Exhibit 10.3
INDEMNIFICATION ESCROW AGREEMENT
This INDEMNIFICATION ESCROW AGREEMENT, dated as of May 4, 2004 (this
"Agreement"), is made and entered into by and among NOMOS Corporation, a
Delaware corporation (the "Company"), Xxxx X. Xxxxxx, on behalf of the Company's
stockholders (the "Stockholder Representative"), North American Scientific,
Inc., a Delaware corporation ("Acquiror"), and U.S. Bank National Association, a
national banking association ("Escrow Agent"), in connection with the Agreement
and Plan of Merger, dated as of October 26, 2003, as amended by the First
Amendment to Agreement and Plan of Merger, dated as of November 25, 2003, and
the Second Amendment to Agreement and Plan of Merger, dated as of March 2, 2004
(the "Merger Agreement"), among the Company, Acquiror and AM Capital I, Inc., a
Delaware corporation and wholly-owned subsidiary of Acquiror ("Merger Sub").
W I T N E S S E T H:
WHEREAS, pursuant to Section 3.6 of the Merger Agreement, the
Company, on behalf of its stockholders (collectively, the "Stockholders"), has
agreed to make available to Acquiror and the Merger Sub two separate escrow
funds to compensate such parties for certain Indemnified Losses (as such term is
defined in the Merger Agreement);
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual obligations herein, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. DEFINITIONS. All capitalized terms used but not defined herein
are used herein as defined in the Merger Agreement.
2. ESTABLISHMENT OF ESCROW. As of the Closing, Acquiror shall
deliver, or cause its transfer agent to deliver, to the Escrow Agent for deposit
into escrow hereunder:
(a) the following items (collectively, the "General Escrow
Fund"):
(i) a certificate evidencing 10 percent of the shares of
Acquiror Common Stock to be issued in the Merger as required by Section 3.6 of
the Merger Agreement (collectively, the "General Escrowed Shares"), registered
in the name of the Escrow Agent as nominee for the Stockholders; and
(ii) an aggregate amount of cash equal to 10 percent of
the aggregate amount of cash to be paid in the Merger pursuant to Section 3.3 of
the Merger Agreement as required by Section 3.6 of the Merger Agreement (the
"General Escrowed Cash"); and
(b) the following items (collectively, the "Special Escrow
Fund", and together with the General Escrow Fund, collectively, the "Escrow
Fund"):
(i) a certificate evidencing 307,617 shares of Acquiror
Common Stock to be issued in the Merger as required by Section 3.6 of the Merger
Agreement (collectively, the "Special Escrowed Shares", and together with the
General Escrowed Shares,
the "Escrowed Shares"), registered in the name of the Escrow Agent as nominee
for the Stockholders; and
(ii) an aggregate amount of cash equal to $700,800 to be
paid in the Merger pursuant to Section 3.3 of the Merger Agreement as required
by Section 3.6 of the Merger Agreement (the "Special Escrowed Cash", and
together with the General Escrowed Cash, collectively, the "Escrowed Cash").
The Escrow Agent agrees to establish and maintain the General Escrow Fund and
the Special Escrow Fund in the manner set forth herein. The Escrow Agent shall
have no duty to confirm or verify the accuracy or correctness of the amount of
any Escrowed Shares or Escrowed Cash deposited with it hereunder.
3. MAINTENANCE OF THE ESCROW.
(a) With respect to each Escrow Fund, the Escrow Agent shall
establish a separate account (each, a "Subaccount") for each Stockholder for the
number of Escrowed Shares and the amount of Escrowed Cash set forth opposite
such Stockholder's name in the column identified for each Escrow Fund on Annex A
attached hereto (the "Stockholder List"). The ratio of the total number of
Escrowed Shares listed opposite a given Stockholder's name on the Stockholder
List to the total number of Escrowed Shares set forth on the Stockholder List,
as of the date hereof, is referred to herein as such Stockholder's "Proportional
Interest in Shares." The ratio of the amount of Escrowed Cash listed opposite a
given Stockholder's name on the Stockholder List to the total amount of Escrowed
Cash set forth on the Stockholder List, as of the date hereof, is referred to
herein as such Stockholder's "Proportional Interest in Cash." A Stockholder's
Proportional Interest in Shares and Proportional Interest in Cash shall
collectively be referred to herein as such Stockholder's "Proportional
Interest."
