ESCROW AGREEMENT
ESCROW
AGREEMENT, dated
April 6, 2007, between Sheridan Asset Management, LLC (“Sheridan”), Universal
Property Development and Acquisition Company (“UPDA”) and Xxxxxx Xxxxxx Xxxxxxxx
LLP (the “Escrow
Agent”).
WHEREAS,
SHERIDAN proposes to extend certain financial accommodations (the
“Accommodation”) to UPDA in the amount of approximately $2,726,250 and SHERIDAN
and UPDA have agreed upon the general terms and conditions of the Accommodation
and anticipate closing the Accommodation on April 9, 2007 (the
“Closing”).
NOW,
THEREFORE,
SHERIDAN and UPDA agree as follows:
1. On
the
date hereof, SHERIDAN has transferred to an Escrow Account maintained by
the
Escrow Agent the sum of $2,726,250 (the “Escrow Fund”). The Escrow Fund shall be
maintained in cash in a non-interest bearing account of the Escrow Agent
and
disbursed by the Escrow Agent only in accordance with the provisions of this
Agreement.
2. Upon
delivery to Escrow Agent of a written notice in the form attached hereto
(the
“Escrow Notice”) signed by SHERIDAN and UPDA, the Escrow Agent shall deliver the
entire Escrow Fund in accordance with the payment instructions contained
therein.
3. If
SHERIDAN and UPDA fail to deliver an Escrow Notice with respect to the Escrow
Fund to the Escrow Agent within one month of the date hereof, the entire
amount
of the Escrow Fund shall be transferred to SHERIDAN in accordance with payment
instructions delivered by SHERIDAN at that time.
4. The
Escrow Agent may act or refrain from acting in respect of any matter arising
in
connection with the administration of the Escrow Fund, shall have no duties
or
obligations other than as stated herein and shall be protected in acting
upon
any notice, certificate or other communication, not only as to the due execution
and the validity and effectiveness of its provisions, but also as to the
truth
and acceptability of any information therein contained, which it shall in
good
faith reasonably believe to be valid and to have been signed or presented
by a
proper person or persons. The Escrow Agent shall have no liability or
responsibility hereunder for any act or omission to act except for its own
gross
negligence or willful misconduct. The Escrow Agent shall not be bound by
any
notice, or demand with respect thereto, or any waiver, modification, amendment,
termination or rescission of this Agreement unless in writing delivered to
the
Escrow Agent, and, if the duties of the Escrow Agent are affected, unless
it
shall have given its prior written consent thereto. The Escrow Agent may,
at any
time, upon notice to SHERIDAN and UPDA, for any reason whatsoever, either
(a)
hold the Escrow Fund until otherwise directed by a written instrument signed
by
SHERIDAN and UPDA or (b) deposit the Escrow Fund in any court of competent
jurisdiction pending the final determination of any dispute between the parties
hereto.
5. Nothing
contained herein shall prevent the Escrow Agent from acting as counsel to
SHERIDAN, its affiliated companies or any of their respective directors,
officers, equity holders or employees in any dispute with UPDA or any third
party which may arise relating to the provisions of the Agreement, the
provisions hereof or those of any other agreement, document or instrument
delivered in connection therewith or herewith.
6. All
reasonable costs and expenses incurred by the Escrow Agent in performing
its
services under this Agreement shall be paid by UPDA.
7. The
Escrow Agent’s duties and responsibilities shall be limited to those expressly
set forth in this Agreement, and the Escrow Agent shall not be subject to,
nor
obliged to recognize, any agreement between, or direction or instruction
of,
SHERIDAN and UPDA, or any of their respective directors, officers, equity
holders or employees, unless reference thereto is made herein; provided,
however, that with the Escrow Agent’s written consent, this Agreement may be
amended at any time or times by an instrument in writing signed by the Escrow
Agent, SHERIDAN and UPDA.
8. If
any
property subject hereto is at any time attached, garnished or levied upon
under
any court order, or in case the payment, assignment, transfer, conveyance
or
delivery of any such property shall be stayed or enjoined by any court order,
or
in case any order, writ, judgment or decree shall be made or entered by any
court affecting such property, or any part thereof, then in any of such events,
the Escrow Agent is authorized to rely upon and comply with any such order,
writ, judgment or decree, and if it complies with any such order, writ, judgment
or decree, it shall not be liable to SHERIDAN or UPDA, their respective
affiliates or to any other person, firm or corporation by reason of such
compliance, even though such order, writ, judgment or decree may be subsequently
reversed, modified, annulled, set aside or vacated.
