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EXHIBIT 2.3
FORM OF ESCROW AGREEMENT
ESCROW AGREEMENT (the "Escrow Agreement") dated as of ________
__, 1996, by and among Transamerica Corporation, a Delaware corporation
("Transamerica"), Citation Sub Corp., a Delaware corporation and a wholly owned
subsidiary of Transamerica ("Subcorp"), Trans Ocean Ltd., a Delaware
corporation ("TOL"), Xxxxx X. Xxxxxx ("Xxxxxx"), Xxxxxx X. Xxxxxx, in his
individual capacity and as trustee of The Xxxxxx Family Living Trust, and Xxxxx
X. Xxxxxx, as trustee of The Xxxxxx Family Trust (Xx. Xxxxxx and Xxx. Xxxxxx
collectively, "Xxxxxx"), and [ ] (the "Escrow Agent").
WHEREAS, Transamerica, Subcorp, TOL, Xxxxxx and Xxxxxx have
entered into an Agreement and Plan of Merger, dated as of July 24, 1996 (the
"Merger Agreement"), pursuant to which TOL has agreed, on the terms and subject
to the conditions stated therein, to become a wholly owned subsidiary of
Transamerica by Subcorp's merging with and into TOL or, under certain
circumstances, by TOL's merging with and into Subcorp (in either case, the
"Merger");
WHEREAS, pursuant to 2.3(a) of the Merger Agreement,
Transamerica has agreed to deposit into escrow with the Escrow Agent (i)
certificates representing shares of common stock of Transamerica, $1.00 par
value per share (the "Transamerica Common Shares"), with an aggregate value of
$11,000,000 and any portion (the "Unused Merger Fees") of the $2,000,000
allocated to Merger Fees under Section 4.19 of the Merger Agreement which has
not been paid out or spent in accordance with the first and second sentences of
Section 5.3(h) of the Merger Agreement within six months of the Effective Time
(together with all dividends and distributions with respect thereto, any
interest paid on any cash portion thereof and any proceeds thereof, the "Escrow
Fund A"), (ii) certificates representing Transamerica Common Shares with an
aggregate value of $2,500,000 (together with all dividends and distributions
with respect thereto, any interest paid on any cash portion thereof and any
proceeds thereof, the "Escrow Fund B"), (iii) certificates representing
Transamerica Common Shares with an aggregate value of $1,000,000 (together with
all dividends and distributions with respect thereto, any interest paid on any
cash portion thereof and any proceeds thereof, the "Escrow Fund C") and (iv)
certificates representing Transamerica Common Shares with an aggregate value of
$9,000,000 (together with all dividends and distributions with respect thereto
and any interest paid on the cash portion thereof, the "Adjustment Escrow Fund"
and together with Escrow Fund A, Escrow Fund B and Escrow Fund C, the "Escrow
Funds"), with each of the foregoing dollar amounts to be calculated using the
Deemed Average Share Price.
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WHEREAS, pursuant to Section 5.2(e) of the Merger Agreement,
Transamerica has agreed to deliver to the Escrow Agent the Shortfall Amount, if
any, but not more than $3,000,000, for distribution to the TOL Stockholders
whose shares were converted into Transamerica Common Shares pursuant to the
first sentence of Section 2.1(b) of the Merger Agreement, and the Escrow Agent
has agreed to so distribute such Shortfall Amount;
WHEREAS, the parties hereto desire to set forth the terms and
conditions under which the Escrow Funds shall be held by the Escrow Agent and
paid to either Transamerica, on the one hand, or the TOL Stockholders whose
shares were converted into Transamerica Common Stock pursuant to Section 2.1(b)
of the Merger Agreement, on the other hand, as the case may be; and
WHEREAS, the parties hereto desire that the Escrow Agent be
appointed as escrow agent to act in accordance with the terms hereof;
NOW THEREFORE, in further consideration of the mutual promises
and covenants set forth herein, the parties hereto agree as follows:
1. Capitalized Terms. Capitalized terms used herein and not
otherwise defined shall have the meanings ascribed thereto in the Merger
Agreement.
2. Appointment of the Escrow Agent. Transamerica, Subcorp,
TOL, Xxxxxx and Xxxxxx hereby appoint the Escrow Agent to act as escrow agent in
accordance with the terms hereof, and the Escrow Agent hereby accepts such
appointment.
