ESCROW AGREEMENT
Exhibit 10.1
THIS ESCROW AGREEMENT (as the same may
be amended or modified from time to time pursuant hereto, this “Escrow Agreement”) is made and
entered into as of February 12, 2008 by and among Pet DRx Corporation (f/k/a
Echo Healthcare Acquisition Corp.) (“Purchaser”) a Delaware
corporation, and the undersigned Stockholders Representatives (“Representatives”, and together
with Purchaser, sometimes referred to individually as “Party” or collectively as the
“Parties”) in their
capacity as the Stockholders Representatives designated pursuant to the Merger
Agreement (as defined below), and JPMorgan Chase Bank, National Association (the
“Escrow
Agent”).
WHEREAS, Purchaser has entered
into a Second Amended and Restated Merger Agreement (the “Merger Agreement”) dated as of
October 23, 2007 by and among Purchaser, a wholly-owned subsidiary of Purchaser
(“Merger Sub”) and XLNT
Veterinary Care, Inc., a Delaware corporation (“XLNT”);
WHEREAS, under the Merger
Agreement, XLNT and its stockholders have authorized and empowered the
Stockholders Representatives to act on their behalf in connection with this
Escrow Agreement;
WHEREAS, pursuant to the Merger Agreement, on
January 4, 2008, Merger Sub merged with and into XLNT, with XLNT surviving the
merger as a wholly-owned subsidiary of Purchaser;
WHEREAS, the provisions of the Merger Agreement
are hereby incorporated herein by reference as the context of this Escrow
Agreement may require, provided that the Escrow
Agent shall act only in accordance with the terms and conditions contained
herein; and
WHEREAS, the Parties have
agreed to deposit in escrow certain property and wish such deposit to be subject
to the terms and conditions set forth herein.
NOW THEREFORE, in
consideration of the foregoing and of the mutual covenants hereinafter set
forth, the parties hereto agree as follows:
1. Appointment. The Parties
hereby appoint the Escrow Agent as their escrow agent for the purposes set forth
herein, and the Escrow Agent hereby accepts such appointment under the terms and
conditions set forth herein.
2. Escrow Fund.
(a)
On or as soon as practicable after the 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 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 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 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 herein as the
“Escrow
Fund”). The Escrow Agent shall hold, exercise voting rights
with respect to and 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 is not acting in a capacity that would
warrant the re-issuance, sale, or denominational breakdown of any shares by the
Escrow 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.
1
(b) If
Purchaser at any 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,
recapitalization or otherwise) its outstanding shares of Common Stock into a
greater number of shares, or (ii) combines (by reverse stock split or
otherwise) its outstanding shares of Common Stock into a smaller number of
shares, then the Purchaser will deliver notice thereof to the Escrow Agent, and,
unless the applicable authorizing Board of 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 date with respect thereto deliver to
the Escrow Agent in book-entry form the requisite Escrow Shares as may be
required to reflect the applicable increase or reduction of such Escrow
Shares. The Escrow Agent shall be entitled to execute 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 of this Escrow Agreement and the final disposition
of the Escrow Fund in accordance with this Escrow Agreement pays any
distribution or dividend in respect of the Escrow Shares in additional shares of
Common Stock, then the Purchaser will deliver notice thereof to the Escrow Agent
and the Representatives, and, unless the applicable authorizing Board of
Directors resolutions do not require delivery of additional Escrow Shares as a
result of 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 Common Stock. Upon such
delivery referred to in this Section 2.1(c), the Escrow Agent shall hold such
additional or substitute Escrow Shares and “Escrow Shares” shall refer to the
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 Common Stock (then held in the
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 Escrow Fund, the
Purchaser and the Representatives shall negotiate in good faith, and execute and
deliver, such supplemental written instructions to the Escrow Agent as are
necessary to account for such other securities or property in a manner
consistent with the results that would have prevailed if only Common Stock and
cash (and interest earned thereon) were held in 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 execute and deliver any transmittal letter or
other documents and Escrow Shares required in connection with such any
recapitalization, reclassification, merger, consolidation or similar event to receive any shares of
stock, securities, properties or cash in exchange for Escrow
Shares.
