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EXHIBIT NO. 10.12
ESCROW AGREEMENT
This Escrow Agreement (the "Agreement") is entered into as of
August 31, 1998 by and among SC/NE, LLC, a Delaware limited liability company
("Buyer"), Nextera Enterprises, L.L.C., a Delaware limited liability company and
the controlling member of Buyer ("Nextera"), Sibson & Company, L.P., a Delaware
limited partnership ("Seller"), Sibson & Company, Inc., a Delaware corporation
("General Partner"), SC2, Inc., a Delaware corporation ("Limited Partner"), the
holders of capital stock of the General Partner and the Limited Partner (the
"Shareholders"), and Chase Manhattan Trust Company, National Association, as
escrow agent (the "Escrow Agent").
WHEREAS, pursuant to an Asset Purchase Agreement (the "Purchase
Agreement") dated as of the date hereof, by and among Buyer, Nextera, Seller,
General Partner, Limited Partner and the Shareholders, Buyer is purchasing
certain assets and assuming certain liabilities from Seller;
WHEREAS, Seller, General Partner, Limited Partner and the
Shareholders have agreed to indemnify Buyer and Nextera against certain breaches
of the representations, warranties and covenants made by Seller, General
Partner, Limited Partner and the Shareholders in the Purchase Agreement and
against certain other matters as specified in Article XII of the Purchase
Agreement; and
WHEREAS, to secure payment of the Shareholders' indemnification
obligations, 784,548 Class A Common Units of Nextera (the "Escrow Units" and
together with additions to or earnings on the same, the "Escrow Deposit") are
being deposited, pursuant to Section 2.4 of the Purchase Agreement, in escrow to
be held as hereinafter provided.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises of the parties herein contained, and other good and valuable
consideration, receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Establishment of Escrow: Investment.
(a) Buyer and Nextera have herewith deposited the Escrow Units
with the Escrow Agent contemporaneously herewith. The Escrow Units have been
issued in the name of Seller, and shall be accompanied by stock powers or
similar instruments duly signed in blank by Seller. Seller may transfer and
assign its right to the Escrow Units to General Partner and Limited Partner by
providing written notice to the Escrow Agent and Nextera and by furnishing to
Nextera such documents as may be required to effect such transfer as set forth
in the last sentence of Section 6 hereof. The Escrow Deposit shall be held in
escrow in an account designated as the Sibson & Company Escrow Account or an
account having such other similar designation, subject to the terms and
conditions set forth herein. The Escrow Agent shall invest all cash, if any,
held as part of the Escrow Deposit only in such specific investments as Nextera
and the Escrow
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Representative (as hereinafter defined) shall from time to time jointly direct
in writing to the Escrow Agent; provided, however, that such investments shall
be limited to:
(1) time and demand deposits, certificates of deposit and
acceptances, maturing within ninety (90) days from
the date of acquisition thereof, issued by state and
national banks located in the United States of
America, including the Escrow Agent or any of its
affiliates, and having capital, surplus and profits
aggregating at least one hundred million dollars
($100,000,000);
(2) securities or other obligations of, or guaranteed by,
the United States of America or any agency thereof
having maturities of not greater than one (1) year;
(3) commercial paper, maturing within ninety (90) days
from the date of acquisition thereof, rated A-1 or
P-1 by Standard & Poor's or Xxxxx'x Investors
Service;
(4) repurchase agreements fully collateralized by
obligations described in clauses 1(a)(1), 1(a)(2) or
1(a)(3) hereof;
(5) shares of investment companies registered under the
Investment Company Act of 1940 which invest in any
obligation described herein, or shares of the Chase
Vistasm Money Market Mutual Funds or any other mutual
fund for which the Escrow Agent or an affiliate of
the Escrow Agent serves as investment manager,
administrator, shareholder servicing agent, and/or
custodian or subcustodian, notwithstanding that (i)
the Escrow Agent or an affiliate of the Escrow Agent
receives fees from such funds for services rendered
or (ii) services performed for such funds and
pursuant to this Agreement may at times duplicate
those provided to such funds by the Escrow Agent or
its affiliates.
Until further written notice, cash in the Escrow Deposit shall be
invested in Chase Vistasm Prime Money Market Fund. Unless otherwise directed in
writing by the Escrow Representative and Nextera, the Escrow Agent shall not
invest all or any portion of the Escrow Deposit in any investment if the
maturity date of such investment is later than the Termination Date (as defined
below).
