ESCROW AGREEMENT
THIS AGREEMENT is made as of ______________, 2000, by and among
EXCELSIOR VENTURE INVESTORS III, LLC (the "Company") and PNC BANK, DELAWARE
(the "Escrow Agent") and PFPC INC. (the "Escrow Administrator").
WITNESSETH
WHEREAS, the Company has retained PFPC Inc. to provide certain
administration, accounting and investor services pursuant to an
Administration, Accounting and Investor Services Agreement dated as of
_________, 2000.
WHEREAS, the Company desires that PNC Bank, Delaware, an affiliate
of PFPC Inc. to provide certain services as escrow agent, as described
herein, and PNC Bank, Delaware wishes to provide such services.
WHEREAS, PNC Bank, Delaware appoints PFPC Inc. as Escrow
Administrator to perform certain ministerial duties relative to the Escrow
Account;
NOW THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
1. ACCEPTANCE BY ESCROW AGENT. The Escrow Agent hereby accepts the
appointment as escrow agent hereunder and agrees to act on the terms and
conditions hereinafter set forth.
2. RIGHTS AND RESPONSIBILITIES OF ESCROW AGENT. The acceptance by
the Escrow Agent of its duties hereunder is subject to the following terms
and conditions, which the parties to this Agreement hereby agree shall
govern and control the Escrow Agent's rights, duties, liabilities and
immunities.
(a) The Escrow Agent shall act hereunder as a depository
only, and in its capacity as such, it shall not be
responsible or liable in any manner whatever for the
sufficiency, correctness, genuineness or validity of (i) any
document furnished to the Escrow Agent or Escrow
Administrator or (ii) any asset deposited with it.
(b) "Written Instructions" mean written instructions received
by the Escrow Agent or Escrow Administrator and signed by any
person named on the attached Authorized Persons List
("Authorized Person"). The instructions may be delivered by
hand, mail, facsimile, cable, telex or telegram; except that
any instruction terminating this Agreement may be given only
by hand or mail.
The Escrow Agent may rely and shall be protected for
any action or omission it takes pursuant to Written
Instructions if it, in good faith, believes such Written
Instructions to be genuine. Unless otherwise provided in this
Agreement, the Escrow Agent shall act only upon Written
Instructions. The Escrow Agent shall be entitled to assume
that any Written Instruction received hereunder is not in any
way inconsistent with the provisions of the Company's limited
liability company agreement or this Agreement or of any vote,
resolution or proceeding of the Company's Board of Managers
or of the Company's members, unless and until the Escrow
Agent receives Written Instructions to the contrary.
(c) The Escrow Agent shall be obligated to exercise care and
diligence in the performance of its duties hereunder, to act
in good faith and to use its best efforts, within reasonable
limits, in performing services provided for under this
Agreement. The Escrow Agent shall be liable for any damages
arising out of its failure to perform its duties under this
Agreement to the extent such damages arise out of its willful
misfeasance, bad faith, gross negligence or reckless
disregard of such duties.
(d) Notwithstanding anything in this Agreement to the
contrary, neither the Escrow Agent nor its affiliates shall
be liable to the Company for any consequential, special or
indirect losses or damages which the Company may incur or
suffer by or as a consequence of the Escrow Agent's or any
affiliates' performance of the services provided hereunder,
whether or not the likelihood of such losses or damages was
known by the Escrow Agent or its affiliates.
(e) Without limiting the generality of the foregoing or of
any other provision of this Agreement, the Escrow Agent and
its affiliates shall not be liable for losses beyond its
control, provided it has acted in accordance with the
standard of care set forth above; and the Escrow Agent and
its affiliates shall not be liable for delays or errors or
loss of data occurring by reason of circumstances beyond its
control, including acts of civil or military authority,
national emergencies, labor difficulties, fire, flood,
catastrophe, acts of God, insurrection, war, riots or failure
of the mails, transportation, communication or power supply.
