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EXHIBIT 10.8
ESCROW AGREEMENT [$11.6 MILLION]
This Escrow Agreement [$11.6 Million] (this "Agreement"), dated as of
this 6th day of October, 1995, is made by and among XXXXXX X. XXXX ("RSH"),
DART GROUP CORPORATION, a Delaware corporation ("Dart"), and Settlementcorp.
(the "Escrow Agent").
WHEREAS, Dart and RSH are adverse parties in the lawsuits captioned,
Xxxxxx X. Xxxx v. Dart Group Corporation, Delaware Xxxxxxxx Xxxxx, XX-00000 and
Xxxx X. Xxxx and the Tudor Trust v. Xxxxxxx Xxxx, Del. Ch. C.A. No. 13154 and,
simultaneously with the execution and delivery of this Agreement, have entered
into that certain Settlement Agreement, of even date herewith, pursuant to
which Dart and RSH have agreed to settle such lawsuits on the terms, and
subject to the conditions, set forth therein (the "Settlement Agreement");
WHEREAS, on the date hereof, Dart has loaned to RSH $11,619,274.00 and
deposited such amount with the Escrow Agent (the "Escrow Funds"), and RSH has
executed a promissory note in favor of Dart for the Escrow Funds (the "$11.6
Million Note") and delivered such promissory note to the Escrow Agent;
WHEREAS, RSH is borrowing the Escrow Funds in order to pay off in full
the principal sum and accrued interest owed by RSH under that certain
Promissory Note, dated July 28, 1993 (the "HHH Note"), executed by RSH in favor
of Xxxxxxx X. Xxxx ("HHH");
WHEREAS, pursuant to the Settlement Agreement, RSH and Dart have
agreed that RSH shall, on the date hereof, tender prepayment in full of the HHH
Note and that the Escrow Agent shall act on behalf of RSH in effecting such
prepayment in accordance with the terms of this Agreement; and
WHEREAS, RSH and Dart desire to appoint the Escrow Agent as the escrow
agent under this Agreement upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, the parties do hereby agree as follows:
1. APPOINTMENT OF ESCROW AGENT; RECEIPT OF ESCROW FUNDS
(a) RSH and Dart hereby appoint the Escrow Agent to act
as escrow agent on the terms and conditions hereinafter set forth, and the
Escrow Agent accepts such appointment.
(b) The Escrow Agent hereby acknowledges receipt of the
Escrow Funds and the $11.6 Million Note and agrees to hold
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and dispose of the Escrow Funds and the $11.6 Million Note pursuant to the
terms and conditions of this Agreement.
2. DUTIES OF ESCROW AGENT
(a) The Escrow Agent's duties and responsibilities, shall
be limited to those expressly set forth in this Agreement and the Escrow Agent
shall not be subject to, nor obliged to recognize, any other agreement covering
the subject matter hereof.
(b) The Escrow Agent shall make the Escrow Funds
available for pick-up by HHH as provided in Section 5(a) hereof, and agrees, in
connection therewith, to maintain authorized personnel at its offices located
at 0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000, and have the
Escrow Funds in the form of a cashier's check readily available for pick-up by
HHH on October 6, 1995 until 9:00 p.m., on October 7, 1995 from 10:00 a.m.
until 3:00 p.m., on October 9, 1995 from 10:00 a.m. until 3:00 p.m., and
October 10, 1995 from 10:00 a.m. until 3:00 p.m. Any time after October 10,
1995, the Escrow Agent shall make the Escrow Funds available for pick-up by HHH
as provided in Section 5(a) hereof within one business day upon receipt of
written notification by HHH of his intent to pick-up the Escrow Funds.
(c) The Escrow Agent is authorized, in its sole
discretion, to disregard any and all notices, claims, instructions, demands or
directions (individually and collectively, "Directions") given by RSH or Dart,
or by any other Person, except (i) such Directions as are specifically provided
for herein, and (ii) a Final Order (as defined below) of a court of law. If
the delivery of any document subject hereto is at any time stayed or enjoined
by order of a court, or in case the Final Order of a court shall be made or
entered affecting any such document, then and in any of such events, the Escrow
Agent is authorized, in its sole discretion, to rely upon and comply with any
such order, writ, judgment or decree of any court which the Escrow Agent
determines is not subject to further review or appeal and is binding upon the
Escrow Agent (a "Final Order"). In reaching such determination, the Escrow
Agent, in its sole discretion, may obtain the advice of counsel of its own
choosing (which may be counsel for Dart).