(b) Seller, General Partner, Limited Partner and the Shareholders
(collectively, the "Selling Parties" and each, individually, a "Selling Party")
hereby appoint Seller and, upon conversion of Seller to a limited liability
company, such limited liability company, to serve as the exclusive
representative of the Selling Parties with respect to this Agreement (the
"Escrow Representative"). and Seller, on behalf of itself and its successors and
assigns, hereby accepts such appointment. If, for any reason, the Escrow
Representative shall be either unable or unwilling to serve, a successor Escrow
Representative shall be appointed by written consent of the Shareholders and all
references to the Escrow Representative shall be deemed to include such
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successor. Each Selling Party whose signature appears below expressly agrees
that this Agreement may be amended or modified, and compliance with any
condition or covenant may be waived without the consent of, or execution thereof
by, such Selling Party if the Escrow Representative agrees to such amendment or
modification or grants such waiver, in each case by a writing duly and validly
executed by the Escrow Representative as provided in Section 13; provided,
however, that the Escrow Representative will not enter into any such amendment
or modification or waive any condition or covenant that materially and adversely
affects any Shareholder differently than all other Shareholders affected thereby
without the consent of such Shareholder.
2. Amounts Earned on Escrow Deposit: Tax Matters. All amounts
earned, paid or distributed with respect to the Escrow Deposit, if any, (whether
interest, dividends, distributions from Nextera with respect to the Escrow Units
or otherwise) shall become a part of the Escrow Deposit, shall be held hereunder
upon the same terms as the original Escrow Deposit and shall be distributed
together with the underlying portion of the original Escrow Deposit pursuant to
the terms of this Agreement. The parties agree that, prior to the consummation
of the transactions contemplated by the Exchange Agreement (as defined in
Section 5 below), the Partnership or the General Partner and the Limited
Partner, as the case may be, will include all amounts earned on the Escrow
Deposit (or allocated or distributed with respect thereto) in their gross income
for federal, state and local income tax (collectively, "income tax") purposes
and pay any income tax resulting therefrom. The parties agree that, after the
consummation of the transactions contemplated by the Exchange Agreement, the
Shareholders shall include all amounts earned on the Escrow Deposit in their
gross income for income tax purposes and pay any income tax resulting therefrom,
pro rata in accordance with their combined ownership percentage as set forth on
Exhibit A.
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3. Claims Against Escrow Deposit.
(a) At any time or times prior to the Termination Date (as
hereinafter defined), Nextera, or any successor of Nextera, may make claims
against the Escrow Deposit for indemnification pursuant to and in accordance
with Article XII of the Purchase Agreement or Article VI of the Exchange
Agreement. Nextera shall notify the Escrow Representative and the Escrow Agent
in writing promptly upon determination to make a claim and in any event prior to
the expiration of this Agreement of each such claim, including a summary of the
amount of and bases for such claim. If the Escrow Representative shall dispute
such claim, the Escrow Representative shall give written notice thereof to
Nextera and to the Escrow Agent within thirty (30) days after receipt of notice
of Nextera's claim, in which case the Escrow Agent shall continue to hold the
Escrow Deposit in accordance with the terms of this Agreement; otherwise, such
claim shall be deemed to have been acknowledged to be payable out of the Escrow
Deposit in the full amount thereof and the Escrow Agent shall use its best
efforts to pay such claim to Nextera within three (3) business days after
expiration of said thirty (30) day period or as soon thereafter as possible
following the determination of the fair market value of the Escrow Units
pursuant to Section 3(b)(ii) below. If the amount of the claim exceeds the value
of the Escrow Deposit, the Escrow Agent shall have no liability or
responsibility for any deficiency.
(b) The Escrow Agent shall follow the procedure below in making
any payment in satisfaction of a claim against the Escrow Deposit:
(i) The Escrow Agent shall make such payment first from cash
additions to or earnings on the Escrow Units, if any, until all cash in the
Escrow Deposit has been exhausted.
(ii) To the extent that any claim exceeds the amount of cash
in the Escrow Deposit, the Escrow Agent shall make payment from the Escrow Units
in such number of Escrow Units (computed to the nearest whole unit) having a
value equal to the value of the claim not satisfied by cash payment. Any payment
of Escrow Units by the Escrow Agent to Nextera shall be treated as an adjustment
to the number of Class A Common Units of Nextera received as consideration under
the Purchase Agreement by Seller or, following consummation of the transactions
contemplated by the Exchange Agreement as an adjustment to the consideration
received by the Shareholders pursuant to the Exchange Agreement, as the case may
be. The value of an Escrow Unit for purposes of this Section shall be the fair
market value of such unit on the date of the claim as determined by the Board of
Directors of Nextera (the "Board"). The fair market value shall be determined in
good faith by the Board and the Board shall notify the Escrow Representative and
Escrow Agent in writing of its determination (the "Initial Valuation Notice").
