
Agent as follows:
ABA #
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for further credit to
Bankers Trust Company
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for further credit to
Bankers Trust Company Corporate Trust and Agency Services
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Reference: First Star Capital Trust Escrow Account
3. Escrow Period. The escrow period (the "Escrow Period")
shall begin with the commencement of the Offering and shall terminate upon the
earlier to occur of the following dates:
A. The date selected by the Company to terminate the
Escrow Period and to have the Trust issue the
Preferred Securities pursuant to accepted
subscriptions, which date shall be set forth in a
written notice to the Escrow Agent from the Placement
Agent as set forth in Exhibit A attached hereto,
signed by an authorized person of the Placement
Agency, as set forth on Exhibit B attached hereto; or
B. The date upon which a determination is made by the
Trust and the Placement Agent to terminate the
offering prior to the issuance of any Preferred
Securities, which date shall be set forth in a
written notice to the Escrow Agent from the Placement
Agent.
During the Escrow Period, the Trust is aware and understands
that it is not entitled to any funds received into escrow and no amounts
deposited in the Escrow Account shall become the property of the Trust or any
other entity, or be subject to the debts of the Trust or any other entity.
4. Deposits into the Escrow Account. The Placement Agent
agrees that it shall promptly deliver all monies received from subscribers for
the payment of the Preferred Securities to the Escrow Agent for deposit to the
Escrow Account, together with a written account of each accepted subscription,
which account shall set forth, among other things, the subscriber's name and
address, tax identification number, the number of Preferred Securities
purchased, the amount paid therefor, and whether the consideration received was
in the form of a check, wire (to the Escrow Agent), draft or money order. All
monies so deposited in the Escrow Account are hereinafter referred to as the
"Escrow Amount."
5. Disbursements from the Escrow Account.
(a) In the event the Escrow Period is terminated pursuant to
clause (B) of Section 2 prior to issuance of any Preferred Securities, the
Escrow Agent shall refund to each subscriber the amount received from the
subscriber, together with any earnings generated thereon, and shall notify the
Trust and the Placement Agent of its distribution of the funds.
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The purchase money returned to each subscriber shall be free and clear of any
and all claims of the Trust or any of its creditors.
(b) In the event the Escrow Agent receives notification
pursuant to clause (A) of Section 2 of the date upon which the Escrow Period is
to terminate and to have the Trust issue the Preferred Securities, the Escrow
Agent shall pay over and remit to the Trust an amount equal to the aggregate
amount deposited by subscribers, provided, however, that in no event will funds
be released to the Trust until such amount is received by the Escrow Agent in
collected funds; and Escrow Agent shall pay over and remit to the Company any
earnings generated on escrowed funds that is not required to be returned to
subscribers.
(c) Any earnings generated on escrowed funds to be returned to
subscribers will be distributed to the subscribers on a pro-rata basis according
to the respective number of days between the time of collection of their
payments to the Escrow Account and the return of such payments to subscribers.
Earnings on any other funds returned to subscribers from the Escrow Account
shall be handled similarly.
For purposes of this Agreement, the term "collected funds"
shall mean all funds received by the Escrow Agent which have cleared normal
banking channels and are in the form of cash.
6. Collection Procedure. The Escrow Agent is hereby authorized
to forward each check for collection and, upon collection of the proceeds of
each check, deposit the collected proceeds in the Escrow Account.
Any check returned unpaid to the Escrow Agent shall be
returned to the Placement Agent. In such cases, the Escrow Agent will promptly
notify the Trust of such return.
If the Company or the Trust rejects any subscription for which
the Escrow Agent has already collected funds, the Escrow Agent shall promptly
issue a refund check to the rejected subscriber. If the Company or the Trust
rejects any subscription for which the Escrow Agent has not yet collected funds
but has submitted the subscriber's check for collection, the Escrow Agent shall
promptly issue a check in the amount of the subscriber's check to the rejected
subscriber after the Escrow Agent has cleared the funds. If the Escrow Agent has
not yet submitted a rejected subscriber's check for collection, the Escrow Agent
shall promptly remit the subscriber's check directly to the subscriber.
