EXHIBIT 4.4
ESCROW AGREEMENT
This ESCROW AGREEMENT (this "Agreement"), dated as of December 1,
---------
1999, by and among STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., a
national banking association, as escrow agent and securities intermediary (in
such capacities, "Escrow Agent"), STATE STREET BANK AND TRUST COMPANY OF
------------
CALIFORNIA, N.A., as Trustee (in such capacity, "Trustee") under the Indenture
-------
(as defined herein), and EQUINIX, INC., a Delaware corporation ("Company").
-------
R E C I T A L S :
A. Pursuant to the Indenture, dated as of December 1, 1999 (the
"Indenture"), by and between the Company and Trustee, the Company is issuing
---------
$200,000,000 principal amount of its 13% Senior Notes due 2007 (the
"Securities") as part of the offering of 200,000 units (the "Units") consisting
---------- -----
of the Securities and warrants to purchase 2,251,000 shares of Common Stock, par
value $.001 per share, of the Company.
B. As security for its obligations under the Securities and the
Indenture, the Company hereby grants to Trustee, for the benefit of the holders
of the Securities, a Lien upon the Escrow Account (as defined herein) on the
terms and conditions set forth herein.
C. The parties have entered into this Agreement in order to set forth
their security agreement with respect to the Lien described above and the
conditions upon which, and the manner in which, funds will be disbursed from the
Escrow Account and released from such Lien.
A G R E E M E N T :
- - - - - - - - -
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Defined Terms. All terms used but not defined herein shall have
-------------
the respective meanings ascribed to them in the Indenture. In addition to any
other defined terms used herein, the following terms shall constitute defined
terms for purposes of this Agreement and shall have the meanings set forth
below:
"Affiliate" of any specified person means any other Person which,
---------
directly or indirectly, controls, is controlled by or is under common control
with such specified Person. For the purposes of this definition, "control" when
used with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise and the terms "affiliated,"
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agreement" means this Escrow Agreement, as amended from time to time.
---------
"Applied" means that disbursed funds have been applied (i) to the
-------
payment of interest on the Securities, (ii) pursuant to Section 3(c), or (iii)
pursuant to Section 6(b)(iii) hereof.
"Available Funds" means, at any date, (A) the sum of (i) the Pledged
---------------
Securities and any funds and (ii) interest earned or dividends paid on the
Pledged Securities and any funds, less (B) the aggregate disbursements made
----
prior to such date pursuant to this Agreement.
"Beneficiaries" see Section 2(b).
-------------
"Book-Entry Securities" means Securities maintained in the form of
---------------------
entries (including, without limitation, the Securities Entitlements in such
Securities) in the commercial book-entry system of the Federal Reserve Bank of
Boston.
"Business Day" means any day that is not a Saturday, a Sunday or a day
------------
on which banking institutions in California, Boston or Los Angeles are required
by law, regulation or executive order to remain closed.
"Company" see the introductory paragraph hereto.
-------
"Company Funds" see Section 3(c).
-------------
"Entitlement Holder" means an "Entitlement Holder" as defined (i) in
------------------
Section 8 102(a)(7) of the Revised UCC and (ii) with respect to Book-Entry
Securities governed by the Federal Book-Entry Regulations, in 31 C.F.R. (S)
357.2.
"Escrow Account" means the escrow account established pursuant to
--------------
Section 2.
"Escrow Account Statement" see Section 2(f).
------------------------
"Escrow Agent" see the introductory paragraph hereto.
------------
"Escrow Collateral" see Section 6(a).
-----------------
"Escrow Funds" see Section 6(c).
------------
"Fed Member Securities Account" means, in respect of any Person, an
-----------------------------
account in the name of such Person in the commercial book-entry system of the
Federal Reserve Bank of Boston.
"Federal Book-Entry Regulations" means (i) the federal regulations
------------------------------
contained in Subpart B ("Treasury/Reserve Automated Debt Entry System (TRADES)
governing Book-Entry Securities consisting of U.S. Treasury bonds, notes and
bills and Subpart D ("Additional Provisions")) of 31 C.F.R. Part 357, 31 C.F.R.
---------------------
(S) 357.10 through (S) 357.41 and (S) 357.41 through (S) 357.44, including
related defined terms in 31 C.F.R. (S) 357.27; and (ii) to the extent
substantially identical to the Federal Book-Entry Regulations referred to in
clause (i) above, the federal regulations governing other Book-Entry Securities.
2
"Financial Asset" has the meaning set forth in Section 8-102(a) of the
---------------
Revised UCC.
"Government Securities" means direct obligations of, or obligations
---------------------
guaranteed by, the United States of America for the payment of which obligations
the full faith and credit of the United States is pledged.
"Indenture" see the recitals hereto.
---------
"Initial Escrow Amount" shall mean $37,011,520.
---------------------
"Interest Payment Date" means June 1 and December 1 of each year,
---------------------
commencing on June 1, 2000 until the Securities are paid in full.
"Payment Notice and Disbursement Request" means a notice sent by the
---------------------------------------
Company to Escrow Agent requesting a disbursement of funds from the Escrow
Account, in substantially the form of Exhibit A hereto. Each Payment Notice and
---------
Disbursement Request shall be signed by an officer of the Company.
"Pledged Securities" means the Government Securities, as more fully
------------------
described on Schedule I attached hereto, purchased by the Company (or by Xxxxxxx
Xxxxx Xxxxxx Inc. at the direction of the Company), deposited with the Escrow
Agent with a portion of the net proceeds from the offering of the Units and
deposited into the Escrow Account.
"Revised UCC" means the Uniform Commercial Code as in effect in the
-----------
State of California.
"Secured Obligations" see Section 6(a).
-------------------
"Securities" see the recitals hereto.
----------
"Securities Intermediary" has the meaning specified (i) in Section 8
-----------------------
102(a)(14) of the Revised UCC and (ii) with respect to Book-Entry Securities
governed by the Federal Book-Entry Regulations, in 31 C.F.R. (S) 357.2.
"Securities Intermediary's Jurisdiction" has the meaning specified (i)
--------------------------------------
in Section 8 110(e) of the Revised UCC and (ii) with respect to Book-Entry
Securities in, 31 C.F.R. (S) 357.11(b).
"Securities Account" has the meaning set forth in Revised UCC Section
------------------
8 501(a).
"Security Control" means "Control" as defined in Section 9115(e) of
----------------
the Revised UCC.
"Security Entitlement" has the meaning specified in (i) Sections 8
--------------------
102(a)(17) of the Revised UCC and (ii) with respect to Book-Entry Securities
governed by the Federal Book-Entry Regulations, 31 C.F.R. (S) 357.2.
3
"Trustee" see the introductory paragraph hereto.
-------
2. Escrow Account; Escrow Agent
----------------------------
(a) Appointment of Escrow Agent. The Company and Trustee hereby
---------------------------
appoint Escrow Agent, and Escrow Agent hereby accepts appointment, as escrow
agent, under the terms and conditions of this Agreement.
(b) Establishment of Escrow Account.
-------------------------------
(i) On the Issue Date, Escrow Agent shall establish an escrow
account in the name of the Trustee entitled the "Escrow Account by Equinix, Inc.
to State Street Bank and Trust Company of California, N.A., Trustee" (the
"Escrow Account") at its corporate trust office located at 000 Xxxx 0xx Xxxxxx,
--------------
00xx Xxxxx, Xxx Xxxxxxx, XX 00000. The Escrow Account shall be maintained by
Escrow Agent as a Securities Account. All funds, including the Initial Escrow
Amount and the Pledged Securities shall be held by the Escrow Agent for the
exclusive benefit of Trustee, any predecessor Trustee under the Indenture and
holders of the Securities, as secured parties hereunder (collectively, the
"Beneficiaries") and shall be treated as Financial Assets. The Trustee will be
-------------
entitled to all rights and remedies to which a Person in control of Financial
Assets is entitled pursuant to Chapter 5 of Article 8 and Article 9 of the
Revised UCC. All such funds shall be held in the Escrow Account until disbursed
or paid in accordance with the terms hereof. Without limiting the foregoing, if
at any time Escrow Agent shall receive an "entitlement order" (as such term is
defined in Section 8 102(a)(8) of the Revised UCC) issued by Trustee and
relating to the Escrow Account, Escrow Agent shall comply with such entitlement
order without further consent of the Company or any other Person and will accept
"entitlement orders" from no other party. The Trustee has and will have
exclusive (and no other Person has or will have any) Security Control over the
Escrow Account and all assets, properties and items from time to time deposited
or credited thereto.
