20050119Tab 3 Escrow Agreement.pdf

EXECUTION COpy
ESCROW AGREEMENT
This ESCROW AGREEMENT (this Agreement") is dated as of October 13,2004, by and among MIRANT OREGON, LLC, a Delaware limited liability company ("SellerVISTA CORPORATION, a Washington corporation (Purchaser ) and Wilmington TrustCompany, a Delaware banking corporation (the "Escrow Agent"
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WHEREAS, concurrently herewith, Seller and Purchaser are entering into anAsset Purchase and Sale Agreement (the "Purchase A eement") dated as of eytn date herewith;
WHEREAS, pursuant to Section 2.1 of the Purchase Agreement, Purchasershall, concurrently with the execution of the Purchase Agreement, deposit the Escrow Depositwith the Escrow Agent, to be held by the Escrow Agent subject to the terms and conditions ofthis Agreement;
WHEREAS, the parties hereto have agreed upon and wish to set forth herein the
terms and conditions of this Agreement with respect to the Escrow Fund (as defined below) to beheld by the Escrow Agent.
NOW, THEREFORE, in consideration of the foregoing and for other good andvaluable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller,Purchaser and the Escrow Agent hereby covenant and agree as follows:
1. Definitions Capitalized terms used and not otherwise defined herein shall
have the meanings ascribed thereto in the Purchase Agreement.
2. Escrow Agent.Purchaser and Seller hereby designate and appoint the Escrow
Agent to serve as escrow agent with respect to the Escrow Fund, in accordance with the terms,conditions and provisions of this Agreement. The Escrow Agent hereby agrees to act as escrow
agent in accordance with the terms, conditions and provisions of this Agreement.
3. Escrow Fund. Pursuant to Section 2.1 of the Purchase Agreement, Purchaserhereby deposits into escrow with the Escrow Agent the Escrow Deposit (such amount, togetherwith any investment income thereon, the "Escrow Fund
).
The Escrow Fund held by the EscrowAgent pursuant to this Agreement shall constitute trust property for the purposes for which it is
held.
4. Obligations Secured by ~scrow Fund. The Escrow Fund shall, subject to theterms and conditions of this Agreement, be held by the Escrow Agent as a downpayment of the
purchase price payable by Purchaser at the Closing in consideration for Purchaser s acquisitionof Seller s Interest. If the Closing occurs, the Escrow Fund shall be credited toward Purchaser
payment of the Purchase Price as provided in Section 2.2 of the Purchase Agreement and, upon
receipt of the Joint Certificate contemplated by Section 2.4.2. of the Purchase Agreement, the
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Escrow Agent shall deliver the Escrow Funds to the Seller at the Closing by wire transfer ofimmediately available funds to the account of Seller designated in such Joint Certificate. In allother circumstances, the Escrow Fund shall be applied and disbursed as provided in Section 6hereof.
5. Joint Claims. If after the date hereof and before the Termination Date (asdefined below), the Escrow Agent receives a certificate signed by both Seller and Purchaser (aJoint Certificate ) directing the Escrow Agent to release and deliver the Escrow Fund asspecified in such Joint Certificate, then the Escrow Agent shall promptly follow such instructionsand transfer, assign, deliver and pay over to the person named in such Joint Certificate thebalance of the Escrow Fund without further instructions from Seller or Purchaser.
