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Exhibit 2.4
EXHIBIT A TO
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PERCEPTION LAMINATES AGREEMENT
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ESCROW AGREEMENT
This Escrow Agreement (this "ESCROW AGREEMENT") is made and entered into as
of the date (the "EFFECTIVE DATE") set forth on SCHEDULE 1 hereto ("SCHEDULE 1")
by and among Teradyne, Inc., a Massachusetts corporation ("BUYER"); Precision
Laminates, Inc., a California corporation (the "COMPANY"); Xxxxxx Xxxxxxx, a
security Holder of the Company Holder(the "HOLDER"); and The Chase Manhattan
Bank, as escrow agent and custodian of the Escrow Fund (as defined below) (the
"ESCROW AGENT").
A. Buyer, the Company, T-P Acquisition Corp., a Delaware corporation, and
the Holder have entered into an Agreement and Plan of Reorganization dated as of
August 1, 2000 (the "AGREEMENT") setting forth certain terms and conditions
pursuant to which Buyer is acquiring all outstanding shares of the Company from
the Holder.
B. Pursuant to Section 2.04 of the Agreement, Shares of Buyer Stock (as
defined therein) are to be issued to the Holder.
C. The Agreement provides that ten percent (10%) (the "ESCROW
PERCENTAGE") of the Buyer Stock issued in exchange for outstanding Shares
pursuant to the Agreement will be placed in an escrow account to secure certain
indemnification obligations of the Holder to Buyer and the Company under Article
XI of the Agreement on the terms and conditions set forth therein and herein.
D. Unless otherwise indicated herein, all terms used herein without
definition shall have the same meaning as set forth in the Agreement.
NOW THEREFORE, for and in consideration of the foregoing and the mutual
covenants and agreements contained in the Agreement and in this Escrow
Agreement, the parties agree as follows:
1. ESTABLISHMENT OF ESCROW ACCOUNT
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1.1 DEPOSIT OF SHARES. Buyer shall deposit as soon as practicable on
the Holder's behalf with the Escrow Agent stock certificates representing the
Escrow Shares issued pursuant to the Agreement registered in the name of the
Holder and in the relative amounts set forth on EXHIBIT 1.1 hereto (the "INITIAL
ESCROW SHARES") and an Assignment separate from the stock certificates executed
by such Holder. Any shares of Buyer capital stock that result from any share
dividend, reclassification, stock split, subdivision or combination of shares,
recapitalization, merger or other events made with respect to any Escrow Shares
held in escrow under this Escrow Agreement ("ADDITIONAL SHARES") shall be
delivered to the Escrow Agent by the Buyer on behalf of the Holder and shall be
held by the Escrow Agent in accordance with this Escrow Agreement. Unless
otherwise indicated, as used in this Escrow Agreement, the term "ESCROW SHARES"
includes the Initial Escrow Shares and any Additional Shares, and the term
"ESCROW FUND" shall include the Escrow Shares and the Proceeds (as defined
below). The Escrow Agent agrees to accept delivery of the Escrow Shares and to
hold the Escrow Fund in escrow in accordance with this Escrow Agreement and to
release the Escrow Fund out of escrow as provided in this Escrow Agreement.
1.2 DIVIDENDS; VOTING AND RIGHTS OF OWNERSHIP. Any cash dividends,
dividends payable in property or other distributions of any kind (except for
Additional Shares) made in respect of
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the Escrow Shares shall be held by the Escrow Agent pursuant to this Agreement.
The Holder shall have the right to vote the Escrow Shares held in escrow for the
account of Holder so long as such Escrow Shares are held in escrow. While the
Escrow Shares remain in the Escrow Agent's possession pursuant to this Escrow
Agreement, the Holder shall retain and shall be able to exercise all other
incidents of ownership of the Escrow Shares that are not inconsistent with the
terms and conditions hereof. Without limiting the foregoing, following the
expiration of the lock-up period required under the "pooling of interests"
accounting rules (the "Lock-Up Date"), the Holder may instruct the Escrow Agent
to sell the Escrow Shares for cash provided that any and all proceeds (the
"PROCEEDS") from such sale shall become part of the Escrow Fund and shall be
disbursed in accordance with this Agreement. The Escrow Agent shall hold such
Proceeds in the Escrow Fund and shall invest such Proceeds as hereinafter
provided.
