ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of April 1, 2002 (this "Escrow Agreement"),
by and among the HPI Indemnifying Stockholders listed on Schedule I attached
hereto (the "HPI Indemnifying Stockholders"), Xxx Enterprises, Incorporated, a
Delaware corporation (the "Purchaser"), and Xxxxx Fargo Bank Iowa, N.A., a
national banking corporation (the "Escrow Agent").
WITNESSETH:
WHEREAS, the HPI Indemnifying Stockholders and the Purchaser are parties
to an Acquisition Agreement dated as of February 11, 2002 (the "Acquisition
Agreement"), pursuant to which, among other things, the Purchaser is acquiring
from the HPI Indemnifying Stockholders on the date hereof certain issued and
outstanding shares of capital stock of Xxxxxx Publications, Inc., a Delaware
corporation (the "Company"); and
WHEREAS, the Acquisition Agreement requires the Purchaser to put into
escrow pursuant to this Escrow Agreement the sum of $50,000,000 (the "Escrow
Amount") to be held as security for the indemnification obligations of the HPI
Indemnifying Stockholders to the Purchaser pursuant to Article 8 of the
Acquisition Agreement; and
WHEREAS, the parties to this Escrow Agreement have agreed upon and wish
to set forth the terms and conditions with respect to the disposition of the
Escrow Amount held by the Escrow Agent.
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. Definitions. Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Acquisition Agreement, a
conformed copy of which has been delivered to the Escrow Agent.
2. Escrow Agent. The HPI Indemnifying Stockholders and the Purchaser
hereby designate and appoint the Escrow Agent to serve in accordance with the
terms, conditions and provisions of this Escrow Agreement, and the Escrow Agent
hereby agrees to act as such, upon the terms, conditions and provisions provided
in this Escrow Agreement.
3. Deposit of Escrow Amount. On even date herewith, the Purchaser shall
deposit with the Escrow Agent the Escrow Amount to be held in trust by the
Escrow Agent for the benefit of the HPI Stockholders in a separate trust account
(the "Escrow Account"), subject to the terms and provisions herein contained,
and the Escrow Agent shall promptly acknowledge receipt of such deposit to the
Purchaser and the HPI Indemnifying Stockholders. Subject to the right of the
Escrow Agent to resign as hereinafter provided, the Escrow Agent shall hold the
Escrow Amount placed in the Escrow Account, which shall not be disbursed except
as herein provided. The Escrow Amount shall be held by Escrow Agent as a trust
fund and such funds shall be maintained free of any lien or attachment of any
creditor of either party hereto and shall be used solely for the purposes and
subject to the conditions set forth herein.
4. Release of the Escrow Amount. The Escrow Amount shall be used only to
satisfy the indemnification obligations of the HPI Indemnifying Stockholders
under Article 8 of the Acquisition Agreement. As between the HPI Indemnifying
Stockholders and the Purchaser, the rights of, in and to the Escrow Amount shall
be governed by the Acquisition Agreement. The Escrow Agent shall release from
escrow hereunder and disburse the Escrow Amount only in accordance with the
provisions of this Section 4 set forth below.
(a) Purchaser Indemnity Claims. Upon the occurrence of an event which
the Purchaser in good faith asserts constitutes an event for which the HPI
Indemnifying Stockholders would be required to indemnify or make any payment to
the Purchaser pursuant to Article 8 of the Acquisition Agreement (a "Purchaser
Indemnity Claim"), whether paid or payable to the Purchaser or any third party,
the Purchaser shall furnish written notice of such event (the "Indemnity
Notice") to the HPI Indemnifying Stockholders and the Escrow Agent promptly (and
in any event within the time period specified in Section 8.3(a) of the
Acquisition Agreement), setting forth the Purchaser's then good-faith estimate
of the reasonably foreseeable amount of the Purchaser Indemnity Claim, and shall
immediately make available to the HPI Indemnifying Stockholders all relevant
information related to such Purchaser Indemnity Claim and which is in the
possession of the Purchaser or its Affiliates or representatives. Such Indemnity
Notice shall set forth in reasonable detail the facts upon which the Purchaser
Indemnity Claim is based as well as the specific provisions in the Acquisition
Agreement that entitle the Purchaser to indemnification.
