SELLERS' ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement") is executed this 16th day of
January, 1997, by and among Mako Marine International, Inc., a Florida
corporation ("Seller"), Credit America Venture Capital, Inc., a Florida
corporation ("CAVC"), Tracker Marine, L.P., a Missouri limited partnership
("Purchaser"), and SunTrust Bank, Miami N.A., a national banking association
("Agent"). (All initially capitalized terms utilized herein, unless specifically
otherwise defined herein, shall have the meaning assigned to such terms in the
"Letter Agreement," as defined below).
W I T N E S S E T H:
WHEREAS, pursuant to Stock Purchase Agreements each dated December 4,
1996, by and between Purchaser and Seller and Purchaser and CAVC, respectively,
Purchaser is acquiring certain shares of Common Stock of Seller; and
WHEREAS, Purchaser, Seller and CAVC are concurrently herewith entering
into a Letter Agreement ("Letter Agreement") dated the date hereof with respect
to the matters contained herein; and
WHEREAS, pursuant to the Letter Agreement, CAVC has agreed to place
$1,310,000 in an escrow account (the "Escrow Account"), as hereinafter described
as security for certain obligations of CAVC under the Letter Agreement.
NOW, THEREFORE, in consideration of the mutual promises herein
contained and intending to be legally bound, the parties hereto agree as
follows:
1. Purpose of the Escrow Account. The Escrow Account is being
established to provide funds to satisfy claims against CAVC pursuant to the
Letter Agreement.
2. Appointment of Agent. Each of Purchaser, Seller and CAVC hereby
appoints the Agent as escrow agent in accordance with the terms and conditions
set forth herein, and Agent hereby accepts such appointment.
3. Delivery of Escrow Account to Agent. Upon execution hereof, there
will be deposited with Agent on behalf of CAVC the sum of $1,310,000 (the
"Escrow Deposit").
4. Maintenance of the Escrow Account. Agent shall maintain the Escrow
Deposit in the Escrow Account. The Escrow Account shall be a special purpose
segregated escrow account maintained in the name of the Agent, as escrow agent
under this Agreement. During the term of this Agreement, Agent agrees to hold
the Escrow Deposit and accumulated income thereon in the Escrow Account in
escrow, to invest the Escrow Deposit in Permitted Investments as directed by
CAVC and to disburse amounts in the Escrow Account (including any income on the
Escrow Deposit) in accordance with the terms of this Agreement. As used herein,
the term "Permitted Investments" shall mean (a) obligations issued by, or the
principal of interest of which is fully guaranteed by, the United States of
America or any agency or instrumentality thereof; (b) commercial paper rated A-1
or A-1+ by Standard & Poors or P-1 by Moody's; (c) obligations issued by, or the
principal of and interest on which is fully guaranteed by, any state and which
are rated AA (or its equivalent) or better by Standard & Poors or Moody's; (d)
certificates of deposit, bankers' acceptances, or money market accounts issued
by or established with any commercial bank whose certificates of deposit, other
deposits, or banker's acceptances are rated A-1 or A-1+ by Standard & Poor's or
P-1 by Moody's; (e) SEC registered money market funds invested in Permitted
Investments defined herein; or (f) any other investment approved by CAVC. CAVC
shall pay any applicable federal and state income taxes in respect of any income
from amounts in the Escrow Account. Until otherwise advised in writing by CAVC
and delivered to Agent, upon receipt of the Escrow Deposit, Agent shall invest
the Escrow Deposit in its STI Classic US Government Money Market Fund for which
affiliates of Agent act as investment advisors.
5. Income Disbursements. On the first business day of each calendar
quarter, Escrow Agent shall disburse to CAVC all cash actually received by it as
income on the Escrow Deposit.