1.3 NO ENCUMBRANCE. None of the Escrow Fund or any beneficial
interest therein may be pledged, sold, assigned or transferred, including by
operation of law or by Holder, or may be taken or reached by any legal or
equitable process in satisfaction of any debt or other liability of Holder,
prior to the delivery of the Escrow Fund by the Escrow Agent or Buyer to Holder
pursuant to this Escrow Agreement.
1.4 POWER TO TRANSFER ESCROW FUND. The Escrow Agent is hereby granted
the power to effect any transfer of the Escrow Fund provided for in this Escrow
Agreement.
1.5 INVESTMENT OF PROCEEDS. During the term of this Escrow Agreement
and following the Lock-Up Date, the Proceeds (if any) shall be invested and
reinvested by the Escrow Agent (i) in the investment indicated on SCHEDULE 1,
(ii) at the direction, if any, of the Holder, in the investments described in
SCHEDULE 2, or (iii) in such other investments as shall be directed in writing
by the Buyer and the Holder and as shall be acceptable to the Escrow Agent. All
investment orders involving U.S. Treasury obligations, commercial paper and
other direct investments may be executed through broker-dealers selected by the
Escrow Agent (which shall include affiliates of the Escrow Agent). Periodic
statements will be provided to the Holder and Buyer reflecting transactions
executed on behalf of the Escrow Fund. The Buyer and Holder, upon written
request, will receive a statement of transaction details upon completion of any
securities transaction in the Proceeds without any additional cost. The Escrow
Agent shall have the right to liquidate any investments held in order to provide
funds necessary to make required payments under this Escrow Agreement. The
Escrow Agent shall have no liability for any loss sustained as a result of any
investment in an investment indicated on SCHEDULE 1 or any investment made
pursuant to the instructions of the parties hereto or as a result of any
liquidation of any investment prior to its maturity or for the failure of the
parties to give the Escrow Agent instructions to invest or reinvest the
Proceeds.
2. RESOLUTION OF CLAIMS
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2.1 INDEMNIFICATION OBLIGATIONS. The Escrow Fund shall serve as the
first source, but not the sole source, of payment for the indemnity obligations
of the Holder under Article XI of the Agreement, which obligations shall
continue in accordance with Article XI of the Agreement. Payment for any amount
determined as provided below to be owing to Buyer or the Company under such
indemnity obligations under the Agreement ("DAMAGES") and any award of
attorneys' fees and charges owing to Buyer pursuant to Sections 2.3(c)(iv) or
4.3 of this Agreement (a "PREVAILING PARTY AWARD") shall be made by the release
of all or a portion, as the case may be, of the Escrow Fund to Buyer (each such
payment, an "ESCROW ADJUSTMENT"), subject to the limitations set forth in
Section 11.02 of the Agreement. By the execution of this Escrow Agreement, the
Holder agrees to be bound
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by the indemnification provisions set forth in Article XI of the Agreement and
confirms that the issuance by Buyer of the Escrow Percentage of the Buyer Stock
pursuant to the Agreement is subject to this Escrow Agreement. Notwithstanding
anything to the contrary herein, Buyer shall not be entitled to receive payment
of any portion of a Prevailing Party Award which is already a part of Damages
(i.e., there shall be no double payment of legal fees). Any Escrow Adjustments
and corresponding release to Buyer of the Escrow Fund shall be made as of the
date or dates specified and the manner provided for in this Escrow Agreement.