(b) The Escrow Agent shall invest the Escrowed Cash at the
written direction of the Stockholder Representative in any of the following
(collectively the "Permitted Investments"): (i) United States Treasury Bills
maturing within ninety-one (91) days of the date of purchase, (ii) demand
deposit accounts, money market deposit accounts and certificates of deposit with
a term not greater than ninety (90) days with a United States depository having
a reported capital and surplus of not less than $50 million and (iii) commercial
paper which is rated on the date of purchase in one of the two highest rating
categories by both Standard and Poor's Ratings Group and Xxxxx'x Investors
Service, Inc. and matures not more than ninety (90) days from the date of
purchase. In the absence of duly authorized and complete directions regarding
investment of Escrowed Cash from the Stockholder Representative, Escrow Agent
shall automatically invest and reinvest the same in units of the money market
mutual funds identified on Annex C attached hereto and incorporated herein,
which funds may be managed by an affiliate of the Escrow Agent. Any income
earned or accrued with respect to the applicable Escrowed Cash amount shall
become a part of the applicable Escrow Fund (but shall not be used to satisfy
any claims by Acquiror Indemnified Parties pursuant to Section 5 hereof) and
credited proportionately to the Subaccounts into which the applicable Escrowed
Cash was initially deposited on the date hereof. The Escrow Agent shall have no
liability for any loss incurred as a
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result of investments made or liquidated by it in accordance with the provisions
of this Agreement.
(c) Any distributions in respect of the Escrowed Shares for
stock splits, stock combinations, recapitalizations and similar transactions
received by the Escrow Agent shall become a part of the applicable Escrow Fund,
credited proportionately to the applicable Subaccounts in accordance with the
Proportional Interest in Shares and shall be considered Escrowed Shares of each
Stockholder for all purposes hereof. In the event the Escrowed Shares are
reclassified or otherwise changed into or exchanged for other securities,
property or cash pursuant to any merger, consolidation, sale of assets or
liquidation or other transaction, the securities, cash or other property
received by the Escrow Agent in respect of the Escrowed Shares shall become a
part of the applicable Escrow Fund, credited proportionately to the Subaccounts
in accordance with the Proportional Interest in Shares of each Stockholder and
shall be considered Escrowed Shares for all purposes hereof. All other
distributions in respect of the Escrowed Shares received by the Escrow Agent
shall become a part of the applicable Escrow Fund (but shall not be used to
satisfy any claims by Acquiror Indemnified Parties pursuant to Section 5 hereof)
and credited proportionately to the Subaccounts of the Stockholders in
accordance with the Proportional Interest in Shares.
(d) The Escrow Agent shall maintain records reflecting each
Stockholder's Proportional Interest in the applicable Escrow Fund and shall
adjust each Subaccount to reflect distributions from, and additions or
substitutions to, the applicable Escrow Fund. The Escrow Agent is hereby granted
the power to effect any transfer or distribution of all or any portion of the
applicable Escrow Fund required by this Agreement. Acquiror shall cooperate with
the Escrow Agent in promptly issuing, or causing its transfer agent to promptly
issue, such stock certificates as shall be required to effect transfers of
Escrowed Shares required by this Agreement. All Escrowed Shares and other
securities held in the Escrow Fund shall be registered in the name of the Escrow
Agent as nominee for the Stockholders in the respective amounts set forth on the
Stockholder List. Notwithstanding the above, upon the determination by Acquiror
that a Stockholder has perfected its dissenter's right of appraisal under
applicable Delaware law, Acquiror shall deliver to the Escrow Agent a revised
Stockholder List that removes such Stockholder from the Stockholder List and
reflects such removal in calculating the Proportional Interest of all other
Stockholders, which shall replace, in its entirety, Annex A attached hereto.
(e) All dividends, distributions, interest and gains earned or
realized on the applicable Escrow Fund (collectively "Earnings") and credited to
each Subaccount shall be treated as having been received by the Stockholders to
whose Subaccount the Earnings are credited for tax purposes. The Stockholder
List sets forth each Stockholder's address and Taxpayer Identification Number.
The Escrow Agent shall file information returns with the United States Internal
Revenue Service and distribute payee statements to the Stockholders, documenting
such Earnings. Stockholder Representative shall provide to the Escrow Agent all
forms and information necessary to complete such information returns and payee
statements. In the event the Escrow Agent becomes liable for the payment of
taxes, including withholding taxes, relating to any Earnings or any payment made
hereunder, the Escrow Agent may deduct such taxes from the Escrow Fund.
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4. ADMINISTRATION OF ESCROW FUND.
(a) Subject to the provisions of Article XII of the Merger
Agreement and Sections 5 of this Agreement, (i) the General Escrow Fund shall be
available to compensate the Acquiror Indemnified Parties for any General
Indemnified Losses and (ii) the Special Escrow Fund shall be available to
compensate the Acquiror Indemnified Parties for any Special Indemnified Losses.