(ii) On the Issue Date, the Company shall purchase, or cause
the purchase of, the Pledged Securities with all of the Initial Escrow Amount,
and deliver, or cause the delivery of, the Pledged Securities to Escrow Agent
for deposit into the Escrow Account against Escrow Agent's written
acknowledgment and receipt of the Initial Escrow Amount. The Pledged Securities
shall be held by Escrow Agent and deposited into the Escrow Account for the
exclusive benefit of the Beneficiaries. All payments of interest and principal
on the Pledged Securities shall be deposited into the Escrow Account to be paid
or disbursed in accordance with the terms hereof.
(c) Escrow Agent Compensation. The Company shall pay to
-------------------------
Escrow Agent such compensation for services to be performed by it under this
Agreement as the Company and Escrow Agent may agree in writing from time to
time. Escrow Agent shall be paid any compensation owed to it directly by the
Company and shall not disburse from the Escrow Account any such amounts nor
shall Escrow Agent have any interest in the Escrow Account with respect to such
amounts.
The Company shall reimburse Escrow Agent upon request for all
reasonable expenses, disbursements, and advances incurred or made by Escrow
Agent in implementing any
4
of the provisions of this Agreement, including compensation and the reasonable
expenses and disbursements of its counsel. Escrow Agent shall be paid any such
expenses owed to it directly by the Company and shall not disburse from the
Escrow Account any such amounts nor shall Escrow Agent have any interest in the
Escrow Account with respect to such amounts.
(d) Investment of Funds in Escrow Account. Any funds on deposit in
-------------------------------------
the Escrow Account which are not invested may be reinvested, at the Company's
option, only upon the following terms and conditions:
(i) Acceptable Investments. All funds deposited or held in the
----------------------
Escrow Account at any time shall be invested by Escrow Agent in Government
Securities in accordance with the Company's written instructions from time to
time to Escrow Agent; provided, however, that (1) the Company shall only
-------- -------
designate investment of funds in Government Securities maturing in an amount
sufficient to and/or generating interest income sufficient to, when added to the
balance of funds held in the Escrow Account, provide for the payment of interest
on the outstanding Securities on each Interest Payment Date beginning on and
including June 1, 2000 and through and including the Interest Payment Date on
June 1, 2001, and, and the Company shall designate, and hereby designates, that
all cash which may from time to time be placed or deposited in or credited,
transferred or delivered to such Escrow Account, be invested as promptly as and
to the fullest extent practicable in Government Securities and (2) any such
written instruction shall specify the particular investment to be made, shall
state that such investment is authorized to be made hereby and in particular
satisfies the requirements of the preceding clause (1) of this proviso, shall
contain the certification referred to in Section 2(d)(ii), if required, and
shall be executed by an Officer of the Company. Escrow Agent shall have no
responsibility for determining whether funds held in the Escrow Account shall
have been invested in such a manner so as to comply with the requirements of
this clause (i). All Government Securities shall be assigned to and held in the
possession of, or, in the case of Government Securities maintained in book entry
form with the Federal Reserve Bank (i.e., TRADES), transferred to a book entry
account in the name of Escrow Agent for the benefit of the Beneficiaries, with
such guarantees as are customary, except that Government Securities maintained
in book entry form with the Federal Reserve Bank shall be transferred to a book
entry account in the name of Escrow Agent at the Federal Reserve Bank that
includes only Government Securities held by Escrow Agent for its customers and
segregated by separate recordation in the books and records of Escrow Agent.
Escrow Agent shall not be liable for losses on any investments made by it
pursuant to and in compliance with such written instructions. In the absence of
instructions from the Company that meet the requirements of this Section
2(d)(i), Escrow Agent shall have no obligation to invest funds held in the
Escrow Account.
(ii) Security Interest in Investments. No investment of funds in
--------------------------------
the Escrow Account shall be made unless the Company has certified to Escrow
Agent and Trustee that, upon such investment, Trustee will have a first priority
perfected security interest in the applicable investment. If a certificate as to
a class of investments has been provided to Escrow Agent, a certificate need not
be issued with respect to individual investments in securities in that class if
the certificate applicable to the class remains accurate with respect to such
individual investments, which continued accuracy Escrow Agent may conclusively
assume. On the date of this Agreement, and on each anniversary thereof, until
the date upon which the
5
balance of the Available Funds shall have been reduced to zero, each of Trustee
and Escrow Agent shall receive an Opinion of Counsel to the Company, dated each
such date as applicable, which opinion shall meet the requirements of Section
314(b) of the United States Trust Indenture Act of 1939, as amended and shall
comply with Section 11.01(d) of the Indenture.
(iii) Interest and Dividends. All interest earned and dividends
----------------------
paid on the Pledged Securities or any funds invested in Government Securities
shall be deposited in the Escrow Account as additional Escrow Collateral for the
exclusive benefit of the Beneficiaries and, if not required to be disbursed in
accordance with the terms hereof, subject to subsections 6(b)(iii), 6(e) and
6(f), shall be reinvested in accordance with the terms hereof at the Company's
written instruction unless a Default or Event of Default has occurred or Trustee
has notified Escrow Agent that it should only take direction from Trustee or
should no longer take direction from the Company. For tax reporting purposes,
all interest earned and dividends received shall be allocable to the Company.
(iv) Limitation on Escrow Agent's Responsibilities. Escrow
---------------------------------------------
Agent's sole responsibilities under this Section 2 shall be (A) to retain
possession of funds and to be the registered or designated owner of the Pledged
Securities, (B) to follow the Company's written instructions given in accordance
with Section 2(d)(i), and (C) to invest and reinvest funds pursuant to this
Section 2(d). In connection with clause (A) above, Escrow Agent will maintain
continuous possession in the jurisdiction of its principal place of business of
funds included in the Escrow Collateral and will cause the Pledged Securities to
be registered in the book-entry system of, and transferred to an account of
Escrow Agent or a sub-agent of Escrow Agent at, any Federal Reserve Bank. Except
as provided in Section 6, Escrow Agent shall have no other responsibilities with
respect to perfecting or maintaining the perfection of the security interest in
the Escrow Collateral and shall not be required to file any instrument, document
or notice in any public office at any time or times. The provisions of this
Section 2(d)(iv) shall be without prejudice to the Escrow Agent's obligations as
Securities Intermediary under this Agreement.
(e) Substitution of Escrow Agent. Escrow Agent may resign by giving
----------------------------
no less than 25 days' prior written notice to the Company and Trustee. Such
resignation shall take effect upon the later to occur of (i) delivery of all
funds and the Pledged Securities maintained by Escrow Agent hereunder and copies
of all books, records, plans and other documents in Escrow Agent's possession
relating to such funds, the Pledged Securities or this Agreement to a successor
escrow agent mutually approved by the Company and Trustee (which approvals shall
not be unreasonably withheld or delayed) and the taking of such other steps as
may be necessary to give the successor escrow agent a first priority security
interest in the Pledged Securities and (ii) the Company, Trustee and such
successor escrow agent entering into this Agreement or any written successor
agreement no less favorable to the interests of the Company, holders of the
Securities and Trustee than this Agreement; and Escrow Agent shall thereupon be
discharged of all obligations under this Agreement and shall have no further
duties, obligations or responsibilities in connection herewith, except as set
forth in Section 4. If a successor escrow agent has not been appointed or has
not accepted such appointment within 30 days after notice of resignation is
given to the Company, Escrow Agent may at the sole cost of the Company apply to
a court of competent jurisdiction for the appointment of a successor escrow
agent.
