Exhibit 99.3
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of September 30, 1999 (this "Escrow
Agreement") among Xxxxxx Xxxxxxxx, L.L.P., as escrow agent (the "Escrow Agent"),
and Celerity Systems, Inc., a Delaware corporation, having an address at 0000
Xxxxxxxxxxx Xxxxxxxxx, Xxxxxxxxx, Xxxxxxxxx, 00000 (the "Company"), and GMF
Holdings, ("Investor").
WHEREAS, Investor and the Company have entered into line of credit
agreement (the "Agreement") date as of the 30th of September 1999 whereby
Investor agreed to grant bridge financing to the Company, subject to the terms
and conditions of the Agreement.
WHEREAS, pursuant to Agreement, Investor and the Company agreed to
enter into this Escrow Agreement with Escrow Agent in order for Escrow Agent to
hold the Advance Amount (as delivered to Escrow Agent by Investor) and the
certificates representing the shares (as delivered to Escrow Agent by the
Company) for release to the Company and Investor, respectively, in accordance
with this Agreement; and
NOW, THEREFORE, Investor, the Company and the Escrow Agent hereby agree
as follows:
1. APPOINTMENT OF ESCROW AGENT; DEPOSIT OF ESCROW AMOUNT AND
DEBENTURES. The Company and Investor hereby constitute and appoint the Escrow
Agent as, and the Escrow Agent hereby agrees to assume and perform the duties of
the escrow agent under and pursuant to this Escrow Agreement. The Escrow Agent
acknowledges that he will receive from the Company Debentures corresponding to
such Advance Amount, as provided in the Agreement.
2. ESCROW FUND; DEBENTURES. The Escrow Fund shall be held by the Escrow
Agent in a separate account maintained for the purpose of effecting the
Closings, on the terms and subject to the conditions of this Escrow Agreement.
The Escrow Agent shall hold in escrow the Debentures separately from the Escrow
Fund and agrees that the Debentures shall be held on the terms and subject to
the conditions set forth herein. The Debentures and the Escrow Fund shall not be
subject to lien or attachment by any creditor of any part hereto and shall be
used solely for the purpose set forth in this Escrow Agreement. The Debentures
and the Escrow Fund shall not be available to, and shall not be used by, the
Escrow Agent to set off any obligations of either Investor or the Company owing
to the Escrow Agent in any capacity, except as expressly provided in Section 2.1
of the Agreement.
3. DELIVERIES TO EFFECT CLOSING. Upon the receipt by the Escrow Agent
of the Debentures, Investor and the Company shall irrevocably instruct the
Escrow Agent to pay over to the Company the amount of the advance in the Escrow
Fund, in immediately available funds to a bank account of the Company's
designation, except as expressly provided in Section 2.3 of the agreement.
4. RELEASE OF ESCROW FUND AND DEBENTURES UPON FAILURE TO CLOSE. If upon
the expiration of two (2) Trading Days after any Closing Date, the Escrow Agent
has not received the Debentures with respect to such Closing Date, the Investor
and the Company irrevocably instruct the Escrow Agent to pay over to Investor
all amounts of the Escrow Fund, in immediately available funds, to a bank
account or Investor's designation.
5. DUTIES AND OBLIGATIONS OF THE ESCROW AGENT. The duties and
obligations of the Escrow Agent are purely ministerial and shall be limited to
and determined solely by the provisions of this Agreement. The Escrow Agent is
not charged with knowledge of or any duties or responsibilities in respect of
any other agreement or document. In furtherance and not in limitation of the
foregoing:
(i) the Escrow Agent shall not be liable for any loss of
interest sustained as a result of investments made hereunder
in accordance with the terms hereof, including any liquidation
of any investment of the Escrow Fund prior to its maturity
effected in order to make a payment required by the terms of
this Escrow Agreement;
(ii) the Escrow Agent shall be fully protected in relying in
good faith upon any written certification, notice, direction,
request, waiver, consent, receipt or other document that the
Escrow Agent reasonably believes to be genuine and duly
authorized, executed and delivered;
(iii) the Escrow Agent shall not be liable for any error of
judgment, or for any act done or omitted by it, or for any
mistake in fact or law, or for anything that if may do or
refrain from doing in connection herewith; PROVIDED, HOWEVER,
that notwithstanding any other provision in this Agreement,
the Escrow Agent shall be liable for its willful misconduct or
gross negligence or breach of this Agreement.