(b) Purchaser Indemnity Claims Not Disputed by the HPI Stockholders
Representative. If, within twenty (20) Business Days after receipt of the
Indemnity Notice, the HPI Stockholders Representative does not give the notice
provided for in paragraph (c) of this Section 4, the Purchaser shall be entitled
to make a written demand upon the Escrow Agent (a copy of which shall be
provided to the HPI Stockholders Representative) that it retain for future
return to the Purchaser as and when the amount is finally determined, if the
amount is not then determined, or that it then disburse, within two (2) Business
Days of its receipt of such demand, to the Purchaser, if the amount has then
been finally determined, the full amount set forth in the Indemnity Notice (up
to the entire Escrow Amount).
(c) Purchaser Indemnity Claims Disputed by the HPI Stockholders
Representative in Whole. If the HPI Stockholders Representative disputes either
the Purchaser Indemnity Claim described in the Indemnity Notice or the amount
the Purchaser seeks as indemnity on account of such Purchaser Indemnity Claim,
the HPI Stockholders Representative shall, within twenty (20) Business Days
after its receipt of the Indemnity Notice, provide written notice to the Escrow
Agent and the Purchaser of such dispute, setting forth the basis therefor in
reasonable detail, based on its then good-faith belief. In the event the HPI
Stockholders Representative disputes the entire Purchaser Indemnity Claim, the
Escrow Agent shall not distribute any amount with respect thereto until the
Escrow Agent receives joint written instructions signed by the HPI Stockholders
Representative and the Purchaser stating the amount to which the Purchaser is
entitled in connection with such Purchaser Indemnity Claim, or a copy of an
order of any federal or state court sitting in Illinois (in any such case, the
"Court"), together with a joint written statement from Purchaser and HPI
Stockholders Representative that such order has become final and not subject to
appeal and has been certified by the clerk of such Court or other appropriate
official (collectively a "Final Judgment"), at which time the Escrow Agent shall
disburse, within two (2) Business Days of its receipt of such joint written
instructions or Final Judgment, to the Purchaser the amount set forth in such
joint written instructions or Final Judgment.
(d) Purchaser Indemnity Claims Disputed by the HPI Stockholders
Representative in Part. In the event the HPI Stockholders Representative
disputes part of, but not all of, a Purchaser Indemnity Claim, the Escrow Agent
shall, if the amount is undetermined, retain for future remittance to the
Purchaser, or, if the amount is finally determined, remit, within two (2)
Business Days of its receipt of the joint written instructions referred to in
subparagraph (c) above or of a Final Judgment to the Purchaser, the amount
attributable to that portion of the Purchaser Indemnity Claim which is not
disputed by the HPI Stockholders Representative up to the entire Escrow Amount.
The Escrow Agent shall not otherwise distribute any amount with respect to the
balance of such Purchaser Indemnity Claim except in accordance with the
procedures set forth in subparagraph (c) of this Section 4.
(e) Six-Month Reduction. On the date that is six (6) days after the
six-month anniversary of the Closing Date, the balance of the Escrow Amount on
such date shall be reduced to $35,000,000 (the "First Reduced Escrow Amount"),
unless on or prior to such date there are any unresolved Purchaser Indemnity
Claims for an amount, in the aggregate, that would exceed the then- contemplated
First Reduced Escrow Amount, in which case the Escrow Amount shall not be so
reduced. As unresolved Purchaser Indemnity Claims are resolved, the Escrow
Amount shall be reduced but not below the First Reduced Escrow Amount. Any
undisputed amounts in excess of the First Reduced Escrow Amount shall be
released from the provisions of this Escrow Agreement and distributed promptly
by the Escrow Agent to the HPI Indemnifying Stockholders in the proportions set
forth on Schedule I attached hereto; provided, however, that the amount that
otherwise would be so released and distributed shall be reduced by the Tax
Make-Whole Amount (as defined in Section 7(b) hereof), and at the time it
otherwise would be so distributed, the Tax Make-Whole Amount shall be released
to the Purchaser.