6. Claims Procedure.
(a) At any time or from time to time during the term hereof, Seller may
give written notice (a "Notice") to the Agent, with a copy thereof to CAVC, for
distribution of the Escrow Account (i) in satisfaction of any claim of Seller
for Cleanup Costs for which CAVC is responsible pursuant to the Letter Agreement
(each, a "Distribution") or (ii) as a release of funds to CAVC pursuant to the
Letter Agreement. Each Notice shall briefly set forth:
A. the dollar amount of the Distribution ("Dollar
Amount") and whether the recipient thereof is Seller
or CAVC;
B. if the recipient is CAVC, the method of calculation
of the Distribution pursuant to the Letter Agreement;
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C. if the recipient is the Seller:
(1) the nature, basis and Dollar Amount of the
Cleanup Costs for which the Notice is
given; and
(2) a representation that CAVC is responsible
for and is required to pay such Cleanup
Costs under the terms of the Letter
Agreement.
D. a certification that a copy of such Notice has been
delivered to CAVC in accordance with the provisions
of Section 11 hereof.
(b) On the tenth day after the Notice is delivered by Agent to CAVC,
Agent shall disburse from the Escrow Account the Dollar amount specified in the
Notice, as directed by Seller, unless Agent receives a written direction
directing Agent not to make such disbursement ("Notice of Direction"), signed by
CAVC within such 10-day period, accompanied by a certification from CAVC that a
copy of such Notice of Direction has been delivered to Seller in accordance with
the provisions hereof.
(c) If a Notice of Direction is received, Agent shall continue to hold
the Dollar Amount in escrow and shall disburse the Dollar Amount only upon
either (A) receipt of joint written instructions from CAVC and Seller, or (B)
receipt from either CAVC or Seller of a notice enclosing a certified copy of a
court or arbitrator's order, together with a certification from the court or
arbitrator or opinion of counsel to the effect that such order is a final order
in respect of which there is no further right of appeal, directing Agent as to
the manner in which the Dollar Amount is to be disbursed, in which event Agent
shall act in accordance with such order.
(d) Notwithstanding anything contained in Sections 6(a), (b) and (c) of
this Agreement, in the event that Agent receives either (i) a joint written
instruction from CAVC and Seller directing the Agent as to the manner in which
the Escrow Deposit, or any portion thereof, is to be disbursed or (ii) a notice
from either CAVC or Seller enclosing a certified copy of a court or arbitrator's
order, together with a certification from the court or arbitrator or opinion of
counsel to the effect that such order is a final order in respect of which there
is no further right of appeal, directing Agent as to the manner in which the
Escrow Deposit or any portion thereof, is to be disbursed, in either case the
Agent shall act in accordance therewith.
(e) Any amount paid as a Distribution in accordance with the terms
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hereof shall no longer be deemed a part of the Escrow Account or otherwise be
subject to the provisions of this Agreement.
7. Distribution of Escrow Account.
The Escrow Account shall be held by the Agent until the final
disposition of the monies and properties held in escrow hereunder (the
"Termination Date").
8. Exculpation and Indemnification of Agent.
(a) Agent shall have no duties or responsibilities other than those
expressly set forth herein. Agent shall have no duty to enforce any obligation
of any person to make any payment or delivery, or to direct or cause any payment
or delivery to be made, or to enforce any obligation of any person to perform
any other act. Agent shall be under no liability to the other parties hereto or
to anyone else by reason of any failure on the part of any party hereto or any
maker, guarantor, endorser or other signatory of any document or any other
person to perform such person's obligations under any such document. Except for
amendments to this Agreement referred to below, and except for instructions
given to Agent relating to the amount in the Escrow Account under this
Agreement, Agent shall not be obligated to recognize any agreement between any
and all of the persons referred to herein, notwithstanding that references
thereto may be made herein and whether or not it has knowledge thereof.
(b) Agent shall not be liable to any of the parties hereto or to anyone
else for any action taken or omitted by it, or any action suffered by it to be
taken or omitted, in good faith and in the exercise of its own best judgment.