If the Escrow Representative disputes the fair market value of the Escrow Units
as determined by the Board, then the Escrow Representative shall so notify the
Board and Escrow Agent in writing (the "Appraisal Notice") within ten (10)
business days of receipt of the Initial Valuation Notice. Within twenty (20)
business days of the receipt of the Appraisal Notice, the Board and the Escrow
Representative shall each appoint a professional appraiser to determine the fair
market value of the Escrow Units. Each appraiser shall have at least five (5)
years experience in appraising companies similar to Nextera. The two appraisers
shall within the succeeding twenty (20) day period after their selection,
attempt to reach agreement on the fair market value. If the
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appraisers reach such agreement they shall so notify the Escrow Agent and their
agreement shall be final and binding on Buyer, Nextera, the Board, the Escrow
Representative, Seller, General Partner, Limited Partner, the Shareholders, and
their affiliates. If the appraisers fail to agree, they shall within ten (10)
days thereafter select a third appraiser with the same qualification
requirements, and the three (3) appraisers shall establish the fair market value
by majority vote within the succeeding twenty (20) day period and shall notify
the Escrow Agent of their determination. Such determination of the fair market
value shall be final and binding on Buyer, Nextera, the Board, the Escrow
Representative, Seller, the Shareholders, and their affiliates. In all events,
the appraisers selected shall be unaffiliated with and otherwise independent of
Buyer, Nextera, the Board, the Escrow Representative, Seller, General Partner,
Limited Partner, the Shareholders, and their affiliates. If the fair market
value of the Escrow Units, as determined by the appraisers, is less than or no
more than five percent (5%) greater than the value as determined by the Board,
then the Shareholders shall pay all costs associated with the appraisers. If the
fair market value as determined by the appraisers is more than five percent (5%)
greater than the value as determined by the Board, then Nextera shall pay for
all costs associated with the appraisers. In determining fair market value,
neither the Board nor any appraiser shall take into account (x) the value
assigned to the Nextera Class A Units in connection with the Purchase Agreement
or (y) any discount for a minority interest.
To the extent Seller has transferred its rights to the Escrow
Units to General Partner and Limited Partner, the Escrow Units delivered to
Nextera in satisfaction of a claim shall be allocated among the General Partner
and Limited Partner so as to reduce each corporation's interest in the remaining
Escrow Units in proportion to their respective ownership percentages as set
forth on Exhibit A hereto. In the event that the Incorporation Transaction (as
defined in Section 5 below) has occurred, thereafter the Escrow Units delivered
to Nextera in satisfaction of a claim shall be allocated among the Shareholders
so as to reduce each Shareholder's interest in the remaining Escrow Units in
proportion to their respective ownership percentages as set forth on Exhibit A
hereto. Notwithstanding the foregoing, (i) any claim that is an Individual Claim
(as defined in the Purchase Agreement) shall be satisfied by reduction of the
interest in the Escrow Deposit of the Shareholder who committed fraud or who
made the representation, warranty or covenant from which the Individual Claim
arose and no other Shareholder shall have any liability therefor hereunder and
(ii) the satisfaction of one or more Individual Claims as describe in clause (i)
shall not increase the proportion of any subsequent claim for which any
Shareholder would have been responsible absent such prior satisfaction of such
Individual Claims. In the event that the Escrow Agent must make payment with a
number of units less than or different from the number of units represented by a
certificate in the Escrow Deposit, the Escrow Agent shall surrender such
certificate to Nextera and Nextera shall issue to the Escrow Agent certificates
of Nextera Class A Units identical in form but for the number of units as
necessary to allow for proper payment of the claim so long as the number of
units of the new certificates plus the amount of units used to satisfy such
claim shall be equivalent to the total number of units covered by the
surrendered certificate.
