CONFIDENTIAL — DRAFT — FOR DISCUSSION PURPOSES ONLY
ESCROW AGREEMENT
DRAFT — Circulated January 5, 2024
This Escrow Agreement (this "Agreement") is made and entered into as of __, 2024, by and among:
SKYBRIDGE FINTECH LTD., a Delaware corporation, with its principal office at 1400 Market Street, Suite 2200, Wilmington, DE 19801 (the "Company");
Each of the purchasers identified on Schedule A attached hereto (each a "Purchaser" and collectively, the "Purchasers"), including:
RIDGELINE VENTURES FUND IV, L.P., a Delaware limited partnership, with its principal office at 800 Boylston Street, 34th Floor, Boston, MA 02199;
BEACON HILL CAPITAL PARTNERS, LLC, a Delaware limited liability company, with its principal office at 222 West Adams Street, Suite 3400, Chicago, IL 60606;
NORTHSTAR INNOVATION FUND II, L.P., a Delaware limited partnership, with its principal office at 555 California Street, Suite 4100, San Francisco, CA 94104; and
HALCYON GROWTH EQUITY, L.P., a Delaware limited partnership, with its principal office at 1201 Third Avenue, Suite 5600, Seattle, WA 98101;
and
GRANITE TRUST COMPANY, N.A., a national banking association, with its principal office at 100 Summer Street, Boston, MA 02110 (the "Escrow Agent").
The Company, the Purchasers, and the Escrow Agent are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, the Company and the Purchasers have entered into or will concurrently enter into that certain Note Purchase Agreement, dated as of __, 2024 (the "Note Purchase Agreement"), pursuant to which the Purchasers will purchase convertible promissory notes of the Company (each, a "Note") in the aggregate principal amount of Sixty Million Dollars ($60,000,000);
WHEREAS, the Note Purchase Agreement contemplates an Initial Closing at which an aggregate of Forty-Five Million Dollars ($45,000,000) will be funded, and one or more subsequent closings, including a Final Closing at which an aggregate of Fifteen Million Dollars ($15,000,000) will be funded;
WHEREAS, the Parties desire to establish an escrow arrangement for the deposit, holding, and disbursement of the closing funds in connection with the transactions contemplated by the Note Purchase Agreement, in order to facilitate the orderly closing of such transactions and to provide assurance to all parties that the requisite funds are available;
WHEREAS, the Escrow Agent has agreed to serve as escrow agent and to hold, invest, and disburse the Escrow Funds (as defined below) in accordance with the terms and conditions of this Agreement; and
WHEREAS, the Parties desire to set forth the terms and conditions upon which the Escrow Agent shall hold, invest, and disburse the Escrow Funds.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
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ARTICLE I — DEFINITIONS
Section 1.1 — Definitions
As used in this Agreement, the following terms shall have the meanings set forth below:
"Agreement" means this Escrow Agreement, including all schedules and exhibits attached hereto, as the same may be amended, modified, or supplemented from time to time in accordance with the terms hereof.
"Business Day" means any day other than a Saturday, Sunday, or any other day on which banking institutions in Boston, Massachusetts or New York, New York are authorized or obligated by law or executive order to close.
"Closing Date" means, with respect to the Initial Closing, the date of the Initial Closing under the Note Purchase Agreement, and with respect to the Final Closing, the date of the Final Closing under the Note Purchase Agreement.
"Company" means Skybridge Fintech Ltd., a Delaware corporation.
"Escrow Account" means the escrow account established and maintained by the Escrow Agent at Granite Trust Company, N.A. designated as Granite Trust Escrow Account No. 4401-7829-SBF, as more fully described in Section 2.1 hereof.
"Escrow Agent" means Granite Trust Company, N.A., a national banking association, together with any successor escrow agent appointed in accordance with the terms of this Agreement.
"Escrow Fee" means the flat fee of Seven Thousand Five Hundred Dollars ($7,500) payable to the Escrow Agent in connection with its services under this Agreement, to be borne solely by the Company, as more fully described in Article VIII hereof.
"Escrow Funds" means all funds deposited in the Escrow Account from time to time by or on behalf of the Purchasers in accordance with the terms of this Agreement, together with any interest, earnings, or other income earned thereon.
"Final Closing" means the subsequent closing under the Note Purchase Agreement at which additional Purchasers fund their respective commitments, which is anticipated to include Beacon Hill Capital Partners, LLC in the amount of Five Million Dollars ($5,000,000) and Northstar Innovation Fund II, L.P. in the amount of Ten Million Dollars ($10,000,000), for an aggregate amount of Fifteen Million Dollars ($15,000,000).
"Initial Closing" means the initial closing under the Note Purchase Agreement at which an aggregate of Forty-Five Million Dollars ($45,000,000) is funded by the following Purchasers in the following amounts: Ridgeline Ventures Fund IV, L.P. in the amount of Thirty Million Dollars ($30,000,000); Beacon Hill Capital Partners, LLC in the amount of Ten Million Dollars ($10,000,000); and Halcyon Growth Equity, L.P. in the amount of Five Million Dollars ($5,000,000).