(d) If the Escrow Agent believes it to be reasonably
necessary to consult with counsel concerning any of its duties in connection
with this Agreement, or in case the Escrow Agent becomes involved in litigation
on account of being Escrow Agent hereunder or on account of having received
property subject hereto, then, in either case, the attorneys' and accountants'
fees incurred by the Escrow Agent (including the fair value of legal services
rendered by the Escrow Agent), if any, shall be borne by RSH.
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3. LIABILITY AND RELIANCE
(a) The Escrow Agent shall not, be personally liable for
any act taken or omitted hereunder absent gross negligence or willful
misconduct on its part.
(b) The Escrow Agent shall not be responsible for the
sufficiency, form, accuracy, execution, validity or genuineness of any
Direction or document given to the Escrow Agent hereunder, nor shall the Escrow
Agent be responsible or liable in any respect on account of the identity,
authority or rights of the persons executing or delivering or purporting to
execute or deliver any such Direction or document. The Escrow Agent shall also
be fully protected in relying upon any Direction or document believed by it in
good faith to be genuine and valid and shall be fully protected in acting in
accordance with any Direction or document given to the Escrow Agent hereunder.
(c) Upon delivery or return of the Escrow Funds and the
$11.6 Million Note pursuant to this Agreement, the Escrow Agent shall have no
further responsibility or liability hereunder.
4. INVESTMENT
(a) Upon the date hereof and until 3:00 p.m. on October 10,
1995, the Escrow Agent shall not invest the Escrow Funds in any manner but
shall hold the Escrow Funds in the form of a cashier's check made payable to
"Xxxxxxx X. Xxxx" and hold such cashier's check in a secure place in the
offices of the Escrow Agent.
(b) Commencing 3:00 p.m. on October 10, 1995 and during the
remaining term of this Agreement, the Escrow Funds shall be continuously
invested and reinvested by the Escrow Agent in (i) money market funds available
through Xxxxx National Bank of Washington, D.C. that hold solely U.S. Treasury
bills or (ii) such other investments as Dart and RSH may jointly direct the
Escrow Agent by written notice. All interest or profit earned on such
investments shall be credited to the Escrow Funds to be disbursed on the terms
and subject to the conditions of this Agreement.
(c) All interest or profit earned on investments of the
Escrow Funds shall be attributed to RSH (S.S. no. ###-##-####) for tax
purposes.
5. DELIVERY OF ESCROW FUNDS
(a) Immediately upon receipt from HHH of (i) the original
Promissory Note in the form attached hereto as Exhibit A or (ii) a receipt in
the form attached hereto as Exhibit B, the Escrow Agent shall deliver to HHH
the Escrow Funds in the form of a cashier's check made payable to "Xxxxxxx X.
Xxxx." Immediately upon delivery of the Escrow Funds to HHH, the Escrow Agent
shall
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deliver the $11.6 Million Note to Dart and, unless otherwise directed by RSH,
deliver any interest or profit on the Escrow Funds, net of expenses due the
Escrow Agent, to RSH.
(b) Notwithstanding paragraph (a) of this Section 5, upon
written instructions from Dart that direct the Escrow Agent to deliver the
Escrow Funds to HHH as prepayment in full of the HHH Note, the Escrow Agent
shall promptly comply with such instructions and deliver the $11.6 Million Note
to Dart and the interest and profit on the Escrow Funds to RSH.
(c) Notwithstanding the foregoing, the Escrow Agent shall
immediately deliver the Escrow Funds, including interest and profits thereon,
to Dart and the $11.6 Million Note to RSH at any time upon written notice from
each of RSH and Dart.
(d) If the Escrow Funds have not been delivered to HHH or
otherwise returned to Dart in accordance with this Section 5 by June 30, 2000,
then the Escrow Agent shall immediately deliver the Escrow Funds, including
interest and profits thereon, to Dart.
6. TERMINATION
Upon the delivery of the Escrow Funds and the $11.6 Million
Note in accordance with Section 5 hereof, this Agreement shall cease, terminate
and be of no further force or effect.
7. CONFLICTS
If at any time the Escrow Agent shall receive conflicting
Directions or documents with respect to the Escrow Funds and cannot determine
the proper course of action to take hereunder, or if for any other reason the
Escrow Agent shall in good faith be unable to determine the party or parties
entitled to receive the Escrow Funds or any part thereof, it may refuse to make
any delivery or return thereof and retain the Escrow Funds safely in its
possession until it shall have received Directions in writing concurred in by
all parties, or until directed by a Final Order of a court of competent
jurisdiction, whereupon the Escrow Agent shall make such disposition of the
Escrow Funds in accordance with such Directions or such Final Order.
