Common use of Escrow Fund Clause in Contracts

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (Netiq Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowi) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, each of Purchaser, the Surviving Company, the Equityholder Representative and the Escrow Amount, without any act Agent shall enter into the Escrow Agreement. Purchaser shall deposit a stock certificate (issued in the name of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association the Equityholder Representative) reflecting the Escrow Shares (or other institution acceptable to Parent at the Closing) and the Shareholder RepresentativeEscrow Cash (on the Cash Transfer Date) as into escrow pursuant to the Escrow Agreement. The Escrow Agent shall hold the Escrow Shares and Escrow Cash and all interest, dividends and other amounts earned thereon not required to be distributed to the Stockholders or Optionholders pursuant to Section 2.17(a)(iii) (the “Escrow Agent”)collectively, such deposit to constitute an escrow fund (the “Escrow Fund”) in an escrow account (the “Escrow Account”) for purposes of securing any amounts payable by Stockholders and Optionholders under ARTICLE X and Sections 2.07 and 7.08 and certain other amounts payable hereunder in accordance with this Agreement and the Escrow Agreement. (ii) Any and all interest earned on cash in the Escrow Fund shall be added to the Escrow Fund and shall become a part thereof. (iii) Except as provided in Section 2.17(a)(v) below, cash dividends, and any non-cash taxable dividends or distributions, on any shares of Purchaser Common Stock in the Escrow Fund shall be distributed to the Stockholders according to their the respective Stock Percentages (defined below), and shall not become a part of the Escrow Fund, provided however that, to the extent aggregate amount of claims for payment under Sections 2.07 or 7.08 or indemnity claims asserted by the Purchaser Indemnitees in good faith pursuant to ARTICLE X exceed the amount then-remaining in the Escrow Fund, such dividends and distributions shall remain in the Escrow Fund and shall be treated as distributed to the Stockholders holding the applicable shares of Purchaser Common Stock according to their respective Stock Percentages for U.S. federal income tax purposes. Any shares of Purchaser Common Stock or other Equity Interests issued or distributed by Purchaser after the Effective Time in a nontaxable transaction (“New Shares”) in respect of Purchaser Common Stock in the Escrow Fund which have not been released from the Escrow Fund shall be added to the Escrow Fund and become a part thereof. The parties hereto agree that the Equityholder Representative, as agent for the Stockholders previously owning Stock Conversion Shares, is the record owner of any stock or other Equity Interests in the Escrow Fund for so long as such stock or Equity Interests remain in the Escrow Fund. Upon distribution to any Person (including the Stockholders) of any stock or Equity Interests in the Escrow Fund, the Equityholder Representative shall cause ownership of such stock or Equity Interests to be governed transferred to the distributee thereof. New Shares issued in respect of shares of Purchaser Common Stock which have been released from the Escrow Fund shall not be added to the Escrow Fund but shall be distributed to the record holders thereof. (iv) For tax reporting and withholding purposes, Equityholder Representative shall be treated as the owner of the cash in the Escrow Fund and shall be liable and responsible for any Taxes due with respect to income earned on such cash. Equityholder Representative shall be entitled to disbursements from the Escrow Amount in respect of Taxes paid by Equityholder Representative in respect of income earned on the terms Escrow Fund, as more particularly set forth hereinin the Escrow Agreement. The Escrow Agent may execute this Agreement following Upon the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature release of this Agreement as of the date hereof between the other signatories hereto. The any portion of the cash in the Escrow Amount contributed on behalf Fund to the Stockholders or Optionholders, a portion of each Shareholder such cash paid from the Escrow Fund shall be treated as provided interest under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty imputed interest rules of the Company contained in this Agreement, Code. (iiv) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language herein to the contrary, upon any reorganization, recapitalization, reclassification, consolidation, merger or Deemed Liquidation Event (as defined in Purchaser’s Fourth Amended and Restated Certificate of Incorporation, as in effect on the Parent may not receive any distribution from Closing Date) involving Purchaser in which the Purchaser Common Stock in the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals converted into or exceeds $25,000 and until an Officers’ Certificate identifying Lossesexchanged for securities, which in the aggregate exceed $1,000,000 cash or other property (the “Basket AmountExchange Property”), have been delivered then, following any such reorganization, recapitalization, reclassification, consolidation, merger or Deemed Liquidation Event, then, in lieu of such Purchaser Common Stock, there shall be deposited in the Escrow Fund the kind and amount of Exchange Property issuable upon conversion of such Purchaser Common Stock. (vi) The Letter of Transmittal and the Option Termination Agreement shall include a Form W-9 or original W-8 IRS tax form which shall be provided to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datedisbursement of interest and the Escrow Agent will file the appropriate 1099 or other required forms pursuant to Federal and State laws. A statement of citizenship will be provided if requested by Escrow Agent. Escrow Agent shall not be responsible for maximizing the yield on the Escrow Fund.

Appears in 1 contract

Sources: Merger Agreement (Teladoc, Inc.)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company's stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other an institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). No portion of the Escrow Amount shall be contributed in respect of any Company Options or warrants. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein (as modified by the Company Schedules), (ii) or any failure by the Company to perform or comply with any covenant contained in this Agreement, herein. The amount of any Losses shall be net of (a) any amount for which reimbursement is received by Parent or the Surviving Corporation pursuant to insurance policies or (iiib) any action, suit Tax benefit (or proceeding which is pending or threatened against decrese in Tax liabilities) attributable to such Losses. Parent and the Company as of each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Nothing herein shall have any right to contribution from limit the liability of the Company for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)250,000, have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case such case, Parent shall be entitled to may recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach Escrow Fund the total of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included its Losses in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach excess of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date$250,000.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Quickturn Design Systems Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders Closing each Shareholder will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect pursuant to the Escrow Amount) Agreement attached hereto as Exhibit C, without any act required on the part of any Shareholderthe Shareholders. As soon as practicable after the Effective TimeClosing, the Escrow Amount, without any act required on the part of any Shareholderthe Shareholders, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”)into an interest-bearing account, such deposit to constitute an escrow fund (the Escrow Fund”) Fund to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04at NEON's cost and expense. The Shareholders shall bear the tax for all interest attributable to the Escrow Account. The Escrow Fund shall be comprised entirely of the Escrow Amount. The Escrow Fund is available to indemnify and hold Parent compensate NEON and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) for any Losses incurred by ParentNEON, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty or covenant of the Company Shareholders, contained in this AgreementArticles II and III and VI herein, (ii) or any failure by the Company Shareholders to perform or comply with any covenant contained in this Agreement, or (iii) herein. NEON shall not be entitled to recover any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution amount from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds until its Losses exceed $25,000 and until an Officers’ Certificate identifying Losses, which 50,000 in the aggregate exceed $1,000,000 (the “Basket Amount”)aggregate, have been delivered to the Escrow Agent as provided in paragraph (e) below in at which case Parent shall be entitled to time NEON may recover all of its Losses including the Basket Amountfirst $50,000; provided, however, that any Loss resulting from the inaccuracy Losses incurred by NEON relating to any representation, warranty or breach of covenant related to Taxes set forth in Sections 2.10 and 6.7 or to Section 2.03(c), 4.05 2.3 or 6.20 Article III hereof shall not be recoverable from the first dollar and not subject to such minimum amount. NEON and the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent Shareholders each acknowledge that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentLosses, if any, would relate to unasserted contingent liabilities existing at the CompanyClosing, or any Subsidiary of which if resolved at the Company Closing would have led to a reduction in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Dateaggregate Purchase Price.

Appears in 1 contract

Sources: Share Acquisition Agreement (New Era of Networks Inc)

Escrow Fund. As security (a) There is hereby established a special fund, to be held by the Escrow Bank for the indemnity provided for in this Article 8 and by virtue benefit of this Agreementthe owners of the Bonds, the Shareholders will to be deemed to have received and deposited with the Escrow Agent (known as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund.” Upon the issuance of the 2024 Bonds, there shall be deposited into the Escrow Fund an amount equal to $ , derived from the proceeds of the 2024A Bonds and an amount equal to $ , derived from the proceeds of the 2024B Bonds. (b) The Escrow Bank shall invest $ of the moneys deposited into the Escrow Fund pursuant to the preceding paragraph in the securities set forth in Exhibit A attached hereto and by this reference incorporated herein (the “Escrowed Federal Securities”) to and shall hold the remaining $ in cash, uninvested. The Escrowed Federal Securities and such cash shall be governed deposited with and held by the terms Escrow Bank in the Escrow Fund solely for the uses and purposes set forth herein. If the Escrow Bank learns that the Department of the Treasury or the Bureau of Fiscal Service will not, for any reason, accept a subscription for U.S. Treasury Securities—State and Local Government Series, the Escrow Bank shall promptly request alternative written investment instructions from the Successor Agency with respect to escrowed funds which were to be invested in the Escrowed Federal Securities. The Escrow Agent may execute this Agreement following Bank shall follow such instructions and, upon the date hereofmaturity of any such alternative investment, the Escrow Bank shall hold funds uninvested and such later execution, if so executed after without liability for interest until receipt of further written instructions from the date hereof, Successor Agency. In the absence of investment instructions from the Successor Agency the Escrow Bank shall not affect be responsible for the binding nature investment of this Agreement such funds or interest thereon. The Escrow Bank may conclusively rely upon the Successor Agency’s selection of an alternative investment as a determination of the date hereof between alternative investment's legality and suitability and shall not be liable for any losses related to the other signatories hereto. alternative investments or for compliance with any yield restriction applicable thereto. (c) The portion Escrow Bank may rely upon the conclusion of the Escrow Amount contributed on behalf of each Shareholder shall be , as provided under Section 2.04. The Shareholders shall indemnify contained in its opinion and hold Parent and its officers, directors and affiliates accompanying schedules (the “Indemnified PartiesReport”) harmless against all claimsdated December , losses2024, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including that the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrarymaturing Escrowed Federal Securities, the Parent may not receive any distribution from investment earning thereon and the cash on deposit in the Escrow Fund will be sufficient to redeem the 2014 Bonds in respect full on the Redemption Date at the Redemption Price. (d) The Escrow Bank shall not be liable or responsible for any loss resulting from its full compliance with the provisions of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which Escrow Agreement. (e) Any money left on deposit in the aggregate exceed $1,000,000 (Escrow Fund after payment in full of the “Basket Amount”)2014 Bonds, have been delivered and the payment of all amounts due to the Escrow Agent as provided in paragraph (e) below in which case Parent Bank hereunder, shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject transferred to the Basket Amount nor shall it be included 2024 Trustee for deposit in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from Revenue Fund maintained by the inaccuracy or breach of Section 4.26 shall be reduced 2024 Trustee pursuant to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date2024 Indenture.

Appears in 1 contract

Sources: Escrow Agreement

Escrow Fund. As security for Prior to the indemnity provided for in this Article 8 and by virtue of this AgreementClosing, the Shareholders will be deemed to have received Sellers’ Representatives, on behalf of all of the Company Securityholders, and deposited the Purchaser shall enter into an Escrow Agreement (the “Escrow Agreement”) with Citibank, N.A.(or if such Person declines, such other U.S. commercial bank based in New York, New York selected by the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect Purchaser and reasonably acceptable to the Escrow AmountSellers’ Representatives) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”)) substantially in the form of Exhibit 2.03 attached hereto. Pursuant to the terms of the Escrow Agreement, such at the Closing the Purchaser shall deposit to constitute an into the escrow fund account (the “Escrow FundAccount”) to be governed held by the Escrow Agent in accordance with the terms set forth hereinof the Escrow Agreement the amount of cash equal to $6,464,427 (the “Escrow Amount”). The Escrow Agent may execute this Agreement following Amount shall be available to compensate the date hereof, Purchaser and such later execution, if so executed after other Purchaser Indemnified Parties for Losses in accordance with the date hereof, shall not affect indemnification obligations of the binding nature Sellers under Article IX of this Agreement as and in accordance with the terms of the date hereof between Escrow Agreement. The Purchaser shall be entitled to deduct from any payments due to a Seller or a holder of Company Share Options at the other signatories heretoClosing pursuant to this Agreement the Per Share Escrow Amount in respect of each Ordinary Share, with the aggregate amount to be deducted from each Seller or holder of Company Share Options to be rounded to nearest whole cent. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Securityholder shall be in proportion to the number of Ordinary Shares held by such Company Securityholder immediately prior to the Closing, assuming the exercise of all outstanding Company Share Options as provided under Section 2.04of immediately prior to the Closing (such proportion being such Company Securityholder’s “Pro Rata Share”), and shall be deemed held in a separate escrow sub-account for the benefit of such Company Securityholder. The Shareholders portion thereof held in any Company Securityholder’s individual sub-account shall only be available to compensate the Purchaser and the other Purchaser Indemnified Parties for Losses for which such Company Securityholder is obligated to indemnify the Purchaser Indemnified Parties hereunder, and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company not for any claim made Losses indemnifiable by Parent after the Effective Timeany other Company Securityholder. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution Distributions from the Escrow Fund in respect Account shall be governed by the terms and conditions of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateAgreement.

Appears in 1 contract

Sources: Share Purchase Agreement (Iis Intelligent Information Systems LTD)

Escrow Fund. As security for Prior to or simultaneously with the indemnity provided for ----------- Closing, the Stockholders' Representative and Parent shall enter into an escrow agreement (the "Escrow Agreement") with an escrow agent selected by Parent and ---------------- reasonably acceptable to the Stockholders' Representative (the "Escrow Agent"), ------------ substantially in this Article 8 and by virtue the form of this Exhibit C hereto. Pursuant to the terms of the ---------------- Escrow Agreement, at the Shareholders Closing, Parent shall deposit one or more certificates representing, in the aggregate, the Escrow Shares to be deposited by each holder of Company Stock into an escrow account, which account is to be managed by the Escrow Agent (the "Escrow Account"). Any Escrow Shares in the Escrow Account are -------------- referred to herein as the "Escrow Fund." In connection with such deposit of the ----------- Escrow Shares with the Escrow Agent and as of the Effective Time, each holder of Company Stock will be deemed to have received and deposited with the Escrow Agent (as defined below) each stockholder's pro rata interest in the Escrow Amount Fund as determined as of Closing by reference to such stockholder's ownership of shares of Company Stock (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to shares constituting the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow AmountFund), without any act of any Shareholder, will be deposited with J.▇stockholder of the Company. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and Distributions of any Escrow Shares from the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to Account shall be governed by the terms set forth hereinand conditions of the Escrow Agreement. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature adoption of this Agreement as and the approval of the date hereof between Merger by the other signatories hereto. The portion stockholders of the Company (the "Company Stockholders") shall constitute ------- ------------ approval of the Escrow Amount contributed on behalf Agreement and of each Shareholder all the arrangements relating thereto, including, without limitation, the placement of the Escrow Shares in escrow and the appointment of the Stockholders' Representative. No Escrow Shares shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund contributed in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount Company Option or any other security exercisable or convertible into Company Stock. The percentage of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered Parent Shares contributed to the Escrow Agent as provided Fund with respect to each holder of Company Stock that are unvested or subject to any right of repurchase, risk of forfeiture or other condition in paragraph (e) below in which case Parent favor of the Surviving Corporation shall be entitled proportional to recover all Losses including the Basket Amountpercentage of such holder's Company Stock that are unvested or subject to any right of repurchase, risk of forfeiture or other condition in favor of the Company; provided, however, that any Loss resulting payments due to Parent from the inaccuracy Escrow Fund -------- ------- shall first be satisfied by delivering to Parent, to the extent available, with respect to each holder of Company Stock, such Escrow Shares that are fully vested or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and otherwise not subject to the Basket Amount nor shall it be included any right of repurchase, risk of forfeiture or other restriction in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary favor of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateSurviving Corporation.

Appears in 1 contract

Sources: Merger Agreement (Cacheflow Inc)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeClosing, the Escrow AmountShares shall be registered in the name of, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ Trust Companywith, Fidelity National Association Bank (or other institution acceptable agreeable to Parent both PURCHASER and the Shareholder RepresentativeTARGET) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit and any Additional Escrow Shares to constitute an escrow fund (the Escrow Fund”) Fund and to be governed by the terms set forth hereinherein and in the Escrow Agreement in substantially the form attached hereto as Exhibit 4. The Escrow Agent may execute this Agreement following Fund shall be available to compensate PURCHASER pursuant to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as indemnification obligations of the date hereof between Warranting Stockholders. In the other signatories hereto. The portion event PURCHASER issues any Additional Escrow Shares (as defined below), such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Escrow Shares delivered at the Closing. (b) Except for dividends paid in paragraph stock declared with respect to the Escrow Shares (e) below in "Additional Escrow Shares"), which case Parent shall be entitled treated as Escrow Shares pursuant to recover all Losses including the Basket Amount; providedSection 11.1(a) hereof, howeverany cash dividends, that dividends payable in securities or other distributions of any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company kind made in respect of any taxable year (or portion thereof) ending on or prior the Escrow Shares will be delivered to the Expiration DateWarranting Stockholders based on each such Warranting Stockholder's Proportional Allotment. Each Warranting Stockholder shall have voting rights with respect to the Escrow Shares deposited in the Escrow Fund with respect to such stockholder's Proportional Allotment so long as such Escrow Shares are held in escrow, and PURCHASER will take all reasonable steps necessary to allow the exercise of such rights. While the Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement and the Escrow Agreement, the Warranting Stockholders shall retain and shall be able to exercise all other incidents of ownership of such Escrow Shares which are not inconsistent with the terms and conditions of this Agreement.

Appears in 1 contract

Sources: Merger Agreement (Brainworks Ventures Inc)

Escrow Fund. (a) As security for soon as reasonably practicable following the indemnity provided for Closing, but in this Article 8 and no event later than one (1) Business Day following the Closing, Parent shall, or shall cause the Paying Agent to, transfer, by virtue wire transfer of this Agreementimmediately available funds, the Shareholders will be deemed Escrow Amount to have received and deposited with the Escrow Agent (to hold in trust as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by under the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as and the Escrow Agreement. (b) The Escrow Agreement shall be entered into at or prior to the Closing, by and among Parent, the Securityholder Representative, on behalf of the date hereof between Company Indemnitors, and the other signatories heretoEscrow Agent, and shall provide Parent with recourse against the Escrow Fund with respect to (i) any Post-Closing Deficit Amount under Section 1.15 and (ii) the Company Indemnitors’ obligations under Article VII during the period through the Escrow Expiration Date. The portion proceeds in the Escrow Fund shall be distributed to the Company Indemnitors, in accordance with their applicable Pro Rata Shares, and to Parent at the times, and upon the terms and conditions, set forth in this Agreement and the Escrow Agreement. The terms and provisions of the Escrow Agreement and the transactions contemplated thereby are specific terms of the Merger, and the approval and adoption of this Agreement and approval of the Merger by the Company Indemnitors constitutes approval by such Company Indemnitors, as specific terms of the Merger, and the irrevocable agreement of such Company Indemnitors to be bound by and comply with, the Escrow Agreement and all of the arrangements and provisions of this Agreement relating thereto, including the deposit of the Escrow Amount contributed into the Escrow Fund, the obligations set forth in Article VII and the appointment and sole authority of the Securityholder Representative to act on behalf of each Shareholder the Company Indemnitors, as provided for herein and in the Escrow Agreement. The Escrow Amount shall be held as provided under Section 2.04. The Shareholders a trust fund and shall indemnify not be subject to any Lien, attachment, trustee process or any other judicial process of any creditor of any party, and hold Parent shall be held and its officers, directors disbursed solely for the purposes and affiliates in accordance with the terms of this Agreement and the Escrow Agreement. (the “Indemnified Parties”c) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of Entity and the Securityholder Representative agree for all Tax purposes that: (i) any inaccuracy or breach of a representation or warranty Parent shall be treated as the owner of the Company contained in this AgreementEscrow Cash for Tax purposes, and all interest and earnings earned from the investment and reinvestment of the Escrow Cash, or any portion thereof, shall be allocable for Tax purposes to Parent, and (ii) any failure by within ten (10) days after the end of each calendar quarter and immediately prior to the final distribution of the Escrow Amount to the Company to perform or comply with any covenant contained in this AgreementSecurityholders, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover a distribution equal to thirty percent (30%) of all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar interest and not subject earnings allocated to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that Parent for Tax purposes for such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (calendar quarter or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (PagerDuty, Inc.)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company Stockholders will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act required on the party of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, Parent will deposit the Escrow Amount, without any act of any Shareholder, will be deposited Amount with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth hereinherein and at Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Company Stockholder entitled to receive Merger Shares or Merger Cash shall be determined with reference to the Pro Rata Portion of each such Company Stockholder. The Escrow Fund is available to compensate Parent and its officers, directors and affiliates, including the Surviving Corporation (each, an "INDEMNIFIED PARTY" and collectively, the "INDEMNIFIED PARTIES") for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defenses (hereinafter individually a "LOSS" and collectively "LOSSES") paid, incurred, accrued or sustained by the Indemnified Parties, or any of them, directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in Article II herein as of the date of this Agreement or as of the Closing Date, as though then made (except to the extent that such representation or warranty speaks as of an earlier date), (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement or (iii) any claim made by any person that such person is or was entitled (by contract or otherwise) to receive any amount or property in such person's capacity (or asserted capacity) as a holder of equity interests in the Company or contingent equity interests or as a beneficiary of any rights in excess of the consideration set forth in this Agreement by virtue of or as a result of the Merger; provided, however, that there shall be no liability under this Section 7.2 unless the aggregate of all Losses exceeds One Hundred Thousand Dollars ($100,000) (the "AGGREGATE THRESHOLD"); provided, further, however, that in the event the entire amount of any Losses accrued exceeds the Aggregate Threshold, such entire amount may be recovered from the Escrow Fund. Parent, Merger Sub and the Company each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger Consideration Value. Nothing herein shall limit the liability of the Company for any breach of any representation, warranty or covenant if the Merger does not close. (i) For the purpose of this Article VII only, when determining the amount of any Loss resulting from such inaccuracy or any breach of a representation or warranty of the Company contained in Article II hereof, any such representation or warranty of the Company that is qualified in scope as to materiality (including Material Adverse Effect) shall be deemed to be made or given without such qualification. There shall be no right of contribution from any Indemnified Party with respect to any Loss. The Escrow Agent may execute this the Escrow Agreement following the date hereofhereof and prior to the Closing, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (Carrier Access Corp)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders each Stockholder will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect Shares pursuant to the Escrow Amount) Agreement, without any act required on the part of any Shareholderthe Stockholder. As soon as practicable after the Effective Time, the Escrow AmountShares, without any act required on the part of any ShareholderStockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent Purchaser and the Shareholder RepresentativeRepresentative (as defined below) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Stockholder shall be as provided in proportion to the aggregate Purchaser Common Stock which such holder would otherwise be entitled to receive under Section 2.043.1, which respective percentage interest (the "Percentage Interest") will be determined as of the Effective Time and set forth on an exhibit to the Escrow Agreement. The Shareholders Escrow Fund shall be contributed entirely out of the shares of Purchaser Common Stock issuable upon the Merger in respect of GNN Capital Stock. From and after the Effective Time, the Escrow Fund shall be available to compensate and indemnify Purchaser and hold Parent the Surviving Corporation and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its their respective officers, directors, employees, representatives, agents, stockholders controlling persons and Affiliates (each a "Purchaser Indemnitee") against and for any Loss suffered or affiliates (including the Surviving Corporation) directly incurred by a Purchaser Indemnitee, as and when due, which arises out of or indirectly as results from a result of (i) any inaccuracy or breach of a representation or warranty any of the Company contained representations, warranties, covenants or agreements of GNN set forth in this Agreement or in any document delivered by GNN pursuant to this Agreement; provided, however, that for purposes of determining whether or not GNN has breached any of its representations and warranties in this Agreement, (ii) any failure by the Company to perform exceptions and qualifications for Material, Materiality or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective TimeMaterial Adverse Effect and similar expressions shall be disregarded. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent A Purchaser Indemnitee may not receive any distribution shares from the Escrow Fund in respect of any unless and until a Loss subject to indemnification pursuant to this Article 8 unless Notice or Loss Notices (as defined below) identifying Indemnifiable Losses, the aggregate amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), 500,000 have been delivered to the Escrow Agent as provided pursuant to the terms hereof; in paragraph (e) below in which case Parent shall be entitled to such case, an Indemnitee may recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach Escrow Fund its Losses in excess of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from $500,000 in accordance with the first dollar terms and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach provisions of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datethis Article 14.

Appears in 1 contract

Sources: Merger Agreement (Healtheon Corp)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's stockholders will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to and less any shares that may be deposited therewith by the Escrow Amount) participants in the Management Incentive Compensation Plan), without any act required on the part of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act required on the part of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent and the Shareholder RepresentativeStockholder Representative (as defined in Section 7.2(i)(i) below) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount (less the value of any shares that may be deposited into the Escrow Fund by the participants in the Management Incentive Compensation Plan) contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock to which such holder would otherwise be entitled under Section 2.041.6(b). The Shareholders Escrow Amount shall indemnify be funded entirely out of (i) the shares of Parent Common Stock issuable upon the Merger in respect of Company Capital Stock and hold (ii) the shares of Parent Common Stock issuable to the participants in the Management Incentive Compensation Plan pursuant thereto. The Escrow Fund is available to compensate Parent and its officers, directors and affiliates affiliates, including the Surviving Corporation (any, an "INDEMNIFIED PARTY" and collectively, the “Indemnified Parties”) harmless against all "INDEMNIFIED PARTIES"), for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defenses (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directorsthe Indemnified Parties, or affiliates (including the Surviving Corporation) any of them, directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreementherein, or (iii) any actionDissenting Share Payments, suit or proceeding which (iv) any claim made by any person that such person is pending or threatened against was entitled (by contract or otherwise) to receive any amount or property in such person's capacity (or asserted capacity) as a holder of equity interests in the Company or contingent equity interests or as a beneficiary of any rights in excess of the consideration set forth in the Merger Agreement by virtue of or as a result of the Merger, other than any claim described in clause (iii) above. Parent and the Company each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Nothing herein shall have any right to contribution from limit the liability of the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect breach of any Loss subject to indemnification pursuant to this Article 8 unless representation, warranty or covenant if the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and Merger does not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Dateclose."

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Edwards J D & Co)

Escrow Fund. (a) As sole security for the indemnity provided for in this Article 8 and by virtue Section 9.2 of this Agreement, the Shareholders will Escrow Shares (defined in Section 2.3 hereof) shall be deemed to have received and deposited with registered in the Escrow Agent (as defined below) names of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will Indemnifying Holders but shall be deposited (together with J.▇. ▇▇▇▇▇▇ assignments in blank executed by the Indemnifying Holders) with Chase Manhattan Trust Company, National Association (or other institution acceptable to Parent and selected by SAFLINK with the Shareholder reasonable consent of the Holders' Representative) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit to constitute an escrow fund ("the Escrow Fund") to be governed by the terms set forth herein. The herein and in an Escrow Agreement among SAFLINK, the Escrow Agent may execute and the Indemnifying Holders (the "Escrow Agreement") substantially in the form attached hereto as Exhibit 7.1(i). Subject to the terms of Section 9.3(b) of this Agreement, SAFLINK's compliance with the terms hereof and the terms of the Escrow Agreement following the date hereof, and such later execution, if so executed after SAFLINK Indemnitees shall be entitled to obtain indemnification from the date hereof, shall not affect Escrow Fund for all Indemnifiable Damages covered by the binding nature indemnity provided for in Section 9.2 of this Agreement as of (it being understood that each Jotter Indemnitor's liability under this Agreement shall be limited to the date hereof between the other signatories heretoEscrow Fund). The portion adoption and approval of this Agreement by Jotter's shareholders shall constitute approval of the Escrow Amount contributed Agreement and of all of the arrangements relating thereto, including without limitation the placement of the Escrow Shares in escrow, and the appointment of the Holders' Representative to act for and on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementIndemnifying Holders, (ii) as the attorney-in-fact and agent of such persons, to give and receive notices and communications, to authorize delivery of any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as shares of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution SAFLINK Common Stock from the Escrow Fund in satisfaction of claims by SAFLINK Indemnitees, to object to such deliveries, to agree to, negotiate and enter into settlements and compromises of, and comply with orders and decrees with respect to such claims, and to take all actions necessary or appropriate in the judgment of such representative for the accomplishment of the foregoing. A decision, act, consent or instruction of the Holders' Representative shall constitute a decision of all of the Indemnifying Holders and shall be final, binding and conclusive upon each of the Indemnifying Holders. The Escrow Agent, SAFLINK and Acquisition Corporation may rely upon any Loss subject decision, act, consent or instruction of the Holders' Representative as being the decision, act, consent or instruction of each and all of the Signing Holders. The Escrow Agent and SAFLINK and Acquisition Corporation are hereby relieved from any liability to any person for any acts done by them in accordance with such decision, act, consent or instruction of the Holders' Representation. (b) At any time until the earlier of the expiration of the Escrow Period or the termination of the Escrow Agreement as provided therein, if any SAFLINK Indemnitee makes a claim for Indemnifiable Damages and is entitled to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying LossesSection 9.2 hereof, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided shall, upon compliance with the procedures set forth in paragraph the Escrow Agreement, release to SAFLINK (eor other applicable SAFLINK Indemnitee) below such amount from the Escrow Fund which is equal in which case Parent value to such Indemnifiable Damages. Escrow Shares so released shall be entitled valued at the closing price on the Closing Date of the SAFLINK Common Stock, as reported by the Nasdaq SmallCap Market. Upon a distribution by the Escrow Agent to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy SAFLINK (or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject other applicable SAFLINK Indemnitee) pursuant to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parentthis Section, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Fund will be correspondingly reduced.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization and Merger (Saflink Corp)

Escrow Fund. As security for At the indemnity provided for in this Article 8 Effective Time, each holder of shares of Company Capital Stock (each, a "COMPANY STOCKHOLDER" and by virtue of this Agreementcollectively, the Shareholders "COMPANY STOCKHOLDERS") will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to shares constituting the Escrow Amount) ), without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ U.S. Bank Trust Company, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoto be maintained at Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Stockholder shall be as provided in proportion to the aggregate Parent Common to which such holder would otherwise be entitled under Section 2.041.6(a) and shall be in the respective amounts listed opposite each Company Stockholder's name listed in a schedule to be executed by the Company and delivered to Parent at Closing (the "ESCROW SCHEDULE"). No shares of Parent Common contributed to the Escrow Fund may be unvested or subject to any right of repurchase, risk of forfeiture, or other condition in favor of Parent or the Surviving Corporation; PROVIDED, HOWEVER, that to the extent a Company Stockholder does not hold shares that are vested or free of a right of repurchase, risk of forfeiture, or other condition, the shares of Parent Common to be deposited in the Escrow Fund on behalf of such Company Stockholder shall be the first shares of Parent Common scheduled to vest or to be released from such rights, risks, or conditions. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (including the “Indemnified Parties”Surviving Corporation) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained herein (or in any certificate, instrument, schedule or document delivered by the Company in connection with this Agreement, Agreement or the Merger) or (ii) any failure by the Company to perform or comply with any covenant or agreement contained herein; PROVIDED, HOWEVER, that claims arising out of an inaccuracy or breach of any representation or warranty or any covenant or agreement of the Company contained in this AgreementAgreement or in any certificate, instrument, schedule or (iii) any action, suit or proceeding which is pending or threatened against document delivered by the Company as at the Closing in connection with this Agreement or the Merger must be asserted on or before 5:00 p.m. (California Time) on the date that is one year following the Closing Date (the "EXPIRATION DATE"). No portion of the Effective TimeEscrow Amount shall be contributed in respect of any Company Options. No Shareholder shall have any right to contribution from the Company Except for any claim made by Parent after the Effective Time. Notwithstanding anything Excess Third Party Expenses (as defined in the preceding language to the contrarySection 9.2), the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)150,000, have been delivered to the Escrow Agent as provided in paragraph (e) below d), and either there is no objection thereto or any objection has been resolved in which case accordance with the provisions of this Article VII; in such case, Parent shall be entitled to may recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c)Escrow Fund all Losses, 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject without regard to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided$150,000 threshold, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, for which there is no objection or any Subsidiary objection has been resolved in accordance with the provisions of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datethis Article VII.

