Exhibit 10.1










INTERVEST
MORTGAGE CORPORATION 

ESCROW
AGREEMENT




THIS
ESCROW AGREEMENT made as of this __th day of _________, 2005, by and among
Intervest Mortgage Corporation, a New York corporation with its principal
offices at One Rockefeller Plaza, Suite 400, New York, New York 10020-2002
(“Corporation”); Sage, Rutty & Co., Inc., a New York corporation with its
principal offices at 1621 Jefferson Road, Rochester, New York 14623
(“Underwriter”); and Canandaigua National Bank and Trust Company, a national
banking organization with its principal offices at 72 South Main Street,
Canandaigua, New York 14424 (“Escrow Agent”).




R E C I T
A L S:




WHEREAS,
the Corporation has filed a Form S-11 Registration Statement under the
Securities Act of 1933 with the Securities and Exchange Commission
(“Registration Statement”) covering a proposed offering of a minimum of
$12,000,000 and maximum of $14,000,000 aggregate principal amount of its Series
__/__/05 Subordinated Debentures (“Debentures”); and




WHEREAS,
the Underwriter intends to sell the Debentures as the Corporation’s agent on a
best efforts basis; and




WHEREAS,
under the terms of the offering, subscription funds received on the sale of
Debentures will be deposited in an escrow account until certain terms and
conditions have been met; and




WHEREAS,
the Corporation desires that the subscription funds be held in escrow by the
Escrow Agent on the terms and conditions set forth herein.




NOW,
THEREFORE, in consideration of the mutual covenants contained herein, the
parties agree as follows:





	 	
      1.
	
      Establishment
      and Custody of Escrow Fund.







 

(a)   On or
prior to the date of the commencement of the offering of the Debentures, the
parties shall establish an interest-bearing escrow account with the Escrow
Agent. The Corporation will notify the Escrow Agent in writing of the effective
date of the Registration Statement. The escrow account shall be entitled
“Canandaigua National Bank & Trust Company, as Escrow Agent for Intervest
Mortgage Corporation.” The Corporation shall, prior to the establishment of such
account, furnish to the Escrow Agent a completed IRS Form W-9. 

 

(b)   On the
next Business Day following receipt by the Corporation or the Underwriter from
an investor desiring to purchase Debentures (“Subscriber(s)”) or from any
participating selected dealer, of any subscription documents and payment of the
subscription price (in the minimum of $10,000) for Debentures to be purchased,
it will promptly transmit to the Escrow Agent the following:





(i)   Checks,
bank drafts or money orders payable to “CNB - Escrow Intervest” or wire
transfers to the escrow account (such sums as held by Escrow Agent in collected
funds, as increased or decreased by any investments, reinvestments or
distributions made in respect thereof and any interest thereon as held from time
to time by the Escrow Agent pursuant to the terms of this Escrow Agreement,
being hereafter collectively referred to as the “Escrow Fund”). Such funds shall
be delivered to Canandaigua National Bank and Trust Company, 1150
Pittsford-Victor Road, Pittsford, New York 14534, Attention: Sharon Greisberger,
Vice President, by 12:00 noon on the next Business Day after receipt, for
deposit in accordance with Section 2; and




(ii)   With each deposit to the
Escrow Fund, a statement containing the name, address and tax identification
number of each Subscriber. 










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(c)   Checks or other forms of
payment not made payable to the Escrow Agent shall be returned by the Escrow
Agent to the purchaser who submitted the check. 




(d)   For purposes of this
Escrow Agreement, a “Business Day” is a day upon which the Escrow Agent is open
for the conduct of business.




(e)   The Escrow Agent will
acknowledge receipt of the Escrow Fund and will hold the Escrow Funds subject to
the terms and conditions of this Escrow Agreement.




(f)   The Escrow Agent shall
notify the Corporation when the total amount of subscription funds in the Escrow
Fund, less the amount of any such checks returned for insufficient funds, equals
at least $12,000,000 (the “Minimum Funds”). No investment profits or losses and
no interest earned on any investment of the Escrow Fund shall be considered for
purposes of this calculation.




(g)   During the term of this
Escrow Agreement, the Corporation understands that it is not entitled to any
funds received into escrow and no amounts deposited shall become the property of
the Corporation or any other entity, or be subject to the debts of the
Corporation or any other entity. 




