EXHIBIT 10.16
EXECUTION VERSION
INDEMNIFICATION AND ESCROW AGREEMENT
THIS INDEMNIFICATION AND ESCROW AGREEMENT (this "Agreement") is made
and entered into as of this 28th day of September, 2004 by and among CCP
Worldwide, Inc., a Delaware corporation ("Parent"), Dyadic International, Inc.,
a Florida corporation (the "Company"), Mark Tompkins ("Tompkins"), Vitel
Ventures ("Vitel," and together with Tompkins referred to individually as a
"Stockholder" and collectively as "Stockholders"), and Jenkens & Gilchrist, a
Professional Corporation, as escrow agent (the "Escrow Agent").
RECITALS
A. CCP Acquisition Corp, a Florida corporation and wholly-owned
subsidiary of Parent (the "Acquisition"), Parent and the ----------- Company
have entered into an Agreement of Merger and Plan of Reorganization, dated as of
September 28, 2004 (the "Merger Agreement"), whereby Acquisition will be merged
with and into the Company (the "Merger").
B. If the Merger is consummated, Stockholder will receive substantial
benefits and value.
C. Stockholders intend to indemnify and hold harmless, on a
non-recourse basis, Parent, the Company and their respective officers,
directors, and employees and each person, if any, who controls such persons
within the meaning of the Securities Act and the Exchange Act against certain
Indemnified Losses (as hereinafter defined).
D. Vitel desires to escrow, or cause to be escrowed, with an escrow
agent 225,000 shares of Parent Common Stock, which are shares that are to be
issued to Vitel pursuant to the Merger in respect to Vitel's shares of common
stock in the Company, to secure Stockholders' obligations to indemnify the
Indemnified Parties (as hereinafter defined) against the Indemnified Losses.
E. As an accommodation to the other parties, and notwithstanding the
fact that the Escrow Agent is legal counsel to the Company, the other parties
have requested that the Escrow Agent also serve in the capacity of an escrow
agent in the performance of this Agreement.
F. By execution of this Agreement, the parties hereto desire to set
forth more specifically their rights and obligations with respect to the
indemnification and escrow obligations of Stockholders to the Indemnified
Parties.
G. Section 6.18 of the Merger Agreement requires Stockholders to
execute and deliver this Agreement to Parent and the Company.
NOW, THEREFORE, in consideration of the foregoing Recitals (which are
hereby incorporated into and made a part of this Agreement) and the mutual and
dependent covenants hereinafter set forth, the parties agree as follows:
1. Defined Terms. Capitalized terms used in this Agreement and not
otherwise defined shall have the meanings given them in the Merger Agreement, a
copy of which is attached hereto as Exhibit A.
2. Regulatory Indemnification Provisions. Stockholders, jointly and
severally, agree on a non-recourse basis (a) to indemnify and hold harmless
Parent, the Company and their respective officers, directors and employees, and
each person, if any, who controls such person within the meaning of the
Securities Act and the Exchange Act (collectively, the "Indemnified Parties"),
against any loss, claim, damage, liability or expense and/or actions in respect
thereof (collectively, the "Regulatory Indemnified Losses") arising from,
relating to or incurred under the Securities Act, the Exchange Act, any SEC
rule, other federal or state statutory law or regulation, the rules and
regulations of any self-regulatory organization (including without limitation,
the National Association of Securities Dealers or NASDAQ) or common law
(collectively, the "Applicable Laws") (including in settlement of any
litigation, investigation or administrative proceeding, if such settlement is
effected with the written consent of Stockholder, which consent shall not be
unreasonably withheld or delayed), insofar as such Regulatory Indemnified Losses
arise out of or are based upon any failure of Parent to have complied on or
before the Merger Effective Time with any of the Applicable Laws, including,
without limitation: (i) the failure of any registration, information or proxy
statement, report or other document filed by Parent with the SEC or any state
securities regulatory authority (each a "Filed Document") to be timely filed or
otherwise conform in all material respects to the requirements of the Applicable
Laws; or (ii) the inclusion in any Filed Document of any untrue statement of
material fact or the omission from any Filed Document of any material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they are made, not misleading; and