Appears in 1 contract

Sources: Merger Agreement (Peregrine Systems Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeAECsoft USA Closing Date, Buyer shall deposit the Escrow Amount, without any act of any Shareholder, will be deposited Amount with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereinherein and the Escrow Agreement. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under available to satisfy any qualifying indemnification claims pursuant to Section 2.047.02. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (Buyer agree that claims against the Escrow Fund are not the exclusive remedy of Buyer or any Buyer Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in Party under this Agreement, (ii) except that claims against the Escrow Fund and offsets against the Earnout Payments shall be the exclusive remedy for indemnification claims arising from any failure inaccuracy in any representations or warranties that do not constitute Fundamental Representations. Other than in the case of fraud or willful breach or intentional misrepresentation, Indemnifiable Damages asserted by the Company Buyer Indemnified Parties pursuant to perform Section 7.02 shall be satisfied first by offsetting the amount of such Indemnifiable Damages against any Earnout Payment that has been finally determined to be payable pursuant to Section 1.02(c) and second, if no such Earnout Payment is then payable pursuant to Section 1.02(c) or comply with any covenant contained in this Agreementsuch Earnout Payment is insufficient to fully satisfy such Indemnifiable Damages, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect accordance with the terms of any Loss subject the Escrow Agreement. The Shareholders obligation to satisfy indemnification claims by the Buyer Indemnified Parties pursuant to this Article 8 unless Section 7.02 shall be limited to offsets of the Earnout Payments and distributions from the Escrow Fund until such time as claims have been asserted by Buyer Indemnified Parties for aggregate Indemnifiable Damages in excess of the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (Escrow Fund then held by the “Basket Amount”), have been delivered Escrow Agent pursuant to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateAgreement.

Appears in 1 contract

Sources: Stock Purchase Agreement (Sciquest Inc)

Escrow Fund. As security for On the indemnity provided for in this Article 8 Closing Date, Parent shall deliver to the Escrow Agent the Escrow Amount and by virtue of this Agreementon the Earn-Out Payment Date, Parent shall deliver to the Shareholders will be deemed to have received Escrow Agent the Contingent Escrow (together with the Escrow Amount and any amounts deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect Closing date pursuant to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”Section 2.16(f)(iii), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein). The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, Fund shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of be held by the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (Agent for the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result purposes of (i) providing security for any inaccuracy or breach of a representation or warranty adjustment to the amount of the Company contained in this AgreementMerger Consideration pursuant to Section 2.16, (ii) providing security for any failure by liability for Taxes arising from the Company to perform or comply with any covenant contained in this Agreement, or Audit Notice; and (iii) any action, suit or proceeding which is pending or threatened against securing and initially paying the indemnification obligations of the Company Indemnitors set forth in Article 9. The Escrow Fund shall be held by the Escrow Agent as a trust fund and shall not be subject to any Lien, attachment, trustee process or any other judicial process of any creditor of any party, and shall be held and disbursed solely for the purposes and in accordance with the terms of the Escrow Agreement and the following terms: (i) Within ten (10) days of the Audit Completion Date, the Parties shall deliver joint written instructions signed by Parent and the Representative, directing the Escrow Agent to release by wire transfer or otherwise distribute, from the then remaining Escrow Fund, an amount equal to $1,000,000 to: (i) Parent to the extent, if at all, the Surviving Corporation incurs any Tax liability arising from the Audit Notice as of the Effective TimeAudit Completion Date and (ii) the balance to the Exchange Agent to be distributed to the Applicable Holders. No Shareholder For avoidance of doubt, Article 7 shall have any right govern the control of the Tax audit contemplated by the Audit Notice. (ii) The Parties shall deliver joint written instructions signed by Parent and the Representative promptly after the date 18 months following the Closing Date (the “Scheduled Distribution Date”), directing the Escrow Agent to contribution release by wire transfer or otherwise distribute, from the Company for any claim made by Parent after then remaining Escrow Fund, an amount equal to (i) the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from remaining balance of the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless Fund, less (ii) the amount of any all Unresolved Claims as of the Scheduled Distribution Date, it being understood that if the foregoing calculation results in a negative amount, Parent and the Representative shall jointly instruct the Escrow Agent to make no distribution (such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Lossesamount, which in the aggregate exceed $1,000,000 (the “Basket Distribution Amount”), have in accordance with this Section 2.17(a)(i). “Unresolved Claims” means, as of a specified date, the aggregate amount of all indemnification claims that are the subject of a Direct Claim or a Third Party Action, or that are otherwise unsatisfied as of such date, including any indemnification claims for which a notice of a Direct Claim or a Third Party Action has been delivered but for which the 30-day dispute period has not expired as of such date plus $1,000,000 if the Audit Completion Date has not yet occured. Any payment under this Section 2.17(a)(i) shall be by wire transfer of a cash amount equal to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; providedpayment amount, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject pursuant to the Basket Amount nor shall it be included wire instructions set forth in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Agreement.

Appears in 1 contract

Sources: Merger Agreement (ZAGG Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's shareholders will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect Time) pursuant to the Escrow Amount) Agreement attached hereto as Exhibit H, without any act required on the part of any Shareholdershareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act required on the part of any Shareholdershareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(h)(i) below) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder shareholder of the Company shall be as provided in proportion to the aggregate Parent Common Shares which such holder would otherwise be entitled under Section 2.041.6(a). The Shareholders Escrow Amount shall indemnify and hold be contributed entirely out of the shares of Parent Common Shares issuable upon the Merger in respect of Company Common Stock. The Escrow Fund shall be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein (as modified by the Company Schedules), (ii) or any failure by the Company to perform or comply with any covenant contained in this Agreementherein; provided, or (iii) any actionhowever, suit or proceeding which is pending or threatened against that the Escrow Fund shall not be available after the date of the first audit of financial statements containing combined operations of Parent and the Company as of for those contingencies that would be expected to be encountered in the audit process. Parent and the Company each acknowledge that such Losses, if any, would relate to unasserted contingent liabilities existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Subject to Section 8.5 below, nothing herein shall have any right to contribution from limit the liability of the Company for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)300,000, have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case such case, Parent shall be entitled to may recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach Escrow Fund its Losses in excess of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date$300,000.

Appears in 1 contract

Sources: Merger Agreement (Baan Co N V)

Escrow Fund. As security for Prior to or simultaneously with the indemnity provided for Closing, Ositis and Parent shall enter into a Stock Escrow Agreement and a Cash Escrow Agreement (together, the “Escrow Agreements”) with an escrow agent selected by Parent and reasonably acceptable to Ositis (the “Escrow Agent”) substantially in this Article 8 the forms of Exhibit C and Exhibit C-1 hereto. Pursuant to the terms of the Escrow Agreements, Parent shall deposit (i) one or more certificates in the name of the Escrow Agent representing the Escrow Shares into an escrow account and (ii) the Escrow Cash into an escrow account, which account or accounts are to be managed by virtue the Escrow Agent (the escrow accounts collectively referred to as the “Escrow Account”). Any Escrow Shares and Escrow Cash in the Escrow Account are referred to herein as the “Escrow Fund”. The deposit of the Escrow Shares and Escrow Cash in the Escrow Account will occur at such times and in such amounts as is set forth in the second paragraph of this AgreementSection 2.02(b) and in the Escrow Agreements. In connection with such deposits of the Escrow Shares and Escrow Cash with the Escrow Agent and as of the time of each such deposit, the Shareholders Ositis will be deemed to have received and deposited with the Escrow Agent (as defined below) the such Escrow Amount Shares and Escrow Cash (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to shares comprising part of the Escrow AmountFund) without any act of Ositis. Distributions of any Shareholder. As soon as practicable after the Effective Time, Escrow Shares or Escrow Cash from the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to Account shall be governed by the terms set forth hereinand conditions of the Escrow Agreements. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature approval of this Agreement as and the Merger by Ositis shall constitute approval of the date hereof between Escrow Agreements and of all the other signatories heretoarrangements relating thereto, including, without limitation, the placement of the Escrow Shares and Escrow Cash in escrow. The No portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be contributed in respect of any Company Option (as provided under defined in Section 2.042.04(a)) or any warrant or other security exercisable or convertible into Company Stock. The Shareholders Escrow Shares and Escrow Cash shall indemnify consist exclusively of Parent Shares and hold Parent Cash otherwise payable to Ositis pursuant to Section 2.09. The Escrow Shares and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained Escrow Cash shall be deposited in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect three equal installments on each of any Loss subject the days that are six months, nine months and twelve months following the Closing Date, and shall consist exclusively of Parent Shares and Cash that, on the date set for such deposit, constitute part of the Deferred Payment that is otherwise payable by Parent to indemnification Ositis pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountSection 2.09; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof such deposit shall be recoverable from made only if Ositis remains employed by Parent or any of its direct or indirect wholly owned subsidiaries on the first dollar and not subject to date set for such deposit or otherwise receives payment of the Basket Amount nor shall it be included in calculating whether applicable portion of the Basket Amount has otherwise been exceededDeferred Payment; and provided, further, provided further that if Ositis receives any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary portion of the Company in respect of any taxable year (or portion thereof) ending on or Deferred Payment prior to the Expiration days that are six months, nine months and twelve months following the Closing Date, then, upon any such receipt, the portion of the Deferred Payment received by Ositis that constitutes Escrow Shares and Escrow Cash shall be deposited immediately into the Escrow Fund.

Appears in 1 contract

Sources: Merger Agreement (Blue Coat Systems Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement(a) Prior to any amount being distributed to any Company Holder pursuant to Section 2.6, the Shareholders Escrow Fund will be deemed to have received withheld from the Merger Consideration and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion Indemnity Portion of the Escrow Amount contributed on behalf Fund will be held for the purpose of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (securing the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty indemnification obligations of the Company contained set forth in this Agreement, (iiAgreement and the obligations pursuant to Section 2.13(d) any failure by and Section 7.5. The Adjustment Portion of the Escrow Fund will be held for the purpose of securing the obligations of the Company to perform or comply Holders set forth in Section 2.13 of this Agreement. The Stockholders’ Agent Expense Portion of the Escrow Fund will be held for the purpose of funding any expenses of the Stockholders’ Agent arising in connection with any covenant contained the administration of the Stockholders’ Agent’s duties in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent Agreement after the Effective Time. Notwithstanding anything in The Escrow Fund will be withheld from the preceding language aggregate amount of Merger Consideration otherwise payable to each Company Holder pursuant to Section 2.6, with the contraryamount withheld equal to such Company Holder’s Company Holder Percentage Interest of the aggregate amount of Merger Consideration otherwise payable to such Company Holder pursuant to Section 2.6. The Escrow Agreement will provide for (i) the release, subject to a reserve for pending claims, of the Parent may not receive any distribution from Indemnity Portion of the Escrow Fund remaining in respect the escrow account within five (5) Business Days after the eighteen (18)-month anniversary of the Closing Date, (ii) the release of the Adjustment Portion of the Escrow Fund upon Final Merger Consideration being finally determined pursuant to Section 2.13, and (iii) the release of the Stockholders’ Agent Expense Portion of the Escrow Fund upon receipt of written notice from the Stockholders’ Agent. Upon the release and distribution to the Company Holders of any Loss subject to indemnification pursuant to this Article 8 unless the amount portion of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent Fund, each Company Holder shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject receive an amount equal to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary portion of the Escrow Fund being released and distributed multiplied by the such Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateHolder’s Company Holder Percentage Interest.

Appears in 1 contract

Sources: Merger Agreement (Best Buy Co Inc)

Escrow Fund. As security for Prior to or simultaneously with the indemnity provided for Closing, ----------- the Stockholders' Representative and Parent shall enter into an escrow agreement (the "Escrow Agreement") with an escrow agent selected by Parent and reasonably ---------------- acceptable to the Stockholders' Representative (the "Escrow Agent") ------------ substantially in this Article 8 and by virtue the form of this Exhibit B hereto. Pursuant to the terms of the --------- Escrow Agreement, within 20 days after the Shareholders Closing, Parent shall deposit one or more certificates representing, in the aggregate, the Escrow Shares into an escrow account, which account is to be managed by the Escrow Agent (the "Escrow ------ Account"). Any Escrow Shares in the Escrow Account are referred to herein as the ------- "Escrow Fund". In connection with such deposit of the Escrow Shares with the ----------- Escrow Agent and as of the Effective Time, each holder of Company Common Stock will be deemed to have received and deposited with the Escrow Agent (as defined below) each stockholder's pro rata interest in the Escrow Amount Fund as determined as of Closing by reference to such stockholder's ownership of shares of Company Common Stock (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to shares constituting the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow AmountFund), without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent stockholders of the Company (the "Company Stockholders"). Distributions of any -------------------- Escrow Agent”), such deposit to constitute an escrow fund (Shares from the Escrow Fund”) to Account shall be governed by the terms set forth hereinand conditions of the Escrow Agreement. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature adoption of this Agreement as and the approval of the date hereof between Merger by the other signatories heretoCompany Stockholders shall constitute approval of the Escrow Agreement and of all the arrangements relating thereto, including, without limitation, the placement of the Escrow Shares in escrow and the appointment of the Stockholders' Representative. The No portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund contributed in respect of any Loss subject to indemnification pursuant to this Article 8 unless Company Option or any other security exercisable or convertible into Company Common Stock. To the amount extent possible, no shares of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered Parent Common Stock contributed to the Escrow Agent as provided in paragraph (e) below in which case Parent Fund shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy unvested or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included any right of repurchase, risk of forfeiture or other condition in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary favor of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateSurviving Corporation.

Appears in 1 contract

Sources: Merger Agreement (Actuate Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this AgreementSection 1.8, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable promptly after the Effective Time, SCM shall deposit the Closing Escrow Amount, without any act of any Shareholder, will be deposited Amount with J.▇. ▇▇▇▇▇▇ Greater Bay Trust Company, National Association Company (or other another institution acceptable to Parent SCM and the Shareholder RepresentativeShareholders' Agent (as defined in Section 8.2(g) below)), as Escrow Agent (the "Escrow Agent"). In addition, such prior to the payment of any Contingent Merger Consideration payable to the Shareholders pursuant to Section 1.14, SCM shall deposit 15% of each Contingent Merger Consideration payment with the Escrow Agent. All amounts so paid to constitute the Escrow Agent shall constitute, collectively, an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The Each Shareholder's portion of the Closing Escrow Amount or aggregate Contingent Merger Consideration contributed on behalf of each Shareholder to the Escrow Fund shall correspond to such Shareholder's Proportionate Interest. The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate SCM and its officers, directors and affiliates (i) for the “Indemnified Parties”payment to SCM of any adjustments to the Merger Consideration pursuant to Section 1.13 of this Agreement, to the extent such adjustments to the Merger Consideration are not made on or prior to the Closing, and (ii) harmless against all claimssubject to paragraph (o), lossesfor any claim, liabilitiesloss, damagesexpense, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained disbursements in this Agreement, (ii) any failure by the Company to perform or comply connection with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language proceeding, to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect extent of any Loss subject to indemnification pursuant to this Article 8 unless the amount of such claim, loss, expense, liability or other damage (collectively "Losses") that SCM or any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Lossesof its affiliates has actually incurred (or, which in the aggregate exceed $1,000,000 (case of an extension of the “Basket Amount”Escrow Period pursuant to Section 8.2(b)(ii), have been delivered to reasonably anticipates incurring), by reason of the Escrow Agent as provided in paragraph breach by the Company or the Shareholders of any representation, warranty, covenant or agreement of the Company or the Shareholders contained herein (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountCompany Disclosure Schedule); Each Shareholder acknowledges that notwithstanding that such Shareholder has not made the representations and warranties made by the Company, it is understood and agreed that each Shareholder must indemnify SCM jointly and severally for items (i) and (ii) described in the immediately preceding sentence; provided, however, that claims for Losses incurred as a result of a breach by a specific Shareholder ("Specific Shareholder Claims") shall be satisfied solely out of such Shareholder's Proportionate Interest in the Escrow Fund until such Proportionate Interest in the Escrow Fund is exhausted and no other Shareholder's Proportionate Interest in the Escrow Fund shall be used to satisfy any such Losses. SCM and the Company each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger Consideration. Notwithstanding the foregoing, SCM shall not be entitled to receive any disbursement with respect to any Loss resulting from the inaccuracy or breach of Losses under Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company 8.2(a)(ii) arising in respect of any taxable year (individual occurrence or portion thereofcircumstance unless the amount of the aggregate Losses of SCM under Section 8.2(a)(ii) ending on or prior shall exceed $150,000, and then SCM shall be entitled to recover from the Expiration DateEscrow Fund only the total of its Losses in excess of $150,000.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (SCM Microsystems Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company's shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholdershareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholdershareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other an institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder shareholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). No portion of the Escrow Amount shall be contributed in respect of any Company Options or Warrants. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein (as modified by the Company Schedules, (ii) without giving effect to any update thereto), or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amountherein; provided, however, that Parent may not receive any Loss resulting shares from the inaccuracy or breach of Section 2.03(c)Escrow Fund unless and until such Losses exceed in the aggregate $500,000, 4.05 or 6.20 hereof in which event Parent shall be recoverable from the first dollar and not subject receive shares equal in value to the Basket Amount nor shall it be included in calculating whether full amount of such Losses. Parent and the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent Company each acknowledge that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentLosses, if any, would relate to unresolved contingencies existing at the CompanyEffective Time, or any Subsidiary of which if resolved at the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.Effective Time would have led to

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Netscape Communications Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, certificates representing shares of Holdco Common Stock comprising a portion of the Devnet Merger Securities with a value (determined pursuant to Section 13.5(b)) of $5 million (the "Escrow AmountShares") shall be registered in the name of, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ with, US Trust Company, National Association (or other institution acceptable to Parent and selected by FiberNet with the Shareholder Representativereasonable consent of the Managing Member) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the Escrow Fund”) Fund and to be governed by the terms set forth herein. herein and in the Escrow Agreement attached hereto Exhibit C. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder --------- Fund shall be as provided under Section 2.04. The Shareholders shall indemnify available to compensate Holdco and hold Parent FiberNet in respect of any and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directorsLosses resulting from or arising out of, or affiliates (including the Surviving Corporation) directly or indirectly as a result of in connection with, (i) any inaccuracy misrepresentation or breach of a representation or warranty of the Company contained made by Devnet in this AgreementAgreement or in any Document executed and delivered by Devnet, (ii) any failure breach by the Company to perform or comply with Devnet of any covenant contained or agreement made under this Agreement or in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right Document executed and delivered by Devnet relating to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year a period (or portion thereof) ending on or prior to the Expiration Closing Date, and (iii) any and all actions, suits, proceedings, claims, demands, assessments, judgements, costs and expenses incident to any of the foregoing. The foregoing notwithstanding, FiberNet and Holdco shall have no claim against the Escrow Fund with respect to any of the foregoing until all Losses with respect thereto exceed $300,000 (the "Minimum Amount"), provided however that in the event that such Losses do exceed the Minimum Amount, FiberNet's and Holdco's claim against the Escrow Fund hereunder shall include all Losses resulting from any such breach, including, without limitation, those included in the Minimum Amount. Following the Effective Time, the Escrow Fund shall be the sole and exclusive remedy of FiberNet and Holdco for any Losses resulting from any breach of any representation, warranty or covenant. (b) [Intentionally Omitted]. (c) Notwithstanding anything contained in this Agreement to the contrary, FiberNet, Holdco, Merger Sub and Devnet Merger Sub hereby expressly waive, relinquish and release any right or remedy available to it at law, in equity or under this Agreement to make a claim against the Escrow Fund for damages that FiberNet, Holdco, Merger Sub and Devnet Merger Sub may incur, as the result of any of Devnet's representations, warranties or covenants being untrue, inaccurate, incorrect or breached if FiberNet, Holdco, Merger Sub or Devnet Merger Sub had actual knowledge that such representation, warranty or covenant was untrue, inaccurate, incorrect or breached at the time of the Closing and the Closing nevertheless takes place.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Fibernet Telecom Group Inc\)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and Effective Time, by virtue of this Agreementthe Merger, and without any action on the part of Acquiror, Merger Sub, the Shareholders will Company, the Company Securityholders, or the Securityholder Representative, an amount equal to each Company Preferred Holder’s Closing Pro Rata [***] Confidential treatment has been requested for the bracketed portions. The confidential redacted portion has been omitted and filed separately with the Securities and Exchange Commission. Portion of the Escrow Amount shall be deemed withheld from the consideration otherwise payable to have received such Company Preferred Holder pursuant to Sections 1.8(a), 1.8(b), and 1.8(c). The amount so withheld from each Company Preferred Holder who is an Accredited Investor and deposited into the Escrow Fund shall be in the form of shares of Acquiror Common Stock and the amount so withheld from each Company Preferred Holder who is an Unaccredited Investor and deposited into the Escrow Amount shall be in the form of cash. At the Closing, Acquiror shall deposit, or cause to be deposited, with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit of the Escrow Amount to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute in this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount Agreement (together with any dividends and income earned on the Escrow Amount, the “Escrow Fund”), and, upon such deposit, Acquiror shall be deemed to have contributed to the Escrow Fund, on behalf of each Shareholder Company Preferred Holder, an amount equal to such Company Preferred Holder’s Closing Pro Rata Portion of the Escrow Amount. The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (available to compensate the Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) Parties for any claims by such parties for any Losses suffered or incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in them and for which they are entitled to recovery under this Agreement, (ii) any failure by including Article VIII, and shall be distributed in accordance the Company to perform or comply with any covenant contained in terms and conditions of this Agreement, or (iii) any actionincluding Article VIII, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from and the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateAgreement.

Appears in 1 contract

Sources: Agreement and Plan of Merger (Quotient Technology Inc.)

Escrow Fund. As At the Closing, as partial security for the indemnity provided for in this Article 8 and by virtue of this AgreementSection 7.1, the Shareholders Sellers will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent Buyer after the Effective Time with respect to the Escrow AmountClosing) without any act of any ShareholderSeller. As soon as practicable after the Effective TimeClosing, the Escrow Amount, without any act of any ShareholderSeller, will be deposited with J.▇. ▇▇▇▇▇▇ State Street Bank and Trust CompanyCompany of California, National Association (or other institution acceptable to Parent and the Shareholder Representative) N.A. as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an a portion of the escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Buyer's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder Management Seller shall be as provided one half of the Option Fund. The portion of the Escrow Amount contributed on behalf of each Seller besides the Management Sellers shall be in proportion to the aggregate amount of Class A Preferred Shares which such holder would otherwise be entitled under Section 2.041.2. Schedule 7.3 sets forth the name, address and taxpayer identification number (when known and applicable) of each Seller, as well as the number of Class A Preferred Shares held for each Seller in the Escrow Fund or the number of shares of Parent Common Stock held for each Seller in the Option Fund or Repurchase Fund (as defined below), as applicable, and the percentage interest of each Seller in the Escrow Fund, the Option Fund or the Repurchase Fund. Whenever any fact stated in Schedule 7.3 changes, or whenever any New Shares (as defined in Section 7.3(c)(ii)) are issued and deposited into the Escrow Fund, the Buyer shall furnish to the Escrow Agent a revised version of Schedule 7.3. Unless and until the Escrow Agent receives such revised Schedule 7.3, the Escrow Agent may assume without inquiry that Schedule 7.3 has not been, and is not required to be, amended. Subsequent to the Closing any Parent Common Stock issued to either Management Seller upon exercise of their Options up to 12.5% of the number of shares of Parent Common Stock initially subject to each Management Seller Option (the "REPURCHASE FUND") shall, upon such exercise without an act of either Management Seller also be deposited with the Escrow Agent and constitute a portion of the Escrow Fund. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) for any Losses incurred by Parent, its Unlimited, Buyer, their officers, directors, or affiliates (including the Surviving CorporationCompany) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein (as modified by the Company Schedules, (ii) without giving effect to any update thereto), or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Timeherein. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any Sellers each acknowledge that such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, if any, would relate to unresolved contingencies existing at the Closing, which if resolved at the Closing would have led to a reduction in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateConsideration.

Appears in 1 contract

Sources: Share Purchase Agreement (Zapme Corp)

Escrow Fund. As security for (a) The escrow fund (the indemnity provided for "ESCROW FUND") referred to in this Article 8 and by virtue Agreement shall consist of two components. The first component of the Escrow Fund consists of the portion of the Contingent Shares referred to as being held in the Escrow Fund in Section 1.5 of this Agreement, . The second component of the Shareholders Escrow Fund consists of the Indemnity Shares referred to below (this portion being referred to as the "INDEMNITY PORTION OF THE ESCROW Fund"). Both components of the Escrow Fund will be deemed to have received and deposited with held by the Escrow Agent (as defined below) in accordance with the Escrow Amount terms of this Agreement. (plus any additional b) At the Closing, 151,766 shares as may of Series G Stock (the "INDEMNITY SHARES") shall be issued upon any stock splitregistered in the name of, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ with, U.S. Bank Trust Company, National Association (or other institution acceptable to selected by Parent and with the Shareholder Representativeconsent of the Company, which shall not be unreasonably withheld) as Escrow Agent escrow agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the initial funding of the Indemnity Portion of the Escrow Fund”) Fund and to be governed by the terms set forth herein. The herein and in the Escrow Agent may execute this Agreement following the date hereof, and such later executionattached hereto as EXHIBIT S. Additional shares of Series G stock, if so executed after added to the date hereof, shall not affect Indemnity Portion of the binding nature Escrow Fund pursuant to Section 1.5(b)(iii)(B) of this Agreement as of or pursuant to the date hereof between terms contained in the other signatories heretoSeries G Warrants, shall also be deemed to be Indemnity Shares. The portion Indemnity Shares contained in the Indemnity Portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold available to compensate Parent and its officers, directors and affiliates (pursuant to the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty indemnification obligations of the Company contained Equityholders. In the event Parent issues any Additional Indemnity Shares (as defined below), such shares will be issued in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as name of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 Agent and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Indemnity Shares delivered at the Closing. (c) Except for dividends paid in paragraph stock, declared with respect to the Indemnity Shares, including any dividends issued upon such dividends ("ADDITIONAL INDEMNITY SHARES", which will be considered Indemnity Shares thereafter), which shall be treated as part of the Indemnity Portion of the Escrow Fund pursuant to Section 9.1(b) hereof, any cash dividends, dividends payable in securities or other distributions of any kind made in respect of the Indemnity Shares or the Additional Indemnity Shares will be delivered to the former Company Equityholder in accordance with the Equityholder's Proportionate Interest. Each former Company Equityholder will have voting rights with respect to the Indemnity Shares and Contingent Shares deposited in the Escrow Fund with respect to such former Company Equityholder so long as such Indemnity Shares and Contingent Shares are held in escrow, and Parent will take all reasonable steps necessary to allow the exercise of such rights. While the Contingent Shares and Indemnity Shares remain in the Escrow Agent's possession pursuant to this Agreement, the former stockholders of the Company for whom such shares are held will retain and will be able to exercise all other incidents of ownership of said Contingent Shares and Indemnity Shares which are not inconsistent with the terms and conditions of this Agreement. (d) In the event the shares of Series G Stock held as Indemnity Shares or Additional Indemnity Shares should convert by their terms into Parent Common Stock (or any other class of Parent capital stock), then such shares of Parent Common Stock (or other class of stock) shall receive the same treatment as the shares of Series G Stock under this Section 9 in 49 accordance with the calculation of the Equityholder's Proportionate Interest existing immediately prior to the conversion. (e) below The right of each Company Equityholder to receive a portion of the Contingent Shares and Indemnity Shares, if applicable, is personal to each such Company Equityholder and shall remain with each such Company Equityholder in the event of any transfer of shares of Series G Stock (or other securities of Parent held by such Company Equityholder as a result of the Merger, except for the right to the portion of the Cash Consideration and the Contingent Shares represented by a Series G Warrant, which case Parent shall will remain and be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(ctransferred with such Series G Warrant), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject unless explicit provision to the Basket Amount nor shall it be included in calculating whether the Basket Amount contrary has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that effected by such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEquityholder.

Appears in 1 contract

Sources: Merger Agreement (Mitokor)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's stockholders will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) Time), without any act required on the part of any Shareholderstockholder. As soon as practicable after the Effective Time, the General Escrow AmountAmount and the Special Escrow Amounts (collectively, the "ESCROW AMOUNT") without any act required on the part of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent and the Shareholder RepresentativeStockholder Agent (as defined in Section 7.2(g)(i) below) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock to which such holder would otherwise be entitled under Section 2.04Sections 1.6(a)(i). The Shareholders Escrow Amount shall indemnify be contributed entirely out of the shares of Parent Common Stock issuable upon the Merger in respect of Capital Common Stock, and hold no portion of the Escrow Amount shall be contributed out of the shares of Parent Common Stock reserved for issuance in respect of Company Options. That portion of the Escrow Fund comprised of the General Escrow Amount is available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and out-of-pocket expenses of investigation (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein, (ii) or any failure by the Company to perform or comply with any covenant contained herein. That portion of the Escrow Fund comprised of the Special Escrow Amount I is available as an Offset as provided in this AgreementSection 1.6(g)(viii) hereof. That portion of the Escrow Fund comprised of the Special Escrow Amount II is available to compensate Parent and its affiliates from any Losses incurred by Parent, its officers, directors or affiliates (including the Surviving Corporation) directly or indirectly as a result of any claims of current or former stockholders of the Company or former stockholders of Orcim Acquisition Corp. ("ORCIM") that are due to, arise out of or otherwise relate to the merger between the Company and Orcim which became effective November 15, 1993, or the rights of the stockholders in connection therewith (iii) any action, suit or proceeding which is pending or threatened against herein "ORCIM CLAIMS"). Parent and the Company as of each acknowledge that such Losses, if any, would relate to unasserted contingent liabilities existing at the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after , which if resolved at the Effective Time. Notwithstanding anything Time would have led to a reduction in the preceding language to the contrary, the aggregate Merger consideration. Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”), 250,000 have been delivered to the Escrow Agent as provided in paragraph (e); in such case, Parent may recover from the Escrow Fund its Losses, including the first $250,000. The foregoing limitations shall not apply to (i) below any Offset under Section 1.6(g)(viii), (ii) any Orcim Claims or (iii) any claim for indemnification arising from a breach of any representation or warranty set forth in which case Section 2.8 (relating to Taxes) and Parent shall not be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject limited to the Basket Amount nor shall it be included amount in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced Escrow Fund to the extent that compensate for such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateLosses.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (New Era of Networks Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow AmountAcquiror shall deposit with Comerica Bank, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent escrow agent (the “Escrow Agent”), an aggregate cash payment of Five Million Dollars ($5,000,000) out of the Merger Consideration, such deposit to constitute an escrow fund the Escrow Fund (the “Escrow Fund”) and to be governed by the terms set forth herein. herein and in the Escrow Agreement attached hereto as Exhibit C. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify available to compensate Acquiror for any and hold Parent and its officersall losses, directors and affiliates (the “Indemnified Parties”) harmless against all claimscosts, lossesdamages, liabilities, damagesexpenses, deficienciesclaims, costs obligations and expensescosts, including reasonable attorneys’, accountants’ and other experts’ fees and expenses the amount of investigation any judgment and interest arising from claims, demands, Actions, and causes of action (hereinafter individually a collectively, Loss” and collectively “LossesDamages”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result arising out of (i) any inaccuracy misrepresentation or breach of a representation or warranty default in connection with any of the Company contained representations, warranties, covenants and agreements given or made by SDRC, the Stockholders Representative or the Principal Stockholders in this Agreement, (ii) the SDRC Disclosure Schedule, any failure by the Company to perform exhibit or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant schedule to this Article 8 unless the amount Agreement or any certificate or other written instrument of any such Loss equals or exceeds $25,000 and until SDRC delivered in connection herewith (each an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the Basket AmountIndemnifiable Matter”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that for purposes of determining if there is any Loss resulting such Indemnifiable Matter, for purposes of calculating any Damages arising from the inaccuracy or breach of Section 2.03(c)such misrepresentation, 4.05 or 6.20 hereof such representation and warranty shall be recoverable from the first dollar read as if it were not qualified by any concept of “material,” “materiality,” “Material Adverse Effect” or similar qualification). Acquiror and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent SDRC each acknowledge that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentDamages, if any, would relate to unresolved contingencies existing at the CompanyEffective Time, or any Subsidiary of which if resolved at the Company Effective Time would have led to a reduction in respect of any taxable year (or portion thereof) ending on or prior the Merger Consideration Acquiror would have agreed to pay in connection with the Expiration DateMerger.