"Joint Written Instructions" means written instructions signed by an authorized representative of the Company and an authorized representative of the Majority Purchasers (or, where expressly required herein, all Purchasers), directing the Escrow Agent to release, disburse, or otherwise take action with respect to the Escrow Funds, which instructions shall be substantially in the form of Exhibit A hereto or in such other form as shall be acceptable to the Escrow Agent.
"Majority Purchasers" means, at any time of determination, Purchasers holding commitments representing more than fifty percent (50%) of the aggregate commitments of all Purchasers under the Note Purchase Agreement at such time.
"Note Purchase Agreement" means that certain Note Purchase Agreement by and among the Company and the Purchasers, dated as of __, 2024, as may be amended, restated, supplemented, or otherwise modified from time to time.
"Purchasers" means the purchasers listed on Schedule A hereto, as such schedule may be updated from time to time to reflect additional purchasers joining at subsequent closings in accordance with the terms of the Note Purchase Agreement.
"Release Conditions" means the conditions to closing set forth in the Note Purchase Agreement (including, without limitation, the conditions set forth in Sections 6.1 and 6.2 thereof) that must be satisfied or waived prior to the release of Escrow Funds to the Company in connection with the applicable Closing Date.
Section 1.2 — Construction
(a) Terms defined in the Note Purchase Agreement and not otherwise defined herein shall have the meanings ascribed to such terms in the Note Purchase Agreement. In the event of any conflict between a definition set forth in this Agreement and a definition set forth in the Note Purchase Agreement, the definition set forth in this Agreement shall control for purposes of this Agreement.
(b) References to Sections, Articles, Schedules, and Exhibits are to Sections, Articles, Schedules, and Exhibits of or to this Agreement unless the context otherwise requires. All references to "herein," "hereof," "hereunder," "hereby," and similar terms refer to this Agreement as a whole and not to any particular provision of this Agreement.
(c) The headings and captions contained in this Agreement are inserted for convenience of reference only and shall not affect the meaning or interpretation of any provision of this Agreement.
(d) Unless the context otherwise requires, words importing the singular shall include the plural, and vice versa, and words importing any gender shall include all genders. The word "including" shall mean "including, without limitation."
(e) All references to currency amounts herein are to lawful money of the United States of America.
ARTICLE II — ESTABLISHMENT OF ESCROW; DEPOSITS
Section 2.1 — Establishment of Escrow Account
(a) The Escrow Agent hereby agrees to establish and maintain the Escrow Account designated as Granite Trust Escrow Account No. 4401-7829-SBF at the offices of Granite Trust Company, N.A. in Boston, Massachusetts, for the purpose of receiving, holding, investing, and disbursing the Escrow Funds in accordance with the terms and conditions of this Agreement.
(b) The Escrow Account shall be a segregated, interest-bearing account held in the name of "Granite Trust Company, N.A., as Escrow Agent for Skybridge Fintech Ltd. Convertible Note Financing." The Escrow Agent shall hold the Escrow Funds in trust for the benefit of the Parties and shall not commingle the Escrow Funds with any other funds held by the Escrow Agent or any of its affiliates.
(c) The Escrow Agent shall maintain the Escrow Account in accordance with its customary practices and procedures for escrow accounts of similar nature and size, and in compliance with all applicable laws, rules, and regulations, including the regulations of the Office of the Comptroller of the Currency.
Section 2.2 — Deposits by Purchasers — Initial Closing
(a) On or prior to the Initial Closing Date, each of the following Purchasers shall deposit, or cause to be deposited, the following amounts into the Escrow Account by wire transfer of immediately available funds in accordance with the wire transfer instructions set forth in Schedule B attached hereto:
(b) Each Purchaser participating in the Initial Closing shall initiate its wire transfer sufficiently in advance of the Initial Closing Date to ensure that all funds are received and available in the Escrow Account on or prior to the Initial Closing Date. The Purchasers shall include in the reference line of each wire transfer the following information: "Skybridge Fintech Ltd. — Convertible Note Bridge Financing — [Purchaser Name]."
(c) The failure of any Purchaser to deposit its required amount on or prior to the Initial Closing Date shall not relieve any other Purchaser of its obligation to make its required deposit; provided, however, that the consequences of any such failure shall be governed by the terms of the Note Purchase Agreement.
Section 2.3 — Deposits by Purchasers — Final Closing
(a) On or prior to the Final Closing Date, each of the following Purchasers shall deposit, or cause to be deposited, the following amounts into the Escrow Account by wire transfer of immediately available funds in accordance with the wire transfer instructions set forth in Schedule B:
(b) Any Purchaser joining the financing at the Final Closing that is not already a party to this Agreement shall execute a Joinder Agreement in form and substance reasonably acceptable to the Company and the Escrow Agent, pursuant to which such Purchaser shall agree to be bound by the terms of this Agreement as if it were an original signatory hereto. Upon execution of any such Joinder Agreement, Schedule A hereto shall be updated to reflect the addition of such Purchaser.
