EXHIBIT 10.45
ESCROW AGREEMENT
BY AND AMONG
SURESCRIPTS, LLC,
PROXYMED, INC.,
AND
SUNTRUST BANK
THIS ESCROW AGREEMENT(this“Agreement”), dated as of April 30, 2007, ismade by and among SureScripts, LLC, a limited liability company duly organized and validlyexisting under the laws of the Commonwealth of Virginia (“Buyer”), ProxyMed, Inc. d/b/aMedAvant Healthcare Solutions, a corporation duly organized and validly existing under thelaws of the State of Florida (“Seller”), and SunTrust Bank, a Georgia Banking corporation (the“Escrow Agent”and, together with Buyer and Seller, the“Parties”).
WHEREAS,Buyer and Seller have entered into that certain Purchase Agreement, datedas of the date hereof, a copy of which is attached hereto (the“Purchase Agreement”); and
WHEREAS,the Purchase Agreement contemplates that Buyer and Seller will enter intothis Agreement in connection with the payment of one hundred thousand dollars ($100,000) ofthe Purchase Price to Seller.
NOW, THEREFORE, in consideration of the premises and covenants as set forthherein, and subject to the representations, warranties, and conditions contained herein, the Partiesagree as follows:
Section 1.Recitals.The foregoing recitals are restated and incorporated intothis Agreement as fully as if set forth herein.
Section 2.Purchase Agreement.Undefined capitalized terms used herein aredefined in the Purchase Agreement. Except for referring to definitions of certain undefinedcapitalized terms herein, the Escrow Agent is not charged with any duties or responsibilitiesunder the Purchase Agreement.
Section 3.Escrow Fund.
3.1Escrow Deposit. Upon execution of this Agreement and the PurchaseAgreement, Buyer shall deposit with Escrow Agent one hundred thousand dollars ($100,000)(the“Escrow Deposit”) into SunTrust Bank, ABA: 061000104, Account: 9443001321, AccountName: Corporate Agency Services, Reference: SureScripts/ProxyMed – 7920801, Attention:Emily J. Hare (804) 782-5400. The term“Escrow Fund” means the Escrow Deposit and allaccumulated interest thereon. Escrow Agent hereby agrees to act as escrow agent and to hold,safeguard, and disburse the Escrow Fund pursuant to the t erms and conditions hereof.
3.2Tax Liability. Any tax liability attributable to the payment of any amountpayable to either party with respect to the Escrow Fund will be the responsibility of the Partyreceiving the distribution from the Escrow Fund. Buyer and Seller, jointly and severally, agreeto indemnify and hold the Escrow Agent harmless from and against any liability on account of
taxes to which the Escrow Agent may be or becomes subject in connection with, or that arisesout of, this Escrow Agreement, including costs and expenses (including reasonable legal andexperts’ fees and expenses), interest, and penalties, other than any taxes payable by the EscrowAgent due to the payment to it of the Escrow Agent fees as contemplated herein.
Section 4.Escrow Period and Distribution Upon Termination.
4.1The Escrow Fund will remain in existence from the date hereof until October 29,2007, unless terminated or extended as provided for hereunder.
4.2Unless Buyer provides a Buyer Non-Compliance Notice pursuant to Section 4.4,prior to the close of business on October 29, 2007, Escrow Agent shall distribute to Seller theEscrow Deposit (i.e., one hundred thousand dollars ($100,000)).
4.3Buyer may deliver to Escrow Agent at any time prior to October 29, 2007, writtenauthorization to distribute to Seller the Escrow Deposit (i.e., one hundred thousand dollars($100,000)), in which case Escrow Agent shall, as soon as reasonably possible after receipt ofsuch notice, distribute to Seller the Escrow Deposit (i.e., one hundred thousand dollars($100,000)).
4.4Buyer may, by written notice delivered to Escrow Agent and Seller on or beforethe close of business on October 29, 2007, direct the Escrow Agent to retain beyond such datethe Escrow Fund because, in Buyer’s reasonable judgment, the conditions set forth in Section1.5(b) of the Purchase Agreement have not been satisfied (a“Buyer Non-Compliance Notice”).In the event that Buyer delivers to Escrow Agent a Buyer Non-Compliance Notice, EscrowAgent shall deliver to Buyer all funds in the Escrow Fund on the fifteenth (15th) day after receiptof such Buyer Non-Compliance Notice, unless Seller shall provide written notice to EscrowAgent and Buyer that it disputes in good faith the Buyer Non-Compliance Notice (a“DisputeNotice”). If Seller gives such a Dispute Notice, Escrow Agent will not transfer, deliver, orassign to Buyer any of the Escrow Funds under thisSection 4.4 until either(a) it receives thewritten consent of Seller or(b) there is a final decision underSection 5 and Escrow Agentreceives the written notice of such decision, including directions as to the disposition of theEscrow Fund, underSection 5.