3. Deposit of the Escrow Amount. Promptly following the
Effective Time, and, with respect to the Unused Merger Fees, promptly following
the date that is six months following the Effective Time, Transamerica shall
deliver the Escrow Funds to the Escrow Agent. Each of the Escrow Fund A, Escrow
Fund B, Escrow Fund C and the Adjustment Escrow Fund shall be held by the Escrow
Agent in a separate escrow account (collectively, the "Escrow Accounts"). Any
Transamerica Common Shares paid into the Escrow Funds shall be held as
Transamerica Common Shares in the Escrow Funds and shall not be sold,
transferred, assigned, pledged, encumbered or otherwise disposed of by the
Escrow Agent, except in accordance with the terms of this Escrow Agreement and
except as authorized by Section 2.3(e)(ii) of the Merger Agreement and Section 9
hereof. Any cash contributed to an Escrow Fund shall at all times be invested in
such overnight or short-term "investment grade" investments (with maturities of
no longer than 30 days) as Transamerica
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shall from time to time direct and shall not be sold, transferred, assigned,
pledged, encumbered or otherwise disposed of by the Escrow Agent, except in
accordance with the terms of this Escrow Agreement. The cash portion, if any, of
an Escrow Fund shall initially be invested in the U.S. Government money market
fund of a nationally known fund sponsor selected by Xxxxxx and Xxxxxx with the
approval of Transamerica, such approval not to be unreasonably withheld. The
Escrow Agent shall have no responsibility to review proposed investments or
otherwise confirm whether any proposed investments meet the investment criteria
prescribed in the preceding sentence and may rely conclusively upon an
investment instruction as authorized in accordance with such criteria.
4. Payment of Escrow Funds. (a) The Escrow Agent agrees to
deliver assets held in the Escrow Funds only in accordance with the terms and
conditions set forth herein.
(b) Payments shall be made out of the Escrow Funds from the
applicable Escrow Account in accordance with the provisions of this Escrow
Agreement and the Merger Agreement. Payments of Transamerica Common Shares, if
any, to TOL Stockholders out of any Escrow Fund shall be made to each TOL
Stockholder whose shares of TOL Common Stock were converted into Transamerica
Common Shares pursuant to the first sentence of Section 2.1(b) of the Merger
Agreement in amounts which constitute the same proportion of the Transamerica
Common Shares to be released from the applicable Escrow Fund that the
Transamerica Common Shares which each such TOL Stockholder was entitled to
receive pursuant to the first sentence of Section 2.1(b) of the Merger Agreement
bear to the Transamerica Common Shares which all TOL Stockholders whose shares
of TOL Common Stock were converted into Transamerica Common Shares pursuant to
the first sentence of Section 2.1(b) of the Merger Agreement were entitled to so
receive.
(c) Promptly following the conclusion of the 20-day period
following delivery by Transamerica to Xxxxxx and Xxxxxx of the Closing Report
and the completion of the report contemplated by the penultimate sentence of
Section 2.5(e) of the Merger Agreement, Transamerica Common Shares shall be
distributed to Transamerica and/or TOL Stockholders whose shares were converted
into Transamerica Common Shares pursuant to the first sentence of Section 2.1(b)
of the Merger Agreement, as appropriate, from the Adjustment Escrow Fund to the
extent the adjustments to be made pursuant to Sections 2.6(c), 2.6(d), 2.7(c)
and 2.7(d) of the Merger Agreement shall have been mutually resolved during such
period, so long as thereafter there shall remain in the Adjustment Escrow Fund
Transamerica Common Shares having a value, calculated by
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reference to the Deemed Average Share Price, sufficient to resolve any
adjustments which are proposed to be made by either Transamerica or by Xxxxxx
and Xxxxxx pursuant to Sections 2.6(c), 2.6(d), 2.7(c) and 2.7(d) of the Merger
Agreement and which have not yet been mutually resolved, and any further
adjustments to be made pursuant to Section 2.6(g) of the Merger Agreement.