6
(f) Escrow Account Statement. At least 30 days prior to each Interest
------------------------
Payment Date, Escrow Agent shall deliver to the Company and Trustee a statement
setting forth with reasonable particularity the balance of funds then in the
Escrow Account and the manner in which such funds are invested ("Escrow Account
--------------
Statement"). The parties hereto irrevocably instruct Escrow Agent that on the
---------
first date upon which the balance in the Escrow Account is reduced to zero,
Escrow Agent shall deliver to the Company and to Trustee a notice that the
balance in the Escrow Account has been reduced to zero.
3. Disbursements.
-------------
(a) Payment Notice and Disbursement Request; Disbursements. At least
------------------------------------------------------
five Business Days prior to an Interest Payment Date, the Company may submit to
Escrow Agent, with a copy to Trustee, a completed Payment Notice and
Disbursement Request.
Escrow Agent's disbursement pursuant to any Payment Notice and Disbursement
Request shall be subject to the satisfaction of the applicable conditions set
forth in Section 3(b). Provided such Payment Notice and Disbursement Request is
not rejected by it as a result of the nonsatisfaction of the conditions set
forth in Section 3(b), Escrow Agent, as soon as reasonably practicable on the
Interest Payment Date, but in no event later than 12:00 Noon (New York City
time) on the Interest Payment Date, shall disburse the funds requested in such
Payment Notice and Disbursement Request by wire or book-entry transfer of
immediately available funds to the account of Trustee for the benefit of the
Beneficiaries or the Company in accordance with Section 3(c), as applicable.
Escrow Agent shall notify the Company and Trustee as soon as reasonably possible
(but not later than two (2) Business Days from the date of receipt of the
Payment Notice and Disbursement Request) if any Payment Notice and Disbursement
Request is rejected and the reason(s) therefor. In the event such rejection is
based upon nonsatisfaction of the condition in Section 3(b)(I), the Company
shall thereupon resubmit the Payment Notice and Disbursement Request with
appropriate changes.
(b) Conditions Precedent to Disbursement. Escrow Agent's payment of
------------------------------------
any disbursement shall be made only if: (I) the Company shall have submitted,
in accordance with the provisions of Section 3(a), a completed Payment Notice
and Disbursement Request to Escrow Agent with blanks appropriately filled in,
and (II) Escrow Agent shall not have received any notice from Trustee that as a
result of an Event of Default the indebtedness represented by the Securities has
been accelerated and has become due and payable in accordance with the terms of
the Indenture (in which event Escrow Agent shall apply all Available Funds as
required by Section 6(b)(iii)).
(c) Company Payments. If the Company makes any interest payment or
----------------
portion of an interest payment on the Securities from a source of funds other
than the Escrow Account ("Company Funds"), the Company may, after payment in
-------------
full of such interest payment, direct Escrow Agent to release to the Company or
at the direction of the Company an amount of funds from the Escrow Account less
than or equal to the amount of the Company Funds so expended. Upon receipt of a
request from the Company (including the certificate described in the following
sentence and with a copy to the Trustee), Escrow Agent will pay over to the
Company the requested amount. Concurrently with any release of funds to the
Company pursuant to this Section 3(c), the Company will deliver to Escrow Agent
a certificate signed by
7
an authorized signatory of the Company referencing this Section 3(c) and stating
that such release is permitted by this Section 3(c) and has been duly authorized
by all necessary corporate action, and does not contravene, or constitute a
default under, any provision of applicable law or regulation or of the
Certificate of Incorporation of the Company or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Company or result
in the creation or imposition of any Lien on any assets of the Company.
(d) If at any time the principal of and interest on the Escrow
Collateral exceeds 100% of the amount sufficient, in the written opinion of a
nationally recognized firm of independent accountants selected by the Company
and delivered to Escrow Agent and Trustee, to provide for payment in full of the
interest on outstanding Securities on each Interest Payment Date beginning on
and including June 1, 2000, and through and including the Interest Payment Date
on June 1, 2001 (or, in the event one or more interest payments have been made
thereon, an amount sufficient to provide for the payment in full of any and all
interest payments on the Securities then remaining, up to and including the
sixth scheduled interest payment), the Company may direct Escrow Agent and
Trustee to release any such overfunded amount to the Company or to such other
party as the Company may direct. Upon receipt of written instructions executed
by the Company in the form of an Officers' Certificate, Trustee shall pay, or
shall cause the payment, over to the Company or the Company's designee, as the
case may be, any such overfunded amount.
4. Escrow Agent.
------------
(a) Limitation of Escrow Agent's Liability; Responsibilities of
-----------------------------------------------------------
Escrow Agent. Escrow Agent's responsibility and liability under this Agreement
------------
shall be limited as follows: (i) Escrow Agent does not represent, warrant or
guaranty to the holders of the Securities from time to time the performance of
the Company; (ii) Escrow Agent shall have no responsibility to the Company or
the holders of the Securities or Trustee from time to time as a consequence of
performance or non-performance by Escrow Agent hereunder, except for any gross
negligence or willful misconduct of Escrow Agent; (iii) the Company shall remain
solely responsible for all aspects of the Company's business and conduct; and
(iv) Escrow Agent is not obligated to supervise, inspect or inform the Company
or any third party of any matter referred to above. In no event shall Escrow
Agent be liable (A) for acting in accordance with or relying upon any
instruction, notice, demand, certificate or document from the Company or any
entity acting on behalf of the Company, (B) for any consequential, punitive or
special damages, (C) for the acts or omissions of its nominees, correspondents,
designees, subagents or subcustodians or (D) for an amount in excess of the
value of the Escrow Account, valued as of the date of deposit.
No implied covenants or obligations shall be inferred from this
Agreement against Escrow Agent, nor shall Escrow Agent be bound by the
provisions of any agreement beyond the specific terms hereof. Specifically and
without limiting the foregoing, Escrow Agent shall in no event have any
liability in connection with its investment, reinvestment or liquidation, in
good faith and in accordance with the terms hereof, of any funds or the Pledged
Securities, including without limitation any liability for any delay not
resulting from gross negligence or willful misconduct in such investment,
reinvestment or liquidation, or for any loss of principal or income incident to
any such delay.
8
Escrow Agent shall be entitled to rely upon any judicial or
administrative order or judgment, upon any opinion of counsel or upon any
certification, instruction, notice, or other writing delivered to it by the
Company or Trustee in compliance with the provisions of this Agreement without
being required to determine the authenticity or the correctness of any fact
stated therein or the propriety or validity of service thereof. Escrow Agent
may act in reliance upon any instrument comporting with the provisions of this
Agreement or signature believed by it to be genuine and may assume that any
person purporting to give notice or receipt or advice or make any statement or
execute any document in connection with the provisions hereof has been duly
authorized to do so.
At any time Escrow Agent may request in writing an instruction in
writing from the Company (other than any disbursement pursuant to Section
6(b)(iii)), and may at its own option include in such request the course of
action it proposes to take and the date on which it proposes to act, regarding
any matter arising in connection with its duties and obligations hereunder;
provided, however, that Escrow Agent shall state in such request that it
-------- -------
believes in good faith that such proposed course of action is consistent with
another identified provision of this Agreement. Escrow Agent shall not be
liable to the Company for acting without the Company's consent in accordance
with such a proposal on or after the date specified therein if (i) the specified
date is at least five Business Days after the Company receives Escrow Agent's
request for instructions and its proposed course of action, and (ii) prior to so
acting, Escrow Agent has not received the written instructions requested from
the Company.