6. Claims of Seller or Purchaser.In the event that, at any time after the datehereof and before the Termination Date, the Purchase Agreement is terminated (i) by Sellerpursuant to Section 11.3 of the Purchase Agreement, (ii) by Purchaser pursuant to Section11., 11.4 or 11.5 of the Purchase Agreement, (Hi) by both Seller and Purchaser pursuant to
Section 11.1.1 of the Purchase Agreement, (iv) by either party pursuant to Section 11.1.6 of the
Purchase Agreement or (v) automatically pursuant to Section 11.1.7 of the Purchase Agreement,the terminating party (or, in the case of a termination pursuant to Section 11.1, 11.6 or 11.either Seller or Purchaser, shall deliver a certificate (a "Certificate" and the party delivering suchCertificate, the "Sender ) to the Escrow Agent, stating that the Purchase Agreement has been
terminated and identifying the provision thereof pursuant to which the Purchase Agreement hasbeen terminated, and directing the Escrow Agent to release and deliver the Escrow Fund to (i)
the Seller, in the case of any termination pursuant to Section 11.3 of the Purchase Agreementor (ii) to the Purchaser in the case of any termination of the Purchase Agreement pursuant to any
provision of Section 11.1 thereof other than Section 11.3 of the Purchase Agreement.
7. Certificates. (a) Certificates shall be sent to the Escrow Agent in accordancewith the terms of Section 16 hereof, with a copy to Seller or Purchaser (the non-Sender party), asapplicable (the "Receiver ) and shall state the date on which it was sent to the Receiver.
(b) In the event that, within ten (10) business days after the date on which the
Certificate was sent to the Receiver, the Sender and the Escrow Agent shall not have receivedfrom the Receiver a written notice of objection to the release of the Escrow Fund, then theEscrow Agent shall promptly thereafter follow the instructions set forth in the Certificate, andtransfer, assign, deliver and pay over to the Sender, the balance of the Escrow Fund withoutfurther instructions from Seller or Purchaser. For this purpose "business day" means a day onwhich banks in the place of receipt of the Certificate by the Receiver are open for business in the
ordinary course, other than Saturdays and Sundays.
8. Resolution of Claims in Dispute. In the event that the Receiver delivers awritten statement of objection, within the time and in the manner specified in Section 7 hereof,
stating that the Receiver objects to any release of the Escrow Fund, then the Escrow Agent shall
continue to hold the Escrow Fund until such time as (i) the Escrow Agent receives a JointCertificate directing the Escrow Agent to release and deliver the Escrow Fund as specified insuch Joint Certificate, or (ii) the Escrow Agent is directed pursuant to an arbitral award following
a final determination, or by a court of competent jurisdiction by a final, nonappealable judgment
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or order of such court (either such direction, an "Order ), to release and deliver the Escrow Fundto the person named in the Order. In any event described in clauses (i) or (ii) above, the Escrow
Agent shall release and deliver the Escrow Fund in accordance with such Joint Certificate orOrder.
9. Termination. This Agreement shall automatically terminate upon the date (the
Termination Date ) on which the Escrow Agent shall have disposed of the entire Escrow Fund
in accordance with the terms and conditions of this Agreement.
10. Taxes. The Purchaser hereby agrees that it shall be responsible for all taxespayable with respect to any interest or other income accrued or earned on the Escrow Deposit.At the request of the Purchaser, the Escrow Agent shall provide the Purchaser with anyinformation reasonably requested by it and available to the Escrow Agent which may be helpful
in satisfYing any tax reporting requirement applicable to the Purchaser with respect to taxes ofwhich the Purchaser is responsible.
11. Fees and Ex nses. Each of Purchaser and Seller agrees to pay the EscrowAgent fifty percent 50% of the fees set forth on Schedule 1 hereto (incorporated herein byreference). Each of Purchaser and Seller further agrees to reimburse the Escrow Agent anamount equal to fifty percent 50% of any reasonably documented expenses, including reasonablecounsel fees and expenses which it may incur in acting hereunder, and the Escrow Agent's claimtherefor shall constitute a first lien against the Escrow Fund. The provisions of this Section
shall survive the resignation or removal of the Escrow Agent and any termination of thisAgreement.
