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EXHIBIT 10.45
ESCROW AGREEMENT
This ESCROW AGREEMENT (the "Escrow Agreement") dated as of June
10, 1998, by and among Sage Networks Acquisition Corp., a Delaware corporation
(the "Buyer"), HomeCom Communications Inc., a Delaware corporation (the
"Seller") and Xxxx Xxxx Xxxxx & Xxxxx LLP, a Georgia limited liability
partnership, ("Escrow Agent") (Buyer and Seller collectively referred to herein
as "Depositors").
WHEREAS, Buyer and Seller have entered into the Asset Purchase
Agreement (the "Purchase Agreement") dated June 10, 1998 pursuant to which
certain amounts are to be deposited into an escrow account; and
WHEREAS, Buyer and Seller desire to enter into this Agreement to
provide for such escrow account and the terms and conditions applicable thereto;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants hereinafter set forth, the parties hereto agree as follows:
Section 1. ESTABLISHMENT OF ESCROW ACCOUNT. A special escrow
account shall be created and established by the Escrow Agent at the firm's
escrow account which is currently maintained at Wachovia Bank, N.A. which will
at all times be invested in direct obligations of the United States government
or otherwise invested as set forth in Section 4 hereof. Such account shall be
separate and apart from all other funds of Sellers and Buyer and shall be
designated as the "Escrow Account".
Section 2. DEPOSIT. (a) Upon execution of this Agreement by all
of the parties hereto, Buyer has deposited $250,000 in cash with the Escrow
Agent, and Escrow Agent hereby acknowledges receipt of such amount.
(b) For purposes of this Agreement, the cash amount deposited
under Subsection 2 hereof (the "Deposit Amount") together with accruals thereon
pursuant to Section 3 below, are referred to hereinafter as "Escrow Property".
Section 3. ACCRUAL ON ESCROW PROPERTY. Escrow Agent shall collect
all dividends, principal, interest, and any other payment or distribution on the
Deposit Amount (and any amounts accruing in respect thereof), and shall pay the
same as received to Seller but at least once per month.
Section 4. INVESTMENT BY ESCROW AGENT. From the date of deposit
hereunder until the termination of this Agreement, the Escrow Property shall
promptly be fully invested by Escrow Agent as directed by Seller from time to
time solely in direct obligations of, or obligations guaranteed as to all
principal and interest by, the United States of America, in each case with
maturity dates of 91 days or less and in no event maturing later than 1 year
following the Closing Date.
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Temporarily uninvested funds held hereunder shall be held in a
money market savings account established for that purpose or otherwise as
directed by Seller; provided, that the Depositors may direct Escrow Agent by
joint written instruction that such funds should thenceforth be held available
for immediate distribution, without the earning or accrual of interest thereon.
Section 5. REPORTING BY ESCROW AGENT. Escrow Agent shall furnish
to the Depositors monthly itemized summaries of the property held as Escrow
Property in the form of bank or similar account statements, including all
transactions made with respect to the Escrow Property from and after the date
hereof, all transactions made pursuant to Sections 3 and 4 hereof and all
distributions made pursuant to Section 7 hereof.
Section 6. DISTRIBUTION. Except as otherwise directed in writing
by the Depositors or as provided in Section 7 hereof, the Escrow Agent shall
release from escrow and distribute the Escrow Property to Seller on May 1, 1999.
Section 7. CONDITIONS TO DISBURSEMENT OF ESCROW PROPERTY. (a)
Except as otherwise provided in Section 6, upon (i) receipt by Escrow Agent of
written notice from Buyer, certifying that there exists certain conditions or
facts (which conditions or facts are to be specified in reasonable detail) which
under the Purchase Agreement entitle the Buyer to receipt of the Escrow Property
or any portion thereof from Escrow Agent; (ii) notification within five (5)
business days by Escrow Agent to the Seller of the notice received from the
Buyer which Escrow Agent shall give promptly upon receipt of Buyer's notice; and
(iii) a failure by Escrow Agent to receive by registered or certified mail
within ten (10) business days after receipt by the Seller of the Escrow Agent's
notification to the Seller, a written notice and certification from the Seller
of the non-existence of or disagreement with respect to the conditions or facts
certified by the Buyer, then Escrow Agent shall disburse to the Buyer, the
Escrow Property or the portion thereof designated in the notice and
certification referenced in clause (i) above. Escrow Agent may (but shall not be
required to) require as a condition to any such release of Escrow Property that
it be presented with satisfactory evidence of the satisfaction of such
conditions, which may include a certificate signed by each of the Depositors to
the effect that such conditions have been fulfilled. Any delivery made pursuant
to this paragraph shall not be deemed to prejudice any party's right to claim
that the Escrowed Property are owing to such party.