(b) No Escrowed Shares or any beneficial interest therein or
any other portion of the applicable Escrow Fund may be pledged, sold, assigned
or transferred, including by operation of law, by any Stockholder or be taken or
reached by any legal or equitable process in satisfaction of any debt or other
liability of any such Stockholder, prior to the delivery and transfer to such
Stockholder of such Stockholder's Proportional Interest of the applicable Escrow
Fund by the Escrow Agent as provided herein.
(c) The Escrow Agent shall hold and safeguard the Escrow Fund
during the term of this Agreement, shall not treat the Escrow Fund as the
property of Acquiror and shall hold and dispose of the Escrow Fund only in
accordance with the terms hereof. Any distributions declared in respect of
Escrowed Shares, but unpaid prior to the dates such Escrowed Shares are
distributed from the Escrow Fund shall not be added to the Escrow Fund pursuant
to Section 5 hereof but shall be distributed to the record holders of such
Escrowed Shares immediately prior to the date of such distribution.
(d) Each Stockholder shall be deemed the record holder of, and
shall have voting, dividend, distribution and all other rights in respect of,
the shares of Acquiror Common Stock held in the Escrow Fund on behalf of such
Stockholder in accordance with the Stockholder List. The Escrow Agent shall
promptly forward, or cause to be forwarded, copies of any proxies, proxy
statements and other soliciting materials which it receives to the Stockholders,
and shall vote the applicable portion of the Escrowed Shares in accordance with
any written instructions timely received from the Stockholders. Absent any such
written instructions, the Escrow Agent shall not vote any Escrowed Shares.
(e) Within 10 days following the second anniversary of the
Effective Time (the "General Escrow Termination Date"), the Escrow Agent shall
deliver to the Stockholders, in accordance with their respective Proportional
Interest in Cash and Proportional Interest in Shares, all remaining amounts in
the General Escrow Fund (collectively, the "Escrow Assets Available for
Release") that are not then subject to any unsatisfied Claims specified in any
Claim Certificate delivered to the Stockholder Representative and the Escrow
Agent before the General Escrow Termination Date with respect to facts and
circumstances existing prior to the General Escrow Termination Date ("Pending
Claims"); provided, however, that (i) a Claim Certificate shall be deemed to
have been given hereunder with respect to any General Indemnified Loss sought to
be collected from an insurance company by an Acquiror Indemnified Party under
Section 12.4 of the Merger Agreement if such General Indemnified Loss was
incurred within six months prior to the General Escrow Termination Date, and
notwithstanding such collection efforts the Acquiror shall deliver such Claim
Certificate prior to the General Escrow Termination Date and (ii) promptly upon
the resolution of all of such Pending Claims in accordance with the provisions
of Article XII of the Merger Agreement and Section 5 of this
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Agreement, Escrow Agent shall deliver to the Stockholders, in accordance with
their respective Proportional Interests, all remaining amounts in the General
Escrow Fund not required to satisfy the Pending Claims.
(f) Within 10 days after delivery to the Escrow Agent of
either of the following documents (the "Special Escrow Termination Date"), the
Escrow Agent shall deliver to the Stockholders, in accordance with their
respective Proportional Interest in Cash and Proportional Interest in Shares,
all remaining amounts in the Special Escrow Fund after payment in full of all
claims relating to the Xxxxxx/Xxxxxx Dispute: (i) a certified copy of a final
non-appealable judicial order or judgment setting forth the Claim Amount (as
defined in Section 5(a) below), if any, that the Acquiror Indemnified Parties
are entitled to receive out of the Special Escrow Fund with respect to the
Xxxxxx/Hunter Dispute or (ii) a copy of a written memorandum signed by an
Acquiror Indemnified Party and the Stockholder Representative setting forth the
Claim Amount, if any, that the Acquiror Indemnified Parties are entitled to
receive out of the Special Escrow Fund with respect to the Xxxxxx/Xxxxxx
Dispute.