At the expense of the Company, Escrow Agent may act pursuant to the
advice of counsel chosen by it with respect to any matter relating to this
Agreement and (subject to clause (ii) of the first paragraph of this Section
4(a)) shall not be liable for any action taken or omitted in good faith in
accordance with such advice.
Escrow Agent shall not be called upon to advise any party as to
selling or retaining, or taking or refraining from taking any action with
respect to any funds securities or other property deposited hereunder.
In the event of any ambiguity in the provisions of this Agreement with
respect to any funds, securities or property deposited hereunder, Escrow Agent
shall be entitled to refuse to comply with any and all claims, demands or
instructions with respect to such funds, securities or property, and Escrow
Agent shall not be or become liable for its failure or refusal to comply with
conflicting claims, demands or instructions. Escrow Agent shall be entitled to
refuse to act until either any conflicting or adverse claims or demands shall
have been finally determined by a court of competent jurisdiction or settled by
agreement between the conflicting claimants as evidenced in a writing,
reasonably satisfactory to Escrow Agent, or Escrow Agent shall have received
security or an indemnity satisfactory to Escrow Agent sufficient to save Escrow
Agent harmless from and against all loss, liability or expense which Escrow
Agent may incur by reason of its acting. Escrow Agent may in addition elect in
its sole option to commence an interpleader action or seek other judicial relief
or orders as Escrow Agent may deem necessary. The reasonable out-of-pocket
costs and expenses (including reasonable attorney's fees and expenses) incurred
in connection with such proceedings shall be paid by, and shall be deemed an
obligation of the Company.
9
No provision of this Agreement shall require Escrow Agent to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder.
Escrow Agent shall not incur any liability for not performing any act
or fulfilling any duty, obligation or responsibility hereunder by reason of any
occurrence beyond the control of Escrow Agent (including but not limited to any
act or provision of any present or future law or regulation or governmental
authority, any act of God or war, or the unavailability of the Federal Reserve
Bank wire or telex or other wire or communication facility).
5. Indemnity.
---------
The Company shall indemnify, hold harmless and defend Trustee and
Escrow Agent and their respective directors, officers, agents, employees and
controlling persons, from and against any and all claims, actions, obligations,
liabilities and expenses, including reasonable defense costs, reasonable
investigative fees and costs, reasonable legal fees, and claims for damages,
arising from Trustee's or Escrow Agent's performance or non-performance, or in
connection with Escrow Agent's acceptance of appointment as Escrow Agent under
this Agreement, except to the extent that such liability, expense or claim is
attributable to the gross negligence or willful misconduct of any of the
foregoing persons. To the extent that the undertaking to indemnify, pay and
hold harmless set forth in the preceding sentence may be unenforceable because
it is violative of any law or public policy, the Company shall contribute the
maximum portion which it is permitted to pay and satisfy under applicable law,
to the payment and satisfaction of all indemnified liabilities incurred by any
of the Persons to be indemnified hereunder. The provisions of this Section 5
shall survive any termination, satisfaction or discharge of this Agreement as
well as the resignation or removal of Escrow Agent.
6. Grant of Security Interest; Instructions to Escrow Agent.
--------------------------------------------------------
(a) The Company hereby irrevocably grants a first priority
security interest in and Lien on, and pledges, assigns, transfers and sets over
to Trustee for the ratable benefit of the Beneficiaries, all of the Company's
right, title and interest in the Escrow Account, and all Financial Assets,
property or other assets now or hereafter placed or deposited in or credited to,
or delivered to Escrow Agent for placement or deposit in or credit to, the
Escrow Account (whether consisting of certificated securities, uncertificated
securities, accounts, chattel paper, documents, Financial Assets, Security
Entitlements, general intangibles, instruments, deposit accounts, bank accounts,
securities accounts or other collateral accounts, money, proceeds or other items
comprising such property, whether now owned by the Company or hereafter acquired
and whether now existing or hereafter coming into existence, or other investment
property), including, without limitation, the Pledged Securities and all funds
held therein by (or otherwise maintained in the name of) Escrow Agent pursuant
to Section 2, and all proceeds thereof (including, without limitation, all
interest, dividends or other earnings, income, collections and distributions
from or in respect of, or from or in respect of investments or reinvestments of
the Escrow Collateral), whether now existing or hereafter arising or acquired,
as well as all rights of the Company under this Agreement (collectively, the
"Escrow Collateral"), in order to secure all obligations and indebtedness of the
-----------------
Company under the Indenture, the
10
Securities and any other obligation, now or hereafter arising, of every kind and
nature, owed by the Company under the Indenture or the Securities to the Holders
of the Securities or to Trustee or any predecessor Trustee (the "Secured
-------
Obligations"). Escrow Agent hereby acknowledges Trustee's security interest and
-----------
Lien as set forth above. The Company shall take all actions necessary on its
part to insure the continuance of a first priority security interest in the
Escrow Collateral in favor of Trustee in order to secure all the Secured
Obligations.
(b) The Company and Trustee hereby irrevocably instruct Escrow Agent
to, and Escrow Agent shall:
(i) (A) maintain the Escrow Account for the sole dominion
and control of the Trustee in the name of and on behalf of the Beneficiaries
over the Pledged Securities and funds in the Escrow Account for the benefit of
Trustee to the extent specifically required herein, (B) maintain, or cause its
agent within the State of California to maintain, possession of all Government
Securities pledged hereunder that are physically possessed by Escrow Agent in
order for Trustee to enjoy a continuous perfected first priority security
interest therein under the law of the State of California, (C) maintain the
Escrow Collateral free and clear of all Liens, security interests, safekeeping
or other charges, demands and claims against Escrow Agent of any nature now or
hereafter existing in favor of anyone other than Trustee, (D) be and remain a
Securities Intermediary and act as such with respect to the Escrow Account, the
Escrow Collateral and the Trustee, which is the Entitlement Holder and has (and
which the Escrow Agent shall treat as the Person with) sole dominion and control
(including, without limitation, Security Control) over the Escrow Account and
the Escrow Collateral, (E) maintain and continue to maintain, on behalf of its
customers, (I) at least one customer Securities Account with (or at least one
Securities Intermediary that maintains, on behalf of its customers, customer
Securities Accounts with) the Depository Trust Company and (II) a Securities
Account with at least one Person that is and will be eligible to have, and in
fact has and will continue to have, a Fed Member Securities Account for its
customers, (F) as Securities Intermediary, credit to the Escrow Account any and
all assets and properties required to be transferred, placed, delivered or
created therein or thereto, and (G) maintain the Escrow Account and the Escrow
Collateral in the State of California;
(ii) promptly notify Trustee and the Company if Escrow Agent
receives written notice that any Person other than Escrow Agent has a Lien or
upon any portion of the Escrow Collateral; and
(iii) in addition to disbursing amounts held in escrow
pursuant to any Payment Notice and Disbursement Request given to it pursuant to
Section 3, upon receipt of written notice from Trustee of the acceleration of
the maturity of the Securities in accordance with the Indenture, and direction
from Trustee to disburse all Available Funds to Trustee, as promptly as
practicable, disburse all funds held in the Escrow Account to Trustee and
transfer title to all Government Securities held by Escrow Agent hereunder to
Trustee and notify the Company of such disbursement. In addition, upon an Event
of Default and for so long as such Event of Default continues, Trustee may, and
Escrow Agent shall on behalf of Trustee when instructed by Trustee, exercise in
respect of the Escrow Collateral, in addition to other rights and remedies
provided for herein or otherwise available to it, all the rights and remedies of
a secured party under the Revised UCC or other applicable law, and Trustee may,
and Escrow Agent shall
11
on behalf of Trustee when instructed by Trustee, also upon obtaining possession
of the Escrow Collateral as set forth herein, without notice to the Company
except as specified below, sell the Escrow Collateral or any part thereof in one
or more parcels at public or private sale, at any exchange, broker's board or at
any of Trustee's offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as Trustee may deem commercially reasonable.