Appears in 1 contract

Sources: Merger Agreement (ARGON ST, Inc.)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Participating Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount shares of ClickOver Common Stock and ClickOver Preferred Stock (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent ClickOver after the Effective Time with respect to the Escrow AmountTime) without any act of any Participating Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Participating Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other an institution acceptable to Parent ClickOver and the Shareholder Representative) Focalink Securityholder Agent as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat ClickOver's cost and expense. The portion of the Escrow Amount contributed on behalf of each Participating Shareholder shall be as provided in proportion to the aggregate ClickOver Common Stock and ClickOver Preferred Stock which such holder would otherwise be entitled to receive under Section 2.041.6. The Shareholders No portion of the Escrow Amount shall indemnify and hold Parent and its officersbe contributed in respect of any Focalink Warrants. Subject to the limits of Section 7.2(g) below, directors and affiliates (the “Indemnified Parties”) harmless against all Escrow Fund shall be available to compensate ClickOver for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by ParentClickOver, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company Focalink contained in this AgreementArticle II herein (as modified by the Focalink Schedules), (ii) or any failure by the Company Focalink to perform or comply with any covenant contained in this Agreementherein. ClickOver and Focalink each acknowledge that such Losses, or (iii) any actionif any, suit or proceeding which is pending or threatened against would relate to the Company as of unresolved contingencies existing at the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after , which, if resolved at the Effective Time. Notwithstanding anything in the preceding language Time would have led to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which a reduction in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateMerger consideration.

Appears in 1 contract

Sources: Merger Agreement (Adknowledge Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Parent shall deliver or cause to be delivered, directly to an escrow agent to be selected prior to the Effective Time (the “Escrow Agent”) the General Escrow Amount and the Special Escrow Amount to be deducted from the Net Merger Consideration and held in an escrow fund pursuant to the terms set forth herein and in an escrow agreement to be entered into by and among Parent, the Company, the Stockholder Representative and the Escrow AmountAgent, without substantially in the form attached hereto as Exhibit B (the “Escrow Agreement”). Subject to the terms of this Agreement and the Escrow Agreement, the General Escrow Amount shall be available for a period beginning on the date of the Closing and ending on the date that is eighteen (18) months thereafter (the “General Escrow Release Date”) to satisfy such indemnification obligations of the Company pursuant to Section 10.01 for claims as are made on or prior to the General Escrow Release Date and shall be paid out as provided in the Escrow Agreement. In addition, and subject to the terms of this Agreement and the Escrow Agreement, the Special Escrow Amount shall be available for a period beginning on the date of the Closing and ending on the date that is six (6) months thereafter (the “Special Escrow Release Date”) to satisfy such additional indemnification obligations of the Company pursuant to Section 10.01 for Special Coverage Claims as are made on or prior to the Special Escrow Release Date and shall be paid out as provided in the Escrow Agreement. The adoption of this Agreement and the approval of the Merger by the Company Stockholders will constitute the approval of the Company Stockholders, except any act holders of any ShareholderDissenting Shares, will be deposited with J.of the Escrow Agreement and of all the arrangements relating thereto, including the placement of the General Escrow Amount and Special Escrow Amount in escrow, the appointment of . ▇▇▇▇▇▇ Trust Company▇▇▇▇▇▇▇▇ as the initial Stockholder Representative in Article XI and any obligations of, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”)payments due by, such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute stockholders under this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of or the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (Embarcadero Technologies Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective, Time the Shareholders Company's stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time which amount shall include New Shares in accordance with respect to the Escrow AmountSection 8.2(c)(ii)) without any act of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Chase Manhattan Bank and Trust Company, National Association N.A. (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock and portion of the Aggregate Cash Component which such holder would otherwise be entitled under Section 2.041.6(a) and shall be in the respective share amounts and percentages listed opposite each Company stockholder's names listed in a schedule to be executed by the Company and delivered to Parent at Closing (the "Escrow Schedule"). The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (including the “Indemnified Parties”Surviving Corporation) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (exclusive of any punitive damages asserted solely by Parent or its affiliates and not related to any Third-Party Claim) (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained herein (or in any certificate, instrument, schedule or document attached to this Agreement, Agreement and delivered by the Company in connection with the Merger) or (ii) any failure by the Company to perform or comply with any covenant or obligation contained in this Agreement, herein or (iii) Advisors Fees not otherwise accounted for at the Closing under Section 6.20(a) or (iv) any actionadjustment under Section 6.20(d)(i); provided that such claims must be asserted on or before 5:00 p.m. (California Time) on the Expiration Date. Except as otherwise provided herein, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares, cash or property from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in Section 8.2(d) below) identifying Losses, the aggregate amount of which exceed $100,000 (except in the aggregate exceed $1,000,000 (case of Losses arising from fraud, from Advisor Fees not otherwise accounted for at the “Basket Amount”Closing under Section 6.20(a) or under 6.20(d)(i), as to each of which such threshold shall not apply), have been delivered to the Escrow Agent as provided in paragraph (ef) below and such amount is determined pursuant to this Article VIII to be payable; in which case such case, Parent shall be entitled to may recover all Losses including the Basket Amount; provided, however, that any Loss resulting shares from the inaccuracy Escrow Fund equal in value to all indemnified Losses (including any Losses within the $100,000 threshold) for which there is no objection or breach any objection had been resolved in favor of Section 2.03(c)Parent, 4.05 its affiliates or 6.20 hereof the Surviving Corporation in accordance with the provisions of this Article VIII. For purposes of this Article VIII, the phrases "Company stockholders" and "stockholders of the Company" shall be recoverable from the first dollar and not subject refer to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary stockholders of the Company in respect of any taxable year (or portion thereof) ending on or immediately prior to the Expiration DateEffective Time.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Niku Corp)

Escrow Fund. As security for provided in Section 1.8, promptly ----------- following the indemnity provided for in this Article 8 Effective Time, Splash shall deposit $1,755,000 with Comerica Bank (or another institution acceptable to Splash and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Shareholders' Agent (as defined in Section 7.2(g) below) the Escrow Amount (plus any additional shares as may be issued upon any stock split)), stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the "Escrow Agent"), such deposit to cash in ------------ the Escrow Amount, which shall constitute an escrow fund (the "Escrow Fund") to ----------- be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder holder of Company Capital Stock shall correspond to such shareholder's Proportionate Escrow Interest. The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate Splash and its officers, directors and affiliates (i) for the “Indemnified Parties”payment to Splash of any adjustments to the Merger Consideration pursuant to Section 1.13 of this Agreement, and (ii) harmless against all claimsfor any claim, lossesloss, liabilitiesexpense, damages, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained disbursements in this Agreement, (ii) any failure by the Company to perform or comply connection with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language proceeding, to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect extent of any Loss subject to indemnification pursuant to this Article 8 unless the amount of such claim, loss, expense, liability or other damage (collectively "Losses") that Splash or any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Lossesof ------ its affiliates has actually incurred (or, which in the aggregate exceed $1,000,000 (case of an extension of the “Basket Amount”Escrow Period pursuant to Section 7.2(b)(ii), have been delivered to reasonably anticipates incurring), by reason of (x) the Escrow Agent as provided in paragraph breach by the Company of any representation, warranty, covenant or agreement of the Company contained herein (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountDisclosure Schedule), or (y) the breach by any of the Company Shareholders of any representation, warranty, covenant or agreement contained in such Company Shareholders' Shareholders Agreements; provided, however, that claims for Losses ----------------- incurred as a result of a breach by a Company Shareholder shall be satisfied out of such shareholder's Proportionate Escrow Interest of the Escrow Fund until such Proportionate Escrow Interest is exhausted, and then shall be satisfied out of the Escrow Fund in accordance with this Agreement. Splash and the Company each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger Consideration. Splash shall not be entitled to receive any disbursement with respect to any Loss resulting from the inaccuracy or breach of under Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company 7.2(a)(ii) arising in respect of any taxable year individual occurrence or circumstance unless the amount of the Loss arising in respect of such occurrence or circumstance individually, exceeds a $10,000 deductible level; provided, -------- however, that (i) in the event ------- -37- the aggregate Losses of Splash under Section 7.2(a)(ii) shall exceed $100,000, then Splash shall be entitled to recover from the Escrow Fund the total of its Losses including any amounts below the $10,000 deductible for each such occurrence or portion thereofcircumstance and (ii) ending on or prior the foregoing limitation shall not apply to the Expiration Dateany Third Party Expense required to be paid pursuant to Section 1.13(b) hereof.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Splash Technology Holdings Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below1) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeClosing Date, a portion of the shares of AmeriNet's Common Stock to be issued in the Reorganization equal to the Escrow Number plus any additional New Shares (as defined below) as may be issued in respect thereof after the Closing Date) (collectively, the "Escrow AmountShares"), without any act of any Shareholderstockholder, will be registered in the name of Yankees, AmeriNet's strategic planning consultant, or such other person or legal entity as may otherwise be selected by AmeriNet prior to the Closing, as escrow agent (the "Escrow Agent"), and will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other a financial institution acceptable to Parent AmeriNet and the Shareholder RepresentativeAgent [as defined in Section 7.2(H) as Escrow Agent (the “Escrow Agent”below)], such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. at AmeriNet's sole cost and expense. (a) The portion of AmeriNet Common Stock in the Escrow Amount Fund contributed on behalf of each Shareholder stockholder of Vista Vacations is listed opposite such stockholders' name on Exhibit 7.2(A). (b) The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate AmeriNet and its officersaffiliates for any claim, directors and affiliates (the “Indemnified Parties”) harmless against all claimsloss, lossesexpense, liabilities, damages, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees that AmeriNet or any of its affiliates has incurred or reasonably anticipates incurring by reason of the breach by Vista Vacations of any representation, warranty, covenant or agreement of Vista Vacations contained herein, ("Losses"), but only to the extent that such Losses exceed $20,000. (c) AmeriNet and expenses Vista Vacations each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Time of investigation Closing, which if resolved at the Closing would have led to a reduction in the total number of shares of AmeriNet Common Stock AmeriNet would have agreed to issue in connection with the Reorganization. (hereinafter individually a “Loss” and collectively “Losses”3) incurred by Parent, its officers, directors, or affiliates (including Nothing herein shall limit the Surviving Corporation) directly or indirectly as a result liability of (i) Vista Vacations for any inaccuracy or breach of a representation any representation, warranty or warranty of covenant if the Company contained in this Agreement, (ii) any failure by the Company Reorganization does not close. Resort to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect shall be the exclusive contractual remedy of any Loss subject to indemnification pursuant to this Article 8 unless the amount of AmeriNet and its affiliates for any such Loss equals or exceeds $25,000 breaches and until an Officers’ Certificate identifying Losses, which in misrepresentations if the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountReorganization does close; provided, however, that nothing herein shall limit any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datenoncontractual remedy for fraud.

Appears in 1 contract

Sources: Reorganization Agreement (Amerinet Group Com Inc)

Escrow Fund. As security for provided in Section 1.3, on the indemnity provided for in this Article 8 and by virtue of this AgreementClosing Date, the Shareholders will be deemed to have received and deposited SCM shall deposit with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, SCM Common Stock equalling the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to which shall constitute an escrow fund (the “Escrow Fund”ESCROW FUND) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Exchanging Shareholder shall be as provided under Section 2.04correspond to such stockholder's Escrow Shares. The Shareholders Escrow Fund shall indemnify and hold Parent and its officersbe available to compensate SCM (i) for any claim, directors and affiliates (the “Indemnified Parties”) harmless against all claimsloss, lossesexpense, liabilities, damages, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained disbursements in this Agreement, (ii) any failure by the Company to perform or comply connection with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against proceeding, to the Company as extent of the Effective Time. No amount of such claim, loss, expense, liability or other damage (collectively LOSSES) that SCM or any of its affiliates has actually incurred (or, in the case of an extension of the Escrow Period pursuant to Section 7.2(b)(ii), reasonably anticipates incurring), by reason of the breach by any Exchanging Shareholder shall have of any right representation, warranty, covenant or agreement of Shuttle contained herein, (ii) for any Third Party Expenses in excess of $400,000 and any fees and expenses of Stan▇▇▇▇ ▇▇▇▇▇, ▇▇ each case, to contribution the extent not deducted from the Company Transaction Consideration on the Closing Date; and (iii) for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language pursuant to the contrary, the Parent may not receive any distribution from the Escrow Fund Tax Covenant contained in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountSchedule 3 hereof; provided, however, that claims for Losses incurred as a result of a breach by an Exchanging Shareholder shall be satisfied out of such shareholder's proportionate interest of the Escrow Fund set opposite such Exchanging Shareholders' name in Schedule 1 (the PROPORTIONATE INTEREST) until such Proportionate Interest is exhausted. SCM and Shuttle each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Closing Date, which if resolved at the Closing Date would have led to a reduction in the aggregate Transaction Consideration. SCM shall not be entitled to receive any disbursement with respect to any Loss resulting from the inaccuracy or breach of under Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company 7.2(a) arising in respect of any taxable year (individual occurrence or portion thereofcircumstance unless the amount of the Loss arising in respect of all such occurrences or circumstances in the aggregate exceeds a $100,000 level; provided, however, that in the event the aggregate Losses of SCM under Section 7.2(a) ending on shall exceed $100,000, then SCM shall be entitled to recover from the Escrow Fund the total of its Losses including any amounts below the $100,000 level for each such occurrence or prior to the Expiration Datecircumstance.

Appears in 1 contract

Sources: Share Exchange Agreement (SCM Microsystems Inc)

Escrow Fund. As security (a) The Escrow Fund shall be available to compensate the Indemnified Parties for the indemnity provided any claims by such parties for in any Losses suffered or incurred by them and for which they are entitled to recovery under this Article 8 and by virtue of this AgreementIX. Except as set forth below, the Shareholders will period during which claims for Losses to be deemed recovered from the Escrow Fund may be made under this Agreement shall commence at the Closing and terminate on the date that is eighteen (18) months after the Closing Date (the “Escrow Period”). (b) No later than five (5) Business Days after the end of the Escrow Period or the date a Subsequent Escrow Release Amount is due to have received the Indemnifying Parties pursuant to Section 9.5(c), the Securityholder Representative shall deliver to Buyer an updated version of the Closing Payment Spreadsheet (each, an “Escrow Release Payment Spreadsheet”) within five (5) Business Days after such date in a form and deposited substance reasonably satisfactory to Buyer and accompanied by documentation reasonably satisfactory to Buyer in support of the information set forth therein. The Escrow Release Payment Spreadsheet shall set forth the following information in reasonable detail: (i) all information specified in Sections 2.3(a)(i)-(iv) inclusive, as updated to reflect the release of the Initial Escrow Release Amount or Subsequent Escrow Release Amount, as applicable; and (ii) the amount of any portion of the Initial Escrow Release Amount or Subsequent Escrow Release Amount, as applicable, payable to each Company Securityholder in accordance with the Escrow Agent terms of the Governing Documents. (as defined belowc) No later than five (5) Business Days after Buyer receives the Escrow Amount (plus any additional shares as may be issued upon any stock splitRelease Payment Spreadsheet, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act remaining portion of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without less any act amount of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (actual Losses or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later executionLosses estimated in good faith, if so executed after the date hereofpossible, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject resolved claims that have yet to indemnification pursuant to this Article 8 unless the amount of be satisfied or any such Loss equals or exceeds $25,000 unresolved and until an Officers’ pending claims specified in any Officer’s Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket AmountUnresolved Claims), have been ) delivered to the Escrow Agent as provided and the Securityholder Representative in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of accordance with Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending 9.5 on or prior to the Expiration Dateend of the Escrow Period (the “Initial Escrow Release Amount”), shall be distributed to the Indemnifying Parties in accordance with the terms of the Escrow Agreement and the Escrow Release Payment Spreadsheet. (d) In the event that there exist Unresolved Claims as of the expiration of the Escrow Period, as soon as each such Unresolved Claims has been resolved, the Escrow Agent shall promptly, and in any event within five (5) Business Days following the after Buyer receives the Escrow Release Payment Spreadsheet, deliver to the Indemnifying Parties in accordance with the terms of the Escrow Agreement, the portion of the Escrow Fund, if any, that was retained for purposes of satisfying such claim that was not needed to satisfy such claim (each a “Subsequent Escrow Release Amount”) in accordance with the Escrow Release Payment Spreadsheet.

Appears in 1 contract

Sources: Merger Agreement (F5 Networks, Inc.)

Escrow Fund. As security for (i) For the indemnity provided for in this Article 8 and by virtue avoidance of this Agreementdoubt, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowA) the Escrow Amount is intended to be used to fund Sellers’ indemnification obligations in an amount up to 50% of the Retention (plus i.e. as recourse for matters for which the RWI Policy would have covered but for the Retention under the RWI Policy), (B) the amount of any additional shares as may Losses that would give rise to any indemnification obligations of Sellers hereunder and that would be issued upon any stock splitcovered by the RWI Policy but for the Retention thereunder shall nonetheless be an indemnification obligation of Sellers hereunder, stock dividend or recapitalization effected by Parent after the Effective Time with respect subject to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms limitations set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates herein (including the Surviving CorporationDeductible), (C) directly or indirectly as a result nothing in this Article IX shall be deemed to limit any rights of any Buyer Indemnitee against the insurance carrier under the RWI Policy and (iD) any inaccuracy or breach of a representation or warranty the claims period and limitations under the RWI Policy may differ from the terms herein solely for purposes of the Company contained in this Agreement, administration of the RWI Policy and shall have no effect on the indemnification obligations of Sellers hereunder. (ii) From and after the Closing Date, any failure by the Company to perform Losses for which any one or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as more of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject Buyer Indemnitees is otherwise entitled to indemnification pursuant to the term so this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent Agreement shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not satisfied (subject to the Basket Amount nor shall it be included other limitations in calculating whether the Basket Amount has otherwise been exceeded; and providedthis Section 9.04): (A) first, further, that any claim resulting from the inaccuracy or breach of Section 4.26 such indemnification obligation shall be satisfied from Escrow Amount until the Retention has been satisfied; (B) second, such indemnification obligation shall be satisfied by recovery under the RWI Policy, if applicable, until the RWI Policy limits have been exhausted; (C) third, such indemnification obligation shall be satisfied from Escrow Amount until the Escrow Amount is reduced to $0; (D) fourth, such indemnification obligation shall be satisfied as a dollar-for-dollar set-off against (x) the principal amount of the AvKARE Seller Notes and the Rondo Top Notes, until a maximum amount of $1,000,000 has been set-off, and (y) the principal amount of the R&S Seller Notes; and (E) thereafter, but only with respect to breaches of any Fundamental Representations or items described in Section 9.02(b), Section 9.02(c), Section 9.02(d), Section 9.02(e) or Section 9.02(f), to the extent such indemnification obligations remain unsatisfied (including in the event that the RWI Policy does not cover the applicable Losses), Sellers shall be liable to such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company Buyer Indemnitee for such indemnification payments in respect of any taxable year accordance with this Article IX (or portion thereof) ending on or prior subject to the Expiration Dateall other limitations set forth in this Article IX).

Appears in 1 contract

Sources: Equity Purchase Agreement (Amneal Pharmaceuticals, Inc.)

Escrow Fund. As security for (a) On or as soon as practicable after the indemnity provided for date hereof, Purchaser will cause 1,526,788 shares of common stock of Purchaser, par value $.0001 per share (the “Common Stock”), which shares shall be registered in this Article 8 the name of Escrow Agent f/b/o the Former Holders of Capital Stock of XLNT Veterinary Care, Inc. (the “Escrow Shares”), to be delivered to the Escrow Agent in book-entry form, and by virtue the Escrow Agent will acknowledge receipt of the Escrow Shares to the Purchaser and the Representatives promptly upon receipt thereof. Subject to the terms and conditions of this Escrow Agreement, the Shareholders will be deemed Escrow Agent shall hold the Escrow Shares and shall invest, reinvest and manage any proceeds thereof as directed in Section 3(d) (the “Proceeds”; the Escrow Shares and such Proceeds are collectively referred to have received herein as the “Escrow Fund”). The Escrow Agent shall hold, exercise voting rights with respect to and deposited dispose of, the Escrow Shares only in accordance with the terms of this Escrow Agreement or joint written instructions of the Purchaser and the Representatives and shall not release the Escrow Shares or the rest of the Escrow Fund except in accordance with this Escrow Agreement. The parties acknowledge that the Escrow Agent (as defined below) is not acting in a capacity that would warrant the re-issuance, sale, or denominational breakdown of any shares by the Escrow Amount Agent. The Escrow Agent shall not be held liable for any action taken, suffered or omitted to be taken by it, and shall have no duty to inform the Purchaser or the Representative that it has received any proxy materials or other information from the Purchaser, in each case in its capacity as a registered stockholder. (plus b) If Purchaser at any additional shares as may be issued upon time or from time to time between the date of this Escrow Agreement and the final disposition of the Escrow Fund in accordance with this Escrow Agreement, (i) subdivides (by any stock split, stock dividend dividend, recapitalization or recapitalization effected otherwise) its outstanding shares of Common Stock into a greater number of shares, or (ii) combines (by Parent after reverse stock split or otherwise) its outstanding shares of Common Stock into a smaller number of shares, then the Effective Time with respect Purchaser will deliver notice thereof to the Escrow Amount) without any act Agent, and, unless the applicable authorizing Board of any Shareholder. As soon Directors resolutions do not require delivery of new Escrow Shares as a result of such action, the Purchaser will as promptly as practicable after the Effective Time, effective date with respect thereto deliver to the Escrow Amount, without any act Agent in book-entry form the requisite Escrow Shares as may be required to reflect the applicable increase or reduction of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as such Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereinShares. The Escrow Agent may shall be entitled to execute this Agreement following and deliver any transmittal letter or other documents and share certificates required to effectuate an exchange of shares if contemplated by the action taken pursuant to the preceding clauses (i) or (ii). If Purchaser at any time or from time to time between the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Escrow Agreement as of and the date hereof between the other signatories hereto. The portion final disposition of the Escrow Amount contributed on behalf Fund in accordance with this Escrow Agreement pays any distribution or dividend in respect of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify the Escrow Shares in additional shares of Common Stock, then the Purchaser will deliver notice thereof to the Escrow Agent and hold Parent and its officersthe Representatives, directors and affiliates (and, unless the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses applicable authorizing Board of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly Directors resolutions do not require delivery of additional Escrow Shares as a result of (i) any inaccuracy or breach such action, the Purchaser will as promptly as practicable after the payment date with respect thereto deliver to the Escrow Agent additional Escrow Shares representing such additional shares of a representation or warranty of the Company contained Common Stock. Upon such delivery referred to in this AgreementSection 2.1(c), (ii) any failure by the Company to perform Escrow Agent shall hold such additional or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder substitute Escrow Shares and “Escrow Shares” shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language refer to the contrary, the Parent may not receive any distribution from shares represented by such new or substitute Escrow Shares for all purposes under this Escrow Agreement. (c) This Agreement assumes that the Escrow Fund will at all times be comprised only of Common Stock and cash (and interest earned thereon). If the Common Stock is converted into any securities or other property other than Common Stock, or any securities or other property (in each case, other than cash (and interest earned thereon) or additional shares of Common Stock) are distributed, issued or exchanged with respect to any shares of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which Common Stock (then held in the aggregate exceed $1,000,000 Escrow Fund) upon any recapitalization, reclassification, merger, consolidation, stock dividend or the like, or if for any other reason securities or other property (in each case, other than cash (and interest earned thereon) or additional shares of Common Stock) at any time are held in the “Basket Amount”)Escrow Fund, have been delivered the Purchaser and the Representatives shall negotiate in good faith, and execute and deliver, such supplemental written instructions to the Escrow Agent as provided are necessary to account for such other securities or property in paragraph a manner consistent with the results that would have prevailed if only Common Stock and cash (eand interest earned thereon) below were held in which case Parent the Escrow Fund, and shall deliver such supplemental written instructions to the Escrow Agent. If the Parties are unable to agree on any such supplemental instructions contemplated by the preceding sentence within 30 days after such sentence shall become applicable, then the Escrow Agent shall refrain from taking any action with respect to such property other than Common Stock and cash (and interest earned thereon), other than to keep safely such other property until it shall be directed otherwise in writing jointly by Purchaser and the Representatives or by final non-appealable order of a court of competent jurisdiction. The Escrow Agent shall be entitled to recover all Losses including the Basket Amount; providedexecute and deliver any transmittal letter or other documents and Escrow Shares required in connection with such any recapitalization, howeverreclassification, that merger, consolidation or similar event to receive any Loss resulting shares of stock, securities, properties or cash in exchange for Escrow Shares. (d) Upon written instructions from the inaccuracy or breach of Section 2.03(c)Representatives from time to time, 4.05 or 6.20 hereof the Escrow Agent shall execute and deliver to the Representative such revocable proxies as are necessary in order for the Representative to exercise any and all voting rights relating to the Escrow Shares then held in the Escrow Fund. Such proxies shall be recoverable from revoked by the first dollar and not subject Escrow Agent with respect to any Escrow Shares delivered to the Basket Amount nor shall it be included in calculating whether Purchaser or the Basket Amount has otherwise been exceeded; and providedRepresentatives hereunder, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datesuch delivery.

Appears in 1 contract

Sources: Escrow Agreement (Pet DRx CORP)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders Parent will be deemed to have received and deposited deposit with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any ShareholderStockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderStockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association the Escrow Agent (or other institution acceptable to Parent and the Shareholder Representative) Stockholder Representative (as Escrow Agent (the “Escrow Agent”defined in this Article 8)), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Stockholder shall be as provided in proportion to the Merger Consideration contributed at the Closing to which such holder would otherwise be entitled under Section 2.042.02. The Shareholders Stockholders shall indemnify and hold Parent and its officers, directors and affiliates (the "Indemnified Parties") harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) the Company's commitments and liabilities in accordance with Generally Accepted Accounting Principles ("GAAP") at the date hereof being in excess of the amount set forth in Schedule A (such excess commitments and liabilities can be offset by a corresponding asset recordable under GAAP, (iv) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time, (v) any liabilities of the Company for Taxes attributable to a Pre- Closing Tax Period ending prior to the Closing Date which are not reserved for on Schedule A, (vi) any payments in respect of Dissenting Shares that are recoverable pursuant to Section 2.04(c) (which shall include Parent's reasonable legal and other fees incurred in connection with any appraisal proceeding), or (vii) any License Fee Make Whole which arises after the Closing Date. No Shareholder Stockholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, and subject to the procedures set forth in paragraphs (e) and (f) of this Section 8.02, Parent may not receive any distribution of the Escrow Amount from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (e) below) identifying Losses, which in the aggregate exceed $1,000,000 100,000 (the "Basket Amount"), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 pursuant to Sections 2.04(c) hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (Ventro Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Parent will deposit the Escrow Amount, without any act of any Shareholder, will be deposited Amount with J.▇. ▇▇▇▇▇▇ Computershare Trust Company, National Association N.A. (or other another institution acceptable to selected by Parent and reasonably satisfactory to the Shareholder RepresentativeCompany) as Escrow Agent escrow agent (the “Escrow Agent”), such deposit to constitute an escrow fund which Escrow Fund will be governed by this Agreement and the Escrow Agreement in substantially the form attached hereto as Exhibit K (the “Escrow FundAgreement). The Escrow Fund will constitute partial security for the benefit of Parent (on behalf of itself or any other Indemnified Person) with respect to be governed by any Indemnifiable Damages pursuant to the terms set forth hereinindemnification obligations of the Equityholders under this Article 8. The Escrow Agent may execute this Agreement following will hold the Escrow Fund until 11:59 p.m. Pacific Time on the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified PartiesEscrow Release Date”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which that is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent 18 months after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from Neither the Escrow Fund (including any portion thereof) nor any beneficial interest therein may be pledged, subjected to any Lien, sold, assigned or transferred by any Equityholder or be taken or reached by any legal or equitable process in respect satisfaction of any Loss subject to indemnification pursuant to this Article 8 unless the amount debt or other Liability of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying LossesEquityholder, which in each case prior to the aggregate exceed $1,000,000 (distribution of the “Basket Amount”Escrow Fund to any Equityholder in accordance with Section 8.1(b), have been delivered to except by will, by the laws of intestacy or by other operation of law. (b) Within two Business Days following the Escrow Release Date, Parent and Agent will cause the Escrow Agent as provided in paragraph to deliver (ei) below in which case Parent shall be entitled the Escrow Fund less (ii) that portion of the Escrow Fund necessary to recover satisfy the maximum amount of all Losses including unresolved Claim Certificates to the Basket Amount; provided, however, that any Loss resulting from Equityholders pursuant to the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar terms and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach conditions of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary Article 2. Any portion of the Company in respect Escrow Fund held by the Escrow Agent after the Escrow Release Date will be distributed by the Escrow Agent within two Business Days following the resolution of any taxable year (or portion thereof) ending on or prior the applicable Claim Certificate pursuant to the Expiration DateSection 8.5.

Appears in 1 contract

Sources: Merger Agreement (Bill.com Holdings, Inc.)

Escrow Fund. As partial security for the indemnity provided for ----------- in this Article 8 Section 7.2 hereof and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited Buyer shall deposit with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeClosing, the Escrow Amount, without any act of any ShareholderSeller, will be deposited with J.▇. ▇▇▇▇▇▇ First Trust Companyof California, National Association (or other institution acceptable to Parent Buyer and the Shareholder RepresentativeSeller) as Escrow Agent (the "Escrow ------ Agent"), such deposit deposits to constitute an escrow fund (the "Escrow Fund") to be ----- ----------- governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall Seller agrees to indemnify and hold Parent Buyer and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by ParentBuyer, ---- ------ its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of Seller or the Company contained in this Agreement, (ii) Net Liabilities as of the Closing Date exceeding Estimated Net Liabilities or (iii) any failure by Seller or the Company to perform or comply with any covenant contained in this Agreement; provided that, with respect to any inaccuracy or breach of any representation or -------- ---- warranty set forth in Section 2.9 as a result of a Customer Termination or Customer Notice, "Loss" shall mean with respect to each such Customer Termination a dollar amount equal to one hundred percent (iii100%) of the Annualized Revenue for such former Customer less the amount of any action, suit or proceeding which is pending or threatened against revenue earned by the Company as of with respect to such Customer after the Effective TimeClosing Date. No Shareholder The Escrow Fund shall be available to compensate Buyer and its affiliates for any such Losses. Seller shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent Buyer after the Effective TimeClosing. Notwithstanding anything in the preceding language to the contrary, the Parent Buyer may not receive any distribution cash from the Escrow Fund in respect of any Loss subject unless and until the amount determined to indemnification be owed to Buyer pursuant to this Article 8 unless undisputed Officer's Certificates (as defined in paragraph (e) below) identifying Losses and disputed Officer's Certificates which have been resolved through the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Lossesarbitration process set forth in Section 7.2(g), which in the aggregate exceed $1,000,000 (the “Basket Amount”)100,000, have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amountbelow; provided, however, that any Loss resulting from with respect -------- ------- to each of: (i) Third Party Expenses in excess of the inaccuracy greater of (A) Estimated Third Party Expenses or (B) $250,000, (ii) Net Liabilities as of the Closing Date in excess of Estimated Net Liabilities, and (iii) Losses related to a breach of the representation and warranty set forth in Section 2.03(c), 4.05 or 6.20 hereof 2.23(j) the aforementioned $100,000 threshold shall not be recoverable from applicable for purposes of claims of Losses against the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Amount.

