Unassociated Document


     

    FORM OF ESCROW
AGREEMENT

    


    THIS ESCROW AGREEMENT (this
“Agreement”)
made and entered into as of this             
day of ________, 2009 by and among Empire American Realty, LLC, a Delaware
limited liability company (the “Dealer Manager”),
Empire American Realty Trust, Inc., a Maryland corporation (the “Company”), and UMB
Bank, N.A., as escrow agent, a national banking association organized and
existing under the laws of the United States of America (the “Escrow
Agent”).

    


    RECITALS

     

    WHEREAS, the Company proposes
to offer and sell shares of common stock (“Shares”), on a
best-efforts basis, for a minimum amount equal to at least $2.5 million (the
“Minimum
Offering”) and a maximum amount equal up to $1 billion of gross offering
proceeds (excluding any Shares offered and sold pursuant to the Company’s
distribution reinvestment program), at an initial purchase price of $10.00 per
share, subject to certain discounts (the “Offering”) to
investors pursuant to the Company’s Registration Statement on Form S-11
(Registration No. 333-160093), as amended or supplemented from time to time (the
“Offering
Document”).

    


    WHEREAS, the Dealer Manager
has been engaged by the Company to offer and sell the Shares on a best efforts
basis through a network of participating broker-dealers (the “Dealers”).

     

    WHEREAS, the Company has
agreed that the subscription price paid by subscribers for Shares will be
refunded to such subscribers if at least $2.5 million of gross offering proceeds
has not been raised within two years from the date the Offering Document becomes
effective with the Securities and Exchange Commission, subject to extension in
certain states (the “Termination
Date”).

     

    WHEREAS, the Dealer Manager
and the Company desire to establish an escrow account (the “Escrow Account”) as
further described herein, in which funds received from subscribers will be
deposited, and the Company desires that UMB Bank, N.A. act as escrow agent to
the Escrow Account and Escrow Agent is willing to act in such
capacity.

     

    WHEREAS, funds received from
residents of the State of Pennsylvania (the “Pennsylvania
Subscribers”) and funds received from residents of the State of Tennessee
(the “Tennessee
Subscribers”) will remain in the Escrow Account until the conditions of
Sections 3
and 4,
respectively, have been satisfied.

     

    WHEREAS, the Escrow Agent has
engaged DST Systems, Inc. (the “Processing Agent”) to
receive, examine for “good order” and facilitate subscriptions into the Escrow
Account as further described herein and to act as record keeper, maintaining on
behalf of the Escrow Agent the ownership records for the Escrow Account. In so
acting, the Processing Agent shall be acting solely in the capacity of agent for
the Escrow Agent and not in any capacity on behalf of the Company or the Dealer
Manager, nor shall the Processing Agent have any interest other than that
provided in this Agreement in assets in Processing Agent’s possession as the
agent of the Escrow Agent.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    WHEREAS, in order to subscribe
for Shares during the Escrow Period (as defined below), a subscriber must
deliver the full amount of its subscription: (i) by check, draft or money
order made payable to the order of “UMB Bank, N.A., as Escrow Agent for Empire
REIT,” in U.S. dollars or (ii) by draft, wire transfer of immediately
available funds or Automated ClearingHouse (ACH) in U.S. dollars.

     

    AGREEMENT

     

    NOW,
THEREFORE, the Dealer Manager, the Company and Escrow Agent agree to the terms
of this Agreement as follows:


     

    1. Establishment of Escrow
Account; Escrow Period. The Company hereby appoints the Escrow Agent for
purposes of holding the proceeds from subscriptions for Shares on the terms and
conditions set forth herein.  On or prior to the commencement of the
offering of Shares pursuant to the Offering Document, the Company shall
establish the Escrow Account with the Escrow Agent, which shall be entitled “UMB
Bank, N.A., as Escrow Agent for Empire REIT.”  This Agreement shall be
effective on the date on which the Offering Document becomes effective. Except
as otherwise set forth herein with respect to the Pennsylvania Subscribers and
the Tennessee Subscribers, the escrow period shall commence upon the
effectiveness of this Agreement and shall continue until the earlier of
(i) the date upon which the Escrow Agent receives confirmation from the
Company that the Company has raised the Pennsylvania Minimum (as defined below),
(ii) the Termination Date, or (iii) the termination of the Offering by
the Company prior to the receipt of the Minimum Offering (the “Escrow
Period”).