4.5In no event shall Seller be entitled to more than the Escrow Deposit (i.e., onehundred thousand dollars ($100,000)). Any amounts in the Escrow Fund in excess of EscrowDeposit shall be delivered to Buyer at the same time that the Escrow Deposit is distributed toSeller.
Section 5.Dispute Resolution.All disputes arising under this Agreement(“Disputes”) will be resolved in accordance with the procedures set forth inSection 8.11 hereof.Upon resolution of a Dispute under suchSection 8.11, Buyer and Seller will cause the writtendetermination of the resolution contemplated by such section to be delivered to Escrow Agentpromptly.
Section 6.Investment of Escrow Deposit.Escrow Agent will invest the EscrowDeposit in the STI Classic US Treasury Money Market Fund.
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Section 7.Escrow Agent’s Provisions.
7.1Limitation on Escrow Agent’s Liability.In performing any of its duties underthis Agreement, Escrow Agent will not be liable to any Party for damages, except in the event ofgross negligence or willful misconduct on Escrow Agent’s part. Escrow Agent will not incurany liability for (a) any act or failure to act made or omitted in good faith or (b) any action takenor omitted in reliance upon any instrument, including any written statement or affidavit providedfor in this Escrow Agreement, that Escrow Agent in good faith believes to be genuine, nor willEscrow Agent be liable or responsible for forgeries, fraud, impersonations, or determining thescope of any agen t’s authority. In addition, Escrow Agent may consult with legal counsel inconnection with its duties under this Agreement and will be fully protected in any act taken,suffered, or permitted by it in good faith in accordance with the advice of counsel. EscrowAgent is not responsible for determining and verifying the authority of any person acting orpurporting to act on behalf of any Party.
7.2Indemnification of Escrow Agent.Buyer and Seller, and their respectivesuccessors and assigns, agree jointly and severally to indemnify and hold Escrow Agent harmlessagainst any and all losses, claims, damages, liabilities, and expenses, including reasonable costsof investigation and counsel fees (including allocated costs of in-house counsel) anddisbursements, that may be imposed on Escrow Agent or incurred by Escrow Agent inconnection with the performance of its duties under this Agreement, including those arising fromany lawsuit, claim, or action initiated in connection with this Escrow Agreement or involving itssubject matter, but excluding those arising from Escrow Agent’ s willful default or grossnegligence.
7.3Right of Interpleader.Should any controversy arise involving the Parties or anyof them or any other person with respect to this Escrow Agreement or the Escrow Fund, orshould a substitute escrow agent fail to be designated as provided inSection 7.5below, or ifEscrow Agent should be in doubt as to what action to take, Escrow Agent will have the right, butnot the obligation, either to (a) withhold delivery of the Escrow Deposit until the controversy isresolved, the conflicting demands are withdrawn, or its doubt is resolved or (b) institute apetition for interpleader in any court of competent jurisdiction to determine the rights of Buyerand Seller. If the Escrow Agent is a party to any dispute, Escrow Agent will have the additionalright to refer such controversy to binding arbitration to be conducted in accordance withSections5 and 8.11. Escrow Agent is also authorized to deposit with the clerk of the court all documentsand Escrow Deposit held in escrow. Upon initiating such action, Escrow Agent will be fullyreleased and discharged of and from all obligations and liability imposed by this Agreement.
7.4Escrow Agent Fees.Reasonable fees and expenses for the services EscrowAgent renders pursuant to this Agreement (including reasonable fees and disbursements of itscounsel incurred in connection with its performance of such services) will be paid to EscrowAgent. Seller will pay such fees and expenses. Escrow Agent’s fee schedule is set forth onExhibit A.
7.5Successor Escrow Agent.The Escrow Agent, or any successor to it hereafterappointed, may at any time resign by giving thirty (30) days notice in writing to Buyer and Sellerand will be discharged of its duties hereunder upon the appointment of a successor Escrow Agent
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as hereinafter provided. Upon any such resignation, Buyer and Seller will appoint a successor Escrow Agent, which will be a bank or trust company organized under the laws of the UnitedStates of America or any state thereof and having a combined capital and surplus of not less thanUS$1 billion. Any such successor Escrow Agent will deliver to Buyer and Seller a writteninstrument accepting such appointment hereunder, and thereupon it will succeed to all the rightsand duties of Escrow Agent hereunder and will be entitled to receive the Escrow Fund.
Section 8.Miscellaneous.
8.1Assignment; Successors and Assigns. This Agreement shall not beassignable by any Party without the prior written consent of the others. This Agreement shall bebinding upon the Parties and their respective successors, assigns, heirs, transferees, executors,and administrators.