5. CLAIMS FOR INDEMNIFICATION AGAINST THE ESCROW FUND.
(a) The Acquiror Indemnified Parties shall make any claims for
Indemnified Losses to be satisfied from the applicable Escrow Fund by delivering
a Claim Certificate (as defined below) to the Escrow Agent and, concurrently, a
copy of such Claim Certificate to the Stockholder Representative. For purposes
hereof, "Claim Certificate" shall mean a certificate signed by any officer of
Acquiror or the Surviving Corporation, as the case may be. Such Claim
Certificate shall (i) state that the Acquiror Indemnified Party claiming
indemnification has paid, incurred or properly accrued or reasonably anticipates
that it will have to pay, incur or accrue Indemnified Losses and the amount of
such Indemnified Losses ("Claim Amount") and (ii) specify in reasonable detail
the individual items of Indemnified Losses included in the amount so stated, the
date each such item was paid, incurred or properly accrued or the basis for such
anticipated liability and the nature of the misrepresentation, breach of
warranty or covenant to which such Indemnified Losses are related. Unless the
Stockholder Representative shall have delivered an Objection (as defined below)
in accordance with Section 5(b) hereof, the Escrow Agent shall, on the 30th day
(or such earlier day as the Stockholder Representative shall authorize in
writing to the Escrow Agent) after receipt of a Claim Certificate, deliver to
the Acquiror Indemnified Party (in accordance with Sections 5(d) and 5(e) below)
the portion of the applicable Escrow Fund equal to Claim Amount.
(b) If the Stockholder Representative objects to any claim or
claims made in any Claim Certificate to recover Indemnified Losses, the
Stockholder Representative must deliver to the Escrow Agent a writing setting
forth the basis for such objection within 30 days after delivery of the Claim
Certificate to the Stockholder Representative (an "Objection"). Within 10 days
of receipt of an Objection properly made, the Escrow Agent shall deliver to the
Acquiror Indemnified Party from the applicable Escrow Fund such portion of the
Claim Amount, if any, which is not subject to such Objection. Thereafter, the
Escrow Agent shall not distribute to the Acquiror Indemnified Party any further
portion of the Claim Amount stated in the Claim Certificate which is subject to
such Objection out of the applicable Escrow Fund until the Escrow Agent shall
have received (A) a certified copy of any final non-appealable judicial order or
judgment determining the dispute and setting forth the portion of the Claim
Amount, if any,
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which such Acquiror Indemnified Party is entitled to receive out of the
applicable Escrow Fund with respect to such Objection or (B) a copy of a written
memorandum signed by the applicable Acquiror Indemnified Party and the
Stockholder Representative resolving such dispute and setting forth the amount
of the Claim Amount, if any, which such Acquiror Indemnified Party is entitled
to receive out of the applicable Escrow Fund with respect to such Objection, in
either case, in accordance with Section 5(c) below. The Escrow Agent will
deliver such portion of the Claim Amount from the applicable Escrow Fund to the
Acquiror Indemnified Party within ten (10) days after the receipt of such final
non-appealable judicial order, judgment or signed memorandum, as the case may
be.
(c) If the Stockholder Representative has delivered an
Objection and the Stockholder Representative and the Acquiror Indemnified
Parties have agreed upon the rights of the respective parties with respect to
each claim for indemnification hereunder subject to such Objection, then a
memorandum setting forth such agreement shall be prepared and signed by the
Stockholder Representative and the applicable Acquiror Indemnified Parties and
furnished to the Escrow Agent. Such memorandum shall state the portion of the
Claim Amount to be distributed to the Acquiror Indemnified Party out of the
applicable Escrow Fund in connection with such Objection. The Escrow Agent shall
be entitled to rely on any such memorandum and distribute such portion of the
Claim Amount out of the applicable Escrow Fund in accordance with the terms
thereof. If no agreement is reached by the parties, then Acquiror or the
Surviving Corporation or the Stockholder Representative, on behalf of the
Stockholders, may commence legal action either to obtain a judicial
determination of the dispute (unless the amount of the Indemnified Losses at
issue is pending litigation with a third party, in which event the action shall
not be commenced until the amount of such Indemnified Losses is ascertained or
such parties agree to the commencement of such action).
(d) (i) All distributions of the General Escrow Fund pursuant
to this Section 5 shall be made with a combination of General Escrowed Shares
and General Escrowed Cash in such respective amounts determined as follows: (A)
a number of General Escrowed Shares with an aggregate Acquiror Stock Price (as
defined below) equal to the General Escrowed Shares Percentage (as defined
below) multiplied by the amount of the payable portion of the Claim Amount and
(B) an amount of General Escrowed Cash equal to the General Escrowed Cash
Percentage (as defined below) multiplied by the amount of the payable portion of
the Claim Amount. For purposes hereof, "General Escrowed Shares Percentage"
shall mean 80 percent and "General Escrowed Cash Percentage" shall mean 20
percent.