Each Escrow Adjustment to the Escrow Fund shall be made by the release to Buyer
of a portion of the Escrow Fund having an aggregate value equal to the Damages
and any Prevailing Party Award, with the per share value of any Escrow Shares
being equal, for all purposes under this Escrow Agreement, to the closing price
of such Escrow Shares on the Closing Date (the "BUYER STOCK PRICE"). Any such
release shall be made first through the release of Escrow Shares, if any are
then held in the Escrow Fund, and thereafter through the release of Proceeds
having an aggregate value equal to the value of the number of Escrow Shares
which would otherwise have been so released hereunder in satisfaction of the
Holder's indemnification obligation. In lieu of releasing any fractional Escrow
Shares, any fraction of a released Escrow Share that would otherwise be released
shall be rounded to the nearest whole Escrow Share and any amounts released in
excess of the Damages as a result of such rounding shall be returned to Escrow
Fund. In the event of doubt, and notwithstanding any contained in this Section
2.1 to the contrary, Buyer, and the Holder agree that the foregoing provisions
of this Section 2.1 shall be applied and interpreted in a manner consistent with
the "pooling of interests" accounting rules.
2.2 NOTICE OF CLAIMS. Promptly after the receipt by Buyer of notice
or discovery of any claim, damage, or legal action or proceeding giving rise to
indemnification rights under the Agreement (a "CLAIM") Buyer shall give the
Holder written notice of such Claim and shall provide a copy of such notice to
the Escrow Agent. Each notice of a Claim by Buyer (a "NOTICE OF CLAIM") shall be
in writing, shall be delivered on or before the Release Date (as defined in
Section 3.1 below) and shall contain a detailed account of the specific facts
known to Buyer on which the Claim is based, including a description of the
specific representation, warranty or covenant in the Agreement (if any) which
Buyer reasonably believes has been breached. The Notice of Claim shall specify
whether the matter is subject to a third-party claim against Buyer or the
Company in a litigation or arbitration or whether the matter concerns disputes
regarding a breach of representations and warranties or performance or
nonperformance of a party's obligations under the Agreement.
2.3 RESOLUTION OF CLAIMS. Any Notice of Claim received by the Holder
and the Escrow Agent pursuant to Section 2.2 above shall be resolved as follows:
(a) UNCONTESTED CLAIMS. In the event that the Holder does not
contest a Notice of Claim (an "UNCONTESTED CLAIM") in writing within thirty (30)
calendar days, as provided below in Section 2.3(b), Buyer may deliver to the
Escrow Agent, with a copy to the Holder, a written demand by Buyer (a "BUYER
DEMAND") stating that a Notice of Claim has been given as required in this
Escrow Agreement and that no notice of contest has been received from the Holder
during the period specified in this Escrow Agreement and further setting forth
the proposed Escrow Adjustments to be made in accordance with this Section
2.3(a). Within thirty (30) calendar days after receipt of the Buyer Demand, the
Holder may object in a written notice delivered to Buyer and the Escrow Agent to
the computations or other administrative matters relating to the proposed Escrow
Adjustments (but may not object to the validity or amount of the Claim
previously disclosed in the Notice of Claim), whereupon neither the Escrow Agent
nor Buyer shall make any of the Escrow Adjustments until either: (i) Buyer and
the Holder shall have given the Escrow Agent joint written notice setting forth
the agreed Escrow Adjustments, or (ii) the matter is resolved as provided in
Sections 2.3(b) and 2.3(c).
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Upon satisfaction of the foregoing, the Escrow Agent, as directed in writing by
Buyer, and Buyer shall promptly take all steps to implement the final Escrow
Adjustments.