(f) Eighteen-Month Reduction. On the date that is the eighteen-month
anniversary of the Closing Date, the balance of the Escrow Amount on such date
shall be reduced to $15,000,000 (the "Second Reduced Escrow Amount"), unless on
or prior to such date there are any unresolved Purchaser Indemnity Claims for an
amount, in the aggregate, that would exceed the Second Reduced Escrow Amount, in
which case the Escrow Amount shall not be so reduced below the amount of
unresolved Purchaser Indemnity Claims. As unresolved Purchaser Indemnity Claims
are resolved, the Escrow Amount shall be reduced but not below the Second
Reduced Escrow Amount. Any undisputed amounts in excess of the Second Reduced
Escrow Amount shall be released from the provisions of this Escrow Agreement and
distributed promptly by the Escrow Agent to the HPI Indemnifying Stockholders in
the proportions set forth on Schedule I attached hereto; provided, however, that
the amount that otherwise would be so released and distributed shall be reduced
by the Tax Make-Whole Amount (as defined in Section 7(b) hereof), and at the
time it otherwise would be so distributed, the Tax Make-Whole Amount shall be
released to the Purchaser.
(g) Escrow Amount Expiration. (i) On or prior to the date that is the
third anniversary of the Closing Date (the "Expiration Date"), the Purchaser
shall furnish notice (the "Withholding Notice") to the Escrow Agent and the HPI
Indemnifying Stockholders of the amount, if any, to be retained on account of
Purchaser Indemnity Claims for which an Indemnity Notice has been provided
pursuant to this Section 4 and that have not been resolved or payment made with
respect thereto. Upon the receipt by the Escrow Agent of the Withholding Notice,
the Escrow Agent shall retain the amount set forth in the Withholding Notice. In
the event the Purchaser does not timely provide the Withholding Notice, the
remaining funds held in the Escrow Account shall be distributed by the Escrow
Agent to the HPI Indemnifying Stockholders in accordance with, and to the extent
provided in, clause (ii) below.
(ii) As soon as practicable following the Expiration Date, the balance,
if any, of the funds that would otherwise remain in the Escrow Account after
deduction of funds to be withheld pursuant to the provisions of clause (i)
above, shall be released from the provisions of this Escrow Agreement and
distributed promptly by the Escrow Agent to the HPI Indemnifying Stockholders in
the proportions set forth on Schedule I attached hereto; provided, however, that
the amount that otherwise would be so released and distributed shall be reduced
by the Tax Make-Whole Amount (as defined in Section 7(b) hereof), and at the
time it otherwise would be so distributed, the Tax Make-Whole Amount shall be
released to the Purchaser.
(iii) Upon receipt of the Withholding Notice, the Escrow Agent shall
continue to hold after the Expiration Date, with respect to each Purchaser
Indemnity Claim included in such Withholding Notice, the amount specified by
such notice until such time as the Escrow Agent receives joint written
instructions signed by the HPI Stockholders Representative and the Purchaser
stating the amount, if any, to which the Purchaser is entitled to receive from
the Escrow Account in connection with such Purchaser Indemnity Claim, or a copy
of a Final Judgment with respect to such Purchaser Indemnity Claim, at which
time the Escrow Agent shall remit, within two (2) Business Days of its receipt
of such joint written instructions or Final Judgment, to the Purchaser, with
respect to such Purchaser Indemnity Claim, the amount specified in such written
instructions or Final Judgment, and shall distribute to the HPI Indemnifying
Stockholders such funds, if any, which the Escrow Agent continued to hold after
the Expiration Date pursuant to clause (i) above by reason of such Purchaser
Indemnity Claim and which is in excess of the amount so distributed to the
Purchaser with respect thereto; provided, however, that, to the extent the
distribution of such excess funds from the Escrow Account to the HPI
Indemnifying Stockholders would cause the funds remaining in the Escrow Account
after such distribution to fall below the amount (as stipulated in the
Withholding Notice) of all still-unresolved Purchaser Indemnity Claims
identified in the Withholding Notice, such funds shall be retained by the Escrow
Agent in the Escrow Account and shall be available for distribution to the
Purchaser upon the resolution of any unresolved Purchaser Indemnity Claims, and
such funds shall not be distributed to the HPI Indemnifying Stockholders until
such time, if any, as such distribution can be made without causing the funds
remaining in the Escrow Account to fall below the amount of all remaining
unresolved Purchaser Indemnity Claims identified in the Withholding Notice.
5. Termination of Escrow Agreement. Upon payment and delivery by the
Escrow Agent of the entire balance of the cash in the Escrow Account as provided
above, or upon resignation of the Escrow Agent as provided below, this Escrow
Agreement shall terminate and the Escrow Agent shall be discharged from all
duties and liabilities hereunder.