(ii) All distributions of the Special Escrow Fund
pursuant to this Section 5 shall be settled from a Pro Rata Portion (as defined
below) of each Subaccount established under the Special Escrow Fund as follows:
(A) to the extent that any such Subaccount contains any Special Escrowed Cash,
the distribution in respect thereof shall be paid solely in cash until such time
as the Special Escrowed Cash contained therein is depleted, at which time the
balance of such distribution shall be paid in Special Escrowed Shares valued at
the Pre-Announcement Share Price (as defined below) and (B) to the extent any
such Subaccount only contains Special Escrowed Shares, the distribution in
respect thereof shall be paid in Special Escrowed Shares valued at the
Pre-Announcement Share Price.
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For purposes of this Agreement, the term "Pre-Announcement Share Price" shall
mean a value of $7.47 for each Special Escrowed Share; and "Pro Rata Portion"
shall mean the relative value of the combination of Special Escrowed Shares
(valued at the Pre-Announcement Share Price) and Special Escrowed Cash contained
in each Subaccount established under the Special Escrow Fund to the aggregate
value of all the Special Escrowed Shares (valued at the Pre-Announcement Share
Price) and all the Special Escrowed Cash deposited in the Special Escrowed Fund,
measured as of the date hereof.
(e) (i) For the purposes of determining the number of General
Escrowed Shares to be delivered to an Acquiror Indemnified Party out of the
General Escrow Fund pursuant to this Section 5, each share of Acquiror Common
Stock shall be valued at the Acquiror Stock Price (as adjusted, as applicable,
for any stock splits, stock combinations, recapitalizations and similar actions
or transactions). For purposes of this Agreement, "Acquiror Stock Price" shall
mean the average closing price of the Acquiror Common Stock on the Nasdaq
National Market as reported in The Wall Street Journal for the five (5) trading
days ending one (1) business day prior to date that the General Escrowed Shares
are distributed out of the General Escrow Fund by the Escrow Agent; provided,
however, in the event that an Objection is made with respect to a Claim then the
Acquiror Stock Price shall mean the average closing price of the Acquiror Common
Stock on the Nasdaq National Market as reported in The Wall Street Journal for
the five (5) consecutive trading days ending (1) business day prior to the date
that the Claim is delivered to the Stockholder Representative.
(ii) For the purposes of determining the number of
Special Escrowed Shares to be delivered to an Acquiror Indemnified Party out of
the Special Escrow Fund pursuant to this Section 5, each share of Acquiror
Common Stock shall be valued at the Pre-Announcement Share Price.
(f) Whenever this Agreement provides that the Escrow Agent
shall disburse Escrowed Shares to an Acquiror Indemnified Party, the Escrow
Agent shall deliver to the transfer agent for the Acquiror the stock certificate
representing such Escrowed Shares and the transfer agent shall deliver to the
Escrow Agent one stock certificate representing the number of shares to be
delivered to the Acquiror Indemnified Party and another stock certificate
representing the balance of Escrowed Shares remaining. The Escrow Agent shall
then deliver to the Acquiror Indemnified Party a stock certificate representing
the appropriate number of General Escrowed Shares determined in accordance with
Sections 5(d) and 5(e). Distributions of General Escrowed Shares pursuant to
Section 5(d)(i) shall be debited to the Subaccounts established from the
applicable Escrow Fund in accordance with the Stockholders' respective
Proportional Interests in Shares. Distributions of Special Escrowed Shares
pursuant to Section 5(d)(ii) shall be debited to such Subaccounts in accordance
with Section 5(b)(ii).
6. LIMITATIONS ON CLAIMS FROM ESCROW FUND. The rights of the
Acquiror Indemnified Parties to make any claims against the applicable Escrow
Fund shall be subject to all of the limitations set forth in the Merger
Agreement, including, without limitation, the limitations set forth in Section
12.4 thereof.
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7. STOCKHOLDER REPRESENTATIVE.