(b) to reimburse the Indemnified Parties for any legal and other expense
incurred by the Indemnified Parties in connection with investigating, defending,
settling, compromising or paying any such Regulatory Indemnified Loss. Without
limitation, the amount of any such Regulatory Indemnified Loss shall include
Parent's expenses, including its legal and accounting fees, incurred with
respect to (i) any amendment of any Filed Document, including responding to SEC
comments or the comments of any state securities regulatory authority related to
any Filed Documents, and\or (ii) the performance of any additional services
relating to the preparation of and\or amendment of any registration, information
or proxy statement, report or other document filed by Parent with the
Commission, any state securities regulatory authority, and/or NASDAQ following
the Merger Effective Time, including without limitation, Parent's registration
statement under the Exchange Act and its reports on Form 8-K reporting the
Merger, the Merger Agreement and related transactions, made necessary or
advisable as a result of deficiencies in the Filed Documents or any other
failure of Parent to have complied with Applicable Laws prior to the Merger
Effective Time. For avoidance of any doubt, no additional services referred to
in the immediately preceding sentence shall be deemed to have been performed
with respect to the preparation of Parent's reports on Form 8-K reporting the
Merger, the Merger Agreement and related transactions in the absence of any
deficiencies in the Filed Documents or any other failure of Parent to have
complied with Applicable Laws prior to the Merger Effective Time.
3. Breaches of Agreements by Parent and Affiliates. Stockholders,
jointly and severally, agree on a nonrecourse basis (a) to indemnify and hold
harmless the Indemnified Parties against any loss, claim, damage, liability or
expense and/or actions in respect thereof (collectively, the "Agreement
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Indemnified Losses") arising from, relating to or incurred as a result of (i)
any breach by Parent on or before the Merger Effective Time of any
representation, warranty or covenant of Parent contained in the Merger Agreement
or (ii) any breach by David R. Allison ("Allison") or Custom Craft Packaging,
Inc., a North Carolina corporation ("Custom Craft"), of any of their respective
representations, warranties or covenants contained in that certain Split-Off
Agreement dated as of September 28, 2004 (the "Split-Off Agreement"), between
Parent, the Company, Custom Craft and Allison; and (b) to reimburse the
Indemnified Parties for any legal and other expense incurred by the Indemnified
Parties in connection with investigating, defending, settling, compromising or
paying any such Agreement Indemnified Loss. Stockholders acknowledge that the
representations, warranties and covenants of Parent contained in the Merger
Agreement survive beyond the Merger Effective Time, as provided in Section 8 of
the Merger Agreement.
4. Additional Indemnification Provisions. Stockholders, jointly and
severally, shall also (a) indemnify and hold harmless the Indemnified Parties
against any loss, claim, damage, liability or expense and/or actions in respect
thereof (collectively, the "Additional Indemnification Losses") (including in
settlement of any litigation, investigation or administrative proceeding, if
such settlement is effected with the written consent of Stockholder, which
consent shall not be unreasonably withheld or delayed) insofar as such
Additional Indemnification Losses arise out of, relate to or are based upon (i)
any liability or obligation of Parent for any federal, state or local taxes as a
result of the Split-Off, (ii) the failure of Parent to have more than three
hundred (300) round lot holders (as computed in accordance with the rules of the
NASDAQ Stock Market), without counting the stockholders and investors in the
Company existing as of the date of this Agreement, by the ninetieth (90th)
Business Day following the Merger Effective Time, or (iii) any violations of
federal or state securities laws attributable to any past or future purchases or
sales by either of Stockholders of Parent Common Stock, or any derivative
securities thereof; and (b) reimburse the Indemnified Parties for any legal and
other expense incurred by the Indemnified Parties in connection with
investigating, defending, settling, compromising or paying any such Additional
Indemnified Loss.