6. Investment of Escrow Amount. Upon receipt of any deposit pursuant to
this Escrow Agreement, Escrow Agent shall invest said deposit in accordance with
written direction from the HPI Stockholders Representative. If no investment
direction is received, Escrow Agent shall invest any moneys held in the Escrow
Account from time to time in the Xxxxx Fargo 100% Treasury or Xxxxx Fargo
Government Service Money Market funds.
7. Investment Income. (a) All income, interest, increments and gains of
all kinds from the Escrow Amount or other amounts held in the Escrow Account
("Earnings") shall be held in the Escrow Account applicable to such amount to be
released in accordance with Section 4 above, as applicable, it being understood
that upon such release said Earnings shall be paid to the HPI Indemnifying
Stockholders or the Purchaser, as applicable, in proportion to the amount, if
any, of the Escrow Amount to be paid to them. The Purchaser shall be solely
responsible for all Taxes in respect of any Earnings and all tax reporting filed
by the Escrow Agent shall name Purchaser as the recipient of any Earnings for
tax reporting purposes. The Purchaser agrees to treat all amounts held in the
Escrow Account, unless and until such amounts are distributed to the HPI
Indemnifying Stockholders under Section 5 (or, in the case of Earnings, this
Section 7), as owned by the Purchaser for all income and other Tax purposes. For
all Tax purposes, the HPI Indemnifying Stockholders and Purchaser hereto agree
to treat each distribution to the HPI Indemnifying Stockholders under Section 5
(or, in the case of Earnings, this Section 7), as an adjustment to the purchase
price paid by the Purchaser for the HPI Common Stock in the Stock Purchase
(except to the extent treated as imputed interest for such purposes). The HPI
Indemnifying Stockholders and Purchaser hereto intend that payments to the HPI
Indemnifying Stockholders hereunder shall be treated for federal income Tax
purposes as consisting in part as imputed interest (or original issue discount)
deductible by the Purchaser and includible in income by the HPI Indemnifying
Stockholders (in each case, in the year of payment) using, to the extent
applicable, the concepts of Section 1272 through 1275 and Section 483 of the
Code and applicable Treasury Regulations (the "Intended Tax Treatment"). The
Purchaser and the HPI Indemnifying Stockholders will take no position for tax
purposes inconsistent therewith, and, each party agrees that it will report such
imputed interest in accordance with the Intended Tax Treatment.
(b) If with respect to a distribution (if any) to the HPI Indemnifying
Stockholders pursuant to Section 4 hereof there is a final determination (as
described below) that the Purchaser is not entitled to such deduction in
accordance with the Intended Tax Treatment, then the Tax Make-Whole amount
referred to in Section 4 shall equal thirty-nine percent (39%) times the excess
of the amount of imputed interest that was intended to be deductible over the
amount of imputed interest for which the Purchaser is entitled to claim a
deduction. A final determination means either an opinion by tax counsel,
selected by Purchaser and reasonably acceptable to HPI Indemnifying
Stockholders, stating that there is no "substantial authority" (as determined
under Section 6662 of the Code) supporting such deduction, or a final and
binding determination by an administrative body or court concluding that
Purchaser is not entitled to such deduction. Any disputes regarding the
calculation of the amount described in the first sentence of this subparagraph
(b) shall be made by an accounting firm mutually acceptable to the Purchaser and
the HPI Stockholders Representative. The Purchaser and the HPI Stockholders
Representative shall promptly notify the Escrow Agent when the final
determination is made of the Tax Make-Whole amount, if any, to be paid by the
Escrow Agent to the Purchaser.
8. Responsibilities of the Escrow Agent. (a) The Escrow Agent shall have
no duties nor responsibilities except those expressly set forth herein. The
Escrow Agent shall have no responsibility for the validity, performance or
interpretation of any agreements referred to in this Escrow Agreement. The
Escrow Agent's liability is limited to bad faith, willful misconduct or gross
negligence on its part. The Escrow Agent shall be protected in acting upon any
certificate, notice or other instrument whatsoever received by it under this
Escrow Agreement, not only as to its due execution and validity, but also as to
the truth of the information contained therein which the Escrow Agent in good
faith believes to be genuine.
(b) The Escrow Agent is acting only with respect to the Escrow Amount.