7. Investment of Escrow Amount. The Escrow Agent may invest
the Escrow Amount only in such accounts or investments as the Placement Agent
may specify by written notice. The Placement Agent may only specify investment
in (1) money-market accounts, (2) short-term certificates of deposit issued by a
bank, or (3) short-term securities issued or guaranteed by the U.S. Government.
8. Resignation of Escrow Agent. The Escrow Agent may resign
and be discharged from its duties hereunder at any time by giving written notice
of such
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resignation to the Company, the Trust and the Placement Agent specifying a date
when such resignation shall take effect and upon delivery of the Escrow Fund to
the successor escrow agent designated by all parties hereto (other than the
Escrow Agent) in writing. Upon such notice, a successor Escrow Agent shall be
appointed with the mutual consent of the Company, the Trust and the Placement
Agent. Such successor Escrow Agent shall become the Escrow Agent hereunder upon
the resignation date specified in such notice. If the Company, the Trust and the
Placement Agent are unable to agree upon a successor Escrow Agent within thirty
(30) days after such notice, the Escrow Agent shall be entitled to apply to a
court of competent jurisdiction for the appointment of a successor. The Escrow
Agent shall continue to serve until its successor accepts the escrow and
receives the Escrow Fund. The Company, the Trust and the Placement Agent shall
have the right at any time upon their mutual consent to substitute a new Escrow
Agent by giving notice thereof to the Escrow Agent then acting. Upon its
resignation and delivery of the Escrow Fund as set forth in this Section 6, the
Escrow Agent shall be discharged of and from any and all further obligations
arising in connection with the escrow contemplated by this Agreement.
9. Indemnification of Escrow Agent. (a) The Escrow Agent shall
have no duties or responsibilities whatsoever with respect to the Escrow Fund
except as are specifically set forth herein. The Escrow Agent shall neither be
responsible for or under, nor chargeable with knowledge of the terms and
conditions of, any other agreement, instrument or document in connection
herewith. The Escrow Agent may conclusively rely upon, and shall be fully
protected from all liability, loss, cost, damage or expense in acting or
omitting to act pursuant to any written notice, instrument, request, consent,
certificate, document, letter, telegram, opinion, order, resolution or other
writing hereunder without being required to determine the authenticity of such
document, the correctness of any fact stated therein, the propriety of the
service thereof or the capacity, identity or authority of any party purporting
to sign or deliver such document. The Escrow Agent shall have no responsibility
for the contents of any such writing contemplated herein and may rely without
any liability upon the contents thereof.
(b) The Escrow Agent shall not be liable for any action taken
or omitted by it in good faith and reasonably believed by it to be authorized
hereby or with the rights or powers conferred upon it hereunder, nor for action
taken or omitted by it in good faith, and in accordance with advice of counsel
(which counsel may be of the Escrow Agent's own choosing), and shall not be
liable for any mistake of fact or error of judgment or for any acts or omissions
of any kind except for its own willful misconduct or gross negligence.
(c) Each of the Company the Trust and the Placement Agent
agrees to jointly and severally indemnify the Escrow Agent and its employees,
directors, officers and agents and hold each harmless against any and all
liabilities incurred by it hereunder as a consequence of such party's action,
and the parties agree jointly and severally to indemnify the Escrow Agent and
hold it harmless against any claims, costs, payments, and expenses (including
the fees and expenses of counsel) and all liabilities incurred by it in
connection with the performance of its duties hereunder and them hereunder,
except in
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either case for claims, costs, payments, and expenses (including the fees and
expenses of counsel) and liabilities incurred by the Escrow Agent resulting from
its own willful misconduct or gross negligence. The Company, the Trust and the
Placement Agent agree to reimburse each other for one-half of any payments made
by them pursuant to this Section 7(c) with respect to liabilities for which the
parties are jointly liable pursuant to this Section 7(c). The provisions of this
Section 7 shall survive the termiantion of the Agreement or resignation or
removal of the Escrow Agent.
