EXHIBIT 10.1
FORM OF
ESCROW AGREEMENT
ESCROW AGREEMENT
THIS AGREEMENT is made and entered into as of the ____day of __________,
1999, by and among INLAND RETAIL REAL ESTATE TRUST, INC., a Maryland corporation
(the "Company"), INLAND SECURITIES CORPORATION, an Illinois Corporation (the
"Dealer Manager"), and LASALLE NATIONAL BANK, N.A., CHICAGO, ILLINOIS (the
"Escrow Agent"). Unless otherwise defined herein, capitalized terms used herein
shall have the same meaning as in the Company's Registration Statement on Form
S-11.
1. The Company does hereby open this escrow and Escrow Agent's sole
concern and duties shall be as specifically set forth herein:
1.1 From time to time during the course of this escrow, in connection
with the Company's offering (the "Offering") of up to 50,000,000 shares of
Common Stock on a "best efforts" basis (the "Shares") (exclusive of Shares
offered and sold pursuant to the Company's Distribution Reinvestment
Program), Escrow Agent will receive from subscribers deposits to be held in
escrow in accordance with the terms hereof. All such funds received by
Escrow Agent shall be placed into an interest-bearing account entitled
"Inland Retail Real Estate Trust, Inc." (the "Escrow Account").
2. All deposits from each subscriber shall be accompanied by a
subscription agreement, stating among other things, subscriber name, current
address and investment amount.
3. Checks deposited in the Escrow Account from the various subscribers
shall be made payable to "LNB, Escrow Agent for IRRET."
4. All parties understand and are aware that all funds received during
the course of the escrow and deposited in the Escrow Account must clear the
normal banking channels prior to the release of any funds.
5. The Company understands that it is not entitled to any funds received
into escrow in the event of cancellation of the Offering and in such event,
deposits shall be returned to the subscribers.
6. Subscribers named in any subscription for Shares clearly understand
that this is an impound escrow between the Company, the Dealer Manager and the
Escrow Agent and that they are not a party to this escrow.
7. All documents, including any instrument necessary for the negotiation
or other transfer of escrow assets, deposited simultaneously with the execution
of this Agreement are approved by the Company, and the Escrow Agent shall not be
obligated to inquire as to the form, manner of execution or validity of these
documents or any document hereafter deposited pursuant to the provisions hereof,
nor shall the Escrow Agent be obligated to inquire as to the identity, authority
or rights of the persons executing the same. The Escrow Agent shall be
liable under this Agreement only for its failure to exercise due care in the
performance of its duties expressly set forth in this Agreement. The Escrow
Agent shall have a lien on all securities, monies and documents deposited in
this escrow by each subscriber to secure Escrow Agent's reasonable
compensation and expenses and for judgments, attorneys' fees and other
liabilities which the Escrow Agent may incur or sustain by reason of this
escrow, and the undersigned agrees to pay to Escrow Agent, upon demand,
amounts to satisfy all such liabilities, fees and expenses. In case of
conflicting demands upon it, the Escrow Agent may withhold performance of
this escrow until such time as the conflicting demands shall have been
withdrawn or the rights of the respective parties shall have been settled by
court adjudication, arbitration, joint order or otherwise.
8. Until the termination of the Offering, the Company shall notify the
Escrow Agent of the Company's acceptance or rejection of each subscription
agreement as promptly as practicable, but in any event within ten (10) days of
its receipt, and of any subscription which is rescinded within five (5) days of
such rescission. If a subscription is rejected by the Company, the subscriber's
check and subscription agreement will be returned by the Escrow Agent to the
subscriber, without interest or deduction, as promptly as practicable, but in
any event within ten (10) days after receipt. If a subscription is rescinded,
the Escrow Agent shall return to the subscriber the subscriber's check (or an
equal amount of funds) and subscription agreement, without interest or
deduction, within seven (7) days of being notified by the Company of such
rescission. In the event the check of a subscriber whose subscription has been
rescinded has been negotiated (and if the funds represented thereby have been
disbursed to the Company), the Company shall deposit with the Escrow Agent an
amount of funds equal to the amount necessary to be returned to the subscriber
(or the Escrow Agent may deduct such amount from any funds due to the Company
under this Agreement), along with the subscriber's subscription agreement. The
Escrow Agent shall not be liable for the failure to return a rejected or
rescinded subscription if the Company fails to notify the Escrow Agent of such
rejection of rescission.
