Exhibit B
to Stock Purchase Agreement
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "AGREEMENT") is entered into as of
November 24, 2000, by and among Corillian Corporation, an Oregon corporation
(the "PURCHASER"), Xxxxx X. Xxxxxxx (the "SHAREHOLDER REPRESENTATIVE"), as
agent and representative of the Shareholders of Xxxxxxx Associates, Inc., a
California corporation (the "COMPANY"), the Shareholders of the Company (the
"Shareholders") and ChaseMellon Shareholder Services, L.L.C., as escrow agent
(the "ESCROW AGENT").
RECITALS
A. Pursuant to the provisions of that certain Stock Purchase
Agreement dated as of November 24, 2000 (the "PURCHASE AGREEMENT"), by and
among the Purchaser, the Company and all of the shareholders of the Company,
the parties thereto intend to effect the sale of all capital stock of the
Company to the Purchaser (the "SALE"). Capitalized terms used herein and not
otherwise defined shall have the meaning set forth in the Purchase Agreement.
B. Under the terms of the Purchase Agreement, 521,807 shares of the
Purchaser Common Stock issued as part of the Purchase Consideration (the
"ESCROW SHARES") shall be deposited in an escrow account with the Escrow
Agent. Until released by the Escrow Agent pursuant to the terms hereof,
23,364 Escrow Shares will remain subject to any purchase price adjustments
under Section 2.5 of the Purchase Agreement (the "HOLDBACK SHARES"), 186,916
Escrow Shares will remain subject to any indemnification claims the Purchaser
Indemnified Parties may have under and in accordance with Article IX of the
Purchase Agreement (the "INDEMNIFICATION SHARES"), and 311,527 Escrow Shares
(the "Post-Closing SHARES") will remain subject to forfeiture under Section
2.4.4 of the Purchase Agreement.
C. The Purchase Agreement provides that the Escrow Agent shall hold
and administer the shares of the Purchaser Common Stock so deposited in
accordance with the terms of this Agreement.
D. Pursuant to the Purchase Agreement, each Shareholder has
irrevocably authorized and appointed Xxxxx Xxxxxxx as the Shareholder
Representative, as his, her or its representative and true and lawful
attorney-in-fact and agent to act in such Shareholder's name, place and stead
and to execute in the name and on behalf of such
Shareholder this Agreement and any other agreement, certificate, instrument
or document to be delivered by the Shareholders in connection with this
Agreement.
E. The execution and delivery of this Agreement is a condition
precedent to the obligations of the parties under the Purchase Agreement.
F. In the event of any conflict between the terms of this Agreement
(other than those terms herein that affect the rights, indemnification,
duties or obligations of the Escrow Agent, which shall be governed
exclusively by the terms of this Agreement) and the Purchase Agreement, the
terms of the Purchase Agreement shall prevail.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements set forth herein, the parties agree as follows:
1. DELIVERY OF SHARES; PURCHASE CONSIDERATION; INDEMNIFICATION
(a) At the Closing, the Escrow Shares shall be deposited in escrow
with the Escrow Agent, to be held and administered in accordance with the
terms and conditions of this Agreement. The Escrow Shares shall be (i) held
by the Escrow Agent in book entry form, (ii) registered in the name of the
respective Shareholders in the initial denominations set forth on Schedule A
attached hereto (the "SCHEDULE") and (iii) accompanied by three stock powers,
which shall be endorsed in blank by the Shareholders at the Closing. The
Schedule shall set forth the Closing Date and shall indicate all holders of
Company Capital Stock of record immediately prior to the Closing Date (the
"RECORD HOLDERS") and reflect each such Record Holder's mailing address and
interest in the Escrow Shares. The Schedule shall be updated from time to
time as set forth in Section 3(b).
(b) If there is no reduction in the Purchase Consideration under
Section 2.5 of the Purchase Agreement and all disputes, if any, regarding the
Working Capital of the Company that could have required that a reduction to
the Purchase Consideration be made are resolved in accordance with such
Section 2.5, the Purchaser and the Shareholder Representative shall promptly
notify the Escrow Agent in writing to such effect, and the Escrow Agent shall
release the Holdback Shares to the Record Holders PRO RATA in accordance with
their respective interests in the Escrow Shares as originally set forth on
the Schedule.
(c) If there is any reduction in the Purchase Consideration under
Section 2.5 of the Purchase Agreement, the Purchaser and the Shareholder
Representative shall promptly notify the Escrow Agent in writing to such
effect, and the Escrow Agent
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shall, as promptly as practicable after its receipt of such notice, release
to the Purchaser the number of Holdback Shares as specified in such notice.
Any remaining Holdback Shares, if any, will be released to the Record Holders
PRO RATA in accordance with their respective interests in the Escrow Shares
as originally set forth on the Schedule.