The Company acknowledges and agrees that any such private sale may result in
prices and other terms less favorable to the seller than if such sale were a
public sale. The Company agrees that, to the extent notice of sale shall be
required by law, at least ten (10) days' notice to the Company of the time and
place of any public sale or the time after which any private sale is to be made
shall constitute commercially reasonable notification. Trustee shall not be
obligated to make any sale regardless of notice of sale having been given.
Trustee may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further notice,
be made at the time and place to which it was so adjourned. At any time during
which this Agreement shall not have been terminated in accordance with its
terms, any Beneficiary or any of their respective affiliates may be the
purchaser of any or all of the Escrow Collateral at any such sale and shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Escrow Collateral sold at such
sale, to use and apply any of the Secured Obligations owed to such Person as a
credit on account of the purchase price of any Escrow Collateral payable by such
Person at such sale. Each purchaser at any such sale shall acquire the property
sold absolutely free from any claim or right on the part of the Company, and the
Company hereby waives, to the fullest extent permitted by law, all rights of
redemption, stay and/or appraisal which it now has or may at any time in the
future have under any rule of law or statute now existing or hereafter enacted.
Escrow Agent shall not be obligated to make any sale of Escrow Collateral
regardless of notice of sale having been given. Escrow Agent may adjourn any
public or private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at the time
and place to which it was so adjourned. The Company hereby waives, to the
fullest extent permitted by law, any claims against Escrow Agent arising by
reason of the fact that the price at which any Escrow Collateral may have been
sold at such a private sale was less than the price which might have been
obtained at a public sale, even if Escrow Agent accepts the first offer received
and does not offer such Escrow Collateral to more than one offeree.
The Lien provided for by this Section 6 shall automatically terminate
and cease as to, and shall not extend or apply to, and Trustee and Escrow Agent
shall have no security interest in, any funds disbursed by Escrow Agent whether
for payment of interest or to the Company pursuant to this Agreement to the
extent not inconsistent with the terms hereof. Notwithstanding any other
provision contained in this Agreement, Escrow Agent shall act solely as
Trustee's agent in connection with its duties under this Section 6 or any other
duties herein relating to the Escrow Account or the Pledged Securities or any
funds held thereunder. Escrow Agent shall not have any right to receive
compensation from Trustee and shall have no authority to obligate Trustee or to
compromise or pledge its security interest hereunder. Accordingly, Escrow Agent
is hereby directed to cooperate with Trustee in the exercise of its rights in
the Escrow Collateral provided for herein.
(c) Any money collected by Trustee pursuant to Section 6(b)(iii) shall
be applied as provided in Article 11 of the Indenture. Any surplus of such cash
or cash proceeds held by Trustee and remaining after payment in full of all the
obligations under the Indenture
12
(the "Escrow Funds") shall be paid over to the Company upon the Company request
------------
or as a court of competent jurisdiction may direct.
(d) The Company hereby waives, to the fullest extent permitted by
applicable law, notice or judicial hearing in connection with Escrow Agent's
taking possession or Escrow Agent's disposition of any of the Escrow Collateral,
including, without limitation, any and all prior notice and hearing for any
prejudgment remedy or remedies and any such right which the Company would
otherwise have under law, and the Company hereby further waives, to the full
extent permitted by applicable law: (i) all damages occasioned by such taking
of possession; (ii) all other requirements as to the time, place and terms of
sale or other requirements with respect to the enforcement of Escrow Agent's
rights hereunder; and (iii) all rights of redemption, appraisal, valuation,
stay, extension or moratorium now or hereafter in force under any applicable
law. To the fullest extent permitted by law, any sale of, or the grant of
options to purchase, or any other realization upon, any Escrow Collateral shall
operate to divest all right, title, interest, claim and demand, either at law or
in equity, of the Company therein and thereto, and shall be a perpetual bar both
at law and in equity against the Company and against any and all Persons
claiming or attempting to claim the Escrow Collateral so sold, optioned or
realized upon, or any part thereof, from, through or under the Company.
(e) Notwithstanding any other provision of this Agreement to the
contrary, if, after giving effect to any sale, transfer or other disposition of
any or all of the Escrow Collateral pursuant hereto and after the application of
the proceeds hereunder, any Secured Obligations remain unpaid or unsatisfied,
the Company shall remain liable for the unpaid and unsatisfied amount of such
Secured Obligations for which the Company is otherwise liable pursuant to the
Indenture or otherwise.
(f) The Company will execute and deliver or cause to be executed and
delivered, or use its best efforts to procure, all stock powers, proxies,
assignments, instruments and other documents, deliver any instruments to Trustee
and take any other actions that are necessary or desirable to perfect, continue
the perfection of, or protect the first priority of Trustee's Lien in and to the
Escrow Collateral, to protect the Escrow Collateral against the rights, claims,
or interests of third Persons or to effect the purposes of this Agreement. The
Company also hereby authorizes Trustee to file any financing or continuation
statements with respect to the Escrow Collateral without the signature of the
Company (to the extent permitted by applicable law). The Company will pay all
reasonable costs incurred in connection with any of the foregoing. It is
understood that Trustee has no duty to determine whether to file or record any
document or instrument relating to Escrow Collateral.
(g) The Company hereby appoints Trustee as its attorney-in-fact with
full power of substitution to do any act which the Company is obligated hereto
to do, and Trustee may, but shall not be obligated to, exercise such rights as
the Company might exercise with respect to the Escrow Collateral and take any
action in the Company's name to protect Trustee's security interest hereunder.
7. Termination. This Agreement and the security interest in the
-----------
Escrow Collateral evidenced by this Agreement and the Power of Attorney
described in Section 10 shall terminate automatically and be of no further force
or effect upon the payment in full in cash of
13
all interest (including any Additional Amounts) due through the Interest Payment
Date occurring on June 1, 2001 and the Escrow Collateral shall promptly be paid
over and transferred to the Company; provided, however, that the obligations of
-------- -------
the Company under Section 2(c) and Section 5 (and any existing claims
thereunder) shall survive termination of this Agreement and the resignation of
Escrow Agent. At such time, Escrow Agent shall, pursuant to a certificate of an
officer of the Company, reassign and redeliver to the Company all of the Escrow
Collateral hereunder that has not been sold, disposed of, retained or applied by
Escrow Agent in accordance with the terms of this Agreement and the Indenture.
Such reassignment and delivery shall be without warranty by or recourse to
Escrow Agent in its capacity as such, except as to the absence of any liens on
the Escrow Collateral created by or arising through Escrow Agent, and shall be
at the sole expense of the Company.
8. Representations and Warranties.
------------------------------
The Company hereby represents and warrants to the Escrow Agent and the
Trustee that:
(a) The execution, delivery and performance by the Company of
this Agreement are within the Company's corporate powers, have been duly
authorized by all necessary corporate action, and do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
the Certificates of Incorporation of the Company or of any agreement, judgment,
injunction, order, decree or other instrument binding upon the Company or result
in the creation or imposition of any Lien on any assets of the Company, except
for the security interests granted under this Agreement.
(b) The Company is the beneficial owner of the Escrow
Collateral, free and clear of any Lien or claims of any Person (except for the
Lien granted under this Agreement). No financing statement covering the Escrow
Collateral is on file in any public office other than the financing statements,
if any, filed pursuant to this Agreement.