(d) Transamerica shall not be entitled to receive any of the
assets held in Escrow Funds A, B or C unless it has delivered a Claims Notice to
the Escrow Agent, to Xxxxxx and Xxxxxx, on behalf of the TOL Stockholders, and
to the TOL Agents stating that Transamerica has a Claim or Claims for all or
part of the relevant Escrow Fund and, to the extent reasonably ascertainable,
the estimated amount thereof. With respect to any Claim against any of Escrow
Funds A, B or C delivered pursuant to Section 2.3 of the Merger Agreement,
Xxxxxx, Xxxxxx or any TOL Agent shall have fifteen business days from receipt of
a Claims Notice to serve on the Escrow Agent, with a copy to Transamerica, a
Preliminary Objecting Notice that the TOL Stockholders object to all or part of
such Claims against the applicable Escrow Fund. Xxxxxx and Xxxxxx shall have
twenty business days following delivery of the Preliminary Objecting Notice to
deliver an Objecting Notice to Transamerica. As promptly as practicable
following final resolution by agreement or mediation among Xxxxxx, Xxxxxx and
Transamerica or final determination by the federal district court in the
Northern District of California or the Superior Court of the State of California
in and for the City and County of San Francisco of any disputed Claim, as
provided in Section 2.3(d) of the Merger Agreement, the Escrow Agent shall
deliver to Transamerica the portion of the relevant Escrow Fund which has been
determined is due to Transamerica. To the extent that neither Xxxxxx nor Xxxxxx
nor any TOL Agent shall deliver a Preliminary Objecting Notice within fifteen
business days following receipt of the Claims Notice (or, if the Claims Notice
does not specify the estimated amount thereof, as soon thereafter as the amount
of the Claim is ascertainable), or, if the Preliminary Objecting Notice is
delivered within the appropriate period provided for in Section 2.3(d) of the
Merger Agreement, to the extent that neither Xxxxxx nor Xxxxxx shall deliver an
Objecting Notice within twenty business days following receipt by Transamerica
of the Preliminary Objecting Notice, the Escrow Agent shall deliver to
Transamerica the portion of the applicable Escrow Fund which it claimed in the
Claims Notice in respect of which no Preliminary Objecting Notice or Objecting
Notice, as the case may be, has been received together with all interest
actually earned and distributions made on it (after deduction or provision for
any applicable taxes).
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(e) The assets held in the Adjustment Escrow Fund shall be
delivered to Transamerica and/or distributed by the Escrow Agent to the TOL
Stockholders whose shares of TOL Common Stock were converted into Transamerica
Common Shares pursuant to the first sentence of Section 2.1(b) of the Merger
Agreement in accordance with Sections 2.5(e), 2.6(d) and 2.7(d) of the Merger
Agreement.
(f) For purposes of all Claims against any of the Escrow Funds
by Transamerica, the value of each Transamerica Common Share with respect to
which a Claim has been made by Transamerica or which Transamerica or the TOL
Stockholders whose shares were converted into Transamerica Common Shares
pursuant to the first sentence of Section 2.1(b) of the Merger Agreement were
otherwise entitled to receive, shall be deemed to be the Deemed Average Share
Price, regardless of whether the actual trading price for the Transamerica
Common Shares is greater than or lower than the Deemed Average Share Price,
which shall be adjusted to account for any split, combination or
recapitalization of Transamerica Common Shares.