(d) If the Deferred Amount under the Purchase Agreement on the
Measurement Date is less than $4 million, the Purchaser and the Shareholder
Representative shall promptly notify the Escrow Agent in writing to such
effect, and the Escrow Agent shall, as promptly as practicable after its
receipt of such notice, release to the Purchaser the number of Post-Closing
Shares as specified in such notice. Any remaining Post-Closing Shares, if
any, will be released to the Record Holders PRO RATA in accordance with their
respective interests in the Escrow Shares as originally set forth on the
Schedule. If the Deferred Amount on the Measurement Date equals $4 million,
the Purchaser and the Shareholder Representative shall promptly notify the
Escrow Agent in writing to such effect, and the Escrow Agent shall release to
the Record Holders the number of Post-Closing Shares specified in such notice
PRO RATA in accordance with their respective interests in the Escrow Shares
as originally set forth on the Schedule.
(e) During the period ending eighteen months after the Closing Date
(the "SURVIVAL PERIOD"), the Purchaser, on behalf of any Purchaser
Indemnified Party, may make Claims from the Indemnification Shares for any
Losses in accordance with the terms of Section 1 hereof and Article IX of the
Purchase Agreement. Notwithstanding the foregoing, indemnification may be
sought after the expiration of the Survival Period pursuant to this Agreement
and Article IX of the Purchase Agreement if a Claim Notice (as defined in
Section 5 hereof) shall have been delivered to the Shareholder Representative
prior to the expiration of the Survival Period.
(f) Subject to Section 1(g) and 1(i) hereof, to the extent the
Escrow Agent has been provided with all relevant information, within four
Business Days after the termination of the Survival Period, the Escrow Agent
shall return to the Record Holders an aggregate number of Indemnification
Shares (the "REMAINING SHARES") equal to the Indemnification Shares less (i)
any Indemnification Shares previously released from escrow and delivered to
the Purchaser pursuant to the terms of this Agreement and (ii) an additional
number of Indemnification Shares sufficient to satisfy all the then pending
Claims made by the Purchaser, on behalf of the Purchaser Indemnified Parties,
for indemnification in accordance with Article IX of the Purchase Agreement.
The Escrow Agent shall return to each Record Holder such Remaining Shares in
such amounts as are indicated to the Escrow Agent in writing by the
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Shareholder Representative and to such address indicated on the most recent
version of the Schedule maintained in accordance with Section 3(b) hereof.
Upon the final determination of any pending indemnifiable Claims, the
Indemnification Shares being held pending such determination shall be
distributed by the Escrow Agent upon receipt and in accordance with the terms
of the relevant notice, memorandum or decision stipulated in Section 5 hereof.
(g) For purposes of this Agreement and Article IX of the Purchase
Agreement, the satisfaction of any indemnifiable Losses in accordance with
Section 5 hereof shall be made by delivery by the Escrow Agent to the
Purchaser of that number of Indemnification Shares as are set forth in the
relevant Claim Notice, memoranda or other written instruction from the proper
party or parties, which number of Indemnification Shares being calculated by
such party or parties by dividing the dollar amount of the Losses by the
Share Price. Notwithstanding the foregoing, at any time until the later of
(i) termination of the Survival Period, or (ii) final resolution of all
claims by Purchaser for indemnifiable Losses, the Shareholder Representative,
on behalf of any Record Holder, may elect to deposit cash in an amount equal
to all or any portion of such Record Holder's share of the Indemnification
Shares remaining in escrow, based upon the Share Price, in which event the
Escrow Agent shall release to such Record Holder the corresponding number of
such Record Holder's Indemnification Shares. In the event of any
indemnifiable Losses in accordance with Article IX of the Purchase Agreement,
any payment by the Escrow Agent to the Purchaser hereunder with respect to
any Record Holder shall first be made by the Escrow Agent through release to
the Purchaser of such Record Holder's share of the Losses represented by such
Record Holder's cash, if any, and then to the extent not satisfied therefrom,
by the Escrow Agent's delivery to the Purchaser the balance of such Record
Holder's share of such Losses from such Record Holder's Indemnification
Shares, if any, held in escrow. The Shareholder Representative, on behalf of
any Record Holder, may elect to deposit cash in substitution for a Record
Holder's share of Losses to be paid to the Purchaser in exchange for such
Record Holder's Indemnification Shares at any time prior to the time at which
the Escrow Agent releases such Indemnification Shares to the Purchaser. Any
request by the Shareholder Representative, on behalf of a Record Holder, that
Indemnification Shares be released in exchange for a deposit of cash with the
Escrow Agent pursuant to this section 1(g), shall specify the number of
shares requested to be released, and shall certify to the Escrow Agent the
Share Price used to calculate the number of shares requested to be released.