Appears in 1 contract

Sources: Share Acquisition Agreement (Concentric Network Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Acquirer shall withhold the Cash Escrow Amount, without any act of any Shareholder, will be deposited Amount from the Merger Consideration payable pursuant to Section 1.3(a) and shall deposit the Cash Escrow Amount with J.▇. ▇▇▇▇▇▇ Trust CompanyFargo Bank, National Association N.A. (or other another institution acceptable selected by Acquirer and reasonably satisfactory to Parent and the Shareholder RepresentativeCompany) as Escrow Agent escrow agent (the “Escrow Agent”)) (the aggregate amount of cash so held by the Escrow Agent from time to time, such deposit to constitute an escrow fund (the “Escrow Fund”) to ), which Escrow Fund shall be governed by this Agreement and the terms set forth hereinescrow agreement (the “Escrow Agreement”) in the form attached hereto as Exhibit M with such changes as Acquirer and the Stockholders’ Agent may agree in writing. The Escrow Fund shall constitute security for the benefit of Acquirer (on behalf of itself or any other Indemnified Person) with respect to any Indemnifiable Damages pursuant to the indemnification obligations of the Converting Holders under this Article VIII. The Escrow Agent may execute this Agreement following shall hold the Escrow Fund until 11:59 p.m. Pacific time on the date hereof, and such later execution, if so executed that is 12 months after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates Effective Time (the “Indemnified PartiesEscrow Release Date) harmless against ). The Converting Holders shall not receive interest or other earnings on the cash in the Escrow Fund. The parties further agree that all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including income received with respect to the Surviving Corporation) directly or indirectly Cash Escrow Amount will be reported as a result of (i) any inaccuracy or breach of a representation or warranty allocated to Acquirer until the distribution of the Company contained Cash Escrow Amount (or portions thereof) is determined and thereafter to Acquirer and the Converting Holders in this Agreement, (iiaccordance with their respective interests in the Cash Escrow Amount. Any portion of any payments or distributions to the Converting Holders that is treated as interest under Section 483 of Code or otherwise shall be treated as portfolio interest under Section 871(h) any failure by of the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of Code. The parties further agree that immediately following the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from Cash Consideration deposited in the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered will initially be Unvested Cash to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; maximum extent possible, provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof Unvested Cash deposited in the Escrow Fund shall be recoverable from the first dollar and not subject vest prior to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect vesting of any taxable year Unvested Cash that is not deposited in the Escrow Fund. Neither the Escrow Fund (or including any portion thereof) ending nor any beneficial interest therein may be pledged, subjected to any Encumbrance, sold, assigned or transferred by any Converting Holder or be taken or reached by any legal or equitable process in satisfaction of any debt or other Liability of any Converting Holder, in each case prior to the distribution of the Escrow Fund to any Converting Holder in accordance with Section 8.1(b), except that each Converting Holder shall be entitled to assign such Converting Holder’s rights to such Converting Holder’s Pro Rata Share of the Escrow Fund by will, by the laws of intestacy or by other operation of law. (b) Within three Business Days following the Escrow Release Date, the Escrow Agent will distribute to each Converting Holder such Converting Holder’s Pro Rata Share of the remaining Escrow Fund less that portion of the Escrow Fund that is necessary to satisfy all pending but unresolved claims for indemnification specified in any Claim Certificate delivered to the Stockholders’ Agent on or prior to the Expiration DateEscrow Release Date in accordance with this Article VIII. Any portion of the Escrow Fund held by the Escrow Agent following the Escrow Release Date with respect to pending but unresolved claims for indemnification that is not awarded to Acquirer upon the resolution of such claims shall be distributed by the Escrow Agent to the Converting Holders within three Business Days following resolution of such claims and in accordance with each such Converting Holder’s Pro Rata Share of such portion of the Escrow Fund.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Marin Software Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Closing the Shareholders receiving NEON Common Stock will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount Shares (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent NEON after the Effective Time with respect Closing) pursuant to the Escrow Amount) Agreement attached hereto as Exhibit B hereto, without any act required on the part of any Shareholder. As soon as practicable after the Effective TimeClosing, the Escrow AmountShares, without any act required on the part of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent NEON and the Shareholder RepresentativeRepresentative (as defined in Section 7.2(h)(i) below) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat NEON's cost and expense. The portion of the Escrow Amount Fund contributed on behalf of each Shareholder shall be as provided under Section 2.04set forth in Schedule 1.1. The Shareholders Escrow Fund shall indemnify and hold Parent be comprised entirely of the Escrow Shares. The Escrow Fund shall be available to compensate NEON and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by ParentNEON, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company or the Shareholders, contained in this AgreementArticles II and III herein (as modified by the Company Disclosure Schedule), (ii) or any failure by the Company or the Shareholders to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder herein; provided that NEON shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund with respect to any individual Loss not exceeding $5,000 and shall not receive any shares from the Escrow Fund unless such Losses exceed $500,000 in respect the aggregate, at which time NEON shall receive shares from the Escrow Fund for such first $500,000 in Losses and to the extent of any Loss subject to indemnification pursuant to this Article 8 unless such excess. NEON and the amount of any Company each acknowledge that such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, if any, would relate to unasserted contingent liabilities existing at the Closing, which if resolved at the Closing would have led to a reduction in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered Purchase Price. The foregoing limitations shall not apply to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary obligations of the Company Shareholders to pay the income taxes described in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateSection 5.6.

Appears in 1 contract

Sources: Share Acquisition Agreement (New Era of Networks Inc)

Escrow Fund. As Mortgagor shall, or shall cause Prime Tenant to, pay to Mortgagee on the first day of each calendar month (a) one-twelfth of an amount which would be sufficient to pay the Impositions payable, or estimated by Mortgagee to be payable, during the next ensuing twelve (12) months and (b) one-twelfth of an amount which would be sufficient to pay the Insurance Premiums due for the renewal of the coverage afforded by the Policies upon the expiration thereof (said amounts in (a) and (b) above hereinafter called the "Escrow Fund"). The Escrow Fund and the payments of interest or principal or both, payable pursuant to the Note shall be added together and shall be paid as an aggregate sum by Mortgagor to Mortgagee. Mortgagor hereby pledges to Mortgagee any and all monies now or hereafter deposited in the Escrow Fund as additional security for the indemnity payment of the Debt. Upon receipt of evidence, satisfactory to Mortgagee, that proves that the Impositions and Insurance Premiums and any other items for which sums have been deposited by Mortgagor into the Escrow Fund have been paid in full,and provided that no Event of Default (hereinafter defined) has occurred hereunder, Mortgagee shall, on each January 1 after the date hereof credit any excess funds in the Escrow Fund against future payments to be made to the Escrow Fund. In allocating such excess, Mortgagee may deal with the person shown on the records of Mortgagee to be the owner of the Mortgaged Property. If the Escrow Fund is not sufficient to pay the items set forth in (a) and (b) above, Mortgagor shall promptly pay to Mortgagee, upon demand, an amount which Mortgagee shall estimate as sufficient to make up the deficiency. Upon the occurrence of an Event of Default, Mortgagee may apply any sums then present in the Escrow Fund to the payment of the following items in any order in its uncontrolled discretion: (i) Impositions and other charges; (ii) Insurance Premiums; (iii) interest on the unpaid principal balance of the Note; (iv) amortization of the unpaid principal balance of the Note; (v) maintenance of the Mortgaged Property; and (vi) all other sums payable pursuant to the Note, this Mortgage and the Other Security Documents, including without limitation advances made by Mortgagee pursuant to the terms of this Mortgage. Until expended or applied as above provided, any amounts in the Escrow Fund shall constitute additional security for the Debt. In accepting the Escrow Fund, Mortgagee is not consenting to act as Mortgagor's agent for the payment of Impositions or Insurance Premiums and the Escrow Fund shall not constitute a trust fund and may be commingled with other monies held by Mortgagee. No earnings or interest on the Escrow Fund shall be payable to Mortgagor. Notwithstanding anything contained in this Article 8 paragraph 5 to the contrary, so long as (a) the Prime Tenant is the sole tenant of the entire Premises pursuant to the Prime Lease, (b) the Prime Lease is in full force and by virtue effect, (c) no default or event which with the passing of time or the giving of notice would become a default has occurred under the Prime Lease, and (d) the Prime Tenant is responsible for paying the Impositions under the Prime Lease and actually pays the Impositions before they become delinquent, then the obligations of Mortgagor under this Agreement, the Shareholders will paragraph 5 shall be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amountmet; provided, however, in the event that Mortgagor is obligated pursuant to the Prime Lease to pay for or maintain insurance of any Loss resulting from the inaccuracy or breach of Section 2.03(c)type, 4.05 or 6.20 hereof Mortgagor shall be recoverable from the first dollar and not subject required to escrow sums with Mortgagee for such required insurance pursuant to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach terms of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datethis paragraph 5.

Appears in 1 contract

Sources: Mortgage and Security Agreement (Quantum Corp /De/)

Escrow Fund. As In addition to the indemnification obligation of the Principal Stockholders which shall not be limited to the Escrow Amount, as security for the indemnity provided for in this Article 8 Section 7.2 hereof and by virtue of this AgreementAgreement and the Company Stockholders' approval thereof, at the Effective Time, the Shareholders Company Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.3(g) below)), as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth hereinherein and at Parent's cost and expense. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) for any Losses incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreementherein, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreementherein, (iii) the failure of the Company's Cash Account to contain an amount of cash that equals or exceeds the Third Party Expenses incurred by the Company for which failure the Total Consideration has not been previously reduced, or (iiiiv) any action, suit the payment by Parent or proceeding which is pending or threatened against the Company as of any amount on account of Dissenting Shares in excess of the Effective Timeconsideration which would have otherwise been received if such shares were not Dissenting Shares. No Shareholder shall have any right Other than with respect to contribution from knowing, willful or intentional breaches of the Company for any claim representations, warranties or covenants made by Parent after in connection with this Agreement or the Effective Time. Notwithstanding anything in the preceding language to the contraryMerger, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Threshold Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case such case, Parent shall be entitled to may recover all from the Escrow Fund the total of its Losses including the Basket Threshold Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Tibco Software Inc)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeClosing, the Escrow AmountShares shall be registered in the name of, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ Trust Companywith, First Union National Association Bank (or other institution acceptable agreeable to Parent both PURCHASER and the Shareholder RepresentativeTARGET) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit and any Additional Escrow Shares to constitute an escrow fund (the Escrow Fund”) Fund and to be governed by the terms set forth hereinherein and in the Escrow Agreement in substantially the form attached hereto as Exhibit 4. The Escrow Agent may execute this Agreement following Fund shall be available to compensate PURCHASER pursuant to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as indemnification obligations of the date hereof between Warranting Stockholders. In the other signatories hereto. The portion event PURCHASER issues any Additional Escrow Shares (as defined below), such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Escrow Shares delivered at the Closing. (b) Except for dividends paid in paragraph stock declared with respect to the Escrow Shares (e) below in "Additional Escrow Shares"), which case Parent shall be entitled treated as Escrow Shares pursuant to recover all Losses including the Basket Amount; providedSection 9.01(a) hereof, howeverany cash dividends, that dividends payable in securities or other distributions of any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company kind made in respect of any taxable year (or portion thereof) ending on or prior the Escrow Shares will be delivered to the Expiration DateWarranting Stockholders based on each such Warranting Stockholder's Proportional Allotment. Each Warranting Stockholder shall have voting rights with respect to the Escrow Shares deposited in the Escrow Fund with respect to such stockholder's Proportional Allotment so long as such Escrow Shares are held in escrow, and PURCHASER will take all reasonable steps necessary to allow the exercise of such rights. While the Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement and the Escrow Agreement, the Warranting Stockholders shall retain and shall be able to exercise all other incidents of ownership of such Escrow Shares which are not inconsistent with the terms and conditions of this Agreement.

Appears in 1 contract

Sources: Escrow Agreement (Brainworks Ventures Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders Closing each Shareholder will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect pursuant to the Escrow Amount) Agreement attached hereto as Exhibit C, without any act required on the part of any Shareholderthe Shareholders. As soon as practicable after the Effective TimeClosing, the Escrow Amount, without any act required on the part of any Shareholderthe Shareholders, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”)into an interest-bearing account, such deposit to constitute an escrow fund (the Escrow Fund”) Fund to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04at NEON's cost and expense. The Shareholders shall bear the tax for all interest attributable to the Escrow Account. The Escrow Fund shall be comprised entirely of the Escrow Amount. The Escrow Fund is available to indemnify and hold Parent compensate NEON and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) for any Losses incurred by ParentNEON, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty or covenant of the Company Shareholders, contained in this AgreementArticles II and III and VI herein, (ii) or any failure by the Company Shareholders to perform or comply with any covenant contained in this Agreement, or (iii) herein. NEON shall not be entitled to recover any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution amount from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds until its Losses exceed $25,000 and until an Officers’ Certificate identifying Losses, which 100,000 in the aggregate exceed $1,000,000 (the “Basket Amount”)aggregate, have been delivered to the Escrow Agent as provided in paragraph (e) below in at which case Parent shall be entitled to time NEON may recover all of its Losses including the Basket Amount; first $100,000, provided, however, that any Loss resulting from the inaccuracy Losses incurred by NEON relating to any representation, warranty or breach of covenant related to Taxes set forth in Sections 2.10 and 6.7 or to Section 2.03(c), 4.05 2.3 or 6.20 Article III hereof shall not be recoverable from the first dollar and not subject to such minimum amount. NEON and the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent Shareholders each acknowledge that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentLosses, if any, would relate to unasserted contingent liabilities existing at the CompanyClosing, or any Subsidiary of which if resolved at the Company Closing would have led to a reduction in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Dateaggregate Purchase Price.

Appears in 1 contract

Sources: Share Acquisition Agreement (New Era of Networks Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 VIII and by virtue of this Agreement, the Shareholders Company Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) that portion of the Escrow Amount equal to the Indemnification Escrow Fund (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyJPMorgan Chase Bank, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeStockholder Representative (as defined in this Article VIII)) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereinin Section 1.7(a) and this Article VIII. The Following the date hereof, the Escrow Agent may execute either a separate escrow agreement (the “Escrow Agreement”) or this Agreement following (for the date hereofsole purpose of agreeing to the provisions of this Article VIII), and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Stockholder shall be as provided in proportion to the aggregate number of shares of Parent Common Stock issued at the Closing to which such holder would otherwise be entitled under Section 2.041.6(a). The Shareholders shall Subject to the limitations set forth in this Article VIII, if the Merger is consummated, the Company Stockholders shall, severally and not jointly, indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, ; losses, liabilities, damages, . deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder Company Stockholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, and subject to the procedures set forth in paragraphs (e) and (f) of this Section 8.2, Parent may not receive any distribution shares of Parent Common Stock from the Indemnification Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer’s Certificates (as defined in paragraph (e) below) identifying Losses, which in the aggregate exceed $1,000,000 100,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy pursuant to Sections 1.6(a)(iv) or breach of Section 2.03(c), 4.05 or 6.20 1.6(e) hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Merger Agreement (Avi Biopharma Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Principal Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderPrincipal Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)), as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth hereinherein and at Parent's cost and expense. The Escrow Agent may execute this Agreement following Subject to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature provisions of this Agreement as of the date hereof between the other signatories hereto. The portion of Section 7.2, the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, and the Principal Stockholders (iias modified by the Company Schedules) or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against herein. Parent and the Company as of each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after , which if resolved at the Effective Time. Notwithstanding anything Time would have led to a change in the preceding language to Exchange Ratio. Nothing herein shall limit the contrary, the Parent may not receive any distribution from the Escrow Fund in respect liability of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, the Principal Stockholders or Parent for any Subsidiary of the Company in respect breach of any taxable year (representation, warranty or portion thereof) ending on or prior to covenant if the Expiration DateMerger does not close.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Rational Software Corp)

Escrow Fund. As security for (a) At the indemnity provided for Closing the Buyer shall cause Parent to deliver to Mellon Bank as escrow agent (the "Escrow Agent"), pursuant to an escrow agreement (the "Escrow Agreement") in this Article 8 and by virtue substantially the form attached hereto as Exhibit C, a number of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect Shares equal to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result product of (i) all of the Shares owned by the Representing Stockholders immediately prior to the Closing (which shall include the net exercise number of any inaccuracy or breach of a representation or warranty Shares issuable upon exercise of the Company contained in this Agreement, Options pursuant to Section 1.07) and (ii) any failure by the Company to perform or comply Deferred Exchange Ratio in effect on the Closing Date (the "Escrow Fund"). As will be set forth with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything more particularity in the preceding language to the contraryEscrow Agreement, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been Shares so delivered to the Escrow Agent (together with earnings and distributions thereon, including any Extraordinary Dividend, the "Escrow Shares"), shall be delivered to the Representing Stockholders pro-rata in accordance with their respective interests in the Company set forth on a schedule to the Escrow Agreement, less any amounts reserved for indemnification claims pursuant to Section 11.07, on the first, second and third anniversaries of the Closing Date in the amounts set forth in Section 1.02(a). The Buyer agrees to cause Parent to remove any restrictive legends contained on any Parent Shares distributed out of the Escrow Fund, within ten days of receipt by Parent of satisfactory evidence, if necessary, that such legends are no longer required by Rule 144(e), (f) and (h) of the Securities Act, or on the date of distribution for distributions occurring on or after the second anniversary of the Closing Date. If the Parent Shares are not sufficient or are more than required to satisfy the Buyer's obligations hereunder, either Parent shall issue additional Parent Shares to cure the deficiency or the Escrow Agent shall return the excess Escrow Shares, or the cash resulting from the previous sale thereof by the Escrow Agent, to Parent, as provided in paragraph applicable. The Representing Stockholders acknowledge that any additional Parent Shares so issued on the third anniversary will not be securities registered under the Securities Act. (eb) below in which case Parent The Representing Stockholders shall be entitled to recover receive all Losses distributions on Parent Shares including, but not limited to, any Extraordinary Dividend or other earnings, interest, dividends and share distributions, and any amounts paid or received in respect of such earnings, interest, dividends and share distributions, subject to the possible return of a portion of those distributions in proportion to the amount of any Parent Shares which might be returned to Parent pursuant to the terms of Section 1.09(a). The annual fees of the Escrow Agent shall be borne by the Buyer. Any fees associated with actions specifically requested by a Representing Stockholder, including the Basket Amount; provided, however, that any Loss those resulting from the inaccuracy sale of Parent Shares or breach of other securities by the Escrow Agent in accordance with Section 2.03(c1.02(b), 4.05 or 6.20 hereof shall be recoverable from borne by such Representing Stockholder. (c) The Escrow Agreement will provide that 3% of the first dollar and not subject to Parent Shares in the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 Escrow Fund shall be reduced set aside as a fund (the "Expense Fund") for expenses, if any, of the Stockholder Representatives (as defined in Section 2.03(a) below). The Escrow Agreement will further provide that the Stockholder Representatives shall be entitled to direct the Escrow Agent to disburse the Expense Fund, to the extent permitted under the Securities Act, to pay the expenses incurred by the Stockholder Representatives in the performance of their duties and actions hereunder and that such inaccuracy payments may be made directly to the third party to whom such expense is due or breach actually reduces any Tax otherwise payable by Parent, the Company, as reimbursement to one or any Subsidiary more of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateStockholder Representatives who paid such expenses.

Appears in 1 contract

Sources: Stock Purchase Agreement (Allegheny Energy Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below1) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeDate, a portion of the shares of AmeriNet's Common Stock to be issued in the Merger equal to the Escrow Number [as defined in paragraph 1.1(B)] (plus any additional New Shares (as defined below) as may be issued in respect thereof after the Effective Date) (collectively, the "Escrow AmountShares"), without any act of any Shareholderstockholder, will be registered in the name of a person or legal entity selected by AmeriNet prior to the Effective Time as escrow agent (the "Escrow Agent"), and will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other a financial institution acceptable to Parent AmeriNet and the Shareholder RepresentativeAgent [as defined in Section 7.2(H) as Escrow Agent (the “Escrow Agent”below)], such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. at AmeriNet's sole cost and expense. (a) The portion of AmeriNet Common Stock in the Escrow Amount Fund contributed on behalf of each Shareholder stockholder of Trilogy is listed opposite such stockholders' name on Exhibit 7.2(A). (b) The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate AmeriNet and its officersaffiliates for any claim, directors and affiliates (the “Indemnified Parties”) harmless against all claimsloss, lossesexpense, liabilities, damages, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees and expenses that AmeriNet or any of investigation (hereinafter individually a “Loss” and collectively “Losses”) its affiliates has incurred or reasonably anticipates incurring by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty reason of the Company breach by Trilogy of any representation, warranty, covenant or agreement of Trilogy contained in this Agreementherein, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreementcollectively, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying "Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”"), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced but only to the extent that such inaccuracy or Losses exceed $40,000 in the aggregate. (c) AmeriNet and Trilogy each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the total number of shares of AmeriNet Common Stock AmeriNet would have agreed to issue in connection with the Merger. (3) Nothing herein shall limit the liability of Trilogy for any breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (representation, warranty or portion thereof) ending on or prior covenant if the Merger does not close. Resort to the Expiration DateEscrow Fund shall be the exclusive contractual remedy of AmeriNet and its affiliates for any such breaches and misrepresentations if the Merger DOES CLOSE; PROVIDED, HOWEVER, that nothing herein shall limit any noncontractual remedy for fraud.

Appears in 1 contract

Sources: Merger Agreement (Amerinet Group Com Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with (a) The Acquiror hereby agrees that it shall seek a remedy from the Escrow Agent (as defined below) Fund, to the extent of the amount then held in the Escrow Amount (plus any additional shares as may be issued upon any stock splitFund, stock dividend or recapitalization effected by Parent after the Effective Time with respect to any indemnification claim asserted hereunder before seeking to recover any Losses directly from the Escrow AmountPrincipal Stockholders. (b) without any act of any Shareholder. As soon as practicable Upon the date that is eighteen (18) months after the Effective Time, the Escrow Amount, without Agent shall pay any act amounts remaining in the Escrow Fund to the Principal Stockholders (other than holders of any ShareholderDissenting Shares) as instructed by the Stockholder Representative, will subject to Section 9.6(c). Payment of such amounts to Principal Stockholders shall be deposited made pro rata in accordance with J.▇. ▇▇▇▇▇▇ Trust Companythe portion of the Merger Consideration each such Principal Stockholder would otherwise have been entitled to receive under Section 2.10(c), National Association by virtue of the ownership of outstanding Shares immediately prior to the Effective Time. (c) In the event an indemnification claim arises under this Article IX or other institution acceptable under Article VII and notice has been provided to Parent the Stockholder Representative prior to the date that is eighteen (18) months after the Effective Time, a good faith reasonable estimate of the Losses or Seller Taxes (as the case may be) claimed shall be made by the Indemnified Party and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The corresponding portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be retained until the amount of Losses or Seller Taxes (as the case may be) has been determined, and shall then be applied or distributed as provided under for in the Escrow Agreement. (d) For the avoidance of doubt, notwithstanding any release of the Escrow Fund to the Principal Stockholders in accordance with Section 2.04. The Shareholders 9.6(b) and (c), the Principal Stockholders shall indemnify remain liable in accordance with the terms and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses conditions of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of this Article IX for any indemnification claims brought pursuant to (i) any inaccuracy this Article IX within the relevant survival period under Section 9.1, including without limitation indemnification claims for Losses arising out of or relating to the breach of a any representation or warranty made in any Core Representation or in Section 3.10 relating to ERISA matters, Section 3.15 relating to Tax matters, Section 3.16 relating to environmental matters, or to any representation or warranty in the event of the Company contained in this Agreement, fraud or intentional misrepresentation; or (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateVII.

Appears in 1 contract

Sources: Merger Agreement (Integral Systems Inc /Md/)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable Promptly after the Effective Time, Parent shall deposit with the Escrow Amount, without any act Agent the Escrow Amount out of any Shareholder, will be deposited the Cash Consideration otherwise deliverable to the Escrow Participants pursuant to Section 1.6 hereof and shall confirm such deposit with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such . Such deposit to of the Escrow Amount shall constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The cash comprising the Escrow Agent may execute this Agreement following the date hereofFund shall be deposited by Parent with respect to each Escrow Participant without any act by them, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion in accordance with their respective Pro Rata Portions of the Escrow Amount contributed on behalf of each Shareholder Amount. The Escrow Fund shall be as security for the indemnity obligations provided under for in Section 2.046.2 hereof. The Shareholders Escrow Fund shall indemnify and hold Parent and its officers, directors and affiliates be subdivided into a $3,800,000 general escrow fund (the “Indemnified PartiesGeneral Escrow Fund”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation a $3,700,000 tax escrow fund (hereinafter individually a the Loss” and collectively “LossesTax Escrow Fund) ). The General Escrow Fund shall be available to compensate the Indemnified Parties for any claims by such parties for any Losses suffered or incurred by Parent, its officers, directors, or affiliates (including them and for which they are entitled to recovery under this ARTICLE VI. The Tax Escrow Fund shall be available to compensate the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company Indemnified Parties for any claim made claims by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive such parties for any distribution from the Escrow Fund in respect of any Loss subject Losses suffered or incurred by them and for which they are entitled to indemnification pursuant to this Article 8 unless Section 6.2(f) hereof. In the amount event that the Indemnified Parties have suffered or incurred Losses for which they are entitled to indemnification pursuant to Section 6.2(f) hereof in excess of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Lossesthe Tax Escrow Fund, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent Indemnified Parties shall be entitled to recover all Losses including such excess losses from the Basket AmountGeneral Escrow Fund; provided, however, for the avoidance of doubt, in the event that the Indemnified Parties have suffered any Loss resulting from Losses for which they are entitled to indemnification pursuant to Sections 6.2(a) through (e) hereof, such Indemnified Parties shall have no right to proceed against the inaccuracy Tax Escrow Fund for such Losses, regardless of whether or breach of Section 2.03(c), 4.05 or 6.20 hereof not the General Escrow Fund has been exhausted. Interests in the Escrow Fund shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datenon-transferable.

Appears in 1 contract

Sources: Merger Agreement (Nuance Communications, Inc.)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 Closing, a number of shares of Acquiror Common Stock equal to the sum of (i) 230,000 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowii) the quotient obtained by dividing (x) 10% of the difference of (1) Aggregate Cash Payment less (2) $3,200,000 by (y) the Closing Market Price (the "Escrow Amount (plus any additional shares as may Shares") shall be issued upon any stock splitregistered in the name of, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ with, First Trust Company, National Association of California (or other institution acceptable to Parent and selection by Acquiror with the Shareholder Representativereasonable consent of Target) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit to shall constitute an the escrow fund (the “"Escrow Fund") and to be governed by the terms set forth hereinherein and in the Escrow Agreement. The Escrow Agent may execute this Agreement following Fund shall be available to compensate Acquiror pursuant to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as indemnification obligations of the date hereof between shareholders of Target set forth in Section 8.3. In the other signatories hereto. The portion event Acquiror issues any Additional Escrow Shares (as defined below), such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Escrow Shares delivered at the Closing. (b) Except for dividends paid in paragraph stock declared with respect to the Escrow Shares (e) below in "Additional Escrow Shares"), which case Parent shall be entitled treated pursuant to recover all Losses including the Basket Amount; providedSection 8.1(a) hereof, howeverany cash dividends, that dividends payable in securities or other distributions of any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company kind made in respect of any taxable year (or portion thereof) ending on or prior the Escrow Shares will be delivered to the Expiration Dateshareholders of Target on a pro rata basis in accordance with the number of shares of Acquiror Common Stock deposited on behalf of such holder. Each shareholder of Target will have voting rights with respect to the Escrow Shares deposited in the Escrow Fund with respect to such shareholder so long as such Escrow Shares are held in escrow, and Acquiror will take all reasonable steps necessary to allow the exercise of such rights. While the Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement, the shareholders of Target will retain and will be able to exercise all other incidents of ownership of said Escrow Shares which are not inconsistent with the terms and conditions of this Agreement.

Appears in 1 contract

Sources: Merger Agreement (Cybercash Inc)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders will be deemed to have received and deposited with VisionChina shall cause the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after to distribute the Effective Time Escrow Amount to the Participating DMG Shareholders in accordance with respect the Closing Allocation Schedule. (b) On the first anniversary of the Closing Date (the “Escrow Release Date”), VisionChina shall cause the Escrow Agent to distribute any amounts contained in the Indemnity Escrow Fund at such time to the Participating DMG Shareholders in accordance with their respective pro rata interests in the Indemnity Escrow Fund, less, amounts that would be reasonably necessary to satisfy any then pending and unsatisfied or unresolved claims for indemnification duly made by the Indemnified Persons hereunder and pursuant to the Escrow AmountAgreement prior to the Escrow Release Date. (c) without any act of any ShareholderAmounts not distributed under Section 7.4(a) due to unsatisfied or unresolved claims after the Escrow Release Date shall remain in the Indemnity Escrow Fund until such claims have been resolved. As soon as practicable after all such claims have been resolved, VisionChina shall cause the Escrow Agent to distribute any amounts remaining in the Indemnity Escrow Fund to the Participating DMG Shareholders in accordance with their respective pro rata interests in such remaining amounts. (d) If the Third Party Consent has been delivered by the Company to VisionChina before the Effective Time, VisionChina shall cause the Escrow Amount, without Agent to distribute as promptly as practicable following the Effective Time any act of any Shareholder, will be deposited amounts contained in the Consent Escrow Fund to the Participating DMG Shareholders in accordance with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and their respective pro rata interests in the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Consent Escrow Fund”) to be governed by . If the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall Third Party Consent has not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure been delivered by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of VisionChina before the Effective Time. No Shareholder shall have any right to contribution from , on the earlier of the Escrow Release Date or the date the Third Party Consent is delivered by the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contraryVisionChina, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to VisionChina shall cause the Escrow Agent as provided to promptly deliver any amounts then remaining in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject Consent Escrow Fund to the Basket Amount nor shall it be included Participating DMG Shareholders in calculating whether accordance with their respective pro rata interests in the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateConsent Escrow Fund.