     

    2. Operation of the
Escrow.

     

    (a) Deposits in the Escrow
Account. During the Escrow Period, persons subscribing to purchase Shares
will be instructed to make checks for subscriptions payable to the order of “UMB
Bank, N.A., as Escrow Agent for Empire REIT.” Completed subscription agreements
and checks or money orders in payment for the purchase price shall be remitted
to the address designated for the receipt of such agreements and funds, and
drafts, wires, or Automated ClearingHouse (ACH) payments shall be transmitted
directly to the Escrow Account. To the extent that subscription agreements and
payments are remitted by the Processing Agent, the Company or the Dealer
Manager, the Processing Agent, the Company or the Dealer Manager, as applicable,
will furnish to the Escrow Agent a list detailing information regarding such
subscriptions as set forth in Exhibit B . The
Processing Agent will promptly deliver all monies received in good order from
subscribers (or from the Company, the Dealer Manager or Dealers transmitting
monies and subscriptions from subscribers) for the payment of
Shares to the Escrow Agent for deposit in the Escrow Account. Deposits shall be
held in the Escrow Account until such funds are disbursed in accordance with
Section 2,
3, or 4, as
applicable.  Prior to disbursement of the funds deposited in the
Escrow Account, such funds shall not be subject to claims by creditors of the
Company or any of its affiliates. If any of the instruments of payment are
returned to the Escrow Agent for nonpayment prior to receipt of the Break Escrow
Certificate (as defined below), the Escrow Agent shall promptly notify the
Processing Agent and the Company in writing via mail, email or facsimile of such
nonpayment, and the Escrow Agent is authorized to debit the Escrow Account, as
applicable, in the amount of such returned payment as well as any interest
earned on the amount of such payment and the Processing Agent shall delete the
appropriate account from the records maintained by the Processing Agent. The
Processing Agent will maintain a written account of each sale, which account
shall set forth, among other things, the following information: (i) the
subscriber’s name and address, (ii) the number of Shares purchased by such
subscriber, and (iii) the amount paid by such subscriber for such Shares.
During the Escrow Period, neither the Company nor the Dealer Manager will be
entitled to any funds received into the Escrow Account.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    (b) Distribution of the Escrowed
Funds. If at any time on or prior to the Termination Date, the Minimum
Offering has been raised, the Escrow Agent shall notify the Company and the
Dealer Manager.  The funds in the Escrow Account shall remain in the
Escrow Account until the Escrow Agent receives the Break Escrow Certificate from
the Company. Thereafter, the Company shall instruct the Escrow Agent to deliver
the amount of such escrowed funds as the Company shall direct (other than any
funds received from Pennsylvania Subscribers and Tennessee Subscribers, which
cannot be released until the conditions of Sections 3 and 4, respectively, have
been met); provided,
however, that the Escrow Agent shall not disburse those funds of a
subscriber whose subscription has been rejected or rescinded of which the Escrow
Agent has been notified by the Company, or otherwise in accordance with the
Company’s written request.  An officer’s certificate from an officer
of the Company to the Escrow Agent stating that the Minimum Offering has been
timely raised shall constitute sufficient evidence for the purpose of this
Agreement that such event has occurred (the “Break Escrow
Certificate”). The Break Escrow Certificate shall indicate (i) the
date on which the Minimum Offering was raised and (ii) the actual total
number of Shares sold as of such date.

     

    (c) If
the Escrow Agent has not received a Break Escrow Certificate on or prior to the
Termination Date, the Processing Agent shall provide the Escrow Agent the
information needed to return the amount of the funds in the Escrow Account,
together with any interest thereon, to each respective subscriber, and the
Escrow Agent shall promptly create and dispatch checks and wires drawn on the
Escrow Account to return the amount of the funds in the Escrow Account, together
with any interest thereon, without deduction, penalty or expense, to the
respective subscribers, and the Escrow Agent shall notify the Company and the
Dealer Manager of its distribution of the funds. The subscription payments returned to each subscriber (including those, if any,
returned to Pennsylvania Subscribers and Tennessee Subscribers pursuant to Sections 3 and 4, respectively)
shall be free and clear of any and all claims of the Company or any of its
creditors.