2
(d) Upon
written instructions from the Representatives from time to time, 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 revoked by the Escrow Agent with respect
to any Escrow Shares delivered to the Purchaser or the Representatives
hereunder, prior to such delivery.
3. Investment of Escrow
Fund.
(a) The Parties recognize and agree that the
Escrow Agent will not provide supervision, recommendations or advice relating to
either the investment of moneys or any other assets held in the Escrow Fund or the purchase, sale, retention or
other disposition of any investment described herein. The Escrow Agent shall not liquidate,
sell, invest or reinvest any portion of the Escrow Fund except as provided
herein and shall hold the Escrow Shares and any cash or other assets received in
respect thereof in the form initially received. The Escrow Agent shall not have any
liability for any loss sustained as a result of any investment or the failure to make an investment made pursuant to the terms
of this Escrow Agreement or as a result of any liquidation of any investment
prior to its maturity or for the failure of the Parties to give the Escrow Agent
instructions to invest or reinvest the Escrow Fund. The Escrow Agent
shall have the right to liquidate any investments held in order to provide funds
necessary to make required payments under this Escrow
Agreement.
(b) Receipt of the Escrow Shares shall be confirmed by Escrow Agent as
soon as practicable after
receipt thereof by account
statement, and any discrepancies in any such account statement shall be noted by
the Parties to Escrow Agent within thirty
(30) calendar days after receipt thereof. Failure to inform Escrow
Agent in writing of any discrepancies in any such account statement within said thirty
(30) day period shall conclusively be deemed confirmation of such account
statement in its entirety.
3
(c) The Escrow Agent shall not vote the
Escrow Shares unless and until it receives written notice signed by the
Representatives and Purchaser directing the vote of the Escrow
Shares.
(d) During the term of this Escrow
Agreement, any moneys in
the Escrow Fund shall be
invested in a JPMorgan Chase Bank, N.A. money market deposit account (“MMDA”) or
a successor or similar investment offered by the Escrow Agent, unless otherwise
instructed in writing by the Parties and as shall be reasonably acceptable to the Escrow Agent. The
Escrow Agent will provide compensation on balances in the Escrow Fund at the then-applicable rate for such
account or investment from
time to time. Written investment instructions, if any, shall specify
the type and identity of the investments to be purchased and/or
sold. The Escrow Agent is hereby authorized to execute purchases and
sales of investments through the 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 reasonable compensation with respect to any
investment directed hereunder including without limitation charging a reasonable agency fee in connection with each
transaction. The Parties recognize and agree that the Escrow Agent
will not provide supervision, recommendations or advice relating to either the
investment of moneys held in the Escrow Fund or the purchase, sale, retention or
other disposition of any investment described herein. The Escrow Agent shall not
have any liability for any loss sustained as a result of any investment in an
investment made pursuant to the terms of this Escrow Agreement or as a result of
any liquidation of any investment prior to its maturity or for the failure of
the Parties to give the Escrow Agent instructions to invest or reinvest the Escrow
Fund.
4. Disbursement of
Escrow Funds. The Parties agree that the
Escrow Fund is available to satisfy the Purchaser’s right to indemnification as
set forth in Article VII of the Merger Agreement. On the Claims
Deadline (as defined below), the Escrow Agent shall release all of the Escrow
Fund to Representatives, less any amounts as to which Purchaser has asserted a
notice seeking indemnification (a “Claim
Notice”) and any other
amounts released in accordance with Section 5 hereof
5.
Claims.
(a) If
Purchaser wishes to make a claim hereunder for indemnification pursuant to
Article VII of the Merger Agreement, it shall promptly deliver a Claim Notice
(as defined below) to the Representatives and the Escrow Agent. The
Claim Notice shall state (i) the dollar amount of any indemnification asserted
to be owed under Article VII of the Merger Agreement, (ii) the number of Escrow
Shares that Purchaser asserts are necessary to satisfy the indemnification
amount owed, (iii) a statement of the facts giving rise to such claim for
indemnification, and (iv) that a claim for such indemnification has been made in
accordance with the terms of the Merger Agreement (including, but not limited
to, Section 1.11 and Article VII thereof).