(iv) the Escrow Agent may seek the advice of legal counsel
selected with reasonable care in the event of any dispute or
question as to the construction of any of the provisions of
this Agreement or its duties hereunder, and it shall incur no
liability and shall be fully protected in respect of any
action taken, omitted or suffered by it in good faith in
accordance with the opinion of such counsel;
(v) in the event that the Escrow Agent shall in any instance,
after seeking the advice of legal counsel pursuant to the
immediately preceding clause, in good faith be uncertain as to
its duties or rights hereunder, it shall be entitled to
refrain from taking any action in that instance and its sole
obligation, in addition to those of its duties hereunder as to
which there is no such uncertainty, shall be to keep safely
all property held in the Escrow Fund until it shall be
directed otherwise in writing by each of the parties hereto or
by a final, nonappealable order of a court
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of competent jurisdiction; PROVIDED, HOWEVER, in the event
that the Escrow Agent has not received such written direction
or court order within one hundred eighty (180) calendar days
after requesting the same, it shall have the right to
interplead Investor and the Company in any court of competent
jurisdiction and request that such court determine its rights
and duties hereunder; and
(vi) the Escrow Agent may execute any of its powers or
responsibilities hereunder and exercise any rights hereunder
either directly or by or through agents or attorneys selected
with reasonable care, nothing in this Agreement shall be
deemed to impose upon the Escrow Agent any duty to qualify to
do business or to act as fiduciary or otherwise in any
jurisdiction other than the State of New York and the Escrow
Agent shall not be responsible for and shall not be under a
duty to examine into or pass upon the validity, binding
effect, execution or sufficiency of this Agreement or of any
agreement amendatory or supplemental hereto.
6. COOPERATION. Investor and the Company shall provide to the Escrow
Agent all instruments and documents within their respective powers to provide
that are necessary for the Escrow Agent to perform its duties and
responsibilities hereunder.
7. EXPENSES: INDEMNITY. The company hereby agrees to pay or reimburse
the Escrow Agent upon request for all expenses, disbursement and advances,
including reasonable attorney's fees, incurred or made by it in connection with
the preparation, execution, performance, delivery, modification and termination
of this Agreement; provided that Investor shall bear all expenses of the
investment and reinvestment of the Escrow Fund. The Company hereby agrees to
indemnify the Escrow Agent for, and to hold it harmless against any loss,
liability or expense arising out of or in connection with this Agreement and
carrying out its duties hereunder, including the costs and expenses of defending
itself against any claim of liability, except in those cases where the Escrow
Agent has been guilty of gross negligence, willful misconduct or in breach of
this Agreement. Anything in this Agreement to the contrary notwithstanding, in
no event shall the Escrow Agent be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits) even if the Escrow Agent has been advised of the likelihood of such
loss or damage and regardless of the form of action. The provisions of this
Section shall survive any termination of this Agreement, whether by disbursement
of the collateral held, resignation of the Escrow Agent, or otherwise.
8. RESIGNATION AND REMOVAL OF THE ESCROW AGENT.
(a) The Escrow Agent may resign as such thirty (30) calendar days
following the giving of prior written notice thereof to the Company and
Investor. In addition, the Escrow Agent may be removed and replaced on a date
designated in a written instrument signed by the Company and Investor and
delivered to the Escrow Agent. Notwithstanding the foregoing, no such
resignation or removal shall be effective until a successor escrow agent has
acknowledged its appointment as such as provided in paragraph (c) below. In
either event, upon the effective date of such resignation or removal, the Escrow
Agent shall deliver the property comprising the Escrow Fund and the Stock
Certificate to such successor escrow agent, together with such
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records maintained by the Escrow Agent in connection with its duties hereunder
and other information with respect to the Escrow Fund as such successor may
reasonably request.
(b) If a successor escrow agent shall not have acknowledged its
appointment as such provided in paragraph (c) below, in the case of a
resignation, prior to the expiration of thirty (30) calendar days following the
date of a notice of resignation or in the case of a removal, on the date
designated for the Escrow Agent's removal, as the case may be, because the
Company and Investor are unable to agree on a successor escrow agent, or for any
other reason, the Escrow Agent may select a successor escrow agent and any such
resulting appointment shall be binding upon all of the parties to this
Agreement, provided that any such successor selected by the Escrow Agent shall
be a depository institution or trust company that is designated in writing by
the Investor and is incorporated under the laws of the United States of America,
any State thereof or the District of Columbia and has total assets in excess of
U.S. $500 million.