Appears in 1 contract

Sources: Agreement and Plan of Merger (Visionchina Media Inc.)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, shares of ISSI Common Stock which comprise the Escrow Amount, without any act of any ShareholderNexcom shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association an escrow agent selected by ISSI (or other institution which shall be reasonably acceptable to Parent and the Shareholder RepresentativeNexcom) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat a cost and expense to be borne by ISSI. The portion of the Escrow Amount contributed on behalf of each Shareholder holder of Nexcom Common Stock shall be as provided in proportion to the aggregate Merger Consideration which such holder would otherwise be entitled under Section 2.043.1. The Shareholders Escrow Agent shall indemnify and hold Parent not be responsible for confirming that the shares contributed to the Escrow Fund comprise the Escrow Amount or that the portion contributed on behalf of each holder of Nexcom Common Stock is in the proper proportion, which determination shall be made by ISSI. The Escrow Fund shall be available to compensate ISSI and its officersAffiliates for any and all actions, directors and affiliates (the “Indemnified Parties”) harmless against all suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable amounts paid in settlement, liabilities, obligations, taxes, liens, losses, liabilitiesexpenses, damagesand fees, deficiencies, including court costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply connection with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending to the extent of the amount of such actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable amounts paid in settlement, liabilities, obligations, taxes, liens, losses, expenses or threatened against fees (collectively "LOSSES") that ISSI or any of its Affiliates has incurred by reason of the Company as breach by Nexcom or the Majority Shareholders of any representation, warranty, covenant or agreement of Nexcom or either of the Majority Shareholders contained herein, or by reason of any misrepresentation by Nexcom or either of the Majority Shareholders made herein; ISSI, Nexcom and the Majority Shareholders each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after , which if resolved at the Effective Time. Notwithstanding anything Time would have led to a reduction in the preceding language aggregate Merger Consideration. Resort to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect shall be the exclusive contractual remedy of ISSI and its Affiliates against Nexcom or any Loss subject to indemnification pursuant to this Article 8 unless of its directors, officers, representatives, agents or shareholders or either of the amount of Majority Shareholders for any such Loss equals or exceeds $25,000 breaches and until an Officers’ Certificate identifying Losses, which in misrepresentations if the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountMerger does close; provided, however, that nothing herein shall limit any Loss resulting from the inaccuracy or breach of Section 2.03(c)remedy for fraud. In addition, 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.notwithstanding

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Integrated Silicon Solution Inc)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 and by virtue of this AgreementClosing, the Shareholders will be deemed to have received and deposited Buyer shall deposit with the Escrow Agent (as defined below) in accordance with Section 2.3(a), the Escrow Amount (plus any additional shares such funds, as may be issued upon any stock split, stock dividend or recapitalization effected held by Parent after the Effective Time with respect Escrow Agent pursuant to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeAgreement, the Escrow Amountincluding interest and income thereon, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to and the Escrow Fund shall be governed by held and distributed in accordance with the terms set forth hereinof this Agreement and the Escrow Agreement. In the event that any Buyer Indemnitees shall make a claim for indemnification against any Newpark Entity pursuant to ARTICLE VIII, such Buyer Indemnitee shall first seek recovery of any Buyer Damages from the Escrow Fund pursuant to the Escrow Agreement, to the extent funds are available therein. The Escrow Agent may execute Fund shall not represent a cap on, or otherwise limit the liabilities or obligations of the Newpark Entities with respect to any Buyer Damages under ARTICLE VIII. (b) The Escrow Fund shall be maintained in the escrow account established pursuant to the Escrow Agreement. The Escrow Fund, subject to the provisions of this Agreement following ARTICLE X and the date hereofEscrow Agreement, shall be maintained in the escrow account until the Escrow Release Date. (c) On the Escrow Interim Release Date, and such later executionsubject to the terms of this ARTICLE X and the Escrow Agreement, the Escrow Agent shall deliver or cause to be delivered to Newpark, or its designee, an amount equal to the lesser of: (i) fifty percent (50%) of the original Escrow Amount, or (ii) the remaining funds, if so executed after any, held in the date hereof, shall not affect the binding nature Escrow Account in excess of this Agreement as fifty percent (50%) of the date hereof between original Escrow Amount, unless prior to the other signatories heretoEscrow Interim Release Date Buyer provides to the Escrow Agent and Newpark a Claim Notice or an Indemnity Notice. The portion Any such notice shall set forth the total estimated amount (if such estimate is reasonably determinable) of the pending Third-Party Claim(s) and Indemnity Claims(s). If any such Claim Notice or Indemnity Notice is received by the Escrow Agent and not resolved prior to the Escrow Interim Release Date, the Escrow Agent shall release, in accordance with the Escrow Agreement, only that part of the Escrow Amount contributed on behalf that is eligible to be released pursuant to the preceding sentence that exceeds the estimated amount of each Shareholder any unresolved Third-Party Claim(s) or Indemnity Claim(s), with the remaining funds that would have been so released to be held in the Escrow Account until such claim(s) are resolved. (d) On the Escrow Final Release Date, subject to the terms of this ARTICLE X and the Escrow Agreement, the Escrow Agent shall deliver or cause to be delivered to Newpark, or its designee, the balance, if any, of the Escrow Fund, unless prior to the Escrow Final Release Date Buyer provides the Escrow Agent and Newpark a Claim Notice or an Indemnity Notice. Any such notice shall set forth the total estimated amount (if such estimate is reasonably determinable) of the pending Third-Party Claim(s) and Indemnity Claim(s). If any such Claim Notice or Indemnity Notice is received by the Escrow Agent and such claim is pending or not resolved prior to the Escrow Final Release Date, the Escrow Agent shall retain in the Escrow Account an amount equal to the estimated amount of the pending and unresolved claim(s), as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates set forth in the Claim Notice or Indemnity Notice (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Retained Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered and release to Newpark any amount in the Escrow Agent as provided Account in paragraph (e) below in which case Parent excess of the Retained Escrow Amount. The Retained Escrow Amount shall be entitled to recover all Losses including distributed in accordance with the Basket Amount; provided, however, that any Loss resulting from terms and provisions of this ARTICLE X and the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Agreement.

Appears in 1 contract

Sources: Membership Interests Purchase Agreement (Newpark Resources Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Parent will deposit the Escrow Amount, without any act of any Shareholder, will be deposited Fund with J.▇. ▇▇▇▇▇▇ Computershare Trust Company, National Association N.A. (or other another institution acceptable mutually agreeable to Parent and the Shareholder RepresentativeCompany) as Escrow Agent escrow agent (the “Escrow Agent”), such deposit to constitute an escrow fund which Escrow Fund will be governed by this Agreement and the Escrow Agreement in substantially the form attached hereto as Exhibit K (the “Escrow FundAgreement). The Escrow Fund will constitute partial security for the benefit of Parent (on behalf of itself or any other Indemnified Person) with respect to be governed by any Indemnifiable Damages pursuant to the terms set forth hereinindemnification obligations of the Equityholders under this Article 8. The Escrow Agent may execute this Agreement following will hold the Escrow Fund until 11:59 p.m. Pacific Time on the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified PartiesEscrow Release Date”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which that is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent 15 months after the Effective Time. Notwithstanding anything Neither the Escrow Fund (including any portion thereof) nor any beneficial interest therein may be pledged, subjected to any Lien, sold, assigned or transferred by any Equityholder or be taken or reached by any legal or equitable process in the preceding language satisfaction of any debt or other Liability of any Equityholder, in each case prior to the contrarydistribution of the Escrow Fund to any Equityholder in accordance with Section 8.1(b), except by will, by the laws of intestacy or by other operation of law. (b) Within two Business Days following the Escrow Release Date, Parent may not receive any distribution and Agent will cause the Escrow Agent to deliver (i) the Escrow Fund less (ii) that portion of the Escrow Fund necessary to satisfy the maximum amount of all unresolved Claim Certificate to the Equityholders pursuant to the terms and subject to the conditions of Article 2. Any portion of the Escrow Fund held by the Escrow Agent after the Escrow Release Date will be distributed by the Escrow Agent within two Business Days following the resolution of the applicable Claim Certificate pursuant to Section 8.5. (c) Parent and the Agent will cause distributions from the Escrow Fund to Parent or any other Indemnified Person in respect of any Loss subject to indemnification pursuant to accordance with this Article 8 unless to be made in cash and Parent Shares ratably, with the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in cash being equal to (i) the aggregate exceed $1,000,000 (total value of the “Basket Amount”), have been delivered portion of the Escrow Fund being released to the Escrow Agent as provided Equityholders at such time multiplied by (ii) the Cash Consideration Percentage, and the remaining portion being distributed in paragraph (e) below Parent Shares, in which each case with each Parent shall be entitled to recover all Losses including Share being valued at the Basket Amount; provided, however, that any Loss resulting from Parent Stock Price and with the inaccuracy or breach number of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject Parent Shares being released being rounded up to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datenearest whole share.

Appears in 1 contract

Sources: Merger Agreement (Bill.com Holdings, Inc.)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Acquirer shall withhold the Cash Escrow AmountAmount and the Stock Escrow Amount from the Merger Consideration payable and issuable pursuant to Section 1.3(a)(i) and shall deposit the Cash Escrow Amount and the Stock Escrow Amount with Citibank, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association N.A. (or other another institution acceptable selected by Acquirer and reasonably satisfactory to Parent and the Shareholder RepresentativeCompany) as Escrow Agent escrow agent (the “Escrow Agent”)) (the aggregate amount of cash and shares of Acquirer Common Stock so held by the Escrow Agent from time to time, together with any non-taxable stock dividends declared and paid in respect of such deposit to constitute an escrow fund (shares, the “Escrow Fund”) to ), which Escrow Fund shall be governed by this Agreement and the terms set forth hereinescrow agreement in substantially the form attached hereto as Exhibit I with such changes as Acquirer and the Stockholders’ Agent may agree in writing (the “Escrow Agreement”). The Escrow Fund shall constitute security for the benefit of Acquirer (on behalf of itself or any other Indemnified Person) with respect to any Indemnifiable Damages pursuant to the indemnification obligations of the Converting Holders under Section 1.6(i) and this Article VIII. Subject to Section 8.4, the Escrow Agent may execute this Agreement following shall hold that portion Escrow Fund other than the Mini-Escrow Fund (such portion, the “First Distribution Amount”) until 11:59 p.m. local time on the date hereofthat is 18 months after the Effective Time (the “First Escrow Release Date”) and shall hold the remainder of the Escrow Fund until 11:59 p.m. local time on the date that is three years after the Effective Time (the “Second Escrow Release Date”). Except to the extent there is a cancellation of shares of Acquirer Common Stock held in the Escrow Fund in connection with Indemnifiable Damages, shares of Acquirer Common Stock held in the Escrow Fund shall be treated by Acquirer as issued and outstanding stock of Acquirer, and the Converting Holders shall be entitled to exercise voting rights (which rights shall be exercised on behalf of such later executionConverting Holders by the Stockholders’ Agent) and to receive dividends with respect to such shares. The Converting Holders shall be treated for tax reporting purposes as the owners of the Stock Escrow Amount. Acquirer shall be treated for tax purposes as the owner of the Cash Escrow Amount, and all interest and other income earned on the Cash Escrow Amount, if so executed after the date hereofany, shall not affect the binding nature of this Agreement shall, as of the date hereof between end of each calendar year and to the extent required by the Applicable Law, be reported as having been earned by Acquirer, whether or not such income was disbursed during such calendar year. Neither the Escrow Fund (including any portion thereof) nor any beneficial interest therein may be pledged, subjected to any Encumbrance, sold, assigned or transferred by any Converting Holder or be taken or reached by any legal or equitable process in satisfaction of any debt or other signatories heretoLiability of any Converting Holder, in each case prior to the distribution of the Escrow Fund to any Converting Holder in accordance with Section 8.1(b), except that each Converting Holder shall be entitled to assign such Converting Holder’s rights to such Converting Holder’s Pro Rata Share of the Escrow Fund by will, by the laws of intestacy or by other operation of law. (b) Within five Business Days following the First Escrow Release Date, the Escrow Agent will distribute to each Converting Holder such Converting Holder’s Pro Rata Share of the First Distribution Amount less any portion of the First Distribution Amount with respect to pending but unresolved claims set forth in a valid Claims Certificate, to be necessary to satisfy all unsatisfied or disputed claims for indemnification specified in any Claim Certificate delivered to the Stockholders’ Agent on or prior to the First Escrow Release Date in accordance with this Article VIII. The Any portion of the First Distribution Amount held by the Escrow Agent following the First Escrow Release Date with respect to pending but unresolved claims for indemnification that is not awarded to Acquirer upon the resolution of such claims shall be distributed by the Escrow Agent to the Converting Holders within five Business Days following resolution of such claims and in accordance with each such Converting Holder’s Pro Rata Share of such portion of the First Distribution Amount. (c) Within five Business Days following the Second Escrow Release Date, the Escrow Agent will distribute to each Converting Holder such Converting Holder’s Pro Rata Share of the Escrow Fund less any portion of the Escrow Amount contributed Fund with respect to pending but unresolved claims set forth in a valid Claims Certificate, to be necessary to satisfy all unsatisfied or disputed claims for indemnification specified in any Claim Certificate delivered to the Stockholders’ Agent on behalf or prior to the Second Escrow Release Date in accordance with this Article VIII. Any portion of each Shareholder the Escrow Fund held by the Escrow Agent following the Second Escrow Release Date with respect to pending but unresolved claims for indemnification that is not awarded to Acquirer upon the resolution of such claims shall be as provided under Section 2.04. The Shareholders shall indemnify distributed by the Escrow Agent to the Converting Holders within five Business Days following resolution of such claims and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses in accordance with each such Converting Holder’s Pro Rata Share of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty such portion of the Company contained in this Agreement, Escrow Fund. (iid) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any Any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent a Converting Holder shall be entitled to recover in accordance with the cash and stock allocations set forth on the Spreadsheet, it being understood and agreed that Unaccredited Stockholders shall first be paid their Pro Rata Share of such distribution in cash and all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof other Converting Holders shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary paid their Pro Rata Share of the Company in respect remainder of any taxable year (or portion thereof) ending on or prior to the Expiration Datesuch distribution.

Appears in 1 contract

Sources: Merger Agreement (Pandora Media, Inc.)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined belowa) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after At the Effective Time, Acquirer shall withhold the Cash Escrow Amount, without any act of any Shareholder, will be deposited Amount from the Merger Consideration payable pursuant to Section 1.3(a) and shall deposit the Cash Escrow Amount with J.▇. ▇▇▇▇▇▇ Trust Company, PNC National Association (or other institution acceptable to Parent and the Shareholder Representative) Bank as Escrow Agent escrow agent (the “Escrow Agent”)) (the aggregate amount of cash so held by the Escrow Agent from time to time, such deposit to constitute an escrow fund (the “Escrow Fund”) to ), which Escrow Fund shall be governed by this Agreement and the terms set forth hereinescrow agreement in substantially the form attached hereto as Exhibit G with such changes as Acquirer and the Members’ Agent may agree in writing (the “Escrow Agreement”). The Escrow Fund shall constitute partial security for the benefit of Acquirer (on behalf of itself or any other Acquirer Indemnified Person) with respect to any Indemnifiable Damages pursuant to the indemnification obligations of the Converting Holders under Section 1.6(h) and this Article VIII. Subject to Section 8.4, the Escrow Agent shall hold the Escrow Fund until 11:59 p.m. local time on April 1, 2020 (the “Escrow Release Date”). Neither the Escrow Fund (including any portion thereof) nor any beneficial interest therein may execute this Agreement be pledged, subjected to any Encumbrance, sold, assigned or transferred by any Converting Holder or be taken or reached by any legal or equitable process in satisfaction of any debt or other Liability of any Converting Holder, in each case prior to the distribution of the Escrow Fund to any Converting Holder in accordance with Section 8.1(b), except that each Converting Holder shall be entitled to assign such Converting Holder’s rights to such Converting Holder’s Pro Rata Share of the Escrow Fund by will, by the laws of intestacy or by other operation of law. (b) Within two Business Days following the date hereofEscrow Release Date, and the Escrow Agent will distribute to each Converting Holder such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as Converting Holder’s Pro Rata Share of the date hereof between the other signatories hereto. The Escrow Fund less that portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officersFund that is determined, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language reasonable judgment of Acquirer, to the contrary, the Parent may not receive be necessary to satisfy all unsatisfied or disputed claims for indemnification specified in any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Claim Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Members’ Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Release Date in accordance with this Article VIII. Any portion of the Escrow Fund held by the Escrow Agent following the Escrow Release Date with respect to pending but unresolved claims for indemnification that is not awarded to Acquirer upon the resolution of such claims shall be distributed by the Escrow Agent to the Converting Holders within two Business Days following resolution of such claims and in accordance with each such Converting Holder’s Pro Rata Share of such portion of the Escrow Fund.

Appears in 1 contract

Sources: Merger Agreement (Farfetch LTD)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company's shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholdershareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholdershareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other an institution acceptable to Parent and the Shareholder Representative) Securityholder Agents as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder shareholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). No portion of the Escrow Amount shall be contributed in respect of any Company Options or warrants. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company or any contained in this AgreementArticle II herein (as modified by the Company Schedules), (ii) or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against herein. Parent and the Company as of each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Nothing herein shall have any right to contribution from limit the liability of the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect breach of any Loss subject to indemnification pursuant to this Article 8 unless representation, warranty or covenant if the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and Merger does not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Dateclose.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Netscape Communications Corp)

Escrow Fund. As security for (a) At the indemnity provided for Closing, 80,000 shares of fonix Common Stock (the "Escrow Shares") shall be registered in this Article 8 the name of, and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.Durham, Evans, Jones & Pinegar, P.C. (. ▇ ▇the▇ ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and tution selected by fonix with the Shareholder Representativereasonable consent of AcuVoice) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the Escrow Fund”) Fund and to be governed by the terms set forth herein. herein and in the Escrow Agreement attached hereto as Exhibit C. The Escrow Agent may execute this Agreement following Fund shall be available to compensate fonix pursuant to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as indemnification obligations of the date hereof between shareholders of AcuVoice as set forth in Section 8.2. In the other signatories hereto. The portion event fonix issues any Additional Escrow Shares (as defined below), such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Escrow Shares delivered at the Closing. (b) Except for dividends paid in paragraph stock declared with respect to the Escrow Shares (e) below in "Additional Escrow Shares"), which case Parent shall be entitled treated pursuant to recover all Losses including the Basket Amount; providedSection 8.l(a) hereof, howeverany cash dividends, that dividends payable in securities or other distributions of any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company kind made in respect of any taxable year (or portion thereof) ending on or prior the Escrow Shares will be delivered to the Expiration Dateshareholders of AcuVoice on a pro rata basis. Each shareholder of AcuVoice will have voting rights with respect to the Escrow Shares deposited in the Escrow Fund with respect to such shareholder so long as such Escrow Shares are held in escrow, and fonix will take all reasonable steps necessary to allow the exercise of such rights. While the Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement, the shareholders of AcuVoice will retain and will be able to exercise all other incidents of ownership of said Escrow Shares which are not inconsistent with the terms and conditions of this Agreement.

Appears in 1 contract

Sources: Merger Agreement (Fonix Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below1) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, a portion of the shares of AmeriNet's Common Stock to be issued in the Merger equal to the Escrow AmountNumber [as defined in paragraph 1.6(B)(7)(iv)] (plus any additional New Shares [as defined below] as may be issued in respect thereof after the Closing; collectively, the "Escrow Shares"), without any act of any Shareholderstockholder, will be registered in the name of a person designated from time to time for such purpose by AmeriNet as escrow agent (the "Escrow Agent") and will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other a financial institution acceptable to Parent AmeriNet and the Shareholder RepresentativeAgent [as defined in Section 7.2(H) as Escrow Agent (the “Escrow Agent”below)], such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. at AmeriNet's sole cost and expense. (a) The portion of AmeriNet Common Stock in the Escrow Amount Fund contributed on behalf of each Shareholder stockholder of WRI is listed opposite such stockholders' name on Exhibit 7.2(A). (b) The Escrow Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate AmeriNet and its officersaffiliates for any claim, directors and affiliates (the “Indemnified Parties”) harmless against all claimsloss, lossesexpense, liabilities, damages, deficiencies, costs and expensesliability or other damage, including reasonable attorneys' fees and expenses that AmeriNet or any of investigation (hereinafter individually a “Loss” and collectively “Losses”) its affiliates has incurred or reasonably anticipates incurring by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty reason of the Company breach by WRI of any representation, warranty, covenant or agreement of WRI contained in this Agreementherein, (iicollectively, "Losses"), but only to the extent that such Losses exceed $30,000. (c) any failure by the Company AmeriNet and WRI each acknowledge that such Losses, if any, would relate to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of unresolved contingencies existing at the Effective Time. No Shareholder , which if resolved at the Effective Time would have led to a reduction in the total number of shares of AmeriNet Common Stock that AmeriNet would have agreed to issue in connection with the Merger. (3) Nothing herein shall have any right to contribution from limit the Company liability of WRI for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language Resort to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect shall be the exclusive contractual remedy of any Loss subject to indemnification pursuant to this Article 8 unless the amount of AmeriNet and its affiliates for any such Loss equals or exceeds $25,000 breaches and until an Officers’ Certificate identifying Losses, which in misrepresentations if the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountMerger does close; provided, however, that nothing herein shall limit any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datenoncontractual remedy for fraud.

Appears in 1 contract

Sources: Merger Agreement (Amerinet Group Com Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's stockholders ----------- will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ U.S. Bank Trust Company, National Association NA (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund ------------ (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's ----------- cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). No portion of the Escrow Amount shall be contributed in respect of any Company Options or warrants. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively ---- "Losses") incurred by Parent, its officers, directors, or affiliates (including ------ the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company or any contained in this AgreementArticle II herein (as modified by the Company Schedules), (ii) any failure by the Company to perform or comply with any covenant contained in this Agreementherein, or (iii) any action, suit or proceeding which is pending or threatened against the payment of $500,000 in connection with the obligation of the Company as set forth in Schedule 2.19, which payment shall be deemed a "Loss" for purposes of this Agreement (the "Fee Payment") or (iv) the payment by the Parent of cash to Imperial Bank in connection with the exercise of the Effective Timeput right contained in that certain Warrant dated June 27, 1997 (the "Warrant Payment"). No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)75,000, have been delivered to the Escrow Agent as provided in paragraph (e) below and such amount is determined pursuant to this Article VII to be payable; in which case such case, Parent shall be entitled may recover shares from the Escrow Fund equal in value to recover all Losses including the Basket Amountindemnified Losses; provided, however, that any Loss resulting in connection with the ----------------- Fee Payment, Parent shall receive shares from the inaccuracy or breach of Escrow Fund immediately following the Closing in an amount equal to the Fee Payment and/or the Warrant Payment (in accordance with Section 2.03(c), 4.05 or 6.20 hereof 7.2(d)(ii) below) and such shares shall be recoverable from the first dollar and not subject paid without regard to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date$75,000 limitation referenced above.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Inktomi Corp)

Escrow Fund. As security for (a) Pursuant to Section 1.4 of the indemnity provided for Purchase Agreement, on the Closing Date, Purchaser shall make or cause to be made available to the Escrow Agent, the Escrow Cash. Exhibit A-1 attached hereto sets forth (i) the name, address and taxpayer identification number of each Seller, and (ii) the pro rata share of each Seller in this Article 8 the Escrow Fund (each, the “Seller’s Pro Rata Share”). Exhibit A-2, to be attached hereto on the Closing Date, shall set forth (i) the name, address and by virtue taxpayer identification number of each participant in the Employee Bonus Plan (a "Participant”), and (ii) the initial allocation of the Escrow Fund among the Participants (subject to the provisions of Section 7 below). The Escrow Agent agrees to accept delivery of the Escrow Cash and to hold such Escrow Cash in escrow subject to the terms and conditions of this Agreement and the Purchase Agreement. (b) As of any particular time, the Shareholders will Escrow Agent may assume, without inquiry, that the Escrow Cash that shall have been or caused to be deemed to have received and deposited with the Escrow Agent (as defined below) by Purchaser is all of the Escrow Amount (plus any additional shares as may Cash required to be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to held in the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, Fund by the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent Agent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereinthat Exhibit A s A-1 and A-2 remain correct and in full force and effect. The Escrow Cash shall be held and distributed by the Escrow Agent may execute this Agreement following in accordance with the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as provisions of the date hereof between Purchase Agreement and this Agreement. Neither the Escrow Cash nor any beneficial interest therein may be pledged, encumbered, sold, assigned or transferred (including any transfer by operation of law), by the Escrow Agent, Purchaser, any Seller or any Participant or be taken or reached by any legal or equitable process in satisfaction of any debt or other signatories hereto. The portion liability of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent, Purchaser, any Seller or any Participant, (and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty in case of the Company contained Sellers or the Participants, prior to the distribution to each in accordance with this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”if any), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Bonus Plan/Documents Escrow Agreement (Answers CORP)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholdershareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Chase Manhattan Bank and Trust Company, National Association N.A. (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 8.2(h) below)) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shareholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock to which such holder would otherwise be entitled under Section 2.041.6(b) and shall be in the respective share amounts and percentages listed opposite each Company's shareholder's names listed in a schedule to be executed by the Company and delivered to Parent at Closing (the "ESCROW SCHEDULE"). The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (including the “Indemnified Parties”Surviving Corporation) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained herein (or in any certificate, instrument, schedule or document attached to this AgreementAgreement and delivered by the Company in connection with the Merger), (ii) any failure by the Company to perform or comply with any covenant or obligation contained in this Agreement, herein or (iii) any action, suit claims brought by employees or proceeding which is pending or threatened against consultants of the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language who were or are terminated prior to the contraryClosing; provided that such claims must be asserted on or before 5:00 p.m. (California Time) on the Expiration Date. Except as otherwise provided herein, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in Section 8.2(d) below) identifying Losses, the aggregate amount of which exceed $50,000 (except in the aggregate exceed $1,000,000 (the “Basket Amount”case of Losses arising from any breach or inaccuracy of Section 2.3, as to which such threshold shall not apply), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.as

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Niku Corp)

Escrow Fund. As security for The escrow fund (the indemnity provided for "Escrow Fund") shall consist of ----------- ----------- the following: (i) that number of shares of Acquiror Common Stock determined by dividing the Escrow Amount by the Base Price (the "Indemnification Escrow ---------------------- Shares"), which shares shall be deposited into the Escrow Fund at the Effective ------ Time; and (ii) Any additional shares of Acquiror Common Stock or other equity securities that are issued or distributed by Acquiror (including shares issued upon a stock split) with respect to the Indemnification Escrow Shares (the "New Shares," and together with the Indemnification Escrow Shares, the ---------- "Escrow Shares") in accordance with Section 1.7.1(d) of the Merger Agreement, ------------- ---------------- which shares shall be deposited into the Escrow Fund as of the date of such issuance or distribution and become part of the Escrow Shares. Exhibit A to this Article 8 Agreement sets forth the name of each Shareholder and the --------- number of Indemnification Escrow Shares to be contributed to the Escrow Fund at the Effective Time on behalf of each such Shareholder pursuant to Section ------- 1.7.1(d) of the Merger Agreement. The value of the Indemnification Escrow Shares -------- contributed by virtue each Shareholder, divided by the aggregate value of the Indemnification Escrow Shares contributed by all Shareholders, each valued in accordance with Section 4(c) of this Agreement, shall be each such Shareholder's ------------ "proportionate interest" in the Shareholders will be deemed Escrow Shares. Before or concurrent with the execution and delivery of this Agreement, and upon each issuance of New Shares, Acquiror and the Shareholder Representative shall deliver to have received and deposited with the Escrow Agent (as defined below) a writing setting forth the number of Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) Shares deemed to be governed by the terms set forth hereineach Shareholder's proportionate interest. The Escrow Agent may execute this Agreement following shall have no duty to confirm or verify the date hereofsufficiency, and such later execution, if so executed after the date hereof, shall not affect the binding nature appropriateness or accuracy of this Agreement as any amount of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directorsShares deposited with it, or affiliates (including the Surviving Corporation) directly or indirectly as a result proportionate interest of (i) any inaccuracy or breach of a representation or warranty of the Company contained Shareholder in such Escrow Shares, under this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Escrow Agreement (Watchguard Technologies Inc)

Escrow Fund. As soon as reasonably practicable after the Closing and the date of issuance of the First Milestone Shares and the Second Milestone Shares, as applicable, the Escrow Shares shall be registered in the name of, and be deposited with, State Street Bank and Trust Company of California, N.A., (or another institution selected by Purchaser with the reasonable consent of the Company and the Sellers' Representative) as escrow agent (the "Escrow Agent"), such deposit (together with interest and other income thereon) to constitute the "Escrow Fund" and to be governed by the terms set forth herein and in the Escrow Agreement attached hereto as Exhibit E. As security for the indemnity provided for in this Article 8 Section 8.2 hereof and by virtue of this Agreement, the Shareholders Sellers will be deemed to have received and deposited with the Escrow Agent the Escrow Fund without any act of any Seller. The Escrow Fund shall be available to compensate the Indemnified Parties, or any of them, for any claims by such Indemnified Parties for any Losses suffered or incurred by them; provided, however, that if the Escrow Period (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock splithas terminated, stock dividend or recapitalization effected by Parent after the Effective Time and a claim for Losses is made with respect to (i) fraud, (ii) knowing, intentional or willful breaches by the Company or the Sellers of their respective representations, warranties or covenants, or (iii) breaches by the Company or the Sellers of their respective representations and warranties in Sections 2.2, 2.9, 2.12 and 3.2 hereof, the claim shall be made directly against the Sellers severally and not jointly pro rata in proportion to their interest in the Escrow AmountFund. In no event shall any Seller be personally liable to Purchaser for any amounts in excess of the value of the Purchaser Shares received by such Seller, which shares shall be valued at the Purchaser Stock Price, as adjusted for Net Taxes (as defined below) without and brokerage fees actually paid by such Seller, except that personal liability for breaches of the representations and warranties set forth in Section 2.12 shall be limited to fifty percent (50%) of the value of the Purchaser Shares received by such Seller, which shares shall be valued at the Purchaser Stock Price, as adjusted for Net Taxes and brokerage fees actually paid by such Seller. "Net Taxes" shall consist of the taxes actually paid by such Seller in connection with the receipt of the Purchaser Shares hereunder, as adjusted for any act tax benefits which are reasonably probable of any Shareholderbeing realized by such Seller as a result of such personal liability. As soon as practicable after Notwithstanding anything set forth herein to the Effective Timecontrary, the Founders' Escrow AmountShares shall be used solely to compensate the Indemnified Parties, without or any act of them, for any Shareholderclaims by such Indemnified Parties for any Blenda Losses suffered or incurred by them, will be deposited with J.▇. ▇and not for any ▇▇▇▇▇ Trust CompanyLosses, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit be deemed not to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion a part of the Escrow Amount contributed on behalf of each Shareholder Fund for any other purpose. Nothing herein shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (limit the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty liability of the Company contained in this Agreementfor any breach or inaccuracy of any representation, (ii) any failure by the Company to perform warranty or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against Agreement if the Company as of the Effective TimeShare Purchase does not close. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent Purchaser may not receive any distribution from the Escrow Fund in respect of compensation for any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate one or more Officer's Certificates (as defined below) identifying Losses, which Losses in excess of $750,000 in the aggregate exceed $1,000,000 (the "Basket Amount”), ") has or have been delivered to the Escrow Agent as provided in paragraph (eSection 8.3(d) below hereof, in which case Parent Purchaser shall be entitled to recover all Losses including so identified. Notwithstanding the Basket Amount; providedforegoing, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof Purchaser shall be recoverable from entitled to receive payments out of the first dollar Escrow Fund for, and not subject to the Basket Amount nor shall it be included in calculating whether not apply as a threshold to any and all claims or payments made with respect to breaches of the Basket Amount has otherwise been exceeded; representations and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary warranties of the Company and the Sellers contained in Sections 2.2, 2.21 and 3.2 or with respect of to any taxable year (or portion thereof) ending on or prior to the Expiration DateBlenda Losses.