(c) The Escrow Agent shall have no obligation to verify that any Purchaser participating in the Final Closing has executed the Joinder Agreement or any other agreement required under the Note Purchase Agreement; the Escrow Agent's sole obligation shall be to receive and hold the deposited funds in accordance with this Agreement.
Section 2.4 — Confirmation of Deposits
(a) The Escrow Agent shall promptly confirm receipt of each deposit in writing (including by email) to the following persons:
(i) On behalf of the Company: David Lindstrom, Chief Financial Officer (email: dlindstrom@skybridgefintech.com), and Priya Ramanathan, General Counsel (email: pramanathan@skybridgefintech.com);
(ii) Counsel for the Company: Calderwood & Harkness LLP, Attention: Leonard Ashford, Of Counsel (email: lashford@calderwoodharkness.com); and
(iii) Counsel for the Purchasers: Whitfield, Pratt & Soo LLP, Attention: Graham Whitfield (email: gwhitfield@whitfieldprattsoo.com).
(b) Each confirmation shall specify the name of the depositing Purchaser, the amount deposited, and the date and time of receipt of such deposit by the Escrow Agent. The Escrow Agent shall use commercially reasonable efforts to provide such confirmation within one (1) Business Day of receipt of the applicable deposit.
(c) The Escrow Agent shall, upon request by the Company or any Purchaser, provide a written statement of the balance of the Escrow Account, including all deposits received and any interest or other income credited thereto.
ARTICLE III — INVESTMENT OF ESCROW FUNDS
Section 3.1 — Permitted Investments
(a) Pending disbursement in accordance with the terms of this Agreement, the Escrow Agent shall invest and reinvest the Escrow Funds, at the joint written direction of the Company and the Majority Purchasers, in one or more of the following permitted investments:
(i) Direct obligations of the United States of America, or obligations the timely payment of principal and interest on which are fully and unconditionally guaranteed by the United States of America;
(ii) Money market mutual funds that are rated "AAA" (or the equivalent) by at least one nationally recognized statistical rating organization (as such term is defined in Section 3(a)(62) of the Securities Exchange Act of 1934, as amended);
(iii) Certificates of deposit, time deposits, or demand deposits at Granite Trust Company, N.A., or any affiliate thereof; or
(iv) Such other investments as may be mutually agreed in writing by the Company and the Majority Purchasers, with the prior written consent of the Escrow Agent.
(b) In the absence of specific written investment instructions from the Company and the Majority Purchasers, the Escrow Agent shall invest the Escrow Funds in a money market deposit account at Granite Trust Company, N.A. The Escrow Agent shall have no liability for any loss of principal or interest resulting from any investment or reinvestment of the Escrow Funds made in accordance with this Section 3.1, including any loss resulting from the liquidation of any investment prior to its maturity.
(c) The Escrow Agent shall liquidate any investment of the Escrow Funds as necessary to make any disbursement or distribution required under this Agreement. The Escrow Agent shall not be liable for any loss, cost, penalty, or other diminution in value resulting from such liquidation.
Section 3.2 — Earnings
(a) All interest, dividends, and other income earned on the investment or reinvestment of the Escrow Funds shall be credited to the Escrow Account and shall become part of the Escrow Funds for all purposes of this Agreement.
(b) Upon release of the Escrow Funds to the Company in accordance with Section 4.1 or Section 4.2, any accumulated interest and other income shall be released to the Company together with the principal Escrow Funds. Upon return of the Escrow Funds to the Purchasers in accordance with Section 4.3, any accumulated interest and other income shall be allocated and returned to the Purchasers pro rata in proportion to their respective deposits in the Escrow Account.
Section 3.3 — Tax Reporting
(a) For all federal, state, and local tax reporting purposes, all interest, dividends, and other income earned on the Escrow Funds shall be reported as income of the Company (Employer Identification Number: 83-2147605). The Company shall be responsible for the payment of all taxes, if any, arising from such income.
(b) The Company shall provide the Escrow Agent with a completed and properly executed Internal Revenue Service Form W-9 (or any applicable successor or substitute form) upon execution of this Agreement and promptly upon any change in the information reflected therein. Each Purchaser shall provide the Escrow Agent with a completed and properly executed Form W-9 (or applicable substitute form) upon request by the Escrow Agent.
(c) The Escrow Agent shall issue Internal Revenue Service Form 1099 or other applicable tax information reporting forms as required by applicable law with respect to any interest, dividends, or other income earned on the Escrow Funds. The Escrow Agent shall have no obligation to determine the tax consequences of any distribution or other transaction contemplated by this Agreement.