5. Escrow Deposit. Simultaneously with the execution of this
Agreement, Vitel has deposited, or cause to be deposited, --------------- with
the Escrow Agent 225,000 shares of Parent Common Stock (or 225,000 shares of the
Company's common stock to be exchanged for Parent Common Stock as a result of
the Merger) (the "Escrow Shares"), which will be available to satisfy any
amounts owed to any of the Indemnified Parties with respect to Regulatory
Indemnified Losses, Agreement Indemnified Losses and/or Additional Indemnified
Losses (collectively, the "Indemnified Losses"). Vitel shall endorse over the
certificates representing the Escrow Shares to the Escrow Agent, and Vitel,
Parent and Escrow Agent shall cause the Escrow Shares to be registered in Escrow
Agent's name under the style "Jenkens & Gilchrist, a Professional Corporation,"
as Escrow Agent" with Parent's transfer agent and registrar for the Parent
Common Stock. The Escrow Agent shall take physical possession of certificates
representing the Escrow Shares registered in its name as aforesaid and hold such
certificates representing the Escrow Shares in an "Escrow Account" subject to
and in accordance with this Agreement. If Vitel deposits Company Common Stock
instead of Parent Common Stock, Vitel will cooperate to effect the exchange of
each Company Common Stock for Parent Common Stock in accordance with the terms
of the Merger.
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6. Administration of Escrow Account. The Escrow Agent shall
administer the Escrow Account and Escrow Shares as follows:
(a) If an Indemnified Party has incurred or suffered an
Indemnified Loss for which, based on its good faith belief, such Person is
entitled to be indemnified by the Stockholders pursuant to the terms of this
Agreement (the "Claim"), it may request the release of some or all of the Escrow
Shares by giving written notice of its Claim in accordance with the provisions
of Section 12 hereof (the "Claim Notice") to the Escrow Agent and the other
parties hereto prior to or on the Termination Date (as hereinafter defined),
describing in such notice the amount of the claimed Indemnified Losses and a
reasonable description of the basis for such Claim; provided, however, that a
Claim Notice shall be deemed to be sufficient and properly made even if at the
time of the giving of the Claim Notice the amount of the Claim has not been
determined, is not known or can only be described in general terms so long as
the Claim Notice so states and in such event, the Claim shall be deemed to be an
Open Claim (as hereinafter defined) and the Escrow Agent shall reserve all
Escrow Shares remaining in the Escrow Account (plus all dividends received on
the Escrow Shares, which shall constitute part of the Escrow Account), which
shall be deemed a Claim Reserve (as hereinafter defined) until a subsequent
Claim Notice relating to the original Claim Notice that contains a specific
amount is delivered to the Escrow Agent and at that time Stockholders may make a
written objection to such Claim pursuant to Section 6(c) hereof. The one (1)
year anniversary of the consummation of the Merger shall be referred to herein
as the "Termination Date."
(b) If the Escrow Agent has not received written objection
to a Claim by an Indemnified Party from Stockholders within thirty (30) days
after delivery to the Escrow Agent and Stockholders of the Claim Notice with
respect to such Claim from such Indemnified Party, the Claim stated in such
notice shall be conclusively deemed to be approved by Stockholders, and the
Escrow Agent shall on the second (2nd) banking day thereafter issue to the
applicable Indemnified Party the number of Escrow Shares from the Escrow Account
having a Value (as hereinafter defined) equal to the amount of the Claim.