9. Commencing with the date paid subscriptions have been received and
accepted for at least 20,000 Shares or $2,000,000 (the "Minimum Offering"),
provided such date is within six months of the initial date of the Company's
Prospectus (such initial date of the Company's Prospectus being the
"Effective Date"), and ending on the Termination Date (the "Offering
Period"), the Escrow Agent shall (i) disburse to the Company on a weekly
basis any funds received by the Escrow Agent for accepted subscriptions (but
not those funds of a subscriber whose subscription has been rejected or
rescinded of which the Escrow Agent has been notified by the Company or those
funds of a Pennsylvania resident until subscriptions have been received and
accepted for at least $25,000,000), or otherwise in accordance with the
Company's written request (including possible refunds to Pennsylvania
residents); and (ii) invest any funds held in the escrow subject to paragraph
10 hereof, in such instruments as the Company may direct. Upon termination of
the Offering, which shall occur not later than 12 months after the Effective
Date, provided however that, subject to requalification in certain states,
the Company may extend the Offering Period from time to time, but in no event
more than two years after the Effective Date (the "Termination Date"), all
amounts theretofore undistributed shall be distributed to the Company, and
this escrow shall close and be consummated in its entirety. If subscriptions
for at least the Minimum Offering have not been received, accepted, and paid
for within six months of the Effective Date, funds received will be promptly
refunded in full to subscribers, together with their pro rata share of any
interest earned thereon. If such refund is made Inland Real Estate Investment
Corporation will pay any escrow fees.
10. The funds deposited herein shall be invested in federally insured bank
accounts (E.G., savings accounts), short-term certificates of deposit issued by
a bank, short-term
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securities issued or guaranteed by the United States government and any other
investments permitted under Rule 15c2-4 of the Securities Exchange Act of
1934, as amended, at the direction of the Company. The interest on such
investments shall, on a monthly basis while subscribers' deposits remain in
escrow and, if all conditions herein are met, when such deposits are
disbursed to the Company, be disbursed by the Escrow Agent to the Company in
accordance with paragraph 9 hereof.
11. The Company agrees to disburse to the Dealer Manager any funds due to
it for the Offering in accordance with the terms and conditions of the Dealer
Manager Agreement dated _________________, 1999 between the Company and the
Dealer Manager, provided that the Escrow Agent has disbursed to the Company the
funds due to the Company for the related subscriptions. The Dealer Manager
shall assist the Company in connection with the Company's compliance with this
Agreement. The Dealer Manager shall not have any lien on or security interest
in any securities, monies or documents deposited in this escrow.
12. Any notices which are required or desired to be given hereunder to the
parties hereto shall be in writing and may be given by mailing the same to the
address indicated below (or to such other address as either of the parties may
have theretofore substituted therefor by written notification to the other party
hereto), by registered or certified United States mail, postage prepaid. For all
purposes hereof, any notice so mailed by the Escrow Agent shall be treated as
though served upon the party to whom it was mailed at the time it is deposited
in the United States mail by the Escrow Agent whether or not such party
thereafter actually receives such notice. Notices to the Escrow Agent shall be
in writing and shall not be deemed to be given until actually received by the
Escrow Agent's trust department. Whenever under the terms hereof the time for
giving a notice or performing an act falls upon a Saturday, Sunday or bank
holiday, such time shall be extended to the Escrow Agent's next business day.
13. The Escrow Agent, when acting as the Escrow Agent undertakes to
perform only such duties as are expressly set forth herein and the Escrow Agent
shall not be subject to, nor obliged to recognize, any other agreement between,
or direction or instruction of, the Company even though reference thereto may be
made herein; provided, however, this Agreement may be amended at any time or
times by an instrument in writing signed by the Company, the Dealer Manager and
Escrow Agent. In the event the Escrow Agent becomes involved in or is threatened
with litigation by reason hereof, it is hereby authorized to and may deposit
with the clerk of a court of competent jurisdiction any and all funds held by it
pursuant hereto, and thereupon the Escrow Agent shall stand fully relieved and
discharged of any further duties hereunder.
