Looking for a specific Misc. Escrow Agreement?
Below is a list of Misc. Escrow Agreements signed by actual companies.
Preview of our top selling Misc. Escrow Agreement
Prime Cellular - Escrow Agreement
ESCROW AGREEMENT
ESCROW AGREEMENT, dated June __, 1996, by and among Prime Cellular, Inc., a Delaware corporation ("Prime"); Prime Cellular Acquisition Corp., a Delaware corporation (the "Prime Acquisition Subsidiary"); the persons listed on Schedule 1 hereto (the "Bern Owners"); and Tenzer Greenblatt LLP, a New York limited liability partnership (the "Escrow Agent").
B A C K G R O U N D F A C T S:
------------------------------
A. Pursuant to a Merger Agreement dated as of May 14, 1996 (the "Merger Agreement"), by and among Prime, Prime Acquisition Subsidiary, Bern Associates, Inc., a New Jersey corporation ("Bern") and the Bern Owners, Bern merged with and into Prime Acquisition Subsidiary and the outstanding shares of capital stock of Bern have been converted into shares of the common stock, $.01 par value, of Prime (the "Prime Stock").
B. Pursuant to the Merger Agreement each of Prime, Prime Acquisition Subsidiary, the Bern Owners and Bern entered into an Indemnification Agreement of even date herewith (the "Indemnification Agreement", which Indemnification Agreement is incorporated herein as if fully set forth herein), whereby the Bern Owners agreed to indemnify Prime and the Surviving Corporation (as such term is defined in the Merger Agreement) for certain loss contingencies, and
it is a requirement under the Indemnification Agreement that the Bern Owners and the Escrow Agent shall have executed and delivered an agreement in the form hereof.
C. The purpose of this Agreement is to provide security, in the form of the shares of Prime Stock delivered pursuant to the Merger Agreement, for the indemnity furnished by the Bern Owners to Prime and the Surviving Corporation pursuant to the Indemnification Agreement.
A G R E E M E N T:
-----------------
NOW, THEREFORE, for good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree, as follows:
1. Certain Definitions. For all purposes of this Agreement, the following terms shall have the following meanings: -------------------
(a) The term "Collateral" shall mean (x) the Prime Stock at any time
represented by the Escrow Certificates delivered to the Escrow Agent
pursuant to Section 3, (y) any other Prime Stock received by the Escrow
Agent as provided in Section 7 and (z) all other property or cash obtained
by the Escrow Agent in respect of or in exchange for the Prime Stock.
(b) The term "Escrow Fund" shall mean the Collateral delivered to the
Escrow Agent pursuant to Section 7 hereof.
-2-
(c) The term "Final Determination" shall mean the final decision of
any court of competent jurisdiction from which no appeal has been allowed
because of lapse of time or otherwise.
(d) The term "Indemnified Parties" shall mean Prime and the Surviving
Corporation.
(e) The term "Loss" shall mean any losses, damages, expenses,
liabilities, claims, settlements, assessments, judgments, expenses or costs
(including, without limitation, reasonable attorneys' fees) incurred or
suffered by Prime or the Surviving Corporation (net of any insurance
proceeds actually received by the Prime Entities) as a result of any claim,
or the defense, settlement or investigation thereof arising out of, caused
by, based upon or resulting from any breach by Bern or any Bern Owners of
their respective representations and warranties, obligations or covenants
contained in the Merger Agreement or any document or certificate referred
to in and delivered or to be delivered by Bern or any of the Bern Owners
pursuant to the Merger Agreement. The amount of any Loss shall be
determined, either by payment for the Loss claimed as certified to by the
President or Principal of the Indemnified Party or Parties in a Claim
Certificate (as defined in Section 4(a) hereof), or by entry of a final
judgment, order or decree (after exhaustion or expiration of appeal rights)
by a court of competent jurisdiction.
(f) The term "Proportionate Share" with respect to any Bern Owner
shall mean the number of shares of Prime Stock equal to that fraction,
determined as of the date of any particular Payout (as defined in Section
4(b) hereof), the numerator of which is the total number of Shares of Prime
Stock delivered to any Bern Owner pursuant to the Merger and the
denominator of which is the total number of shares of Prime Stock held by
all of the Bern Owners.