(c) If within such thirty (30) days the Escrow Agent shall
have received from Stockholders a written objection to any Claim or any portion
of a Claim made by an Indemnified Party, reasonably specifying the nature of and
grounds for such objection (a copy of which shall in each case be sent to such
Indemnified Party in accordance with the provisions of Section 12 below), then
such Claim or such portion of the Claim shall be deemed to be an "Open Claim"
and the Escrow Agent shall reserve within the Escrow Account the number of
Escrow Shares having a Value equal to the amount of the Open Claim (which amount
for each Open Claim is referred to herein as a "Claim Reserve"). Any portion of
the Claim that Stockholders have not specifically objected to pursuant to this
subsection shall be deemed to be approved by Stockholders, and the Escrow Agent
shall on the second (2nd) banking day after expiration of such thirty (30) day
period release to such Indemnified Parties from the Escrow Account the number of
Escrow Shares having a Value equal to the portion of the Claim not objected to
pursuant to this Section. Notwithstanding the foregoing, Stockholders may object
to a Claim or a portion of a Claim pursuant to this Section 6 only based upon a
good faith belief that all or any portion of the Claim does not constitute
Indemnified Losses for which such Indemnified Parties are entitled to
indemnification under this Agreement or that the amount of any Claim is
overstated.
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(d) The amount constituting the Claim Reserve for each
Open Claim shall be paid by the Escrow Agent from the Escrow Account to such
Indemnified Parties only in accordance and consistent with (i) a joint written
instruction by such Indemnified Parties and Stockholders (a "Joint Instruction")
or (ii) a final non-appealable order of a court of competent jurisdiction (a
"Final Determination"). The Escrow Agent shall act on a Joint Instruction or a
Final Determination without further question. Any portion of an Open Claim not
payable to the Indemnified Parties shall be no longer subject to the Claim
Reserve and shall remain part of the Escrow Account.
(e) For purposes of this Agreement, the "Value" of each of
the Escrow Shares shall be $3.33 per share.
(f) In connection with the performance of this Agreement
each of the parties expressly acknowledges and agrees that the Escrow Agent is
not providing legal services in connection with its escrow services rendered
under this Agreement but that, for other matters, Escrow Agent is legal counsel
to the Company, and following the consummation of the Merger, will be legal
counsel to Parent, and therefore agrees that in no event shall the mere fact
that the Escrow Agent is serving as the escrow agent hereunder give rise to any
conflict of interest or other grounds by which the Company, or subsequent to the
Merger, the Parent, shall be deprived of the benefit of the Escrow Agent's legal
counsel, provided that if there shall arise any dispute between any of the
parties hereto in connection with the performance of this Agreement, the Escrow
Agent shall resign its position as Escrow Agent hereunder in favor of a new
escrow agent mutually agreed to by the other parties hereto.
7. Deliveries from Escrow. The Escrow Agent shall hold the Escrow
Shares in escrow in accordance with this Agreement and shall make deliveries of
Escrow Shares only as follows:
(a) Deliveries shall be made to an Indemnified Party for
Claims made by such Indemnified Party under this Agreement with respect to the
Escrow Account when, and to the extent, authorized under Section 6 above.
(b) Promptly after the six (6) month anniversary of the
consummation of the Merger (the "6-Month Anniversary"), the Escrow Agent shall
deliver to Vitel 75,075 of the Escrow Shares then held in the Escrow Account;
provided, however, if the aggregate amounts of any and all Claim Reserves as of
the 6-Month Anniversary exceed $500,000, the number of Escrow Shares to be
delivered under this paragraph (b) by the Escrow Agent to Vitel shall be reduced
by the number equal to (i) the excess of the aggregate amounts of any and all
Claim Reserves as the 6-Month Anniversary over $500,000 divided by (ii) $3.33.
(c) Promptly after the Termination Date, the Escrow Agent
shall deliver to Vitel all of the remaining Escrow Shares then held in the
Escrow Account less the number of Escrow Shares having a Value equal to the
aggregate amounts of any and all Claim Reserves as of the Termination Date.
After the Termination Date, the number of Escrow Shares constituting the Claim
Reserve for each Open Claim shall be delivered by the Escrow Agent from the
Escrow Account to an Indemnified Party or Vitel upon a Joint Instruction or a
Final Determination with respect to such Open Claim.