4. Disputed Claims.
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(a) If the Escrow Representative shall dispute an indemnification
claim of Nextera as above provided, the Escrow Agent shall set aside a portion
of the Escrow Deposit sufficient to pay said claim in full as reasonably
determined by Nextera in good faith (the "Set Aside Amount"). Nextera shall
notify the Escrow Agent in writing of the Set Aside Amount. If Nextera notifies
the Escrow Agent in writing that it has made out-of-pocket expenditures in
connection with any such disputed claim, and provides paid receipts for such
expenditures, in addition to expenditures included in the Set Aside Amount, an
amount equal to such additional expenditures shall be added to the Set Aside
Amount. The appropriate number of Escrow Units in the Set Aside Amount shall be
determined by the procedure described in Section 3(b)(ii) above.
(b) If the disputed indemnification claim has not been resolved
or compromised within sixty (60) days after the Escrow Agent's receipt of the
Escrow Representative's notice of dispute of the same, or in the event of a
third-party claim or suit, within fifteen (15) days after its resolution or
compromise, said indemnification claim shall be referred to the American
Arbitration Association, to be settled by binding arbitration in New York, New
York, in accordance with the commercial arbitration rules of the Association.
The fees and expenses of the arbitrator shall be borne equally by the
Shareholders on the one hand and Nextera on the other. In no event shall the
Escrow Agent be responsible for any fee or expense of any party to any
arbitration proceeding. The determination of the arbitrator as to the amount, if
any, of the indemnification claim which is properly allowable shall be
conclusive and binding upon the parties hereto and judgment may be entered
thereon in any court having jurisdiction thereof, including, without limitation,
any court in the State of New York. The arbitrator shall have the authority in
its discretion to award to the prevailing party reasonable costs and expenses
including attorney's fees and the cost of arbitration. The Escrow Agent shall
use its best efforts to make payment of such claim, as and to the extent
allowed, to Nextera out of the Set Aside Amount (or if insufficient, out of the
Escrow Deposit) within three (3) business days following the Escrow Agent's
receipt of said determination or as soon thereafter as possible.
(c) Notwithstanding Section 4(b), if a disputed indemnification
claim has not been resolved or compromised as of the Termination Date (as
hereinafter defined), and such claim does not involve a third-party claim or
suit, Nextera and the Escrow Representative shall continue to negotiate in good
faith a settlement of such claims for a period of ten (10) days after the
Termination Date. If, after the expiration of such ten-day period, such
indemnification claim still has not been resolved or compromised, such claim
shall be settled in accordance with the arbitration provisions set forth in
Section 4(b).
(d) It is understood and agreed that should any dispute arise
under this Section 4, the Escrow Agent, upon receipt of written notice of such
dispute or claim by the Escrow Representative, is authorized and directed to
retain in its possession without liability to anyone, the Set Aside Amount
relating to such dispute plus any expenditures of Nextera made pursuant to
Section 4(a) until such dispute shall have been settled pursuant to this Section
4. The Escrow Agent may, but shall be under no duty whatsoever to, institute or
defend any legal proceedings which relate to the Escrow Deposit.
(e) In connection with the resolution of a disputed
indemnification claim, the arbitrator may award, in its discretion, to the
Shareholders interest on the amount by which the
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Set Aside Amount exceeds the amount which the arbitrator determined would have
been a reasonable Set Aside Amount, computed from the Termination Date to the
date such Set Aside Amount is released from escrow if the arbitrator determines
that (i) Nextera had no reasonable basis for making the indemnification claim or
(ii) the Set Aside Amount as determined by Nextera had no reasonable relation to
the amount of the claim. The arbitrator may not award interest under this
Section 4(e) if Nextera's claim is occasioned by, or the Set Aside Amount
corresponds to the amount of, a third-party claim regardless of the merits of
such third-party claim.
5. Incorporation Transaction; Exchange of Escrow Units. Pursuant
to that certain Share Exchange Agreement (the "Exchange Agreement") dated as of
the date hereof by and among Buyer, Nextera, the Partnership, General Partner,
Limited Partner and the Shareholders, the Shareholders shall exchange their
shares of capital stock of General Partner and Limited Partner for Newco Class A
Stock (as defined in the Exchange Agreement) and the remaining Escrow Units at
the time of the Incorporation Transaction (as defined in the Exchange Agreement)
shall be released from escrow under this Agreement and an appropriate number of
shares of Newco Class A Stock (as defined in the Exchange Agreement) shall be
delivered to the Escrow Agent in substitution for the Escrow Units. Following
the Incorporation Transaction, all references to Escrow Units in this Agreement
shall be deemed to include such shares of Newco Class A Stock. The Escrow Agent
shall follow the joint written instruction of Nextera and the Escrow
Representative in carrying out the provisions of this Section 5.
