Exhibit 2.11
ESCROW AGREEMENT
THIS ESCROW AGREEMENT, dated as of April 16, 2003, is by and among Med
Diversified, Inc., a Nevada corporation, and Trestle Corp., a Delaware
corporation (collectively, the "SELLERS"), Trestle Acquisition Corp., a Delaware
corporation (the "BUYER"), and Xxxxx Xxxxxx LLP (the "ESCROW AGENT").
W I T N E S S E T H
WHEREAS, Sellers and Buyer are parties to that certain Asset Purchase
Agreement (the "AGREEMENT"), dated as of April 16, 2003, pursuant to which
Sellers propose to sell, and Buyer proposes to acquire, certain Assets, as
defined in the Agreement,1 upon the terms and conditions set forth in such
agreement, subject to Bankruptcy Court approval; and
WHEREAS, pursuant to, and subject to the terms and conditions of, this
Escrow Agreement, Buyer has agreed to deliver to Escrow Agent a deposit, in the
amount of $100,000 (the "DEPOSIT"), to be held in escrow pursuant to the terms
of this Escrow Agreement and the Agreement; and
WHEREAS, Escrow Agent acts, and will continue to act, as counsel to
Sellers in connection with, among other things, this Escrow Agreement and the
Agreement; and
WHEREAS, the parties have agreed that Escrow Agent may act as Escrow
Agent hereunder and may represent Sellers, and each of them, in the event of any
dispute regarding this Escrow Agreement or any other matter, including those
involving the Buyer and, including without limitation, the Sellers' bankruptcy
cases; and
WHEREAS, this Escrow Agreement, a copy of which is attached as EXHIBIT
A to the Agreement, is intended to reflect and serve as the escrow agreement
among the parties hereto with respect to the Deposit.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the mutual receipt and
legal sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. APPOINTMENT OF ESCROW AGENT; FORMATION OF THE ESCROW.
1.1 Upon the Escrow Agent's receipt of a duly and properly
executed copy of this Escrow Agreement and the Deposit, the Escrow Agent agrees
to act as Escrow Agent pursuant to the terms of this Escrow Agreement and the
Agreement. The parties hereto hereby authorize and instruct the Escrow Agent to
retain possession of the Deposit in escrow (the "ESCROW") and to disburse the
Deposit in accordance with the terms of this Escrow Agreement.
1.2 The Escrow Agent shall hold the Deposit in an interest
bearing escrow account to be maintained by the Escrow Agent at Citizens Bank,
and which account shall
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1 Capitalized terms, not otherwise defined herein, shall have the meaning
ascribed to them in the Agreement.
be designated as an escrow account. If the Escrow Agent changes the account in
which any or all of the Deposit is held, then the Escrow Agent shall promptly,
but no more than five (5) business days after the date of such change, notify
all parties of the name of the bank, the account number, and account name where
any or all of the Deposit will be deposited.
2. RELEASE OF THE DEPOSIT. The Escrow Agent shall hold the Deposit
until it delivers the Deposit as provided in this Section 2.
2.1 NOTIFICATION AND ACTION. The Escrow Agent shall not make
any distributions of the Deposit except as specifically set forth below. The
Escrow Agent only shall make a distribution of the Deposit or a portion thereof
if so instructed, upon the following:
(a) receipt of written instructions signed jointly by
Buyer and Sellers (the "JOINT INSTRUCTIONS") stating the following:
(i) upon the Closing of the sale of the Assets
as provided in the Agreement, that the Deposit be delivered to Sellers by
federal funds wire transfers of immediately available funds in no event later
than on the Closing Date; or
(ii) if the Agreement is terminated pursuant to
Section 10.01(a), (c), (d), (e) or (g) of the Agreement, that the Deposit be
delivered to Buyer; or
(iii) if the Agreement is terminated pursuant to
Section 10.01(b) of the Agreement, that (A) Fifty Thousand Dollars ($50,000) of
the Deposit be delivered to Buyer, and (B) the remaining Fifty Thousand Dollars
($50,000) of the Deposit be delivered to the Sellers; or
(iv) if the agreement is terminated pursuant to
Section 10.01(f), that the Deposit be delivered to the Sellers;
In the case of Sections 2.1(a)(ii)-(iv), the Deposit, or a portion thereof,
shall be delivered to the relevant party by federal funds wire transfers of
immediately available funds in no event later than one (1) business day
following the date of termination;
or
(b) receipt of an order of a court of competent jurisdiction
directing the distribution of the Deposit or a portion thereof (a "COURT
ORDER").