The Escrow Agent may conclusively rely on such written request and
certification of the Share Price and shall be fully protected and shall incur
no liability in reliance thereon. The Escrow Agent shall invest and reinvest
any cash substituted for Indemnification Shares (such cash, together with
earnings
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with respect thereto, the "Escrow Fund") in federally insured savings
accounts, money market accounts or secured certificates of deposit in United
States banks or securities issued or guaranteed by the United States or money
market mutual funds used in the ordinary course of business of the Escrow
Agent that invest in the vehicles described above, all as may from time to
time be directed by the Shareholder Representative prior to the final
distribution of the Escrow Fund upon termination as provided herein. All
interest and any other earnings derived from said investments of the Escrow
Fund shall accrue and be paid to Purchaser or Record Holders, as the case may
be, in proportion to the respective distributions of the underlying principal.
(h) The Escrow Agent will hold the Escrow Shares and the Escrow Fund
in accordance with the terms and conditions of this Agreement. All
obligations of the Escrow Agent hereunder shall terminate upon final delivery
of all Escrow Shares and the Escrow Fund to the appropriate party or parties
in accordance with the terms of this Agreement and Article IX of the Purchase
Agreement. This Agreement shall terminate upon final delivery of all Escrow
Shares and the Escrow Fund in accordance with the previous sentence.
(i) The Shareholder Representative shall be entitled to be
reimbursed for any out-of-pocket costs and expenses incurred by the
Shareholder Representative in connection with the Shareholder
Representative's actions taken pursuant to the terms of this Agreement by
delivering to the Escrow Agent a written claim for a specified number of
Remaining Shares which number shall be equal to the aggregate amount of such
costs and expenses divided by the Share Price. The Escrow Agent may
conclusively rely on such written claim and shall be fully protected and
shall incur no liability in reliance thereon. Notwithstanding the foregoing,
the Escrow Agent shall have no duty to or liability with respect to the
Shareholder Representative for any claim made by the Shareholder
Representative after all Remaining Shares have been distributed in accordance
with Section 1(f) above. If the Remaining Shares are not sufficient to cover
the out-of-pocket costs and expenses of the Shareholder Representative, the
Shareholder Representative may seek to recover out-of-pocket costs and
expenses against the Record Holders but not against the Purchaser or the
Company.
2. SHAREHOLDER REPRESENTATIVE
Unless and until the Purchaser and the Escrow Agent shall have
received written notice from Shareholders who initially received a majority
of the Closing Date Shares issued at the Closing Date (which notice shall
contain a certification to that effect from such Shareholders) of the
appointment of a successor Shareholder Representative for the Shareholders,
the Purchaser and the Escrow Agent shall be
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entitled to rely on, and shall be fully protected in relying on, the power
and authority of the Shareholder Representative to act on behalf of the
Shareholders. Upon receipt by the Escrow Agent of such notice (with such
certification contained therein), the Escrow Agent shall be fully protected
and shall incur no liability in relying on the power and authority of the
successor Shareholder Representative named in such notice.
3. ADMINISTRATION
(a) The Escrow Agent shall accept, hold and safeguard the Escrow
Shares and the Escrow Fund until its obligations hereunder terminate and
shall administer, hold and dispose of such shares and the Escrow Fund only in
accordance with the terms of this Agreement and as instructed in writing by
the Purchaser and the Shareholder Representative, as applicable, which
instructions shall be in accordance with this Agreement, Sections 2.4 and 2.5
of the Purchase Agreement and Article IX of the Purchase Agreement.
(b) The Escrow Agent shall keep the information set forth in the
Schedule current based on any shares of Purchaser Common Stock or portion of
the Escrow Fund released to the Purchaser or to any Record Holder or,
pursuant to Section 1(i), the Shareholder Representative, in accordance with
the terms of this Agreement, and any information supplied in writing by the
Purchaser, the Shareholder Representative or by any Record Holder in
accordance with the notice provisions of this Agreement. The Escrow Agent
shall advise the Purchaser and the Shareholder Representative in writing of
changes to the Schedule, and the Escrow Agent shall make the Schedule, as it
may be updated from time to time, available for inspection by the Purchaser
and the Shareholder Representative upon their reasonable request.
(c) Notwithstanding the escrow of the Escrow Shares, dividends or
other distributions declared and paid on such shares shall continue to be
paid by the Purchaser to the respective Shareholders in whose names the
Escrow Shares are registered and all voting rights with respect to such
shares shall inure to the benefit of and be enjoyed by such Shareholders.
Notwithstanding the foregoing, any securities received by the Escrow Agent in
respect of any Escrow Shares held in escrow as a result of any stock split,
reclassification, subdivision or combination of shares of Purchaser Common
Stock, payment of a stock dividend or other stock distribution in or on
shares of Purchaser Common Stock, or change of shares of Purchaser Common
Stock into any other securities pursuant to or as part of a merger,
consolidation, acquisition of property or stock, separation, reorganization,
or liquidation of the Purchaser, or otherwise, shall be held by the Escrow
Agent as, and shall be included within the definition of, Escrow Shares.