12. Res onsibilities of the Escrow A ent. The acceptance by the Escrow Agentof its duties under this Agreement is subject to the following terms and conditions, which the
parties to this Agreement hereby agree shall govern and control with respect to such EscrowAgent's rights, duties, liabilities and immunities:
(a) The Escrow Agent shall act hereunder as depository only, and it shall not
be responsible or liable in any manner whatsoever for the sufficiency of any amount
deposited with it. The duties and responsibilities of the Escrow Agent hereunder shall be
determined solely by the express provisions of this Agreement, and no further duties
responsibilities shall be implied. Except for the defined terms in the PurchaseAgreement, the Escrow Agent shall have not have any liability under, nor duty to inquireinto the terms and provisions of any agreements or instructions, other than outlined in this
Agreement.
(b) The Escrow Agent shall be protected in acting upon any written notice,request, waiver, consent, receipt or other paper or document furnished to it, not only as to
its due execution and the validity and effectiveness of its provisions but also as to thetruth and acceptability of any information therein contained, which it in good faithbelieves to be genuine and what it purports to be.
(c) The Escrow Agent shall not be liable for any en-or of judgment, or for anyact done or step taken or omitted by it, or for any mistake of fact or law or for anything
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which it may do or refrain from doing in connection herewith, except for fraud~ grossnegligence, willful misconduct or for any action taken or omitted in bad faith that a courtof competent jurisdiction determines was the primary cause of a loss to either Seller orPurchaser. The Escrow Agent shall not incur any liability for following the instructionsherein contained or expressly provided for, or written instructions given by either Seller
or Purchaser. Seller and Purchaser, jointly and severally, covenant and agree toindemnify and hold the Escrow Agent and its directors, officers, agents and employees
(collectively, the "Indemnitees ) harmless from and against any and all liabilities, losses,
damages, fines, suits, actions, demands, penalties, reasonable costs and expenses,including reasonable out-of-pocket, incidental expenses, legal fees and expenses, theallocated costs and expenses of in-house counsel and legal staff and the costs andexpenses of defending or preparing to defend against any claim (Damages ) that may beimposed on, incurred by, or asserted against, the Indemnitees or any of them forfollowing any instruction or direction upon which the Escrow Agent is authorized to relypursuant to the terms of this Agreement. In addition to and not in limitation of theimmediately preceding sentence, Seller and Purchaser, jointly and severally, alsocovenant and agree to indemnify and hold the Indemnitees and each of them harmlessfrom and against any Damages that may be imposed on, incurred by, or asserted against
the Indemnitees or any of them in connection with or arising out of the Escrow Agent'
performance under this Agreement; provided the Escrow Agent has not acted with fraud,
gross negligence or bad faith or engaged in willful misconduct. The provisions of thisSection 12(c) shall survive the termination of this Agreement and the resignation orremoval of the Escrow Agent for any reason. Anything in this Agreement to the contrary
notwithstanding, in no event shall the Escrow Agent be liable for special, indirect orconsequential loss or damage of any kind whatsoever (including but not limited to lostprofits), even if the Escrow Agent has been advised of such loss or damage andregardless of the form of action.
(d) In the administration of this Agreement and the Escrow Fund hereunder,
the Escrow Agent may consult with counselor accountants to be selected and retained byit. The Escrow Agent shall not be liable for anYthing done, suffered or omitted in goodfaith by it in accordance with the advice or opinion of any such counselor accountant.
(e) The Escrow Agent shall have no duties except those which are expressly
set forth herein, and it shall not be bound by any notice of a claim, or demand withrespect thereto, or any waiver, modification, amendment, termination or rescission of this
Agreement, unless in writing received by it.