Agent may rely conclusively and shall be protected in acting upon any order,
notice, demand, certificate, opinion or advice of counsel (including counsel
chosen by Agent), statement, instrument, report or other paper or document (not
only as to its due execution and the validity and effectiveness of its
provisions, but also as to the truth and acceptability of any information
therein contained), which is believed by Agent to be genuine and to be signed or
presented by the proper person or persons. Agent shall not be bound by any
notice or demand, or any waiver, modification, termination or rescission of this
Agreement or any other terms thereof, unless evidenced by a writing delivered to
Agent signed by the proper party or parties and, if the duties of Agent are
affected (other than a termination of Agent), unless it shall give its prior
written consent thereto.
(c) Agent shall have no responsibility with respect to the use or
application of any funds or other property paid or delivered by Agent pursuant
to the provisions hereof. Agent shall not be liable to any of the parties hereto
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or to anyone else for any loss which may be incurred by reason of any investment
of any monies which it holds hereunder provided Agent has complied with the
provisions of Section 4 hereof.
(d) To the extent that Agent becomes liable for the payment of taxes,
including withholding taxes, in respect of income derived from the investment of
funds held hereunder or any payment made hereunder, Agent may pay such taxes.
Agent may withhold from any payment of monies held by it hereunder such amount
as Agent estimates to be sufficient to provide for the payment of such taxes not
yet paid, and may use the sum withheld for that purpose. Agent shall be
indemnified and held harmless against any liability for taxes and for any
penalties or interest in respect of taxes, on such investment income or payments
in the manner provided in Section 8(e) hereof.
(e) Agent will be indemnified and held harmless jointly and severally
by CAVC and Seller from and against any and all expenses, including reasonable
counsel fees and disbursements, or loss suffered by Agent in connection with any
action, suit or other proceeding involving any claim, or in connection with any
claim or demand, which in any way, directly or indirectly, arises out of or
relates to this Agreement, the services of Agent hereunder, the monies or other
property held by it hereunder or any income earned from investment of such
monies. Promptly after the receipt by Agent of notice of any demand or claim or
the commencement of any action, suit or proceeding, Agent shall, if a claim in
respect thereof is to be made against any party hereto, any of such parties
notify the parties in writing, but the failure by Agent to give such notice
shall not relieve any of such parties from any liability which such parties may
have to Agent hereunder.
(f) For the purposes hereof, the term "expense or loss" shall include
all amounts paid or payable to satisfy any claim, demand or liability, or in
settlement of any claim, demand, action, suit or proceeding settled with the
express written consent of Agent, and all costs and expenses, including, but not
limited to, reasonable counsel fees and disbursements, paid or incurred in
investigating or defending against any such claim, demand, action, suit or
proceeding.
9. Termination of Agreement and Resignation of Agent.
(a) This Agreement may be terminated by mutual agreement of the parties
and shall terminate on the Termination Date, provided that the rights of Agent
and the obligations of the other parties hereto under Sections 8 and 10 shall
survive the termination hereof.
(b) Agent may resign at any time and be discharged from its duties as
escrow agent hereunder by giving the parties hereto at least 60 days' notice
thereof. As soon as practicable after its resignation, Agent shall turn over to
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a successor escrow agent appointed by the parties hereto all monies and property
held hereunder upon presentation of the document appointing the new escrow agent
and its acceptance thereof. If no new agent is so appointed within the 60-day
period following such notice of resignation, Agent may deposit the aforesaid
monies and property with any court it deems appropriate.
10. Compensation of Agent. Agent shall receive as compensation for
services pursuant to this Agreement an administration fee of $2,000 per annum,
to be borne equally by CAVC and Purchaser. Agent shall be entitled to
reimbursement for all actual and reasonable expenses paid or incurred by it in
the administration of its duties hereunder, including, but not limited to, all
reasonable fees and disbursements of outside counsel, such expenses to be borne
equally by CAVC and Purchaser.