(b) If Escrow Agent does receive a notice and certificate from
the Seller as described in Section 7(a) above unless Escrow Agent resigns
pursuant to Section 9(a) or 9(c) herein or the Escrow Agent is removed pursuant
to Section 9(b), then Escrow Agent shall hold the disputed amount in escrow
until settlement of the controversy by a court of competent jurisdiction, by an
arbitrator designated in writing by both of the parties or by joint written
instructions from both parties.
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(c) Escrow Agent shall be permitted to disburse the Escrow
Property or a portion thereof in accordance with a final order, judgment or
decree of such court or arbitrator or in accordance with joint written
instructions from Seller and Buyer, as the case may be; provided, however, that
in the case of a final order, judgment or decree of a court of competent
jurisdiction, Escrow Agent shall not release any portion of the Escrow Property
until it receives from the party requesting release of the Escrow Property an
opinion of counsel to the effect that such order, judgment or decree represents
a final adjudication of such party's rights to that portion of the Escrow
Property in dispute and that the time for an appeal from such order, judgment or
decree has expired without an appeal having been perfected.
(d) Upon distribution of all the Escrow Property pursuant to
Depositors' instructions, the Escrow Agent shall be discharged from all
obligations under this Agreement and shall have no further duties or
responsibilities in connection herewith.
(e) The party that is entitled to the payment of any disputed
amount held pursuant to the Escrow Agreement shall be entitled to recover
reasonable attorney's fees and expenses actually incurred in connection with
prosecuting such claim from the party that is not entitled to such payment.
(f) In the event Escrow Agent is notified or becomes aware of any
disagreement between the Depositors with respect to the Escrowed Property,
Escrow Agent shall be entitled (but not required), at its option, to refuse to
comply with any notice, demand or other requirement hereof and may continue to
hold the Escrowed Property in escrow so long as such disagreement shall
continue; and, in so doing, Escrow Agent shall not become liable in any way to
any person for its failure or refusal to comply with any such notice or demand
until (i) either (A) the Depositors have settled or compromised their
disagreements, or (B) such disagreements have been fully adjudicated, and (ii)
Escrow Agent shall have been so notified in a writing signed by both Depositors.
It shall be the responsibility of the Depositors to notify the Escrow Agent of
any dispute, disagreement or other relevant matter between the Depositors with
respect to the Escrowed Property.
(g) In the event that such disagreements between the Depositors
shall not have been so settled, compromised or adjudicated within ten (10) days
following receipt by Escrow Agent of knowledge of the existence of such
disagreement, Escrow Agent may, but shall not be obligated to, interplead all
the Escrowed Property then held in escrow into a court of proper jurisdiction,
and thereupon Escrow Agent shall be fully and completely discharged of its
duties as Escrow Agent hereunder.
(h) It is agreed that the Escrow Agent shall act as a depository
only and shall not, except as expressly stated herein, be required to take
notice of any default or breach of warranty, representation, covenant or
agreement of any party contained in this Agreement or any other agreement
between the Depositors or their respective affiliates.
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(i) Each Depositor agrees to pay one-half of Escrow Agent's
reasonable and customary fees (if any) for its services hereunder and to
reimburse the Escrow Agent for one-half of its reasonable expenses and
disbursements incurred in the performance of such services.
Section 8. RESPONSIBILITIES OF ESCROW AGENT.
(a) Escrow Agent shall exercise the same degree of care toward
the Escrow Property as it exercises toward its own similar property and shall
not be held to any higher standard of care under this Agreement, nor deemed to
owe any fiduciary duty to the Depositors.
(b) Escrow Agent shall be obligated to perform only such duties
as are expressly set forth in this Agreement. No implied covenants or
obligations shall be inferred from this Agreement against Escrow Agent, nor
shall Escrow Agent be bound by the provisions of any agreement among the
Depositors beyond the specific terms hereof.
(c) Escrow Agent shall not be liable hereunder except for its own
gross negligence or willful misconduct and the Depositors jointly and severally
each agree to indemnify Escrow Agent for and hold it harmless as to any loss,
liability, or expense, including court costs and reasonable attorney fees,
incurred on the part of Escrow Agent and arising out of or in connection with
Escrow Agent's duties under this Agreement, except for any such loss, liability
or expense arising out of or in connection with Escrow Agent's gross negligence
or willful misconduct. Escrow Agent shall be entitled to advancement of any such
costs and expenses from the Depositors.
