Exhibit 10.10(i)
ESCROW AGREEMENT
THIS ESCROW AGREEMENT is entered into this 5th day of November 1997, by
and among (i) I. C. Xxxxxx & Company L.P., a Delaware limited partnership
("Buyer"); (ii) Brookhurst, Inc., a California corporation ("Seller") and
(iii) Xxxxx Xxxxxx Inc. (the "Escrow Agent").
W I T N E S S E T H :
WHEREAS, Seller and Buyer are parties to a Worldwide Rights Acquisition
Agreement dated September 30, 1997 (the "Acquisition Agreement") pursuant to
which Seller has sold to Buyer, and Buyer has purchased from Seller, subject
to the terms and conditions set forth in the Agreement, certain assets,
subject to certain liabilities, of Seller constituting the assets of the
BOSS business of Seller;
WHEREAS, Buyer and Seller wish to enter into this Escrow Agreement in
order to establish an escrow arrangement for certain funds that are being and
will be deposited with the Escrow Agent pursuant to the terms of the
Acquisition Agreement and a promissory note of even date herewith in favor of
Seller (the "Note");
WHEREAS, funds deposited with the Escrow Agent hereunder shall be
referred to as the "Escrow Fund";
WHEREAS, Buyer and Seller wish to appoint the Escrow Agent, and the
Escrow Agent has agreed to act, as a depository and administrator of the
Escrow Fund upon the terms, conditions and provisions hereinafter set forth;
and
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein and other good and valuable consideration, receipt of which
is hereby acknowledged by the Escrow Agent, it is hereby agreed among the
parties hereto as follows:
1. Appointment of the Escrow Agent
1.1 Buyer and Seller hereby designate the Escrow Agent, and the Escrow
Agent hereby agrees to act, as a depository and administrator of the Escrow
Fund, subject to the terms and conditions set forth herein.
1.2 The Escrow Agent's duties and responsibilities, in its capacity as
such, shall be limited to those expressly set forth in this Escrow Agreement,
and the Escrow Agent shall not be subject to, nor obligated to recognize, any
other agreement between any or all of the parties hereto even though
reference thereto may be made herein, except to the extent that definitions
contained in the Acquisition Agreement are incorporated into this Escrow
Agreement. This Escrow Agreement may not be amended at any time in such a
way as to affect the rights, responsibilities, obligations, liabilities or
fees of the Escrow Agent except with the Escrow Agent's prior written
consent, as evidenced by an instrument in writing signed by all the parties
hereto.
1.3 The Escrow Agent, in its capacity as such, is authorized, in its
sole discretion, to disregard any and all notices or directions given by
Buyer or Seller or by any other person, firm or corporation, except (i) such
notices, directions, instructions as are specifically provided for herein,
(ii) joint written instructions received by the Escrow Agent from Buyer and
Seller and (iii) a Final Order (as hereinafter defined). If any property
subject hereto is at any time attached, garnished or levied upon under a
Final Order, or in case the payment, assignment, transfer, conveyance or
delivery of any such property shall be stayed or enjoined by the Final Order,
or in case the Final Order shall be made or entered affecting such property
or any part thereof, then and in any of such events the Escrow Agent is
authorized to rely upon and comply with any such Final Order which the Escrow
Agent is advised by competent and experienced legal counsel of its own
choosing, or by legal counsel selected by mutual consent of Seller and Buyer,
is not subject to further review or appeal and is binding upon the Escrow
Agent for purposes hereof . The term "Final Order" as used herein shall mean
a final judgment, order or award of a court of competent jurisdiction or
arbitrator, as evidenced by a certified copy of such judgment, order or
award, as certified by such court or arbitrator, as the case may be, provided
that such judgment, order or award is not appealable or the time for taking
an appeal has expired, or in the case of an arbitral award, payment is not
stayed by a court of competent jurisdiction.
