EXHIBIT 10.3
ESCROW AGREEMENT
THIS ESCROW AGREEMENT made and entered into as of the __th day of ______,
2001, by and between West Metro Financial Services, Inc. (the "Company"), a
corporation organized under the laws of the State of Georgia, and First National
Bank of Polk County, a national bank (the "Escrow Agent").
WHEREAS, the Company intends to offer for sale a minimum of _____ shares
and a maximum of _____ of its common stock, _____ par value per share (the
"Shares"), at a price of $10.00 per share pursuant to the terms of the offering
circular dated _________________________ (the "Offering Circular") (such
offering is hereinafter referred to as the "Offering"); and
WHEREAS, the Company intends to enter into stock subscription agreement
substantially in the form attached hereto as Exhibit A (the "Subscription
Agreements") with prospective shareholders of the Company (the "Subscribers")
pursuant to which Subscribers would subscribe for Shares by paying the purchase
price thereof to the Escrow Agent; and
WHEREAS, under the terms of the Subscription Agreements and the Offering
Circular, the Escrow Agent will (i) release to the Company the funds paid to it
by the Subscribers to the Company, together with any interest earned thereon,
if, by ________ __, 2001 (unless extended by the Company), subscriptions and
payment in full for not less than a specified number of Shares have been
received and the Company has obtained all required regulatory approvals to
commence business (or has satisfied, or made adequate provision for satisfying,
any conditions to such approvals), or (ii) return all such funds, without
interest to the Subscribers is the above-reference conditions are not satisfied;
and
WHEREAS, the Escrow Agent is agreeable to serving as escrow agent upon the
terms and conditions stated herein;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, and for other good and valuable consideration, the undersigned
hereby agree as follows:
1. Agreement to Become Escrow Agent. Escrow Agent agrees to accept funds
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from the Subscribers on behalf of the Company and to hold said funds
until:
(a) receipt of written confirmation from the Company that the
Offering has been terminated prior to the satisfaction of all required
conditions to the release of the escrowed funds to the Company
("Notice of Termination");
(b) receipt of written confirmation from the Office of the
Comptroller of the Currency that the Company has failed to meet all of
the conditions required to commence business as a national bank, and
that preliminary approval of the Company's application has been
withdrawn ("Notice of Withdrawal");
(c) receipt of evidence satisfactory to the Escrow Agent that (i)
the Company has not received subscriptions and payment in full for at
least _____ Shares before the Offering expiration date (5:00p.m.,
__________ Georgia time, on ____________________, unless the Offering
is extended pursuant to the written instructions of the Company for
additional periods not exceeding an aggregate of _________ days (i.e.
until ____________________), or (ii) on or before _________________,
______, the Company has not obtained all required regulatory approvals
(or has not satisfied, or made adequate provisions for satisfying, any
conditions to such approvals); or
(d) receipt of (i) written confirmation from the Company that the
Company has received fully paid subscriptions for a minimum of _____
Shares, that the Offering has been completed and that the Company has
obtained all required regulatory approvals (or has satisfied, or made
adequate provisions for satisfying, any conditions to such approvals )
(the "Bank's Confirmation Letter").
2. Release of Escrow Funds to Subscribers. If the Escrow Agent receives a
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Notice of Termination,, Notice of Withdrawal or the evidence described
in paragraph 1(c) above, the Escrow Agent shall promptly refund to
each Subscriber, by bank check drawn on the escrow account, all
collected funds received from such Subscriber, with any interest
earned. Escrow Agent shall deliver all such refunds to each such
Subscriber by regular mail addressed to the business of home address
set forth on the Subscription Agreement between the Company and such
Subscriber.
3. Release of Escrow Funds to the Company. At such time as the Escrow
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Agent receives the Company's Confirmation Letter, Escrow Agent agrees
to release to the Company the amount of the subscription proceeds
relating to subscriptions or portions thereof accepted by the Company,
together with any interest and other earnings earned thereon.