(g) Unless Transamerica shall have theretofore delivered to
the Escrow Agent a Claims Notice stating that Transamerica has a Claim or Claims
against the applicable Escrow Fund pursuant to Section 2.3 of the Merger
Agreement, the amounts then remaining in such Escrow Fund together with interest
earned and distributions actually made on such amounts (after deduction for any
applicable taxes) shall, in the case of Escrow Funds A, B and C, be delivered to
the TOL Stockholders whose shares of TOL Common Stock were converted into
Transamerica Common Shares pursuant to the first sentence of Section 2.1(b) of
the Merger Agreement as promptly as practicable after the second anniversary of
the Closing Date; provided, however, that to the extent that on such second
anniversary there continues to exist an unresolved dispute regarding a Claim by
Transamerica under Section 2.3(b) of the Merger Agreement, the portion of the
applicable Escrow Fund that represents the amount of Transamerica's Claim shall
be retained in such Escrow Fund until any dispute with respect to such claim is
finally resolved; provided, further, that Xxxxxx and Xxxxxx, in their sole
discretion, may extend the period of the Escrow Funds A, B and/or C and/or cause
Transamerica Common Shares to be retained in such Escrow Funds for purposes of
satisfying any of the indemnification obligations under Section 8.10(b) or 8.11
of the Merger Agreement, in each case in the circumstances specified in Section
8.12 of the Merger Agreement; provided, finally, that any amounts remaining in
Escrow Fund B, together with interest earned and distributions actually made on
such amounts (after deduction for any applicable taxes), shall be distributed to
the TOL Stockholders
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whose shares of TOL Common Stock were converted into Transamerica Common Shares
pursuant to Section 2.1(b) of the Merger Agreement prior to the second
anniversary of the Closing Date, if the sum of the amounts from clauses (i)-(v)
of the first sentence of Section 8.11(b) of the Merger Agreement exceed the sum
of the amounts derived from clauses (x) and (y) thereof and Transamerica's costs
and expenses incurred in pursuing and/or effectuating the CAVN Recovery. In the
case of the Adjustment Escrow Fund, the amounts then remaining in such Fund,
together with interest earned and distributions actually made on such amounts
(after deductions for any applicable taxes) shall be delivered to Transamerica
and/or distributed by the Escrow Agent to the TOL Stockholders whose shares of
TOL Common Stock were converted into Transamerica Common Shares pursuant to the
first sentence of Section 2.1(b) of the Merger Agreement in accordance with
Sections 2.5(e), 2.6(d) and 2.7(d) of the Merger Agreement.
5. Termination of Escrow. Once the Escrow Funds have been paid
pursuant to Section 4 of this Escrow Agreement, this escrow and the Escrow
Agent's duties hereunder shall terminate.
6. Shortfall Amount. As soon as practicable following receipt
by the Escrow Agent of the Shortfall Amount, if any, the Escrow Agent shall
distribute the Shortfall Amount to TOL Stockholders whose shares were converted
into Transamerica Common Shares pursuant to the first sentence of Section 2.1(b)
of the Merger Agreement in amounts which constitute the same proportion which
the number of Transamerica Common Shares which each such TOL Stockholder was
entitled to receive pursuant to the first sentence of the Section 2.1(b) of the
Merger Agreement bear to the number of Transamerica Common Shares which all TOL
Stockholders whose shares of TOL Common Stock were converted into Transamerica
Common Shares pursuant to the first sentence of Section 2.1(b) of the Merger
Agreement were entitled to so receive.
7. Voting of Transamerica Common Shares. The Escrow Agent
shall cause to be voted all of the Transamerica Common Shares in the Escrow
Funds as to which it receives written instructions from TOL Stockholders whose
shares of TOL Common Stock were converted into Transamerica Common Shares
pursuant to the first sentence of Section 2.1(b) of the Merger Agreement, in
accordance with such instructions. The Escrow Agent shall rely upon the number
of Transamerica Common Shares set forth next to the name of each TOL Stockholder
on Schedule I hereto in determining how many Transamerica Common Shares a TOL
Stockholder has authority to cause the Escrow Agent to cause to be voted.
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8. Dividends and Distributions. (a) All dividends payable and
distributions made in respect of Transamerica Common Shares constituting the
Escrow Funds, any portion of the Unused Merger Fees and all interest on any cash
portion of the Escrow Funds shall be paid, in the case of the Unused Merger
Fees, into Escrow Fund A, and in the case of any such dividends, distributions
or interest, into the applicable Escrow Fund and, if not used to satisfy
expenses and Claims of Transamerica thereunder or otherwise distributed
thereunder pursuant to the procedures relating to the Adjustment Escrow Fund,
shall be distributed to Transamerica or proportionately to the TOL Stockholders
whose shares of TOL Common Stock were converted into Transamerica Common Shares
pursuant to the first sentence of Section 2.1(b) of the Merger Agreement, as the
case may be, as and when any portion of the applicable Escrow Fund to which such
dividends, distributions or interest relate is transferred to any such party.
(b) The Escrow Agent shall send a report to each TOL
Stockholder whose shares of TOL Stock are converted into Transamerica Common
Shares pursuant to the first sentence of Section 2.1(b) of the Merger Agreement
within 45 days of the end of each calendar year during the period prior to the
expiration of the Escrow Funds and promptly following their expiration
estimating the taxable income of the applicable Escrow Funds during such period
and transmitting a pro rata distribution equal to 45% of the taxable income
allocable to each such TOL Stockholder.