(c) This Agreement has been duly executed and delivered by the
Company and assuming the due authorization and valid execution and delivery of
this Agreement by Trustee and Escrow Agent and enforceability of this Agreement
against Escrow Agent and Trustee in accordance with its terms, constitutes a
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (i)
the effect of any applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights generally, (ii) general
principles of equity and commercial reasonableness, (iii) with respect to the
exculpation provisions and rights to indemnification hereunder, U.S. federal and
state securities laws and public policy considerations and (iv) the waiver of
rights and defenses contained in Sections 15(j) and 15(o).
(d) Upon the delivery to Escrow Agent of the certificates or
instruments, if any, representing the Escrow Collateral and the filing of
financing statements, if any, required by the Revised UCC, and the transfer and
pledge to Escrow Agent of the Escrow Collateral, the acquisition by Escrow Agent
of a Security Entitlement thereto in accordance with Section 6 and continuous
possession of the Escrow Collateral by the Escrow Agent, the pledge of
14
the Escrow Collateral pursuant to this Agreement creates a valid and perfected
first priority Lien in and to the Escrow Collateral, securing the payment of the
Secured Obligations for the benefit of the Beneficiaries, enforceable as such
against all creditors of the Company and any Persons purporting to purchase any
of the Escrow Collateral from the Company other than as permitted by the
Indenture.
(e) No consent of any other Person and no consent, authorization,
approval, or other action by, and no notice to or filing with, any governmental
authority or regulatory body is required either (i) for the pledge by the
Company of the Escrow Collateral pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by the Company (except for
any filings necessary to perfect Liens on the Escrow Collateral) or (ii) for the
exercise by Trustee of the rights provided for in this Agreement or the remedies
in respect of the Escrow Collateral pursuant to this Agreement, except, in each
case, as may be required in connection with such disposition by laws affecting
the offering and sale of securities.
(f) No litigation, investigation or proceeding of or before any
arbitrator or governmental authority is pending or, to the knowledge of the
Company, threatened by or against the Company with respect to this Agreement or
any of the transactions contemplated hereby.
(g) The pledge of the Escrow Collateral pursuant to this Agreement is
not prohibited by any applicable law or governmental regulation, release,
interpretation or opinion of the Board of Governors of the Federal Reserve
System or other regulatory agency (including, without limitation, Regulations T,
U and X of the Board of Governors of the Federal Reserve System).
(h) The scheduled payments of principal and interest on the Pledged
Securities will be sufficient to provide for the payment in full of the interest
due on the Securities on the first three scheduled Interest Payment Dates
commencing June 1, 2000 and ending June 1, 2001.
9. Covenants.
---------
The Company covenants and agrees with the Beneficiaries from and after
the date of this Agreement until the earlier of payment in full in cash of (A)
all interest due through the Interest Payment Date occurring on June 1, 2001 or
(B) all obligations due and owing under the Indenture and the Securities in the
event such obligations become due and payable prior to the payment of the first
three scheduled interest payments on the Securities:
(a) The Company agrees that it will not (i) sell or otherwise
dispose of, or grant any option or warrant with respect to, any of the Escrow
Collateral or (ii) create or permit to exist any Lien upon or with respect to
any of the Escrow Collateral (except for the Lien created pursuant to this
Agreement) and at all times will be the sole beneficial owner of the Escrow
Collateral.
(b) The Company agrees that it will not (i) enter into any
agreement or understanding that purports to or may restrict or inhibit Trustee's
rights or remedies hereunder, including, without limitation, Trustee's right to
sell or otherwise dispose of the Escrow Collateral
15
or (ii) fail to pay or discharge any tax, assessment or levy of any nature not
later than five days prior to the date of any proposed sale under any judgment,
writ or warrant of attachment with regard to the Escrow Collateral.
10. Power of Attorney.
-----------------
In addition to all of the powers granted to Trustee pursuant to
Article 7 of the Indenture, the Company hereby appoints and constitutes Trustee
as the Company's attorney-in-fact to exercise to the fullest extent permitted by
law all of the following powers upon and at any time after the occurrence and
during the continuance of an Event of Default: (i) collection of proceeds of
any Escrow Collateral; (ii) conveyance of any item of Escrow Collateral to any
purchaser thereof; (iii) giving of any notices or recording of any Liens under
Section 6; (iv) making of any payments or taking any acts under Section 11; and
(v) paying or discharging taxes or Liens levied or placed upon the Escrow
Collateral, the legality or validity thereof and the amounts necessary to
discharge the same to be determined by Trustee in its sole discretion, and such
payments made by Trustee to become the obligations of the Company to Trustee,
due and payable immediately upon demand. Trustee's authority hereunder shall
include, without limitation, the authority to endorse and negotiate any checks
or instruments representing proceeds of Escrow Collateral in the name of the
Company, execute and give receipt for any certificate of ownership or any
document constituting Escrow Collateral, transfer title to any item of Escrow
Collateral, sign the Company's name on all financing statements (to the extent
permitted by applicable law) or any other documents deemed necessary or
appropriate by Trustee to preserve, protect or perfect this security interest in
the Escrow Collateral and to file the same, prepare, file and sign the Company's
name on any notice of Lien, to take any other actions arising from or incident
to the powers granted to Trustee in this Agreement; provided that this Section
--------
10 does not create any obligation on the part of the Trustee to perform any of
the acts authorized hereby. This power of attorney is coupled with an interest
and is irrevocable by the Company.
11. Trustee May Perform.
-------------------
If the Company fails to perform any agreement required to be performed
by it herein, Trustee may itself perform, but shall not be obligated to perform,
or cause performance of, such agreement, and the reasonable expenses of Trustee
incurred in connection therewith shall be payable by the Company under Section
13 hereof.
12. No Assumption of Duties; Reasonable Care.
----------------------------------------
The rights and powers granted to Trustee hereunder are being granted
in order to preserve and protect Trustee's and the Holders' of Securities Lien
in and to the Escrow Collateral granted hereby and shall not be interpreted to,
and shall not, impose any duties on Trustee in connection therewith other than
those imposed under applicable law. Except as provided by applicable law or by
the Indenture, Trustee shall be deemed to have exercised reasonable care in the
custody and preservation of the Escrow Collateral in its possession if the
Escrow Collateral is accorded treatment substantially equal to that which
Trustee accords similar property in similar situations, it being understood that
Trustee shall not have any responsibility for (i) ascertaining or taking action
with respect to calls, conversions, exchanges, maturities,
16
tenders or other matters relative to any Escrow Collateral, whether or not
Trustee has or is deemed to have knowledge of such matters or (ii) taking any
necessary steps to preserve rights against any parties with respect to any
Escrow Collateral; provided, however, that nothing contained in this Agreement
-------- -------
shall relieve Trustee of any responsibilities as a Securities Intermediary under
applicable law.
13. Expenses.
--------
The Company will upon demand pay to Trustee the amount of all
reasonable out-of-pocket expenses, including, without limitation, the reasonable
fees, expenses and disbursements of its counsel, experts and agents retained by
Trustee that Trustee may actually incur in connection with (i) the
administration of this Agreement, (ii) the custody or preservation of, or the
sale of, collection from, or other realization upon, any of the Escrow
Collateral, (iii) the exercise or enforcement of any of the rights of the
Beneficiaries hereunder, or (iv) the failure by the Company to perform or
observe any of the provisions hereof.
14. Security Interest Absolute.
--------------------------
All rights of the Beneficiaries and security interests hereunder, and
all obligations of the Company hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of the Indenture or
any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Secured Obligations, or any other amendment
or waiver of or any consent to any departure from the Indenture;
(c) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or similar event of the Company or any of
its Subsidiaries;
(d) any exercise or non-exercise, or any waiver of any right,
remedy, power or privilege under or in respect of this Agreement or the
Indenture except as specifically set forth in a waiver granted pursuant to the
provisions of Section 15(a) hereof;
(e) any exchange, surrender, release or non-perfection of any
Liens on any other Escrow Collateral for all or any of the Secured Obligations;
or
(f) to the extent permitted by applicable law, any other
circumstance which might otherwise constitute a defense available to, or a
discharge of, the Company in respect of the Secured Obligations or of this
Agreement.