(b) On
the sixteenth (16th)
business day following receipt by the Escrow Agent of the Claim Notice, the
Escrow Agent shall release the number of Escrow Shares described in the
Claim
Notice to Purchaser from the Escrow Fund, less the amount, if any, described in
a Dispute Notice (as defined below). If the Escrow Fund contains both stock and
cash, any such payment shall be made to Purchaser in stock and cash, such that
the ratio of cash paid to stock paid is equal to the ratio of cash to stock in
the Escrow Fund as of the date of such payment. For purposes of
distributing the Escrow Fund pursuant to the terms hereof, the Escrow Shares
shall be valued at the “Parent Common Stock Per Share Issue Price” as determined
in Section 1.6(a) of the Merger Agreement.
4
(c) During
the fifteen (15) business days following the Escrow Agent’s receipt of the Claim
Notice, the Representatives shall deliver a written notice, if any, to the
Escrow Agent and the Purchaser disputing a claim made in the Claim Notice (a
“Dispute Notice”), which
such Dispute Notice shall be delivered in accordance with the terms of the
Merger Agreement and shall state with specificity the dispute and the portion of
the claim stated in the Claim Notice that is the subject of such dispute (the
“Disputed
Amount”). The Escrow Agent shall not distribute the
Disputed Amount until (i) the rights of all the Parties shall have been fully
and finally adjudicated in accordance with the terms of the Merger Agreement, or
(ii) all differences and all doubt shall have been resolved by agreement among
all of the interested persons, and the Escrow Agent shall have been notified
thereof in writing signed by all such persons. The rights of the
Escrow Agent under this Section 5(c) are cumulative of all other rights it may
have by law or otherwise. Any claim by Purchaser disputed by the Representatives
pursuant to this Section 5(b), or any claim by Purchaser which the Escrow Agent
has refused to comply with or take any action in connection with in accordance
with this Section 5(c), shall be referred to herein as a “Disputed
Claim”. The Escrow Agent shall not be liable in any way or to
any Person for its failure or refusal to release such Disputed
Amount.
(d) Promptly
following resolution of a Disputed Claim in favor of the former stockholders (as
detailed in the Merger Agreement), Purchaser shall provide written notice to the
Escrow Agent that such Disputed Claim has been discharged, and any amounts being
withheld by the Escrow Agent in respect of such Disputed Claim shall promptly be
released to the Representatives.
(e) Any
amounts to be delivered by the Escrow Agent to the Representatives from the
Escrow Fund under Section 4 hereof or this Section 5 shall, at the written
direction of the Representatives, either be delivered to the Representatives or
delivered directly by the Escrow Agent to the Exchange Agent (as defined in the
Merger Agreement) or another Person for delivery to the former holders of shares
of capital stock of XLNT as of the Effective Time (as defined in the Merger
Agreement) in accordance with the Merger Agreement.
(f) Except as expressly set forth in the
Merger Agreement, Purchaser’s failure to claim, or delay in claiming, any of the
Escrow Fund to satisfy in full any claims arising under Article VII of the
Merger Agreement, shall not be a waiver of Purchaser’s or any of the Parent
Indemnitees’ rights and remedies against Representative to recover any amounts
due Purchaser or any of the Parent Indemnitees pursuant to the Merger
Agreement.
(g) The Parties agree that Purchaser shall
have the right to make claims against the Escrow Fund on behalf of itself and
any of the other Parent Indemnitees until the earlier of (i) 90 calendar days
following the receipt by Purchasers of the signed report of
Purchasers’ independent
accounting firm with respect to the audit of Purchasers’ consolidated operations for the year
ended December 31, 2007 and (ii) the 18th month anniversary of the Closing Date
(as defined in the Merger Agreement) (the “Claims
Deadline”).
5
6. Disposition and
Termination. Upon delivery of the Escrow Fund by the Escrow Agent in accordance with Sections 4 and 5
above, this Escrow
Agreement shall terminate, subject to the provisions of Sections 9 and 10.
7. Escrow
Agent.