(a) By virtue of the approval of the Merger Agreement by the
holders of Company Common Stock and Company Preferred Stock (as such terms are
defined in the Merger Agreement), Xxxx X. Xxxxxx shall (subject to Section 7(e)
hereof) be the Stockholder Representative hereunder and shall be constituted and
appointed as agent and attorney-in-fact for and on behalf of each of the
Stockholders. The Stockholder Representative shall have full power and authority
to represent all of the Stockholders and their successors with respect to all
matters arising under this Agreement and all actions taken by the Stockholder
Representative hereunder and thereunder shall be binding upon all Stockholders
and their successors as if expressly confirmed and ratified in writing by each
of them, including, without limitation, resolving all claims relating to the
Escrow Fund and any indemnification claims and obligations. The Stockholder
Representative shall take any and all actions which such Stockholder
Representative believes are necessary or appropriate under this Agreement for
and on behalf of the Stockholders, as fully as if such Stockholder
Representative were acting on his own behalf, including (without limitation)
consenting to, compromising or settling issues with respect to the Escrow Fund
and all such indemnity claims with Acquiror Indemnified Parties under this
Agreement, taking any and all other actions specified in or contemplated by this
Agreement, and engaging counsel or accountants in connection with the foregoing
matters. Without limiting the generality of the foregoing, the Stockholder
Representative shall have full power and authority to interpret all the terms
and provisions, and to consent to any amendment, of this Agreement on behalf of
all Stockholders and such successors. No bond shall be required of the
Stockholder Representative and the Stockholder Representative shall receive no
compensation for services hereunder; provided, however, that Stockholder
Representative shall be entitled to reimbursement for reasonable expenses
incurred by Stockholder Representative in performing his duties hereunder
(including reasonable attorneys' fees), which reimbursement shall be made solely
out of the Escrow Assets Available for Release after the General Escrow
Termination Date.
(b) The Stockholder Representative shall not be liable to
Stockholders for any act done or omitted hereunder as Stockholder Representative
while acting in good faith and in the exercise of reasonable judgment, and any
act done or omitted pursuant to the written advice of counsel shall be
conclusive evidence of such good faith.
(c) Solely to the extent of the Escrow Assets Available for
Release after the General Escrow Termination Date, the Stockholder
Representative shall be indemnified and held harmless from and against any and
all losses, claims, damages, liabilities and expenses, including reasonable
costs of investigation, outside counsel fees, and disbursements that may be
imposed on or incurred by the Stockholder Representative in connection with the
performance of its duties under this Agreement, including but not limited to any
arbitration or litigation arising from this Agreement or involving the subject
matter hereof, unless such losses, claims, damages, liabilities or expenses
shall be caused by the negligence or willful misconduct on the part of the
Stockholder Representative.
(d) The Stockholder Representative shall treat confidentially
and not disclose any nonpublic information from or about Acquiror or the Merger
Sub to anyone, except as may be necessary in connection with any legal
proceeding to enforce the Stockholder's rights
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under this Agreement or the Merger Agreement or as otherwise required by law.
(e) The Stockholder Representative may resign, and may be
removed and a successor named by Stockholders having, in the aggregate,
Subaccounts containing at least 50 percent or more of the total fair market
value of the Escrow Fund. The Escrow Agent shall be promptly notified in writing
of any such change in the Stockholder Representative. Upon any such replacement,
the replacement Stockholder Representative shall be deemed the "Stockholder
Representative" for all purposes hereunder.
8. ACTIONS OF THE STOCKHOLDER REPRESENTATIVE. A decision, act,
consent or instruction of the Stockholder Representative shall be deemed to
constitute a decision of all the Stockholders and shall be final, binding and
conclusive upon each such Stockholder of the Company, and Acquiror may rely upon
any decision, act, consent or instruction of the Stockholder Representative as
being the decision, act, consent or instruction of each and every such
Stockholder. The Escrow Agent, the Acquiror and the Surviving Corporation are
hereby relieved from any liability to any Person for any acts done by them in
accordance with such decision, act, consent or instruction of the Stockholder
Representative.
9. FEES OF THE ESCROW AGENT. The fees of the Escrow Agent, including
the normal costs of administering the Escrow Fund as set forth on the Fee
Schedule attached hereto as Annex B, any expenses incurred by the Escrow Agent
in performing its obligations pursuant to Section 4(d) herein and all fees and
costs associated with the Escrow Agent's administration of Indemnified Losses,
shall be paid (i) 50 percent by the Acquiror (out of its own funds), and (ii)
fifty percent by the Stockholders (which shall be paid solely out of the Escrow
Fund).
10. ESCROW AGENT'S DUTIES
(a) The Escrow Agent shall be obligated only for the
performance of such duties as are specifically set forth herein (and no implied
duties).
(b) In the event the Escrow Agent reasonably believes any
ambiguity or uncertainty exists hereunder or in any notice, instruction,
direction, request or other communication, paper or document received by the
Escrow Agent hereunder, the Escrow Agent may refrain from taking any action and
shall be fully protected and shall not be liable in any way to Acquiror, the
Surviving Corporation, the Stockholder Representative or any Stockholder or
other Person for refraining from taking such action, unless the Escrow Agent
receives written instructions signed by Acquiror and the Stockholder
Representative which eliminates such ambiguity or uncertainty to the reasonable
satisfaction of Escrow Agent.
