Exhibit 10.7
ESCROW AGREEMENT
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This ESCROW AGREEMENT (the "Agreement") is made and entered into as of
the ___ day of April, 1999, by and between, Village Bancorp, Inc., (formerly
Delta Bancorp, Inc.) a Delaware corporation located in Prospect Heights,
Illinois ("Company") and LaSalle National, a national banking association
located in Chicago, Illinois (the "Escrow Agent").
RECITALS
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A. WHEREAS, the Company is offering for sale to the general public
pursuant to the Securities and Exchange Commission Registration Statement and
the related prospectus (the "Offering") a minimum of 454,000 and a maximum of
554,000 shares of Common Stock, $0.01 par value per share, ("Common Stock") at
an initial offering price of $13.25 per share. The minimum investment will be
800 shares ($10,600). The minimum investment limitation may, but need not, be
waived by the Company in certain circumstances. The Company reserves the right
to reject, in its sole discretion, any subscription in its entirety or to
allocate to any subscriber a smaller number of shares than the number of shares
for which the investor subscribed; and
B. WHEREAS, individual subscribers shall deposit funds in payment of
subscriptions for the purchase of the shares of Common Stock, with the Escrow
Agent in accordance with the terms and conditions set forth herein the the
Subscription Agreement Form ("Subscription Agreement") to be executed by
subscribers;
NOW, THEREFORE, in consideration of the mutual promise contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, and intending to be legally bound, the parties
hereto agree as follows:
1. Funds received, as payment for properly submitted subscriptions
will be placed in an Escrow Account ("Escrow Account") with the Escrow Agent.
Subscriptions will not be accepted if not in the proper form or if not
accompanied by full payment for all shares for which subscription is made.
Payment for subscriptions must be in cash or by check, money order, bank draft
or wire transfer made payable to the order of "Village Bancorp, Inc.- Escrow
Account # 628133506."
In the event the Escrow Agent receives an incomplete Subscription
Agreement or is otherwise unable to determine the acceptability of any such
Subscription Agreement, the Escrow Agent shall deliver any such Subscription
Agreement to the Company to determine whether to accept or reject such
Subscription Agreement.
2. Escrow Agent will not accept subscriptions, unless received before
5:00 p.m., Central Time on the Closing Date, July 31, 1999. The Company, at its
sole discretion, may extend the Closing Date to October 31, 1999 for acceptance
of subscriptions. The Company shall be required to give written notice of such
extension to the Escrow Agent.
3. The Escrow Agent hereby agrees that it shall:
a) deposit on a daily basis any and all funds received in
accordance with the terms herein
b) upon request forward by facsimile transmittal, to the
Company, a copy of the Statement of Transactions detailing
the activity in the Escrow Account.
c) hold in the Escrow Account under the supervision of the
Corporate Trust Division any subscription funds delivered
to it;
d) invest subscription funds in (i) direct obligations of the
United States Government or any agency thereof, (ii)
repurchase agreements and money market accounts which are
fully secured by direct obligations of the United States
Government or any agency thereof, (iii) money market mutual
funds which are utilized by the Escrow Agent and which
invest primarily in direct obligations of the United States
Government, or (iv) the ABN AMRO Government Money Market
Fund as directed. In the event no direction is received all
funds shall be invested in the ABN AMRO Government Money
Market Fund;
e) distribute any subscriptions funds as provided in Paragraph
4 of this Agreement.
4. No funds will be released by the Escrow Agent until subscriptions
have been accepted for the minimum number of shares offered, 454,000 shares, by
the Closing Date, July 31, 1999, unless extended in the sole discretion of the
Company as specified in Paragraph 2 of this Agreement, or if the offering is
terminated by the Company.
Funds for all acceptable subscriptions, including any interest earned
on such deposits, will then be released per written instruction received from
the Company. Funds for all subscriptions not accepted or rejected by the Company
in whole or in part, will be returned to the subscribers, without interest,
within five (5) business days of said rejection.
In the event that the minimum number of shares are not subscribed to,
by the Closing Date or as extended thereof at the Company's discretion, all
funds collected to date by the Escrow Agent, will be returned to the
subscriber without interest and no shares will be issued. Funds will be mailed
to subscribers within five (5) business days of the date the offering is
terminated without the issuance of shares.
Any interest earned on subscriptions returned to subscribers shall be
paid to the Company to repay expenses incurred in the Offering.
5. The Company may terminate this Offering prior to the issuance of
any shares for any reason. The Company will give written notice of any such
termination to the Escrow Agent.
6. Upon occurrence of either event contemplated in Paragraph 4 hereof,
and the Escrow Agent's compliance with the terms hereof, the Escrow Agent shall
be relieved of all liabilities in connection with the subscription funds
distributed pursuant to such paragraph from and after the time of such
distribution.
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Upon occurrence of the events contemplated in Paragraph 4 hereof, the
Escrow Agent shall deliver all Subscription Agreements and related documents in
its possession to the Company.
7. Throughout the term of this Agreement, the Escrow Agent will be
entitled to reasonable administrative and service fees (the "Agent Fee"). For
the services contemplated herein, an Agent Fee not to exceed a maximum of
$500.00 acceptance fee and a one time administration fee of $4,000.00, has been
mutually agreed upon. The Agent Fee will be paid by the Company from the
proceeds of the offering including the interest earned on the deposited funds
prior to disbursement of such funds.