ARTICLE IV — RELEASE AND DISBURSEMENT OF ESCROW FUNDS
Section 4.1 — Release Upon Satisfaction of Closing Conditions — Initial Closing
(a) Upon the Escrow Agent's receipt of Joint Written Instructions from the Company and the Majority Purchasers (or their respective counsel, if authorized in writing by the Company and the Majority Purchasers, respectively) certifying that all Release Conditions for the Initial Closing have been satisfied or waived in accordance with the terms of the Note Purchase Agreement, the Escrow Agent shall, within one (1) Business Day following the Escrow Agent's receipt of such Joint Written Instructions, release the Initial Closing Escrow Funds in the amount of Forty-Five Million Dollars ($45,000,000), together with all accrued and unpaid interest thereon, from the Escrow Account by wire transfer of immediately available funds to the Company's designated operating account pursuant to the wire transfer instructions provided by the Company in Schedule C attached hereto.
(b) The Joint Written Instructions for the Initial Closing shall be substantially in the form of Exhibit A attached hereto and shall certify, among other things, that (i) the Release Conditions for the Initial Closing set forth in the Note Purchase Agreement have been satisfied or waived, (ii) the aggregate amount to be released and (iii) the wire transfer instructions for the disbursement.
(c) The Escrow Agent shall have no obligation to independently verify or confirm the satisfaction or waiver of any Release Condition and shall be entitled to rely conclusively upon the certifications contained in the Joint Written Instructions.
Section 4.2 — Release Upon Satisfaction of Closing Conditions — Final Closing
(a) Upon the Escrow Agent's receipt of Joint Written Instructions from the Company and the Majority Purchasers (or their respective counsel, if authorized in writing) certifying that all Release Conditions for the Final Closing have been satisfied or waived in accordance with the terms of the Note Purchase Agreement, the Escrow Agent shall, within one (1) Business Day following the Escrow Agent's receipt of such Joint Written Instructions, release the Final Closing Escrow Funds in the amount of Fifteen Million Dollars ($15,000,000), together with all accrued and unpaid interest thereon attributable to such funds, from the Escrow Account by wire transfer of immediately available funds to the Company's designated operating account pursuant to the wire transfer instructions provided by the Company in Schedule C.
(b) The Joint Written Instructions for the Final Closing shall be substantially in the form of Exhibit A, modified as appropriate to reflect the Final Closing amounts and the applicable Release Conditions.
(c) In the event that the Final Closing occurs prior to the Initial Closing, or in the event that the Initial Closing and the Final Closing occur simultaneously, the Joint Written Instructions may be combined into a single instruction directing the release of the aggregate Escrow Funds.
Section 4.3 — Return of Escrow Funds to Purchasers
(a) If the Company and the Majority Purchasers deliver Joint Written Instructions directing the Escrow Agent to return the Escrow Funds (or any portion thereof) to the Purchasers, the Escrow Agent shall return such funds to the respective Purchasers, pro rata based on their respective deposits in the Escrow Account, within two (2) Business Days following the Escrow Agent's receipt of such Joint Written Instructions, by wire transfer of immediately available funds to the respective accounts designated by the Purchasers.
(b) If the Note Purchase Agreement is terminated prior to the Initial Closing or the Final Closing (as applicable) and the Escrow Agent receives (i) Joint Written Instructions directing the return of the Escrow Funds to the Purchasers, or (ii) a written notice of termination of the Note Purchase Agreement executed by the Company, the Escrow Agent shall return the applicable Escrow Funds to the Purchasers within two (2) Business Days following receipt of such instructions or notice. Any accrued interest on such Escrow Funds shall be allocated and returned to the Purchasers pro rata in proportion to their respective deposits.
(c) Upon the return of all Escrow Funds (including accrued interest) to the Purchasers in accordance with this Section 4.3, the Escrow Agent shall have no further obligation with respect to the Escrow Funds so returned, and the obligations of the Escrow Agent with respect thereto shall terminate, subject to the survival provisions of Section 10.1.
Section 4.4 — Partial Releases
(a) The Parties may, from time to time, deliver Joint Written Instructions directing partial releases of Escrow Funds, specifying the amount to be released, the identity of the payee, and the wire transfer instructions for such partial release.
(b) The Escrow Agent shall have no obligation to verify that any partial release is consistent with the terms of the Note Purchase Agreement or any other agreement among the Company and the Purchasers. The Escrow Agent may rely solely on properly executed Joint Written Instructions in effecting any partial release and shall have no liability for acting in accordance therewith.
(c) Following any partial release, the remaining Escrow Funds shall continue to be held and invested by the Escrow Agent in accordance with the terms of this Agreement.
Section 4.5 — Disbursement of Escrow Fee
(a) The Escrow Agent is authorized, at the Company's election, to deduct the Escrow Fee of Seven Thousand Five Hundred Dollars ($7,500) from the Escrow Funds upon the first release of Escrow Funds to the Company pursuant to Section 4.1 or Section 4.2. Alternatively, the Company may pay the Escrow Fee by separate wire transfer to the Escrow Agent on or prior to the Initial Closing Date. The Company shall notify the Escrow Agent in writing of its election prior to the Initial Closing Date.