As promptly as practicable after receipt by the Escrow Agent of the Joint
Instructions or the Court Order, the Escrow Agent shall deliver the Deposit, or
any designated portion thereof, to the party or parties in the manner set forth
in the Joint Instructions or the Court Order, as the case may be; PROVIDED,
HOWEVER, that in all events, the Buyer and Sellers agree that solely Buyer shall
receive any interest earned on the Deposit.
2.2 CONFLICTING NOTIFICATION. In the event of any conflicting
instructions, the Escrow Agent, in its sole and absolute discretion, shall:
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(a) continue to hold the portion of the Deposit which is
the subject of such conflicting instructions until the earlier of (x) its
receipt of a final and non-appealable court order from a court of competent
jurisdiction (in form and substance satisfactory to the Escrow Agent, in its
sole and absolute discretion) directing it to deliver such portion of the
Deposit in accordance with the terms of such court order, in which event the
Escrow Agent shall deliver such portion of the Deposit in accordance therewith
or (y) its receipt of written instructions signed jointly by Buyer and Sellers
directing it to deliver such Deposit in accordance with the terms of such
instructions, in which event the Escrow Agent shall deliver such portion of the
Deposit in accordance therewith; or
(b) at any time after the five day period following the
Escrow Agent's receipt of such conflicting instructions, deliver the portion of
the Deposit which is the subject of such conflicting instructions into the
control of a court of competent jurisdiction, in which event the Escrow Agent
shall have no further obligations or responsibilities with respect thereto.
Notwithstanding the foregoing, the Escrow Agent shall deliver the Deposit, or a
portion thereof, in accordance with the terms of any written instructions
jointly executed by Buyer and Sellers to the extent that such instructions are
received by the Escrow Agent prior to its delivery of the Deposit to a court of
competent jurisdiction in accordance with this clause (b).
3. TERMINATION OF THE ESCROW. The Escrow Agent shall terminate the
Escrow, and the Escrow Agent's duties shall terminate, upon release of the
Deposit in accordance with Section 2 of this Escrow Agreement.
4. INDEMNIFICATION/RELEASE
4.1 In the event of any controversy or threatened controversy
of whatever nature, arising out of, regarding or relating to any aspect of or to
the Escrow, the Deposit or this Escrow Agreement (and regardless of whether or
not such controversy or threatened controversy involves litigation, mediation,
arbitration or other mechanism for dispute resolution), each of the parties
hereto, jointly and severally, bind and obligate themselves and their respective
successors, heirs, executors and assigns to indemnify and hold the Escrow Agent
harmless from and against any claim, loss, liability or expense, and for all
reasonable costs and expenses, including the reasonable fees and expenses of the
Escrow Agent's counsel, incurred in connection with such controversy or
threatened controversy, except as a result of the Escrow Agent's own gross
negligence or willful misconduct. The provisions of this paragraph shall survive
the termination of this Escrow Agreement.
5. DUTIES OF THE ESCROW AGENT.
5.1 The duties and obligations of the Escrow Agent shall be
determined solely by the express provisions of this Escrow Agreement and the
Escrow Agent shall not be liable or responsible except for the performance of
such duties and obligations as are specifically set forth in this Escrow
Agreement.
5.2 The Escrow Agent shall not in any way be bound or
affected by any modification or cancellation of this Escrow Agreement unless in
writing signed by the Escrow Agent and each of the parties hereto. The Escrow
Agent shall be entitled to rely upon any notice, certification, demand or other
writing delivered to the Escrow Agent hereunder in
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accordance with the terms hereof without being required to determine the
authenticity or the correctness of any fact stated therein, the propriety or
validity of the service thereof, or the jurisdiction of the Court issuing any
judgment or order.