11. Notices. All notices, requests, demands and other communications
provided for herein shall be in writing, shall be delivered by hand or Federal
Express or other overnight courier service, shall be deemed given when delivered
by hand or, if delivered by courier, when received, and shall be addressed to
the parties hereto at their respective addresses listed below or to such other
persons or addresses as the relevant party shall have designated as to itself
from time to time in writing delivered in like manner.
If to CAVC: 0000 Xxxx Xxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attention: President
If to Seller: Mako Marine International, Inc.
0000 X.X. 000 Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: President
If to Purchaser: Tracker Marine, L.P.
0000-X Xxxxx Xxxxxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxxx Xxxxxxxxx
If to Agent: SunTrust Bank, Miami N.A.
000 Xxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attn: Corporate Trust Department
12. Miscellaneous.
(a) In the event of any disagreement regarding the interpretation of
this Agreement, or the rights and obligations set forth herein, or the propriety
of any action contemplated to be taken by Agent hereunder, Agent may, in its
sole discretion, continue to hold the Escrow Deposit until such time as Agent
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shall be entitled to disburse the Escrow Deposit in accordance with the terms of
this Agreement, or file an action in interpleader to resolve such disagreement.
Agent shall be jointly and severally indemnified by CAVC and Seller for all
costs, including reasonable attorneys' fees and costs at the pre- trial, trial
and appellate levels, in connection with the aforementioned interpleader action,
and shall be fully protected in suspending all or a part of its activities under
this Agreement, except for its obligations under Sections 4 and 5 hereof, which
it shall continue to perform, until a final judgment as to which there is no
further rights of appeal in the interpleader action is received.
(b) This Agreement shall be construed without regard to any presumption
or other rule requiring construction against the party causing such instrument
to be drafted. The terms "hereby", "hereof", "hereto", "hereunder" and any
similar terms, as used in this Agreement, refer to the Agreement in its entirety
and not only to the particular portion of this Agreement where the term is used.
The word "person" shall mean any natural person, partnership, corporation,
government and any other form of business or legal entity. All words or terms
used in this Agreement, regardless of the number or gender in which they are
used, shall be deemed to include any other number and any other gender as the
context may require. This Agreement shall not be admissible in evidence to
construe the provisions of any prior agreement.
(c) This Agreement shall be binding upon and inure to the benefit of
each party's respective successors and assigns. No other person shall acquire or
have any rights under or by virtue of this Agreement. This Agreement may not be
changed orally or modified, amended or supplemented without an express written
agreement executed among Agent, Purchasers' Designee and Sellers' Designee. This
Agreement is intended to be for the sole benefit of the parties hereto, and
(subject to the provisions of this Section 12(c)) their respective successors
and assigns, and none of the provisions of this Agreement are intended to be,
nor shall they be construed to be, for the benefit of any third person.
(d) This Agreement shall be governed by and construed in accordance
with the internal laws of the State of Florida. The headings in this Agreement
are for purposes of reference only and shall not limit or otherwise affect any
of the terms hereof.
(e) If the date on which or by which Agent is required to take any
action under this Agreement is a day on which Agent is not open for the
transaction of banking business, then the time for performance of such action
shall be extended to the next day on which Agent is open for the transaction of
banking business.
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13. Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signature of all of the parties reflected hereon as the
signatories.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the day and year first above written.
MAKO MARINE INTERNATIONAL, INC.
By: /s/ Xxxxxxx X. Xxxxx
Title: President and Chief Executive
Officer
TRACKER MARINE, L.P., a limited
partnership
By: JLM MANAGEMENT COMPANY
GENERAL PARTNER
By: /s/ Xxxxxxx Xxxxxxxxx
Title: President
CREDIT AMERICA VENTURE CAPITAL,
INC.
By: /s/ Xxxxxxx X. Xxxxx
AGENT
SUNTRUST BANK, MIAMI N.A.
By: /s/ Xxxx X. XxXxxxx
Title: Corporate Trust Officer
Vice President
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