9. Sale of Shares in Escrow. At any time after the first
anniversary of the Closing Date, Xxxxxx and Xxxxxx are entitled to cause the
Escrow Agent to sell up to 50% of the Transamerica Common Shares then remaining
in any or all of Escrow Funds A, B and/or C and to cause the Escrow Agent to
invest and reinvest the proceeds as they from time to time deem advisable,
subject to obtaining the consent of Transamerica, which consent shall not be
unreasonably withheld. Xxxxxx and Xxxxxx shall be entitled to cause the Escrow
Agent to invest and reinvest the proceeds without the consent of Transamerica in
(i) direct obligations of, or obligations guaranteed by, the United States
government or any agency or instrumentality thereof, or (ii) savings
certificates or certificates of deposit issued by an incorporated bank organized
and doing business under the laws of the United States or any state having
combined capital and surplus of not less than $100,000,000. For purposes of all
Claims against any of the Escrow Funds, any proceeds of the sale of Transamerica
Common Shares and the investment and reinvestment thereof shall be valued at the
Deemed Average Share Price of the Transamerica Common Shares which are
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so sold, and Xxxxxx and Xxxxxx shall cause records to be maintained, on a
Share-by-Share basis for the Transamerica Common Shares which are so sold, and
which track the investment and reinvestment of the proceeds thereof, which are
sufficient to effect the valuation mechanism set forth in this Section 9. After
any Transamerica Common Shares are sold in accordance with the provisions of
this Section 9, any Claim for indemnification by Transamerica or other request
for assets that are held in any of the Escrow Funds shall first be satisfied
with the Transamerica Common Shares remaining in the applicable Escrow Fund and
thereafter with the proceeds of the sale of Transamerica Common Shares
(including the investment and reinvestment of the proceeds thereof).
10. Merger and Other Exchange Transactions. In the event of
any consolidation or merger of Transamerica with or into any other corporation
or in the event of any other transaction upon which the holders of Transamerica
Common Shares are entitled to receive cash, shares of stock, securities or other
property in exchange for their Transamerica Common Shares, the Escrow Agent, if
and to the extent directed to do so by Transamerica, shall present such
Transamerica Common Shares for such exchange, conversion or otherwise. Any such
cash, shares of stock, securities or other property received from such exchange,
conversion or otherwise shall be deposited in the Escrow Funds and shall be
disbursed in accordance with the terms of this Escrow Agreement to Transamerica
and/or the TOL Stockholders whose shares of TOL Common Stock were converted into
Transamerica Common Shares pursuant to the first sentence of Section 2.1(b) of
the Merger Agreement.
11. Merger, etc. of Transamerica. (a) Nothing contained in
this Escrow Agreement shall prevent any merger, liquidation or consolidation of
Transamerica with or into another corporation or corporations, or successive
consolidations or mergers in which Transamerica or its successor or successors
shall be a party or parties, or any sale or other conveyance of all or
substantially all of the property of Transamerica to another corporation;
provided, however, that upon any such merger, liquidation, consolidation, sale
or conveyance, other than a consolidation or merger in which Transamerica is the
continuing corporation, the rights and obligations of Transamerica under this
Escrow Agreement shall be expressly assumed, by a supplemental agreement
satisfactory in form to the Escrow Agent, executed and delivered to the Escrow
Agent by the corporation (if other than Transamerica) formed by such
consolidation, or into which Transamerica shall have merged, or to which the
assets of Transamerica shall have been distributed in liquidation, or which
shall have acquired such property.
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(b) In the case of any consolidation, merger, sale or
conveyance of or by Transamerica referred to in subsection 11(a) hereof, and
upon the execution and delivery to the Escrow Agent of the supplemental
agreement referred to therein by the successor or acquiring corporation, such
successor or acquiring corporation shall succeed to the rights and obligations
of and be substituted for Transamerica under this Escrow Agreement, with the
same effect as if such corporation had been named herein as Transamerica, and in
the event of any such sale or conveyance, Transamerica (which term shall for
this purpose mean the corporation named as "Transamerica" in the first paragraph
of this Escrow Agreement or any successor corporation which shall theretofore
have become such in the manner described in this section 11) shall be discharged
from all obligations and covenants under this Escrow Agreement and may (but need
not) be dissolved and liquidated.