11. LIABILITY OF THE ESCROW AGENT. In performing any of its duties
under this Agreement, the Escrow Agent shall not be liable to any party for
damages, losses or expenses, except in the event of gross negligence or willful
misconduct on the part of the Escrow Agent. The Escrow Agent shall not incur any
such liability for any action taken or omitted in reliance upon any instrument,
including any written statement or affidavit provided for in this Agreement that
the Escrow Agent shall reasonably and in good faith believe to be genuine. In
addition, the Escrow Agent may consult with independent legal counsel in
connection with its
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duties under this Agreement and shall be fully protected in any act taken,
suffered or permitted by it in good faith and reasonable reliance on the advice
of counsel. The Escrow Agent shall not be responsible for good faith mistakes
with respect to determining and verifying the authority of any Person acting or
purporting to act on behalf of any party to this Agreement to the extent the
Escrow Agent is not grossly negligent.
12. SUCCESSOR ESCROW AGENTS. Any Person that is the successor of
Escrow Agent, by merger, consolidation or transfer of substantially all the
business of the Escrow Agent, shall be the Escrow Agent under this Escrow
Agreement without further act.
13. DISPUTE RESOLUTION. If any controversy arises between the
parties to this Agreement, or with any other party, concerning the subject
matter of the Escrow Fund or the terms and conditions hereof, the Escrow Agent
will not be required to determine the controversy or to take any action
regarding it. The Escrow Agent may hold all documents and funds and may wait for
settlement of any such controversy by final appropriate legal proceedings or
other means as, in the Escrow Agent's reasonable discretion, it may require,
despite what may be set forth elsewhere in this Agreement.
14. INDEMNIFICATION OF ESCROW AGENT. Acquiror (but only to the
extent of the amount available from the Escrow Fund) and the Stockholder
Representative, on behalf of the Stockholders (but only out of, and only to the
extent of the amount available from, the Escrow Fund) jointly and severally
agree to indemnify and hold the Escrow Agent harmless against any and all
losses, claims, damages, liabilities and expenses, including reasonable costs of
investigation, outside counsel fees, and disbursements that may be imposed on
the Escrow Agent, or incurred by it in connection with the performance of its
duties under this Agreement, including but not limited to any arbitration or
litigation arising from this Agreement or involving the subject matter hereof,
unless such loss, claim, damage, liability or expense shall be caused by the
negligence or willful misconduct on the part of the Escrow Agent. Nothing
contained in this Section 14 shall impair the respective rights of the
Stockholder Representative, on behalf of the Stockholders, and the Acquiror
against the other.
15. RESIGNATION OF ESCROW AGENT. The Escrow Agent may resign at any
time upon giving at least 30 days written notice to the other parties; provided,
however, that no such resignation shall become effective until the appointment
of a successor Escrow Agent which shall be accomplished as follows: Acquiror and
the Stockholder Representative shall use all reasonable efforts to agree on a
successor Escrow Agent within 30 days after receiving such notice. If the
parties fail to agree on a successor Escrow Agent within such time, then the
Escrow Agent shall have the right to appoint a successor Escrow Agent, provided
that the successor so chosen shall have capital, surplus and undivided profits
of at least $200,000,000. The successor Escrow Agent shall execute and deliver
to the Escrow Agent an instrument accepting such appointment, and the successor
Escrow Agent shall, without further acts, be vested with all the property
rights, powers and duties of the predecessor Escrow Agent as if originally named
as Escrow Agent herein. The predecessor Escrow Agent then shall be discharged
from any further duties and liability under this Agreement.
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16. MISCELLANEOUS.
(a) Assignment; Binding Upon Successors and Assigns. None of
the parties hereto may assign any of its rights or obligations hereunder without
the prior written consent of the other parties; provided, however, that the
Stockholders' interest in this Agreement and the Escrow Fund (prior to the
disbursement thereof) may be transferred by operation of law, intestacy, devise
or descent. This Agreement will be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
(b) Severability. Any term or provision of this Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable
(c) Entire Agreement. This Agreement, the Merger Agreement,
the Annexes hereto, the documents referenced herein, and the exhibits thereto,
constitute the entire understanding and agreement of the parties hereto with
respect to the subject matter hereof and supersede all prior and contemporaneous
agreements or understandings, inducements or conditions, express or implied,
written or oral, between the parties with respect hereto. The express terms
hereof control and supersede any course of performance or trade usage
inconsistent with any of the terms hereof.
(d) Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally, mailed by
registered or certified mail (return receipt requested) or sent via facsimile to
the parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
If to Acquiror to:
North American Scientific, Inc.