15. Miscellaneous.
-------------
(a) Waiver. Any party hereto may specifically waive any breach
------
of this Agreement by any other party, but no such waiver shall be deemed to have
been given unless
17
such waiver is in writing, signed by the waiving party and specifically
designating the breach waived, nor shall any such waiver constitute a continuing
waiver of similar or other breaches.
(b) Invalidity. If for any reason whatsoever any one or more of
----------
the provisions of this Agreement shall be held or deemed to be inoperative,
unenforceable or invalid in a particular case or in all cases, such
circumstances shall not have the effect of rendering any of the other provisions
of this Agreement inoperative, unenforceable or invalid, and the inoperative,
unenforceable or invalid provision shall be construed as if it were written so
as to effectuate, to the maximum extent possible, the parties' intent.
(c) Assignment. This Agreement is personal to the parties
----------
hereto, and the rights and duties of any party hereunder shall not be assignable
except with the prior written consent of the other parties. Notwithstanding the
foregoing, this Agreement shall inure to and be binding upon the parties and
their successors and permitted assigns.
(d) Benefit. The parties hereto and their successors and
-------
permitted assigns, but no others, shall be bound hereby and entitled to the
benefits hereof; provided, however, that the Beneficiaries (including holders of
-------- -------
the Securities) and their assigns shall be entitled to the benefits hereof and
to enforce this Agreement.
(e) Time. Time is of the essence with respect to each
----
provision of this Agreement.
(f) Entire Agreement; Amendments. This Agreement and the
----------------------------
Indenture contain the entire agreement among the parties with respect to the
subject matter hereof and supersede any and all prior agreements, understandings
and commitments, whether oral or written. Any amendment or waiver of any
provision of this Agreement and any consent to any departure by the Company from
any provision of this Agreement shall be effective only if made or duly given in
compliance with all of the terms and provisions of the Indenture, and none of
the Company, Escrow Agent, Trustee or any Holder of Securities shall be deemed,
by any act, delay, indulgence, omission or otherwise, to have waived any right
or remedy hereunder or to have acquiesced in any Default or Event of Default or
in any breach of any of the terms and conditions hereof. Failure of the Company,
Escrow Agent, Trustee or any Holder of Securities to exercise, or delay in
exercising, any right, power or privilege hereunder shall not operate as a
waiver thereof. No single or partial exercise of any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of
any right, power or privilege hereunder shall preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. A
waiver by the Company, Escrow Agent, Trustee or any Holder of Securities of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy that the Company, Escrow Agent, Trustee or such Holder of
Securities would otherwise have on any future occasion. The rights and remedies
herein provided are cumulative, may be exercised singly or concurrently and are
not exclusive of any rights or remedies provided by law.
(g) Notices. All notices and other communications required or
-------
permitted to be given or made under this Agreement shall be in writing and shall
be deemed to have been duly given and received when actually received,
including: (a) on the day of hand
18
delivery; (b) three Business Days following the day sent, when sent by United
States certified mail, postage and certification fee prepaid, return receipt
requested, addressed as set forth below; (c) when transmitted by telecopy with
verbal confirmation of receipt by the telecopy operator to the telecopy number
set forth below; or (d) one Business Day following the day timely delivered to a
next-day air courier addressed as set forth below:
To Escrow Agent:
State Street Bank and Trust Company
of California, N.A.
000 Xxxx 0xx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Corporate Trust Administration (Equinix, Inc. 1999 Escrow)
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
To Trustee:
State Street Bank and Trust Company
of California, N.A.
000 Xxxx 0xx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Corporate Trust Administration (Equinix, Inc. 1999 Escrow)
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
To the Company:
Equinix, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxx, XX 00000
Attention: Chief Executive Officer
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
With a copy to:
Xxxxxxxxx Xxxxxxx Xxxxxx Xxxxxxxxxx
Xxxxxxxx & Xxxxxxxxx, LLP
000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
or at such other address as the specified entity most recently may have
designated in writing in accordance with this Section.
Notwithstanding the foregoing, any notice addressed to the Escrow
Agent or the Trustee shall be effective only when an officer in its corporate
trust administration department
19
has received it. If any notice or other document is required to be delivered to
Escrow Agent or the Trustee and any other person, the Escrow Agent or Trustee
may assume that such notice or other document was received on the date on which
it was received by the Escrow Agent or the Trustee, but the Escrow Agent or the
Trustee need not inquire into or verify such receipt.
(h) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
(i) Captions. Captions in this Agreement are for convenience only
--------
and shall not be considered or referred to in resolving questions of
interpretation of this Agreement.
(j) GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
----------------------------------------------------------------
WAIVER OF DAMAGES.
-----------------
(i) THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, THE
CREATION, PERFECTION, EFFECTS OF PERFECTION AND PRIORITY OF THE LIENS AND
SECURITY INTERESTS GRANTED HEREIN) SHALL BE GOVERNED BY AND INTERPRETED UNDER
THE LAWS OF THE STATE OF CALIFORNIA, AND ANY DISPUTE ARISING OUT OF, CONNECTED
WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THE
COMPANY, ESCROW AGENT, TRUSTEE AND THE HOLDERS OF SECURITIES IN CONNECTION WITH
THIS AGREEMENT, AND WHETHER ARISING IN CONTRACT, TORT, EQUITY OR OTHERWISE,
SHALL BE RESOLVED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA,
EXCLUDING (TO THE GREATEST EXTENT PERMITTED BY LAW) ANY RULE OF LAW THAT WOULD
CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF
CALIFORNIA. THE "SECURITIES INTERMEDIARY'S JURISDICTION" OF THE ESCROW AGENT IS
AND WILL CONTINUE TO BE THE STATE OF CALIFORNIA.
(ii) THE COMPANY AGREES THAT TRUSTEE SHALL, IN ITS CAPACITY AS
TRUSTEE OR IN THE NAME AND ON BEHALF OF ANY HOLDER OF SECURITIES, HAVE THE
RIGHT, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TO PROCEED AGAINST THE COMPANY
OR ITS PROPERTY IN A COURT IN ANY LOCATION REASONABLY SELECTED IN GOOD FAITH
(AND HAVING PERSONAL OR IN REM JURISIDICTION OVER THE COMPANY OR ITS PROPERTY,
AS THE CASE MAY BE) TO ENABLE TRUSTEE TO REALIZE ON SUCH PROPERTY, OR TO ENFORCE
A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR OF TRUSTEE. THE COMPANY AGREES
THAT IT WILL NOT ASSERT ANY COUNTERCLAIMS, SETOFFS OR CROSSCLAIMS IN ANY
PROCEEDING BROUGHT BY TRUSTEE TO REALIZE ON SUCH PROPERTY OR TO ENFORCE A
JUDGMENT OR OTHER COURT ORDER IN FAVOR OF TRUSTEE, EXCEPT FOR SUCH
COUNTERCLAIMS, SETOFFS OR CROSSCLAIMS WHICH, IF NOT ASSERTED IN ANY SUCH
PROCEEDING, COULD NOT OTHERWISE BE BROUGHT OR ASSERTED. THE COMPANY WAIVES ANY
OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT IN WHICH TRUSTEE HAS
COMMENCED A PROCEEDING DESCRIBED IN
20
THIS PARAGRAPH INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS.
(iii) THE COMPANY, ESCROW AGENT AND TRUSTEE EACH WAIVE ANY RIGHT
TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT, OR OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
AGREEMENT. INSTEAD, ANY DISPUTES RESOLVED IN COURT WILL BE RESOLVED IN A BENCH
TRIAL WITHOUT A JURY.