12. Escrow Fees and Expenses. Transamerica, on the one hand,
and Xxxxxx and Xxxxxx, on the other hand, shall be jointly and severally liable
to pay to the Escrow Agent the fees and expenses described on the attached
schedule. The Escrow Agent shall have no duties or liabilities under this Escrow
Agreement unless and until full payment of the [Start-Up Fee]. The Escrow Agent
shall be reimbursed by Transamerica, Xxxxxx and Xxxxxx, in accordance with the
following sentence for all expenses, disbursements and advances reasonably
incurred or made by the Escrow Agent in the preparation, administration and
enforcement of this Escrow Agreement, including but not limited to reasonable
legal fees of outside counsel and related expenses. Transamerica, on the one
hand, and Xxxxxx and Xxxxxx, on the other hand, shall equally share the
reimbursement described in the immediately preceding sentence. If amounts are
remaining in Escrow Funds A, B and/or C and, in accordance with the Merger
Agreement, are available at the expiration of such Escrow Fund to be delivered
to the TOL Stockholders whose shares of TOL Common Stock are converted into
Transamerica Common Shares pursuant to Section 2.1(b) of the Merger Agreement,
Xxxxxx and Xxxxxx shall be reimbursed from the amounts then remaining in such
Escrow Funds and which are so available (but only to the extent thereof) for the
share of the fees and expenses of the Escrow Agent which each shall have paid
and for the accounting and legal fees and expenses which each shall have paid on
behalf of the TOL Stockholders in connection with claims for indemnification
pursuant to Section 8.10(a) of the Merger Agreement and any dispute relating to
the Closing Report contemplated by Section 2.5(d) of the Merger Agreement.
13. Resignation of Escrow Agent. The Escrow Agent may resign
as such at any time by giving written notice thereof
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to Transamerica, TOL, Xxxxxx and Xxxxxx. The Escrow Agent shall continue to
serve until its successor, appointed by joint notice of Transamerica, TOL,
Xxxxxx and Xxxxxx, accepts appointment as successor escrow agent and receives
the Escrow Funds. If a successor escrow agent has not been appointed or has not
accepted such appointment thirty days after such notice of a resignation has
been given, the Escrow Agent may apply, but shall have no obligation to do so,
to a court of competent jurisdiction for the appointment of a successor escrow
agent or for other appropriate relief. The terms and conditions of this Escrow
Agreement will remain unimpaired by resignation of the Escrow Agent or the
appointment of a successor escrow agent. Following the appointment of a
successor escrow agent, such person shall for all intents and purposes of this
Escrow Agreement be the "Escrow Agent" hereunder. The Escrow Agent's resignation
shall take effect upon delivery of the Escrow Accounts to a successor escrow
agent and the Escrow Agent shall thereupon be discharged from all obligations
under this Escrow Agreement, and shall have no further duties or
responsibilities in connection herewith. The obligations of TOL, Subcorp,
Transamerica, Xxxxxx and Xxxxxx to the Escrow Agent and the rights of the Escrow
Agent under Sections 13 and 15 hereof shall survive termination of this Escrow
Agreement or the resignation or removal of the Escrow Agent. In the event that
the Escrow Agent submits a notice of resignation, its only duty, until a
successor Escrow Agent shall have been appointed and shall have accepted such
appointment, shall be to hold, invest and dispose of the Escrow Accounts in
accordance with this Escrow Agreement, but without regard to any notices,
requests, instructions, demands or the like received by it from the other
parties hereto after such notice shall have been given, unless the same is a
direction that the Escrow Funds be paid or delivered in their entirety out of
the Escrow Accounts.
14. Liability of Escrow Agent. The Escrow Agent assumes no
responsibility or liability to Transamerica, TOL, Xxxxxx, Xxxxxx or any other
persons, other than to deal with the Escrow Funds held and received by it
pursuant to the terms of this Escrow Agreement. The Escrow Agent shall not be
liable for anything which it may do or refrain from doing in connection
herewith, except for actions or omissions to act that constitute gross
negligence or willful misconduct. Transamerica, Xxxxxx and Xxxxxx agree to
indemnify and hold the Escrow Agent harmless jointly and severally for all
claims, liability, loss and expense (including reasonable out-of-pocket and
incidental legal fees of outside counsel and related expenses) with respect to
anything done or not done by it in good faith in connection with any and all of
the transactions contemplated by this Escrow Agreement and in accordance with
the terms hereof (provided that such actions or inactions do not evidence gross
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negligence or willful misconduct on the part of the Escrow Agent).