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(d) Notwithstanding any other provision of this Agreement,
all deliveries made to an Indemnified Party or Vitel under this Agreement shall
be made to the primary address for notices for that Person set forth in Section
12 hereof, unless the Escrow Agent receives other written delivery instructions
from such Person.
(e) All deliveries to any Person under this Agreement of
Escrow Shares shall be effected by transfers from the Escrow Agent of registered
ownership of the required number of Escrow Shares using stock powers and
physical delivery and reissuance of certificates representing the Escrow Shares
to be delivered by the Escrow Agent with the assistance of the transfer agent
and registrar for the Parent Common Stock. Parent shall cooperate, and shall
instruct its transfer agent and registrar to cooperate, in any efforts by the
Escrow Agent to effect a delivery of Escrow Shares through a transfer of
registration of certificates representing such Escrow Shares in favor of any
Person.
(f) This Agreement shall terminate when the entire Escrow
Account has been delivered in accordance with this Section 7.
8. Conditions to Escrow. The Escrow Agent agrees to hold the Escrow
Account and to perform in accordance with the terms and provisions of this
Agreement. The parties hereto agree that the Escrow Agent does not assume any
responsibility for the failure of any of the parties hereto to perform in
accordance with the Merger Agreement or this Agreement. The acceptance by the
Escrow Agent of its responsibilities hereunder is subject to the following terms
and conditions, which the parties hereto agree shall govern and control with
respect to the Escrow Agent's rights, duties, liabilities and immunities:
(a) The Escrow Agent shall be protected in acting upon any
written notice, consent, receipt or other paper or document furnished to it, not
only as to its due execution and validity and effectiveness of its provisions,
but also as to the truth and accuracy of any information therein contained,
which the Escrow Agent in good faith believes to be genuine and what it purports
to be. Should it be necessary for the Escrow Agent to act upon any instructions,
directions, documents or instruments issued or signed by or on behalf of any
corporation, fiduciary, or individual acting on behalf of another party hereto,
it shall not be necessary for the Escrow Agent to inquire into such
corporation's, fiduciary's or individual's authority. The Escrow Agent is also
relieved from the necessity of satisfying itself as to the authority of the
persons executing this Agreement in a representative capacity.
(b) The Escrow Agent shall not be liable for any error of
judgment or for any act done or step taken or omitted by it in good faith, or
for any mistake of fact or law, or for anything which it may do or refrain from
doing in connection herewith, except for its own gross negligence, recklessness
or willful misconduct.
(c) The Escrow Agent may consult with, and obtain advice
from, legal counsel in the event of any question as to any of the provisions
hereof or the duties hereunder, and it shall incur no liability and shall be
fully protected in acting in good faith in accordance with the opinion and
instructions of such counsel. The reasonable costs of such counsel's services
shall be paid to the Escrow Agent in accordance with Section 11 below.
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(d) The Escrow Agent shall have no duties except those
which are expressly set forth herein and it shall not be bound by the Merger
Agreement or any agreement of the other parties hereto (whether or not it has
any knowledge thereof) or by any notice of a claim, or demand with respect
thereto, or any waiver, modification, amendment, termination or rescission of
this Agreement, until received by an officer in its Corporate Trust Department
in writing.
(e) The Escrow Agent reserves the right to resign at any
time by giving thirty (30) days written notice of resignation, specifying the
effective date thereof. Within thirty (30) days after receiving the aforesaid
notice, the parties to this Agreement, other than the Escrow Agent, agree to
appoint a successor Escrow Agent to which the Escrow Agent may distribute the
property then held hereunder, less the Escrow Agent's fees, costs and expenses.
If a successor Escrow Agent has not been appointed and has not accepted such
appointment by the end of the 30-day period, the Escrow Agent may apply to a
court of competent jurisdiction for the appointment of a successor Escrow Agent,
and the costs, expenses and reasonable attorneys' fees which are incurred in
connection with such a proceeding shall be paid by the parties to this
Agreement.