2.     Investment
of Escrow Fund. Moneys
held in the Escrow Fund shall be invested and reinvested by the Escrow Agent in
its trust money market account. Moneys held in the Escrow Fund will, in any
event, be invested only in investments permissible under Rule 15c2-4 under the
Securities Exchange Act of 1934.




3.     Duties
of Escrow Agent.
Acceptance by the Escrow Agent of its duties under this Escrow Agreement is
subject to the following terms and conditions, which all parties to this Escrow
Agreement agree shall govern and control with respect to the rights, duties,
liabilities and immunities of the Escrow Agent.




(a)   The
duties and responsibilities of the Escrow Agent shall be limited to those
expressly set forth in this Escrow Agreement and the Escrow Agent shall not be
subject to, nor obligated to recognize, any other agreements between the
Corporation, Underwriter and any Subscriber.




(b)   The
duties of the Escrow Agent are only such as are herein specifically provided and
such duties are purely ministerial in nature. The Escrow Agent’s primary duty
shall be to keep custody of and safeguard the Escrow Fund during the period of
the escrow, to invest monies held in the Escrow Fund in accordance with Section
2 hereof and to make disbursements from the Escrow Fund in accordance with
Section 4 hereof.




(c)   The
Escrow Agent shall be under no obligations in respect of the Escrow Fund other
than to faithfully follow the instructions herein contained or delivered to the
Escrow Agent in accordance with this Escrow Agreement. The Escrow Agent may rely
and act upon any written notice, instruction, direction, request, waiver,
consent, receipt or other paper or document which it in good faith believes to
be genuine and what it purports to be and the Escrow Agent shall be subject to
no liability with respect to the form, execution or validity thereof. If, in the
opinion of the Escrow Agent, the instructions it receives are ambiguous,
uncertain or in conflict with any previous instructions or this Escrow
Agreement, then the Escrow Agent is authorized to hold and preserve intact the
Escrow Fund pending the settlement of any such controversy by final adjudication
of a court or courts of proper jurisdiction.




(d)   The
Escrow Agent shall not be liable for any error of judgment or for any act done
or step taken or omitted by it, in good faith, or for any mistake of fact or
law, or for anything which it may in good faith do or refrain from doing in
connection herewith, unless caused by its willful misconduct or gross
negligence. The Corporation shall indemnify and hold the Escrow Agent harmless
from and against any and all claims, losses, damages, liabilities and expenses,
including reasonable attorneys’ fees, which may be imposed upon the Escrow Agent
or incurred by the Escrow Agent in connection with its acceptance of the
appointment as Escrow Agent hereunder or the performance of its duties
hereunder, unless the Escrow Agent is determined to have committed an
intentional wrongful act or to have been grossly negligent with respect to its
duties under this Escrow Agreement.










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(e)   The
Escrow Agent shall return to the Corporation any sums delivered to the Escrow
Agent pursuant to this Escrow Agreement for which the Escrow Agent has not
received release instructions pursuant to Section 4 hereof, and as to which four
years have passed since delivery.




(f)   The
Escrow Agent may consult with, and obtain advice from, legal counsel (which may
not be counsel to the Corporation) in the event of any dispute or questions as
to the construction of any of the provisions hereof or its duties hereunder, and
it shall incur no liability in acting in good faith in accordance with the
written opinion and instructions of such counsel. The fees for consultation with
such counsel shall be paid by the Corporation.




(g)   Reference
in this Escrow Agreement to the Registration Statement is for identification
purposes only, and its terms and conditions are not thereby incorporated
herein.




4.    Distribution
and Release of Funds.




(a)   For
purposes of this Escrow Agreement, the term “Termination Date” shall mean the
earlier of:




(i)    ____________,
2005, or such later date set forth in a written notice purportedly executed by
the Corporation and delivered to the Escrow Agent at least five (5) Business
Days prior to ___________, 2005.

 

(ii)   The date,
if any, upon which the Escrow Agent receives a written notice purportedly
executed by the Corporation stating that the offering has been terminated, or
such later date set forth in such notice as the effective date of such
termination; or

 

(iii)   Any date
specified by the Corporation in writing, after the date the Escrow Agent has
confirmed that it has received in the Escrow Fund at least the Minimum Funds in
good, collected funds.