-3-
(g) The term "Termination Date" shall mean the earlier of (i) the date
of the filing of Prime's Annual Report on Form 10-K for the fiscal year
ending May 31, 1997, subject to the provisions of Paragraph 5 or (ii)
September 13, 1997.
(h) The term "Threshold Amount" shall mean an aggregate of $50,000 of
Losses.
(i) The following terms shall have the meanings ascribed to them in
this Agreement as set forth in the reference Section opposite such term:
Term Sectio
Claim Certificate Section 4(a)
Escrow Certificate Section 3(a)
Estimated Loss Section 5
Majority Owners Section 4(c)
Objection Notice Section 4(c)
Payout Section 4(b)
(j) Capitalized terms not otherwise defined herein shall have the
meanings ascribed to such terms in the Merger Agreement, which terms and
meanings ascribed thereto are incorporated herein as if fully set forth
herein.
2. Indemnification and Escrow Fund. This Agreement has been executed and delivered, and the Escrow Fund has been established, for the purpose of providing funds for any liability obligations incurred by Bern and/or any Bern Owner under the Indemnification Agreement, including, without limitation, all damages, costs and expenses indemnified against thereunder, with respect to the Losses. The provisions of the Indemnification Agreement shall establish the notice requirements and mechanics of defense for all claims of indemnification for which the Escrow Fund established hereby is available and are incorporated by reference herein.
-4-
3. Escrowed Stock.
(a) At the Effective Time, Prime shall deposit with the Escrow Agent, for the account of the Bern Owners, certificates registered in the name of the Escrow Agent (each, an "Escrow Certificate") for 4,100,000 shares of Prime Stock, representing the aggregate number of shares of Prime Stock delivered to the Bern Owners under the Merger. The shares represented by the Escrow Certificate shall be held by the Escrow Agent for the benefit of the Indemnified Parties under this Agreement, and shall not, except as provided in Sections 4 and 11 hereof, be sold or disposed of by the Escrow Agent. Prime shall maintain a written record of the name and address of each Bern Owner and the number of shares of Escrowed Stock or Proportionate Share credited to his or her account. (Shares of Escrowed Stock shall be credited to the accounts of the Bern Owners in the same proportion as shares of Prime Stock were delivered to the Bern Owners under the Merger Agreement.)
(b) The respective interests of the Bern Owners in the Escrow Fund shall not be transferable or assignable other than (i) to executors, administrators, legatees or heirs of the Bern Owners or (ii) in a transaction involving no change in beneficial ownership. Any transfer pursuant to clause (ii) above shall be upon prior written notice from the Bern Owner(s) to Prime and the Escrow Agent, and no such transfer shall be valid without the consent of Prime, which consent shall not be unreasonably withheld or delayed.
(c) To the extent that the Escrow Fund contains cash, the Escrow Agent may invest such cash in any Treasury Bill issued by the United States having a maturity of 90 days or less.
4. Claims Against Escrow Fund.
Subject to the terms and conditions of this Agreement, the Escrow Fund shall be applied, as provided herein, to indemnify and hold harmless the Indemnified Parties against and
-5-
in respect of any Loss as set forth in a Claim Certificate (as defined below) duly delivered to the Escrow Agent and the Bern Owners prior to the Termination Date.
(a) If the Indemnified Parties shall suffer or incur any Loss as to which indemnification is provided for under the Indemnification Agreement, it shall promptly deliver simultaneously to the Escrow Agent and the Bern Owners a certificate (a "Claim Certificate"), which Claim Certificate shall be signed by the President or Chief Executive Officer of Prime or the Surviving Corporation, as the case may be, certifying to the effect that Prime and/or the Surviving Corporation, as the case may be, has suffered or incurred Losses in the amount specified in such Claim Certificate and the basis for any such Loss.