(b) CONTESTED CLAIMS. In the event that the Holder gives written
notice to Buyer and the Escrow Agent contesting all or a portion of a Notice of
Claim (a "CONTESTED CLAIM") within the 30-day period provided above, matters
relating to such Contested Claim that are subject to third party claims against
Buyer or the Company in a litigation or arbitration shall await the final
decision, award or settlement of such litigation or arbitration, while matters
relating to such Contested Claim that arise between Buyer on the one hand and
the Company and/or the Holder on the other hand, including any disputes
regarding breach of representations and warranties or performance or
nonperformance of a party's obligations under the Agreement ("ARBITRABLE
CLAIMS") shall be settled in accordance with Section 2.3(c) below. Any portion
of a Notice of Claim that is not contested or is subsequently settled by Buyer
and the Holder shall be resolved as set forth above in Section 2.3(a). If
written notice is received by the Escrow Agent that a Notice of Claim is
contested by the Holder, then the Escrow Agent shall hold hereunder after what
would otherwise be the Release Date (as defined in Section 3.1 below), the
number of Escrow Shares specified in the Release Notice or as otherwise provided
in Section 3.1, until the earlier of: (i) receipt of a settlement agreement
executed by Buyer and the Holder setting forth a resolution of the Notice of
Claim and the Escrow Adjustments; (ii) receipt of a written notice from Buyer (a
"BUYER DISTRIBUTION NOTICE") attaching a copy of the final award or decision of
the arbitrator and setting forth the Escrow Adjustments (Buyer shall at the same
time provide a copy of the Buyer Distribution Notice to the Holder); or (iii)
receipt of a written notice from the Holder (a "REPRESENTATIVE DISTRIBUTION
NOTICE") attaching a copy of the final award or decision of the arbitrator that
no Escrow Adjustments are to be made as a result of such award (the Holder shall
at the same time provide a copy of the Representative Distribution Notice to
Buyer). If the earliest of the three events described in the preceding sentence
is (i) or (ii), the Escrow Agent shall, within twenty (20) calendar days of
receipt of the settlement agreement or the Buyer Distribution Notice, as
applicable, (a) release to Buyer of that portion of the Escrow Fund specified in
the Escrow Adjustments and (b) if the Release Date has occurred, and there are
no remaining unresolved Contested Claims, release to the Holder the balance of
the Escrow Fund. If the earliest of the three events described above is (iii)
and the Release Date has occurred, and there are no remaining unresolved
Contested Claims, the Escrow Agent shall, within twenty (20) calendar days of
receipt of the Representative Distribution Notice, release to the Holder the
Retained Escrow (as defined in Section 3.1), provided that if the Release Date
has not occurred the Escrow Fund shall continue to be held pursuant to the terms
of this Agreement.
(c) ARBITRATION.
(i) ARBITRATION RULES. Any Arbitrable Claim, and any dispute
between the Holder and Buyer under this Escrow Agreement, shall be submitted to
final and binding arbitration before a single arbitrator in San Diego,
California in accordance with the commercial arbitration rules of the American
Arbitration Association; provided, however, that if the Arbitrable Claim shall
exceed $1,000,000, the arbitration shall be before three arbitrators, two of
whom shall be lawyers with not less than ten (10) years of corporate or related
business experience. Among other matters, such arbitrator(s) shall be authorized
upon request of either Buyer or the Holder determine whether such Arbitrable
Claim is of a nature which may be resolved, and appropriate relief afforded,
pursuant to arbitration.
(ii) BINDING EFFECT. The final decision of the arbitrator
shall be furnished in writing to the Escrow Agent, the Holder, the Holder and
Buyer and will constitute a conclusive determination of the issue in question,
binding upon the Holder and Buyer. The arbitrator
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shall have the authority to grant any equitable and legal remedies that would be
available in any judicial proceeding instituted to resolve an Arbitrable Claim.
Any judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction over the subject matter thereof.
(iii) COMPENSATION OF ARBITRATOR. The arbitrator will be
compensated for his or her services, as provided below in Section 2.3(c)(iv), in
accordance with the commercial arbitration rules of the American Arbitration
Association.
(iv) PAYMENT OF COSTS. The substantially prevailing party in
any arbitration shall be entitled to an award of attorneys' fees and costs, and
all costs of arbitration, including those provided for above, will be paid by
the losing party, subject in each case to a determination by the arbitrator as
to which party is the substantially prevailing party and the amount of such fees
and costs to be allocated to such party and subject to the terms of Section
2.3(c)(iii). Any amounts payable to Buyer by or on account of the Holder under
this subsection will be reimbursed as if the amount of such awarded fees and
expenses were an Uncontested Claim.