(b)   On the Termination Date,
the Escrow Agent shall certify to the Corporation in writing the total amount of
collected funds in the Escrow Fund.




(c)   The
Escrow Agent shall return the funds deposited with it to the Subscribers if, on
the Termination Date, the Escrow Fund does not consist of collected funds
totaling at least the Minimum Funds. The Escrow Agent shall have fully
discharged this obligation to return Subscribers’ funds if it has mailed to each
Subscriber, at the address furnished to it by the Corporation, the Underwriter
or any selected dealer, by registered or certified mail, return receipt
requested, a bank check made payable to each Subscriber for the amount
originally deposited by that Subscriber, plus the Subscriber’s pro rata share of
net interest (defined below) earned without regard to the date the Subscriber’s
funds were deposited. For purposes of this Escrow Agreement, “net interest”
shall mean the interest earned on the Escrow Fund, less any fees or expenses of
the Escrow Agent paid from the Escrow Fund pursuant to Section 5. 




(d)   At such time as (i) the
total amount of collected funds in the Escrow Fund equals at least the Minimum
Funds, and (ii) the Escrow Agent has received, on or before the Termination
Date, written instructions executed by the Underwriter and the Corporation, the
Escrow Agent shall distribute the entire Escrow Fund, less commissions, fees and
expense reimbursement due to the Underwriter and any selected dealers, pursuant
to such instructions. The commissions, fees and expense reimbursement due to the
Underwriter and selected broker-dealers shall be set forth in the written
instructions, and the Escrow Agent shall distribute the commissions, fees and
expense reimbursement due to the Underwriter and selected dealers directly to
the Underwriter. Subject to the foregoing, distributions may be made to third
parties at the direction of the Corporation. Net interest earned on the Escrow
Fund shall be paid to the Corporation.










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(e)   If the
Corporation rejects a subscription for which the Escrow Agent has already
collected funds, the Escrow Agent shall promptly issue a refund check to the
rejected Subscriber. Otherwise, the Escrow Agent shall promptly remit the
rejected Subscriber’s check directly to the Subscriber. Any check returned
unpaid to the Escrow Agent will be returned to the Underwriter or selected
dealer that submitted the check. Any check or other form of payment received by
the Escrow Agent not payable to “CNB - Escrow Intervest” shall be returned to
the Subscriber by the Escrow Agent.




(f)   For purposes hereof,
“collected funds” shall mean all funds received by the Escrow Agent which have
cleared normal banking channels and are in the form of cash. Furthermore, a
check which is not (i) a certified check or (ii) a bank draft or a cashiers
check drawn on a bank reasonably acceptable to the Escrow Agent, shall
constitute “collected funds” only if it has not been returned for insufficient
funds within ten (10) Business Days after its receipt by the Escrow Agent. No
investment profits or losses and no interest earned on any investments of the
Escrow Fund shall be considered for purposes of the above
calculation.




(g)   It shall
be a condition to the return of funds to any subscriber hereunder that such
subscriber shall have delivered to the Escrow Agent a completed IRS Form W-9.
The Corporation shall include in the Prospectus which is part of the
Registration Statement and/or in the subscription forms to be executed by
subscribers, notice of the requirement for delivery of such IRS Form W-9 as a
condition to the return of funds deposited in the Escrow Account.




(h)   This Escrow Agreement
shall terminate on the final distribution of the Escrow Fund, at which time the
Escrow Agent shall be forever and irrevocably released and discharged from any
and all further responsibility or liability with respect to the Escrow
Fund.




5.     Compensation. The
Corporation agrees to pay the Escrow Agent a fee of $500 as compensation for its
services in connection with establishing the Escrow Fund, payable at the time
this Escrow Agreement is executed, whether or not any Debentures are sold. In
addition, the Corporation shall pay an annual maintenance fee of $100, prorated
for the number of months the Escrow Account is open, payable whether or not any
Debentures are sold. The Corporation shall pay, in addition to the foregoing
fees, the following charges:

 


$1,000.00     Handling
and processing fees.

  $ 7.50     Per check
disbursed.

            $ 10.00     Per prorated
net interest computation if funds are returned to investors.

            $ 10.00     Per Form 1099
required to be transmitted by the Escrow Agent.