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4. BOOK ENTRY ADJUSTMENTS; ISSUANCE OF NEW STOCK CERTIFICATES
The Escrow Agent shall maintain book entry accounts to reflect
releases of Escrow Shares to the Purchaser pursuant to the terms of this
Agreement. When Escrow Shares are to be delivered hereunder to the Purchaser,
the Escrow Agent shall, unless the Purchaser requests that such shares be
evidenced by certificates, make appropriate book entry adjustments to the
accounts maintained by the Escrow Agent on behalf of the Purchaser and the
Shareholders to indicate the delivery of such number of Escrow Shares to the
Purchaser by the appropriate Shareholders. When Escrow Shares are to be
released from escrow and delivered hereunder to the Shareholders pursuant to
Section 1(f) hereof, the Escrow Agent shall deliver certificate(s) evidencing
the appropriate number of Escrow Shares to be so released and delivered to
the Shareholders.
5. INDEMNIFICATION AND REIMBURSEMENT PROCEDURES; CLAIMS AGAINST THE
ESCROW
5.1 INDEMNIFICATION CLAIM NOTICE
The Purchaser, on behalf of the Purchaser Indemnified Parties, shall
give written notice (a "CLAIM NOTICE") of any Claim for indemnification under
Article IX of the Purchase Agreement to the Shareholder Representative, on
behalf of the Shareholders, and to the Escrow Agent reasonably promptly after
the assertion against any Purchaser Indemnified Party of any claim by a third
party (a "THIRD PARTY CLAIM") or, if such Claim is not in respect of a Third
Party Claim, reasonably promptly after the discovery of facts upon which the
Purchaser Indemnified Party intends to base a Claim for indemnification
pursuant to Article IX of the Purchase Agreement; provided, however, that the
failure or delay to so notify the Shareholder Representative or the Escrow
Agent shall not relieve the Shareholders of any obligation or liability that
the Shareholders may have to the Purchaser Indemnified Party except to the
extent that the Shareholders demonstrate that their ability to defend or
resolve such Claim is adversely affected thereby. Any such Claim Notice shall
describe in reasonable detail the facts and circumstances on which the
asserted Claim for indemnification is based and shall include the amount of
the indemnifiable Losses (or, if such amount is not then determined, a good
faith estimate thereof), the specific number of Indemnification Shares
representing such Losses, the basis for the determination of the amount of
such Losses and, if the Claim is asserted against less than all of the
Shareholders, the identity of such Shareholders against whom the Claim is
asserted (as well as the number of Indemnification Shares allocable to each
such Shareholder). Unless, within 30 days of the receipt by the Shareholder
Representative of the Claim Notice, which satisfies the information
requirements described above, a
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Claim described in the Claim Notice is contested by the Shareholder
Representative by written notice (the "REPRESENTATIVE NOTICE") to the
Purchaser and the Escrow Agent of the amount of the Claim that is contested
and given, the Purchaser, on behalf of the Purchaser Indemnified Parties, may
recover any undisputed amount of the Claim from the Indemnification Shares.
In such event, the Escrow Agent shall, subject to any such Representative
Notice, be entitled to rely on any such Claim Notice and distribute
Indemnification Shares held in escrow to the Purchaser in accordance with the
terms hereof, the Claim Notice and any Representative Notice.
5.2 REPRESENTATIVE NOTICE
(a) If, within 30 days of the receipt by the Shareholder
Representative of the Claim Notice, the Shareholder Representative contests
in writing to the Purchaser and the Escrow Agent by means of a Representative
Notice that any of such Losses constitute an indemnifiable Claim, then the
Purchaser, on behalf of the Purchaser Indemnified Parties, and the
Shareholder Representative, acting in good faith, shall attempt to reach
agreement with respect to the contested portions of such Claim. Any such
Representative Notice shall describe in reasonable detail the facts and
circumstances on which the asserted Claim for indemnification is contested.
If the Purchaser and the Shareholder Representative should so agree, a
written memorandum setting forth such agreement shall be prepared and signed
by the Purchaser and the Shareholder Representative and shall be furnished to
the Escrow Agent (with such memorandum specifying the number of
Indemnification Shares to be released to the Purchaser and the allocation of
such Indemnification Shares vis-a-vis each Shareholder. The Escrow Agent
shall be entitled to rely on any such memorandum and distribute
Indemnification Shares and cash from the Escrow Fund held in escrow in
accordance with the terms hereof and thereof.
(b) The Shareholder Representative shall not object to any Claim
unless (i) it believes that the Purchaser Indemnified Party is not entitled
to be indemnified with respect to the Losses specified therein or (ii) it
lacks sufficient information to assess the validity or amount of the Claim.