10. Compensation of Escrow Agent. The Escrow Agent shall be
entitled to payment from the Company for customary fees and expenses for all
services rendered by it hereunder in accordance with Schedule A attached hereto
(as such schedule may be amended from time to time). The Escrow Agent shall also
be entitled to reimbursement on demand for all loss, liability, damage or
expenses paid or incurred by it in the administration of its duties hereunder,
including, but not limited to, all counsel, advisors' and agents' fees and
disbursements and all taxes or other governmental charges. At all times, the
Escrow Agent will have a right of set off and first lien on funds in the Escrow
Fund for payment of customary fees and expenses and all such reasonable loss,
liability, damage or expenses. Such compensation and expenses shall be paid from
the Escrow Fund.
11. Further Assurances. From time to time on and after the
date hereof, the other parties hereto shall deliver or cause to be delivered to
the Escrow Agent such further documents and instruments and shall do and cause
to be done such further acts as the Escrow Agent shall reasonably request (it
being understood that the Escrow Agent shall have no obligation to make any such
request) to carry out more effectively the provisions and purposes of this
Agreement, to evidence compliance herewith or to assure itself that it is
protected in acting hereunder.
12. Termination of Agreement. This Agreement shall terminate
on the final disposition of the Escrow Fund provided that the rights of the
Escrow Agent and the obligations of the other parties hereto under Sections 8
and 9 shall survive the termination hereof and the resignation or removal of the
Escrow Agent.
13. Consents to Service Process. Each of the parties hereto
hereby irrevocably consents to the jurisdiction of the courts of the State of
New York and of any Federal Court located in the Borough of Manhattan in such
State in connection with any action, suit or other proceeding arising out of or
relating to this Agreement or any action taken or omitted hereunder, and waives
any claim of forum non conveniens and any objections as to laying of venue. Each
party further waives personal service of any summons, complaint or other process
and agree that the service thereof may be made by certified or registered mail
directed to such person at such person's address for purposes of notices
hereunder.
14. Tax Withholding & Reporting. (a) On or prior to the date
of this Agreement, the Company, the Trust and the Placement Agent for purposes
of United States backup withholding tax and information reporting requirements,
will provide the
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Escrow Agent with an executed copy of Internal Revenue Service form W-9 (for
United State persons) or form W-8 (for non-United States persons) or any
successor forms. The Company, the Trust and the Placement Agent agree to provide
replacement forms if originals of any form previously provided become obsolete
or incomplete.
(b) It is understood that the Escrow Agent shall be
responsible for income reporting only with respect to income earned through
dividend payments of the Escrow Shares and is not responsible for any other
reporting.
15. Miscellaneous. (a) This Agreement embodies the entire
agreement and understanding among the parties relating to the subject matter
hereof except, as to the Company, the Trust and the Placement Agent, the Agency
Agreement, and may not be changed orally, but only by an instrument in writing
signed by the parties hereto.
(b) All notices and other communications under this Agreement
shall be in writing and shall be deemed given when delivered personally, on the
next Business Day after delivery to a recognized overnight courier or mailed
first class (postage prepaid)or when sent by facsimile to the parties (which
facsimile copy shall be followed, in the case of notices or other communications
sent to the Escrow Agent, by delivery of the original) at the following
addresses (or to such other address as a party may have specified by notice
given to the other parties pursuant to this provision):
If to the Company or to the Trust, to:
First Star Bancorp, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, President and Chief Executive Officer
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxxx Spidi & Xxxxx, PC
0000 X Xxxxxx, X.X. Xxxxx 000 Xxxx
Xxxxxxxxxx, X.X. 00000
Attn: Xxxx X. Spidi, Esq.
Telecopy No.: (000) 000-0000
If to the Placement Agent, to:
Xxxxxx Xxxxxxx, a division of Xxxxxx-Xxxxxxx Incorporated
0000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000
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Attn: Xxxx X. Xxxxxxx, Senior Vice President
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxxx & Xxx, PC
One Glenhardie Corporate Center
0000 Xxxxxxxx Xxxx
Xxxxx, Xxxxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Telecopy No.: (000) 000-0000
If to the Escrow Agent, to:
Bankers Trust Company
Corporate Trust and Agency Services
Four Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Escrow Services
Telecopy No.: (000) 000-0000/6392
(c) The headings of the Sections of this Agreement have been
inserted for convenience and shall not modify, define, limit or expand the
express provisions of this Agreement.