(f) Upon delivery of all of the Escrow Account pursuant to
the terms of Section 6 or 7 above or to a successor escrow agent, the Escrow
Agent shall thereafter be discharged from any further obligations hereunder. The
Escrow Agent is hereby authorized, in any and all events, to comply with and
obey any and all final judgments, orders and decrees of any court of competent
jurisdiction which may be filed, entered or issued, and all final arbitration
awards and, if it shall so comply or obey, it shall not be liable to any other
person by reason of such compliance or obedience.
(g) In the event that any escrow property shall be
attached, garnished, or levied upon by any court order, or the delivery thereof
shall be stayed or enjoined by an order of a court, or any order, judgment or
decree shall be made or entered by any court order affecting the property
deposited under this Agreement, or any part thereof, the Escrow Agent is hereby
expressly authorized, in its sole discretion, to obey and comply with all writs,
orders or decrees so entered or issued, which it is advised by legal counsel of
its own choosing is binding upon it, whether with or without jurisdiction, and
in the event that the Escrow Agent obeys or complies with any such writ, order,
judgment or decree, it shall not be liable to any of the parties hereto or to
any other person, firm or corporation, by reason of such compliance
notwithstanding that such writ, order, judgment or decree is subsequently
reversed, modified, annulled, set aside or vacated.
(h) If the Escrow Agent becomes involved in litigation on
account of this Agreement, it shall have the right to retain counsel and shall
have a first lien on the property deposited hereunder for any and all costs,
attorneys' fees, charges, disbursements, and expenses in connection with such
litigation; and shall be entitled to reimburse itself therefor out of the
property deposited hereunder, and if it shall be unable to reimburse itself from
the property deposited hereunder, both parties agree to pay to the Escrow Agent
on demand its reasonable charges, counsel and attorneys' fees, disbursements and
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expenses in connection with such litigation in accordance with the terms of
Section 11 below. Notwithstanding the foregoing sentence, the Escrow Agent shall
not be entitled to take from the property deposited hereunder nor be entitled to
receive moneys from the parties in the event such litigation finally determines
that the Escrow Agent acted with gross negligence, recklessness or willful
misconduct.
(i) In the event that conflicting demands are made upon
the Escrow Agent for any situation not addressed in this Agreement, the Escrow
Agent may withhold performance of the terms of this Agreement until such time as
said conflicting demands shall have been withdrawn or the rights of the
respective parties shall have been settled by court adjudication, arbitration,
joint order or otherwise.
(j) Any corporation or association into which the Escrow
Agent may be converted or merged, or with which it may be consolidated, or to
which it may sell or transfer its corporate trust business and assets as a whole
or substantially as a whole, or any corporation or association resulting from
any such conversion, sale, merger, consolidation or transfer to which it is a
party, shall be and become the successor Escrow Agent hereunder and vested with
all of the title to the whole property or trust estate and all of the trusts,
powers, immunities, privileges, protections and all other matters as was its
predecessor, without the execution or filing of any instrument or any further
act, deed or conveyance on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.
9. Indemnification. Stockholders, Parent and the Company, jointly and
severally, hereby agree to indemnify the Escrow Agent for and to hold it
harmless against any loss, liability or expense incurred without gross
negligence, recklessness or willful misconduct on the part of the Escrow Agent
arising out of or in connection with its performance under this Agreement. The
indemnification provided for under this Section 9 shall be allocated and paid in
the same manner as fees, costs and expenses under Section 11 below and shall
survive the termination of this Agreement and the resignation or removal of the
Escrow Agent.
10. Banking Days. If any date on which the Escrow Agent is required
to make a delivery pursuant to the provisions hereof is not a day on which the
Escrow Agent is open for business, then the Escrow Agent shall make such
delivery on the next succeeding business day.