(a) The Escrow Agent shall have only those
duties as are specifically and expressly provided herein, which shall be deemed
purely ministerial in nature, and no other duties shall be
implied. The Escrow Agent shall neither be responsible for, nor
chargeable with, knowledge of, nor have any requirements to comply with, the
terms and conditions of any other agreement, instrument or document between the
Parties, in connection herewith, if any, including without limitation
the Merger
Agreement, nor
shall the Escrow Agent be required to determine if any person or entity has
complied with any such agreements, nor shall any additional
obligations of the Escrow Agent be inferred from the terms of such agreements,
even though reference thereto may be made in this Escrow Agreement. In the event of any conflict
between the terms and provisions of this Escrow Agreement, those of the
Merger
Agreement,
any schedule or exhibit
attached to the Escrow Agreement, or any other agreement among the
Parties, the terms and conditions of this Escrow Agreement shall
control. The Escrow Agent may rely upon and shall
not be liable for acting or refraining from acting upon any written notice,
document, instruction or request furnished to it hereunder and believed by it to
be genuine and to have been signed or presented by the proper Party or Parties
without inquiry and without requiring substantiating evidence of any
kind. The Escrow Agent shall be under no duty to inquire into or
investigate the validity, accuracy or content of any such document, notice,
instruction or request. The Escrow Agent shall have no duty to
solicit any payments which may be due it or the Escrow Fund, nor shall the Escrow Agent
have any duty or obligation to
confirm or verify the accuracy or correctness of any amounts deposited with it
hereunder. The Escrow Agent shall have no duty or obligation to make
any calculations of any kind hereunder.
(b) The Escrow Agent shall not be liable for
any action taken, suffered or omitted to be taken by it except to the extent
that a final adjudication of a court of competent jurisdiction determines that
the Escrow Agent's gross negligence or willful misconduct was the primary cause
of any loss to either Party. The Escrow Agent may
execute any of its powers and perform any of its duties hereunder directly or
through agents or attorneys, and shall be liable only for its gross negligence
or willful misconduct (as finally adjudicated in a court of competent
jurisdiction) in the selection of any such agent or attorney. The
Escrow Agent may consult with counsel, accountants and other skilled persons to
be selected and retained by it. The Escrow Agent shall not
be liable for any action taken, suffered or omitted to be taken by it in
accordance with, or in reliance upon, the advice or opinion of any such counsel,
accountants or other skilled persons. In the event that
the Escrow Agent shall be uncertain or believe there is some ambiguity as to its
duties or rights hereunder or shall receive instructions, claims or demands from
any party hereto which, in its opinion, conflict with any of the provisions of
this Escrow Agreement, it shall be entitled to refrain from taking any action
and its sole obligation shall be to keep safely all property held in escrow
until it shall be given a direction in writing by the Parties which eliminates such ambiguity or
uncertainty to the satisfaction of Escrow Agent or by a final and non-appealable
order or judgment of a court of competent jurisdiction. The Parties
agree to pursue any redress or recourse in connection with any dispute without
making the Escrow Agent a party to the same. Anything in this Escrow
Agreement to the contrary notwithstanding, in no event shall the Escrow Agent be
liable for special, incidental, punitive, 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.
6
8. Succession.
(a) The Escrow Agent may resign and be
discharged from its duties or obligations hereunder by giving thirty (30)
days advance notice in writing of
such resignation to the Parties specifying a date when such resignation shall
take effect. If the Parties have failed to appoint a successor escrow
agent prior to the expiration of thirty (30) days following receipt of the notice of
resignation, the Escrow Agent may petition any court of competent jurisdiction
for the appointment of a successor escrow agent or for other appropriate relief,
and any such resulting appointment shall be binding upon all of the parties
hereto. Escrow Agent’s sole responsibility after such thirty (30) day
notice period expires shall be to hold the Escrow Fund (without any obligation to reinvest
the same) and to deliver the same to a designated substitute escrow agent, if
any, or in accordance with the directions of a final order or judgment of a
court of competent jurisdiction, at which time of delivery Escrow Agent’s
obligations hereunder shall cease and terminate, subject to the
provisions of Sections 9 and 10 hereunder. The Escrow Agent shall have
the right to withhold an amount equal to any amount due and owing to the Escrow
Agent, plus any costs and expenses the Escrow Agent shall reasonably believe may
be incurred by the Escrow Agent in connection with the termination of the Escrow
Agreement.