(t) The Escrow Agent may resign at any time by giving written notice thereofto each of Seller and Purchaser, but such resignation shall not become effective until asuccessor Escrow Agent mutually agreed to by Seller and Purchaser shall have beenappointed and shall have accepted such appointment in writing. In the event that aninstrument of acceptance by a successor Escrow Agent shall not have been delivered tothe Escrow Agent within thirty (30) days after the giving of such notice of resignation,the resigning Escrow Agent may, at the joint and several expense of Seller and Purchaser,petition any court of competent jurisdiction for the appointment of a successor Escrow
Agent. The Escrow Agent shall have the right to withhold an amount from the Escrow
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Fund equal to the amount due and owing to the Escrow Agent, plus any costs andexPenses the Escrow Agent shall reasonably believe may be incurred by the EscrowAgent in connection with the appointment of a successor Escrow Agent. Any corporationor association into which the Escrow Agent in its individual capacity may be merged
converted or with which it may be consolidated, or any corporation or associationresulting from any merger, conversion or consolidation to which the Escrow Agent in itsindividual capacity shall be a party, or any corporation or association to which aU orsubstantially all of the corporate trust business of the Escrow Agent in its individualcapacity may be sold or otherwise transferred, shall be the Escrow Agent under thisAgreement without further act.
(g)
The Escrow Agent's sole duty with respect to the custody, safekeepingand physical preservation of the Escrow Fund shall be to deal such Escrow Fund
in thesame manner as the Escrow deals with similar property for its own account.
13. Investment of Escrow Fund (a) The Escrow Fund shall be invested andreinvested by the Escrow Agent in anyone or more Permitted Investments (as defined below)from time to time as maturities occur and as directed in writing by Purchaser.
Permitted Investments" shall mean each of (i) U.S. dollar denominated, direct,noncallable, full-faith-and-credit obligations of the federal government of the United States ofAmerica, (ii) certificates of deposit, banker s acceptances or time deposits having maturities ofsix months or less from the date of acquisition and issued by a United States commercial bankwhich has unsecured senior debt securities or letters of credit rated at least P-l by MoodyInvestors Service, Inc. or A-I by Standard & Poor s Corporation, (Hi) commercial paper orsecurities with maturities of 90 days or less from the date of acquisition rated at least P-l byMoodys Investors Service, Inc. and A-I by Standard & Poor s Corporation (or, with respect toclauses (ii) and (iii) above, if neither of such rating agencies is then providing ratings, theequivalent thereof by another investor service of comparable national recognition selected bySeller and reasonably acceptable to Purchaser) and (iv) a money market mutual fund whichinvests primarily in the Permitted Investments set forth in (i), (ii) or (iii).
(b) The Escrow Agent shall invest the Escrow Fund in The U.S. GovernmentPortfolio of the Wilmington Funds (a mutual fund managed by Rodney Square ManagementCorporation, a subsidiary of the Escrow Agent) in the absence of written instructions ofPurchaser as to the investment of the Escrow Fund. The parties acknowledge that shares in thismutual fund are not obligations of Wilmington Trust Company, are not deposits and are notinsured by the FDIC. The Escrow Agent or its affiliate is compensated by the mutual fund for
services rendered in its capacity as investment advisor, custodian and/or transfer agent, and suchcompensation is both described in detail in the prospectus for this mutual fund, and is in additionto the compensation paid Wilmington Trust Company in its capacity as Escrow Agent hereunder.
(c) Neither Purchaser nor the Escrow Agent shall have liability for any lossincurred as a result of investments made in accordance with the provisions of this Section.
14. Investment Income (a) All investment income shall be retained andreinvested as provided in Section 13 hereof until distributed pursuant to the terms hereof. All
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proceeds received by the Escrow Agent in respect of any investments of the Escrow Fund shall
be added to and become part of the Escrow Fund.
(b) The Escrow Agent may liquidate any investments made hereunder at suchtime as it shall deem necessary to make payments in accordance with the provisions hereof. TheEscrow Agent shall have no liability for any loss incurred as a result of liquidation made by it inaccordance with the provisions of this Section 14(b).
15. Amendment and Termination This Agreement may be amended orterminated by and upon written notice to the Escrow Agent at any time given jointly byPurchaser and Seller, but the duties or responsibilities of the Escrow Agent may not be amended
or modified without its consent.