8.2Cumulative Remedies.Each right, power, and remedy of any Partyprovided for in this Agreement or now or hereafter existing at law or in equity or by statute orotherwise shall be distinct, cumulative, and concurrent, and shall be in addition to every othersuch right, power, or remedy. The exercise or beginning of the exercise by any Party of any oneor more of the rights, powers, or remedies provided for in this Agreement or now or hereafterexisting at law or in equity or by statute or otherwise shall not preclude the simultaneous or laterexercise by such Party of all such other rights, powers or remedies, and no failure or delay on thepart of such Party to exercise any such ri ght, power or remedy shall operate as a waiver thereof.
8.3Further Assurances.The provisions of this Agreement shall be self-operative and shall not require further agreement by the Parties except as may be hereinspecifically provided to the contrary; provided, however, at the reasonable request of any Party,the other Parties shall execute such additional instruments and take such additional acts as therequesting Party may deem necessary to effectuate this Agreement.
8.4Notice.Whenever notice must be given under the provisions of thisAgreement, such notice must be in writing and addressed to the Parties at their respectiveaddresses set forth below and shall be deemed to have been duly given if delivered by(a) hand-delivery (with written confirmation of receipt);(b) facsimile (with written confirmation ofreceipt), provided that a copy is delivered by one of the other methods authorized in this Section;or(c) by commercial overnight delivery service, as follows:
| If to Seller: | | ProxyMed, Inc. |
| | | 1854 Shackleford Court |
| | | Suite 200 | | | | |
| | | Norcross, GA |
| | | Attention: General Counsel |
| | | Telephone: (404)770-4803 |
| | | Facsimile: (404)877-3385 |
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| If to Buyer: | | SureScripts, LLC |
| | | 5971 Kingstowne Village Parkway |
| | | Suite 200 |
| | | Alexandria, VA 22315 |
| | | Attention: Paul L. Uhrig, Esq. |
| | | Phone: (703) 921-2179 |
| | | Facsimile: (703) 921-2161 |
| If to Escrow Agent: | | | | |
| | | |
| | | SunTrust Bank |
| | | Corporate Agency Services |
| | 919 East Main Street, 10thFloor |
| | Richmond, VA 23219 |
| | Attn: Emily J. Hare |
| | Telephone: (804)782-5400 |
| | Facsimile: (804)782-7855 |
Notices shall be deemed given upon the earliest to occur of(i) receipt by the Party to whom suchnotice is directed, if hand delivered;(ii)if sent by facsimile machine, on the day (other than aSaturday, Sunday, or legal holiday in the jurisdiction to which such notice is directed) suchnotice is sent if sent (as evidenced by the facsimile confirmed receipt) prior to 5:00 p.m. EasternTime and, if sent after 5:00 p.m. Eastern Time, on the day (other than a Saturday, Sunday, orlegal holiday in the jurisdiction to which such notice is directed) after which such notice is sent;or(iii) on the first business day (other than a Saturday, Sunday, or legal holiday in thejurisdiction to which such notice is directed) following the day the same is deposited with thecommercial carrier if sent by commercial overnight delivery service. Any Party, by notice dulygiven in accordance therewith to the other Parties hereto may specify a different address for thegiving of any notice hereunder.
8.5Severability. If any one or more of the provisions of this Agreementshould be ruled wholly or partly invalid or unenforceable by a court or other government body ofcompetent jurisdiction, then: (i) the validity and enforceability of all provisions of thisAgreement not ruled to be invalid or unenforceable shall be unaffected; (ii) the effect of theruling shall be limited to the jurisdiction of the court or other government body making theruling; (iii) the provision(s) held wholly or partly invalid or unenforceable shall be deemedamended, and the court or other government body is authorized to reform the provision(s), to theminimum extent necessary to render them valid and enfo rceable in conformity with the Parties’intent as manifested herein and a provision having a similar economic effect shall be substituted;and (iv) if the ruling and/or the controlling principle of law or equity leading to the ruling, issubsequently overruled, modified or amended by legislative, judicial or administrative action, theprovision(s) in question as originally set forth in this Agreement shall be deemed valid andenforceable to the maximum extent permitted by the new controlling principle of law or equity.
8.6Amendment.No modification, waiver, amendment, discharge, or changeof this Agreement shall be valid unless in writing and signed by the Party or Parties againstwhom enforcement of such modification, waiver, amendment, discharge, or change is sought.
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8.7Choice of Law.The construction, interpretation, and enforcement of thisAgreement shall at all times and in all respects be governed by the laws of the Commonwealth ofVirginia, without reference to Virginia’s choice of law or conflict of law provisions or principles.
8.8Counterparts. This Agreement may be executed in one or morecounterparts, each of which shall be deemed an original, but all of which collectively shallconstitute one and the same agreement.
8.9Waiver. The waiver by any Party of a breach or violation of anyprovision of this Agreement shall not operate or be construed as a waiver of any subsequentbreach of such provision or any other provision of this Agreement.