1.4 (a) In the event that the Escrow Agent shall be uncertain as to its
duties or actions hereunder, or shall receive instructions from Buyer or
Seller which, in the opinion of the Escrow Agent, are in conflict with any of
the provisions of this Agreement, it shall be entitled to maintain the Escrow
Fund and may decline to take any further action until the Escrow Agent
receives joint written instructions from Buyer and Seller (or a Final Order)
directing the disbursement of all or any portion of such Escrow Fund, in
which case the Escrow Agent shall then make such disbursement in accordance
with such instructions (or Final Order). Should any dispute arise with
respect to the payment or ownership or right of possession of any proposed
disbursement, the Escrow Agent is authorized and directed to retain in its
possession, without liability to anyone, all or any part of the amount of
such proposed disbursement until such dispute shall have been settled either
by mutual agreement of the parties concerned or by a Final Order, provided
that the Escrow Agent shall be under no duty whatsoever to institute or
defend any such proceedings, and, provided further, that if any such dispute
continues for more than 120 days, the Escrow Agent may, in its discretion,
upon written notice to Buyer and Seller
interplead the Escrow Fund (or that portion thereof which is the subject of such
dispute) to a court of competent jurisdiction (subject to the provisions of
Section 6.4(b) hereof).
(b) Notwithstanding the foregoing, the interpleader by the Escrow
Agent of any sum to a court of competent jurisdiction (the "Interpleader
Action") shall in no way operate to alter or affect the parties' obligations
to arbitrate any dispute pursuant to paragraph 6.4(b) of this Agreement. In
furtherance of the parties' obligations to arbitrate any dispute arising
hereunder the parties agree to execute any reasonably necessary document,
including but not limited to any stipulation, stipulated order and/or
stipulation of discontinuance, to cause any sum interpleaded to a court of
competent jurisdiction by the Escrow Agent to be transferred to an account
under the control of the arbitrator(s) selected pursuant to paragraph 6.4(b)
of this Agreement and to have the Interpleader Action dismissed.
Thereafter, the dispute related to the interpleaded funds shall be resolved
in arbitration pursuant to paragraph 6.4(b) of the Agreement.
1.5 (a) It is understood and agreed that the Escrow Agent shall:
(i) be under no duty to accept notices or instructions from any
person other than as expressly provided for in this Escrow Agreement;
(ii) be protected in acting upon any notice, opinion, request,
certificate, approval, consent or other document reasonably believed by it
to be genuine and what it purports to be;
(iii)be deemed conclusively to have given and delivered any
notice required to be given or delivered hereunder if the same is in
writing, signed by any one of its authorized officers and (A) mailed, by
registered or certified mail, return receipt requested, postage prepaid,
(B) sent via expedited courier service that regularly requires signed
receipts evidencing delivery, or (C) hand delivered, in a sealed wrapper,
manually receipted for by the addressee, in each case to Buyer or Seller
with a copy to the other party to this Agreement at the addresses set
forth in Section 6.3 hereof;
(iv) be indemnified and held harmless jointly by Buyer and
Seller from and against any claim made against it by reason of its acting
or failing to act in connection with any of the transactions contemplated
hereby and against any loss, liability or expense, including reasonable
attorneys' fees and other reasonable expenses of defending itself against
any claim of liability it may sustain in carrying out the terms of this
Escrow Agreement, except for claims which are successfully asserted
against the Escrow Agent based upon the Escrow Agent's failure to comply
with the terms and conditions of this Escrow Agreement or the bad faith,
gross negligence or willful misconduct of the Escrow Agent; provided
however, that (A) promptly after the receipt by the Escrow Agent of
notice of any demand or claim or the commencement of any such action,
suit or proceeding, the Escrow Agent shall notify all parties hereto in
writing of the existence of such demand, claim, action, suit or
proceeding; (B) the
indemnitor shall be entitled, at its own expense, to participate in
and assume the defense of any such action, suit or proceeding; and (C)
the aforesaid indemnity obligations shall survive the termination of
this Escrow Agreement or the resignation of the Escrow Agent;
(v) have no liability in respect of or duty to inquire into
the terms and conditions of the Acquisition Agreement or any other
document or agreement executed in connection with or pursuant to the
Acquisition Agreement, its duties under this Escrow Agreement being
understood by the parties to be ministerial in nature;
(vi) be permitted to consult with counsel of its choice which
is reasonably experienced in legal matters of a nature similar to those
arising under this Escrow Agreement, and shall not be liable for any
action taken, suffered or omitted by it in good faith in accordance with
the advice of such counsel; provided, however, that nothing contained in
this subsection (vi), nor any action taken by the Escrow Agent or by such
counsel, shall relieve the Escrow Agent from liability for any claims
which are occasioned by its failure to comply with the terms and
conditions of this Escrow Agreement or the bad faith, gross negligence or
willful misconduct of the Escrow Agent, as provided in subparagraph (iv)
above;
(vii) not be bound by any modification, amendment, termination,
cancellation, rescission or supersession of this Escrow Agreement, unless
the same shall be in writing and signed by both Buyer and Seller and
notice thereof is provided to the Escrow Agent, except to the extent that
any such modification, amendment, termination, cancellation, rescission
or supersession affects the rights, responsibilities, obligations,
liabilities or fees of the Escrow Agent hereunder, in which case any
document or instrument reflecting such changes shall also be signed by
the Escrow Agent;
(viii) be entitled to refrain from taking any action other than
to keep all cash and other payments and all other property held by it in
escrow and to make the investments as herein provided until it shall be
directed otherwise in writing by Buyer and Seller, or as otherwise
provided herein or by a Final Order; and
(ix) not have any interest in the Escrow Fund, other than
possession thereof in its capacity as escrow agent hereunder.