15. Responsibilities and Rights of the Escrow Agent. (a) The
Escrow Agent undertakes to perform only such duties as are expressly set forth
herein. Without limiting the generality of the foregoing, the Escrow Agent shall
have no duty or responsibility as regards any: (i) security as to which a
default in the payment of principal or interest has occurred, to give notice of
default, make demand for payment or take any other action with respect to such
default; and (ii) loss occasioned by delay in the actual receipt of notice of
any payment, redemption or other transaction regarding any item in the Escrow
Accounts as to which it is authorized to take action hereunder. The Escrow Agent
may consult with counsel and shall be fully protected with respect to any action
taken in good faith in accordance with such advice.
(b) The Escrow Agent is hereby authorized to comply with any
judicial order or legal process which stays, enjoins, directs or otherwise
affects the transfer or delivery of the Escrow Accounts or any party hereto and
shall incur no liability for any delay or loss which may occur as a result of
such compliance.
(c) The Escrow Agent shall have no duty or responsibility with
regard to any loss resulting from the investment, reinvestment, sale or
liquidation of the Escrow Accounts in accordance with the terms of this Escrow
Agreement.
(d) The Escrow Agent is authorized to register securities in
the name of its nominee or nominees or, where securities are eligible for
deposit in a central depository, such as The Depository Trust Company, the
Federal Reserve Bank of New York or the Participants Trust Company, the Escrow
Agent may utilize any such depository and permit the registration of registered
securities in the name of its nominee or nominees, and Transamerica, Xxxxxx and
Xxxxxx shall hold the Escrow Agent and such nominees harmless from any liability
as holders of record. The Escrow Agent may return or deliver securities of the
same class and denomination as those deposited with it hereunder or otherwise
received by it for the Escrow Accounts, and the Escrow Agent need not retain the
particular certificates so deposited or received.
(e) Except as otherwise expressly provided herein, the Escrow
Agent is authorized to execute instructions and take other actions pursuant to
this Escrow Agreement in accordance with its customary processing practices of
similar customers and, in accordance with such practices the Escrow Agent may
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retain agents, including its own subsidiaries or affiliates, to perform certain
of such functions. The Escrow Agent shall have no liability under this Escrow
Agreement for any loss or expense other than those occasioned by the Escrow
Agent's gross negligence or willful misconduct, and, in any event, its liability
shall be limited to direct damages and shall not include any special or
consequential damages. All collection and receipt of funds or securities and all
payment and delivery of funds or securities under this Escrow Agreement shall be
made by the Escrow Agent as agent, at the risk of the other parties hereto with
respect to their actions or omissions and those of any person other than the
Escrow Agent. In no event shall the Escrow Agent be responsible or liable for
any loss due to forces beyond its control, including, but not limited to, acts
of God, flood, fire, nuclear fusion, fission or radiation, war (declared or
undeclared), terrorism, insurrection, revolution, riot, strikes or work
stoppages for any reason, embargo, government action, including any laws,
ordinances, regulations or the like which restrict or prohibit the providing of
the services contemplated by this Escrow Agreement, inability to obtain
equipment or communications facilities, or the failure of equipment or
interruption of communications facilities, and other causes whether or not of
the same class or kind as specifically named above. In the event that the Escrow
Agent is unable substantially to perform for any of the reasons described in the
immediately preceding sentence, it shall so notify the other parties hereto as
soon as reasonably practicable.
(f) The Escrow Agent shall be protected in acting upon any
written notice, request, waiver, consent, certificate, receipt, authorization,
power of attorney, or other paper or document that the Escrow Agent in good
faith reasonably believes to be genuine and what it purports to be. The Escrow
Agent is not a party to, and (except for the terms of the Merger Agreement) is
not bound by or charged with notice of any agreement out of which this Escrow
Agreement may arise or any other agreement among Transamerica, Subcorp, TOL,
Xxxxxx or Xxxxxx. Where directions or instructions for more than one of the
undersigned are required, such directions or instructions may be given by
separate instructions of similar tenor. Any of the undersigned may act hereunder
through an agent or attorney-in-fact, provided satisfactory written evidence of
authority is first furnished to the Escrow Agent.