(d) Subject to Section 7(c) hereof, Escrow Agent shall be
entitled to rely upon any reasonable order, judgment, certification,
instruction, notice or other writing delivered to it in compliance with the
provisions of this Agreement without being required to determine the
authenticity or the correctness of any fact stated therein or the propriety or
validity thereof. Escrow Agent may act in reliance upon any instrument or
signature believed by it to be genuine and comporting with the provisions of
this Agreement and may assume that any person purporting to give notice or
receipt or advice or make any statement or execute any document in accordance
with the provisions hereof has been duly authorized to do so.
(e) At any time Escrow Agent may request in writing an
instruction in writing from the Depositors, and may at its own option include in
such request the course of action it proposes to take and the date on which it
proposes to act, regarding any matter arising in connection with its duties and
obligations hereunder and which is required by applicable law. Escrow Agent
shall not be liable for any action taken in accordance with such proposed course
of action without the Depositors' consent on or after the date specified in
Escrow Agent's request for instructions, provided that (i) the specified date
shall be at least five (5) business days after each Depositor has received
Escrow Agent's
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request for instructions and its proposed course of action, and (ii) prior to so
acting, Escrow Agent has not received the written instructions requested.
Notwithstanding anything to the contrary in Section 14 hereof, Escrow Agent's
request shall not be deemed to have been received by the Depositors until the
date of actual receipt.
(f) Escrow Agent may consult with, and obtain advice from, legal
counsel chosen by Escrow Agent in the event of any question as to any of the
provisions of this Agreement or the duties hereunder, and Escrow Agent shall,
except in the case of gross negligence or willful misconduct, incur no liability
and shall be fully protected in acting in good faith in accordance with the
written opinion and instructions of such counsel.
(g) Escrow Agent does not have any interest in the Escrow
Property deposited hereunder but is serving as escrow holder only and has only
possession thereof.
(h) In the event of ambiguity in the provisions governing the
Escrow Property or uncertainty on the part of Escrow Agent as to how to proceed,
Escrow Agent may refrain from taking any action other than to retain custody of
the Escrow Property deposited hereunder until it shall have received joint
written instructions signed by each Depositor; provided, that Escrow Agent, in
its sole and absolute discretion, deems it necessary for its protection to so
refrain. Escrow Agent shall promptly notify each Depositor of its decision to
refrain from taking any action in reliance on this Section 8(h).
Section 9. RESIGNATION OR REMOVAL OF ESCROW AGENT.
(a) Escrow Agent may resign at any time by giving written notice
thereof to each Depositor, but its resignation shall not become effective until
a successor escrow agent shall have been appointed by mutual agreement of the
Depositors and shall have accepted such appointment in writing. Until a
successor escrow agent is appointed by the Depositors and accepts such
appointment, the Escrow Agent's only duty hereunder shall be to hold any
then-remaining Escrow Funds in accordance with the original provisions of this
Escrow Agreement. Escrow Agent shall, upon receipt of the joint written
instructions of each Depositor, distribute the Escrow Property to such successor
escrow agent.
(b) The Depositors may remove Escrow Agent upon written notice to
Escrow Agent signed by each Depositor. Such removal shall take effect upon
delivery of the Escrow Property to a successor escrow agent designated in joint
written instructions signed by each Depositor, and Escrow Agent shall thereupon
be discharged from all obligations under this Agreement and shall have no
further duties or responsibilities in connection herewith. Escrow Agent shall
deliver the Escrow Property without unreasonable delay after receiving the
Depositors' designation of such successor escrow agent.
(c) If a successor escrow agent has not been appointed or has not
accepted such appointment within 30 calendar days after notice of resignation or
removal is given
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hereunder, Escrow Agent may petition any court of competent jurisdiction for the
appointment of a successor escrow agent. The reasonable costs, expenses and
attorney's fees which Escrow Agent incurs in connection with such a proceeding
shall be paid one-half by Buyer and one-half by Seller. Until a successor escrow
agent is appointed by the Depositors or such a court, as the case may be, Escrow
Agent shall continue to hold the Escrow Property in accordance with the terms of
this Agreement.
Section 10. CHOICE OF LAW AND JURISDICTION. This Agreement shall
be governed by and construed in accordance with the laws of the State of
Georgia. Venue for any dispute arising from or relating to this Agreement shall
lie in the state and federal courts of Xxxxxx County, Georgia. Whenever possible
each provision of this Escrow Agreement shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited or invalid under such law, such provision shall be
deemed severed herefrom and ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
Section 11. BENEFITS AND ASSIGNMENT. Nothing in this Agreement,
expressed or implied, shall give or be construed to give any person, firm or
corporation, other than the parties hereto and their successors and permitted
assigns, any legal claim under any covenant, condition or provision hereof, all
the covenants, conditions and provisions contained in this Agreement being for
the sole benefit of the parties hereto and their successors and permitted
assigns. No party may assign any of its rights or obligations under this
Agreement to any person other than an affiliate thereof without the written
consent of all the other parties, which consent may be withheld in the sole
discretion of the party whose consent is sought.