     

    (d)  After
the satisfaction of the provisions of Sections 2, 3 and 4 with respect to the
disbursement of funds, in the event that the Company receives subscriptions made
payable to the Escrow Agent, subscription proceeds may continue to be received
in the Escrow Account, but to the extent that the process shall not be subject
to escrow due to the Company reaching the Minimum Offering, the Tennessee
Minimum (as defined below) or the Pennsylvania Minimum (as defined below), as
the case may be, the proceeds are not subject to this Agreement, and at the
instruction of the Company to the Escrow Agent, shall be transferred from the
Escrow Account or deposited into, as the case may be, a commercial deposit
account in the name of the Company with the Processing Agent (the “Deposit Account”)
that has been previously established by the Company, unless otherwise directed
by the Company.  No provisions of this Agreement shall apply to the
Deposit Account.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    3. Distribution of the Funds
from the Pennsylvania Subscribers.

     

    (a) Notwithstanding
anything to the contrary herein, funds maintained in the Escrow Account for the
Pennsylvania Subscribers may only be disbursed in compliance with the provisions
of this Section 3. The
Escrow Agent shall continue to deposit funds received from the Pennsylvania
Subscribers into the Escrow Account until such time as the Company notifies the
Escrow Agent in writing that total subscriptions (including amounts in the
Escrow Account previously disbursed as directed by the Company and the amounts
then held in the Escrow Account) equal or exceed $50,000,000 (the “Pennsylvania
Minimum), whereupon the Escrow Agent shall disburse to the Company, at
the Company’s request, the amount of such escrowed funds as the Company shall
direct.  However, the Escrow Agent shall not disburse to the Company
those funds of a subscriber whose subscription has been rejected or rescinded of
which the Escrow Agent has been notified by the Company, or otherwise in
accordance with the Company’s written request.

     

    (b) If
the Company has not received total subscriptions of at least the Pennsylvania
Minimum within 120 days after the commencement of the Offering (the “Initial Escrow
Period”), the Company shall notify each Pennsylvania Subscriber by
certified mail or any other means (whereby receipt of delivery is obtained) of
the right of Pennsylvania Subscribers to have their investment returned to them
substantially in the form of Exhibit
C.  If, pursuant to such notice, a Pennsylvania Subscriber
requests the return of his or her subscription funds within 10 days after
receipt of the notification (the “Request Period”), the
Escrow Agent shall promptly refund, with a pro rata share of any interest earned
thereon and without deduction, directly to each Pennsylvania Subscriber the
funds deposited in the Escrow Account on behalf of the Pennsylvania
Subscriber.

     

    (c) The
funds of Pennsylvania Subscribers who do not request the return of their funds
within the Request Period shall remain in the Escrow Account for successive
120-day escrow periods (each a “Successive Escrow
Period”), each commencing automatically upon the termination of the prior
Successive Escrow Period, and the Company and the Escrow Agent shall follow the
notification and payment procedure set forth in Section 3(b)
with respect to the Initial Escrow Period for each Successive Escrow Period,
until the occurrence of the earliest of (i) the termination of the
Offering, (ii) the receipt and acceptance by the Company of total
subscriptions that equal or exceed the Pennsylvania Minimum and the disbursement
of the funds held in the Escrow Account on the terms specified in this Section 3, or
(iii) all funds held in the Escrow Account for Pennsylvania Subscribers
having been returned to the Pennsylvania Subscribers in accordance with the
provisions hereof.

     

    (d) If the Company has not received the Pennsylvania Minimum
within 365 days after the Break Escrow Certificate is delivered by the
Company pursuant to Section 2(b),
all of the funds in the Escrow Account for Pennsylvania Subscribers will be
promptly returned in full to the respective Pennsylvania Subscribers, together
with their pro rata share of any interest earned thereon pursuant to
instructions made by the Company, upon which the Escrow Agent may conclusively
rely.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    4. Distribution of the Funds
from the Tennessee Subscribers.

     

    (a) Notwithstanding
anything to the contrary herein, funds maintained in the Escrow Account for the
Tennessee Subscribers may only be disbursed in compliance with the provisions of
this Section 4. The
Escrow Agent shall continue to deposit funds received from the Tennessee
Subscribers into the Escrow Account, until such time as the Company notifies the
Escrow Agent in writing that total subscriptions (including amounts in the
Escrow Account previously disbursed as directed by the Company and the amounts
then held in the Escrow Account) equal or exceed $25,000,000 (the “Tennessee Minimum”),
whereupon the Escrow Agent shall disburse to the Company, at the Company’s
request, the amount of such escrowed funds as the Company shall
direct.  However, the Escrow Agent shall not disburse those funds of a
subscriber whose subscription has been rejected or rescinded of which the Escrow
Agent has been notified by the Company, or otherwise in accordance with the
Company’s written request.