8.10Headings; Gender; Number. The headings in this Agreement areintended solely for convenience of reference and shall be given no effect in the construction orinterpretation of this Agreement. All words used in this Agreement shall be construed to be ofsuch gender and number as the circumstances require.
8.11Arbitration.In the event of a dispute among any of the Parties arisingfrom or relating to this Agreement, including, but not limited to, construction, interpretation,implementation, or enforcement of this Agreement or the validity, performance, or breach of anyprovision in this Agreement, the applicable Parties shall meet and confer in good faith to resolvesuch dispute. In the event such efforts do not resolve the dispute within fifteen (15) days fromthe date the of receipt by a Party of written notice of a dispute, a Party may demand arbitrationby the American Arbitration Association (“AAA”), under its Commercial Arbitration Rules th enin effect, such arbitration to be final, conclusive, and binding. Judgment on the award renderedby the arbitrators may be entered by any court having jurisdiction. There shall be three (3)neutral and impartial arbitrators, of whom Seller shall appoint one and Buyer shall appointanother, both within thirty (30) days of the receipt by the respondent of the demand forarbitration. The two arbitrators so appointed shall select the third arbitrator, who shall serve asthe chair of the arbitral tribunal, within thirty (30) days of the appointment of the secondarbitrator. If any arbitrator is not appointed within the time limit provided herein, such arbitratorshall be appointed by the AAA in accordance with the listing, striking, and ranking procedure inthe rules of the AAA. Any arbitrator appo inted by the AAA shall be a retired judge or apracticing attorney with no less than fifteen years of experience with large commercial cases andan experienced arbitrator. The arbitrators shall base their award on the terms of this Agreement,and they will follow the law of the Commonwealth of Virginia. The arbitral tribunal is notempowered to award damages in excess of compensatory damages, and the Parties herebyirrevocably waive any right to recover punitive, exemplary or similar damages with respect toany dispute. The arbitrators shall render the award in writing and, unless the Parties agreeotherwise, shall include an explanation of the reasons for the award and the findings of fact andconclusions of law upon which the award is based. Notwithstanding the foregoing, by agreeingto arbitra tion, the Parties do not intend to deprive any court of its jurisdiction to issue a pre-arbitral injunction, pre-arbitral attachment, or other order in aid of arbitration proceedings andthe enforcement of any award. Without prejudice to such provisional remedies as may beavailable under the jurisdiction of a court, the arbitrators shall have full authority to grantprovisional remedies and to direct the Parties to request that any court modify or vacate any
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temporary or preliminary relief issued by such court, and to award damages for the failure of theParties to respect the arbitrators' orders to that effect.
8.12Attorney’s Fees. In the event that any Party breaches any of itsobligations pursuant to this Agreement, the non-breaching Party(ies) shall be entitled to recoverfrom the breaching Party(ies), in addition to any and all other remedies, its reasonable attorney’sfees, expenses, and costs which it incurs in enforcing its rights hereunder.
8.13Construction. This Agreement shall not be construed more strictlyagainst any Party hereto merely by the virtue of the fact that the Agreement may have beendrafted or prepared by such party or its counsel, it being recognized that each of the Partieshereto have contributed substantially and materially to its preparation and that this Agreementhas been the subject of negotiations between the Parties and as a product of that negotiation.
8.14Entire Agreement.This Agreement supersedes all prior agreementsbetween the Parties with respect to its subject matter and constitutes (along with the schedules,attachments, exhibits, and/or other documents referred to in this Agreement) a complete andexclusive statement of the terms of the agreement between the parties with respect to its subjectmatter. All schedules and exhibits attached hereto are part of the Agreement and are fullyincorporated herein with the same effect as if such schedules and exhibits were restated in theirentirety in the body of the Agreement.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the datefirst above written.
| SURESCRIPTS, LLC |
| |
| /s/ Kevin Hutchinson__________________ |
| Signature |
| |
| Kevin Hutchinson____________________ |
| Print Name |
| |
| President & CEO_____________________ |
| Office or Title |
| |
| April 30, 2007_______________________ |
| Date |
| |
| PROXYMED, INC. |
| |
| /s/ Peter Fleming_____________________ |
| Signature |
| |
| Peter Fleming________________________ |
| Print Name |
| |
| General Counsel______________________ |
| Office or Title |
| |
| SUNTRUST BANK |
| |
| /s/ Emily J. Hare______________________ |
| Signature |
| |
| Emily J. Hare________________________ |
| Print Name |
| |
| Vice-President_______________________ |
| Office or Title |
| |
| April 30, 2007_______________________ |
| Date |
EXHIBIT A
Escrow Agent’s Fee Schedule
| Escrow Administration Fee | | $1,500.00* |
* This fee is based on the investment of Escrow Funds in the STI Classic US Treasury MoneyMarket Fund.