(b) The Escrow Fee is a flat fee covering all services to be performed by the Escrow Agent under this Agreement, including services in connection with both the Initial Closing and the Final Closing. The Escrow Fee is borne solely by the Company. No portion of the Escrow Fee shall be charged to or reimbursed by any Purchaser.
(c) In the event that the Escrow Funds are returned to the Purchasers pursuant to Section 4.3 before the Escrow Fee has been paid or deducted, the Company shall pay the Escrow Fee directly to the Escrow Agent within five (5) Business Days following such return.
ARTICLE V — DUTIES AND OBLIGATIONS OF THE ESCROW AGENT
Section 5.1 — Scope of Duties
(a) The Escrow Agent shall act solely as a stakeholder and depository with respect to the Escrow Funds and shall have only such duties and obligations as are expressly set forth in this Agreement. No implied duties, obligations, or covenants shall be read into this Agreement against the Escrow Agent.
(b) The Escrow Agent shall not be deemed a trustee or fiduciary with respect to any Party or the Escrow Funds, except to the extent expressly provided herein. The Escrow Agent's duties are ministerial in nature, and the Escrow Agent shall have no duty to enforce any obligation of any person to make any payment or deposit, or to direct or cause any disbursement of funds, except as expressly provided herein.
(c) The Escrow Agent shall not be required to take any action under this Agreement that the Escrow Agent reasonably believes to be in conflict with any applicable law, regulation, or court order, or which would expose the Escrow Agent to personal liability, unless the Escrow Agent has been provided with indemnity satisfactory to it in its sole discretion.
(d) The Escrow Agent shall not be obligated to take any legal action or institute any proceedings in connection with the Escrow Funds or this Agreement, or to appear in, prosecute, or defend any such legal action or proceedings.
Section 5.2 — Reliance on Instructions
(a) The Escrow Agent may rely, and shall be fully protected in acting or refraining from acting, upon any written notice, instruction, certificate, statement, request, consent, or other document or instrument (each, an "Instruction") delivered to it that the Escrow Agent in good faith believes to be genuine and to have been signed or presented by the proper person or persons authorized to sign or present such Instruction.
(b) The Escrow Agent may rely on Joint Written Instructions without independent investigation or verification and shall not be liable for any action taken or omitted in good faith in accordance with such Joint Written Instructions. The Escrow Agent shall have no duty or obligation to review, interpret, or analyze the Note Purchase Agreement or any other agreement between or among the Company and the Purchasers, and the Escrow Agent shall have no responsibility for the performance or non-performance by any Party of its obligations under any such agreement.
(c) Notices and instructions to the Escrow Agent shall be delivered in writing and signed by authorized representatives of the relevant Parties. Instructions delivered by email shall be acceptable if confirmed by an original signed copy delivered to the Escrow Agent within three (3) Business Days of the date of such email; provided, however, that the Escrow Agent shall be entitled to act on such email instructions prior to receipt of the original signed copy without incurring any liability therefor.
(d) The Escrow Agent shall not be responsible for delays in the performance of its duties hereunder caused by conditions beyond its reasonable control, including interruption of communications or power supply, suspension of wire transfer systems, or other circumstances constituting force majeure events as described in Section 6.2(d).
Section 5.3 — Authorized Representatives
(a) The Company hereby designates the following persons as authorized to provide Instructions to the Escrow Agent on behalf of the Company, each of whom shall have the authority to act individually:
(i) David Lindstrom, Chief Financial Officer; and
(ii) Priya Ramanathan, General Counsel.
(b) Each Purchaser shall designate one or more authorized representatives, as set forth on Schedule A attached hereto. Each Purchaser may change its authorized representative(s) by delivering written notice to the Escrow Agent, signed by the Purchaser's then-current authorized representative or an officer of the Purchaser (or, in the case of a limited partnership, an authorized representative of its general partner). Any such change shall be effective upon receipt by the Escrow Agent.
(c) The Company may change its authorized representatives by delivering written notice to the Escrow Agent, signed by the Company's then-current authorized representative or any officer of the Company. Any such change shall be effective upon receipt by the Escrow Agent.
(d) The Escrow Agent shall be entitled to rely on the most recent list of authorized representatives received by the Escrow Agent and may assume that any person so listed has full power and authority to act on behalf of the designating Party with respect to all matters arising under this Agreement. The Escrow Agent shall have no obligation to inquire into the authority of any person purporting to act as an authorized representative of a Party.
Section 5.4 — Resignation and Removal of Escrow Agent
(a) The Escrow Agent may resign and be discharged from its duties under this Agreement by giving not less than thirty (30) days' prior written notice to the Company and each Purchaser, specifying a date upon which such resignation shall take effect. Such resignation shall be effective upon the appointment of a successor escrow agent in accordance with Section 5.5 or, if no successor has been appointed, upon the date specified in such notice, provided that the Escrow Agent has taken the actions described in paragraph (c) below.