(b) Any payments of interest or income from the Escrow Fund shall
be subject to withholding regulations then in force with respect to federal,
state and local taxes. The parties will provide the Escrow Agent with
appropriate W-9 forms for taxpayer identification number certifications. It
is understood that the Escrow Agent shall be responsible for income reporting
only with respect to income earned on investment of funds which are part of
the Escrow Fund and shall not be responsible for any other reporting. This
paragraph shall survive
notwithstanding any termination of this Escrow Agreement or the resignation
of the Escrow Agent.
(c) Notwithstanding anything to the contrary herein, unless and
until funds are deposited with the Escrow Agent pursuant to Section 2.1, the
Escrow Agent shall not have any liability or responsibility whatsoever to
Buyer or Seller or any other person under this Escrow Agreement, except for
its failure or refusal to accept delivery of any funds deposited in escrow
with the Escrow Agent in the manner specified in Section 2.1 or to hold such
funds thereafter pursuant to the terms hereof.
1.6 From and after the date hereof, Buyer and Seller shall deliver or
cause to be delivered to the Escrow Agent such further documents and
instruments, or cause to be done such further acts, as the Escrow Agent may
reasonably request in order to enable the Escrow Agent to carry out more
effectively the provisions and purposes of this Escrow Agreement, to evidence
compliance with this Escrow Agreement or to assure itself that it is
reasonably protected in acting under this Escrow Agreement.
1.7 (a) For its services hereunder, the Escrow Agent shall be entitled
to be paid an annual fee in the amount specified in Exhibit A, payable in
advance. The Escrow Agent hereby acknowledges receipt from Buyer and Seller
of the fee for the first annual period hereunder. Payment of the relevant
fee for all subsequent annual periods shall be due on each anniversary of
the date hereof.
(b) All fees of the Escrow Agent hereunder shall be paid by Buyer
and Seller, such parties sharing equally in such costs.
2. Establishment of Escrow Fund
2.1 The parties acknowledge and agree that $5,625,000 has been deposited
with the Escrow Agent as of the date hereof and from time to time further
funds will be deposited with the Escrow Agent. The parties further agree
that subject to the provisions of paragraph 3.2(e), one-half (1/2) of all
principal and interest payments due under paragraph 2 of the Note shall be
transmitted by the maker thereunder to the Escrow Agent for deposit in the
Escrow Fund. Under no circumstances shall Seller be obligated to deposit any
funds in the Escrow Fund beyond the amounts set forth in this Section 2.1
which are deposited by the maker with the Escrow Agent.
2.2 The Escrow Fund shall be held by the Escrow Agent in a separate
account and disbursed to Buyer or Seller in accordance with the terms of this
Agreement.