(b) Any entity into which the Escrow Agent
may be merged or converted or with which it may be consolidated, or any entity
to which all or substantially all the escrow business may be transferred, shall
be the Escrow Agent under this Escrow Agreement without further
act.
9. Compensation
and Reimbursement. The Parties agree jointly
and severally to pay the Escrow Agent upon execution of this Escrow Agreement
and from time to time thereafter reasonable compensation for the services to be
rendered hereunder, which unless otherwise agreed in writing shall be as
described in Schedule 2 attached hereto, and (b) pay or reimburse the Escrow
Agent upon request for all expenses, disbursements and advances,
including, without limitation reasonable attorney's fees and
expenses, incurred or made by it in connection with the preparation,
negotiation, execution, performance, delivery, modification and termination of
this Escrow Agreement. The Parties hereby grant the Escrow Agent a lien on,
right of set-off against and security interest in, the Escrow Fund for the payment of any claim for
compensation, expenses and amounts due
hereunder. In furtherance of the foregoing, the Escrow Agent is
expressly authorized and directed, but shall not be obligated, to charge against
and withdraw from the Escrow Fund for its own account any amounts due
to the Escrow Agent under this Section 9 and is hereby expressly authorized to
sell any or all of the Escrow Shares if necessary to pay any of the foregoing
amounts. The
obligations contained in this Section 9 shall survive the termination of this
Escrow Agreement and the resignation, replacement or removal of the Escrow
Agent.
7
10. Indemnity.
The Parties shall jointly and
severally indemnify, defend and save harmless the Escrow Agent and its
affiliates and their respective successors, assigns, directors, officers,
managers, attorneys, accountants, experts, agents and employees (the
“indemnitees”) from and against any and all losses, damages, claims,
liabilities, penalties, judgments, settlements, actions, suits, proceedings,
litigation, investigations, costs or expenses (including, without limitation,
the fees and expenses of in house or outside counsel and experts and their
staffs and all expense of document location, duplication and shipment)
(collectively “Losses”) arising out of or in connection with (a) the Escrow
Agent's execution and performance of this Escrow Agreement, tax reporting or
withholding, the enforcement of any rights or remedies under or in connection
with this Escrow Agreement, or as may arise by reason of any act, omission or
error of the indemnitee, except in the case of any indemnitee to the extent that
such Losses are finally adjudicated by a court of competent jurisdiction to have
been primarily caused by the gross negligence or willful misconduct of such
indemnitee, or (b) its following any instructions or other directions, whether
joint or singular, from the Parties, except to the extent that its following any
such instruction or direction is expressly forbidden by the terms
hereof. The Parties hereto acknowledge that the foregoing indemnities
shall survive the resignation, replacement or removal of the Escrow Agent or the
termination of this Escrow Agreement. The Parties hereby grant the
Escrow Agent a lien on, right of set-off against and security interest in, the
Escrow Fund for the payment of any claim for
indemnification, expenses and amounts due hereunder. In furtherance of the foregoing, the
Escrow Agent is expressly authorized and directed, but shall not be obligated,
to charge against and withdraw from the Escrow Fund for its own account or for the
account of an indemnitee any amounts due to the Escrow Agent or to an indemnitee
under this Section 10 and
is hereby expressly authorized to sell any or all of the Escrow Shares if
necessary to pay any of the foregoing amounts. The obligations contained
in this Section 10 shall survive the termination of this
Escrow Agreement and the resignation, replacement or removal of the Escrow
Agent.
11. Patriot Act
Disclosure/Interest.
(a) Patriot Act
Disclosure. Section 326 of the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (“USA PATRIOT Act”) requires the Escrow Agent to implement
reasonable procedures to verify the identity of any person that opens a new
account with it. Accordingly, the Parties acknowledge that Section
326 of the USA PATRIOT Act and the Escrow Agent’s identity verification
procedures require the Escrow Agent to obtain information which may be used to
confirm the Parties identities including without limitation name, address and
organizational documents (“identifying information”). The Parties agree to provide the Escrow
Agent with and consent to the Escrow Agent obtaining
from third parties any such identifying information required as a condition of
opening an account with or using any service provided by the Escrow
Agent.