(b) The Company and the Majority Purchasers may remove the Escrow Agent at any time by giving not less than thirty (30) days' prior written notice to the Escrow Agent, specifying a date upon which such removal shall take effect. Such removal shall be effective upon the appointment of a successor escrow agent in accordance with Section 5.5 or upon the date specified in such notice, whichever is later.
(c) If no successor escrow agent has been appointed and has accepted such appointment within thirty (30) days after the giving of any notice of resignation or removal pursuant to this Section 5.4, the Escrow Agent may deposit the Escrow Funds with a court of competent jurisdiction in the Commonwealth of Massachusetts and shall thereupon be relieved of all further duties, obligations, and liability under this Agreement with respect to the Escrow Funds so deposited, subject to the survival provisions of Section 10.1.
Section 5.5 — Successor Escrow Agent
(a) In the event of the resignation or removal of the Escrow Agent pursuant to Section 5.4, a successor escrow agent shall be appointed by the mutual written agreement of the Company and the Majority Purchasers. The successor escrow agent shall be a bank or trust company organized under the laws of the United States or any state thereof having a combined capital and surplus of not less than Five Hundred Million Dollars ($500,000,000).
(b) Upon the appointment and acceptance of a successor escrow agent, the Escrow Agent shall transfer and deliver the Escrow Funds, together with all records, documents, and instruments relating to the Escrow Account, to such successor escrow agent within five (5) Business Days following the effective date of such appointment. Upon such transfer and delivery, the Escrow Agent shall be fully released and discharged from all further duties, obligations, and liability under this Agreement, subject to the survival provisions of Section 10.1.
(c) Any successor escrow agent appointed under this Section 5.5 shall execute and deliver to each Party an instrument accepting such appointment, whereupon such successor escrow agent shall succeed to all of the rights, duties, and obligations of the Escrow Agent under this Agreement as if originally named herein.
ARTICLE VI — INDEMNIFICATION AND LIABILITY
Section 6.1 — Indemnification of Escrow Agent
(a) The Company and each Purchaser (severally, not jointly, and pro rata based on their respective aggregate commitments under the Note Purchase Agreement) shall indemnify, defend, and hold harmless the Escrow Agent and its officers, directors, employees, agents, and representatives (collectively, the "Escrow Agent Indemnitees") from and against any and all losses, liabilities, damages, claims, costs, and expenses (including reasonable and documented attorneys' fees and disbursements) (collectively, "Losses") arising out of or in connection with this Agreement or the Escrow Agent's performance of its duties hereunder, except to the extent that such Losses are finally determined by a court of competent jurisdiction to have been caused by the Escrow Agent's gross negligence, willful misconduct, or bad faith.
(b) The Company's indemnification obligations under this Section 6.1 are primary and shall not be contingent upon the Purchasers' performance of their respective indemnification obligations hereunder. The Escrow Agent may seek indemnification from the Company in the first instance without first making demand upon any Purchaser. The Company shall have the right to seek contribution from the Purchasers for their respective pro rata shares of any indemnification amounts paid by the Company on behalf of the Purchasers.
(c) The obligations of the Company and the Purchasers under this Section 6.1 shall survive the resignation or removal of the Escrow Agent and the termination of this Agreement.
Section 6.2 — Limitation of Liability
(a) The Escrow Agent shall not be liable for any act or omission taken or suffered in good faith and in accordance with the terms of this Agreement, except for Losses arising from the Escrow Agent's own gross negligence, willful misconduct, or bad faith, as finally determined by a court of competent jurisdiction.
(b) The Escrow Agent shall not be liable for any loss of principal or income arising from the investment or reinvestment of the Escrow Funds in accordance with Section 3.1 hereof, or for any decline in the value of any permitted investment, or for the failure of any financial institution in which the Escrow Funds are deposited.
(c) In no event shall the Escrow Agent be liable for any indirect, incidental, consequential, special, exemplary, or punitive damages of any kind (including lost profits, lost revenues, or loss of business opportunity), regardless of the form of action and whether or not such damages were foreseeable.
(d) The Escrow Agent shall not be liable for, and shall be excused from, delays in the performance of its obligations hereunder caused by force majeure events, including, without limitation, acts of God, fire, flood, earthquake, hurricane, epidemic, pandemic, war, terrorism, civil unrest, strike or labor dispute, governmental action or regulation, failure of electrical power or telecommunications systems, failure or disruption of wire transfer systems (including the Fedwire Funds Service or the Clearing House Interbank Payments System), or any other cause beyond the Escrow Agent's reasonable control.
Section 6.3 — Right to Legal Counsel
(a) The Escrow Agent may, at any time and from time to time, consult with legal counsel of its own selection (who may be counsel to any Party, but shall not be required to be) with respect to any question arising under or in connection with this Agreement or the Escrow Agent's duties hereunder. The Escrow Agent shall not be liable for any action taken, suffered, or omitted in good faith on the advice of such counsel.