(v) TERMS OF ARBITRATION. The arbitrator chosen in
accordance with these provisions shall not have the power to alter, amend or
otherwise affect the terms of these arbitration provisions or the provisions of
this Escrow Agreement, the Agreement or any other documents that are executed in
connection therewith.
(vi) EXCLUSIVE REMEDY. Arbitration or mediation under this
Section 2.3(c) shall be the sole and exclusive remedy of the parties for any
Arbitrable Claim arising out of this Escrow Agreement.
3. RELEASE FROM ESCROW
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3.1 RELEASE OF ESCROW FUND. The Escrow Fund shall be released by the
Escrow Agent and Buyer as soon as practicable, taking into account the notices
to be delivered under this Section 3.1, after the first anniversary of the date
of this Escrow Agreement (the "RELEASE DATE") LESS: (a) any of the Escrow Fund
delivered to or deliverable to Buyer in satisfaction of Uncontested Claims or
Contested Claims which have been settled by the parties hereto, and (b) any of
the Escrow Fund subject to delivery to Buyer in accordance with Section 2.3(b)
with respect to any then pending Contested Claims. Within ten (10) of the Escrow
Agent's Business Days (as defined in Section 7.4) after the Release Date, Buyer
and the Holder shall deliver to the Escrow Agent a written notice jointly signed
(a "RELEASE NOTICE") setting forth the amount of the Escrow Fund to be released
by the Escrow Agent (the "RELEASED ESCROW") including the amount of the Escrow
Fund to be released to each Holder and the amount of the Escrow Fund to be
retained as provided in this Section 3.1 (the "RETAINED ESCROW"). Buyer and the
Holder shall make a good faith effort to agree on a reasonable portion of the
Escrow Fund to retain for pending Contested Claims and Prevailing Party Awards
and related expenses, which shall be an amount reasonably determined by Buyer to
cover the amount of the Contested Claim or Prevailing Party Award plus related
indemnifiable costs, but not to exceed two times the value of the Contested
Claim or Prevailing Party Award. Until such agreement is reached, or a
determination is made in accordance with Section 2.3(c), the remaining Escrow
Fund shall be the Retained Escrow. The Released Escrow shall be released to the
Holder in proportion to their respective interests in the Initial Escrow Shares.
In lieu of releasing any fractional Escrow Shares, any fraction of a released
Escrow Share that would otherwise be released shall be rounded to the nearest
whole Escrow Share. Promptly after receipt of the Release Notice, the Escrow
Agent shall deliver the Escrow Fund in accordance with the Release Notice. The
Escrow Agent shall not be required to xxxx
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such action until the Escrow Agent has received the Release Notice executed by
Buyer and the Holder or, in the event Buyer and the Holder fail to execute and
deliver a jointly approved Release Notice, a final award or decision which
specifies the distribution of the Escrow Fund.
3.2 RELEASE OF RETAINED ESCROW. Upon the resolution of Contested
Claims as provided for in Section 2.3(b), the Retained Escrow shall be subject
to release by the Escrow Agent to Buyer and/or to the Holder in accordance with
Section 2.3(b), this Section and as otherwise provided for in this Escrow
Agreement. The Escrow Agent and Buyer shall cause the transfer agent to transfer
to Buyer the number of Escrow Shares to be released to Buyer pursuant to Section
2.3(b) and reissue certificates for Escrow Shares that are to be either
distributed to the Holder pursuant to Section 3.1 or further retained by the
Escrow Agent pending the resolution of Contested Claims and/or Prevailing Party
Awards. Any Escrow Fund released from escrow to Buyer shall be subject to
cancellation by Buyer without requiring Buyer to pay any consideration
whatsoever in receipt thereof to the Company or any of the Holder, except in
satisfaction of the Claim.