(d) This Agreement and the rights and obligations hereunder of
parties hereto may not be assigned except with the prior written consent of the
other parties hereto. This Agreement shall be binding upon and inure to the
benefit of each party's respective successors and permitted assigns. Except as
expressly provided herein, no other person shall acquire or have any rights
under or by virtue of this Agreement. This Agreement is intended to be for the
sole benefit of the parties hereto, and (subject to the provisions of this
Section 14(d)) their respective successors and assigns, and none of the
provisions of this Agreement are intended to be, nor shall they be construed to
be, for the benefit of any third person.
(e) This Agreement may not be amended, supplemented or
otherwise modified without the prior written consent of the parties hereto.
(f) The Escrow Agent makes no representation as to the
validity, value, genuineness or the collectability of any security or other
document or instrument held by or delivered to it.
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(g) The Escrow Agent shall not be called upon to advise any
party as to the wisdom in selling or retaining or taking or refraining from any
action with respect to any securities or other property deposited hereunder.
(h) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without reference to the
principles of conflict of laws.
(i) This Agreement may be executed in two or more
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
FIRST STAR BANCORP, INC.
By
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Name:
Title:
FIRST STAR CAPITAL TRUST
By
----------------------------------------
Name:
Title:
XXXXXX XXXXXXX,
a Division of Xxxxxx Xxxxxxx Incorporated
As Placement Agent
By
----------------------------------------
Name:
Title:
BANKERS TRUST COMPANY,
as Escrow Agent
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By
----------------------------------------
Name:
Title:
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Schedule A
Schedule of Fees
Prepared For
Escrow Agreement
A. Acceptance Fee: one time
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(Includes acceptance of appointment, review of documentation, establishment
of account and records. This fee is intended to cover costs and set up of a
standard escrow agreement. Any escrow that substantially alters the
agreement may incur additional costs which would be billed as an acceptance
fee.)
B. Annual Administrative Fee:
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(Payable annually in advance. Includes normal administrative duties as
stipulated in the agreement.
C. Investment Transactions
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(Covers all costs associated with investing in eligible investments at the
direction of the client, including ticket charges, custody and tax
reporting.)
D. Wire Transfer Fee
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(Pertains to outgoing wires only.)
Note: The fees set forth in this schedule are subject to review of
documentation. The fees are also subject to change should circumstances warrant.
Out-of-pocket expenses and disbursements, including counsel fees, incurred in
the performance of our duties will be added to the billed fees. Fees for any
services not covered in this or related schedules will be based upon our
appraisal of the services rendered.
We may place orders to buy/sell financial instruments with outside
broker-dealers that we select, as well as with BT or its affiliates. These
transactions(for which normal and customary spreads or other compensation may be
earned by such broker-dealers, including BT or its affiliates, in addition to
the charges quoted above) will be executed on a riskless principal basis solely
for your account(s) and without recourse to us or our affiliates. If you choose
to invest in any mutual fund, BT and/or our affiliates may earn investment
management fees and other service fees/expenses associated with these funds as
disclosed in the mutual fund prospectus provided to you, in addition to the
charges quoted above. Likewise, BT has entered into agreements with certain
mutual funds or their agents to provide shareholder services to those funds. For
providing these shareholder services, BT is paid a fee by these mutual funds
that calculated on an annual basis does not exceed 25 basis points of the amount
of your investment in these mutual funds. In addition, if you choose to use
other services provided by BT or its affiliates, Corporate Trust or other BT
affiliates may be allocated a portion of the fees earned. We will provide
periodic account statements describing transactions executed for your
account(s). Trade confirms will be available upon your request at no additional
charge. If a transaction should fail to close for reasons beyond our control, we
reserve the right to charge our acceptance fee plus reimbursement for legal fees
incurred.
Shares of mutual funds are not deposits or obligations of, or
guaranteed by, Bankers Trust Company or any of its affiliates and are not
insured by the Federal Deposit Insurance Corporation or any other agency of the
U.S. Government. Investments in the mutual funds involve the possible loss of
principal. Please read the prospectus carefully before investing.
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Exhibit A
Release Notice
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Exhibit B
Authorized Person(s) to Execute Exhibit(s) A
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