            $ 25.00     Per check
returned for insufficient funds.

             $15.00     Per wire
transfer



Except
for the set-up fee due upon execution of this Escrow Agreement, the fees and
charges shall be paid by the Corporation on the date(s) the Escrow Fund is
distributed pursuant to Section 4. The Escrow Agent shall have the right to
cause any fees due hereunder to be paid out of the interest earned on the Escrow
Account.




6.     Termination. This
Escrow Agreement shall terminate no later than the Termination Date, or on such
earlier date as the Escrow Agent shall have paid out a total of at least
$12,000,000 in collected funds in accordance with the provisions of this Escrow
Agreement.




7.     Resignation
and Removal of Escrow Agent. The
Escrow Agent may at any time resign and be discharged of the duties and
obligations created by this Escrow Agreement by giving at least sixty (60) days’
written notice to the Corporation and the Underwriter; the Escrow Agent may be
removed at any time upon sixty (60) days’ notice by an instrument purportedly
signed by an authorized person of the Corporation and the Underwriter. Any
successor Escrow Agent shall be appointed and approved by the Corporation and
the Underwriter. Any such successor Escrow Agent shall deliver to the former
Escrow Agent a written instrument, acknowledged by the Corporation and the
Underwriter, accepting such appointment hereunder and thereupon it shall take
delivery of the Escrow Fund to hold and distribute in accordance with the terms
hereof. If no successor Escrow Agent shall have been appointed within thirty
(30) days after the Corporation and the Underwriter are notified of the Escrow
Agent’s resignation, the Escrow Agent shall return the Escrow Fund to the
Subscribers in accordance with the procedure set forth in Section 4(c). Upon the
delivery of the Escrow Fund in accordance with this Section 7, the Escrow Agent
shall be discharged from any further duties hereunder.










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8.     Binding
Effect. This
Escrow Agreement shall be binding upon and inure to the benefit of the parties,
their successors and assigns.




9.     Headings. The
headings contained in this Escrow Agreement are intended for convenience and
shall not in any way determine the rights of the parties to this Escrow
Agreement.




10.    Waiver. Waiver
of any terms or conditions of this Escrow Agreement by any party shall not be
construed as (a) a waiver of a subsequent breach or failure of the same term or
condition, or (b) a waiver of any other term or condition of this Escrow
Agreement.




11.     Counterparts. This
Escrow Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, and it shall not be necessary in making proof of
this Escrow Agreement to produce or account for more than one such
counterpart.




12.     Modification. This
Escrow Agreement constitutes the entire agreement between the parties as to the
escrow of Subscribers’ funds, and shall not be modified except in writing signed
and acknowledged by all the parties.




13.     Notices. All
notices and communications hereunder shall be in writing and shall be deemed to
be duly given on the date delivered by the United States Mail, registered or
certified mail, return receipt requested, postage prepaid to the address of the
Corporation and Underwriter as first above written, and to the Escrow Agent at
1150 Pittsford-Victor Road, Pittsford, New York 14534, Attention: Sharon
Greisberger, Vice President, provided, however, that notices may be given by
telex, cable, telecopier, courier service, telephone, personal delivery or
otherwise, effective the date of such communication, provided that notices given
by such means of communications are confirmed by mail as aforesaid, postmarked
within one business day after such other form of communication.




14.     Governing
Law. This
Escrow Agreement shall be construed and enforced in accordance with the laws of
the State of New York. The parties consent to the personal jurisdiction of all
courts of the State of New York, and agree that such jurisdiction shall be
exclusive.




IN
WITNESS WHEREOF, the parties have executed and delivered this Escrow Agreement
as of the date and year first above written.




 


	
      CORPORATION:
	 	INTERVEST MORTGAGE CORPORATION
      
	 	 	 	 
	 	 	By:	 
	 	 	Its:	 
	 	 	 	 
	
      ESCROW AGENT:
	 	CANANDAIGUA NATIONAL BANK AND TRUST
      COMPANY
	 	 	 	 
	 	 	By: 	 
	 	 	Its:	 
	 	 	 	 
	
      UNDERWRITER:
	 	SAGE, RUTTY & CO.,
    INC.
	 	 	 	 
	 	 	By:	 
	 	 	Its:	 



 







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