Appears in 1 contract

Sources: Share Purchase Agreement (Com21 Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company's stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other an institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). No portion of the Escrow Amount shall be contributed in respect of any Company Options or Warrants. The Shareholders Escrow Fund shall indemnify and hold be available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including including, with respect to claims asserted by third parties, reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, Article II herein (ii) any failure as modified by the Company Disclosure Schedules, without giving effect to perform any update thereto), or comply with any breach by the Company of any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amountherein; provided, however, that Parent may not receive any Loss resulting shares from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar Escrow Fund unless and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; until (and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced then only to the extent that) such Losses exceed in the aggregate $500,000. Parent and the Company each acknowledge that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentLosses, if any, would relate to unresolved contingencies existing at the CompanyEffective Time, or any Subsidiary which if resolved at the Effective Time would have led to a reduction in the aggregate Merger Consideration. Nothing herein shall limit the liability of the Company in respect for any breach of any taxable year (representation, warranty or portion thereof) ending on or prior to covenant if the Expiration DateMerger does not close.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Russo Paul M)

Escrow Fund. As security for (a) Upon the indemnity provided for in this Article 8 and by virtue of this AgreementClosing, the Shareholders Cash Escrow Amount and the Stock Escrow Amount will be deemed to have received and deposited into an escrow account with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent specified in Section 1.4 (the “Escrow Agent”)aggregate amount of cash and shares of Buyer Common Stock so held in escrow from time to time, together with interest, if any, and other income earned on such deposit to constitute an escrow fund (cash and stock dividends declared and paid in respect of such shares, the “Escrow Fund”) to be governed by the terms set forth hereinserve as collateral and partial security for certain rights of Buyer hereunder. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language Except to the contrary, the Parent may not receive any distribution from extent there is a cancellation of shares of Buyer Common Stock held in the Escrow Fund in respect connection with any Damages, shares of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which Buyer Common Stock held in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent Fund shall be treated by Buyer as provided in paragraph (e) below in which case Parent issued and outstanding stock of Buyer and Sellers shall be entitled to recover all Losses including exercise voting rights in accordance with the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary terms of the Company in Escrow Agreement and to receive dividends with respect of any taxable year to such shares. (or portion thereofb) ending on At or prior to the Expiration Closing, Buyer and Sellers’ Representative shall designate Deutsche Bank to act as escrow agent in connection with the transactions contemplated by this Agreement (the “Escrow Agent”) pursuant to the terms of an escrow agreement substantially in the form of Exhibit C (the “Escrow Agreement”), which provides, among other things, for releases from the Escrow Fund, as necessary, to secure the rights of Buyer as set forth in ARTICLE VII. At the Closing, Buyer shall deposit the Cash Escrow Amount and Buyer shall deposit the Stock Escrow Amount, in each case, with the Escrow Agent. The Cash Escrow Amount and the Stock Escrow Amount shall be held, administered and released by the Escrow Agent in accordance with the terms of the Escrow Agreement. (c) The funds and shares of Buyer Common Stock held in the Escrow Fund shall be released as follows: (i) to each Seller, on the first anniversary of the Closing Date (the “First Escrow Release Date”), such Seller’s Pro Rata Share of the First Escrow Release Amount; (ii) to each Seller, on the second anniversary of the Closing Date (the “Second Escrow Release Date”, and, together with the First Escrow Release Date, the “Escrow Release Dates”), such Seller’s Pro Rata Share of the Second Escrow Release Amount; and (iii) to each Seller, after the Second Escrow Release Date, such Seller’s Pro Rata Share of any funds and/or shares of Buyer Common Stock held in the Escrow Fund to secure pending claims for indemnification pursuant to ARTICLE VII, to the extent not released to Buyer in connection with such claims, as the case may be, upon the earlier of (A) the final resolution of such pending claim and (B) if no Action has been commenced with respect to such pending claim, on the six (6) month anniversary of the Second Escrow Release Date. (d) The parties hereto acknowledge and agree that Buyer shall be responsible for any initial setup fees associated with the establishment of the Escrow Fund as well as for any remaining fees, costs and expenses associated with the maintenance of the Escrow Fund.

Appears in 1 contract

Sources: Share Purchase Agreement (Mitek Systems Inc)

Escrow Fund. As security (a) At the Closing, the Indemnification Escrow Shares and the Primo Escrow Shares (collectively, the “Escrow Shares”) shall be registered in the name of the Escrow Agent, but for the indemnity provided for in this Article 8 and by virtue benefit of this Agreement, the Shareholders will be deemed holders of the Outstanding TARGET Series E-3 Shares immediately prior to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to and the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeManagement Members, the Escrow Amount, without any act of any Shareholder, will and shall be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent reasonably acceptable to Parent TARGET and the Shareholder Representative) as Escrow Agent PURCHASER (the “Escrow Agent”), with such deposit and any Additional Escrow Shares to constitute an the escrow fund (the “Escrow Fund”) and to be governed by the terms set forth hereinherein and in the Escrow Agreement in substantially the form of Exhibit 8 hereto (the “Escrow Agreement”). The Indemnification Escrow Agent may execute this Agreement following Shares (but not the date hereofPrimo Escrow Shares) shall be available to compensate PURCHASER pursuant to the indemnification obligations of the holders of the Outstanding TARGET Shares immediately prior to the Effective Time and the Management Members, and such later execution, if so executed after the date hereof, Primo Escrow Shares (but not the Indemnification Escrow Shares) shall not affect be held in escrow and shall be released in accordance with the binding nature further provisions of this Article 12 and the Escrow Agreement as either to the PURCHASER or to the holders, immediately prior to the Effective Time, of the date hereof between Outstanding TARGET Series E-3 Shares and the other signatories heretoManagement Members. The portion In the event PURCHASER issues any Additional Escrow Shares, such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates Agent (for the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty benefit of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as holders of the Effective Time. No Shareholder shall have any right Outstanding TARGET Series E-3 Shares immediately prior to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in Time and the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 Management Members) and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as the Escrow Shares delivered at the Closing. (b) Except for dividends paid in stock declared with respect to the Escrow Shares (“Additional Escrow Shares”), which shall be treated as Escrow Shares pursuant to Section 12.1(a) hereof, any cash dividends, dividends payable in securities or other distributions of any kind made in respect of the Escrow Shares will be delivered to the holders of the Outstanding TARGET Series E-3 Shares immediately prior to the Effective Time and the Management Members based on each such holder’s or member’s Proportionate Share thereof. Subject to Section 3.5 hereof, each such holder and member shall have voting rights with respect to the Escrow Shares deposited in the Escrow Fund with respect to such holder’s or member’s Proportionate Share thereof so long as such Escrow Shares are held in escrow, and PURCHASER will take all reasonable steps necessary to allow the exercise of such rights. While the Escrow Shares remain in the Escrow Agent’s possession pursuant to this Agreement and the Escrow Agreement, the holders of Outstanding TARGET Series E-3 Shares immediately prior to the Effective Time and the Management Members shall retain and shall be able to exercise all other incidents of ownership of such Escrow Shares which are not inconsistent with the terms and conditions of this Agreement. (c) No fractional shares shall be released and delivered from escrow to any holder of Outstanding TARGET Series E-3 Shares immediately prior to the Effective Time or any Management Member. In lieu of any fraction of an Escrow Share to which any such Person would otherwise be entitled, such Person will receive from PURCHASER an amount of cash (rounded to the nearest whole cent) equal to the product of such fraction multiplied by the Average Stock Price. (d) Unless and until such shares shall have been released to the holders, immediately prior to the Effective Time, of Outstanding TARGET Series E-3 Shares or to Management Members, no Escrow Shares or Additional Escrow Shares or any beneficial interest therein may be taken or reached by any legal or equitable process in satisfaction of any debt or other liability of any such shares by the Escrow Agent as provided in paragraph herein. (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject Subject to the Basket Amount nor shall it be included in calculating whether terms of the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentEscrow Agreement, the CompanyEscrow Agent is granted the power, or any Subsidiary effective as of the Company Closing, to effect any transfer of Escrow Shares contemplated by this Agreement. PURCHASER will cooperate with the Escrow Agent in respect of any taxable year (or portion thereof) ending on or prior promptly issuing stock certificates to the Expiration Dateeffect such transfers.

Appears in 1 contract

Sources: Merger Agreement (Verso Technologies Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited (a) Concurrently with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act action by any holder of any ShareholderCompany Common Stock, will that number of Initial Parent Shares equal to the quotient obtained by dividing (x) $10,500,000 by (y) the Parent Closing Price (such shares being the “Escrow Shares”) shall be deposited with J.▇. ▇▇▇▇▇▇ American Stock Transfer & Trust Company, National Association LLC (or such other institution acceptable to mutually selected by Parent and the Shareholder RepresentativeCompany) as Escrow Agent escrow agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) ” and to be governed by the terms set forth hereinherein and in an escrow agreement among Parent, APSLP and the Escrow Agent (the “Escrow Agreement”), the form of which is attached as Exhibit B hereto. The Escrow Agent may execute this Agreement following Shares shall be registered in the date hereofname of APSLP. Any dividends or distributions made by Parent in cash or property, and such later executionincluding shares of Parent Common Stock, if so executed after the date hereofor other Parent equity securities (including shares issued upon a stock split) (“New Shares”), shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion in respect of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall Shares that have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution been released from the Escrow Fund shall be added to the Escrow Fund, and become a part thereof. (b) APSLP (or its direct or indirect owners) shall pay any Taxes on such dividends or distributions on the Escrow Shares described in Section 2.11(a); provided, that Tax distributions shall be permitted with respect to such dividends or distributions in accordance with the Escrow Agreement. The parties hereto shall cause APSLP to have the ability to direct the voting of that number of Escrow Shares contributed to the Escrow Fund on behalf of APSLP (including on any New Shares issued or distributed by Parent in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any Escrow Shares) so long as such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which shares are held in the aggregate exceed $1,000,000 (Escrow Fund. Parent shall record the “Basket Amount”), have been delivered Parent Common Stock contributed to the Escrow Agent Fund as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar issued and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending outstanding on or prior to the Expiration Dateits balance sheet.

Appears in 1 contract

Sources: Merger Agreement (Universal American Corp.)

Escrow Fund. As security for Section 2.01. Escrow Agent shall establish a special escrow fund designated as the indemnity "GECPF/BFA/Elexsys International Escrow Fund" (the "Escrow Fund"), shall keep such Escrow Fund separate and apart from all other funds and moneys held by it and shall administer such Escrow Fund as provided for in this Article 8 and Agreement. Section 2.02. All moneys paid to Issuer by virtue Lender pursuant to Section 1.03 of this Agreement, the Shareholders will Agreement shall be deemed credited to have received and deposited with the Escrow Fund. Escrow Agent (as defined below) shall use the moneys in the Escrow Amount (plus any additional shares Fund to pay Project Costs, upon receipt with respect thereto of a Payment Request Form attached hereto as may be issued upon any stock splitExhibit A, stock dividend or recapitalization effected executed by Parent after Lender, Bank and Borrower, fully completed and with all supporting documents described therein attached thereto and the Effective Time Letter of Credit. Upon receipt of a Payment Request Form with respect to any Project Costs, an amount equal to the Project Costs as shown therein shall be paid directly to the person or entity entitled to pay as specified therein. Section 2.03. On September 30, 1997, Escrow Agent shall pay: (a) to Lender in prepayment of the Loan, an amount equal to the entire remaining balance on deposit in the Escrow Amount) without any act of any Shareholder. As soon as practicable after Fund, less the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result sum of (i) an amount equal to the Project Costs for which Escrow Agent has received a fully and properly completed Payment Request Form and which has not been paid, and (ii) the amount of any inaccuracy or breach deposit by Borrower pursuant to Section 3.04 hereof remaining on deposit in the Escrow Fund; and (b) to Borrower the entire remaining balance on deposit in the Escrow Fund less the amount referred to in clause (a)(i) of a representation or warranty this Section. The amount paid to Lender shall be applied first to interest accrued on the Loan and next to the Principal portion of the Company contained Loan Payments in this the inverse order of maturity. Section 2.04. Upon written notice (a) from Lender or Borrower that an Event of Default has occurred under the Loan Agreement, (iib) any failure by from Bank that an event of default as occurred under the Company to perform or comply with any covenant contained in this Reimbursement Agreement, or (iiic) any actionfrom Borrower that Borrower has determined not to complete the Project, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder Escrow Agent shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything liquidate all investments held in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund and transfer the proceeds thereof and all other moneys held in respect the Escrow Fund to Lender to be applied first to interest accrued on the Loan and next to the Principal portion of any Loss subject to indemnification the Loan Payments in the inverse order of maturity. Section 2.05. Escrow Agent shall only be responsible for the safekeeping and investment of the moneys held in the Escrow Fund, and the disbursement thereof in accordance with this Article, and shall not be responsible for the authenticity or accuracy of such certifications or documents, the application of amounts paid pursuant to this Article 8 unless such certifications by the amount persons or entities to which they are paid, or the sufficiency of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered moneys credited to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled Fund to recover all Losses including make the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datepayments herein required.

Appears in 1 contract

Sources: Loan Agreement (Elexsys International Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company Stockholders ----------- will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)), as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth hereinherein and at Parent's cost and expense. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred incurred, sustained or paid by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company (as modified by the Company Schedules) contained in this Agreement or any certificate, instrument or other document delivered pursuant to the terms of this Agreement, (ii) or any failure by the Company to perform or comply with any covenant contained herein, (ii) the payment by Parent or the Surviving Corporation of any amount on the account of Dissenting Shares which such payment or payments exceed the aggregate consideration that otherwise would have been payable in this Agreementrespect of such shares, (iii) the amount of any Third Party Obligations that the Company fails to satisfy pursuant to Section 5.6 above prior to the Effective Time and/or the amount of any cash in excess of the amounts set forth in Section 5.6 expended for such purpose, (iv) the payment of any Legal Expenses, or (iiiv) any action, suit or proceeding which the amount that the Final Cash Balance (as defined in Section 7.3 below) is pending or threatened against less than the Company as lesser of (A) the Effective Timeapplicable Minimum Cash Balance required in Section 5.27 and (B) the Cash Amount reflected on the Estimated Closing Date Balance Sheet. No Shareholder Nothing herein shall have any right to contribution from limit the liability of the Company for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which Losses in the aggregate exceed amount in excess of $1,000,000 2,000,000 (the “Basket "Threshold Amount”), ") have been delivered to the Escrow Securityholder Agent (as provided defined in paragraph (eg) below below), in which case event Parent shall be entitled to recover all Losses including only amounts in excess of the Basket Threshold Amount; providedprovided that notwithstanding the foregoing, howeverParent shall be entitled to indemnification on a first dollar basis, without regard to whether the Threshold Amount has been exceeded, with respect to (i) the payment by Parent or the Surviving Corporation of any amount on account of Dissenting Shares, (ii) the amount of any Third Party Obligations that the Company fails to satisfy pursuant to Section 5.6 above and/or the amount of any cash in excess of the amounts set forth in Section 5.6 expended for such purpose, (iii) the payment of any Legal Expenses, and (iv) the amount that the Final Cash Balance (as defined in Section 7.3 below) is less -52- than the lesser of (A) the applicable Minimum Cash Balance required in Section 5.27 and (B) the Cash Amount reflected on the Estimated Closing Date Balance Sheet. The Company Stockholders shall not have any right of contribution from the Company or Parent with respect to any Loss resulting from pursuant to this Article VII. For purposes of this Article VII, references to the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof terms "material," "materially," "in all material respects" and "Material Adverse Effect" shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included disregarded for purposes of determining whether there was a breach or inaccuracy in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy representation or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary warranty of the Company in respect of Article II, as modified by the Company Schedules attached hereto, or any taxable year (certificate, instrument or portion thereof) ending on or prior other document delivered pursuant to the Expiration Dateterms of this Agreement.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Ibeam Broadcasting Corp)

Escrow Fund. As security for Pursuant to the indemnity provided for in this Article 8 and by virtue terms of this the Escrow Agreement, an Escrow Fund consisting of 125,000 shares of Acquiror Common Stock to be issued as part of the Shareholders will Merger Consideration shall be deemed established and made available to have received indemnify and deposited with the Escrow Agent compensate Acquiror for any Damages (as defined in Section 9.3 below) the Escrow Amount (plus incurred by Acquiror. Target and Acquiror each acknowledge that any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later executionDamages represent contingencies that, if so executed after the date hereof, shall not affect the binding nature of this Agreement known and/or fully resolved as of the date hereof between Closing Date, would have led to negotiated reduction in the other signatories heretoMerger Consideration. Of the shares of Acquiror Common Stock forming the Escrow Fund, 50,000 shares shall be subject to payment of Damages incurred by Acquiror in connection with the matters set forth in Section 9.3(a) below (collectively, the "General Indemnity Matters"), and 75,000 shares shall be subject to payment of Damages incurred by Acquiror in connection with the matters set forth in Section 9.3(b) below (collectively, the "Specific Indemnity Matters"). The portion of the Escrow Amount contributed on behalf Fund allocated for payment of each Shareholder Damages in connection with General Indemnity Matters shall not be available for payment of Damages in connection with Specific Indemnity Matters, and the portion of the Escrow Fund allocated for payment of Damages in connection with Specific Indemnity Matters shall not be available for payment of Damages in Connection with General Indemnity Matters. If the Closing occurs, the Escrow Fund shall be as the exclusive remedy of Acquiror with respect to this Agreement and all or any aspect of the transactions contemplated herein (provided under that it is understood and acknowledged that the rights and remedies of the respective parties to the Shareholders Agreement, the Marketing Services Agreements and the Non-Competition Agreements shall be independent of this Agreement and the remedies set forth herein). However, nothing in this Section 2.04. The Shareholders 9 shall indemnify and hold Parent and its officers, directors and affiliates (limit the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result liability of (i) Target in connection with any inaccuracy Breach of any representation, warranty or breach of a representation or warranty of the Company contained covenant in this Agreement, Agreement or the Schedules hereto if the Closing does not occur or (ii) of any failure by the Company to perform or comply Shareholder in connection with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as Breach by such Shareholder of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, Shareholders Agreement or any Subsidiary of other agreement entered in to by such Shareholder in connection with the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateMerger.

Appears in 1 contract

Sources: Merger Agreement (Pre Paid Legal Services Inc)

Escrow Fund. As security for (a) Parent shall cause the indemnity provided for in this Article 8 and by virtue of this Agreement, Escrow Fund to be deposited on the Shareholders will be deemed to have received and deposited Closing Date with the Escrow Agent to be held in trust pursuant to the terms hereof and the terms of the Escrow Agreement. The Escrow Shares shall be allocated to separate accounts maintained for each of the Stockholders that are not an Unaccredited Investor based on the number of Outstanding Shares held by such Stockholder multiplied by the Per Share Escrow Amount. The Escrow Cash shall be allocated to separate accounts maintained for each of the Stockholders that are an Unaccredited Investor based on the number of Outstanding Shares held by such Stockholder, multiplied by the Per Share Escrow Amount multiplied by the Average Closing Price. Prior to seeking payment directly from any Principal Stockholder for any indemnity claim under this Article IX, the Parent Indemnified Parties shall first seek to satisfy such claim from the Escrow Fund account maintained for such Principal Stockholder in accordance with the terms of this Section 9.7 and the Escrow Agreement. To the extent the Escrow Fund account maintained for a Principal Stockholder is insufficient to pay the amount of any indemnity claim of any Parent Indemnified Party, each Parent Indemnified Party shall, subject to the other limitations set forth in this Article IX, have the right to recover such amounts from such Principal Stockholder by any means allowed by Applicable Laws. (b) If a Parent Indemnified Party asserts an indemnity claim under this Article IX or an indemnity claim under the Combination Agreement as defined belowcontemplated under Section 9.5(c) during the period beginning on the Closing Date and ending on the date that is eighteen (18) months after the Closing Date (the “Escrow Period”), the Parent Indemnified Party shall be entitled to indemnification by the Indemnifying Party in accordance with this Article IX by receiving from the Escrow Agent all or a portion of the Escrow Fund in an amount equal to the amount of such indemnity claim. For all purposes of this Article IX, the Escrow Shares shall be valued at the Average Closing Price, and such value shall be used for purposes of determining the amount of the liability of a Principal Stockholder for purposes of applying the Aggregate Cap of such Principal Stockholder, to the extent applicable. (c) To the extent any Parent Indemnified Parties are entitled to a distribution from the Escrow Fund as a result of an indemnity claim under Sections 9.1(a)(ii), 9.1(a)(iii), 9.1(a)(vi), 9.1(a)(vii) or 9.1(a)(viii), such distribution of the Escrow Fund to the Parent Indemnified Parties shall be in Escrow Shares and Escrow Cash in amounts pro rata based upon the Ownership Percentage of each Stockholder. To the extent any Parent Indemnified Parties are entitled to a distribution from the Escrow Fund as a result of an indemnity claim under Sections 9.1(a)(i), 9.1(a)(iv) or 9.1(a)(v), such distribution of the Escrow Fund to the Parent Indemnified Parties shall be in Escrow Shares and shall be distributed solely from the account maintained for the specific Principal Stockholder that is the Indemnifying Party. To the extent any Parent Indemnified Parties are entitled to assert an indemnity claim under the Combination Agreement as contemplated under Section 9.5(c), any distribution of the Escrow Fund to such Parent Indemnified Parties shall be in Escrow Shares and shall be distributed solely from the account maintained for the specific Principal Stockholder that is an indemnifying party under the Combination Agreement. (d) All claims asserted by a Parent Indemnified Party during the Escrow Period that are not resolved and satisfied (including the obligation to pay any such indemnity claim) shall be deemed to be “Pending Claims.” The dollar amount of all Losses claimed in good faith in respect of Pending Claims arising under Sections 9.1(a)(ii), 9.1(a)(iii), 9.1(a)(vi), 9.1(a)(vii) and 9.1(a)(viii) are hereinafter referred to as the “Stockholder Pending Claim Amount,” the dollar amount of all Losses claimed in good faith in respect of Pending Claims against a particular Principal Stockholder arising under Sections 9.1(a)(i), 9.1(a)(iv) and 9.1(a)(v) are hereinafter referred to as the “Principal Stockholder Pending Claim Amount” and the dollar amount of all Losses claimed in good faith in respect of Pending Claims against a particular Stockholder arising under the Combination Agreement as contemplated under Section 9.5(c) are hereinafter referred to as the “Combination Agreement Pending Claim Amount.” On the first Business Day following the last day of the Escrow Period (the “Release Date”), Parent and the Stockholder Representative shall jointly execute and deliver to the Escrow Agent written instructions instructing the Escrow Agent to release and deliver to each Stockholder, in accordance with the terms of and in the manner set forth on such instructions, the Escrow Shares or Escrow Cash, as the case may be, then held in the account maintained for such Stockholder in excess of the sum of (i) the amount of any Stockholder Pending Claim Amount multiplied by such Stockholder’s Ownership Percentage, (ii) the amount of any Principal Stockholder Pending Claim Amount against any such Stockholder that is a Principal Stockholder and (iii) the amount of any Combination Agreement Pending Claim Amount against any such Stockholder that is an indemnifying party under the applicable indemnification provision in Article XII of the Combination Agreement. An amount of the Escrow Amount Fund equal in value to any Stockholder Pending Claim Amount, any Principal Stockholder Pending Claim Amounts and any Combination Agreement Pending Claim Amount, in the aggregate, as of the Release Date will continue to be held by the Escrow Agent pursuant to the terms of the Escrow Agreement until such claim or claims have been fully resolved and the Escrow Agreement shall be deemed to be extended accordingly. (plus any additional shares as may e) The fees and expenses of the Escrow Agent shall be issued upon any stock splitborne 50% by the Stockholders and 50% by Parent. (f) Notwithstanding anything herein or in the Principal Stockholder Ancillary Documents or the Company Ancillary Documents to the contrary, stock dividend or recapitalization effected by Parent after the Effective Time each Stockholder shall have full voting rights with respect to the Escrow AmountShares held in the account maintained for such Stockholder during the period from the Closing Date unless and until such Escrow Shares are released to Parent from escrow pursuant to the terms of this Section 9.7. (g) without To the extent requested by the Stockholder Representative, simultaneously with any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to instructions by Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered Stockholder Representative to the Escrow Agent as provided in paragraph (e) below in which case accordance with this Section 9.7 to release any Escrow Shares to the Stockholders, Parent shall be entitled to recover all Losses including cause the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach cancellation of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar certificated Escrow Shares and not subject issuance of replacement certificated shares of Parent Common Stock to the Basket Amount nor shall it be included Persons and in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from denominations requested in writing by the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or Stockholders prior to the Expiration Dateissuance of such instructions.

Appears in 1 contract

Sources: Merger Agreement (Quanta Services Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 Section ----------- ------- 7.2 hereof and by virtue of this AgreementAgreement and the approval of this Agreement --- and the Merger by the Company's Board of Directors and the Company Shareholders, the Company Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Company Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Company Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ U.S. Bank Trust Company, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeCompany Shareholders) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Effective Time, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Company Shareholder shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). The -------------- By virtue of the approval of this Agreement and the Merger by the Company Board of Directors and the Company Shareholders, the Company Shareholders shall jointly agree to indemnify and hold Parent and its officers, directors and affiliates (the "Indemnified Parties") harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any actionviolation of California securities laws with respect to the Company's employee stock or stock option plan; provided, suit or proceeding however, that, except -------- ------- as set forth in Section 7.4, the aggregate amount for which is pending or threatened against the Company as of ----------- Shareholders are required to indemnify the Effective TimeIndemnified Parties shall not exceed the amount deposited in the Escrow Fund. No Shareholder The Escrow Fund shall be available to compensate Parent and its affiliates for any such Losses. The Company Shareholders shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent after the Effective Time. Notwithstanding anything in Nothing herein shall limit the preceding language to liability of the contraryCompany for any breach of any representation, warranty or covenant if the Merger does not close for reasons other than Parent's breach of its obligations hereunder. Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Officer's Certificate (as defined in paragraph (d) below) identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have Losses has been delivered to the Escrow Agent as provided in paragraph (ed) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datebelow.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Tut Systems Inc)

Escrow Fund. As security for Immediately prior to the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders will Parent shall deposit or cause to be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount in Section 5.2), in trust, $30 million in immediately available funds (plus any additional shares such amount, as it may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect decreased from time to time pursuant to the Escrow Amount) without any act of any ShareholderAgreement and together with interest accrued thereon as provided in the Escrow Agreement, being herein referred to as the "ESCROW FUND"). As soon as practicable after At the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association Company and the Stockholders' Representative (or other institution acceptable as defined in Section 9.5) shall deliver to Parent and the Shareholder Representative) as Escrow Agent for inclusion as Schedule 1 to the Escrow Agreement a schedule of all holders of Shares immediately prior to the Effective Time, the fractional interest in the Escrow Fund to which each such holder would be entitled pursuant to clause (ii) of Section 1.6(a) (assuming such holder does not pursue its dissenter's rights as set forth in Section 1.8 and surrenders all certificates representing its Shares) (as to such holder, the "ESCROW PERCENTAGE") and the portion of such Escrow Agent”Percentage, if any, which is to remain contingent upon such holder surrendering certificates representing Shares or complying with the procedures set forth in Section 1.9(e), such deposit . All matters relating to constitute an escrow fund (the Escrow Fund”) , to the extent not referred to in this Agreement, shall be governed by the Escrow Agreement, PROVIDED, HOWEVER, that, in the event of any conflict between the terms set forth hereinof this Agreement and the Escrow Agreement, the terms of this Agreement shall be controlling. The Escrow Agent may execute this Agreement following shall hold, invest, reinvest and disburse the date hereof, and such later execution, if so executed after Escrow Fund in accordance with the date hereof, Escrow Agreement. The Escrow Fund shall not affect the binding nature of this Agreement as of the date hereof between the be used for any other signatories heretopurpose. The portion right of the Escrow Amount contributed on behalf any person who was a holder of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company Shares immediately prior to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right Time to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution payment from the Escrow Fund shall not be transferable or assignable in respect any manner whatsoever except by order of any Loss subject to indemnification pursuant to this Article 8 unless a court of competent jurisdiction, by will or by the amount laws of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Dateintestate succession.

Appears in 1 contract

Sources: Agreement and Plan of Merger (Quality Food Centers Inc)

Escrow Fund. As security for Notwithstanding anything to the indemnity provided for contrary set forth in this Article 8 and by virtue of this Agreement, at the Shareholders Closing, the Buyer shall withhold from the portion of the Acquisition Consideration otherwise payable to each Company Shareholder and each holder of Vested Company Options in the Acquisition pursuant to Section 1.1 (i) an amount equal to the Pro Rata Share of such Company Shareholder or holder of Vested Company Options multiplied by the Escrow Amount (which amount will consist of cash and shares of Parent Common Stock (based on the Parent Average Trading Price) as per the ratio of such aggregate components set forth in the Payment Spreadsheet), and (ii) an amount of cash consideration (rounded to the nearest cent) equal to the Pro Rata Share of such Company Shareholder or holder of Vested Company Options multiplied by Adjustment Withheld Amount; each cash amount to be deemed so withheld shall be rounded to the nearest cent, and each number of shares of Parent Common Stock to be so withheld shall be rounded down to the nearest whole number and additional cash shall be withheld in lieu of the fraction of a share of Parent Common Stock that should have received been withheld. At the Closing, the Buyer shall deposit, or cause to be deposited, the Escrow Amount and deposited the Adjustment Withheld Amount with the Escrow Agent (such amounts being referred to herein as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund” and the “Adjustment Fund, respectively), that shall hold such funds in two separate accounts. The Escrow Fund and the Adjustment Fund shall be held and distributed pursuant to and in accordance with the provisions of this Agreement and the Escrow Agreement. If upon receipt of executed and completed Letters of Transmittal after Closing and a completed Shareholder Confirmation, it transpires that there are Company Shareholders, other than the 102 Trustee, that certify, by duly executed and completed Shareholder Confirmation, that they are Unqualified Shareholders, then their contribution to the Escrow Amount shall be corrected such that it will be entirely in cash, and in such case, the Buyer shall transfer to the Escrow Agent promptly any additional amount of cash as is necessary to cause the Pro Rata Share of each such Company Shareholder in the Escrow Fund to be fully in cash, and any excess shares of Parent Common Stock held by the Escrow Agent with respect to each such Company Shareholder’s Pro Rata Share will be returned to Parent. The shares of Parent Common Stock held in the Escrow Account may be subject to Hedging Transactions (as defined in the Lock Up Agreement) to be governed conducted by and in accordance with instructions from the terms set forth hereinRepresentative (with the approval of the Advisory Committee formed under the Engagement Agreement). The parties to the Escrow Agreement shall execute such documents and instruments as is necessary to facilitate such Hedging Transactions including any deposit of shares with a designated broker that conducts such Hedging Transaction. Within the ninety (90) days following the lock up period, Escrow Agent will, upon instructions from the Representative (with the approval of the Advisory Committee formed under the Engagement Agreement), sell on the NYSE or such other stock exchange on which the Parent Common Stock is then traded the shares of Parent Common Stock deposited in the Escrow Fund, provided that no more that 25% of the shares of Parent Common Stock deposited in the Escrow Fund at Closing may execute this Agreement following the date hereofbe sold on any trading day, and the proceeds of all such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder sales shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained deposited in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect cash. The members of the Advisory Committee formed under the Engagement Agreement shall have no Liability to any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company Securityholders in respect connection with the Hedging Transactions and the sales of any taxable year (or portion thereof) ending on or prior shares of Parent Common Stock referred to the Expiration Datein this Section 1.3(d).