If the Shareholder Representative objects to a Claim on the basis that it
lacks sufficient information, it shall request from the Purchaser as promptly
as practicable any additional information reasonably necessary in order for
it to assess such Claim and the Purchaser shall, to the extent the Purchaser
reasonably can, provide the additional information reasonably requested. Upon
receipt of such additional information, the Shareholder Representative shall
review it as soon as reasonably practicable and notify the Purchaser and the
Escrow Agent of any withdrawal or modification of the objection.
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(c) If the Purchaser and the Shareholder Representative are unable
to reach agreement with respect to any contested Claim within 45 days of the
delivery of the Representative Notice, the matter shall be settled by binding
arbitration as set forth below. All claims shall be settled in accordance
with the Commercial Arbitration Rules then in effect of the American
Arbitration Association (the "AAA RULES"). All of the fees and expenses of
the arbitrator shall be paid by the party who does not prevail in the
arbitration, with the Purchaser paying such expenses on behalf of any
Purchaser Indemnified Parties who do not prevail in the arbitration, and the
Shareholder Representative paying such expenses on behalf of any Shareholders
who do not prevail in the arbitration. Until resolution of the dispute, the
Purchaser and the Shareholder Representative (on behalf of the Shareholders,
who shall contribute to such payment in proportion to the number of Escrow
Shares owned by each) shall each pay for one-half of the fees and expenses of
the arbitrator, subject to recoupment in accordance with the preceding
sentence. The Shareholder Representative and the Purchaser shall cause the
arbitrator to decide the matter to be arbitrated pursuant hereto within 30
days after the appointment of the arbitrator. The arbitrator's decision shall
relate solely to whether the Purchaser Indemnified Party is entitled to be
indemnified for the contested Claim, or the contested portion thereof,
pursuant to the applicable terms of this Agreement. The final decision of the
arbitrator shall be furnished to the Shareholder Representative, the
Purchaser and the Escrow Agent in writing, shall constitute the conclusive
determination of the issue in question, shall set forth the specific number
of Indemnification Shares to be delivered to the Purchaser, shall be binding
upon the Shareholder Representative, the Shareholders, the Purchaser, and the
Purchaser Indemnified Party, and shall not be contested by any of them. Such
decision may be used in a court of law only for the purpose of seeking
enforcement of the arbitrator's decision. Upon receipt of the decision, the
Escrow Agent shall be entitled to rely on the decision and shall, to the
extent required to satisfy any indemnification obligations under Article IX
of the Purchase Agreement, distribute Indemnification Shares held in escrow
to the Purchaser, on behalf of the Purchaser Indemnified Party, in accordance
with the terms of the decision.
In addition to the other permitted distributions of Escrow Shares
and cash set forth herein, the Escrow Agent shall distribute Escrow Shares
and cash held in escrow in accordance with the terms of a written memorandum
signed by the Purchaser and the Shareholder Representative, any of which
shall set forth the specific number of Escrow Shares to be distributed.
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6. PROVISIONS REGARDING THE ESCROW AGENT
6.1 LIABILITY OF THE ESCROW AGENT
The duties of the Escrow Agent hereunder are purely ministerial in
nature. In performing any duties under this Agreement, the Escrow Agent shall
not be liable to any party for any losses, claims, damages, liabilities or
expenses, except for gross negligence, willful misconduct or bad faith on the
part of the Escrow Agent (which for all purposes of any Section of this
Agreement shall each be as finally determined by a court of competent
jurisdiction or by binding arbitration). The Escrow Agent shall be fully
protected in relying on and shall not incur any liability for any action
taken, suffered or omitted to be taken in reliance on any instrument,
including any written statement or affidavit provided for in this Agreement
that the Escrow Agent shall believe to be genuine and provided that the
Escrow Agent acted without gross negligence, willful misconduct or bad faith,
nor will the Escrow Agent be liable or responsible for the forgeries, fraud,
impersonations of others, or determining the scope of any representative
authority, provided that the Escrow Agent believed that such forgeries,
fraud, or impersonations were genuine and acted without gross negligence,
willful misconduct or bad faith. In addition, the Escrow Agent may consult
with legal counsel in connection with the Escrow Agent's duties under this
Agreement and shall be fully protected in any act taken, suffered, or omitted
to be taken by it in good faith in accordance with the advice of counsel;
provided that the Escrow Agent exercised reasonable care in the selection of
such counsel. The Escrow Agent is not responsible for determining and
verifying the authority of any person acting or purporting to act on behalf
of any party to this Agreement. The Escrow Agent shall have the right to
perform any of its duties hereunder through agents, custodians or nominees,
and the Escrow Agent shall not be liable or responsible for any misconduct or
negligence on the part of any such agent, custodian or nominee absent gross
negligence, willful misconduct or bad faith on the part of the Escrow Agent
in the selection and continued employment thereof.