8
(b)
Taxpayer Identification Numbers
(“TINs”). The Parties have provided the Escrow Agent with
their respective fully executed Internal Revenue Service (“IRS”) Form W-8, or
W-9 and/or other required documentation. The Parties each represent
that its correct TIN assigned by the IRS, or any other taxing authority, is set
forth in the delivered forms, as well as in the Substitute IRS For, W-9 set
forth on the signature page of this Escrow Agreement.
(c) Interest. In the
event that any interest or other income is earned on the Escrow Fund, the
Parties hereby agree to negotiate in good faith, and execute and deliver, such
supplemental written instructions to the Escrow Agent as are necessary to
account for such interest or other income, in form satisfactory to the Escrow
Agent, which such instructions shall include (i) a schedule of allocation of
such interest or income, (ii) fully executed Internal Revenue Service Form W-8
or W-9 (including Taxpayer Identification Numbers) and/or other similar
documentation for the applicable parties, (iii) appropriate representations
reasonably required by the Escrow Agent from the Parties and/or other relevant
parties regarding allocation, tax reporting and payment of taxes, and including
reasonable exculpatory language to the benefit of the Escrow Agent relevant to
such allocation and tax reporting. 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 interest or
other income, other than to keep safely such interest or other income 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.
12. Notices and Funds Transfer
Information. All communications hereunder shall be in
writing and shall be deemed to be duly given and received:
(a) upon delivery, if delivered personally,
or upon confirmed transmittal, if by facsimile and if received by 5:00 p.m.,
local time for the
recipient, on a Business Day;
(b)
on the next Business Day (as
hereinafter defined) if sent by overnight courier;
or
(c)
four (4) Business Days after
mailing if mailed by prepaid registered mail, return receipt requested, to the
appropriate notice address
set forth below or at such other address as any party hereto may have furnished
to the other parties in writing by registered mail, return receipt
requested.
Notices made to either Purchaser or Representative pursuant to this Escrow
Agreement will be made in accordance with the information shown
below:
If to Purchaser:
Pet DRx
Corporation f/k/a Echo Healthcare
Acquisition Corp.
000
Xxxxxxxxxx Xxxxx
Xxxxx
000
Xxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Xxxx
Xxxxxx
Xxxx Xxxxxxxx
Fax No: 000-000-0000
9
If
to Representatives:
Pet DRx Corporation f/k/a XLNT Veterinary
Care, Inc.
000
Xxxxxxxxxx Xxxxx
Xxxxx
000
Xxxxxxxxx,
Xxxxxxxxx 00000
Attention: Xxxxxx
Xxxxxx
Xxxxxx Xxxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxxx
Fax No.:
000-000-0000
If
to the Escrow Agent:
JPMorgan Chase Bank,
N.A.
Escrow Services
0 Xxx Xxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X.
Xxxxx
Fax No.:
000-000-0000
Notwithstanding the above, in the case
of communications delivered to the Escrow Agent pursuant to (a), (b) and (c) of this Section 12, such communications shall be deemed to
have been given on the date received by an officer of the Escrow Agent or any
employee of the Escrow Agent who reports directly to any such officer at the
above-referenced office. In
the event that the Escrow Agent, in its sole discretion, shall determine that an
emergency exists, the Escrow Agent may use such other means of communication as
the Escrow Agent deems appropriate. “Business Day” shall mean any day
other than a Saturday, Sunday
or any other day on which the Escrow Agent located at the notice address set
forth above is authorized or required by law or executive order to remain
closed.