(iv) THE COMPANY AGREES THAT NONE OF ESCROW AGENT, TRUSTEE OR
ANY HOLDER OF SECURITIES SHALL HAVE ANY LIABILITY TO THE COMPANY (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) FOR LOSSES SUFFERED BY THE COMPANY IN
CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED TO, THE TRANSACTIONS
CONTEMPLATED AND THE RELATIONSHIP ESTABLISHED BY THIS AGREEMENT, OR ANY ACT,
OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH, UNLESS IT IS DETERMINED BY
A FINAL AND NONAPPEALABLE JUDGMENT OF A COURT THAT IS BINDING ON ESCROW AGENT,
TRUSTEE OR SUCH HOLDER OF SECURITIES, AS THE CASE MAY BE, THAT SUCH LOSSES WERE
THE RESULT OF ACTS OR OMISSIONS ON THE PART OF ESCROW AGENT, TRUSTEE OR SUCH
HOLDER OF SECURITIES, AS THE CASE MAY BE, CONSTITUTING GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT.
(v) TO THE EXTENT PERMITTED BY APPLICABLE LAW, AND EXCEPT AS
OTHERWISE PROVIDED IN THIS AGREEMENT, THE COMPANY WAIVES ALL RIGHTS OF NOTICE
AND HEARING OF ANY KIND PRIOR TO THE EXERCISE BY THE TRUSTEE OR ANY HOLDER OF
SECURITIES OF ITS RIGHTS DURING THE CONTINUANCE OF AN EVENT OF DEFAULT TO
REPOSSESS THE ESCROW COLLATERAL WITH JUDICIAL PROCESS OR TO REPLEVY, ATTACH OR
LEVY UPON THE ESCROW COLLATERAL OR OTHER SECURITY FOR THE SECURED OBLIGATIONS.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE COMPANY WAIVES THE POSTING OF ANY
BOND OTHERWISE REQUIRED OF ESCROW AGENT, TRUSTEE OR ANY HOLDER OF SECURITIES IN
CONNECTION WITH ANY JUDICIAL PROCESS OR PROCEEDING TO OBTAIN POSSESSION OF,
REPLEVY, ATTACH OR LEVY UPON THE ESCROW COLLATERAL OR OTHER SECURITY FOR THE
SECURED OBLIGATIONS, TO ENFORCE ANY JUDGMENT OR OTHER COURT ORDER ENTERED IN
FAVOR OF ESCROW AGENT, TRUSTEE OR ANY HOLDER OF SECURITIES, OR TO ENFORCE BY
SPECIFIC PERFORMANCE, TEMPORARY RESTRAINING ORDER OR PRELIMINARY OR PERMANENT
INJUNCTION, THIS AGREEMENT OR ANY OTHER AGREEMENT OR DOCUMENT BETWEEN THE
COMPANY ON THE ONE HAND AND ESCROW AGENT, TRUSTEE AND/OR THE HOLDERS OF
SECURITIES ON THE OTHER HAND.
(k) No Adverse Interpretation of Other Agreements. This Agreement
---------------------------------------------
may not be used to interpret another pledge, security or debt agreement of the
Company or any
21
Subsidiary thereof. No such pledge, security or debt agreement may be used to
interpret this Agreement.
(l) Benefits of Agreement. Nothing in this Agreement, express or
---------------------
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, and the Holders of Securities (in accordance with the
terms of the Indenture), any benefit or any legal or equitable right, remedy or
claim under this Agreement.
(m) Interpretation of Agreement. All terms not defined herein or
---------------------------
in the Indenture shall have the meaning set forth in the Revised UCC, except
where the context otherwise requires. To the extent a term or provision of this
Agreement conflicts with the Indenture, the Indenture shall control with respect
to the subject matter of such term or provision. Acceptance of or acquiescence
in a course of performance rendered under this Agreement shall not be relevant
to determine the meaning of this Agreement even though the accepting or
acquiescing party had knowledge of the nature of the performance and opportunity
for objection.
(n) Survival of Provisions. All representations, warranties and
----------------------
covenants of the Company contained herein shall survive the execution and
delivery of this Agreement, and shall terminate only upon the termination of
this Agreement.
(o) Waivers. The Company waives presentment and demand for
-------
payment of any of the Secured Obligations, protest and notice of dishonor or
default with respect to any of the Secured Obligations, and all other notices to
which the Company might otherwise be entitled, except as otherwise expressly
provided herein or in the Indenture.
[Signature Page Follows]
22
IN WITNESS WHEREOF, the parties have executed and delivered this
Escrow Agreement as of the day first above written.
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., as
Escrow Agent and Securities Intermediary
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., as
Trustee
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
EQUINIX, INC.
By: /s/ Xxx X. Xxxxxxx
---------------------------------------
Name: Xxx X. Xxxxxxx
Title: Secretary
EXHIBIT A
---------
Form of Payment Notice and Disbursement Request
[Letterhead of Equinix, Inc.]
[Date]
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., as Escrow Agent
000 Xxxx 0xx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Corporate Trust Administration (Equinix, Inc. 1999 Escrow)
Re: Disbursement Request No. ____
[indicate whether revised]
Ladies and Gentlemen:
We refer to the Escrow Agreement, dated as of December 1, 1999 (the
"Escrow Agreement") among you (the "Escrow Agent"), State Street Bank and Trust
Company of California, N.A., as Trustee, and Equinix, Inc., a Delaware
corporation (the "Company"). Capitalized terms used herein shall have the
meaning given in the Escrow Agreement.
This letter constitutes a Payment Notice and Disbursement Request
under the Escrow Agreement.
[choose one of the following, as applicable]
[The undersigned hereby notifies you that a scheduled interest payment
in the amount of $__________ is due and payable on ____________, ____ and
requests a disbursement of funds contained in the Escrow Account in such amount
to Trustee.]
[The undersigned hereby notifies you and certifies to you that the
release of $________ funds in the Escrow Account to the Company (to an account
designated by the Company in writing), is currently permitted to be released in
accordance with Section 3(c) of the Escrow Agreement and such amount shall be so
remitted to the Company.]
[The undersigned hereby notifies you that the Escrow Agreement has
been terminated in accordance with Section 7 thereof and requests that you
release the Escrow Account to the Company.]
[The undersigned hereby notifies you that there has been an
acceleration of the maturity of the Securities under the Indenture.
Accordingly, you are hereby requested to
disburse all remaining funds contained in the Escrow Account to Trustee such
that the balance in the Escrow Account is reduced to zero.]
In connection with the requested disbursement, the undersigned hereby
notifies you that:
(i) [The Securities have not, as a result of an Event of Default
(as defined in the Indenture), been accelerated and become due and
payable.]
(ii) All prior disbursements from the Escrow Account have been
Applied.
(iii) [add wire instructions]
Escrow Agent is entitled to rely on the foregoing in disbursing funds
relating to this Payment Notice and Disbursement Request.
EQUINIX, INC.
By: _________________________________
Name:________________________________
Title:_______________________________
Schedule A
----------
Transaction Summary:
Trade Date: 11/30/99
Settlement Date: 00/0/00
Xxxxx Xxxxxx Bank (Escrow Agent) purchased the Treasury Strips noted below on
behalf of The Company as specified in the Escrow Agreement between the Escrow
Agent and The Company
Coupon Collateral
Face Amount Payment Date Maturity Cost CUSIP
=============================================================================
1 $13,000,000 1-Jun-00 15-May-00 $12,699,440.00 000000XX0
2 $13,000,000 1-Dec-00 15-Nov-00 $12,342,850.00 000000XX0
3 $13,000,000 1-Jun-01 15-May-01 $11,969,230.00 000000XX0
=============================================================================
$39,000,000 $37,011,520.00