(b) The reasonable and documented fees and expenses of such legal counsel incurred by the Escrow Agent in connection with its duties under this Agreement, including in connection with any dispute arising under Article VII hereof, shall be reimbursed by the Company promptly upon presentation of invoices therefor, subject to the Company's right to seek contribution from the Purchasers as described in Section 6.1(b).
ARTICLE VII — DISPUTES
Section 7.1 — Conflicting Instructions
(a) If the Escrow Agent receives or becomes aware of conflicting Joint Written Instructions, conflicting claims, conflicting demands, or conflicting notices with respect to the Escrow Funds, or if the Escrow Agent is in doubt as to what action to take, the Escrow Agent shall be entitled to refrain from taking any action (other than to continue to hold the Escrow Funds in the Escrow Account and invest the same in accordance with Section 3.1) until:
(i) the conflict or doubt is resolved by the mutual written agreement of the disputing Parties, which agreement is confirmed in writing to the Escrow Agent in a form reasonably acceptable to the Escrow Agent; or
(ii) the Escrow Agent receives a final, non-appealable order, judgment, or decree of a court of competent jurisdiction directing the disposition of the Escrow Funds.
(b) The Escrow Agent shall not be liable for any delay in performance resulting from conflicting instructions, conflicting claims, or doubt as to the proper course of action, and the Escrow Agent shall incur no liability for its failure to act until any such conflict or doubt has been resolved as described in paragraph (a) above.
(c) In the event of any conflict or dispute, the Escrow Agent may, but shall not be required to, give written notice to all Parties of the existence of such conflict or dispute and the Escrow Agent's intention to refrain from acting pending resolution thereof.
Section 7.2 — Interpleader
(a) In the event of any dispute, disagreement, or conflicting claim regarding the Escrow Funds or the proper interpretation of this Agreement, the Escrow Agent shall be entitled, in its sole discretion, to tender the Escrow Funds (or any disputed portion thereof) into a court of competent jurisdiction by interpleader action or similar proceeding, and upon such tender, the Escrow Agent shall be discharged from all further duties, liabilities, and obligations under this Agreement with respect to the Escrow Funds so tendered, subject to the survival provisions of Section 10.1.
(b) All costs and expenses of any such interpleader action or proceeding, including the Escrow Agent's reasonable and documented attorneys' fees and court costs, shall be borne by the Company. The Escrow Agent shall be entitled to deduct such costs and expenses from the Escrow Funds prior to tendering the remainder into court, or to seek reimbursement from the Company, at the Escrow Agent's election.
(c) The filing of an interpleader action shall not deprive the Escrow Agent of its compensation and reimbursement rights under Article VIII hereof.
ARTICLE VIII — ESCROW AGENT COMPENSATION
Section 8.1 — Escrow Fee
(a) The Company shall pay the Escrow Agent a flat fee of Seven Thousand Five Hundred Dollars ($7,500) for all services rendered by the Escrow Agent under this Agreement (the "Escrow Fee"). The Escrow Fee shall compensate the Escrow Agent for all ordinary services to be performed hereunder, including the establishment and maintenance of the Escrow Account, the receipt and investment of Escrow Funds, the processing of disbursements in connection with both the Initial Closing and the Final Closing, and the preparation and delivery of confirmations and statements.
(b) The Escrow Fee is non-refundable and shall be earned upon execution of this Agreement. Payment of the Escrow Fee shall be made on or prior to the Initial Closing Date by separate wire transfer from the Company to the Escrow Agent, or deducted from the initial release of Escrow Funds to the Company, at the Company's election, as provided in Section 4.5.
(c) The Escrow Fee does not include extraordinary services, including services rendered by the Escrow Agent in connection with any dispute, interpleader action, litigation, or other proceedings arising under or in connection with this Agreement. Compensation for extraordinary services shall be agreed upon by the Company and the Escrow Agent and shall be the sole responsibility of the Company.
Section 8.2 — Reimbursement of Expenses
(a) The Company shall reimburse the Escrow Agent for all reasonable and documented out-of-pocket expenses incurred by the Escrow Agent in connection with the performance of its duties under this Agreement, including, without limitation, wire transfer fees, postage, insurance, courier charges, and similar administrative costs. The Escrow Agent shall submit invoices for such expenses to the Company on a monthly basis, and the Company shall pay such invoices within thirty (30) days of receipt.
(b) Any extraordinary expenses incurred by the Escrow Agent, including legal fees incurred in connection with disputes under Article VII, requests for legal opinions, or compliance with subpoenas or court orders relating to the Escrow Funds, shall be reimbursed by the Company upon presentation of invoices therefor. The Escrow Agent shall use commercially reasonable efforts to notify the Company promptly upon becoming aware that extraordinary expenses are being or may be incurred.