5.3 The Escrow Agent may act in reliance upon any signature
reasonably believed by the Escrow Agent to be genuine, and may assume that any
person purporting to give any notice or receipt, or make any statements in
connection with the provisions hereof has been duly authorized to do so. Without
limiting the generality of the immediately preceding sentence, the persons
executing this Escrow Agreement on behalf of each of the parties hereto shall be
assumed by the Escrow Agent as being the duly authorized representative of that
party; provided however, that such signatory may instruct the Escrow Agent in
writing to recognize another person or persons as a party's authorized
signatory.
5.4 The Escrow Agent shall not be required to institute or
defend any action (including interpleader) or legal process involving any matter
referred to herein which in any manner affects the Escrow Agent or the Escrow
Agent's duties or liabilities hereunder.
6. RIGHT OF INTERPLEADER. Should any controversy arise with respect to
this Escrow Agreement or the Deposit, or the right of any party or other person
to receive the Deposit, or should the Escrow Agent be in doubt as to what action
to take, the Escrow Agent shall either (i) withhold delivery of the Deposit
until the controversy is resolved, the conflicting demands are withdrawn or the
Escrow Agent's doubt is resolved as evidenced by a joint written agreement of
the parties to the controversy or by a final and nonappealable order of a court
of competent jurisdiction, each in accordance with the provisions of Section
2.2, if applicable, or (ii) institute a xxxx of interpleader in any court of
competent jurisdiction to determine the rights of the parties hereto (the right
of the Escrow Agent to institute such xxxx of interpleader shall not, however,
be deemed to modify the manner in which the Escrow Agent is entitled to make
disbursements of the Deposit, as set forth above, other than to tender the
Deposit into the registry of such court or as otherwise directed by such court).
Should a xxxx of interpleader be instituted, or should the Escrow Agent be
threatened with litigation or become involved in litigation in any manner
whatsoever on account of this Escrow Agreement or the Deposit, except as a
result of the Escrow Agent's own gross negligence or willful misconduct, then,
as between themselves and the Escrow Agent, the parties hereto, jointly and
severally, hereby bind and obligate themselves, their successors, heirs,
executors and assigns to pay the Escrow Agent its reasonable attorneys' fees and
any and all other reasonable costs, disbursements, expenses, losses and damages
of the Escrow Agent in connection with or resulting from such threatened or
actual litigation.
7. NOTICES.
7.1 Any notice required or permitted to be given hereunder
shall be in writing and shall be (i) personally delivered, (ii) transmitted by
nationally recognized overnight courier, (iii) transmitted by registered or
certified mail, postage prepaid, return receipt requested, or (iv) transmitted
by facsimile to the relevant party at the following address:
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IF TO SELLERS: With a copy to: Xxxxx Xxxxxx LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Med Diversified, Inc. Xxxxxx, XX 00000
000 Xxxxxxxxxx Xxxxxx, Xxxxx 000 Fax: 000-000-0000
Xxxxxxx, XX 00000 Attn: Xxxx X. Xxxxx, Esq.
Fax: 000-000-0000
Attn: Xxxx Xxxxxxx, Esq.
Trestle Corporation
000 Xxxxxxxx Xxx
Xxxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Attn: Xxxxxx Xxxxxxxx
IF TO THE PURCHASER: With a copy to: Xxxxxx Xxxxxxxx & Markiles, LLP
00000 Xxxxxxx Xxxxxxxxx, Xxx. 000
Trestle Acquisition Corp. Xxxxxx, XX 00000
00000 Xxx Xxxxxxx Xxxx., Xxx 000 Fax: 000-000-0000
Xxx Xxxxxxx, XX 00000 Attn: Xxxxx Xxxxxxxx, Esq.