4. Disputes Between Parties; Indemnification of Escrow Agent. In the
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event of a disagreement between Escrow Agent and the Company or the
organizers of the Company (hereinafter referred to as the
"Organizers") or in the event of a disagreement between the Company or
the Organizers and a Subscriber, the Escrow Agent may in its
discretion withhold action on its part until directed to proceed by
written agreement of the parties to end such dispute or by an order of
a court of competent jurisdiction; provided, however, that the Escrow
Agent may in its discretion deposit the subject matter of the dispute
with a court of competent jurisdiction. The Company and the Organizers
agree to indemnify the Escrow Agent and hold it harmless from and
against any costs and expenses incurred by Escrow Agent in connection
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with any dispute between the Company or the Organizers and Subscribers
or in connection with any dispute between Escrow Agent and a
Subscriber or actions taken by any third party involving Escrow Agent
or the monies deposited with Escrow Agent as aforesaid, including, but
not limited to reasonable attorneys' fees. Provided, however, the
Company shall not be liable to Escrow Agent as a result of successful
actions brought against Escrow Agent based on Escrow Agent's failure
to perform pursuant to the terms of this Agreement.
5. Liability of Escrow Agent. In performing any of its duties hereunder,
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Escrow Agent shall not incur any liability for damages, losses or
expenses except by its breach of this Agreement or by its negligence
or willful default, and it shall accordingly not incur any such
liabilities with respect to (a) any action taken or refrained from
being taken in good faith, either with or without advice of counsel,
with respect to any question relating to the duties or
responsibilities of Escrow Agent under this Agreement, or (b) any
action taken or refrained from being taken in reliance upon any
instrument, not only as to its due execution, validity, effectiveness
and/or its provisions, but also as to the truth and accuracy of any
information contained therein which Escrow Agent in good faith
believes to be genuine and to have been presented by the proper
person(s). Escrow Agent shall not be obligated or required
affirmatively to commence any action against the Company, any
Organizer, or any Subscriber or to defend any action that the Company,
any Organizer, a Subscriber or any other person might bring.
6. Removal of Escrow Agent. Escrow Agent agrees that the Company and the
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Organizers may remove it as escrow agent hereunder by mutual agreement
at any time upon thirty (30) days written notice to Escrow Agent, and
substitute an individual or a bank or a trust company therefor, in
which event Escrow Agent, upon receipt of written notice thereof,
shall account for and deliver to such substituted escrow agent all
funds and obligations held by it, less any amounts then due and unpaid
to it for fees and expenses as herein provided for, and Escrow Agent
shall thereafter be discharged from all liability hereunder.
7. Resignation of Escrow Agent. Escrow Agent may resign as escrow agent
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hereunder at any time upon thirty (30) days written notice to the
Company and the Subscribers. The Company shall select a successor
escrow agent. The Escrow Agent, upon receipt of written notice of
designation of a successor escrow agent, shall account for and deliver
to such successor escrow agent all funds and obligations held by it,
less nay amounts then due and unpaid to it for fees and expenses as
herein provided, and Escrow Agent shall thereafter be discharged from
all liability hereunder.
8. Investment of Escrow Funds and Interest and Earnings Thereon. Upon
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collection of each check by the Escrow Agent, the Escrow Agent shall
invest the funds in deposit accounts or certificates of deposit which
are fully insured by the Federal Deposit Insurance Corporation or
another agency of the United States government, federal funds, or such
other investments as the Escrow Agent and the Company shall agree. The
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Company shall provide the Escrow Agent with instructions from time to
time concerning in which of the specific investment instruments
described above the funds deposited on behalf of Subscribers shall be
invested, and the Escrow Agent shall adhere to such instructions.