14. If any property subject hereto is at any time attached, garnished
or levied upon, under any court order, or in case the payment, assignment,
transfer, conveyance or delivery of any such property shall be stayed or
enjoined by any court order, or in any case any order, judgment or decree
shall be made or entered by any court affecting such property, or any part
thereof, then in any of such events, the Escrow Agent is authorized, in its
sole discretion, to rely upon and comply with any such order, writ, judgment
or decree, which it is advised by legal counsel of its own choosing is
binding upon it, and if it complies with any such order,
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writ, judgment or decree, it shall not be liable to any of the parties hereto
or to any other person, firm or corporation by reason of such compliance,
even though such order, writ, judgment or decree may be subsequently
reversed, modified, annulled, set aside or vacated.
15. This Agreement shall be construed, enforced and administered in
accordance with the internal laws, as opposed to the conflicts of laws
provisions, of the State of Illinois.
16. The Escrow Agent shall be entitled to reasonable fees in connection
with this Escrow, which fees shall be payable by the Company.
17. The Escrow Agent may resign by giving five days written notice by
registered or first class mail sent to the undersigned at its address herein set
forth; and, thereafter, shall deliver all remaining deposits in said escrow upon
the written and signed order of the undersigned. If no such notice is received
by the Escrow Agent within 30 days after mailing such notice it is
unconditionally and irrevocably authorized and empowered to send any and all
items deposited hereunder by registered mail to the respective depositors
thereof or, at its sole option, to deliver such deposited items to the
respective depositors.
18. Any notice required to be given hereunder by any of the parties hereto
shall be addressed as follows:
If to the Company:
Inland Retail Real Estate Trust, Inc.
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxxx, Vice President
If to the Dealer Manager:
Inland Securities Corporation
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxx, President
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If to Escrow Agent:
LaSalle National Bank, N.A
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Department
19. The foregoing is subject to the following conditions:
The obligations and duties of the Escrow Agent are confined to those
specifically enumerated in the escrow instructions. The Escrow Agent shall
not be subject to, nor be under any obligation to ascertain or construe the
terms and conditions of any other instrument, whether or not now or hereafter
deposited with or delivered to the Escrow Agent or referred to in the escrow
instructions, nor shall the Escrow Agent be obligated to inquire as to the
form, execution, sufficiency, or validity of any such instrument nor to
inquire as to the identity, authority, or rights of the person or persons
executing or delivering the same.
The Escrow Agent shall not be personally liable for any act which it may do or
omit to do hereunder in good faith and in the exercise of its own best
judgment. Any act done or omitted by the Escrow Agent pursuant to the advice of
its attorneys shall be deemed conclusively to have been performed or omitted
in good faith by the Escrow Agent.
If the Escrow Agent should receive or become aware of any conflicting demands
or claims with respect to this Agreement, or the rights of any of the parties
hereto, or any money, property, or instruments deposited herein or affected
hereby, the Escrow Agent shall have the right in its sole discretion, without
liability for interest or damages, to discontinue any or all further acts on
its part until such conflict is resolved to its satisfaction and/or to
commence or defend any action or proceeding for the determination of such
conflict.
The parties to this Agreement agree, jointly and severally, to indemnify and
hold the Escrow Agent harmless from and against all costs, damages,
judgments, attorney's fees (whether such attorneys shall be regularly
retained or specially employed), expenses, obligations and liabilities of
every kind and nature which the Escrow Agent may incur, sustain, or be
required to pay in connection with or arising out of this Agreement, and to
pay the Escrow Agent on demand the amount of all such costs, damages,
judgments, attorney's fees, expenses, obligations, and liabilities. To secure
said indemnification and to satisfy its compensation hereunder, the Escrow
Agent is hereby given a first lien upon and the right to reimburse itself
therefor out of, all of the rights, titles, and interests of each of said
parties in all money, property, and instruments deposited hereunder, except
for any money, property or instruments that relate to money received that
must be returned pursuant to the provisions of the second to last sentence of
paragraph 9.
* * *
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
INLAND RETAIL REAL ESTATE TRUST, INC.
By:
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Title:
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INLAND SECURITIES CORPORATION
By:
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Title:
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LASALLE NATIONAL BANK, N.A.
CHICAGO, IL
By:
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Title:
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