Appears in 1 contract

Sources: Share Purchase Agreement (Harman International Industries Inc /De/)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeEarnout funds become available, the Escrow Amount, without any act of any Shareholdershareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyFargo Bank West, National Association N.A., (or other institution acceptable to Parent Tarantella and the Shareholder RepresentativeShareholders’ Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the “Escrow Agent”), such deposit deposits to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereinherein and at Tarantella’s cost and expense. Pursuant to Section 1.7(e), the first $300,000 of any Earnout payments or buyout pursuant to Section 1.7(g) shall be used to fund the Escrow Fund. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent available to compensate Tarantella and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses, and expenses of investigation and defense (hereinafter individually a “Loss” and collectively “Losses”) incurred by ParentTarantella, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company New Moon or any such representation or warranty contained in this AgreementArticle II herein (as modified by New Moon Schedules), or (ii) any failure by the Company New Moon to perform or comply with any covenant contained herein, in this Agreementeach case, or (iii) disregarding, the phrases “material”, “materially,” “in all material respects,” “Material Adverse Effect” and any actionsimilar phrase. Tarantella and New Moon each acknowledge that such Losses, suit or proceeding which is pending or threatened against the Company as of if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Nothing herein shall have any right to contribution from limit the Company liability of New Moon for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language to the contrary, the Parent Tarantella may not receive any distribution monies from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer’s Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)5,000, have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case Parent such case, Tarantella may recover from the Escrow Fund the total of its Losses, including the first $5,000. In the event the Losses exceed the amount then in the Escrow Fund, Tarantella shall be entitled permitted to recover all off-set any subsequent payment of the Minimum Earnout or buyout pursuant to Section 1.7 hereof until the Losses including have been paid; provided that, in no event shall the Basket Amount; provided, however, that amounts deposited in the Escrow Fund and any Loss resulting additional amounts withheld from the inaccuracy Minimum Earnout or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datebuyout exceed $600,000 when aggregated.

Appears in 1 contract

Sources: Merger Agreement (Tarantella Inc)

Escrow Fund. As security for Section 2.01. The Escrow Agent shall establish a special escrow fund designated as the indemnity “Loudoun County Public Schools 2012 Escrow Fund”, shall keep such Escrow Fund separate and apart from all other funds and moneys held by it and shall administer such Escrow Fund as provided for in this Article 8 and by virtue of this Escrow Agreement, the Shareholders will be deemed to have received and . Section 2.02. All moneys deposited with the Escrow Agent (as defined below) by Lessor pursuant to Section 1.03 of the Escrow Amount (plus any additional shares as may Agreement shall be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect credited to the Escrow Amount) without any act of any ShareholderFund. As soon as practicable after The Escrow Agent shall use the Effective Time, moneys in the Escrow AmountFund to pay the price of each item of Equipment subject to the Lease, without any act upon receipt with respect thereto of any Shareholdera Requisition Form attached to the Lease as Exhibit D (a copy of which is attached hereto), will be deposited with J.▇. executed by ▇▇▇▇▇▇ Trust Companyand Lessee, National Association fully completed.. Upon receipt of a Requisition Form with respect to any item of Equipment, an amount equal to the price as shown therein shall be paid directly to the person or entity entitled to payment as specified therein or paid to Lessee, if Lessee has paid for the Equipment. Section 2.03. On August 26, 2015 (or other institution acceptable as such date may be amended from time to Parent and the Shareholder Representative) as Escrow Agent (time pursuant to Section 7.08 hereof, the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow FundDate”) the Escrow Agent shall pay to Lessor an amount equal to the entire remaining balance on deposit in the Escrow Fund including interest earnings contained therein, if any, less the amount equal to the contract price of all items of Equipment for which Escrow Agent has received a fully and properly completed Requisition Form in the form provided in Exhibit D and which has not been paid. The amount paid to Lessor, pursuant to this Section, shall be governed applied to the Lease Payments and any other amounts due under the Lease, all as determined by Lessor. Upon payment as described in the terms set forth hereinpreceding sentence, Lessor shall prepare a revised amortization schedule (which shall be effective only upon the consent of Lessee) reflecting such payment. Section 2.04. Upon receipt of written notice from Lessor that an Event of Default has occurred and is continuing, the Escrow Agent shall transfer all other moneys held in the Escrow Fund to Lessor, provided the Escrow Agent gives 10 days advance notice thereof to Lessee. Section 2.05. The Escrow Agent may execute this Agreement following shall only be responsible for the date hereofsafekeeping and investment of the moneys held in the Escrow Fund, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained disbursement thereof in accordance with this Agreement, (ii) any failure and shall not be responsible for the authenticity or accuracy of such certifications or documents, the application of amounts paid pursuant to such certifications by the Company persons or entities to perform or comply with any covenant contained in this Agreementwhich they are paid, or (iii) any action, suit or proceeding which is pending or threatened against the Company as sufficiency of the Effective Time. No Shareholder shall have any right moneys credited to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless make the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datepayments herein required.

Appears in 1 contract

Sources: Equipment Lease Purchase Agreement

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders each Company Stockholder will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to such stockholder’s pro rata portion of the Escrow Amount) , in accordance with the provisions of Section 1.8(b), without any act of any ShareholderCompany Stockholder. The Company Stockholders shall not be deemed to have received the cash portion of the Escrow Amount until such stockholders actually receive delivery of such cash from the Escrow Agent pursuant to the provisions of Section 7.2(c). Each holder of assumed Company Options shall contribute shares of Parent Common Stock to the Escrow Fund upon exercise of such assumed Company Options in accordance with the provisions of Section 1.8(b). To the extent that a holder of assumed Company Options does not fund fully his or her pro rata portion of the Escrow Amount during the Escrow Period, Parent shall have the right to recover Losses that were not paid in full from the Escrow Amount from such holder after the termination of the Escrow Amount as such holder exercises the assumed Company Options; provided however, that Parent’s right of recovery described in this sentence shall not exceed what would have been such holder’s pro rata portion of the Escrow Amount if such holder had funded fully his or her portion of the Escrow Amount. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, Parent will be deposited deposit the Escrow Amount with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association N.A. (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(i) as Escrow Agent below)) (the “Escrow Agent”), the deposit of the cash portion of such deposit Escrow Amount to constitute an a cash escrow fund (the “Cash Escrow Fund”) and the deposit of the Parent Common Stock portion of such Escrow Amount to constitute a stock escrow fund (the “Stock Escrow Fund), (the Cash Escrow Fund and Stock Escrow Fund shall together constitute the “Escrow Fund”) to be governed by the terms set forth hereinherein and at Parent’s cost and expense. Parent will make additional contributions to the Stock Escrow Fund as holders of assumed Company Options exercise such options. The Cash Escrow Fund and Stock Escrow Fund shall be maintained separately by the Escrow Agent. Parent and Company hereby agree that the Cash Escrow Fund shall be treated as an installment obligation for purposes of Code section 453 and neither party shall take any action or filing position inconsistent with such characterization. The Escrow Amount shall be available to compensate any Parent Indemnified Party for any claims by such parties for any Losses suffered or incurred by them and for which they are entitled to recovery under this Article VII. Parent and the Company each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the Total Transaction Value. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Closing, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Cypress Semiconductor Corp /De/)

Escrow Fund. As security MERGER CONSIDERATION; CONVERSION OF COMPANY COMMON SHARES AND COMPANY PREFERRED SHARES. (a) On or prior to the Closing Date (i) Parent, the Company and the Stockholders' Representative (as defined below) shall enter into an Escrow Agreement substantially in the form attached hereto as Exhibit G (the "Escrow Agreement") with State Street Bank and Trust Company, as escrow agent (the "Escrow Agent"). At the Closing, portions of the Parent Preferred Shares and Aggregate Merger Cash Consideration ( as defined below in Section 1.6(b)) as specified in the Escrow Agreement shall be deposited by Parent in an escrow fund (the "Escrow Fund") to the Escrow Agent which shall be held by the Escrow Agent in such capacity. Such Parent Preferred Shares held in the Escrow Fund shall be beneficially owned by the holders on whose behalf such shares were deposited in the Escrow Fund and shall be available to compensate Parent as provided in Article VIII and in the Escrow Agreement. (b) The aggregate amount of cash and securities to be paid to the stockholders of the Company (each, a "Company Stockholder" and collectively, the "Company Stockholders") upon the conversion of, and as consideration for, all of the issued and outstanding Company Shares at the Effective Time shall equal $18,000,000 (the "Aggregate Merger Consideration"). The Aggregate Merger Consideration shall be comprised of 4,000,000 shares of Parent Preferred Stock having the rights, preferences and terms set forth in that certain private placement offering (the "Offering") of Parent pursuant to Parent's Confidential Private Placement Memorandum dated as of May 5, 1999, as amended and supplemented to date (the "Private Placement Memorandum") ( a copy of which will be delivered to each such Company Stockholder prior to the Effective Time) and in Section 1.6 of the Parent Disclosure Schedule. Each Company Stockholder shall be entitled to that portion of the aggregate Merger Stock Consideration (as defined in Section 1.6(c)(i)) as determined in accordance with the rights and preferences of each class and series of capital stock of the Company as set forth in the Company's Certificate of Incorporation and described in Section 1.6(b) of the Parent Disclosure Schedule. Notwithstanding the foregoing, if Parent determines that Regulation D promulgated under the Securities Act of 1933, as amended (the "Securities Act"), does not permit it to issue shares of Parent Preferred Stock to any Company Stockholder which is not an "accredited investor" as such term is defined in the Securities Act, such Company Stockholder (an "Unaccredited Company Stockholder") shall be issued, at Parent's discretion, cash in the amount of $4.50 for each share of Parent Preferred Stock to which the indemnity provided for Unaccredited Company Stockholder would have been entitled in lieu of shares of such Parent Preferred Stock (the "Merger Cash Consideration", the aggregate Merger Cash Consideration paid to all of the Unaccredited Company Stockholders, hereinafter referred to as the "Aggregate Merger Cash Consideration"). (c) At the Effective Time, by virtue of the Merger and without any action on the part of the parties hereto or the holders of the following securities: (i) Subject to the other provisions of this Article 8 I, each Company Share issued and outstanding immediately prior to the Effective Time (other than any Company Shares to be canceled pursuant to Section 1.7 and any Dissenting Shares (as defined in Section 1.17)) shall be converted automatically into the right to receive (i) the Exchange Ratio Fraction of a fully paid and nonassessable share of Parent Preferred Stock, together with cash, if any, in lieu of any fraction of a share of Parent Preferred Stock, pursuant to Section 1.11 (collectively, the "Merger Stock Consideration"), less such Company Stockholder's share of the Escrow Fund, and (ii) if such Company Share is held by virtue an Unaccredited Company Shareholder, such stockholder's portion of the Aggregate Merger Cash Consideration. (ii) For purposes of this Agreement, the Shareholders will be deemed "Exchange Ratio Fraction" shall mean the quotient (calculated to have received and deposited with the Escrow Agent nearest five (as defined below5) decimal places) obtained by dividing (x) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after result obtained from subtracting the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date.▇▇▇▇

Appears in 1 contract

Sources: Merger Agreement (Orchid Biosciences Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, ----------- Acquiror shall deposit with the Escrow AmountAgent: 41,554.8373 shares of Acquiror Common Stock registered in the name of Escrow Agent, without any act which is equal to fifteen percent (15%) of any Shareholderthe shares of Acquiror Common Stock that each Target Stockholder is entitled to receive in the Merger, pursuant to Section 1.6(a) of the Merger Agreement (the "Initial Escrow Shares"). In addition, from time to --------------------- time thereafter, Acquiror shall deposit with Escrow Agent additional shares of Acquiror Common Stock or other equity securities issued or distributed by Acquiror (including shares issued upon a stock split) in respect of the Initial Escrow Shares (the "New Shares" and, together with the Initial Escrow Shares, ---------- the "Escrow Shares") subject to and in accordance with Section 6.6 of the Merger ------------- Agreement. When and if cash dividends on Escrow Shares in the Escrow Fund (the "Escrow Cash") shall be declared and paid, they shall be retained in escrow ----------- pending final distribution of the Escrow Fund and will not be immediately distributed to the beneficial owners of the Escrow Shares. Such dividends will become part of the Escrow Fund and will be deposited with J.▇available to satisfy Damages. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and The beneficial owners of the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), Shares shall pay any taxes on such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth hereindividends. The Escrow Agent may execute this Agreement following the date hereof, Shares and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount Cash are referred to herein as the "Escrow ------ Fund." Exhibit A hereto sets forth the name of each Target Stockholder and the ---- --------- number of Escrow Shares contributed to the Escrow Fund on behalf of each Shareholder shall be as provided under such Target Stockholder pursuant to Section 2.046.2 of the Merger Agreement. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty value of the Company contained Escrow Shares, as determined in this Agreementaccordance with Section 4(c)(iii) below, (ii) any failure contributed by each Target Stockholder divided by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as aggregate value of the Effective Time. No Shareholder shall have any right Escrow Shares, as determined in accordance with Section 4(c)(iii) below, contributed by all Target Stockholders to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund shall be each such Target Stockholder's "proportionate interest" in respect the Escrow Shares. The Escrow ---------------------- Fund shall be held as a trust fund and shall not be subject to any lien, attachment, trustee process or any other judicial process of any Loss subject to indemnification pursuant to this Article 8 unless the amount creditor of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered party hereto. Escrow Agent agrees to accept delivery of the Escrow Agent as provided Fund and to hold such Escrow Fund in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not escrow subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; terms and provided, further, that any claim resulting from the inaccuracy or breach conditions of this Agreement and Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary 6 of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateMerger Agreement.

Appears in 1 contract

Sources: Merger Agreement (Netcentives Inc)

Escrow Fund. As security for On the indemnity provided for in this Article 8 and by virtue Closing Date, a portion of this Agreement, the Shareholders will be deemed Parent Stock to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may ----------- be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act Stockholders and a portion of any Shareholder. As soon as practicable after the Effective Time, Cash Consideration to be paid to the Escrow AmountLimited Partners at the Closing shall, without any act of any ShareholderLimited Partner, will be registered in the name of, and be deposited with J.▇. ▇▇▇▇▇▇ Trust Companywith, National Association ChaseMellon Shareholder Services LLC (or other institution acceptable to Parent and the Shareholder Representativeselected by Purchaser) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit to constitute an the escrow fund (the ------------ "Escrow Fund") and to be governed by the terms set forth hereinherein and in the ----------- Escrow Agreement attached hereto as Exhibit E (the "Escrow Agreement"). The Escrow Agent may execute this Agreement following On the date hereof--------- ---------------- Closing Date, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as $382,500 of the date hereof between Cash Consideration otherwise payable to the other signatories hereto. The portion Limited Partners (the "Initial Escrow Cash" and, together with the Supplemental ------------------- Cash and the New Cash (each as defined below), the "Escrow Cash") and 75,000 ----------- shares of Parent Stock that the Stockholders are entitled to receive in the Purchase in exchange for the GP Shares (the "Initial Escrow Shares" and, --------------------- together with the New Shares (as defined below), the "Escrow Shares") shall be ------------- deposited by Purchaser into the Escrow Amount contributed on behalf of each Shareholder shall be Fund. In the event that any Damages (as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officersdefined below) arise, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund shall be available to compensate the Indemnified Persons (defined below) pursuant to the indemnification obligations of the Limited Partnership, the General Partner and the Stockholders pursuant to Section 8.3 and in respect of any Loss accordance with the Escrow Agreement, subject to indemnification pursuant the limitations of Section 8.3(b) below. At Closing, the Sellers' Agent may direct that a portion -42- of the Partnership Cash Distribution not to this Article 8 unless exceed $50,000 (the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses"Supplemental Cash") be deposited in the Sub-Account Fund (as defined in the ----------------- Escrow Agreement), which in Supplemental Cash shall be available to the aggregate exceed $1,000,000 Sellers' Agent (with notice to Purchaser) during the “Basket Amount”)Escrow Period to pay any accrued legal, have been delivered accounting or other administrative expenses incurred by the Sellers' Agent during the Escrow Period. Resort to the Escrow Agent as provided in paragraph (e) below in which case Parent Fund shall be entitled to recover all Losses including made proportionately between the Basket Amount; providedEscrow Cash and the Escrow Shares on a 45%-55% basis, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Daterespectively.

Appears in 1 contract

Sources: Limited Partnership Interest and Stock Purchase Agreement (Data Critical Corp)

Escrow Fund. As security for the indemnity provided for in this Article 8 Section 7.2 hereof and by virtue of this Agreement, the Company Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any Company Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Company Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ U.S. Bank Trust Company, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeCompany Shareholders) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Effective Time, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Company Shareholder shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). The Company Shareholders shall jointly agree to indemnify and hold Parent and its officers, directors and affiliates (the "Indemnified Parties") harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, or (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement; provided, or (iii) any actionhowever, suit or proceeding that, except as set forth in Section 7.4, the aggregate amount for which is pending or threatened against the Company as of Shareholders are required to indemnify the Effective TimeIndemnified Parties shall not exceed the amount deposited in the Escrow Fund. No Shareholder The Escrow Fund shall be available to compensate Parent and its affiliates for any such Losses. The Company Shareholders shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent after the Effective Time. Notwithstanding anything in Nothing herein shall limit the preceding language to liability of the contraryCompany and the Principal Shareholder for any breach of any representation, warranty or covenant if the Merger does not close for reasons other than Parent's breach of its obligations hereunder. Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Officer's Certificate identifying Losses, which (as defined in the aggregate exceed $1,000,000 paragraph (the “Basket Amount”), d) below) identify Losses have been delivered to the Escrow Agent as provided in paragraph (ed) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datebelow.

Appears in 1 contract

Sources: Merger Agreement (Tut Systems Inc)

Escrow Fund. As security (a) In accordance with the Merger Agreement, the Company agrees to place under the control of the Escrow Agent, concurrently with the execution of this Agreement, an aggregate number of shares of Company Common Stock equal to the Parent Share Consideration Escrow Amount and to deposit, in certain circumstances as set forth in the Merger Agreement, the Listing Fee Escrow Amount by book entry transfer or another appropriate method determined by the Company and acceptable to Seller and Escrow Agent. The parties hereto acknowledge that (i) the Escrow Agent shall not hold in the escrow account, either physically or electronically (other than pursuant to the following clause (ii)), any Company Common Stock and (ii) a deposit of the Escrow Share Deposit shall be deemed to have occurred when the transfer agent for the indemnity provided Company Common Stock, acting at the Company's direction, identifies, on its books and records, the Escrow Agent as the holder of the Company Common Stock (for in this Article 8 and by virtue the avoidance of doubt, as of the date of this Agreement, the Shareholders will “transfer agent” shall be DST Systems, Inc. (contact information for whom is set forth on Annex B to this Agreement)). (b) Annex A to this Agreement sets forth the Seller's and the Bonus Executives' respective entitlements to the Escrow Share Deposit as of the date hereof. Seller and the Company shall amend Annex A from time to time to accurately reflect the Seller's and the Bonus Executives' entitlements to the Escrow Share Deposit pursuant to this Agreement and the Merger Agreement (including Section 1.4 of the Company Disclosure Letter delivered pursuant to the Merger Agreement). If, at any time on or after the date of this Agreement, but on or prior to April 5, 2014, any of the Bonus Executives voluntarily resigns his employment from the Company without “good reason” (as such term is defined in the employment agreement between the Company and such Bonus Executive), such resigning Bonus Executive shall be deemed to have received forfeited all of his/her entitlement to any remaining shares of Company Common Stock comprising the Escrow Share Deposit, and deposited the Seller and the Company shall amend Annex A to allocate such forfeited entitlement to the Seller and, if applicable, the Bonus Executives, with such allocation to be pursuant to the terms of Section 1.4 of the Company Disclosure Letter delivered pursuant to the Merger Agreement. (c) Notwithstanding anything to the contrary herein, Escrow Agent shall distribute any dividends paid on the shares comprising the Escrow Share Deposit to Seller and the Bonus Executives, as applicable, promptly upon receipt thereof, such dividends to be distributed to Seller and the Bonus Executives in proportion to their entitlements to the Escrow Share Deposit as set forth on Annex A to this Agreement. (d) For U.S. federal and other income Tax purposes, Company shall be treated as the owner of the Escrow Share Deposit and any other property in the Escrow Fund, except that any shares of Company Common Stock constituting the Escrow Share Deposit in respect of which a valid election under Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”), has been made shall be treated as owned by the Seller or the relevant Bonus Executive, as applicable, making such election, provided that the Seller or such Bonus Executive shall have delivered notice to the Escrow Agent (as defined below) of the making of such election. All dividends or other income earned in respect of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend Share Deposit or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent otherwise under this Agreement (the “Escrow AgentIncome”), to the extent earned in respect of Company Common Stock treated as owned by the Seller or a Bonus Executive, as applicable, pursuant to the preceding sentence shall be allocated to Seller or the applicable Bonus Executive as income earned from the Escrow Fund by Seller or such deposit Bonus Executives whether or not said income has been distributed during such year, and Escrow Agent shall report to constitute an escrow fund the IRS (on IRS Form 1099, 1042S or other applicable form) and any other taxing authority any Escrow Income in a manner consistent with such allocation, and shall otherwise comply with any information reporting requirements under applicable law. It is intended that any Escrow Income not allocated to the Seller or a Bonus Executive pursuant to the preceding sentence shall be reported by the Company as amounts paid to the Seller or the applicable Bonus Executive for services. Escrow Fund”) Agent shall withhold any taxes required to be governed withheld by applicable tax law (other than wage withholding, which shall be performed by the terms set forth hereinCompany), and shall cooperate with the Company in order to remit such taxes to the appropriate authorities. To the extent the Company is required to withhold any taxes by reason of any portion of the Escrow Share Deposit being treated as wages paid to Seller or any Bonus Executive (including any election under Section 83(b) of the Code with respect thereto), the Company shall instruct the Escrow Agent to, and the Escrow Agent shall, release a number of shares of Company Common Stock to the Company that shall be equal to the product of (i) the applicable withholding rate (expressed as a percentage) for the Seller or Bonus Executive, as applicable, entitled to a portion of the Escrow Shares Deposit that will be treated as wages multiplied by (ii) the total number of Escrow Shares that will be treated as wages in respect of the Seller or such Bonus Executive, as applicable (in each of clauses (i) and (ii), as determined by the Company pursuant to its good faith calculation), and the Seller's or such Bonus Executive's, as applicable, entitlement to the Escrow Share Deposit shall be reduced by the number of such shares of Company Common Stock released to the Company. In connection with any matter upon which the stockholders of the Company have a right to vote, the Seller shall have the right to the exercise of voting rights pertaining to the Escrow Share Deposit, including, without limitation, the right to vote such shares. The shares of Company Common Stock comprising the Escrow Share Deposit shall participate on the same basis as other shares of Company Common Stock in any split, combination, reclassification, liquidation, merger, stock exchange or other transaction affecting the Company Common Stock. The Seller shall be entitled to receive all proxy voting materials for the Escrow Share Deposit. The Escrow Agent may execute this Agreement following shall notify the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature Seller of this Agreement as all voting rights or discretionary actions or of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall or dates by when such rights must be as exercised or such action must be taken provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the that Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; providedhas received, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, the transfer agent or any Subsidiary the relevant depository, timely notice of such rights or discretionary corporate action or of the Company in respect date or dates such rights must be exercised or such action must be taken. Absent actual receipt of any taxable year such notice, Escrow Agent shall have no liability for failing to so notify the Seller. In order for Escrow Agent to act, it must receive the Seller's written directions at Escrow Agent's offices, addressed as Escrow Agent may from time to time request, not later than noon at least two (or portion thereof2) ending on or business days prior to the Expiration Datelast scheduled date to act with respect to such securities (or such earlier date or time as Escrow Agent may notify the Seller). Absent Escrow Agent's timely receipt of such written direction, Escrow Agent shall not be liable for failure to take any action relating to or to exercise any rights conferred by such Company Common Stock. The Escrow Agent shall not vote any of the shares of Company Common Stock constituting the Escrow Share Deposit.

Appears in 1 contract

Sources: Indemnification Escrow Agreement (Cole Credit Property Trust III, Inc.)

Escrow Fund. As security for (i) At the indemnity provided for in this Article 8 and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeClosing, the Escrow AmountShares shall be registered in the name of, without any act of any Shareholder, will and be deposited with J.▇. ▇▇▇▇▇▇ with, U.S. Bank Trust Company, National Association (or other institution acceptable to selected by Parent and with the Shareholder Representativereasonable consent of the Company) as Escrow Agent escrow agent (the "Escrow Agent"), such deposit and any Additional Escrow Shares to constitute an escrow fund (the Escrow Fund”) Fund and to be governed by the terms set forth herein. herein and in the Escrow Agreement attached hereto as Exhibit G. The Escrow Agent may execute this Agreement following Fund shall be available to compensate Parent pursuant to the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as indemnification obligations of the date hereof between Stockholders. In the other signatories hereto. The portion event Parent issues any Additional Escrow Shares, such shares will be issued in the name of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify Agent and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent in the same manner as provided the Escrow Shares delivered at the Closing. (ii) Except for dividends paid in paragraph stock declared with respect to the Escrow Shares (e) below in "Additional Escrow Shares"), which case Parent shall be entitled treated as Escrow Shares pursuant to recover this Section 7.2 and all Losses including references in this Section 7.2 to the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof term "Escrow Shares" shall be recoverable from deemed to include any Additional Escrow Shares, any cash dividends, dividends payable in securities or other distributions of any kind made in respect of the first dollar and not subject Escrow Shares will be delivered to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary Stockholders of the Company on a pro rata basis based upon their respective interests in the Escrow Fund at the time of distribution (in each case, such Stockholder's "Pro Rata Share"). Each Stockholder of the Company will have voting rights with respect to such stockholder's Pro Rata Share of any taxable year (or portion thereof) ending on or prior the Escrow Shares deposited in the Escrow Fund so long as such Escrow Shares are held in escrow, and Parent will take all reasonable steps necessary to allow the Expiration Dateexercise of such rights. While the Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement, each Stockholder of the Company will retain and will be able to exercise all other incidents of ownership of such stockholder's Pro Rata Share of the Escrow Shares which are not inconsistent with the terms and conditions of this Agreement.

Appears in 1 contract

Sources: Merger Agreement (Protein Design Labs Inc/De)

Escrow Fund. As security for the indemnity provided for in this Article 8 Section 7.2 and by virtue of this Agreement, the Shareholders Company Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.D.L. . ▇▇▇▇▇▇ Trust ▇▇▇row Company, National Association Inc. (or other institution acceptable to Parent and the Shareholder RepresentativeCompany Stockholders) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Effective Time, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Stockholder shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). The Shareholders shall Company and the Company Stockholders jointly agree to indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”"INDEMNIFIED PARTIES") harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, or (ii) any failure by the Company to perform or comply with any covenant contained in this AgreementAgreement or any failure by Jona▇▇▇▇ ▇▇▇▇▇ ▇▇ Wayn▇ ▇▇▇▇▇▇▇▇ ▇▇ comply with the provisions of Section 5.17 herein; provided, or however, that (iiiexcept for indemnification obligations due to any breach of the Extended Representations and Warranties for which there is no limitation) any action, suit or proceeding the aggregate amount for which is pending or threatened against the Company as and the Company Stockholders are required to indemnify the Indemnified Parties shall not exceed the amount held by the Escrow Agent in the Escrow Fund; and provided, further, that (except for indemnification obligations due to any breach of the Effective TimeExtended Representations and Warranties) the sole recourse of the Indemnified Parties for indemnification obligations of the Company and the Company Stockholders shall be to make claims upon the Escrow Fund pursuant to Section 7.2(d) hereof. No Shareholder The Escrow Fund shall be available to compensate Parent and its affiliates for any such Losses. The Company Stockholders shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent after the Effective Time. Notwithstanding anything in Nothing herein shall limit the preceding language to liability of the contraryCompany for any breach of any representation, warranty or covenant if the Merger does not close for reasons other than Parent's breach of its obligations hereunder; but the Company Stockholders shall not be personally liable therefor. Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Officer's Certificate (as defined in paragraph (d) below) identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have Losses has been delivered to the Escrow Agent as provided in paragraph (ed) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datebelow.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Cybergold Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue Effective Time, each stockholder of this Agreementthe Company (individually, a "Company Stockholder" and, collectively, the Shareholders "Company Stockholders") will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend dividend, or recapitalization effected by Parent after the Effective Time with respect to shares constituting the Escrow Amount) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyChaseMellon Shareholder Services LLC, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 8.2(g) below)) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Stockholder shall be in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 1.6(b) and shall be in the respective amounts listed opposite each Company Stockholder's name listed in EXHIBIT K attached hereto. Except as provided under in Section 2.041.6(d)(iv) any shares of Parent Common Stock contributed to the Escrow Fund shall not be unvested or subject to any right of repurchase, risk of forfeiture or other condition in favor of the Surviving Corporation. The Shareholders Escrow Fund shall indemnify and hold be available to compensate the Parent and its officers, directors and affiliates (including the “Indemnified Parties”Surviving Corporation) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ attorneys= fees and expenses and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) defense incurred by Parent, its officers, directors, directors or affiliates (including the Surviving Corporation) (i) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company or of any Affiliate Stockholder contained herein, or in any certificate, instrument, schedule or document delivered by the Company or any Affiliate Stockholder at the Closing in connection with this AgreementAgreement or the Merger, (ii) or any failure by the Company or any Affiliate Stockholder prior to the Closing to perform or comply with any covenant contained herein or (ii) in the event the Company prior to the Closing, or the Securityholder Agent after the Closing, agrees to any cash settlement with the Distributor for the purposes of terminating the exclusivity provisions of the Distribution Agreement as provided in Section 6.16 above (hereinafter individually a ALOSS@ and collectively "LOSSES"), provided that claims arising out of an inaccuracy or breach of any representations and warranties and any covenant of the Company or the Affiliate Stockholders contained in this AgreementAgreement and in any certificate, instrument, schedule or (iii) any action, suit or proceeding which is pending or threatened against document delivered by the Company as or the Affiliate Stockholders at the Closing in connection with this Agreement or the Merger must be asserted on or before 5:00 p.m. (California Time) on the date that is one year following the Closing Date and provided further, that a Loss for purposes of clause (ii) above shall be deemed to include only the amount of such cash settlement, exclusive of any expenses or costs incurred in attorneys' fees or other expenses or costs incidental to such cash settlement. No portion of the Effective TimeEscrow Amount shall be contributed in respect of any Company Options. No Shareholder Except as provided in Section 11.2 relating to Third Party Expenses (as defined therein) exceeding $150,000, which excess shall have any right to contribution be payable from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contraryEscrow Fund, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer=s Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 75,000 (the “Basket Amount”of which no individual Loss shall be less than $5,000), have been delivered to the Escrow Agent as provided in paragraph (ed) below and either there is no objection thereto or any objection has been resolved in which case accordance with the provisions of this Article VIII; in such case, Parent shall be entitled to may recover from the Escrow Fund all Losses (including any Losses within the Basket Amount; provided, however, $75,000 threshold and any individual Losses that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall may be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, less than $5,000) for which there is no objection or any Subsidiary objection had been resolved in accordance with the provisions of this Article VIII in accordance with the Company in respect provisions of any taxable year (or portion thereof) ending on or prior to the Expiration Datethis Section 8.2.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Peregrine Systems Inc)

Escrow Fund. As security for Notwithstanding anything to the indemnity provided for contrary in the other provisions of this Article 8 1, Acquirer shall withhold from the gross cash consideration otherwise payable to each Indemnifying Party (which, in the case of a Company Shareholder that is a holder of Unvested Company Shares, shall be funded solely by the portion of the closing consideration for such Company Shareholder that is vested immediately prior to Closing) in accordance with Section 1.1(a), such Indemnifying Party’s Pro Rata Share of the Adjustment Escrow Amount and by virtue of this Agreementthe Indemnity Escrow Amount. At the Closing, Acquirer shall initiate a wire to be deposited (or cause to be deposited) the Shareholders will be deemed to have received Adjustment Escrow Amount and deposited the Indemnity Escrow Amount with the Escrow Agent (Agent, as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect escrow agent pursuant to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective TimeAgreement, to be held by the Escrow Amount, without any act Agent in accordance with and subject to the provisions of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent this Agreement and the Shareholder Representative) as Escrow Agent Agreement. The Adjustment Escrow Amount plus any interest or earning paid thereon in accordance with the Escrow Agreement (the “Adjustment Escrow AgentFund)) shall be available to compensate Parent for any Aggregate Consideration Shortfall under Section 1.6, such deposit to constitute an escrow fund and shall be held and distributed in accordance with Section 1.6 and the Escrow Agreement. The Indemnity Escrow Amount plus any interest or earnings paid thereon in accordance with the Escrow Agreement (the “Indemnity Escrow Fund” and, together with the Adjustment Escrow Fund, the “Escrow Fund”). Subject to Section 9.2, the Indemnity Escrow Fund shall constitute partial security for the benefit of Acquirer (on behalf of itself or any other Indemnified Person) with respect to any Indemnifiable Damages pursuant to the indemnification obligations of the Indemnifying Parties under Article 9, and shall be governed by held and distributed in accordance with Section 9.1 and the terms set forth hereinEscrow Agreement. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature adoption of this Agreement as and the approval of the date hereof between Share Purchase by the Company Shareholders shall constitute, among other signatories heretothings, approval of the Adjustment Escrow Amount and the Indemnity Escrow Amount, the withholding of the Adjustment Escrow Amount and the Indemnity Escrow Amount by Acquirer and the appointment of the Shareholders’ Agent. The portion Parent shall be treated as the owner of the Escrow Amount contributed on behalf of each Shareholder Fund and for Tax purposes, shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against report all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amountincome earned thereon; provided, however, that any Loss resulting within 30 days of the end of each calendar year, Parent shall be entitled to receive from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject Escrow Fund a Tax distribution equal to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary 25% of the Company in respect amount of any taxable year (or portion thereof) ending income earned on or prior to the Expiration DateEscrow Fund for such year.