Section 12. AMENDMENT. This Agreement may be modified only by a
written amendment signed by all the parties hereto.
Section 13. HEADINGS. The headings contained in this Agreement
are for convenience of reference only and shall have no effect on the
interpretation or operation hereof.
Section 14. NOTICES. Except as specified in Section 8(e), all
notices and other communications hereunder shall be in writing and deemed to
have been duly given when delivered by hand, upon receipt when mailed by
registered or certified mail, postage prepaid, return receipt requested, when
received if sent by prepaid courier delivery services such as Federal Express,
DHL or other similar services, or when given by facsimile transmission upon
receipt by sender of confirmed answer-back, as follows:
(a) if to Buyer, at
Sage Networks, Inc.
000 Xxxxx Xxxxxx - 0xx Xxxxx D-Wing
Cambridge, Mass. 02142
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Attention: Xxxxx Xxxxxxxx
Telecopier No.: 000-000-0000
with a copy to:
Xxxxx Xxxxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, X.X. 00000
Attention: E. Xxx Xxxx, Esq.
Telecopier No.: (000) 000-0000
and
Sage Networks Acquisition Corp.
c/x XxXxxxxx, Finger, Xxxxxxx, Xxxxxx & Xxxxx LLP
00 Xxxxxxx Xxxxxx
Xxxxx Xxxxxx, XX 00000-0000
Attn: Xxxxx Xxxxx, Esq.
(b) if to the Seller, at:
HomeCom Communications, Inc.
00 Xxxxxxxx Xxxxxx, Xxxxx 000
0000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxx
Telecopier No.:
with a copy to:
Xxxx Xxxx Xxxxx & Xxxxx XXX
Xxxxx 000
000 Xxxxxxxxx Xxxx Center
0000 Xxxxxxxxx Xxxx XX
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxx, Esq.
Telecopier No. (000) 000-0000
(c) If to Escrow Agent:
Xxxx Moss Kline & Xxxxx LLP
000 Xxxxxxxxx Xxxx Xxxxxx - Xxxxx 000
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Telecopier No.: (000) 000-0000
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Each of the parties may, by notice given as aforesaid, change its
address for all subsequent notices.
Section 15. FURTHER ASSURANCES. In case at any time any further
action is necessary or desirable to carry out the purposes of this Agreement,
each of the parties hereto will take such further action (including the
execution and delivery of such further instruments and documents) as may be
reasonably requested by another party, at the sole cost and expense of the
requesting party (except that any expense of Escrow Agent hereunder shall, be
reimbursed one-half by Buyer and one-half by Seller).
Section 16. COUNTERPARTS. This Agreement may be executed by the
parties hereto individually or in any combination, in one or more counterparts,
each of which shall be an original and all of which shall together constitute
one and the same agreement.
Section 17. ENTIRE AGREEMENT. This Agreement and the Purchase
Agreement and the other agreements referred to therein constitute the entire
agreement among the parties hereto and supersedes any prior understandings,
agreements or representations by or among the parties, written or oral, that may
have related in any way to the subject matter hereof. No waiver, modification,
amendment, termination or rescission of this Escrow Agreement shall be effective
or binding upon the Escrow Agent unless Escrow Agent shall have specifically
consented thereto in writing.
Section 18. ESCROW AGENT AS SELLER'S COUNSEL. The Depositors
acknowledge, understand and agree that (i) Escrow Agent is and will remain
Seller's counsel and as such Escrow Agent has not and will not exercise any
independent professional judgment on Buyer's behalf, and (i) notwithstanding its
role as Escrow Agent hereunder, Escrow Agent may, in the event of a dispute
between the Depositors, act as Seller's counsel and represent Seller in any
dispute or litigation; provided, however that Escrow Agent (i) resigns and
appoints a successor or substitute escrow agent, (ii) petitions any court of
proper jurisdiction for the appointment of a successor escrow agent or (iii)
interpleads all Escrowed Property into a court of proper jurisdiction, which the
Depositors specifically agree Escrow Agent may do.
Section 19. DEFINITIONS. Terms used herein and not defined shall
have the meanings given such terms in the Purchase Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective duly authorized officers on the date first
written above.
SAGE NETWORKS ACQUISITION CORP.
/s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: President
Tax Identification No.:
HOMECOME COMMUNICATIONS INC.
/s/ Xxxxxx Xxx
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Name: Xxxxxx Xxx
Title: President
Tax Identification No.:
XXXX MOSS KLINE & XXXXX LLP
/s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
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