16. Dispute Resolution. In the event of any disagreement
between any of the parties to this Escrow Agreement, or between them or any of
them and any other person, resulting in adverse claims or demands being made in
connection with the subject matter of the escrow, or in the event that the
Escrow
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Agent, reasonably and in good faith, shall be in doubt as to what action it
should take hereunder, the Escrow Agent may, at its option, refuse to comply
with any claims or demands on it, or refuse to take any action hereunder so long
as such disagreement continues or such doubt exists, and in any such event, the
Escrow Agent shall not be liable in any way or to any person for its failure or
refusal to act, and the Escrow Agent shall be entitled to continue so to refrain
from acting until (a) the rights of all parties shall have been fully and
finally adjudicated by a court of competent jurisdiction, or (b) all differences
shall have been adjusted and all doubt resolved by agreement among all of the
interested persons, and the Escrow Agent shall have been notified thereof in
writing signed by all such persons; provided, however, that the Escrow Agent
shall be under no obligation to commence or defend such proceedings. The rights
of the Escrow Agent under this paragraph are cumulative of all other rights
which it may have by law or otherwise.
17. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally,
telecopied (which is confirmed) or dispatched by a nationally recognized
overnight courier service to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):
(a) if to Transamerica or Subcorp:
Transamerica Corporation
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
with a copies to
Transamerica Leasing Inc.
000 Xxxxxxxxxxxxxx Xxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
and
Xxxxxx X. Xxxx
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy No.: (000) 000-0000
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(b) if to TOL:
Trans Ocean Ltd.
000 Xxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
with a copy to
Xxxxx X. Xxxxxxx
Xxxxxx Godward Xxxxxx Xxxxxxxxx & Xxxxx
Xxx Xxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
(c) if to Xxxxxx:
Xxxxx X. Xxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000
with a copy to
Xxxxx X. Xxxxxxx
Xxxxxx Godward Xxxxxx Xxxxxxxxx & Xxxxx
Xxx Xxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
(d) if to Xxxxxx:
c/o Xxxxxx X. Xxxxxx
000 Xxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxx 00000
with a copy to
Xxxxx X. Xxxxxxx
Xxxxxx Godward Xxxxxx Xxxxxxxxx & Xxxxx
Xxx Xxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
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(e) if to the Escrow Agent:
Attention:
Telecopy No.:
18. Counterparts. This Escrow Agreement may be executed in
counterparts, which together shall constitute one and the same Escrow Agreement.
The parties may execute more than one copy of the Escrow Agreement, each of
which shall constitute an original.
19. Entire Agreement. This Escrow Agreement, including all
exhibits and schedules hereto, constitutes the entire agreement among the
parties and supersede all prior agreements and understandings, agreements or
representations by or among the parties, written and oral, with respect to the
subject matter hereof and thereof.
20. Governing Law. This Escrow Agreement shall be governed and
construed in accordance with the laws of the State of Delaware without regard to
principles of conflicts of law.
21. Assignment. Neither this Escrow Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties. Subject to the preceding sentence, this
Escrow Agreement shall be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and assigns.
22. Amendment and Modification. This Escrow Agreement may be
amended, modified or supplemented only by written agreement of the parties
hereto.
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IN WITNESS WHEREOF, this Escrow Agreement has been signed by
or on behalf of each of the parties hereto as of the day first above written.
TRANSAMERICA CORPORATION
By:
----------------------------------------------
CITATION SUB CORP.
By:
----------------------------------------------
TRANS OCEAN LTD.
By:
----------------------------------------------
Xxxxx X. Xxxxxx
----------------------------------------------
Xxxxxx X. Xxxxxx, in his individual capacity
----------------------------------------------
Xxxxxx X. Xxxxxx, as trustee of The Xxxxxx
Family Living Trust
----------------------------------------------
Xxxxx X. Xxxxxx, as trustee of The Xxxxxx
Family Living Trust
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[ESCROW AGENT]
By: __________________________________________
Name:
Title:
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