6. Termination. This Agreement shall terminate on the date that
the Escrow Deposit is reduced to zero as the result of payments by the Escrow
Agent to Nextera in accordance with the provisions of Section 3 or Section 4.
If, however, the Escrow Deposit has not been reduced to zero as of the date that
is eighteen (18) months following the date of this Agreement (the "Termination
Date") and there are no outstanding indemnification claims on the Termination
Date of which Escrow Agent has received notice hereunder, the Escrow Agent shall
distribute the amount remaining in the Escrow Deposit to Seller or, to the
extent Seller has transferred to the General Partner and Limited Partner its
rights to the Escrow Deposit, the General Partner and Limited Partner in
accordance with their respective ownership percentages as set forth on Exhibit A
hereto, or, in the event that the Incorporation Transaction has occurred, to the
Escrow Representative for distribution to the Shareholders in accordance with
their respective ownership percentages as set forth on Exhibit A hereto. After
such payment this Agreement shall terminate; otherwise this Agreement shall
continue in effect until all indemnification claims Nextera has made pursuant to
Section 3 hereof on or prior to the Termination Date shall have been disposed
of. As of the Termination Date, an amount of the Escrow Deposit adequate to
cover all disputed and undisputed claims made by Nextera pursuant to Section 3
hereof will be held by the Escrow Agent (with the number of Escrow Units, if
any, to be retained determined in accordance with Section 3(b)(ii)), and the
Escrow Agent shall distribute on the Termination Date the balance, if any, of
the Escrow Deposit to Seller or, to the extent Seller has transferred to the
General Partner and Limited Partner its rights to the Escrow Deposit, the
General Partner and Limited Partner in accordance with their respective
ownership percentages as set forth on Exhibit A hereto, or, in the event that
the Incorporation Transaction has occurred, to the Escrow Representative for
distribution to the Shareholders in accordance with their respective ownership
percentages as set forth on Exhibit A hereto. At such time as all remaining
indemnification claims hereunder have been resolved and the Escrow Agent has
received a written notice executed by
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Nextera and the Escrow Representative, or notification of a determination of an
arbitrator pursuant to Section 4(b), to that effect and any amounts to be
distributed to Nextera in connection therewith have been so distributed, the
Escrow Agent shall distribute the remaining Escrow Deposit, if any, to Seller
or, to the extent Seller has transferred to the General Partner and Limited
Partner its rights to the Escrow Deposit, to the General Partner and Limited
Partner in accordance with their respective ownership percentages as set forth
on Exhibit A hereto, or in the event that the Incorporation Transaction has
occurred or if, following a breach of Nextera's obligation to effect the
Incorporation Transaction under the Exchange Agreement, the General Partner and
Limited Partner have transferred to the Shareholders their rights to Nextera
Class A Units, to the Escrow Representative for distribution to the
Shareholders, in accordance with their respective ownership percentages as set
forth on Exhibit A hereto. The Escrow Representative shall notify the Escrow
Agent in writing upon Seller's transfer of its rights hereunder to General
Partner and Limited Partner, and Nextera, the Escrow Representative, General
Partner and Limited Partner shall take all necessary action to cause (i) the
certificates representing the Escrow Units registered in the name of the Seller
and the related stock powers or similar instruments executed by the Seller and
deposited with the Escrow Agent to be released from escrow and transferred to
General Partner and Limited Partner and (ii) new certificates registered in the
name of General Partner and Limited Partner, together with stock powers or
similar instruments duly signed in blank by General Partner and Limited Partner,
to be deposited with the Escrow Agent in substitution for the certificates
registered in the name of the Seller and the stock powers or similar instruments
executed by Seller.
7. The Escrow Agent.
(a) Direction from Nextera and Escrow Representative.
Notwithstanding anything herein to the contrary, the Escrow Agent shall promptly
dispose of all or any part of the Escrow Deposit as directed by a writing signed
by Nextera and Escrow Representative.
(b) Reliance by Escrow Agent; Liability of Escrow Agent. Except
with respect to capitalized terms used herein and defined in the Purchase
Agreement or the Exchange Agreement, the Escrow Agent will not be subject to, or
be obliged to recognize, any other agreement between the parties hereto or
directions or instructions not specifically set forth as provided for herein.