If any controversy arises involving any party to this Escrow Agreement as to any
matter arising out of or relating to this Escrow Agreement, the Escrow Agent
shall not be required to determine same and shall have the right to cease any
disbursement of the Escrow Amount or any portion thereof, but in such event the
Escrow Agent shall retain the same until receipt by the Escrow Agent (i) of
joint instructions in writing, signed by the HPI Stockholders Representative and
the Purchaser, directing the disposition of the Escrow Amount in question, or
(ii) of a Final Judgment providing for the disposition of the Escrow Amount in
question.
(c) In the event of any uncertainty of the Escrow Agent as to its duties
or rights hereunder or any receipt of instructions from any of the undersigned
relating to any Escrow Account which, in the opinion of the Escrow Agent,
conflicts with any of the provisions of this Escrow Agreement, the Escrow Agent
may refrain from any action until directed otherwise in joint writing by the HPI
Stockholders Representative and the Purchaser or a Final Judgment. This Escrow
Agreement sets forth the entire agreement among the parties hereto and the
Escrow Agent as escrow agent. Notwithstanding any provision to the contrary in
any other agreement (excluding any amendment to this Escrow Agreement) between
the parties hereto, the Escrow Agent shall have no interest in any Escrow Amount
except as provided in this Escrow Agreement. The terms of this Escrow Agreement
shall govern and control in all respects in the event of any conflicts or
inconsistent provisions in any other agreement (excluding any amendment to this
Escrow Agreement).
(d) The Escrow Agent shall not be obligated to risk its own funds in the
administration of any Escrow Account. The Escrow Agent need not take any action
under this Escrow Agreement which may involve it in the expense or liability
until indemnified by the HPI Indemnifying Stockholders and the Purchaser
pursuant to Section 11 hereof for any expense or liability it reasonably
believes it may incur.
(e) Any recitals contained in this Escrow Agreement shall be deemed to
be those of the HPI Indemnifying Stockholders and the Purchaser and not those of
the Escrow Agent.
(f) The Escrow Agent may engage legal counsel to review this Escrow
Agreement and any question as to any of the provisions hereof or its duties
hereunder, and the Escrow Agent shall not be liable for any act or omission
taken or suffered pursuant to the opinion of such counsel, so long as such
action or conduct does not constitute gross negligence or willful misconduct on
the part of the Escrow Agent. The reasonable fees and expenses of such counsel
shall be deemed to be a proper expense and shall be added to and be a part of
the Escrow Agent's fee hereunder.
(g) Unless specifically required by the terms of this Escrow Agreement,
the Escrow Agent shall not take notice of or enforce any other document or
relationship, including, without limiting the generality of the foregoing, any
contract, settlement, arrangement, plan, assignment, pledge, release, decree or
the like, and its duties shall be solely as set forth in this Escrow Agreement.
(h) As promptly as practicable following the disbursement of any funds
of any Escrow Account, the Escrow Agent shall send a written statement to each
of the HPI Stockholders Representative and Purchaser stating the amount of the
disbursement and the amounts remaining in the Escrow Account.
9. Amendment and Cancellation. The Escrow Agent shall not be bound by
any cancellation, waiver, modification, rescission or amendment of this Escrow
Agreement, including the transfer of any interest hereunder, unless such
modification is in writing and signed by the HPI Stockholders Representative and
the Purchaser and, if the duties of the Escrow Agent hereunder are affected,
unless the Escrow Agent also shall have given its written consent thereto.
10. Resignation. The Escrow Agent shall have the right, in its
discretion, to resign as agent and escrowee hereunder at any time by giving at
least thirty (30) days' prior written notice of such resignation to the HPI
Indemnifying Stockholders and the Purchaser. In such event, the HPI Indemnifying
Stockholders and the Purchaser will promptly select another bank having capital,
surplus and undivided profits of not less than $1,000,000,000, which bank will
be appointed as successor Escrow Agent, and will enter into an agreement with
such other bank in substantially the form of this Escrow Agreement. Resignation
by the Escrow Agent and acceptance by a substitute of its duties hereunder shall
relieve the Escrow Agent of any responsibility or duty thereafter arising
hereunder, but shall not relieve the Escrow Agent of responsibility to account
to the HPI Indemnifying Stockholders and the Purchaser for funds received by the
Escrow Agent from the Purchaser prior to the effective date of such resignation.