16. Notices. All notices, requests, demands and other communications required
or permitted to be given hereunder shall be in writing and shall be deemed to have been duly
given when delivered in Person, or when sent by fax or other facsimile transmission (with receiptconfinned), or when sent via express delivery service and addressed as follows (or at such otheraddresses as the parties may designate by written notice in the manner aforesaid):
If to Purchaser:
A vista Corporation
1411 East Mission Avenue
Spokane, Washington 99220-3727
Attention: Ronald R. Peterson
Phone: [phone]
Fax: [phone]
With a copy (which shall not constitute notice) to:
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10017
Attention: J. Anthony Terrell, Esq.
Phone: [phone]
Fax: [phone]
If to Seller:
Mirant Oregon, LLC
1155 Perimeter Center Parkway
Atlanta, Georgia 30338
Attention: Anthony Ellis, Esq.
Phone: [phone]
Fax: [phone]
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with a copy (which shall not constitute notice) to:
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
Attention: Mark L. Mandel, Esq.
Phone: [phone]
Fax: [phone]
If to the Escrow Agent:
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, DE 19890
Attention: Margaret Pulgini
Phone: [phone]
Fax: [phone]
or to such other Person as shall be designated in writing by any such party, andsuch notice or communication shall be deemed to have been given as of the date of thisAgreement so delivered, sent by fax or mailed.
17. Assignment.This Agreement may not be transferred, assigned, pledged orhypothecated by any party hereto;
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however, Purchaser may assign all or any portion its rights and obligations under this Agreement to any Person, including, without limitation, to its
financing sources or financing sources of any of its subsidiaries by way of security, to anyPerson appointed to enforce such security or to any Person in connection with such enforcement.
This Agreement shall be binding upon and shall inure to the benefit of the parties and theirrespective heirs, executors, administrators, successors and permitted assigns.
18. Execution. The execution of this Agreement by the Escrow Agent shallevidence its acceptance and agreement to the terms hereof. This Agreement may be executed in
two (2) or more counterparts, each of which will be deemed an original, but all of which together
will constitute one and the same instrument. Any signature page of any such counterpart, or anyfacsimile thereof, may be attached or appended to any other counterpart to complete a fullyextended counterpart to this Agreement, and any facsimile transmission of any party s signatureto any counterpart shall be deemed an original and shall bind such party.
19. GOVERNING LAW. TInS AGREEMENT SHALL BE CONSTRUEDAND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OFDELA W ARE, EXCLUDING ONLY ITS CHOICE OF LA W RULES.
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IN WlTNBSS WHEREOF, the parties hereunto have duly caused this Agreement
to be executed u of the date first above written.
MIRANT OREGON. LLC
By.
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AnM./I1.
TItle:
jJ;'t'$ MI
vm A CORPORATION
By:
Name:
Title:
. '.
WILMINGTON TRUST COMPANY.
as Escrow Ascot
By:
Name:
Title:
... ~18&
....
..1Ift
IN WlTNBSS WHEREOF t the parties hereunto have duly caused this Ag1=mentto be executed as of the date tint above written.
MIRANT 0 RBOO N, LLC
By:
Name:
Tide:
A VJST A CORPORATION
BY:
~(?
Name: ~ld . R.
Title: V,u, Pr~tdA1,t
WILMINGTON TRUST COMPANY,
as Escrow Agent
By:
Name:
Tide:
....
.18&G8ND .. (21)
lJ(;' -E;1(:f-2B(2)4 17: "'8 W I LM I NGTON TRUST 302 636 4149 92/02
IN WITNESS WHEREOF, the panies hereunto have duly caused this Agreementto be executed as of the date first above written.
MIRANT OREOON~ LLC
By:
Name:
Title:
VISTA CORPORATION
By:
Name:
Title:
WILMINGTON TRUST COMPANY t
as Escrow Agent
By:
Name:
Title:M8Ig8f8t Pu1g1niVa Pmident
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.,
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TOTAL P. 1212
Schedule 1
Fees
Initial Fee: $3,000.
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