00000 Xxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: L. Xxxxxxx Xxxxxx, President
Facsimile: (000) 000-0000
with a copy to:
XxXxxxxxx, Will & Xxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
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If to the Company, to:
NOMOS Corporation
000 Xxxx Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx Xxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, President
Facsimile: (000) 000-0000
If to the Stockholder Representative, to:
Xxxx X. Xxxxxx
Xxx Xxxxx Xxxx
Xxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxx & Xxxxxxx
00 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxx X. Baseman, Esq.
Facsimile: (000) 000-0000
If to the Escrow Agent, to:
U.S. Bank National Association
Corporate Trust Services
00 Xxxxxxxxxx Xxx. XX-XX-XX0X
Xx. Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Facsimile: 000-000-0000
(e) Other Remedies. Except as otherwise provided herein, any
and all remedies herein expressly conferred upon a party shall be deemed
cumulative with and not exclusive of any other remedy conferred hereby or by law
on such party, and the exercise of any one remedy shall not preclude the
exercise of any other.
(f) Amendment and Waivers. Any term or provision of this
Agreement may be amended only by an instrument in writing signed on behalf of
each of the parties hereto. The observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only by a writing signed by the party to be bound thereby. The
waiver by a party of any breach hereof for default in payment of any amount due
hereunder or default in the performance hereof shall not be deemed to constitute
a waiver of any other default or any succeeding breach or default.
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(g) Further Assurances. Each party agrees to reasonably
cooperate with the other parties and to execute such further instruments,
documents and agreements and to give such further written assurances, as may be
reasonably requested by any other party to better evidence and reflect the
transactions described herein and contemplated hereby and to carry into effect
the intents and purposes of this Agreement.
(h) Absence of Third Party Beneficiary Rights. No provisions
of this Agreement are intended, nor shall be interpreted, to provide or create
any third party beneficiary rights or any other rights of any kind in any
client, customer, affiliate, shareholder, partner of any party hereto or any
other Person unless specifically provided otherwise herein and except for the
Stockholders, and, except as so provided, all provisions hereof shall be solely
between the parties to this Agreement.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE LAWS OF THE
STATE OF DELAWARE APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY
WITHIN SUCH STATE.
(j) Facsimile. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be one and the same instrument.
The exchange of copies of this Agreement and of signature pages by facsimile
transmission shall constitute effective execution and delivery of this Agreement
as to the parties and may be used in lieu of the original Agreement for all
purposes. Signatures of the parties transmitted by facsimile shall be deemed to
be their original signatures for all purposes.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first written above.
NORTH AMERICAN SCIENTIFIC, INC.
By: /s/ L. Xxxxxxx Xxxxxx
--------------------------------------------
Name: L. Xxxxxxx Xxxxxx
Title: President and Chief Executive Officer
NOMOS CORPORATION
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
STOCKHOLDER REPRESENTATIVE
/s/ Xxxx X. Xxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxx
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
-14-
ANNEX A
STOCKHOLDER LIST
General Escrow Fund Special Escrow Fund
------------------------------- -------------------------------
Stockholder Name, General General Special Special
Address and Tax ID Number Escrowed Shares Escrowed Cash Escrowed Shares Escrowed Cash
------------------------- --------------- ------------- --------------- -------------
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ANNEX B
ESCROW AGENT FEES
Annual fee of $15,000.00
-00-
XXXXX X
X.X. XXXX TRUST NATIONAL ASSOCIATION
U.S. BANK MONEY MARKET ACCOUNTS
U.S. BANK NATIONAL ASSOCIATION
ACCOUNT DESCRIPTION AND TERMS
The U.S. Bank money market accounts are U.S. Bank National Association ("U.S.
Bank") deposit accounts designed to meet the needs of Global Escrow and other
Corporate Trust customers of U.S. Bank Trust National Association. The accounts
pay competitive variable interest rates, which are determined based upon the
customer's aggregated balance. These accounts are insured by the Federal Deposit
Insurance Corporation.
Interest rates currently offered on the accounts are determined at U.S. Bank's
discretion and may change daily. U.S. Bank uses the daily balance method to
calculate interest on these accounts. This method applies a daily periodic rate
to the principal in the accounts each day. The average daily balance is
calculated by adding the principal in an account for each day of the month and
dividing that figure by the number of days in the period. Interest is compounded
on a monthly basis.
The owner of the accounts is U.S. Bank Trust National Association as Agent for
its customers. All account deposits and withdrawals are performed by U.S. Bank
Trust National Association. U.S. Bank Trust National Association is an affiliate
of U.S. Bank.
For further information, call your account representative at U.S. Bank Trust
National Association.
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