(b) Unless otherwise provided in Sections 4(c) and (d), Escrow Agent shall, as soon as practicable but not earlier than fifteen (15) business days after the delivery to the Escrow Agent of such Claim Certificate, pay to Prime and/or the Surviving Corporation, as the case may be, an amount of collateral from the Escrow Fund equal to the amount of any Loss so suffered or incurred by Prime and/or the Surviving Corporation, as the case may be, in accordance with the Claim Certificate (the "Payout"). Whenever the Escrow Agent is required to make a Payout, the Escrow Agent shall withdraw from the Escrow Fund and transfer, deliver and assign to Prime (i) first, any cash comprising the Escrow Fund, (ii) second, to the extent that there is insufficient cash to pay the Losses, shares of Prime Stock in accordance with the ratio of the original deposits of Prime Stock which comprise the Escrow Fund and (iii) third to the extent there is an insufficient number of shares of Prime Stock in the Escrow Fund to pay the Losses,any other property ("Other Property") comprising the Escrow Fund. For purposes hereof, shares of Prime Stock shall be valued in accordance with the terms of the Indemnification Agreement and Other Property, if any, shall be valued in good faith by the Prime Designees on the Board of Directors of Prime. The delivery by the Escrow Agent to Prime of the shares of
-6-
Prime Stock hereunder shall be effected by surrendering to Prime, or its transfer agent, of the Escrow Certificate then in the Escrow Agent's possession, whereupon Prime, or its transfer agent, shall promptly issue to the Escrow Agent a new stock certificate registered in its name for the number of shares of Prime Stock then remaining in the Escrow Fund as reduced by the number of shares surrendered to Prime.
(c) If, within ten (10) days after notice to the Bern Owners of any Claim Certificate, the Bern Owners who beneficially own a majority in interest of the Escrowed Stock then held in the Escrow Fund (the "Majority Owners") shall not have objected by written notice to Prime and the Escrow Agent, such Claim Certificate (the "Objection Notice"), such Claim Certificate shall constitute full authority to the Escrow Agent to take the action provided for in Section 4(b) hereof and shall be conclusive on all parties hereto. In the event that the Majority Owners shall object timely to any such Claim Certificate and the parties hereto shall fail to resolve the matter within three (3) business days from the date of the Objection Notice, then any such dispute shall be submitted to a court of competent jurisdiction for a declaratory judgment. Following any Objection Notice timely given, the Escrow Agent shall not assign any Escrowed Stock or make any indemnification payment pursuant to this Section 4 until (i) it receives the written consent of the Majority Owners and Prime or (ii) there is a Final Determination with respect to the dispute. The party against whom such declaratory judgment is actually rendered shall reimburse the other party thereto for the reasonable expenses incurred by it in the defense, prosecution, or investigation of such claim.
(d) Notwithstanding anything contained herein to the contrary, no Payout shall be made until any such Loss exceeds the Threshold Amount, whereupon any Payout shall be only to the extent that any Loss exceeds such Threshold Amount, in each case as specified in the Claim Certificate.
-7-
(e) If any dispute arises as to any matter arising under this Escrow Agreement or there arises any uncertainty as to the meaning or applicability of any of the provisions hereof, or as to the Escrow Agent's duties, rights or responsibilities hereunder, the Escrow Agent may, at it option at any time thereafter deposit the Escrowed Stock then being held by it in escrow into a court having appropriate jurisdiction, and the Escrow Agent shall thereby be discharged and relieved of all liability hereunder.
5. Termination. The Escrow Fund shall terminate on the Termination Date, or upon written notice from Prime and the Majority Owners to the Escrow Agent. Any shares or other assets then held in the Escrow Fund shall be distributed upon termination by the Escrow Agent in accordance with the provisions of Section 6 hereof. Notwithstanding the foregoing, if on or before the Termination Date any Indemnified Party has (a) duly delivered a Claim Certificate with respect to a claim which has not been satisfied pursuant to this Agreement or (b) delivered to the Escrow Agent and the Bern Owners written notice of the occurrence of an event which constitutes a breach of any representation, warranty or agreement made by Bern or the Bern Owners in the Merger Agreement and may give rise to a claim for indemnification under the Indemnification Agreement and this Agreement, and if such Indemnified Party has delivered to the Escrow Agent a good faith written estimate of the maximum potential amount of Losses resulting from all outstanding claim(s) or potential claim(s) (the "Estimated Loss"), the Escrow Fund shall not terminate with respect to such claims until all such claims have been fully satisfied or resolved or a Final Determination has been rendered with respect thereto. Until such termination, the Escrow Agent shall retain in the Escrow Fund that amount of Escrowed Stock, as valued and allocated in accordance with the Indemnification Agreement and this Agreement, equal to the Estimated Loss. In the event that the value of the shares of Prime Stock and other
...
View agreement details