If a successor Escrow Agent hereunder shall not have been selected, as aforesaid
within the aforesaid 30-day period, the Escrow Agent shall be entitled to
petition the Court for the appointment of a successor for it hereunder or, in
the alternative, it may transfer and deliver the funds deposited in the Escrow
Account to or upon the order of the Court. The Escrow Agent shall be discharged
from all further duties hereunder upon acceptance by the substitute of its
duties hereunder or upon transfer and delivery of the funds in the Escrow
Account to or upon an order of the Court.
11. Fees. The Purchaser and the HPI Indemnifying Stockholders shall pay
the Escrow Agent compensation (as payment in full) for the services to be
rendered by the Escrow Agent hereunder in accordance with the Fee Schedule
attached hereto and agree to reimburse the Escrow Agent for all reasonable
expenses, disbursements and advances incurred or made by the Escrow Agent in
performance of its duties hereunder (including reasonable fees, expenses and
disbursements of its counsel). Any such compensation, reimbursements and
indemnification to which the Escrow Agent is entitled shall be borne 50% by the
Purchaser and 50% by the HPI Indemnifying Stockholders.
12. Payments. If at any time the Escrow Agent is required to distribute
or pay over any amounts held by or received by it under any of the provisions of
this Escrow Agreement, such distribution and payment shall be effected in the
appropriate amount in cash by wire transfer in immediately available funds to
such account or accounts designated by the recipient of the Escrow Account.
13. Notices. All notices and other communications hereunder and
disbursements required pursuant hereto shall be addressed to the Escrow Agent,
the HPI Indemnifying Stockholders, the HPI Stockholders Representative and the
Purchaser respectively, as follows:
If to the Escrow Agent:
Xxxxx Fargo Bank Iowa, N.A.
Corporate Trust Services
MAC N8200-034
000 Xxxxxx Xx., X.X. Xxx 000
Xxx Xxxxxx, XX 00000-0000
Attn: Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to the HPI Indemnifying Stockholders or the HPI Stockholders
Representative:
Xxxxxx Energy Co., Inc.
00000 Xxxx Xxx Xxxxx, Xxxxx 0000
Xxxxxxxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
Telephone: (000)000-0000
Facsimile: (000)000-0000
with copies to:
Sidley Xxxxxx Xxxxx & Xxxx
Bank One Plaza
00 X. Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
- and -
Xxxxx, Xxxxxxxxx & Mines, P.S.
Xxx Xxxxxxxxxx Xxxxx, Xxxxx 0000
000 Xxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
If to the Purchaser:
Xxx Enterprises, Incorporated
400 Xxxxxx Building
000 X. Xxxx Xx.
Xxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx, Chairman, President and CEO
Telephone: (000)000-0000
Facsimile: (000)000-0000
with a copy to:
Lane & Xxxxxxxx
000 X. Xxxx Xx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: C. Xxxx Xxxxxxxx III, Esq.
Telephone: (000)000-0000
Facsimile: (000)000-0000
All notices and other communications required or permitted under this
Escrow Agreement shall be in writing and shall be deemed given (a) when
delivered personally, (b) on the third Business Day after being mailed by
certified mail, return receipt requested, (c) the next Business Day after
delivery to a recognized overnight courier, or (d) upon transmission and
confirmation of receipt by a facsimile operator if sent by facsimile (and shall
also be transmitted by facsimile to the Persons receiving copies thereof), to
the parties at the above addresses or facsimile numbers (or to such other
address and facsimile number as a party may have specified by notice given to
the other party pursuant to this provision).
14. Parties in Interest. This Escrow Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
executors, administrators, successors and assigns. Nothing in this Escrow
Agreement, express or implied, shall give to anyone, other than the parties
hereto and their respective permitted successors and assigns, any benefit, or
any legal or equitable right, remedy or claim, under or in respect of this
Escrow Agreement or the escrow contemplated hereby. The Purchaser may assign
this Agreement or any or all rights or obligations hereunder to any wholly-owned
corporate subsidiary of the Purchaser formed under the laws of any state in the
United States of America. Upon any such permitted assignment, the references in
this Agreement to the Purchaser shall also apply to any such assignee unless the
context otherwise requires. The interest of an HPI Indemnifying Stockholder
under this Escrow Agreement shall be nontransferable except by operation of law.
15. Captions. The section and paragraph captions used herein are for
reference purposes only, and shall not in any way affect the meaning or
interpretation of this Escrow Agreement.