13. Security
Procedures. In the
event transfer instructions are given (other than in writing at the time of execution of
this Escrow Agreement, as indicated in Section 12 above), whether in writing, by
facsimile or otherwise, the Escrow Agent is authorized to seek confirmation of
such instructions by telephone call-back to the person or persons designated on schedule 1 hereto
(“Schedule 1”), and the Escrow Agent may rely upon
the confirmation of anyone purporting to be the person or persons so
designated. The persons and telephone numbers for call-backs may be
changed only in a writing actually received and acknowledged by
the Escrow Agent. If the Escrow Agent is unable to contact any of the authorized
representatives identified in Schedule 1, the Escrow Agent is hereby authorized
to suspend implementing any
such transfer instructions until an appropriate confirmation has been
obtained. The
Escrow
Agent and the beneficiary's bank in any
funds transfer may rely solely upon any account numbers or similar identifying
numbers provided by Purchaser or Representatives to identify (a) the beneficiary, (b) the beneficiary's bank, or
(c) an intermediary bank. The
Escrow Agent may apply any of the escrowed funds for any payment order it
executes using any such identifying number, even when its use may result in a
person other than the beneficiary being paid, or the transfer of funds to
a bank other than the beneficiary's bank or an intermediary bank designated. The
Parties acknowledge that these security procedures are commercially
reasonable.
14. Compliance with Court
Orders. In the event
that any of the property comprising the Escrow Fund shall be attached, garnished or levied
upon by any court order, or the delivery thereof shall be stayed or enjoined by
an order of a court, or any order, judgment or decree shall be made or entered
by any court order
affecting the property deposited under this Escrow Agreement, the Escrow Agent
is hereby expressly authorized, in its sole discretion, to obey and comply with
all writs, orders or decrees so entered or issued, which it is advised by legal
counsel of its own choosing is binding upon it,
whether with or without jurisdiction, and in the event that the Escrow Agent
obeys or complies with any such writ, order or decree it shall not be liable to
any of the parties hereto or to any other person, entity, firm or corporation, by reason of such
compliance notwithstanding such writ, order or decree be subsequently reversed,
modified, annulled, set aside or vacated.
15.
Miscellaneous. The provisions of this Escrow Agreement
may be waived, altered, amended or supplemented, in whole or in part, only
by a writing signed by the Escrow Agent and the Parties. Neither this
Escrow Agreement nor any right or interest hereunder may be assigned, in whole or in part, by the Escrow Agent or any Party, except
as provided in Section
8, without the prior consent of the
Escrow Agent and the other Parties. This Escrow Agreement
shall be governed by and construed under the laws of the State of Delaware. Each Party irrevocably waives any
objection on the grounds of venue, forum non-conveniens or any similar grounds
and irrevocably consents to service of process by mail or in any other manner
permitted by applicable law and consents to the jurisdiction of the courts
located in the State of
Delaware. The Parties further hereby
waive any right to a trial
by jury with respect to any lawsuit or judicial proceeding arising or relating
to this Escrow Agreement. No party to this Escrow Agreement is liable
to any other party for losses due to, or if it is unable to perform its
obligations under the terms of this Escrow
Agreement because of, acts of God, fire, war, terrorism, floods, strikes,
electrical outages, equipment or transmission failure, or other causes
reasonably beyond its control. This Escrow Agreement may be executed
in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument. All signatures of the parties to this Escrow Agreement may
be transmitted by facsimile, and such facsimile will, for all purposes, be deemed to be the original
signature of such party whose signature it reproduces, and will be binding upon
such party. If any provision of this Escrow
Agreement is determined to be prohibited or unenforceable by reason of any
applicable law of a
jurisdiction, then such provision shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions thereof, and any such prohibition or unenforceability in
such jurisdiction shall not invalidate or render
unenforceable such provisions in any other jurisdiction. The parties
represent, warrant and covenant that each document, notice, instruction or
request provided by such Party to Escrow Agent shall comply with
applicable laws and regulations. Where,
however, the conflicting provisions of
any such applicable law may be waived, they are hereby irrevocably waived by the
Parties to the fullest extent permitted
by law, to the end that this Escrow Agreement shall be enforced as written. Except as
expressly provided in Section 8 above, nothing in this Escrow Agreement, whether
express or implied, shall be construed to give to any person or entity other
than the Escrow Agent and the Parties any legal or equitable right,
remedy, interest or claim under or in respect of
this Escrow Agreement or any of the Escrow Shares or funds escrowed
hereunder.