(f) The Company agrees to indemnify the Escrow Agent and its
affiliates and hold it harmless from and against any tax,
charge, loss, liability, expense (including reasonable
attorneys fees and expenses), claim or demand arising
directly or indirectly from any action or omission to act
which the Escrow Agent or the Escrow Administrator takes (i)
at the request or on the direction of or in reliance on the
advice of the Company or (ii) upon Written Instructions;
provided, however, that neither the Escrow Agent, nor any of
its affiliates, shall be indemnified against any liability
(or any expenses incident to such liability) arising out of
the Escrow Agent's or its affiliates own willful misfeasance,
bad faith, gross negligence or reckless disregard of its
duties and obligations under this Agreement. The Company
shall indemnify and hold harmless the Escrow Agent and its
affiliates against and in respect of any liability for taxes
and for any penalties or interest in respect of taxes
attributable to the investment of funds held in escrow by
Escrow Agent pursuant to this Agreement. These indemnities
shall survive the resignation of the Escrow Agent or the
termination of this Escrow Agreement. Notwithstanding
anything in this Agreement to the contrary, neither the
Company nor its affiliates shall be liable for any
consequential, special or indirect losses or damages, whether
or not the likelihood of such losses or damages was known by
the Company or its affiliates.
(g) The Escrow Agent shall have no duties except those
specifically set forth in this Agreement.
(h) The Escrow Agent shall have the right at any time it
deems appropriate to seek an adjudication in court of
competent jurisdiction as to the respective rights of the
parties hereto and shall not be held liable by any party
hereto for any delay or the consequences of any delay
occasioned by such resort to court.
(i) The Escrow Agent shall promptly notify an Authorized
Person of any discrepancy between the amounts set forth on
any remittance advice received by Escrow Agent and the sums
delivered to it therewith.
(j) The Escrow Administrator agrees to indemnify the Escrow
Agent and hold it harmless from and against any tax, charge,
loss, liability, expense (including reasonable attorneys'
fees and expenses), claim or demand arising directly or
indirectly from any action or omission to act on the part of
the Escrow Administrator in the performance of its duties and
obligations under this Agreement.
3. DEFINITIONS. Except as specifically set forth herein, the terms
used in this Agreement shall have the same meaning as set forth in the
Administration, Accounting and Investor Services Agreement between the
Company and PFPC Inc.
4. DEPOSIT OF ESCROW FUND. The Escrow Agent shall establish an
account in such of the following names as may be set forth in Written
Instructions or agreed to between the parties hereto in a separate writing:
"Potential Investors of Excelsior Venture Investors III, LLC" (hereinafter
the "Subscription Account"). A separate account, if necessary, may be
established titled "U.S. Trust Company" (hereinafter the "Adviser's
Account") (individually, an "Account" and, collectively, the "Accounts").
The Accounts shall be established at Escrow Agent. Escrow Agent appoints
Escrow Administrator to act as signatory to the Accounts and to perform all
administrative and ministerial functions related to the Accounts. Assets of
the Accounts will earn interest at prevailing market rates pursuant to
arrangements approved by the Company and Escrow Agent. The Company shall
only approve investments permissible under Rule 15c2-4 of the Securities
Exchange Act of 1934, as amended. Any checks should be made payable to PNC
Bank, Delaware and must be transmitted by Selling Agents directly to the
Escrow Administrator by noon of the next business day after receipt. The
Escrow Administrator shall promptly deposit Subscription Account checks
remitted by persons subscribing to purchase interests in the Company
("Potential Investors"). Potential Investors may also deposit monies in the
Subscription Account (if established) by wire transfer instructions
provided to them by the Company. The Escrow Agent may accept bulk wires at
the direction of an Authorized Person that represent an aggregate amount of
money previously deposited directly into the investors' brokerage accounts
by such investors. The Escrow Agent and the Escrow Administrator will
maintain records related to each of the Accounts in accordance with
applicable regulatory requirements and the Escrow Agent's and Escrow
Administrator's record retention policies.
5. STATEMENTS. During the term of this Agreement, Escrow Agent
shall provide the Company with monthly statements containing the beginning
balance in each of the Accounts as well as all principal and income
transactions for the statement period and with a daily summary of amounts
deposited and status of available funds. The Company shall be responsible
for reconciling such statements. The Escrow Agent shall be forever released
and discharged from all liability with respect to the accuracy of such
statements, except with respect to any such act or transaction as to which
the Company shall, within 90 days after the furnishing of the statement,
file written objections with the Escrow Agent.
6. DISTRIBUTIONS AND CLOSINGS. Upon Written Instructions, at each
closing of each offering of interests in the Company, the Escrow
Administrator will wire principal balances on deposit in the Subscription
Account to the Company's account at the Company's custodian. Such Written
Instructions shall be sent to the Escrow Administrator by 2:00 p.m. on the
closing date with respect to each closing. In the event that a Potential
Investor who has escrow funds in the Subscription Account is not admitted
into the Company, upon Written Instructions, the Escrow Administrator shall
promptly issue refunds to the Potential Investor in check form in the
amount of the principal balance with accrued interest.
