EXHIBIT 10.49
INDEMNITY ESCROW AGREEMENT
INDEMNITY ESCROW AGREEMENT dated as of September __, 1997 by and between
MicroTel International Inc. ("MicroTel"), CXR Telcom Corporation ("CXR"), Xxxx
X. Xxxxxxxx, Xxxxx X. Xxxxxxx and Xxxx Xxxxxxxxx (collectively the "Selling
Shareholders") and Xxxxxxxxx, Xxxxxx & Xxxxxx as escrow agent (the "Escrow
Agent").
W I T N E S S E T H:
WHEREAS, MicroTel, CXR, Critical Communications, Inc. ("Critical") and the
Selling Shareholders are parties to a Share Exchange Agreement dated as of
September __, 1997 (the "Share Exchange Agreement") pursuant to which CXR has
acquired from the Selling Shareholders all of the outstanding shares of Critical
for a purchase price (the "Purchase Price") consisting of shares of common stock
of MicroTel, 100,000 of which are subject to this Escrow Agreement (the
"Shares"), and
WHEREAS, the Selling Shareholders have agreed to deliver this Escrow
Agreement as security for the indemnification obligations of the Selling
Shareholders under the Share Exchange Agreement.
NOW, THEREFORE, the parties hereto, in consideration of their mutual
covenants and intending to be legally bound hereby agree as follows:
1. All terms used herein and not defined herein shall have the meaning
set forth in the Share Exchange Agreement.
2. On the date hereof the Selling Shareholders shall deliver to the
Escrow Agent certificates for the 100,000 Shares, in negotiable form, with
separate stock transfer powers duly endorsed in blank (the "Escrowed Shares").
3. The Escrow Agent agrees to hold the Escrowed Shares and deliver the
Escrowed Shares to the Selling Shareholders or to MicroTel in accordance with
the provisions of this Escrow Agreement.
4. (a) In the event the Selling Shareholders and MicroTel agree in
writing that MicroTel shall be entitled to indemnification from the Selling
Shareholders under Section 6 of the Share Exchange Agreement then the Escrow
Agent shall deliver to MicroTel Escrowed Shares equal in value to the amount of
MicroTel's claim, with each Escrowed Share having a value of $2.00 for purposes
of this section.
(b) The Escrow Agent shall deliver the Escrowed Shares to MicroTel
as set forth above only in the event the Selling Shareholders and MicroTel
agree in writing that the amount of the indemnification shall be finally
deemed to be a liability of the Selling Shareholders pursuant to the terms of
Section 6 of the Share Exchange Agreement.
5. The Escrowed Shares which shall not have been delivered to MicroTel
under Section 4 of this Agreement, or which Purchaser has not made a claim upon
in writing to the Escrow Agent, shall be delivered by the Escrow Agent to the
Selling Shareholders on September __, 1998.
6. All cash dividends payable on the Escrowed Shares shall be paid to
the Selling Shareholders. The Selling Shareholders shall be entitled to vote
the Escrowed Shares for all valid purposes for which such Shares are entitled
to vote. There shall be added to the Escrowed Shares stock dividends, stock
splits or distributions of stock of other companies with respect to the
Escrowed Shares.
7. The acceptance by the Escrow Agent of its duties as such under this
Escrow Agreement is subject to the following terms and conditions, which all
parties to this Escrow Agreement hereby agree shall govern and control with
respect to the rights, duties, liabilities and immunities of the Escrow Agent.
(a) The Escrow Agent shall be protected in acting upon any written
notice, request, waiver, consent, receipt or other paper or document which
the Escrow Agent in good faith believes to be genuine.
(b) The Escrow Agent shall not be liable for any error of judgment,
or for any act done or step taken or omitted by it in good faith, or for
anything which it may do or refrain from doing in connection herewith,
except its own negligence or misconduct.
(c) The Escrow Agent may consult with, and obtain advice from, legal
counsel in the event of any dispute or question as to the construction of
any of the provisions hereof or its duties hereunder, and it shall incur no
liability and shall be fully protected in acting in good faith in
accordance with the opinion and instructions of such counsel.
8. The Escrow Agent shall be entitled to reasonable compensation for its
services hereunder, including reimbursement for reasonable counsel fees and
other out-of-pocket expenses incurred by the Escrow Agent in the performance of
its duties hereunder. The compensation so payable shall be paid by MicroTel
unless incurred as a result of a controversy between the Purchaser and the
Seller in which case such compensation shall be borne equally by MicroTel and
the Selling Shareholders.
9. This Agreement sets forth the entire understanding of the parties
hereto with respect to the transactions contemplated hereby. It shall not be
amended or modified except by written instrument duly executed by each of the
parties hereto.
10. This Agreement may not be assigned by any party hereto without the
prior written consent of the other parties. Subject to the foregoing, all of
the terms and provisions of this
-2-
Agreement shall be binding upon and inure to the benefit of and be
enforceable by the successors and assigns of the Parties hereto.
11. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing
and shall be deemed given only if delivered personally or sent by registered
or certified mail, postage prepaid, to the address set forth in the Share
Exchange Agreement or to such other address as the addressee may have
specified in a notice duly given to the sender as provided herein. Such
notice, request, demand, waiver, consent, approval or other communication
will be deemed to have been given as of the date so delivered.
12. THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA. THE PARTIES HEREBY AGREE
THAT ANY PROCEEDING WITH RESPECT TO ENFORCEMENT OF THIS AGREEMENT SHALL BE IN
CALIFORNIA.
13. The covenants and agreements contained in this Agreement are for the
sole benefit of the parties hereto.
14. This Agreement may be executed in any number of counterparts and any
party hereto may execute any such counterpart, each of which when executed and
delivered shall be deemed to be an original and all of which counterparts taken
together shall constitute but one and the same instrument. This Agreement shall
become binding when one or more counterparts taken together shall have been
executed and delivered by the parties. It shall not be necessary in making
proof of this Agreement or any counterpart hereof to produce or account for any
of the other counterparts.
15. Should any litigation or arbitration proceeding be commenced between
the parties to this Agreement concerning this Agreement, any provisions of this
Agreement, or the rights and obligations of either in relation thereto, or the
performance hereof, the party prevailing in such proceeding shall be entitled,
in addition to such other relief as may be granted, to a reasonable sum as and
for that party's attorney's fees in said proceeding.
-3-
IN WITNESS WHEREOF, this Indemnity Escrow Agreement has been executed as of
the day and year first above written.
MICROTEL INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx, Chairman,
President and Chief Executive
Officer
CXR TELCOM CORPORATION
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Xxxxx X. Xxxxxx, President
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------
Xxxx X. Xxxxxxxx
By: /s/ Xxxxx X. Xxxxxxx
--------------------------------
Xxxxx X. Xxxxxxx
By: /s/ Xxxx Xxxxxxxxx
--------------------------------
Xxxx Xxxxxxxxx
-4-