10
IN WITNESS
WHEREOF, the parties hereto
have executed this Escrow Agreement as of the date set forth
above.
|
Tax Certification:
Taxpayer Identification Number (TIN): 00-0000000 Date:
February ___, 2008.
Name &
Address:
Pet DRx Corporation f/k/a Echo Healthcare Acquisition, Corp.
000
Xxxxxxxxxx Xxxxx
Xxxxx
000
Xxxxxxxxx,
Xxxxxxxxx 00000
Customer
is a (check one):
X
Corporation ___
Partnership
___
Individual/sole proprietor ___
Trust ___
Other _________________
Taxpayer
is (check if applicable):
___
Exempt from backup withholding
Under
the penalties of perjury, the undersigned certifies that:
(1) the
number shown above is its correct Taxpayer Identification Number (or it is
waiting for a number to be issued to it);
(2) it
is not subject to backup withholding because: (a) it is exempt from backup
withholding or (b) it has not been notified by the Internal Revenue
Service (IRS) that it is subject
to
backup withholding as a result of failure to report
all interest or dividends, or (c) the IRS has notified it that it is no
longer subject to backup withholding; and
(3) the
entity is a U.S. person (including a U.S. resident
alien).
Note: The IRS does not require your consent to any provision of this
document other than the certifications required to avoid backup
withholding.
|
PURCHASER:
PET DRX
CORPORATION
Signature: /s/ Xxxx
Xxxxxx
Printed Name: Xxxx Xxxxxx, as a member of the committee referred to in Section
1.11(a) of the Merger Agreement
11
REPRESENTATIVES:
Signature: /s/ Xxxxxx
Xxxxxx
Printed
Name: Xxxxxx Xxxxxx
Signature: /s/ Xxxxxxx
Xxxxxxxx
Printed
Name: Xxxxxxx
Xxxxxxxx
Signature: /s/ Xxxxxx
Xxxxxxx
Printed Name:
Xxxxxx
Xxxxxxx
JPMORGAN CHASE BANK,
NATIONAL
ASSOCIATION
as Escrow
Agent
By: /s/ Xxxxx X.
Xxxxx
Printed Name: Xxxxx X. Xxxxx
Title: Assistant Vice President
12
Schedule
1
Telephone Number(s) and authorized
signature(s) for
Person(s)
Designated to give Transfer Instructions
If to
Purchaser:
|
Name
|
Telephone
Number
|
Signature
|
|||
|
1.
|
Xxxx
Xxxxxxxx
|
_______________________
|
___________________
|
||
|
2.
|
Xxxx Xxxxxx
|
_______________________
|
___________________
|
||
|
3.
|
_______________
|
_______________________
|
___________________
|
If to Representative:
|
Name
|
Telephone
Number
|
Signature
|
|||
|
1.
|
Xxxxxx
Xxxxxx
|
_______________________
|
___________________
|
||
|
2.
|
Xxxxxx
Xxxxxxx
|
_______________________
|
___________________
|
||
|
3.
|
Xxxxxxx
Xxxxxxxx
|
_______________________
|
___________________
|
Telephone Number(s) for Call-Backs
and
Person(s)
Designated to Confirm Transfer Instructions
If to
Purchaser:
|
Name
|
Telephone
Number
|
|||
|
1.
|
Xxxx
Xxxxxxx
|
_______________________
|
||
|
2.
|
Xxxx Xxxxxx
|
_______________________
|
||
|
3.
|
_______________
|
_______________________
|
If to Representative:
|
Name
|
Telephone
Number
|
|||
|
1.
|
Xxxxxx
Xxxxxxxxx
|
_______________________
|
||
|
2.
|
_______________
|
_______________________
|
|
3.
|
_______________
|
_______________________
|
Telephone call backs shall
be made to both Parties if
joint instructions are required pursuant to the agreement. All funds transfer
instructions must include the signature of the
person(s) authorizing said funds
transfer and must not be the same person confirming said
transfer.
13
SCHEDULE 2
Escrow Agent’s Compensation:
$2,500.00
per annum with no right of proration
14