8. In the event the subscription funds are attached or levied under an
order of any court of competent jurisdiction or if the delivery of such funds is
stayed or enjoined by an order of any court of competent jurisdiction, or any
order or judgment is made or entered by any court of competent jurisdiction
affecting the subscription funds deposited under this Agreement, or any part
thereof, the Escrow Agent is hereby expressly directed to obey and comply with
all orders so entered or issued. So long as the Escrow Agent obeys or complies
with any such order it has received, it will not be liable to any of the parties
hereto or to any other person, firm, or corporation by reason of such
compliance, notwithstanding such order is subsequently reversed, modified,
annulled, set aside or vacated.
9. If the Escrow Agent becomes involved in litigation resulting from
this Escrow Account or this Agreement, other than litigation involving any
breach by the Escrow Agent of third Agreement or other standards or requirements
imposed by applicable law, the Escrow Agent will have the right to retain
counsel and will be entitled to reimbursement by the Company for any and all
reasonable costs, attorney's fees, charges, disbursements and expenses in
connection with such litigation.
10. The Escrow Agent reserves the right to resign at any time by
giving written notice of resignation, specifying the effective date thereof.
Within 30 days after receiving the aforesaid notice, the Company agrees to
appoint a successor Escrow Agent to which the Escrow Agent may distribute the
subscription funds then held hereunder, less the Escrow Agent's fees, costs and
expenses as set forth above. If a successor Escrow Agent has not accepted such
appointment by the end of the 30 day period, the Escrow Agent may apply to a
court of competent jurisdiction for the appointment of a successor Escrow Agent
and any attorney's fees that are incurred in connection with such a proceeding
will be paid by the Company.
11. 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 Escrow Agent or referred to in the escrow
instructions nor shall the Escrow Agent be obliged 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 in the exercise of its own best
judgement. Any act done or omitted by
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the Escrow Agent pursuant to the advice of its attorney 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 escrow, or the rights of any of the
parties hereto, the Escrow Agent shall have the right in its sole discretion,
without liability for interest or damages, to discontinue any or all future acts
on its part until such conflict is resolved to its satisfaction and/or to
commence or defend any action or proceedings for the determination of such
conflict.
The parties to this escrow agreement, jointly and severally, to
indemnify and hold the Escrow Agent harmless from and against all costs,
damages, judgements, 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 escrow, and to pay the Escrow Agent on
demand the amount of all such costs, damages, judgements, attorney 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 rights to reimburse itself therefor out of all of the rights,
titles, and interests of each said parties in all money, property and
instruments deposited hereunder.
12. Any document required to be signed by the Company pursuant to the
terms and provisions of this Agreement may be signed by either its President or
Secretary. The Escrow Agent may act in reliance upon any writing, instrument or
signature which it, in good faith, believes to be genuine, may assume the
validity and accuracy of any statement or assertion contained in such writing,
or instrument and may assume that any person purporting to give any writing,
notice, advice or instruction in connection with the provisions hereof has been
duly authorized to do so
13. The Escrow Agent represents and warrants that it is duly
authorized to perform its obligations as the Escrow Agent pursuant to this
Agreement and has agreed to act as Escrow Agent in the performance of the duties
set forth above in connection with the Escrow Account.
14. All notices and communications hereunder will be in writing and
will be deemed to be duly given on the date the same is deposited in the United
States mail Registered or Certified mail, return receipt requested, postage
prepaid or delivered by courier or facsimile addressed as follows:
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a) In case of the Company
Village Bancorp, Inc.
Attn: X. Xxxxxxxx
0000 X. Xxxx Xxxx
X.X. Xxx 000
Xxxxxxxx Xxxxxxx, Xxx. 00000
Phone # (000) 000-0000
Fax # (000) 000-0000
b) In case of the Escrow Agent
LaSalle National Bank
Corporate Trust Division
Room 1825
Attn: Xx. Xxxxxx X. Xxxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Phone # (000) 000-0000
Fax #(000) 000-0000
Any party may change the designated address by giving written notice
to the other party.
15. The rights created by this Agreement will inure to the benefit of
and the obligations created hereby will be binding on, respective successors and
assigns of each of the parties hereto.
16. This Agreement and Escrow Account created hereby will be construed
and enforced according to the laws of the State of Illinois without regard to
conflicts of law principals.
17. The Company hereby authorizes Escrow Agent to disburse funds from
the Escrow Account in accordance with the provisions of this Section. Any
disbursement hereunder directed by the Company shall (if otherwise permitted
under the terms of this Agreement) be made by Escrow Agent by issuing a check or
checks or by Fedwire transfer (provided a Wire Transfer Agreement has been
executed), as designated by an original in writing, signed and delivered by the
Company to the Escrow Agent. Such writing shall indicate, the escrow account
number and (i) in the case of check(s), the name of each payee and amount
payable to such payee and (ii) in the case of a Fedwire transfer, the name and
account number of the recipient, the name and ABA routing number of the
recipient's bank and the amount to be transferred to such recipient. In the case
of Fedwire transfer instructions, the Escrow Agent is expressly authorized to
rely on the account number and ABA routing numbers identified therein and may
process such instructions in reliance thereon. Escrow Agent is authorized to
conclusively rely on such written instructions as the authorized instructions of
the Company and on the accuracy of the content of such instructions, which are
the sole responsibility of the Company.
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18. This Agreement may be signed in counterpart which, taken
collectively, shall constitute one entire Agreement. In addition, this Agreement
may be signed by facsimile signature.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
Village Bancorp, Inc. LaSalle National Bank
By ____________________________________ By _________________________________
Xxxxxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxx
Xx. Vice President & Secretary Trust Officer
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