2.3 The Escrow Agent shall invest all funds on deposit from time to time
in the Escrow Fund, and all undistributed income earned thereon, and keep the
same invested in certain instruments as Seller shall from time to time direct
the Escrow Agent in writing, subject to the restrictions and limitations
hereinafter provided, and disburse the same
terms, conditions and provisions hereof. The Escrow Agent shall invest the
Escrow Fund solely in accordance with Seller's instructions, provided that
Seller's instructions and the Escrow Agent's authority shall be restricted
to: (i) obligations issued or unconditionally guaranteed by the Government of
the United States of America or any State or political subdivision thereof;
(ii) certificates of deposit and interest-bearing deposit accounts of any
domestic bank or trust company which has a combined capital and surplus of at
least $200,000,000; (iii) certificates of deposit with a maturity not to
exceed one year or (iv) commercial paper with a maturity of no more than one
year issued by any corporation organized and existing under the laws of the
United States of America or any state thereof, which at the time of purchase
has been rated, and the ratings for which are not less than, "A-1" if rated
by Standard and Poor's Corporation or "P-1" if rated by Xxxxx'x Investors
Services, Inc. In no event shall the Escrow Agent invest the Escrow Fund or
any undistributed income earned thereon in any security or instrument having
a maturity extending beyond one year, provided, that such limitation shall
not apply to the obligations described in clause (i) above. The Escrow Agent
shall have authority to invest daily cash receipts received by the Escrow
Fund in the Xxxxx Xxxxxx Money Market Fund, or equivalent brokerage house
money market fund pending investment of such funds in accordance with the
provisions of this Section 2.3.
3. Disposition of Escrow Fund
3.1 All funds on deposit from time to time in the Escrow Fund shall be
held, invested and reinvested by the Escrow Agent pursuant to the terms of
this Escrow Agreement until the funds therein shall be disbursed in
accordance with the terms of this Escrow Agreement.
3.2 The Escrow Agent shall make disbursement of funds on deposit in the
Escrow Fund only as set forth in this Section 3.2.
(a) Buyer shall promptly provide Seller and the Escrow Agent with a
copy of all Buyer Indemnity Claims submitted by Buyer pursuant to Section 8.2
of the Acquisition Agreement, whether such Buyer Indemnity Claims are issued
before or after any funds are deposited into escrow hereunder.
(b) Promptly following its receipt of notice of any Buyer Indemnity
Claims, and without any further duty of investigation or inquiry on its part,
the Escrow Agent shall establish a reserve (a "Reserve") in the Escrow Fund,
which in all events shall be equal to the full amount of each claim
identified in such notice (which shall include, without limitation, Buyer's
good faith estimate of the costs and expenses reasonably expected to be
incurred by Buyer in investigating and disposing of any such claim). Subject
to Sections 9.12(b) and (c) of the Acquisition Agreement concerning release
of funds from the Escrow Fund following expedited arbitration, the Escrow
Agent shall not be authorized to release any funds from the Escrow Fund as to
which a Reserve has been established pursuant to this Section 3.2(b) unless
and until the relevant Buyer Indemnity Claim that gave rise to such Reserve
has been Definitively Resolved and the Escrow Agent has received written
notice of such resolution pursuant to the requirements of Section 3.2(c)
below. Until they are Definitively Resolved in
the manner hereinafter provided, all unresolved Buyer Indemnity Claims shall
be referred to herein as "Pending Claims."
(c) For purposes hereof, a Pending Claim shall be deemed to have
been "Definitively Resolved" when any of the following events has occurred:
(i) a claim is settled by mutual written agreement of Buyer and Seller; or
(ii) a Final Order deciding such claim has been rendered; or
(iii) ninety (90) days have elapsed since Seller's initial receipt of
notice of a Buyer Indemnity Claim ("First Notice") and neither
Buyer nor Escrow Agent has received, on or before that date, a
written notice from Seller disputing such claim in whole or in
part, and Buyer has provided a further notice ("Second Notice")
sent to Seller by registered or certified mail to the effect that
Seller has not disputed such claim and that Buyer intends to submit
a Settlement Notice (as hereinafter defined) and Seller has not
within thirty (30) days after receipt of such Second Notice
disputed in writing the Buyer Indemnity Claim by written notice to
Buyer or Escrow Agent.