7. INTEREST/EARNINGS. All interest earned on the escrow funds
deposited in the Subscription Account hereunder shall be added to and held
in the Accounts. Upon each closing, pursuant to Written Instructions,
within 5 business days the Escrow Administrator shall issue interest
payments in check form to each Potential Investor based on his individual
balance in the Subscription Account along with a cover letter and to U.S.
Trust Company based upon its balance in the Adviser's Account along with a
cover letter. The Escrow Administrator will prepare and send notifications
on Form 1099 for each calendar year to all persons who have received
distributions of earnings reflecting their respective shares of such
earnings.
8. RESERVED.
9. TAX IDENTIFICATION NUMBER. All deposits to the Accounts
shall be subject to the Escrow Agent's receipt of a valid tax
identification number for the Company or Potential Investor, as applicable.
10. COMPENSATION. The fees and account related charges of the
Escrow Agent and Escrow Administrator for its services hereunder shall be
paid by the Company as may be mutually agreed to in writing by the Company
and Escrow Agent and Escrow Administrator.
11. AMENDMENT. This Agreement may not be amended or
supplemented and no provision hereof may be modified or waived, except by
an instrument in writing, signed by all of the parties hereto.
12. TERMINATION. The Escrow Agreement shall continue until
terminated by either party on sixty (60) days' prior written notice. Upon
the termination of this Agreement and upon the delivery of the balance of
the Accounts by the Escrow Agent to a successor escrow agent or such other
person as may be designated by Written Instructions, the Escrow Agent and
the Escrow Administrator shall be relieved of any and all further
obligations hereunder and it shall be released and discharged from all
further obligations hereunder, other than such obligations arising under
Section 2(e) above as may then exist.
If no successor Escrow Agent or other person has been designated
pursuant to Written Instructions to receive the balance of the Accounts at
the expiration of the sixty (60) day period, the Escrow Agent shall have no
further obligation hereunder except to hold the escrow funds as a
depositary, except as explicitly stated in the previous paragraph. Upon
Written Instructions of the appointment of the successor, the Escrow Agent
shall promptly deliver the balance of the Accounts to such successor.
13. EXECUTION. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but such
counterparts together shall constitute one and the same instrument.
14. MISCELLANEOUS. All covenants and agreements contained in this
Agreement by or on behalf of the parties hereto shall bind and inure to the
benefit of such parties and their respective heirs, administrators, legal
representatives, successors and assigns, as the case may be. The headings
in this Agreement are for convenience of reference only and shall neither
be considered as part of this Agreement, nor limit or otherwise affect the
meaning thereof. This Agreement shall be construed and enforced in
accordance with the laws of Delaware without regard to principles of
conflicts of law.
15. NOTICES. All instructions, notices and other communications
hereunder must be in writing and shall be deemed to have been duly given if
delivered by hand, facsimile or mailed by first class, registered mail,
return receipt requested, postage prepaid, and addressed as follows:
(a) If to the Company:
Excelsior Venture Investors III, LLC
x/x Xxxxxx Xxxxxx Xxxxx Xxxxxxx xx Xxx Xxxx
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, X.X. 00000
(b) If to the Escrow Administrator:
PFPC Inc., Attn: Xxxxxx Xxx Xxxx
000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
(c) If to the Escrow Agent:
PNC Bank, Delaware, Attn: Xxxxxxx Xxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
16. PARTIAL INVALIDITY. If any provision of this Agreement
shall be held or made invalid by a court decision, statute, rule or
otherwise, the remainder of this Agreement shall not be affected thereby.
17. ENTIRE AGREEMENT. This Agreement embodies the entire agreement
and understanding among the parties and supersedes all prior agreements and
understandings relating to the Accounts, provided that the parties may
embody in one or more separate documents their agreement, if any, with
respect to delegated duties and instructions.
IN WITNESS THEREOF, the parties hereto have caused this Agreement
to be executed as of the date first above written.
EXCELSIOR VENTURE INVESTORS III, LLC
By: : _______________________________
Title: : ____________________________
PFPC INC.
By: ________________________________
Title: _____________________________
PNC BANK, DELAWARE
By: ________________________________
Title: _____________________________
AUTHORIZED PERSONS LIST
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