3.3 EXPENSES OF HOLDER. The Holder shall be entitled to be reimbursed
his reasonable out-of-pocket expenses and the reasonable fees and disbursements
of counsel retained by him. Such reimbursements shall be treated as an
Uncontested Claim on a pro rata basis among the contributors to the Escrow Fund,
for all services performed pursuant to the Agreement and this Escrow Agreement;
provided, however, that payment of any Escrow Adjustment shall take priority
over payments to the Holder, as provided herein. The Escrow Agent shall follow
the joint written instructions of the Holder and Buyer concerning the release or
sale of Escrow Fund relating to the reimbursement of the Holder. If upon
termination of this Agreement, the Holder shall not have received the
reimbursements to which he is entitled hereunder, then the Holder shall be
entitled to reimbursement from the other Holder on a joint and several basis.
4. ESCROW AGENT
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4.1 ESCROW AGENT. The Escrow Agent undertakes to perform only such
duties as are expressly set forth herein and no duties shall be implied. The
Escrow Agent shall have no liability under and no duty to inquire as to the
provisions of any agreement other than this Escrow Agreement. The Escrow Agent
may rely upon and shall not be liable for 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 payments which may be due it. The Escrow
Agent shall not be liable for any action taken or omitted by it in good faith
except to the extent that a court of competent jurisdiction determines that the
Escrow Agent's gross negligence or willful misconduct was the primary cause of
any loss to the Buyer or Holder. The Escrow Agent may execute any of its powers
and perform any of its duties hereunder directly or through agents or attorneys
(and shall be liable only for the careful selection of any such agent or
attorney) and may consult with independent counsel and accountants to be
selected 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. In the event
that the Escrow Agent shall be uncertain as to its duties or rights hereunder or
shall receive instructions, claims or demands from any party hereto which, in
its opinion, conflict with any of the provisions of this Escrow Agreement, it
shall be entitled to refrain from taking any action and its sole obligation
shall be entitled to keep safely all property held in escrow until it shall be
directed otherwise in writing by all of the other parties hereto or by a final
order or judgment of a court of competent jurisdiction. Anything in this Escrow
Agreement to the
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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), even if the Escrow Agent has been
advised of the likelihood of such loss or damage and regardless of the form of
action.
4.2 SUCCESSION. The Escrow Agent may resign and be discharged from
its duties or obligations hereunder by giving 10 days advance notice in writing
of such resignation to the other parties hereto specifying a date when such
resignation shall take effect. Any corporation or association into which the
Escrow Agent may be merged or converted or with which it may be consolidated, or
any corporation or association to which all or substantially all the escrow
business of the Escrow Agent's corporate trust line of business may be
transferred, shall be the Escrow Agent under this Escrow Agreement without
further act.
4.3 FEES. The Buyer and the Holder agree to equally (i) pay the
Escrow Agent upon execution of this Escrow Agreement and from time to time
thereafter reasonable compensation for the services to be rendered hereunder,
which unless otherwise agreed in writing shall be as described in SCHEDULE 1
attached hereto, and (ii) pay or reimburse the Escrow Agent upon request for all
expenses, disbursements and advances, including reasonable attorney's fees and
expenses, incurred or made by it in connection with the preparation, execution,
performance, delivery, modification and termination of this Escrow Agreement.
Each party shall have a right of contribution against the other party to the
extent such party pays more than its 50% share of the expenses set forth in (i)
and (ii) of this Section 4.3.
4.4 INDEMNITY. The Buyer and the Holder shall jointly and severally
indemnify, defend and save harmless the Escrow Agent and its directors,
officers, agents and employees (the "indemnitees") from all loss, liability or
expense (including the fees and expenses of in house or outside counsel) arising
out of or in connection with (i) the Escrow Agent's execution and performance of
this Escrow Agreement, except in the case of any indemnitee to the extent that
such loss, liability or expense is due to the gross negligence or willful
misconduct of such indemnitee, or (ii) its following any instructions or other
directions from the Buyer or Holder, except to the extent that its following any
such instruction or direction is expressly forbidden by the terms hereof. The
parties hereto acknowledge that the foregoing indemnities shall survive the
resignation or removal of the Escrow Agent or the termination of this Escrow
Agreement. The parties hereby grant the Escrow Agent a lien on, right of set-off
against and security interest in the Escrow Fund for the payment of any claim
for indemnification, compensation, expenses and amounts due hereunder.