The Escrow Agent shall not be deemed to have received notice that a Pending
Claim has been Definitively Resolved, and shall not be obligated to take any
action with respect thereto, until 10 days after the Escrow Agent shall have
received one of the following (a "Settlement Notice"): (A) with respect to
subparagraph (i) above, a copy of joint written instructions duly signed by
Buyer and Seller stating that a Pending Claim has been settled by mutual
agreement of Buyer and Seller; (B) with respect to subparagraph (ii) above, a
certified copy of the final arbitration award which has not been stayed by a
court of competent jurisdiction within 30 days thereafter, or the final
non-appealable judgment, order or award of the relevant court, together with
a certificate duly signed by the prevailing party in such proceeding
certifying that such judgement, order or award is final and non-appealable
for all purposes hereof; and (C) with respect to subparagraph (iii) above,
written certification from Buyer issued to the Escrow Agent in good faith to
the effect that Buyer has provided the First Notice and the Second Notice as
described in subparagraph (iii) above without having received a written
dispute notice from Seller, as provided above. Each Settlement Notice shall
stipulate the amount(s) to be paid to Buyer or Seller in connection with
such Definitively Resolved claim, and copies thereof shall be provided to
each of the parties hereunder at the same time it is provided to the Escrow
Agent. Buyer and Seller hereby acknowledge and agree that the Escrow Agent
shall have the right to rely upon any Settlement Notice duly given jointly by
Buyer and Seller under (A) in the preceding sentence, by Buyer or Seller
under (B) in the preceding sentence and by Buyer under (C) in the preceding
sentence, and shall be authorized to act upon any such written notice.
(d) A Buyer Indemnity Claim that has been Definitively Resolved
shall be referred to herein as a "Settled Claim". To the extent that a
Settled Claim has been resolved in favor of Buyer, the Escrow Agent shall
promptly disburse the full amount (or the relevant
portion, as applicable) of such claim to Buyer (or such other person as Buyer
may direct) from the Escrow Fund (to the extent of funds in the Escrow Fund)
in accordance with the relevant Settlement Notice. Following such payment,
all Reserves that relate to such Buyer Indemnity Claim and are not due Buyer
in accordance with the terms of the Settlement Notice shall be released, but
the funds subject thereto shall remain in the Escrow Fund until otherwise
disbursed in accordance with the terms hereof.
(e) On November 30, 1999, the excess of the outstanding principal
amount of the Escrow Fund over $10,050,000, as such excess amount is further
reduced by the aggregate amount of all outstanding Reserves, shall be
disbursed by the Escrow Agent to Seller on five (5) days' prior written
notice to Buyer. On November 30, 2000, the excess of the outstanding
principal amount of the Escrow Fund over $8,250,000, as such excess amount is
further reduced by the aggregate amount of all outstanding Reserves, shall be
disbursed by the Escrow Agent to Seller on five (5) days' prior written
notice to Buyer. On November 30, 2001, the excess of the outstanding
principal amount of the Escrow Fund over $4,750,000, as such amount is
further reduced by the aggregate amount of all outstanding Reserves, shall be
disbursed by the Escrow Agent to Seller on five (5) days' prior written
notice to Buyer. On November 30, 2002, the excess of the outstanding
principal amount of the Escrow Fund over the aggregate amount of all
outstanding Reserves, shall be disbursed by the Escrow Agent to Seller on
five (5) days' prior written notice to Buyer.
(f) Subject to paragraph (e) above, all funds deposited with the
Escrow Agent shall continue to be held in escrow hereunder until November 30,
2002, on which date the balance of the Escrow Fund, net of any Reserves,
shall be distributed to Seller. Any amounts remaining with the Escrow Agent
thereafter shall be released from time to time as and when all remaining
Pending Claims to which such funds relate have been Definitively Resolved.
The Escrow Agent shall promptly disburse to Buyer the full amount of each
Settled Claim resolved in favor of Buyer in accordance with the relevant
Settlement Notice and any funds in the Escrow Fund in excess of remaining
Reserves shall be distributed to Seller. Notwithstanding the foregoing, all
funds deposited with the Escrow Agent shall be distributed to Buyer and/or
Seller in accordance with any joint written instructions of Buyer and Seller.
(g) The Escrow Agent shall provide written notice of any proposed
distributions of funds to Buyer or Seller hereunder five (5) days before
making any such disbursement. For purposes of such five (5)-day notice
period, such period shall commence on the date on which the relevant notice
is given by the Escrow Agent to Buyer and Seller and shall terminate at
midnight on the fifth business day thereafter. The Escrow Agent shall also
send copies of all notices it receives hereunder to the other parties hereto.