The Escrow Agent will not make any payment or disbursement from or out of the
Escrow Deposit that is not expressly authorized pursuant to this Agreement. The
Escrow Agent undertakes to perform only such duties as are expressly set forth
herein. The Escrow Agent may rely and shall be protected in acting or refraining
from acting upon any written notice, 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. The Escrow Agent shall be under no duty to
inquire into or investigate the validity, accuracy or content of any such
document. The Escrow Agent shall have no duty to solicit any payment which may
be due it hereunder. The Escrow Agent shall not be liable for any action taken
or omitted by it in good faith unless a court of competent jurisdiction
determines that the Escrow Agent's gross negligence and willful misconduct was
the primary cause of any loss to Buyer, Nextera, Seller, General Partner,
Limited Partner or the Shareholders. In the administration of the Escrow Deposit
hereunder, the Escrow Agent may execute any of its powers and perform its duties
hereunder directly or through agents or attorneys and may consult with counsel,
accountants and other skilled persons to be selected
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and retained by it. The Escrow Agent shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the advice or opinion
of any such counsel, accountants or other skilled persons. Buyer, Nextera,
Seller, General Partner, Limited Partner and the Shareholders jointly and
severally hereby agree to indemnify and hold the Escrow Agent and its directors,
officers, agents and employees (collectively, the "Indemnitees") harmless from
and against any and all claims, liabilities, losses, damages, fines, penalties,
and expenses, including out-of-pocket and incidental expenses and legal fees and
expenses ("Losses") that may be imposed on, incurred by, or asserted against the
Indemnitees or any of them for following any instructions or other directions
upon which the Escrow Agent is authorized to rely pursuant to the terms of this
Agreement. In addition to and not in limitation of the immediately preceding
sentence, the Buyer, Nextera, Seller, General Partner, Limited Partner and the
Shareholders also agree jointly and severally to indemnify and hold the
Indemnitees and each of them harmless from and against any and all Losses that
may be imposed on, incurred by, or asserted against the Indemnitees or any of
them in connection with or arising out of Escrow Agent's performance under this
Agreement, provided the Indemnitees have not acted with gross negligence or
engaged in willful misconduct. Anything in this Agreement to the contrary
notwithstanding, in no event shall the Escrow Agent be liable for special,
indirect or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits). As between Buyer and Nextera on the one hand and
Seller, General Partner, Limited Partner and the Shareholders on the other, each
shall bear equally the indemnification obligations set forth in this Section
7(b). The provisions of this Section 7(b) shall survive the termination of this
Agreement and the resignation or removal of the Escrow Agent for any reason.
(c) Fees and Expenses of the Escrow Agent. All fees of the Escrow
Agent for its services hereunder, together with any expenses reasonably incurred
by the Escrow Agent in connection with this Agreement, shall be shared equally
by Buyer on the one hand and the Seller, General Partner, Limited Partner and
the Shareholders on the other. The initial fees due the Escrow Agent to be paid
by the Seller, General Partner, Limited Partner and the Shareholders (which are
expected to be approximately $1,100) shall be paid in cash at the Closing and
reduced from the cash portion of the Purchase Price (as defined in the Purchase
Agreement). All other fees of the Escrow Agent in connection herewith shall be
due from the parties upon receipt of an invoice from the Escrow Agent delivered
to Nextera and the Escrow Representative.
(d) Resignation and Removal of Escrow Agent; Successor Escrow
Agent.
(i) The Escrow Agent may resign from its duties hereunder by
giving each of the parties hereto not less than thirty (30) days prior written
notice of the effective date of such resignation (which effective date shall be
at least thirty (30) days after the date such notice is given). In addition, the
Escrow Agent may be removed and replaced on a date designated in a written
instrument signed by Nextera and the Escrow Representative and delivered to the
Escrow Agent. The parties hereto intend that a successor escrow agent mutually
acceptable to the Escrow Representative and Nextera will be appointed to fulfill
the duties of the Escrow Agent hereunder for the remaining term of this
Agreement in the event of the Escrow Agent's resignation or removal. Upon the
effective date of such resignation or removal, the Escrow Agent shall deliver
the property comprising the Escrow Deposit to such successor escrow agent,
together with an accounting of the investments held by it and all transactions
related to this
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Agreement, including any distributions made and such records maintained by the
Escrow Agent in connection with its duties hereunder and other information with
respect to the Escrow Deposit as such successor may reasonably request. If on or
before the effective date of such resignation or removal, a successor escrow
agent has not been appointed, the Escrow Agent will thereupon deposit the Escrow
Deposit into the registry of a court of competent jurisdiction.