16. Execution by Escrow Agent. The execution of this Escrow Agreement by
the Escrow Agent shall constitute a receipt for the Escrow Amount and shall
evidence its acceptance and agreement to the terms hereof.
17. Indemnification of Escrow Agent. The HPI Indemnifying Stockholders
and the Purchaser jointly and severally agree to hold the Escrow Agent harmless
and to indemnify the Escrow Agent against any loss, liability, claim or demand
arising out of or in connection with the performance of its obligations in
accordance with the provisions of this Escrow Agreement including, without
limitation, any tax penalty or other tax-related liability incurred by the
Escrow Agent in connection with the tax treatment and tax reporting contemplated
in Section 7 hereto, except for gross negligence, bad faith or willful
misconduct of the Escrow Agent. The foregoing indemnities in this Section 17
shall survive termination of this Escrow Agreement.
18. Governing Law. This Escrow Agreement shall be construed and enforced
in accordance with the laws of the State of Illinois.
19. Counterparts. This Escrow Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Escrow Agreement
shall become effective immediately upon the exchange of executed signature
pages, which may be by facsimile.
20. Set-Off. The Escrow Agent waives any right, arising at law or
otherwise, to set off or to appropriate and apply any and all amounts at any
time held or owing by the Escrow Agent hereunder to or for the credit or the
account of any of the parties hereto against or on account of any obligation or
liability of any or the parties hereto to the Escrow Agent whether or not
arising under this Escrow Agreement.
IN WITNESS WHEREOF, the parties hereunder have duly caused this Escrow
Agreement to be executed as of the date and year first above written.
XXXXX FARGO BANK IOWA, X.X. XXX ENTERPRISES, INCORPORATED
By: /s/ Xxxxx XxXxxxxx By: /s/ Xxxx X. Xxxxxxx
----------------------------- ---------------------------------------
Xxxxx XxXxxxxx Xxxx X. Xxxxxxx
Vice President Vice President, Chief Financial Officer
and Treasurer
XXXXXX PUBLICATIONS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------------
Xxxxxxx X. Xxxxxx
President
HPI INDEMNIFYING STOCKHOLDERS
/s/ Xxxxxx X. Xxxxxx /s/ Xxxxxx X. Xxxxxx
----------------------------------- --------------------------------------
Xxxxxx X. Xxxxxx Xxxxxx X. Xxxxxx
/s/ Xxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
----------------------------------- --------------------------------------
Xxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx
/s/ Xxxxxx X. Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
Schedule I
HPI Indemnifying Stockholders Indemnification Proportions
Xxxxxx X. Xxxxxx 44%
Xxxxx X. Xxxxxx 15%
Xxxxxx X. Xxxxxx 14%
Xxxxxxx X. Xxxxxx 13%
Xxxxxx X. Xxxxxx 14%
EXHIBIT A
XXXXX FARGO BANK IOWA, N.A.
CORPORATE TRUST SERVICES
SCHEDULE OF FEES
FOR ESCROW AGENT SERVICES
INITIAL: $ 500
Initial Fees include creation and examination of the Escrow Agreement;
acceptance of the Escrow appointment; setting up of an Escrow Account and
accounting records; and the coordination of receipt of funds for deposit to the
Escrow Account. Initial Fee is payable at the time of execution of the Escrow
Agreement.
ANNUAL ADMINISTRATION: $1,500
For ordinary services of the Escrow Agent, including normal administration of
the Escrow Account. Ordinary services include: daily routine account management;
cash transaction processing, including wires and check processing (per the
schedule indicated below); disbursement of funds in accordance with the
Agreement; and trust account statements sent to applicable parties. Payable
annually in advance (except for transaction costs as detailed below). This fee
will not be prorated in case of early termination. The annual administration fee
does not include fees for unusual or extraordinary services which will be passed
through to the parties as an extraordinary expense. Tax reporting is included.
All fees shall be received prior to closing of the Escrow Account.
TRANSACTION FEES:
These fees will accrue in addition to the ordinary annual administrative charge,
billed annually in arrears.
For cash disbursement in excess of 1 per month $25 each
Purchase, sale or maturity of securities
(No fees will be incurred for investment in, or sale from a
Xxxxx Fargo sweep fund). $25 each
THIS SCHEDULE IS SUBJECT TO PERIODIC REVIEW