Interest and other earnings (less fees incurred by the Escrow Agent)
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 the Escrow Agent's own banking policies. All interest and
other earnings on the escrowed subscription proceeds shall be
delivered to and retained by the Company as set forth in Section 2 or
Section 3 of this Escrow Agreement. In the event any check of a
Subscriber is returned for insufficient funds or other reason to the
Escrow Agent after deposit by Escrow Agent, Escrow Agent shall
promptly return the check to the Company to take whatever action as
the Company deems necessary.
9. Compensation of Escrow Agent; Liability of the Company and Organizers.
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The Company and the Organizers shall be jointly and severally
responsible for the compensation of the Escrow Agent for the services
provided hereunder. The Company and the Organizers agree to pay to the
Escrow Agent as fee at the rate of $ ____ per month per $1 million
managed. Such fee shall be calculated daily and shall be determined
based on funds actually received from Subscribers. In addition, a
$20.00 per check fee will be charged if the escrow account has to be
refunded to Subscribers pursuant to Section 2 of this Escrow
Agreement. All of these fees are payable upon the release of the
escrowed subscription proceeds, and the Escrow Agent is hereby
authorized to deduct such fees from the escrowed subscription proceeds
prior to any release thereof; provided, however, that the Escrow Agent
shall present an updated accounting of such fees to the Company for
approval at least 24 hours prior to deducting them from the escrow
subscription proceeds, and the Company shall consent to the total
amount of such fees, which consent shall not be unreasonably withheld.
10. Notices. Any notices or items to be delivered hereunder shall be
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deemed properly given or done if mailed by certified mail, postage
prepaid, to the parties at the following designated addresses:
If to the Company:
West Metro Financial Services, Inc.
J. Xxxxxxx Xxxxxx
President and Chief Executive Officer
P. O. Xxx 000
Xxxxxx, Xxxxxxx 00000
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If to the Escrow Agent:
Xxxxx Xxxxxx
President and Chief Executive Officer
First National Bank of Polk County
Xxxxxxxxx, Xxxxxxx 00000
11. Limitations of Duties. The Escrow Agent undertakes to perform only
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such duties as are expressly set forth herein and no implied duties or
obligations shall be read into this Agreement against the Escrow
Agent. The Company and the Organizers hereby acknowledge that the
status of Escrow Agent is that of agent only for the limited purposes
set forth, and hereby agree that in making the offering, there shall
be no representation or implication that the Escrow Agent, by serving
as escrow agent hereunder or otherwise, has investigated the
desirability or advisability of investment in the Shares or has
approved, endorsed or passed upon the merits of the investment, nor
shall the name of the Escrow Agent be used in any manner whatsoever in
connection with the offer or sale of the Shares other than by
acknowledgement that it has agreed to serve as Escrow Agent for the
limited purposes herein set forth.
12. Successors and Assigns. This Agreement shall inure to the benefit of,
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and be binding upon, the parties hereto and their respective
successors and assigns.
13. Governing Law; Severability. This Agreement shall be construed and
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enforced in accordance with the laws of Georgia. The provisions of
this Agreement are severable, and the invalidity of any one or more
provisions shall not be deemed to invalidate the remainder.
14. Entire Agreement. This Agreement constitutes the entire agreement
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between the parties hereto with respect to the transactions
contemplated herein with respect to the escrow funds and its
supersedes all prior discussions, understandings or agreements between
said parties.
15. Headings. The headings of the sections and paragraphs of this Escrow
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Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Escrow Agreement or to affect the construction
thereof.
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IN WITNESS WHEREOF, the undersigned have cause this Escrow Agreement to be
signed by their respective officers thereunto duly authorized as of this _____
day of __________.
COMPANY
WEST METRO FINANCIAL SERVICES, INC.
By:
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J. Xxxxxxx Xxxxxx
President and Chief Executive Officer
ESCROW AGENT
FIRST NATIONAL BANK OF POLK COUNTY
By:
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Xxxxx Xxxxxx
Chief Executive Officer
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