     

    5. Escrowed Funds. Upon
receipt of funds from subscribers of Shares pursuant to the Offering, the Escrow
Agent shall hold such funds in escrow pursuant to the terms of this Agreement.
All such funds held in the Escrow Account shall be invested, as directed in
writing by the Company, in bank money market accounts and money market mutual
funds that are registered with the Securities and Exchange Commission meeting
the requirements of Rule 2a-7 under the Investment Company Act of
1940.  Notwithstanding anything herein to the
contrary, funds in the Escrow Account may only be invested in “Short Term
Investments” in compliance with Rule 15c2-4 of the Securities Exchange Act of
1934, as amended.  The Escrow Agent shall be entitled to sell or
redeem any such investment as necessary to make any distributions required under
this Agreement and shall not be liable or responsible for any loss resulting
from any such sale or redemption.

     

    Interest,
if any, resulting from the investment of the funds received from subscribers of
Shares pursuant to the Offering shall be distributed to subscribers on a pro
rata basis in accordance with the procedures herein for disbursing funds to
subscribers.

     

    The
Escrow Agent shall provide to the Company monthly statements (or more frequently
as reasonably requested by the Company) on the account balance in the Escrow
Account and the activities in the account since the last report.  Such
periodic statements shall identify the account balance, and the activities since
the last report.

     

    6. Duties of the Escrow
Agent. The Escrow Agent shall have no duties or responsibilities other
than those expressly set forth in this Agreement, and no implied duties or
obligations shall be read into this Agreement against the Escrow Agent. The
Escrow Agent is not a party to, or bound by, any other agreement among the other
parties hereto, and the Escrow Agent’s duties shall be determined solely by
reference to this Agreement. The Escrow Agent shall have no duty to enforce any
obligation of any person, other than as provided herein. The Escrow Agent shall
be under no liability to anyone by reason of any failure on the part of any
other party hereto or any maker, endorser or other signatory of any document or
any other person to perform such person’s obligations under any such
document.

     

    7. Liability of the Escrow
Agent and the Processing Agent; Indemnification. The Escrow Agent acts
hereunder as a depository only. The Escrow Agent is not responsible or liable in
any manner for the sufficiency, correctness, genuineness or validity of this
Agreement or with respect to the form of execution of the same. Each of the
Escrow Agent and the Processing Agent shall not be liable for any action taken
or omitted by it, or any action suffered by it to be taken or omitted, in good
faith, and in the exercise of its own best judgment, and may rely conclusively
and shall be protected in acting upon any order, notice, demand, certificate,
opinion or advice of counsel (including counsel chosen by the Escrow Agent or
the Processing Agent), statement, instrument, report or other paper or document
(not only as to its due execution and the validity and effectiveness of its
provisions, but also as to the truth and acceptability of any information
therein contained) which is reasonably believed by the Escrow Agent or the
Processing Agent to be genuine and to be signed or presented by the proper
person(s). Each of the Escrow Agent and the Processing Agent shall not be held
liable for any error in judgment made in good faith by an officer or employee of
either unless it shall be proved that the Escrow Agent or the Processing Agent,
as appropriate, was grossly negligent or reckless in ascertaining the pertinent
facts or acted intentionally in bad faith. The Escrow Agent shall not be bound
by any notice of demand, or any waiver, modification, termination or rescission
of this Agreement or any of the terms hereof, unless evidenced by a writing
delivered to the Escrow Agent signed by the proper party or parties and, if the
duties or rights of the Escrow Agent are affected, unless it shall give its
prior written consent thereto.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    Either of
the Escrow Agent and the Processing Agent may consult legal counsel and shall
exercise reasonable care in the selection of such counsel, in the event of any
dispute or question as to the construction of any provisions hereof or its
duties hereunder, and it shall incur no liability and shall be fully protected
in acting in accordance with the reasonable opinion or instructions of such
counsel. Each of the Escrow Agent and the Processing Agent
shall not be responsible, may conclusively rely upon and shall be protected,
indemnified and held harmless by the Company, for the sufficiency or accuracy of
the form of, or the execution, validity, value or genuineness of any document or
property received, held or delivered by it hereunder, or of the signature or
endorsement thereon, or for any description therein; nor shall the Escrow Agent
or the Processing Agent be responsible or liable in any respect on account of
the identity, authority or rights of the persons executing or delivering or
purporting to execute or deliver any document, property or this
Agreement.