Upon written acknowledgment by a successor escrow
agent appointed in accordance with this Section 7(d)(i) of its agreement to
serve as escrow agent hereunder and the receipt of the property then comprising
the Escrow Deposit, the Escrow Agent shall be fully released and relieved of all
duties, responsibilities and obligations under this Agreement, except for those
arising under the last sentence of Section 7(b) of this Agreement, and such
successor escrow agent shall for all purposes hereof be the Escrow Agent.
(ii) Any corporation, association or other entity into which
the Escrow Agent may be converted or merged, or with which it may be
consolidated, or to which it may sell or otherwise transfer all or substantially
all of its corporate trust business, or any corporation, association or other
entity resulting from any such merger, conversion, consolidation, sale or other
transfer, shall, ipso facto, be and become successor Escrow Agent hereunder,
vested with all of the powers, discretions, immunities, privileges and all other
matters as was its predecessor, without the execution or filing of any
instrument or any further act on the part or any of the parties hereto, anything
herein to the contrary notwithstanding.
8. Voting of Escrow Units. So long as any Escrow Units are
retained by the Escrow Agent, Seller or, to the extent Seller has transferred
its interest to General Partner and Limited Partner, General Partner and Limited
Partner in accordance with their respective ownership percentages as set forth
on Exhibit A hereto, or, in the event that the Incorporation Transaction has
occurred or if, following a breach of Nextera's obligation to effect the
Incorporation Transaction under the Exchange Agreement, the General Partner and
Limited Partner have transferred to the Shareholders their rights to Nextera
Class A Units, the Shareholders shall be entitled to exercise the voting power,
if any, with respect to in the Escrow Units, in accordance with their respective
ownership percentages as set forth on Exhibit A hereto.
9. Governing Law. IT IS THE PARTIES' INTENT THAT THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW).
10. Counterparts. This Escrow Agreement may be executed in one or
more counterparts, all of which documents shall be considered one and the same
document.
11. Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be deemed to have been given
when received, if personally delivered or sent by facsimile transmission, or
three (3) days after deposited in the U.S. mails for delivery by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
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TO BUYER: SC/NE, LLC
Xxx Xxxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Xx.
Fax: (000) 000-0000
With a copy to: Xxxxxx & Xxxxxxx
000 X Xxxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
With an additional copy to: Maron & Sandler
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
TO NEXTERA: Nextera Enterprises, L.L.C.
Xxx Xxxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Xx.
Fax: (000) 000-0000
With a copy to: Xxxxxx & Xxxxxxx
000 X Xxxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxx, Esq.
Fax: (000) 000-0000
With an additional copy to: Maron & Sandler
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
TO SELLER: Sibson & Company, L.P.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
With a copy to: Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
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TO GENERAL PARTNER: Sibson & Company, Inc.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
With a copy to: Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
TO LIMITED PARTNER: SC2, Inc.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
With a copy to: Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
TO ANY SHAREHOLDER: To the address set forth in the
Purchase Agreement.
With a copy to: Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
TO ESCROW AGENT: Chase Manhattan Trust Company,
National Association
One Oxford Centre
301 Grant Street, Suite 1100
Xxxxxxxxxx Xxxxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Fax: (000) 000-0000
Addresses may be changed by written notice given pursuant to this
Section. Any notice given hereunder may be given on behalf of any party by his
counsel or other authorized representatives.
11. Certification of Tax Identification Number. The parties
hereto agree to provide the Escrow Agent with a certified tax identification
number by signing and returning a Form W-9 (or Form W-8, in the case of non-U.S.
persons) to the Escrow Agent prior to the date on which any income earned on the
investment of the Escrow
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Deposit is credited to the Escrow Deposit. The parties hereto understand that,
in the event their tax identification numbers are not certified to the Escrow
Agent, the Internal Revenue Code, as amended from time to time, may require
withholding of a portion of any interest or other income earned on the
investment of the Escrow Deposit.
12. Force Majeure. Neither Buyer, Nextera, Seller, General
Partner, Limited Partner, the Shareholders nor the Escrow Agent shall be
responsible for delays or failures in performance under this Agreement resulting
from acts beyond its control. Such acts shall include but not be limited to acts
of God, strikes, lockouts, riots, acts of war, epidemics, governmental
regulations superimposed after the fact, fire, communication line failures,
computer viruses, power failures, earthquakes or other disasters.