6.2 FEES AND EXPENSES
It is understood that the fees, expenses and usual charges agreed on
for services of the Escrow Agent shall be considered compensation for
ordinary services as contemplated by this Agreement. In the event that the
conditions of this Agreement are not promptly fulfilled, or if the parties
request a substantial modification of its terms (and the Escrow Agent agrees
to such modification), or if any controversy arises, or if the Escrow Agent
is made a party to, or intervenes in, any litigation pertaining to this
escrow or its subject matter, the Escrow Agent shall be reasonably
compensated for such extraordinary services and shall be reimbursed for all
costs,
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reasonable attorneys' fees and expenses occasioned by such default, delay,
modification, controversy, or litigation and the Escrow Agent shall have the
right to retain all documents and/or other things of value at any time held
by the Escrow Agent in this escrow until such compensation, fees, costs, and
expenses are paid. The Purchaser shall pay for the Escrow Agent's fees and
expenses incurred in connection with this Agreement, and the Shareholder
Representative shall reimburse the Purchaser for half of the Escrow Agent's
fees and expenses incurred in connection with this Agreement.
6.3 CONTROVERSIES
If any controversy arises between the parties to this Agreement, or
with any other party, concerning the subject matter of this Agreement, its
terms or conditions, 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 other items of value held in escrow and may wait for settlement
of any such controversy by agreement by the parties as provided by Section 5.
In such event, the Escrow Agent will not be liable to any person or entity
for interest or damage, except for its gross negligence or willful
misconduct. The Escrow Agent is authorized to deposit with the arbitrator for
such controversy all documents and other items of value held in escrow. Upon
deposit of all such documents and items of value with such arbitrator, the
Escrow Agent shall be fully released and discharged of and from all
obligations and liability imposed by the terms of this Agreement. The party
who does not prevail in the arbitration shall be responsible for all costs,
expenses, charges, and reasonable attorneys' fees incurred by the Escrow
Agent due to the arbitration action; provided, however, that notwithstanding
the foregoing, the Purchaser shall be ultimately responsible to the Escrow
Agent for such costs, expenses, charges and fees to the extent the
non-prevailing party does not timely pay such to the Escrow Agent.
In addition, in the event of any dispute between the parties to this
Escrow Agreement, or between any of them and any other person, resulting in
adverse claims or demands being made upon any of the Escrow Shares, or in the
event that the Escrow Agent, in good faith, is in doubt as to what action it
should take hereunder, the Escrow Agent may, at its option, file a suit as
interpleader in a court of appropriate jurisdiction, or refuse to comply with
any claims or demands on it, or refuse to take any other action hereunder, so
long as such dispute shall continue or such doubt shall exist. The Escrow
Agent shall be entitled to continue so to refrain from acting until (i) the
rights of all parties have been fully and finally adjudicated by a court of
appropriate jurisdiction or by binding arbitration or (ii) all differences
and such doubt shall have been resolved by agreement among all of the
interested persons, and the
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Escrow Agent shall have been notified of such agreement in writing signed by
all such persons. The rights of the Escrow Agent under this Section are
cumulative of all other rights which it may have by law or otherwise.
6.4 INDEMNIFICATION OF THE ESCROW AGENT
The Purchaser and the Shareholders shall, jointly and severally,
indemnify the Escrow Agent for, and hold it harmless against, any loss,
liability, claim, cost, settlement, judgment, damage, fine, penalty, demand
or expense, including reasonable attorney's fees, arising out of or in
connection with its execution of this Agreement or its performance of its
duties under this Agreement, including the costs and expenses of defending
itself against any such loss, liability, claim, cost, settlement, judgment,
damage, fine, penalty, demand or expense in connection herewith, unless such
loss, liability, claim, cost, settlement, judgment, damage, fine, penalty,
demand or expense shall have been finally determined by a court of competent
jurisdiction or by binding arbitration to be a result of the Escrow Agent's
gross negligence or willful misconduct. Anything in this Agreement to the
contrary notwithstanding, in no event shall the Escrow Agent be liable for
special, indirect, punitive, incidental or consequential loss or damage of
any kind whatsoever (including but not limited to lost profits), even if
Escrow Agent has been advised of the likelihood of such damages and
regardless of the form of action. Any liability of the Escrow Agent will be
limited to the amount of fees and expenses paid to the Escrow Agent
hereunder. The obligations of the Purchaser and the Shareholders under this
Section and Section 6.2 shall survive termination of this Agreement and the
resignation or substitution of the Escrow Agent.