(c) Upon written acknowledgment by a successor escrow agent appointed
in accordance with the foregoing provisions of this Section of its agreement to
serve as escrow agent hereunder and the receipt of the property then comprising
the Escrow Fund and the Debentures, the Escrow Agent shall be fully released and
relieved of all duties, responsibilities and obligations under this Agreement,
subject to the provisions contained in clause (iii) of Section 5, and such
successor escrow agent shall for all purposes hereof be the Escrow Agent.
9. NOTICES. All notices, requests and other communications hereunder
must be in writing and will be deemed to have been duly given if delivered
personally or by facsimile transmission (with confirmation generated by the
sending machine) or mailed (first class postage prepaid) to the parties at the
following addresses or facsimile numbers:
If to the Company:
CELERITY SYSTEMS, INC.
0000 Xxxxxxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxxxxxx, 00000
If to the Investor:
GMF Holdings
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx
If to the Escrow Agent:
Xxxxxx Xxxxxxxx, L.L.P.
0000 Xxxxxxxxxx Xxxxxx
Xxxxx, Xxx Xxxxxx 00000
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All such notices, requests and other communications will (i) if
delivered personally to the address as provided in this Section, be deemed given
upon delivery, (ii) if delivered by facsimile transmission to the facsimile
number as provided in this Section, be deemed given upon receipt, and (iii) if
delivered by mail in the manner described above to the address as provided in
this Section, be deemed given upon receipt (in each case regardless of whether
such notice, request or other communication is received by any other Person to
whom a copy of such notice is to be delivered pursuant to this Section). Any
party from time to time may change its address, facsimile number or other
information for the purpose of notices to that party by giving notice specifying
such change to the other parties hereto.
10. AMENDMENTS, ETC. This Agreement may be amended or modified, and any
of the terms hereof may be waived, only by a written instrument duly executed by
or on behalf of Investor and the Company and, with respect to any amendment that
would adversely affect the Escrow Agent. No waiver by any party of any term or
condition contained of this Agreement, in any one or more instances, shall be
deemed to be or construed as a waiver of the same or any other term or condition
of this Agreement on any future occasion.
11. GOVERNING LAW. This Agreement shall be construed under the laws of
the State of New York. Each of the parties consents to the jurisdiction of the
U.S. District Court sitting in the Southern District of the State of New York or
the state courts of the State of New York sitting in Manhattan in connection
with any dispute arising under this Debenture and hereby waives, to the maximum
extent permitted by law, any objection, including any objection based on FORUM
NON CONVENIENS to the bringing of any such proceeding in such jurisdictions.
12. BUSINESS DAY. For all purposed of this Agreement, the terms
"business day" shall mean a day other than Saturday, Sunday or any day on which
banks located in the State of New York are authorized or obligated to close.
13. ENTIRE AGREEMENT. It is understood and agreed that this Escrow
Agreement supersedes all understandings and agreements heretofore had between
the parties hereto with respect to the subject matter hereof, and contains the
sole and entire agreement between the parties with respect to the subject matter
hereof.
14. ASSIGNMENT. Neither this Agreement nor any right, interest, or
obligation hereunder may be assigned by any party without the prior written
consent of the other parties and any attempt to do so will be void, except that
Investor may assign all of its rights, interest and obligations hereunder at any
time, in whole or in part, to any other person or entity (including any
affiliate of the Investor) upon the prior written consent of the Company, which
consent shall not be unreasonably withheld. Investor and the Company shall
provide to the Escrow Agent written notice of such an assignment by Investor.
15. MISCELLANEOUS. This Agreement is binding upon and will inure to the
benefits of the
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parties hereto and their respective successor and permitted assigns. The
headings used in this Agreement have been inserted for convenience of reference
only and do not define or limit the provisions hereof. This Escrow Agreement may
be signed by facsimile copy (followed by originals) and, in addition, may be
executed in several counterparts, each of which shall be deemed an original but
all of which shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
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/s/ Xxxxxxx X. Van Meter
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Celerity Systems, Inc.
By: Xxxxxxx Van Meter
Chief Executive Officer
/s/ Xxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx, L.L.P.
By: Xxxxx Xxxxxxxx, Esq.
/s/ Xxxxx Xxxxx
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GMF Holdings
By: Xxxxx Xxxxx
Chief Executive Officer