     

    In the
event that either the Escrow Agent or the Processing Agent shall become involved
in any arbitration or litigation relating to the funds received from subscribers
of Shares pursuant to the Offering, each is authorized to comply with any
decision reached through such arbitration or litigation.

     

    The
Company hereby agrees to indemnify both the Escrow Agent and the Processing
Agent for, and to hold it harmless against, any loss, liability or expense
incurred in connection herewith without gross negligence, recklessness or
willful misconduct on the part of either of the Escrow Agent or the Processing
Agent, including without limitation reasonable and documented legal or other
fees arising out of or in connection with its entering into this Agreement and
carrying out its duties hereunder, including without limitation the costs and
expenses of defending itself against any claim of liability in the premises or
any action for interpleader. Neither the Escrow Agent, nor the Processing Agent,
shall be under any obligation to institute or defend any action, suit, or legal
proceeding in connection herewith, unless first indemnified and held harmless to
its satisfaction in accordance with the foregoing, except that neither shall be
indemnified against any loss, liability or expense arising out of its own gross
negligence, recklessness or willful misconduct. Such indemnity shall survive the
termination or discharge of this Agreement or resignation of the Escrow
Agent.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    8. The Escrow Agent’s
Fee. Escrow Agent shall be entitled to fees and expenses for its regular
services as escrow agent as set forth in Exhibit A. All of the
Escrow Agent’s compensation, costs and expenses shall be paid by the
Company.

     

    9. Security Interests.
No party to this Agreement shall grant a security interest in any monies or
other property deposited with the Escrow Agent under this Agreement, or
otherwise create a lien, encumbrance or other claim against such monies or
borrow against the same.

     

    10. Dispute. In the event
of any disagreement between the undersigned or the person or persons named in
the instructions contained in this Agreement, or any other person, resulting in
adverse claims and demands being made in connection with or for any papers,
money or property involved herein, or affected hereby, the Escrow Agent shall be
entitled to refuse to comply with any demand or claim, as long as such
disagreement shall continue, and in so refusing to make any delivery or other
disposition of any money, papers or property involved or affected hereby, the
Escrow Agent shall not be or become liable to the undersigned or to any person
named in such instructions for its refusal to comply with such conflicting or
adverse demands, and the Escrow Agent shall be entitled to refuse and refrain to
act until: (a) The rights of the adverse claimants shall
have been fully and finally adjudicated in a Court assuming and having
jurisdiction of the parties and money, papers and property involved herein or
affected hereby, or (b) All differences shall have been adjusted by
agreement and the Escrow Agent shall have been notified thereof in writing,
signed by all the interested parties.

     

    11. Resignation of Escrow
Agent. Escrow Agent may resign or be removed, at any time, for any
reason, by written notice of its resignation or removal to the proper parties at
their respective addresses as set forth herein, at least 60 days before the date
specified for such resignation or removal to take effect; upon the effective
date of such resignation or removal:

     

    (a) All
cash and other payments and all other property then held by the Escrow Agent
hereunder shall be delivered by it to such successor escrow agent as may be
designated in writing by the Company, whereupon the Escrow Agent’s obligations
hereunder shall cease and terminate;

     

    (b) If no
such successor escrow agent has been designated by such date, all obligations of
the Escrow Agent hereunder shall, nevertheless, cease and terminate, and the
Escrow Agent’s sole responsibility thereafter shall be to keep all property then
held by it and to deliver the same to a person designated in writing by the
Company or in accordance with the directions of a final order or judgment of a
court of competent jurisdiction.

     

    (c)
Further, if no such successor escrow agent has been designated by such date, the
Escrow Agent may petition any court of competent jurisdiction for the
appointment of a successor agent; further the Escrow Agent may pay into court
all monies and property deposited with Escrow Agent under this
Agreement.

     

    12. Notices.

     

    (a)  All
notices, demands and requests required or permitted to be given under the
provisions hereof must be in writing and shall be deemed to have been
sufficiently given, upon receipt, if (i) personally delivered,
(ii) sent by telecopy and confirmed by phone or (iii) mailed by
registered or certified mail, with return receipt requested, delivered to the
addresses set forth below, or to such other address as a party shall have
designated by notice in writing to the other parties in the manner provided by
this paragraph:

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    
      	 
      	 
      	 
      
	
              (1) If to Company:

            	
                

            	
              Empire
      American Realty Trust, Inc.