6.5 RESIGNATION OF THE ESCROW AGENT
The Escrow Agent may resign at any time upon giving at least 30
days' written notice to the Purchaser and the Shareholder Representative;
PROVIDED, HOWEVER, that no such resignation shall become effective until the
appointment of a successor escrow agent, which shall be accomplished as
follows: the Purchaser and the Shareholder Representative shall use their
best efforts to mutually agree on a successor escrow agent within 30 days
after receiving such notice. If the Purchaser and the Shareholder
Representative fail to agree on a successor escrow agent within such time,
the Escrow Agent shall have the right to appoint a successor escrow agent,
which successor escrow agent shall be reasonably acceptable to the Purchaser
and the Shareholder Representative. The successor escrow agent shall execute
and deliver an instrument accepting such appointment and it shall, without
further acts, be vested with all the estates, properties, rights, powers and
duties of the predecessor escrow agent as if originally named as escrow
agent. Upon the effective appointment of a successor escrow agent, the Escrow
Agent shall be discharged from any further duties
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and liability under this Agreement. If a successor escrow agent is not
appointed within the above time frames, then the Escrow Agent may apply to a
court of competent jurisdiction for appointment of a successor escrow agent.
7. ABANDONMENT OF SALE
In the event that the Purchase Agreement is terminated and the Sale
abandoned pursuant to Article VIII of the Purchase Agreement, the Purchaser
shall pay the Escrow Agent's reasonable costs and expenses incurred in
connection with this Agreement, and the Shareholders shall reimburse the
Purchaser for half of the Escrow Agent's reasonable costs and expenses
incurred in connection with this Agreement, with each Shareholder bearing its
PRO RATA (based upon its PRO RATA share of the Escrow Shares) share of such
costs and expenses.
8. REPRESENTATIONS AND WARRANTIES
Each of the parties hereto represents and warrants with respect to
itself only as follows: (i) that it has full power and authority to execute,
deliver and perform its obligations under this Agreement; (ii) that all
action on the part of such party necessary for the due authorization,
execution, delivery and performance of this Agreement, the consummation of
the transactions contemplated hereby, and the performance of each party's
obligations hereunder has been taken; (iii) that this Agreement has been duly
authorized, executed and delivered by such party; and (iv) that this
Agreement is a legal, valid and binding obligation of such party, enforceable
against such party in accordance with its terms.
9. AMENDMENTS
This Agreement may not be amended except by an instrument signed by
the Purchaser and the Shareholder Representative. No such amendment shall be
effective to alter or enlarge the Escrow Agent's rights, duties, discretion
and obligations hereunder without its prior written consent, and each of the
Shareholders has granted to the Shareholder Representative the authority and
discretion, so long as such authority and discretion is exercised in good
faith, to enter into such amendments as he chooses in the exercise of such
discretion.
10. NOTICES
Any notice, request or demand desired or required to be given
hereunder shall be in writing given by personal delivery, certified or
registered mail, confirmed facsimile transmission, or overnight courier
service, in each case addressed as respectively set forth below or to such
other address as any party shall have previously
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designated by such a notice. The effective date of any notice, request or
demand shall be the date of personal delivery, three days after the date of
mailing by certified or registered mail, the date on which successful
facsimile transmission is confirmed, or the date actually delivered by a
reputable overnight courier service, as the case may be, in each case
properly addressed as provided herein and with all charges prepaid.
TO CORILLIAN:
Corillian Corporation
0000 XX Xxxx Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Fax: (503)
Attention: Xxxxx X. Xxxxx
with a copy to:
Xxxxxxx Coie LLP
0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxx, Xxxxxx 00000
Fax: (000) 000-0000
Attention: Xxx X. Xxxxxx
TO THE SHAREHOLDER REPRESENTATIVE:
Xxxxx X. Xxxxxxx
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
with a copy to:
Xxxxxxxx, Xxxxxxx & Xxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
Xxxxxx, Xxxxx & Davidoff Incorporated
0000 Xxxxxx xx xxx Xxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Fax: (000) 000-0000
Attention: Xxxx Xxxxxxxxx
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TO THE ESCROW AGENT:
ChaseMellon Shareholder Services, L.L.C.
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Relationship Manager
Facsimile No.: (000) 000-0000
with a copy to:
ChaseMellon Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, XX 00000
Attention: General Counsel
Facsimile No.: (000) 000-0000
11. SEVERABILITY
If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law, or public policy, all
other conditions and provisions of this Agreement shall nevertheless remain
in full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner adverse to any
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible in a mutually acceptable manner in order
that the transactions contemplated hereby be consummated as originally
contemplated to the fullest extent possible.
12. ENTIRE AGREEMENT
This Agreement, the Purchase Agreement and each of the agreements,
certificates, instruments and documents to be executed or delivered pursuant
to the terms of the Purchase Agreement constitute the entire agreement among
the parties with respect to the subject matter hereof and thereof and
supersede all prior agreements and undertakings, both written and oral, among
the parties, or any of them, with respect to the subject matter hereof and
thereof.
13. PARTIES IN INTEREST
Except with respect to the Shareholders, who are intended to be
third party beneficiaries, this Agreement shall be binding upon and inure
solely to the benefit of
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each party hereto, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement.