13. Modifications. This Agreement may not be altered, amended or
modified, nor may compliance with any condition or covenant set forth herein be
waived, except by a writing duly and validly executed by each party hereto, or
in the case of a waiver, the party waiving compliance; provided, however, that,
except as specifically provided by Section 1(b) above, no amendment or
modification of this Agreement or waiver of compliance with any condition or
covenant that has been duly and validly executed in writing by the Escrow
Representative shall require the consent of, or execution thereof, by any other
Selling Party and shall be valid and binding without such consent or execution.
No course of conduct shall constitute a waiver of any of the terms and
conditions of this Escrow Agreement, unless such waiver is specified in writing,
and then only to the extent so specified. A waiver of any of the terms and
conditions of this Escrow Agreement on one occasion shall not constitute a
waiver of the other terms of this Escrow Agreement, or of such terms and
conditions on any other occasion.
14. Reproduction of Documents. This Agreement and all documents
relating thereto, including, without limitation, (a) consents, waivers and
modifications which may hereafter be executed, and (b) certificates and other
information previously or hereafter furnished, may be reproduced by a
photographic, photostatic, microfilm, optical disk, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
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IN WITNESS WHEREOF, the parties have caused this Escrow Agreement
to be executed, as of the date first written above.
BUYER:
SC/NE, LLC, a Delaware limited liability company
By: NEXTERA ENTERPRISES, L.L.C.
Its: Sole Member
By: /s/ XXXXXXX X. XXXXXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Chief Financial Officer
NEXTERA:
NEXTERA ENTERPRISES, L.L.C.
By: /s/ XXXXXXX X. XXXXXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Chief Financial Officer
SELLER:
SIBSON & COMPANY, L.P.
By: Sibson & Company, Inc., its General Partner
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Tax Identification Number:
----------------------
GENERAL PARTNER:
SIBSON & COMPANY, INC.
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Tax Identification Number:
----------------------
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LIMITED PARTNER:
SC2, INC.
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
Tax Identification Number:
----------------------
ESCROW AGENT:
CHASE MANHATTAN TRUST COMPANY, NATIONAL
ASSOCIATION, as Escrow Agent
By: /s/ XXXXX X. XXXXX
--------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
SHAREHOLDERS:
/s/ XXXX XXXXXXX
--------------------------------------------
Xxxx Xxxxxxx
Tax Identification Number:
------------------
/s/ XXXX XXXXXXXXXXX
--------------------------------------------
Xxxx Xxxxxxxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXXXX XXXXXX
--------------------------------------------
Xxxxxxxxx (Xxx) Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXXX
--------------------------------------------
Xxxxx Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX XXXXXXXX
--------------------------------------------
Xxxxxxx Xxxxxxxx
Tax Identification Number:
------------------
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/s/ XXXXXX XXXXX
--------------------------------------------
Xxxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXXX
--------------------------------------------
Xxxxx Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX XXXXX
--------------------------------------------
Xxxxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXXXX XXXXX
--------------------------------------------
Xxxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXXXX XXXXX
--------------------------------------------
Xxxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXXXXXXX XXXX
--------------------------------------------
Xxxxxxxxx Xxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXXXXXX
--------------------------------------------
Xxxxx Xxxxxxxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXXXXXX
--------------------------------------------
Xxxxx Xxxxxxxxx
Tax Identification Number:
------------------
/s/ XXXXXX XXXXXXXX
--------------------------------------------
Xxxxxx Xxxxxxxx
Tax Identification Number:
------------------
/s/ XXXXX XxXXXXX
--------------------------------------------
Xxxxx XxXxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX X'XXXXXXX
--------------------------------------------
Xxxxxxx X'Xxxxxxx
Tax Identification Number:
------------------
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/s/ XXXXXXX XXXXX
--------------------------------------------
Xxxxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXX XXXX
--------------------------------------------
Xxxx Xxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXX
--------------------------------------------
Xxxxx Xxxxx
Tax Identification Number:
------------------
/s/ XXXX XXXXXXX
--------------------------------------------
Xxxx Xxxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX XXXXXX
--------------------------------------------
Xxxxxxx Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX XXXXXXXX
--------------------------------------------
Xxxxxxx Xxxxxxxx
Tax Identification Number:
------------------
/s/ XXXXXX XXXXXX
--------------------------------------------
Xxxxxx (Chip) Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXXXX XXXXXX
--------------------------------------------
Xxxxxxx Xxxxxx
Tax Identification Number:
------------------
/s/ XXXXX XXXXXXXX XXXXX
--------------------------------------------
Xxxxx Xxxxxxxx Xxxxx
Tax Identification Number:
------------------
17