4.5 TINS. The Buyer and Holder each represent that its correct
Taxpayer Identification Number ("TIN") assigned by the Internal Revenue Service
or any other taxing authority is set forth in SCHEDULE 1. All interest or other
income earned under the Escrow Agreement shall be allocated to Holder in
proportion to Holder's interest in the Escrow Fund and reported by the Holder to
the Internal Revenue Service or any other taxing authority. Notwithstanding such
written directions, Escrow Agent shall report and, as required withhold any
taxes as it determines may be required by any law or regulation in effect at the
time of the distribution. In the event that any earnings remain undistributed at
the end of any calendar year, Escrow Agent shall report to the Internal Revenue
Service or such other authority such earnings as it deems appropriate or as
required by any applicable law or regulation or, to the extent consistent
therewith, as directed in writing by Buyer and the Holder. In addition, Escrow
Agent shall withhold any taxes it deems appropriate and shall remit such taxes
to the appropriate authorities.
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5. TERMINATION; DEFICIENCY CLAIMS
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This Escrow Agreement and the escrow created hereby shall terminate
following Escrow Agent's delivery, and the Holder's and Buyer's release of all
remaining Escrow Fund to the Holder and/or Buyer pursuant to Sections 2 or 3. In
the event that upon the termination of this Escrow Agreement, the value of the
Escrow Fund released to Buyer pursuant to the provisions of this Escrow
Agreement is insufficient to pay in full to Buyer the total amount of the
Damages and Prevailing Party Awards to which it is entitled, then Buyer shall be
entitled to pursue its remedies for any such deficiency under the Agreement;
provided, however, that no party hereto in connection with any such action may
contest any Uncontested Claim or any Contested Claim that has been resolved in
accordance with the provisions of this Escrow Agreement.
6. MISCELLANEOUS PROVISIONS
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6.1 PARTIES IN INTEREST. This Escrow Agreement is not intended, nor
shall it be construed, to confer any enforceable rights on any Person not a
party hereto. All of the terms and provisions of this Escrow Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of the parties hereto.
6.2 ATTORNEYS' FEES. In the event of any action to enforce any
provision of this Escrow Agreement by the Buyer or the Holder, or on account of
any default under or breach of this Escrow Agreement by the Buyer or the Holder,
the substantially prevailing party in such action shall be entitled to recover,
in addition to all other relief, from the other party all attorneys' fees
incurred by the substantially prevailing party in connection with such action
(including, but not limited to, any appeal thereof); provided, however that any
such fees shall not be duplicative of attorneys fees and expenses payable under
Section 2.3(c)(iv).
6.3 ENTIRE AGREEMENT. This Escrow Agreement constitutes the final and
entire agreement among the parties with respect to the subject matter hereof and
supersedes all prior arrangements or understandings.
6.4 All communications hereunder shall be in writing and shall be
deemed to be duly given and received:
(i) upon delivery if delivered personally or upon confirmed
transmittal if by facsimile; (ii) on the next Business Day (as hereinafter
defined) if sent by overnight courier; or (iii) four (4) Business Days
after mailing if mailed by prepaid registered mail, return receipt
requested, to the appropriate notice address set forth on Schedule 1 or at
such other address as any party hereto may have furnished to the other
parties in writing by registered mail, return receipt requested.