Appears in 1 contract

Sources: Share Purchase Agreement (Proofpoint Inc)

Escrow Fund. As security for (a) At the indemnity provided for in this Article 8 and by virtue of this AgreementClosing, Purchaser shall withhold the Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Adjustment Escrow Amount, without any act of any Shareholderthe Indemnity Escrow Amount, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Companythe Tax Escrow Amount, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeSpecial Escrow Amount from the Upfront Stock Consideration issuable pursuant to Section 1.1(a) as Escrow Agent (the aggregate amount of shares of Purchaser Common Stock so held by Purchaser from time to time, the Adjustment Escrow Agent”)Fund,” the “Indemnity Escrow Fund,” the “Tax Escrow Fund,” and the “Special Escrow Fund” respectively, such deposit to constitute an escrow fund (and together, the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and deposit such later execution, if so executed after the date hereof, shall not affect the binding nature shares of this Agreement as of the date hereof between the other signatories hereto. The portion of Purchaser Common Stock in the Escrow Amount contributed Account in accordance with Article I. The Adjustment Escrow Fund shall be available to compensate Purchaser (on behalf of each Shareholder itself or any other Indemnified Person) for any Upfront Consideration Shortfall determined pursuant to Section 1.6. The Indemnity Escrow Fund shall be as provided under available to compensate Purchaser (on behalf of itself or any other Indemnified Person) for any Upfront Consideration Shortfall determined pursuant to Section 2.041.6 and Indemnifiable Damages pursuant to this Article IX. The Shareholders Tax Escrow Fund shall indemnify be available to compensate Purchaser (on behalf of itself or any other Indemnified Person) for any Indemnifiable Damages arising out of, resulting from or in connection with Section 9.2(a)(iv) for the Tax Matter. The Special Escrow Fund shall be available to compensate Purchaser (on behalf of itself or any other Indemnified Person) for any Indemnifiable Damages arising out of, resulting from or in connection with the Specified Matters. (b) Distributions from the Escrow Account of the Indemnity Escrow Fund, the Tax Escrow Fund, and hold Parent and its officersthe Special Escrow Fund shall only be made pursuant to, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementSection 9.4(c), (ii) any failure by the Company to perform or comply with any covenant contained in this AgreementSection 9.3(e)(i), or (iii) any actiona joint agreement executed by each of Purchaser and the Seller Agent or (iv) a final, suit non- appealable award or proceeding which is pending or threatened against order of a court of competent jurisdiction in compliance with Section 10.11, and otherwise in accordance with the Company as terms of the Effective TimeEscrow Agreement. No Shareholder shall have any right to contribution All amounts released from the Company for Indemnity Escrow Fund, the Tax Escrow Fund, and the Special Escrow Fund to the Sellers shall be made in accordance with such Seller’s Escrow Pro Rata Share at the time of such release. (c) Promptly (and in any claim made by Parent event within 10 Business Days) after the Effective Time. Notwithstanding anything in end of the preceding language to Indemnity Escrow Period, Purchaser and the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered Seller Agent shall provide a joint written instruction to the Escrow Agent as provided to distribute to each Seller such Seller’s Escrow Pro Rata Share of the Indemnity Escrow Fund, less that portion of the Indemnity Escrow Fund that is determined, in paragraph (e) below the reasonable judgment of Purchaser, to be necessary to satisfy all unsatisfied or unresolved claims for indemnification specified in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject Officer’s Certificate delivered to the Basket Amount nor shall it be included Seller Agent in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending good faith on or prior to the Expiration Dateend of the Indemnity Escrow Period in accordance with this Article IX, which portion shall remain in the Indemnity Escrow Fund until such claims for Indemnifiable Damages have been resolved or satisfied. At any time following the end of the Indemnity Escrow Period, the Tax Escrow Period or the Special Escrow Period, as applicable, to the extent the number of shares of Purchaser Common Stock held in the Indemnity Escrow Fund, Tax Escrow Fund or the Special Escrow Fund, as applicable, exceeds the number of shares that is determined, in the reasonable judgment of Purchaser and the Seller Agent, to be necessary to satisfy all unsatisfied or unresolved claims for indemnification specified in any Officer’s Certificate delivered to the Seller Agent on or prior to the end of the Indemnity Escrow Period, the Tax Escrow Period or the Special Escrow Period, as applicable, in accordance with this Section 9.4, based on the Purchaser Stock Price, Purchaser and the Seller Agent shall provide a joint written instruction to the Escrow Agent to promptly distribute the excess shares of Purchaser Common Stock to the Sellers in accordance with such Seller’s Escrow Pro Rata Share. Promptly (and in any event within 10 Business Days) after the end of the period of time beginning on the Closing Date and ending on the date that is 48 months following the Closing Date (or, as the case may be, such earlier date that (i) any Tax Matter has been finally resolved or the applicable statutes of limitation have expired and (ii) Indemnifiable Damages arising out of, resulting from or in connection with such Tax Matters have been recovered by the Indemnified Person(s)) (the “Tax Escrow Period”), Purchaser and the Seller Agent shall provide a joint written instruction to the Escrow Agent to distribute to each Seller such Seller’s Escrow Pro Rata Share of the Tax Escrow Fund, less that portion of the Tax Escrow Fund that is determined, in the reasonable judgment of Purchaser, to be necessary to satisfy all unsatisfied or unresolved claims for indemnification specified in any Officer’s Certificate delivered to the Seller Agent in good faith on or prior to the end of such period in accordance with this Article IX, which portion shall remain in the Tax Escrow Fund until such claims for Indemnifiable Damages have been resolved or satisfied. Promptly (and in any event within 10 Business Days) after the end of the period of time beginning on the Closing Date and ending on the date that is 24 months following the Closing Date (or, if earlier, the date on which all Specified Matters have been finally resolved) (the “Special Escrow Period”), Purchaser and the Seller Agent shall provide a joint written instruction to the Escrow Agent to distribute to each Seller such Seller’s Escrow Pro Rata Share of the Special Escrow Fund, less that portion of the Special Escrow Fund that is determined, in the reasonable judgment of Purchaser, to be necessary to satisfy all unsatisfied or unresolved claims for indemnification specified in any Officer’s Certificate delivered to the Seller Agent in good faith on or prior to the end of such period in accordance with this Article IX, which portion shall remain in the Special Escrow Fund until such claims for Indemnifiable Damages have been resolved or satisfied.

Appears in 1 contract

Sources: Stock Purchase Agreement (Soundhound Ai, Inc.)

Escrow Fund. As security for (a) The interest and proceeds earned on the indemnity provided for in this Article 8 Escrow Fund are called the “Escrow Income.” Escrow Income shall accrue to and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited with be part of the Escrow Fund. (b) The Escrow Fund shall be paid by the Escrow Agent as follows: (as defined belowi) the Escrow Amount (plus any additional shares as may be issued from time to time, to Buyer upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act joint instructions of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Companyand Perceptive, National Association for claims by Buyer Indemnified Persons for indemnification under Article VII (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the each claim, an Escrow AgentIndemnification Claim”), such deposit to constitute an escrow fund ; (the “Escrow Fund”ii) to be governed by Perceptive, on the terms set forth herein. The Release Date and on any other date in which any remaining balance of the Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed Fund is released after the date hereofRelease Date (whether partially or entirely), shall not affect an amount equal to 40% of the binding nature of this Agreement Escrow Income accrued as of the date hereof between the other signatories hereto. The portion of any such release of the Escrow Amount contributed Fund; (iii) on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates the date that is 12 months after the Closing Date (the “Indemnified PartiesRelease Date), to Perceptive, an amount, if greater than zero, equal to any remaining balance of the Escrow Fund minus the amount of any Indemnification Claim that has been asserted by Buyer but not satisfied; and (iv) harmless against all claimsfrom time to time after the Release Date, losses, liabilities, damages, deficiencies, costs to Buyer or Perceptive as any Indemnification Claims that were unsatisfied on the Release Date are resolved. (c) Perceptive and expenses, including reasonable attorneys’ Buyer shall each pay at the Closing 50% of the initial fees and expenses of investigation (hereinafter individually a “Loss” the Escrow Agent and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result Perceptive and Buyer shall each pay 50% of (i) any inaccuracy or breach of a representation or warranty additional fees and expenses of the Company contained in this Agreement, Escrow Agent. (iid) The Escrow Income that constitutes taxable income for United States federal income and other Tax purposes and any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from losses on the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled allocated to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DatePerceptive.

Appears in 1 contract

Sources: Asset and Share Purchase Agreement (Trinity Biotech PLC)

Escrow Fund. As Except as contemplated by Section 11.1, ----------- as security and the sole and exclusive recourse for the indemnity provided for indemnities and breaches of any representations, warranties or covenants contained in this Article 8 and by virtue Agreement or of this Agreementrepresentations, warranties or covenants of Zanova in any of the Shareholders will be deemed to have received and deposited with the Escrow Agent (other Transaction Documents, as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will Shares shall be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association U.S. Stock Transfer Corporation (or such other institution acceptable to Parent and selected by Onvia with the Shareholder Representativereasonable consent of Zanova) as Escrow Agent depository agent (the “Escrow "Depository Agent"), such deposit to constitute an escrow fund the Escrow ---------------- Fund (the "Escrow Fund") and to be governed by the terms set forth hereinin this ----------- Article X and in the Depository Agreement. The Escrow Agent may execute this Agreement following Notwithstanding the date hereof, and such later execution, if so executed after foregoing or anything to the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contrary contained in this Agreement, (ii) the indemnification obligations of the Former Zanova Stockholders pursuant to this Article X or otherwise shall be limited to the Escrow Shares deposited and present in the Escrow Fund and Onvia shall not be entitled to pursue any failure by the Company to perform claims for indemnification under this Article X or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened otherwise against the Company as Former Zanova Stockholders directly or personally, and the sole recourse of the Effective Time. No Shareholder Onvia shall have any right be to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from make claims against the Escrow Fund in respect accordance with the terms of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket AmountDepository Agreement; provided, however, that any Loss resulting from in the inaccuracy or breach case of the matters specified in Section 2.03(c11.1(a), 4.05 (b) and (c) Onvia may bring claims against the Former Zanova Stockholders after the conclusion of the Escrow Period until the expiration of the period set forth in the applicable subsection; and provided further, however, that Onvia may not recover amounts that in the aggregate (when combined with amounts recovered during the Escrow Period) exceed the value of the Escrow Shares as determined in accordance with Section 10.6; and provided further, however, Onvia may bring claims against one or 6.20 hereof shall be recoverable from more Former Zanova Stockholders for breaches of representations, warrants or covenants made by such Former Zanova Stockholder in Transaction Documents or other agreements or documents contemplated by this Agreement or the first dollar and Transaction Documents (including, but not subject limited to, the Letter of Transmittal) executed by such Former Zanova Stockholder in its capacity as a stockholder without regard to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by ParentIndemnification Threshold, the Company, Indemnification Threshold or any Subsidiary the limitations or requirements of the Company in respect of any taxable year (this Article X or portion thereof) ending on or prior to the Expiration DateSection 11.1.

Appears in 1 contract

Sources: Merger Agreement (Onvia Com Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 There is hereby created and by virtue of this Agreement, the Shareholders will be deemed to have received and deposited established with the Escrow Agent (as defined below) a fund to be designated the Escrow Amount Fund. The Authority irrevocably authorizes and directs the Escrow Agent to make payments from the Escrow Fund to pay Costs of the Project, or to reimburse the Institution for any Cost of the Project paid by it, provided the conditions set forth in this Section are satisfied. (plus any additional shares a) The Authority agrees as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect a condition precedent to the Escrow Amount) without any act disbursement of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the “Escrow Fund”) to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf Fund to comply with the terms of this Bond Agreement and to cause to be furnished or to furnish the Escrow Agent with a Requisition Form signed by either an Authorized Institution Representative and an Authorized Authority Representative or two Authorized Institution Representatives stating with respect to each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of payment made: (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, requisition number; (ii) any failure the name and address of the Person to whom payment is to be made by the Company Escrow Agent or, if the payment is to perform or comply be made to the Institution for a reimbursable advance, the name, address and a copy of the invoice of the Person to whom such advance was made together with any covenant contained in this Agreement, or proof of payment by the Institution; (iii) any action, suit or proceeding the amount to be paid; (iv) that each obligation for which payment is pending or threatened sought is a Cost of the Project against the Company as Escrow Fund, is unpaid or unreimbursed, and has not been the basis of any previously paid requisition; (v) if such payment is a reimbursement to the Institution for costs or expenses incurred by reason of work performed or supervised by officers or employees of the Effective Time. No Shareholder shall have Institution or any of its affiliates, that the amount to be paid does not exceed the actual cost thereof to the Institution or any of its affiliates; and (vi) no written notice of any lien, right to contribution from lien or attachment upon, or other claim affecting the Company for right to receive payment of, any claim made of the moneys payable under such Requisition Form to any of the Persons named therein has been received, or if any of the foregoing has been received, it has been released or discharged or will be released or discharged upon payment of the Requisition Form. Each Requisition Form shall be accompanied by Parent after such invoices, bills or receipts as the Effective Time. Notwithstanding anything in the preceding language Escrow Agent may reasonably require. (b) The Authority further agrees that prior to the contrary, the Parent may not receive any distribution first disbursement from the Escrow Fund in respect of any Loss subject Fund, the Authority shall furnish the Escrow Agent or cause to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered be furnished to the Escrow Agent such documents as provided in paragraph the Escrow Agent may reasonably require, including, but not limited to, paid r unpaid invoices, bills, receipts, affidavits, certificates and opinions. (ec) below in which case Parent Upon the written request of the Authority, the Escrow Agent shall be entitled to recover all Losses including furnish the Basket Amount; provided, however, that any Loss resulting Authority with a record of the requisitions and disbursements from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateEscrow Fund.

Appears in 1 contract

Sources: Bond Agreement

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Street Shareholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent Street after the Effective Time with respect to the Escrow AmountTime) without any act of any Street Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Street Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association N.A., (or other institution acceptable to Parent Street and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Street Shareholder shall be in proportion to the aggregate Select Common Stock and/or Select Series H Preferred Stock, as provided the case may be, which such holder would otherwise be entitled under Section 2.041.6(b). The Shareholders Escrow Fund shall indemnify and hold Parent be available to compensate Select and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses and expenses of investigation and defense, net of any benefits or proceeds of insurance (hereinafter individually a "Loss" and collectively "Losses") incurred by ParentSelect, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company Street contained in this AgreementArticle 2 herein (as modified by Street Schedules), (ii) or any failure by the Company Street to perform or comply with any covenant contained in this Agreementherein. Select and Street each acknowledge that such Losses, or (iii) any actionif any, suit or proceeding which is pending or threatened against the Company as of would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger consideration. No Shareholder Nothing herein shall have any right to contribution from limit the Company liability of Street for any claim made by Parent after breach of any representation, warranty or covenant if the Effective TimeMerger does not close. Notwithstanding anything in the preceding language Resort to the contraryEscrow Fund shall be the exclusive contractual remedy of Select for any breach by Street of any representation or warranty if the Merger does close; provided, the Parent however, that nothing herein shall limit any remedy for fraud. Select may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)100,000, have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case Parent shall be entitled to such case, Select may recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach Escrow Fund the total of Section 2.03(c)its Losses, 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach excess of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date$100,000.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Homestore Com Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this Agreement, Effective Time the Shareholders Company's stockholders will be deemed to have received and deposited consented to the deposit with the Escrow Agent (as defined below) of the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) Time), without any act required on the part of any Shareholderstockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act required on the part of any Shareholderstockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution an escrow agent acceptable to Parent and the Shareholder RepresentativeStockholder Agent (as defined in Section 7.2(g)(i) below) as Escrow Agent (the “Escrow Agent”"ESCROW AGENT"), such deposit to constitute an escrow fund (the “Escrow Fund”"ESCROW FUND") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereof, herein and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories heretoat Parent's cost and expense. The portion of the Escrow Amount contributed on behalf of each Shareholder stockholder of the Company shall be as provided in proportion to the aggregate Parent Common Stock to which such holder would otherwise be entitled under Section 2.04Sections 1.6(a) and 1.6(b). The Shareholders Escrow Amount shall indemnify be contributed entirely out of the shares of Parent Common Stock issuable upon the Merger in respect of Capital Common Stock, and hold no portion of the Escrow Amount shall be contributed out of the shares of Parent Common Stock reserved for issuance in respect of Company Options. The Escrow Fund is available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defenses (hereinafter individually a “Loss” "LOSS" and collectively “Losses”"LOSSES") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this AgreementArticle II herein, (ii) or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against herein. Parent and the Company as of each acknowledge that such Losses, if any, would relate to unassented contingent liabilities existing at the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after , which if resolved at the Effective Time. Notwithstanding anything Time would have led to a reduction in the preceding language to the contrary, the aggregate Merger consideration. Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate Officer's Certificates (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”), 100,000 have been delivered to the Escrow Agent as provided in paragraph (e) below ); in which case such case, Parent shall be entitled to may recover all Losses from the Escrow Fund its Losses, including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Date$100,000.

Appears in 1 contract

Sources: Merger Agreement (New Era of Networks Inc)

Escrow Fund. As security for the indemnity provided for in this Article 8 Section 7.2 hereof and by virtue of this Agreement, the Shareholders Company Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ U.S. Bank Trust Company, National Association (or other institution acceptable to Parent and the Shareholder RepresentativeCompany Stockholders) as Escrow Agent (the "Escrow Agent"), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Effective Time, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Company Stockholder shall be as provided in proportion to the aggregate Parent Common Stock which such holder would otherwise be entitled under Section 2.041.6(a). The Shareholders shall Company Stockholders jointly agree to indemnify and hold Parent and its officers, directors and affiliates (the "Indemnified Parties") harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses of investigation (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, or (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement; provided, or (iii) any actionhowever, suit or proceeding that, except as set forth in Section 7.4, the aggregate amount for which is pending or threatened against the Company as of Stockholders are required to indemnify the Effective TimeIndemnified Parties shall not exceed the amount deposited in the Escrow Fund. No Shareholder The Escrow Fund shall be available to compensate Parent and its affiliates for any such Losses. The Company Stockholders shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent after the Effective Time. Notwithstanding anything in Nothing herein shall limit the preceding language to liability of the contraryCompany for any breach of any representation, warranty or covenant if the Merger does not close for reasons other than Parent's breach of its obligations hereunder. Parent may not receive any distribution shares from the Escrow Fund unless and until Officer's Certificates (as defined in respect paragraph (d) below) identify Losses, the aggregate of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or which exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”)70,000, have been delivered to the Escrow Agent as provided in paragraph (ed) below in which case Parent shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration Datebelow.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Tut Systems Inc)

Escrow Fund. As security for At the indemnity provided for in this Article 8 and by virtue of this AgreementEffective Time, the Shareholders Company Stockholders will be deemed to have received and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow AmountTime) without any act of any ShareholderCompany Stockholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any ShareholderCompany Stockholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyU.S. Bank Trust, National Association N.A. (or other institution acceptable to Parent and the Shareholder RepresentativeSecurityholder Agent (as defined in Section 7.2(g) below)), as Escrow Agent (the “Escrow Agent”), such deposit to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth hereinherein and at Parent's cost and expense. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder Fund shall be as provided under Section 2.04. The Shareholders shall indemnify and hold available to compensate Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all for any claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys' fees and expenses, and expenses of investigation and defense (hereinafter individually a "Loss" and collectively "Losses") incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement(as modified by the Company Schedules), (ii) or any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against herein. Parent and the Company as of each acknowledge that such Losses, if any, would relate to unresolved contingencies existing at the Effective Time, which if resolved at the Effective Time would have led to a reduction in the aggregate Merger Consideration. No Shareholder Nothing herein shall limit the liability of the Company for any breach of any representation, warranty or covenant if the Merger does not close. Other than as provided in Section 5.16, the Company stockholders shall not have any right to of contribution from the Company for with respect to any claim made Loss claimed by Parent or its affiliates after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution shares from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Escrow Claim Certificate (as defined in paragraph (d) below) identifying Losses, which in the aggregate amount of which exceed $1,000,000 (the “Basket Amount”)100,000, have been delivered to the Escrow Agent as provided in paragraph (e) below in which case Parent shall be entitled to recover all Losses including the Basket Amount); provided, howeverno claim for Losses with respect to a single breach or failure to comply or perform in an amount less than $15,000 shall be delivered by Parent to the Escrow Agent or otherwise claimed by Parent. Once the aggregate amount of Losses claimed by Parent against the Escrow as to which there are no unresolved objections under Section 7.2(e) exceeds $100,000, that any Loss resulting Parent may recover from the inaccuracy or breach Escrow Fund the total of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateLosses.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Cypress Semiconductor Corp /De/)

Escrow Fund. As security for (a) Prior to the indemnity provided for Initial Closing of each Fund, all proceeds received in this Article 8 and by virtue connection with the sale of this Agreement, the Shareholders will Units of such Fund shall be deemed to have received and deposited in escrow with the Escrow Agent (as defined below) in subscription escrow accounts for the Trust. Escrow Amount (plus any additional shares as may deposits in the subscription escrow accounts for the Trust shall be issued upon any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect moved and credited to the Escrow Amount) without any act of any Shareholder. As soon as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholder, will be deposited with J.▇. ▇▇▇▇▇▇ Trust Company, National Association (or other institution acceptable to Parent and the Shareholder Representative) as Escrow Agent (the “Escrow Agent”), such deposit to constitute an applicable Fund’s escrow fund (the each, an “Escrow Fund”) by the Escrow Agent as promptly as practicable but in no event more than three days after receipt by the Escrow Agent, provided that such funds have cleared and constitute good funs and the Managing Owner has provided written instructions as to the a s to the amount to move and the specific fund to move such funds into. At the time funds are received by the Escrow Agent from subscribers, the Managing Owner shall promptly provide or cause the selling agent to provide the Escrow Agent with the following information in writing (i) the full name and address of each of the subscriber(s), (ii) the Fund in which the subscriber invested, (iii) the amount of the investment and (iii) any additional information which the Escrow Agent may reasonably request. (b) The Managing Owner shall instruct subscribers and prospective subscribers to make checks for subscriptions payable to the order of the Escrow Agent or send wire transfers for subscriptions directly to the Escrow Agent in accordance with the instructions set forth on Schedule 2 attached hereto. Any checks received that are made payable or wires that are sent to a party other than the Escrow Agent shall be returned to the selling agent that submitted such check or made such wire transfer. (c) The Escrow Agent is hereby authorized to deposit each check in the respective Escrow Account. For any check returned unpaid to the Escrow Agent such unpaid amount shall be debited against the respective Escrow Account and shall be returned to the selling agent that submitted the check. In such cases, the Escrow Agent will promptly notify the Managing Owner of such returnGMS. (d) The Escrow Agent shall hold and account for separately each Escrow Fund, and subject to the terms and conditions hereof, shall invest and reinvest each Escrow Fund and the proceeds thereof in accordance with Section 3. (e) Prior to the occurrence of the Initial Closing with respect to a Fund, the Managing Owner is aware and understands that it is not entitled to invest or (a) During the term of this Escrow Agreement, each Escrow Fund which is a USD Fund shall be invested in a separate trust account with JPMorgan Chase Bank, N.A. and each Escrow Fund which is a CDN Fund will be invested in a Canadian Dollar interest bearing Deposit Account The Escrow Agent will provide compensation on balances on each Fund at a rate determined by the Escrow Agent from time to time. Written investment instructions from the Managing Owner for investments permitted under NASD Member Notice 87-61, if any, shall specify the type and identity of the investments to be governed by purchased and/or sold. The Escrow Agent is hereby authorized to execute such purchases and sales of investments for investments through the terms set forth facilities of its own trading or capital markets operations or those of any affiliated entity. The Escrow Agent or any of its affiliates may receive compensation with respect to any investment directed hereunder including without limitation charging an agency fee in connection with each transaction. The parties hereto recognize and agree that the Escrow Agent will not provide supervision, recommendations or advice relating to either the investment of moneys held in any Escrow Fund or the purchase, sale, retention or other disposition of any investment described herein. The Escrow Agent may execute this Agreement following the date hereof, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion of the Escrow Amount contributed on behalf of each Shareholder shall be as provided under Section 2.04. The Shareholders shall indemnify and hold Parent and its officers, directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly have any liability for any loss sustained as a result of (i) any inaccuracy investment in an investment made pursuant to the terms of this Escrow Agreement or breach as a result of a representation any liquidation of any investment prior to its maturity or warranty for the failure of the Company contained in this Agreement, (ii) any failure by the Company Managing Owner to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language to the contrary, the Parent may not receive any distribution from the Escrow Fund in respect of any Loss subject to indemnification pursuant to this Article 8 unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ Certificate identifying Losses, which in the aggregate exceed $1,000,000 (the “Basket Amount”), have been delivered to give the Escrow Agent as provided instructions to invest or reinvest any Escrow Fund. The Escrow Agent shall have the right to liquidate any investments held in paragraph order to provide funds necessary to make required payments under this Agreement. The parties hereby acknowledge and confirm that funds deposited into the Brookshire US Dollar and Canadian Dollar Deposit accounts will be held uninvested. (eb) below in which case Parent Receipt, investment and reinvestment of Escrow deposits shall be entitled to recover all Losses including the Basket Amount; providedconfirmed by Escrow Agent as soon as practicable by account statement, however, that and any Loss resulting from the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof discrepancies in any such account statement shall be recoverable from noted by the first dollar Managing Owner and not subject the Trust to the Basket Amount nor shall it be included Escrow Agent within thirty (30) calendar days after receipt thereof. Failure to inform Escrow Agent in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary of the Company in respect writing of any taxable year discrepancies in any such account statement within said thirty (or portion thereof30) ending on or prior to the Expiration Dateday period shall conclusively be deemed confirmation of such account statement in its entirety.

Appears in 1 contract

Sources: Subscription Escrow Agreement

Escrow Fund. As security for the indemnity provided for in this Article 8 Section ----------- 7.2(a) above and by virtue of this AgreementAgreement and the Certificate of Merger, the Shareholders Company and the Escrow Stockholders will be deemed to have received (subject to the conditions of this Section 7.2) and deposited with the Escrow Agent (as defined below) the Escrow Amount (plus any additional shares as may be issued upon in respect of any stock split, stock dividend or recapitalization effected by Parent after the Effective Time with respect to the Escrow Amount) without any act of the Company or the Escrow Stockholders. The Escrow Amount shall be available to compensate the Indemnified Parties for any Shareholderclaims by such Parties for any Losses suffered or incurred by them and for which they are entitled to recovery under this Article VII. As soon promptly as practicable after the Effective Time, the Escrow Amount, without any act of any Shareholderthe Escrow Stockholders, will be deposited with J.▇. ▇▇▇▇▇▇ Trust CompanyImperial Bank, National Association as Escrow Agent (or other institution acceptable to Parent and the Shareholder RepresentativeStockholder Representative (as defined in Section 7.2(h) as Escrow Agent (below and the “Escrow Agent”preamble above)), such deposit of the Escrow Amount to constitute an escrow fund (the "Escrow Fund") to be governed by the terms set forth herein. The Escrow Agent may execute this Agreement following the date hereofhereof and prior to the Effective Time, and such later execution, if so executed after the date hereof, shall not affect the binding nature of this Agreement as of the date hereof between the other signatories hereto. The portion Notwithstanding any provision of this Agreement to the Escrow Amount contributed on behalf of each Shareholder shall be contrary (except as provided under set forth in Section 2.04. The Shareholders shall indemnify 5.5 and hold Parent and its officers7.2(m)), directors and affiliates (the “Indemnified Parties”) harmless against all claims, losses, liabilities, damages, deficiencies, costs and expenses, including reasonable attorneys’ fees and expenses of investigation (hereinafter individually a “Loss” and collectively “Losses”) incurred by Parent, its officers, directors, or affiliates (including the Surviving Corporation) directly or indirectly as a result of (i) any inaccuracy or breach of a representation or warranty of the Company contained in this Agreement, (ii) any failure by the Company to perform or comply with any covenant contained in this Agreement, or (iii) any action, suit or proceeding which is pending or threatened against the Company as of the Effective Time. No Shareholder shall have any right to contribution from the Company for any claim made by Parent after the Effective Time. Notwithstanding anything in the preceding language , no Indemnified Party shall be entitled to the contrary, the Parent may not receive indemnification or to obtain any distribution proceeds from the Escrow Fund in respect of or to otherwise recover any Loss subject to indemnification pursuant to this Article 8 amount unless the amount of any such Loss equals or exceeds $25,000 and until an Officers’ one or more Officer's Certificate (as defined in Section 7.2(e) below) identifying Losses, which Losses in excess of $100,000 in the aggregate exceed $1,000,000 (the "Basket Amount”), ") has or have been delivered to the Escrow Agent as provided in paragraph (eSection 7.2(e) below below, in which case Parent case, subject to subsections (f) and (g) of this Section 7.2, an Indemnified Party shall be entitled to recover all Losses including the Basket Amount; provided, however, that any Loss resulting from legal fees incurred by the inaccuracy or breach of Section 2.03(c), 4.05 or 6.20 hereof shall be recoverable from the first dollar and not subject to the Basket Amount nor shall it be included in calculating whether the Basket Amount has otherwise been exceeded; and provided, further, that any claim resulting from the inaccuracy or breach of Section 4.26 shall be reduced Stockholder Representative to the extent that such inaccuracy or breach actually reduces any Tax otherwise payable by Parent, the Company, or any Subsidiary set forth in Section 7.2(h)(ii) and indemnity claims of the stockholder Representative thereunder, as provided in Section 7.2(m), and any amounts required to be paid by the Parent or the Surviving Corporation holders of Company in Capital Stock with respect of any taxable year (or portion thereof) ending on or prior to the Expiration DateDissenting Shares, shall not be subject to such Basket Amount.

Appears in 1 contract

Sources: Agreement and Plan of Reorganization (Centillium Communications Inc)