3.3 The party or parties receiving a disbursement from the Escrow Fund
shall, upon request, furnish to the Escrow Agent concurrently with its
receipt of such disbursement, a signed receipt for the amount of such
disbursement.
4. Disposition of Income
All income earned from time to time by the Escrow Fund ("Income") shall
be pooled with all other funds held in the Escrow Fund for investment
purposes and shall become part of the Escrow Fund for all purposes, provided
that on December 31 of each calendar year or any other date mutually
agreeable to Buyer, Seller and the Escrow Agent, Escrow Agent shall disburse
to Seller 35% of all accrued Income (net of losses or any other expenses)
unless such Income amounts are subject to a Reserve, Pending Claim or Settled
Claim. Any losses realized upon any investment of the Escrow Fund pursuant
to Section 2.3 or otherwise shall be charged to the Escrow Fund.
5. Term
5.1 The term of this Escrow Agreement shall commence on the date hereof
and continue until the entire amount of principal and Income on deposit in
the Escrow Fund shall have been disbursed by the Escrow Agent as provided in
this Escrow Agreement, whereupon this Escrow Agreement and the escrow
arrangements created hereunder shall terminate, and the Escrow Agent shall be
released and discharged from all further duties and obligations hereunder,
but without prejudice to any liability of the Escrow Agent for its failure to
comply with the terms and conditions of this Escrow Agreement or its bad
faith, gross negligence or willful misconduct hereunder.
5.2 The Escrow Agent shall have the right, upon termination of this
Escrow Agreement as hereinabove provided, to require the other parties
hereto, as a condition to receiving a final disbursement from the Escrow
Fund, if applicable, to execute, acknowledge and deliver to the Escrow Agent
releases of the Escrow Agent, in its capacity as such, reasonably
satisfactory to the Escrow Agent in form and content; provided, however, that
the Escrow Agent shall have accounted to each party delivering such release
with respect to the Escrow Agent's administration of the Escrow Fund and
provided further that any such release shall not extend to any acts of bad
faith, gross negligence or willful misconduct on its part in connection with
the Escrow Agent's administration of the Escrow Fund.
6. Miscellaneous
6.1 (a) Buyer and Seller may, upon at least 30 days' prior written
notice to the Escrow Agent executed by each of them, dismiss the Escrow Agent
hereunder and jointly appoint a successor. In such event, the Escrow Agent
shall promptly account for and deliver to the successor escrow agent named in
such notice the then balance of the Escrow Fund, if any, including all
investments thereof and accrued income thereon. Upon acceptance thereof and
of such accounting by such successor escrow agent, and upon reimbursement to
the Escrow Agent by Buyer and Seller of all expenses due to it hereunder
through the date of such accounting and delivery, the Escrow Agent, in its
capacity as such, shall be released and discharged from all of its duties and
obligations hereunder, but without prejudice to any liability of the Escrow
Agent for failure to comply with the terms and conditions of this Escrow
Agreement or its bad faith, gross negligence or willful misconduct hereunder.
(b) (i) Without limiting the foregoing, the Escrow Agent (and any
successor escrow agent hereunder) shall have the right, as provided in (ii)
below, at any time to resign as such by delivering the Escrow Fund to any
successor escrow agent jointly designated by the other parties hereto in
writing , or to any escrow agent which constitutes a national banking
association with assets in excess of $500,000,000 who is willing to
serve under this Agreement], or to any court of competent jurisdiction,
[or to an account under the control of the arbitrator(s) selected pursuant to
paragraph 9.12 of the Acquisition Agreement, whereupon the Escrow Agent shall be
discharged of and from any and all further obligations arising in connection
with this Escrow Agreement, but without prejudice to any liability of the
Escrow Agent for its bad faith, gross negligence or willful misconduct
hereunder.
(ii) The resignation of the Escrow Agent will take effect on the
earlier of (a) the appointment of a successor escrow agent (including a
court of competent jurisdiction) or (b) the day which is 30 business days
after the date of delivery of its written notice of resignation to the
other parties hereto. If at that time the Escrow Agent has not received a
designation of a successor escrow agent hereunder, the Escrow Agent's sole
responsibility after that time shall be to safekeep the Escrow Fund until
receipt of a designation of successor escrow agent hereunder or a joint
written disposition instruction by the other parties hereto or a final
order.