ARTICLE IX — REPRESENTATIONS AND WARRANTIES
Section 9.1 — Representations of the Company
The Company hereby represents and warrants to the Purchasers and the Escrow Agent as follows:
(a) The Company is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware (Delaware Secretary of State File Number 6384291).
(b) The Company has all necessary corporate power and authority to execute, deliver, and perform its obligations under this Agreement and to consummate the transactions contemplated hereby.
(c) The execution, delivery, and performance of this Agreement by the Company have been duly authorized by all necessary corporate action on the part of the Company, including approval by the Company's board of directors, and no further corporate proceedings on the part of the Company are necessary to authorize the execution, delivery, or performance of this Agreement.
(d) This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, and other similar laws affecting creditors' rights generally and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
(e) The execution, delivery, and performance of this Agreement by the Company do not and will not (i) violate or conflict with the certificate of incorporation or bylaws of the Company, (ii) violate any applicable law, rule, or regulation, or (iii) conflict with or result in a breach of any material agreement to which the Company is a party.
Section 9.2 — Representations of the Purchasers
Each Purchaser hereby severally (and not jointly) represents and warrants to the Company and the Escrow Agent as follows:
(a) Such Purchaser is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization.
(b) Such Purchaser has all necessary limited partnership, limited liability company, or other organizational power and authority to execute, deliver, and perform its obligations under this Agreement and to consummate the transactions contemplated hereby.
(c) The execution, delivery, and performance of this Agreement by such Purchaser have been duly authorized by all necessary organizational action on the part of such Purchaser, including, in the case of a limited partnership, by its general partner.
(d) This Agreement has been duly executed and delivered by such Purchaser and constitutes a valid and binding obligation of such Purchaser, enforceable against such Purchaser in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, and other similar laws affecting creditors' rights generally and to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
Section 9.3 — Representations of the Escrow Agent
The Escrow Agent hereby represents and warrants to the Company and the Purchasers as follows:
(a) The Escrow Agent is a national banking association duly organized, validly existing, and in good standing under the laws of the United States, with its principal office located at 100 Summer Street, Boston, MA 02110.
(b) The Escrow Agent has full corporate power and authority to execute, deliver, and perform its obligations under this Agreement, including the authority to establish the Escrow Account, receive and hold the Escrow Funds, invest the Escrow Funds, and make disbursements from the Escrow Account, all in accordance with the terms hereof.
(c) The execution, delivery, and performance of this Agreement by the Escrow Agent have been duly authorized by all necessary corporate action on the part of the Escrow Agent.
(d) The Escrow Agent is not a party to or bound by any agreement, obligation, or court order that would prevent, restrict, or conflict with the Escrow Agent's ability to perform its duties and obligations under this Agreement.
(e) The Escrow Agent maintains insurance coverage and fidelity bonds in amounts customary for escrow agents performing services of the type contemplated by this Agreement.
ARTICLE X — TERMINATION
Section 10.1 — Termination
(a) This Agreement shall terminate upon the earliest to occur of the following:
(i) the disbursement of all Escrow Funds from the Escrow Account in accordance with the terms hereof, including all accrued interest and other income thereon;
(ii) the return of all Escrow Funds to the Purchasers pursuant to Section 4.3 hereof;
(iii) the deposit of the Escrow Funds with a court of competent jurisdiction pursuant to Section 5.4(c) or Section 7.2 hereof; or
(iv) the mutual written agreement of all Parties to terminate this Agreement.
(b) Notwithstanding the termination of this Agreement, the following provisions shall survive such termination and shall remain in full force and effect in accordance with their respective terms:
(i) Article VI (Indemnification and Liability), including without limitation the indemnification obligations of the Company and the Purchasers in favor of the Escrow Agent;
(ii) Article VIII (Escrow Agent Compensation), to the extent of any unpaid Escrow Fee, unreimbursed expenses, or other amounts owing to the Escrow Agent as of the date of termination;
(iii) Section 11.8 (Governing Law) and Section 11.9 (Waiver of Jury Trial); and
(iv) any other provision of this Agreement that by its nature or terms is intended to survive termination.
(c) Upon termination of this Agreement and final disbursement or deposit of all Escrow Funds, the Escrow Agent shall close the Escrow Account and shall have no further obligations hereunder, except as expressly provided in the surviving provisions identified in paragraph (b) above.
ARTICLE XI — MISCELLANEOUS
Section 11.1 — Notices
(a) All notices, requests, demands, consents, instructions, and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if (i) delivered by hand, upon delivery; (ii) sent by nationally recognized overnight courier service (with tracking capability), upon the next Business Day following deposit with such courier; or (iii) sent by email, upon transmission, provided that a confirmation copy is sent by overnight courier within one (1) Business Day. All notices shall be addressed as follows:
If to the Company:
Skybridge Fintech Ltd. 1400 Market Street, Suite 2200 Wilmington, DE 19801
Attention: David Lindstrom, Chief Financial Officer, and Priya Ramanathan, General Counsel