8. ESCROW FEES
The Escrow Agent shall be entitled to the fees for its
services in acting as Escrow Agent hereunder as are agreed to from time to time
between the Escrow Agent and Dart. The Escrow Agent shall be reimbursed for
all expenses reasonably incurred by it in connection with the performance of
its duties and obligations hereunder. All fees and expenses shall be borne by
RSH.
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9. INDEMNIFICATION
RSH and Dart shall jointly and severally indemnify and hold
the Escrow Agent harmless from and against any damage, cost, liability or
expense (including, but not limited to, reasonable legal fees which it may
incur by reason of its acting hereunder, except with respect to actions or
omissions taken or suffered by the Escrow Agent in bad faith, in willful
disregard of the terms of this Agreement or involving gross negligence on the
Escrow Agent's part, without prejudice to any right which any party may have to
recover from any other party for any such damage, cost, liability, expense or
legal fees.
10. REPRESENTATIVE OF DART
The duly authorized representative of Dart for purposes of receiving
funds from the Escrow Agent, giving consents or instruction to the Escrow
Agent, and for all other purposes under this Agreement, shall be Xxxxxx X.
Xxxxxx, Treasurer and Chief Financial Officer (or his duly appointed
successor).
11. NOTICES
Any notices or consents required or permitted by this
Agreement shall be in writing and shall be deemed given if delivered in person
or if sent by certified mail, postage prepaid, return receipt requested, or by
facsimile as follows, unless any such address is changed by notice hereunder:
If to Dart:
Dart Group Corporation
0000 00xx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Chief Financial Officer
Facsimile: 000-000-0000
with a copy to:
Xxxxxxx X. Xxxxx, Esq.
Xxxxx, Day, Xxxxxx & Xxxxx
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Facsimile: 000-000-0000
If to RSH:
Xxxxxx X. Xxxx
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, X.X. 00000
Facsimile: (000) 000-0000
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with a copy to:
Xxxxxx X. Xxxxx, Esq.
Blank, Rome, Xxxxxxx & XxXxxxxx
0000 Xxxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxxx, XX 00000
Facsimile: 000-000-0000
If to the Escrow Agent:
Xxxx Xxxxxxxxxx, Esq.
Settlementcorp.
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Facsimile: (000) 000-0000
12. GOVERNING LAW; JURISDICTION
This Agreement, and the documents and instruments delivered
pursuant hereto, except as otherwise provided therein, shall be construed in
accordance with and governed by the laws of the District of Columbia, without
giving effect to its conflict of law rules. The parties hereto submit to the
jurisdiction of the courts of the District of Columbia.
13. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
The covenants, agreements, representations and warranties of
the parties hereto made in this Agreement shall survive the closing of the
transactions contemplated hereby.
14. AMENDMENT; WAIVER; REMEDIES
This Agreement may be amended only by a written agreement
executed by the Escrow Agent and the other parties hereto. No delay on the
part of any party hereto in exercising any right, power or privilege hereunder
shall operate as a waiver thereof. No waiver of any of the provisions of this
Agreement or any other agreement referred to herein shall be valid unless in
writing and signed by the party against whom it is sought to be enforced. The
waiver by any party hereto of any matter provided for herein shall not be
deemed to be a waiver of any other matter provided for herein.
15. ENTIRE AGREEMENT
This Agreement and the other Agreements set forth the entire
understanding of the parties hereto and supersede all prior agreements between
them with respect to the subject matter hereof and all prior negotiations
between the parties are merged in this Agreement and the other Agreements and
documents related thereto, and there are no promises, agreements, conditions,
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undertakings, warranties or representations, oral or written, express or
implied, between them other than as herein set forth.
16. SEVERABILITY
If any one or more of the provisions contained in this
Agreement should be held to be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of all remaining provisions
shall not in any way be affected or impaired.
17. BINDING EFFECT
This Agreement, and the documents and instruments delivered
pursuant hereto, shall inure to the benefit of, and shall be binding upon, the
respective successors and permissible assigns of the parties. Dart may freely
assign its rights and delegate its duties hereunder.
18. HEADINGS
The headings in this Agreement are solely for convenience of
reference and shall not be given any effect in the construction or
interpretation of this Agreement.
19. COUNTERPARTS
This Agreement may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed, or have caused
this Agreement to be executed on their behalf, as of the date first above
written.
DART GROUP CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Treasurer and
Chief Financial Officer
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
SETTLEMENTCORP
By: /s/ Xxxx X. Xxxxxxxxxx
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Xxxx X. Xxxxxxxxxx
Vice President
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