Fax: 000-000-0000
Attn: Xxxx Xxxxxxx
IF TO THE ESCROW AGENT:
Xxxxx Xxxxxx LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Fax: 000-000-0000
Attn: Xxxx X. Xxxxx, Esq
7.2 Notice to any party shall be effective (i) if delivered
personally or by overnight courier, on the date of receipt, (ii) if by mail,
three (3) business days after such notice is deposited in the mail with pre-paid
postage, addressed as above provided, or (iii) if by facsimile, when transmitted
to the appropriate fax number as set forth above and the appropriate
confirmation is received, or receipt is otherwise acknowledged. Any party may
change its address for purposes hereof in a notice specifically designated as a
notice of change of address to each of the other parties hereto, which change of
address shall become effective as of the date of receipt of such notice by all
of the parties hereto.
8. XXXXX XXXXXX LLP. Each party hereto acknowledges that Xxxxx Xxxxxx
LLP currently acts, and will continue to act, as counsel to Sellers, and each
agrees that Xxxxx Xxxxxx LLP may act as Escrow Agent hereunder and may represent
Sellers in the event of any dispute regarding this Escrow Agreement or any other
matter, including those involving the Buyer, including without limitation, the
Sellers' bankruptcy cases.
9. BINDING AGREEMENT. Except with respect to the Agreement, this
Escrow Agreement shall be binding upon and inure only to the benefit of the
parties hereto and their respective successors and assigns.
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10. ENTIRE AGREEMENT. This Escrow Agreement contains the entire
agreement of the parties and supersede all prior written or oral communications
of the parties with respect to the subject matter hereof.
11. AMENDMENT. This Escrow Agreement may not be amended, changed,
waived or modified except by a writing executed by each of the parties hereto.
12. GOVERNING LAW/JURISDICTION. This Agreement shall be construed in
accordance with, and governed by, the laws of the State of
Massachusetts as
applied to contracts made and to be performed entirely in the State of
Massachusetts without regard to principles of conflicts of law. The parties
hereto submit to the exclusive jurisdiction of the Bankruptcy Court with respect
to this Agreement and its enforcement and all matters relating thereto, or any
disputes arising hereunder.
13. SEVERABILITY. The illegality, invalidity, or unenforceability of
any provision of this Escrow Agreement under the law of any jurisdiction shall
not affect its legality, validity, or enforceability under the law of any other
jurisdiction nor the legality, validity, or enforceability of any other
provision.
14. NO STRICT CONSTRUCTION. The parties hereto have participated
jointly in the negotiation and drafting of this Escrow Agreement. In the event
an ambiguity or question of intent or interpretation arises, this Escrow
Agreement shall be construed as if drafted jointly by the parties, and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Escrow Agreement.
15. COUNTERPARTS. This Escrow Agreement may be signed in counterparts,
each of which shall be an original and all of which taken together constitute
one agreement. In making proof of this Escrow Agreement, it shall not be
necessary to produce or account for more than one counterpart signed by the
party to be charged.
16. COUNTERPART FACSIMILE EXECUTION. For purposes of this Escrow
Agreement, a document (or signature page thereto) signed and transmitted by
facsimile machine or telecopier is to be treated as an original document. The
signature of any person thereon, for purposes hereof, is to be considered as an
original signature, and the document transmitted is to be considered to have the
same binding effect as an original signature on an original document.
IN WITNESS WHEREOF, the parties hereto each have executed this Escrow
Agreement as an instrument under seal as of the day and year first above
written.
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XXXXX XXXXXX LLP, as Escrow Agent MED DIVERSIFIED, INC.
By: /S/ XXXX X. XXXXX By: /s/ Xxxxx X. Xxxxxx
------------------- Name: Xxxxx X. Xxxxxx
Name: Xxxx X. Xxxxx, Esq. Title: COO
A member of the firm
TRESTLE CORPORATION
By: /s/ Xxxxxx Xxxxxxxx
Name: Xxxxxx Xxxxxxxx
Title: President
TRESTLE ACQUISITION CORP.
By: /s/ Xxxxxxx Xxxxxxx
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Name: Xxxxxxx Xxxxxxx
Title: Chairman
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