            
	 
      	
                

            	
              25
      Philips Parkway

            
	 
      	
                

            	
              Montvale,
      New Jersey 07645

            
	 
      	
                

            	
              Attention:
      David Newman

            
	 
      	
                

            	
              Telephone:
      (201) 326-3300

            
	 
      	
                

            	
              Facsimile:
      (201) 326-6936

            
	 
      	 
      
	 
      	 
      
	
              (2) If to the Escrow Agent:

            	
                

            	
              UMB
      Bank, N.A.

            
	 
      	
                

            	
              1010
      Grand Blvd., 4th Floor

            
	 
      	
                

            	
              Mail
      Stop: 1020409

            
	 
      	
                

            	
              Kansas
      City, Missouri 64106

            
	 
      	
                

            	
              Attention:
      Lara Stevens,

            
	 
      	
                

            	
              Corporate
      Trust

            
	 
      	
                

            	
              Telephone:
      (816) 860-3017

            
	 
      	
                

            	
              Facsimile:
      (816) 860-3029

            
	 
      	 
      
	 
      	
                

            	
              Checks
      Payable Information:

            
	 
      	
                

            	
              UMB
      Bank, as Escrow Agent for Empire REIT

            
	 
      	
                

            	
              Attention: Lara Stevens, Corporate
      Trust

              1010 Grand Boulevard,
      4th Floor

              M/S 1020409

              Kansas City, Missouri
      64106

            
	 
      	 
      
	
              (3)
      If to Dealer Manager:

            	
                

            	
              Empire
      American Realty, LLC

            
	 
      	
                

            	
              25
      Philips Parkway

            
	 
      	
                

            	
              Montvale,
      New Jersey 07645

            
	 
      	
                

            	
              Attention:
      Martel Day

            
	 
      	
                

            	
              Telephone:
      (201) 326-3300

            
	 
      	
                

            	
              Facsimile:
      (201) 326-6936

            


    

     

    (b)           All
drafts, wires or Automated ClearingHouse (ACH) payments required or permitted to
be transmitted under the provisions hereof shall be transmitted to the Company
or the Escrow Agent, as appropriate, to the account set forth on Schedule I, or such
other account as a party shall have designated by notice in writing to the other
parties in the manner provided in Section
12(a).

    


    13. Governing Law. This
Agreement shall be construed and enforced in accordance with the laws of the
State of New York without regard to the principles of conflicts of law that
would apply the laws of another jurisdiction.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    14. Binding Effect;
Benefit. This Agreement shall be binding upon and inure to the benefit of
the permitted successors and assigns of the parties hereto.

     

    15. Modification. This
Agreement may be amended, modified or terminated at any time by a writing
executed by the Dealer Manager, the Company and the Escrow Agent.

     

    16. Assignability. This
Agreement shall not be assigned by the Escrow Agent without the Company’s prior
written consent.

     

    17. Counterparts. This
Agreement may be executed in one or more counterparts, each of which will be
deemed an original, but all of which together will constitute one and the same
instrument. Copies, telecopies, facsimiles, electronic files and other
reproductions of original executed documents shall be deemed to be authentic and
valid counterparts of such original documents for all purposes, including the
filing of any claim, action or suit in the appropriate court of
law.

     

    18. Headings. The section
headings contained in this Agreement are inserted for convenience only, and
shall not affect in any way, the meaning or interpretation of this
Agreement.

     

    19. Severability. This
Agreement constitutes the entire agreement among the parties and supersedes all
prior and contemporaneous agreements and undertakings of the parties in connection herewith. No failure or delay of the Escrow Agent in
exercising any right, power or remedy may be, or may be deemed to be, a waiver
thereof; nor may any single or partial exercise of any right, power or remedy
preclude any other or further exercise of any right, power or remedy. In the
event that any one or more of the provisions contained in this Agreement, shall,
for any reason, be held to be invalid, illegal or unenforceable in any respect,
then to the maximum extent permitted by law, such invalidity, illegality or
unenforceability shall not affect any other provision of this
Agreement.