14. GOVERNING LAW
This Agreement shall be governed by, and construed in accordance
with, the laws of the State of California applicable to contracts executed in
and to be performed in that State; provided, however, that all provisions
regarding the rights, duties and obligations of the Escrow Agent shall be
governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed entirely within such
State.
15. HEADINGS
The descriptive headings contained in this Agreement are included
for convenience of reference only and shall not affect in any way the meaning
or interpretation of this Agreement.
16. ASSIGNMENT
This Agreement shall not be assigned by operation of law or
otherwise, without the prior written consent of the other parties (acting in
the case of the Shareholders through the Shareholder Representative);
PROVIDED, HOWEVER, that the Purchaser may assign all or any of its rights and
obligations hereunder to any of its affiliates or to any entity that acquires
substantially all of the assets of the Purchaser, whether by merger or sale.
17. SPECIFIC PERFORMANCE
Each of the parties acknowledges and agrees that the other parties
hereto would be damaged irreparably in the event any of the provisions of
this Agreement are not performed in accordance with their specific terms or
otherwise are breached. Accordingly, each of the parties hereto agrees that
the other parties hereto will be entitled to an injunction to prevent
breaches of the provisions of this Agreement and to enforce specifically this
Agreement and the terms and provisions of this Agreement (including the
indemnification provisions hereof) in any competent court having jurisdiction
over the parties, in addition to any other remedy to which they might be
entitled at law or in equity.
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18. FURTHER ASSURANCES
Each party (acting in the case of the Shareholders through the
Shareholder Representative) will, at the reasonable request of any other
party hereto, from time to time execute and deliver such other assignments,
transfers, conveyances, and other instruments and documents and do and
perform such other acts and things as may be reasonably necessary or
desirable for effecting complete consummation of this Agreement and the
transactions contemplated hereby.
19. COUNTERPARTS
This Agreement may be executed and delivered in one or more
counterparts, and by the different parties hereto in separate counterparts,
each of which when executed and delivered will be deemed to be an original
but all of which taken together will constitute one and the same agreement.
To expedite the process of entering into this Agreement, the parties
acknowledge that Transmitted Copies of this Agreement will be equivalent to
original documents until such time as original documents are completely
executed and delivered. "TRANSMITTED COPIES" will mean copies that are
reproduced or transmitted via photocopy, facsimile, or other process of
complete and accurate reproduction and transmission.
[Remainder of this page intentionally left blank.]
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IN WITNESS WHEREOF, the parties have executed this Escrow Agreement on
the date first written above.
CORILLIAN CORPORATION
By: ___________________________________
Name: _________________________________
Title: ________________________________
SHAREHOLDER REPRESENTATIVE,
as agent and representative
of the Shareholders listed
on Schedule A:
_______________________________________
Xxxxx X. Xxxxxxx
ESCROW AGENT:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
By: ___________________________________
Its:
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SHAREHOLDERS:
*XXXXX X. XXXXXXX AND XXXXXX X. XXXXXXX
FAMILY TRUST
*SUMMIT VENTURES IV, L.P.
*SUMMIT VENTURES V, L.P.
*SUMMIT INVESTORS III, L.P.
*SUMMIT V ADVISORS FUND, L.P.
*SUMMIT V ADVISORS FUND (QP), L.P.
*SUMMIT V COMPANION FUND, L.P.
*IT CAPITAL PARTNERS LLC
*SHRIMPTON FAMILY TRUST
*X. XXXXX ASSOCIATES, INC.
*XXXXX XXXXXX
*XXXXXX XXXX
*XXXXXX XXXXXXXX
*By: __________________________________
Xxxxx X. Xxxxxxx, as attorney-in-fact
and Shareholder Representative
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SCHEDULE A
CLOSING DATE: NOVEMBER 24, 2000
SHAREHOLDER ESCROW SHARES
SUMMIT VENTURES IV, L.P. 113,973
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
SUMMIT VENTURES V, L.P. 97,647
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
SUMMIT INVESTORS III, L.P. 10,136
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
SUMMIT V ADVISORS FUND, L.P 1,998
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
SUMMIT V ADVISORS FUND (QP), L.P. 6,532
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
SUMMIT V COMPANION FUND, L.P. 16,326
c/o Summit Partners
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
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IT CAPITAL PARTNERS LLC 61,652
Two Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Fax: 000-000-0000
XXXXXXX FAMILY TRUST 161,523
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
SHRIMPTON FAMILY TRUST 8,143
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
X. XXXXX ASSOCIATES, INC. 8,342
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
XXXXX XXXXXX 17,100
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
XXXXXX XXXX 17,100
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
XXXXXX XXXXXXXX 1,335
c/x Xxxxxxx Associates Inc.
1801 Avenue of the Stars
Xxxxx 000
Xxx Xxxxxxx, XX 00000-0000
-------------------------------------------------------------------------------------------------------------
TOTAL 521,807
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