6.2 This Escrow Agreement shall inure to the benefit of, and shall be
binding upon, the parties hereto and their respective successors, heirs,
remaindermen, assigns, executors, administrators, personal representatives,
trustees and fiduciaries. The Escrow Agent shall have the right to rely upon
any proper evidence of the authority of any such successors, heirs,
remaindermen, assigns, executors, administrators, personal representatives,
trustees and fiduciaries. Notwithstanding anything to the contrary herein
contained, no beneficial interest of any person in the Escrow Fund shall be
subject to anticipation or assignment by such person, nor shall the Escrow
Fund be subject to interference or control of any creditor of such person, or
be taken or reached by any legal or equitable process in satisfaction of any
debt or other liability of such person prior to disbursement, and each party
hereby agrees to indemnify the other parties in connection with any loss or
diminution of such party's interest in the Escrow Fund as a result of any
such matter.
6.3 Any notice, direction, instruction or other communications required
or permitted hereunder shall be given or made in writing and shall be (i)
delivered personally (including commercial carrier), (ii) sent by registered
or certified airmail, return receipt requested, postage prepaid or (iii) sent
by telecopier, addressed to the party to whom they are directed at the
following addresses, or at such other address as may from time to time be
designated by such party to the others in accordance with this Section 6.3:
If to Buyer, to:
I. C. Xxxxxx & Company L.P.
0000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: President and Co-Chief Executive Officer
Telecopier: 410/558-2096
I. C. Xxxxxx & Company L.P.
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chairman and Co-Chief Executive Officer
Telecopier: 212/695-7579
With a copy to:
Piper & Marbury L.L.P.
Xxxxxxx Center South
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier: 410/576-1604
If to Seller, to:
Brookhurst, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxx
Telecopier: 310/763-3846
With a copy to:
Shereff, Friedman, Xxxxxxx & Xxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Telecopier: 212/758-9526
If to the Escrow Agent, to:
Xxxxx Xxxxxx Inc.
000 Xxxxx Xxxxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx
Telecopier: 213/972-1539
Copies of any written communications sent by Buyer or Seller to the
Escrow Agent relating to this Escrow Agreement shall be sent to the other
parties hereto, and copies of any written communications sent by the Escrow
Agent relating to this Escrow Agreement shall be sent to Buyer and Seller.
Notwithstanding the foregoing, Buyer and Seller shall have the right to
engage in direct written communications between themselves relating to this
Escrow Agreement without providing copies thereof to the Escrow Agent, except
to the extent otherwise required under the terms of this Escrow Agreement.
All notices, directions, instructions and communications hereunder shall
be effective, and deemed given, if and when delivered, on and as of the date
of receipt thereof, as evidenced by a written receipt by or on behalf of the
party to which the same is so delivered, and, if mailed or sent by expedited
courier, on and as of the date of delivery, as evidenced by the
acknowledgement of delivery issued with respect thereto by the applicable
postal authorities or by the confirmation of delivery issued by the
applicable courier service. Any party may change its address for notices
hereunder, effective upon giving of notice of such change hereunder to the
other parties.
6.4 (a) The validity, construction, operation, and effect of any and
all of the terms and provisions of this Agreement shall be determined and
enforced in accordance with the laws of the State of New York, without giving
effect to principles of conflicts of law thereunder, except as to matters
solely involving foreign trademark rights, in which case the applicable
foreign trademark laws shall be applied to determine such foreign trademark
rights. In the event any legal action becomes necessary to enforce or
interpret the terms of this Agreement, the parties agree that such action
will be brought in the U.S. District Court for the Southern District of New
York, and the parties hereby submit to the jurisdiction of such court;
provided, however, that any party may enforce an arbitration award in any
court of competent jurisdiction located in New York City and the parties
hereby submit to the jurisdiction of any such court.