11. Escrow Costs. Parent and Stockholders shall each pay one-half of
the reasonable fees and expenses (including reasonable attorneys' fees) of the
Escrow Agent for the services to be rendered by the Escrow Agent pursuant to
this Agreement. The Escrow Agent may deduct the fees and expenses allocated to
each of the parties hereto from any cash amounts to be paid to such party from
the Escrow Account. The Escrow Agent agrees to serve as Escrow Agent in
accordance with the fee schedule attached as Exhibit B hereto. The Escrow Agent
shall have, and is hereby granted, a prior lien upon any property, cash, or
assets of the Escrow Account, with respect to its unpaid fees, nonreimbursed
expenses and unsatisfied indemnification rights, superior to the interests of
any other persons or entities. The Escrow Agent shall be entitled and is hereby
granted the right to set off and deduct any unpaid fees, nonreimbursed expenses
and/or unsatisfied indemnification rights from property on deposit in the Escrow
Account.
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12. Notices. All notices, instructions, demands, consents, approvals
and other communications to be given or delivered under or by reasons of the
provisions of this Agreement shall be in writing and shall be deemed to have
been given when personally delivered or received by certified mail, return
receipt requested, or guaranteed overnight courier service. Notices,
instructions, demands, consents, approvals and other communications to the
parties will be sent to the addresses indicated below:
Notices to the Stockholders:
Vitel Ventures
Mark Tompkins
802 Grand Pavilion, 1st Floor
P.O. Box 30543 SMB
Grand Cayman
Cayman Islands, BWI
With a copy to:
Gottbetter & Partners
488 Madison Avenue, 12th Floor
New York, New York 10022
Attention: Adam S. Gottbetter, Esq.
Notices to Company:
Dyadic International, Inc.
140 Intracoastal Pointe Dr., Suite 404
Jupiter, Florida 33477-5094
Attention: Mr. Mark Emalfarb, CEO
With a copy to:
Jenkens & Gilchrist, P.C.
225 West Washington, Suite 2600
Chicago, Illinois 60606
Attention: Robert I. Schwimmer, Esq.
Notice to Parent:
(prior to completion of the Merger)
CCP Worldwide, Inc.
6040A Six Forks Road, Suite 179
Raleigh, North Carolina 27609
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(after completion of the Merger)
Dyadic International, Inc.
140 Intracoastal Pointe Dr., Suite 404
Jupiter, Florida 33477-5094
Attention: Mr. Mark Emalfarb, CEO
With a copy to:
(prior to the completion of the Merger)
Gottbetter & Partners
488 Madison Avenue, 12th Floor
New York, New York 10022
Attention: Adam S. Gottbetter, Esq.
(after completion of the Merger)
Jenkens & Gilchrist, P.C.
225 West Washington, Suite 2600
Chicago, Illinois 60606
Attention: Robert I. Schwimmer, Esq.
Notices to Escrow Agent:
Jenkens & Gilcrhist
225 West Washington, Suite 2600
Chicago, Illinois 60606
Attention: Robert I. Schwimmer, Esq.
Each of the parties may, by notice given as aforesaid, change its address for
all subsequent notices.
13. Reports of Escrow Agent. On or before the tenth (10th) business
day following each March 31, June 30, September 30 and December 31 during the
term hereof, the Escrow Agent shall deliver account statements to Parent and
Stockholders with respect to the Escrow Account for the prior fiscal quarter,
which statements shall include such information as the number of Escrow Shares
held by the Escrow Agent, any Open Claims and Claim Reserves and any Escrow
Shares delivered during the fiscal quarter.
14. Entire Agreement; Amendment. This Agreement contains the entire
understanding of the parties hereto with respect to the transactions
contemplated hereby, and this Agreement may be amended, modified, supplemented
or altered only by a writing duly executed by the Escrow Agent, Parent, the
Company and Stockholders.