     

    20. Earnings Allocation; Tax
Matters; Patriot Act Compliance; OFAC Search Duties. The Company or its
agent shall be responsible for all tax reporting under this Agreement. The
Company shall provide to Escrow Agent upon the execution of this Agreement any
documentation requested and any information reasonably requested by the Escrow
Agent to comply with the USA Patriot Act of 2001, as amended from time to time.
The Escrow Agent, or its agent, shall complete an OFAC search, in compliance
with its policy and procedures, of each subscription check and shall inform the
Company if a subscription check fails the OFAC search. The Dealer Manager shall
provide a copy of each subscription check in order that the Escrow Agent, or its
agent, may perform such OFAC search.

     

    21. Miscellaneous. This
Agreement shall not be construed against the party preparing it, and shall be
construed without regard to the identity of the person who drafted it or the
party who caused it to be drafted and shall be construed as if all parties had
jointly prepared this Agreement and it shall be deemed their joint work product,
and each and every provision of this Agreement shall be construed as though all
of the parties hereto participated equally in the drafting hereof; and any
uncertainty or ambiguity shall not be interpreted against any one party. As a
result of the foregoing, any rule of construction that a document is to be
construed against the drafting party shall not be applicable.

     

    22. Third Party
Beneficiaries. The Processing Agent shall be a third party beneficiary
under this Agreement, entitled to enforce any rights, duties or obligations owed
to it under this Agreement notwithstanding the terms of any other agreements
between the Processing Agent and any party hereto.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    23. Termination of the Escrow
Agreement. This Agreement, except for Sections 7 and 11 hereof, which
shall continue in effect, shall terminate upon written notice from the Company
to the Escrow Agent. Unless otherwise provided, final termination of this
Agreement shall occur on the date that all funds held in the Escrow Account are
distributed either (a) to the Company or to subscribers and the Company has
informed the Escrow Agent in writing to close the Escrow Account or (b) to
a successor escrow agent upon written instructions from the
Company.

     

    24. Relationship of
Parties. Both of the Dealer Manager and the Company are unaffiliated with
the Escrow Agent, and this Agreement does not create any partnership or joint
venture among any of the parties hereto. Subscriptions made by the Company,
Dealer Manager, the Dealers or any of their affiliated persons shall be counted
toward reaching the Minimum Offering.

    


    


     

    [SIGNATURE
PAGES FOLLOW]

     

    


     

    


    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    


     

    IN WITNESS WHEREOF, the
undersigned have caused this Agreement to be executed by their duly authorized
representatives as of the date first written hereinabove:

     

     

    
      	 	
              DEALER
      MANAGER:

               

              EMPIRE
      AMERICAN REALTY, LLC

               

              By:
      ________________________

              Name:
      Martel Day

              Title:
      President

               

            
	 	
              COMPANY:

               

              EMPIRE
      AMERICAN REALTY TRUST, INC.

               

              By:
      ________________________

              Name:
      David Newman

              Title:
      Chief Operating Officer

               

            
	 	
              ESCROW
      AGENT:

               

              UMB BANK,
      N.A.

               

              By:
      ________________________

              Name:

              Title:

            


    

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
A

     

    ESCROW
FEES AND EXPENSES

     

    
      	 
      	 
      	 
      	 
      	 
      
	
              Acceptance
      Fee

            	
                

            	 
      	 
      	 
      
	
              Review
      escrow agreement and establish account

            	
                

            	
              $

            	
              3,000

            	 
      
	 
      	 
      
	
              Annual
      Fee

            	
                

            	 
      	 
      	 
      
	
              Maintain
      account

            	
                

            	
              $

            	
              3,000

            	 
      
	 
      	 
      
	
              Transaction
      Fees

            	
                

            	 
      	 
      	 
      
	
              (a)
      per outgoing wire transfer

            	
                

            	
              $

            	
              35.00

            	 
      
	
              (b)
      per Form 1099 (Int., B or Misc.)

            	
                

            	
              $

            	
              10.00

            	
              *

            
	
              (c)
      per investment purchase, sale or settlement

            	
                

            	
              $

            	
              35.00

            	
              **

            


    

    
      
        
          

        

      

    

    
      	
              *

            	
              Not
      anticipated to be charged

            


    

    
      	
              **

            	
              Excludes
      money market mutual fund
transactions

            


    

     