(b) Notwithstanding Section 6.4(a) above, except as provided in
this Section 6.4(b), all disputes arising from or in any way in connection
with this Agreement shall be finally settled through binding arbitration
conducted pursuant to the Rules of Conciliation and Arbitration of the
International Chamber of Commerce in effect as of the date of the initiation
of any dispute submitted to arbitration under this section ("ICC Rules") by
three arbitrators appointed in accordance with the ICC Rules. Except as
provided in this Section, no modification or amendment of the ICC Rules
applicable to any such arbitration shall be binding upon the parties unless
agreed to in writing by the parties. In each such arbitration, each party to
the dispute
shall appoint one arbitrator within 30 days of receipt by the defendant of
the request for arbitration, and the arbitrators so appointed by the parties
shall appoint the third arbitrator (who shall be the Chairman), within 30
days of the confirmation of the later of the two arbitrators appointed by the
parties. If any such arbitration involves multiple claimants or multiple
defendants, nomination of arbitrator shall be governed by the applicable ICC
rules. Notwithstanding anything to the contrary contained in the ICC rules:
(i) the arbitration proceedings shall be conducted in the City of New York,
State of New York; (ii) the arbitration proceedings shall be conducted in the
English language; and (iii) the arbitrators shall apply New York law without
regard to such state's choice of law rules except as to matters involving
issues of foreign trademark law, in which case the applicable foreign
trademark laws shall be applied. If the non-prevailing party does not comply
with an arbitration decision, the prevailing parties may immediately enforce
the arbitration decision in an equitable proceeding in court with both
parties' court costs and related attorneys' fees paid by the non-prevailing
party in the arbitration, unless the arbitration decision is modified, or not
upheld or enforced, in which case, each side shall bear its own costs and
attorneys' fees.
6.5 This Escrow Agreement, and any notice, direction or other document
or instrument delivered in connection herewith, may be executed in
counterparts, each of which shall constitute an original instrument, but all
of which together shall constitute a single agreement, notice, direction,
document or instrument as the case may be. Buyer and Seller agree to
cooperate with each other in good faith in joining in any notices or written
instructions that are required to be delivered to the Escrow Agent jointly by
Buyer and Seller.
6.6 The provisions of this Escrow Agreement shall not be altered or
terminated by operation of law or by the occurrence of any event (except as
otherwise specified herein), including, without limitation, the death or
incapacity or the termination of the legal existence of any party hereto.
6.7 No party hereto may assign any of its interests, rights or
obligations under this Agreement without the prior written consent of the
other parties. Notwithstanding the foregoing, Buyer may, without the consent
of Seller, assign rights and obligations under this Agreement to any entity
under common control with Buyer or to any successor-in-interest, in whole or
in part, to the assets acquired by Buyer from Seller, and Seller may assign
its rights and obligations to any successor-in-interest to the assets of
Seller by merger or liquidation. In addition, Seller may direct in writing
to Escrow Agent (with a copy sent to Buyer) that proceeds of the Escrow Fund
be paid to any third party Seller shall designate in writing. Nothing in
this Agreement shall be construed as requiring Seller's or the Escrow Agent's
consent to (a) the assignment, in whole or in part, of ICI's (as hereinafter
defined) rights under this Agreement (including the right to make claims
against and obtain proceeds from the Escrow Fund) to Ambra Inc., any
affiliate of Hugo Boss AG ("Ambra"), or (b) the assumption, in whole or in
part, of ICI's obligations under this Agreement by Ambra. In the event of
such assignment and/or assumption, Ambra shall be recognized as "Buyer" for
purposes of all claims submitted by Ambra as Buyer pursuant to Section 3,
including, without limitation, for purposes of
distribution of funds pursuant to Settled Claims resulting therefrom.
Nothing in this Agreement shall be construed as affecting Buyer's rights
under Section 6.10.
6.8 All monetary amounts stated herein or determined hereunder are and
shall be denominated in United States dollars, and all liabilities and
obligations of any party hereunder, to the extent calling for the payment of
money, shall be satisfied in United States dollars.
IN WITNESS WHEREOF, the parties have executed this Escrow Agreement as of
the day and year first above written.
I. C. XXXXXX & COMPANY L.P., a Delaware
limited partnership
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chairman and Co-Chief Executive
Officer
By: /s/ Xxxxxx X. Xxxx
------------------------------------
Name: Xxxxxx X. Xxxx
Title: President and Co-Chief Executive
Officer
BROOKHURST, INC.
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Title: President
Xxxxx Xxxxxx Inc.
-----------------------------,
as Escrow Agent
By: /s/ Illegible
Name: Illegible
Title: Branch Manager