15. Assigns and Assignment. This Agreement shall extend to, shall
insure to the benefit of and shall be binding upon all of the parties hereto and
upon all of their respective successors and permitted assigns. This Agreement
shall not, however, be assignable or transferable, in whole or in part, by
Stockholders, except upon the express prior written consent of Parent, the
Company and the Escrow Agent. No assignment of the interest of any of the
parties hereto shall be binding on the Escrow Agent unless and until written
evidence of assignment in form satisfactory to the Escrow Agent shall be filed
with and accepted by the Escrow Agent.
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16. Taxation of Interest Earned on Investment of Escrow Account.
Vitel hereby acknowledges that, for federal and state income tax purposes, any
dividends received on the Escrow Shares shall be income of Vitel reportable on
its individual tax returns whether or not the dividends were distributed by the
Escrow Agent during any particular year. Vitel shall provide the Escrow Agent
with a Form W-9 or W-8, as applicable. The Escrow Agent shall report to the
Internal Revenue Service all dividends received on the Escrow Shares against
Vitel, as and to the extent required by law. Any tax returns required to be
prepared and filed will be prepared and filed by Vitel with the Internal Revenue
Service, and Escrow Agent shall have no responsibility for the preparation
and/or filing of any tax return with respect to any dividends received on the
Escrow Shares. Any taxes payable with respect to any dividends received on the
Escrow Shares shall be paid by Vitel, and the Escrow Agent shall have no
obligation to pay any taxes or estimated taxes.
17. Interpretation. The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or control or affect
the meaning hereof. As used herein, a reference to "he" or "his" or like
masculine form shall be deemed to also be a reference to the relevant feminine
and indefinite forms. As used herein, a "Person" shall be deemed to be a
reference to an individual, partnership, corporation, unincorporated
association, trust, governmental agency (or division thereof) or any other legal
entity.
18. No Waiver. Except as otherwise set forth in this Agreement, no
failure or delay by a party hereto in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, and no single or partial exercise
thereof shall preclude any right of further exercise or the exercise of any
other right, power or privilege.
19. Severability. The parties agree that (a) the provisions of this
Agreement shall be severable in the event that for any reason whatsoever the
provisions hereof were invalid, void or otherwise unenforceable, (b) such
invalid, void or otherwise unenforceable provisions shall be automatically
replaced by other provisions which are as similar as possible in terms to such
invalid, void or otherwise unenforceable provisions but are valid and
enforceable and (c) the remaining provisions shall remain enforceable to the
fullest extent permitted by law.
20. Governing Law. This Agreement shall be governed by and construed
in accordance with the domestic laws of the State of Delaware without giving
effect to any choice of law or conflict of law provision (whether of the State
of Delaware or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Delaware.
21. Counterparts. This Agreement may be executed by the parties
hereto, in two or more counterparts, each of which shall be an original and all
of which shall together constitute one and the same agreement.
* * * * *
11
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on the date first written above.
CCP WORLDWIDE, INC.,
a Delaware corporation
By: /s/ David R. Allison
-----------------------------
Name: David R. Allison
Its: President & CEO
DYADIC INTERNATIONAL, INC.,
a Florida corporation
By: /s/ Mark Emalfarb
-----------------------------
Name: Mark Emalfarb
Its: President
/s/ Mark Tompkins
--------------------------------
Mark Tompkins
VITEL VENTURES
By: /s/ Mark Tompkins
-----------------------------
Name:
Its:
Jenkens & Gilchrist,
a Professional Corporation
By: /s/ Robert I. Schwimmer
-----------------------------
Name: Robert I. Schwimmer
Its: President
Exhibit B
ESCROW AGENT FEE SCHEDULE
Acceptance Fee: $ 0.00
Annual Fee: $ None while Jenkens & Gilchrist, a
Professional Corporation, is serving
as Escrow Agent
The Acceptance Fee and the Annual Fee are billed in advance and payable prior to
that year's service. These fees cover a full year, or any part thereof, and thus
are not prorated in the year of termination.
Any out-of-pocket expenses, or extraordinary fees or expenses such as attorney
fees or messenger costs, are additional and are not included in the above
schedule.