Notwithstanding the above, in the case of communications delivered to the Escrow
Agent pursuant to (ii) and (iii) of this Section 6.4, such communications shall
be deemed to have been given on the date received by the Escrow Agent. In the
event that the Escrow Agent, in its sole discretion, shall determine that an
emergency exists, the Escrow Agent may use such other means of communication as
the Escrow Agent deems appropriate. "BUSINESS DAY" shall mean any day other than
a Saturday,
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Sunday or any other day on which the Escrow Agent located at the notice address
set forth on SCHEDULE 1 is authorized or required by law or executive order to
remain closed.
6.5 SECURITY PROCEDURES. In the event Escrow Share transfer
instructions are given (other than in writing at the time of execution of this
Escrow Agreement), whether in writing, by telecopier or otherwise, the Escrow
Agent is authorized to seek confirmation of such instructions by telephone
call-back to the person or persons designated on SCHEDULE 2 hereto ("SCHEDULE
2"), and the Escrow Agent may rely upon the confirmation of anyone purporting to
be the person or persons so designated. The persons and telephone numbers for
call-backs may be changed only in a writing actually received and acknowledged
by the Escrow Agent. The Escrow Agent and the beneficiary any Escrow Share
transfer may rely solely upon any account numbers or similar identifying numbers
provided by the Buyer or Holder to identify such beneficiary. The Escrow Agent
may apply any of the Escrow Fund for any payment order it executes using any
such identifying number, even where its use may result in a person other than
the beneficiary being paid. The parties to this Escrow Agreement acknowledge
that these security procedures are commercially reasonable.
6.6 SEVERABILITY. If any term or provision of this Escrow Agreement
or the application thereof as to any Person or circumstance shall to any extent
be invalid or unenforceable, the remaining terms and provisions of this Escrow
Agreement or the application of such term or provision to persons or
circumstances other than those as to which it is held invalid or unenforceable
shall not be affected thereby and each term and provision of this Escrow
Agreement shall be valid and enforceable to the fullest extent permitted by law.
6.7 COUNTERPARTS. This Escrow Agreement may be executed in two or
more partially or fully executed counterparts, each of which shall be deemed an
original and shall bind the signatory, but all of which together shall
constitute but one and the same instrument. The execution and delivery of a
Signature Page to Escrow Agreement in the form annexed to this Escrow Agreement
by any party hereto who shall have been furnished the final form of this Escrow
Agreement shall constitute the execution and delivery of this Escrow Agreement
by such party.
6.8 HEADINGS. The headings of the various sections of this Escrow
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Escrow Agreement.
6.9 MISCELLANEOUS. The provisions of this Escrow Agreement may be
waived, altered, amended or supplemented, in whole or in part, only by a writing
signed by all of the parties hereto. Neither this Escrow Agreement nor any right
or interest hereunder may be assigned in whole or in part by any party, except
as provided in Section 6, without the prior consent of the other parties. This
Escrow Agreement shall be governed by and construed under the laws of the State
of California, except the rights, duties and obligations of the Escrow Agent
shall be governed by the laws of the State of New York. The parties further
hereby waive any right to a trial by jury with respect to any lawsuit or
judicial proceeding arising or relating to this Escrow Agreement. No party to
this Escrow Agreement is liable to any other party for losses due to, or if it
is unable to perform its obligations under the terms of this Escrow Agreement
because of, acts of God, fire, floods, strikes, equipment or transmission
failure, or other causes reasonably beyond its control.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10
Signature Page to Escrow Agreement
IN WITNESS WHEREOF, the parties have duly executed this Escrow Agreement as
of the day and year set forth on Schedule 1.
TERADYNE, INC.
PERCEPTION LAMINATES, INC.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx Xxxxxxx, Sr.
----------------------------------- --------------------------
Name: Xxxxxx X. Xxxxxxx Name: Xxxxxx Xxxxxxx, Sr.
Title: Vice President Title: President
HOLDER:
/s/ Xxxxxx Xxxxxxx, Sr.
--------------------------------------
Xxxxxx Xxxxxxx, Sr.
THE CHASE MANHATTAN BANK
AS ESCROW AGENT
By: /s/ Xxxx Xxx Xxxxxx
-----------------------------------
Authorized Signatory