    Fees
specified are for the regular, routine services contemplated by the Escrow
Agreement, and any additional or extraordinary services, including, but not
limited to disbursements involving a dispute or arbitration, or administration
while a dispute, controversy or adverse claim is in existence, will be charged
based upon time required at the then standard hourly rate. In addition to the
specified fees, all reasonable and documented expenses related to the
administration of the Escrow Agreement (other than normal overhead expenses of
the regular staff) such as, but not limited to, travel, postage, shipping,
courier, telephone, facsimile, supplies, legal fees, accounting fees, etc., will
be reimbursable. Acceptance and first year annual fees will be payable at the
initiation of the escrow and annual fees will be payable in advance thereafter.
Other fees and expenses will be billed as incurred.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
B

    


    Form of
Subscriber List

    


    Pursuant
to the Escrow Agreement dated as of _________ ___, 2009, by and among Empire
American Realty Trust, Inc. (the “Company”), UMB Bank,
N.A., as escrow agent (the “Escrow Agent”), and
Empire American Realty, LLC (the “Dealer Manager”), the
undersigned hereby notifies the Escrow Agent that, as of the date set forth
below, the following Subscribers have submitted subscription funds for the
purchase of shares of common stock of the Company (the “Shares”), and such
subscription funds have been deposited with Escrow Agent in accordance with the
Escrow Agreement:

    


    
      	
            	
              1. 

            	
              Name
      of Subscriber

            


    

    Address

    Tax
Identification Number

    Number of
Shares subscribed for

    Amount of
money paid and deposited with Escrow Agent

    Is
Subscriber a resident of Pennsylvania (Yes or No)?

    Is
Subscriber a resident of Tennessee (Yes or No?)

    


    
      	
            	
              2.

            	
              Name
      of Subscriber

            


    

    Address

    Tax
Identification Number

    Number of
Shares subscribed for

    Amount of
money paid and deposited with Escrow Agent

    Is
Subscriber a resident of Pennsylvania (Yes or No)?

    Is
Subscriber a resident of Tennessee (Yes or No?)

     

    
      	
            	
              ... 

            	
              Name
      of Subscriber

            


    

    Address

    Tax
Identification Number

    Number of
Shares subscribed for

    Amount of
money paid and deposited with Escrow Agent

    Is
Subscriber a resident of Pennsylvania (Yes or No)?

    Is
Subscriber a resident of Tennessee (Yes or No?)

    


    _____________________

    


    


    By:____________________________________

    Name:_________________________________

    Title:__________________________________

    Date:
______________________ ____, 200___

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
C

    


    Form of
Notice to Pennsylvania Subscribers

    


    You have
tendered a subscription to purchase shares of common stock of Empire American
Realty Trust, Inc. (the “Company”). Your
subscription is currently being held in escrow.  The guidelines of the
Pennsylvania Securities Commission do not permit the Company to accept
subscriptions from Pennsylvania residents until an aggregate of $50,000,000 of
gross offering proceeds have been received by the Company. The Pennsylvania
guidelines provide that until this minimum amount of offering proceeds is
received by the Company, every 120 days during the offering period
Pennsylvania Subscribers may request that their subscription be
returned.  If you wish to continue your subscription in escrow until
the Pennsylvania minimum subscription amount is received, nothing further is
required.

    


    If you
wish to terminate your subscription for the Company’s common stock and have your
subscription returned please so indicate below, sign, date, and return to the
Escrow Agent, UMB Bank, N.A.

    


    I hereby
terminate my prior subscription to purchase shares of common stock of Empire
American Realty Trust, Inc. and request the return of my subscription
funds.  I certify to Empire American Realty Trust, Inc. that I am a
resident of Pennsylvania.

    


    
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
              Signature:

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
              Name:

            	 
      
	 
      	 
      	 
      	 
      	
                      (please
      print)

            	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
              Date:

            	 
      


    

    


    Please
send the subscription refund to:

        
             
             
             
             
             
    

          
       
       
       
       
       
       
       
       
        

          
       
       
       
       
       
       
       
       
        

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    
 

    SCHEDULE
I

    


    Wire
Instructions

    


    


    
      	
              If
      to the Company:

            
	
              Empire
      American Realty Trust, Inc.

            
	
              ABA
      Routing Number: 

            
	
              Account
      Number: 

            
	
              FFC
      Account Name: 

            
	
              FFC:
              

            


    

    


    
      	
              If
      to the Escrow Agent:

            
	
              UMB
      Bank, N.A.

            
	
              ABA
      Routing Number: 

            
	
              Account
      Number: 

            
	
              Account Name: UMB Bank, N.A., as
      Escrow Agent for Empire REIT

            
	 
      


    

    


    


    
      
        
        

      

      
        -15-