9. The
Escrow Agent may resign at any time upon ten (10) business days’ prior written
notice to SHERIDAN and UPDA. In the case of the Escrow Agent’s resignation, the
Escrow Agent’s only duty shall be to deliver all remaining deposits in the
Escrow Fund to a successor escrow agent acceptable to SHERIDAN, which acceptance
shall be evidenced by the written and signed order of SHERIDAN. If no such
order
is received by the Escrow Agent within five (5) days after giving such notice,
the Escrow Agent is unconditionally and irrevocably authorized and empowered,
in
its discretion, to appoint a successor escrow agent, which shall be a nationally
recognized bank or financial institution of its choosing, and to send any
and
all items deposited and maintained hereunder to such successor escrow
agent.
10. All
notices or other communications required or permitted hereunder shall be
in
writing and shall be deemed given or delivered (i) when delivered personally
or
by private courier, (ii) when actually delivered by registered United States
mail, return receipt requested or, (iii) when sent by telecopy if confirmed
as
received that day by the receiving party (provided that the original of such
notice or communication is sent that day by a means specified in clause (i)
or
(ii)), addresses and telecopy numbers provided for in the draft transaction
documents relating to the Accommodation or at such other address (or addresses)
as any of the parties may furnish in writing to the other parties. For all
purposes hereof (a) any notice mailed by the Escrow Agent shall be effective
at
the time it is deposited by the Escrow Agent in the United States mail, whether
or not it is actually received, and (b) any notice mailed to the Escrow Agent
shall not be effective until actually received by the Escrow Agent.
11. SHERIDAN
and UPDA, jointly and severally, agree to indemnify and hold the Escrow Agent
harmless from any and all loss, damage, claims, liabilities, judgments and
other
costs and expenses of every kind and nature which may be incurred by the
Escrow
Agent by reason of its acceptance of, and its performance under, this Agreement,
including, without limitation, attorneys’ fees either paid to retained attorneys
or amounts representing the fair value of legal services rendered to itself
for
liabilities incurred (the “Losses”), except to the extent the Losses arise from
the gross negligence or willful misconduct of the Escrow Agent.
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12. The
Escrow Agent shall be automatically released from all responsibility and
liability under this Agreement upon the Escrow Agent’s delivery or deposit of
the entire amount of the Escrow Fund in accordance with the provisions of
this
Agreement.
13. This
Escrow Agreement constitutes the entire understanding among the parties as
to
the subject matter hereof and no waiver or modification of the terms hereof
shall be valid unless in writing signed by SHERIDAN, UPDA and the Escrow
Agent
and only to the extent therein set forth.
14. This
Escrow Agreement shall be governed by, and construed in accordance with,
the
laws of the State of New York.
15. This
Escrow Agreement shall be binding upon and inure to the benefit of the parties
hereto, their respective heirs, administrators, executors, successors and
permitted assigns.
16. This
Escrow Agreement may be executed in one or more counterparts, each of which
shall be deemed an original.
IN
WITNESS WHEREOF, each of the parties hereto has executed this Agreement as
of
the day and year first above written.
|
SHERIDAN
ASSET
MANAGEMENT
|
XXXXXX XXXXXX XXXXXXXX LLP | |||
| By: | By: | |||
|
Name:
Title:
|
Name:
Title:
|
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| UNIVERSAL PROPERTY DEVELOPMENT AND ACQUISITION CORP. | ||||
| By: | ||||
|
Name: Title:
|
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ESCROW
NOTICE
________________,
200__
Xxxxxx
Xxxxxx Rosenman LLP
000
Xxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000-0000
You
are
hereby directed to transfer the Escrow Fund (as such term is defined in the
Escrow Agreement attached thereto) to the following accounts:
1)
$100,000 to Sheridan Asset Management, LLC:
XX
Xxxxxx
Xxxxx
[insert
account information]
Account:
Sheridan Asset Management, LLC
2)
[insert accounts and amounts for payment of counsel to Sheridan and other
closing expenses]
3)
$1,031,959.63 to SDS Capital Group SPC, Ltd:
[insert
account information]
4)
$468,040.37 to BayStar Capital II, LP:
[insert
account information]
5)
$1,000,000 to:
[insert
account information for shareholders of Heartland]
|
Very
truly yours,
SHERIDAN
ASSET MANAGEMENT, LLC
|
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| By: | ||||
|
Name:
Title:
|
|
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|
UNIVERSAL PROPERTY DEVELOPMENT AND ACQUISITION
CORPORATION
|
||||
| By: | ||||
|
Name:
Title:
|
|
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