EXHIBIT 2.2
ESCROW AGREEMENT
THIS ESCROW AGREEMENT ("Escrow Agreement") is made as of June __, 2000 by
and among Mitel Corporation, a Canadian corporation ("Purchaser"), Hsien-Cheng
Chen, Alex Cilento and Den Suzuki as agents (each, a "Shareholder
Representative" and, collectively the "Shareholder Representatives") of the
former shareholders of Vertex Networks, Incorporated, a California corporation
(the "Company"), the persons and entities (the "Holders") listed on the Schedule
of Holders, attached hereto as Exhibit A, and US Bank Trust, National
Association (the "Escrow Holder"). Terms not otherwise defined herein shall have
the same meaning set forth in the Agreement (as defined below).
RECITALS
1. Pursuant to an Agreement and Plan of Reorganization and Merger (the
"Agreement"), dated as of June 6, 2000, by and among Purchaser, U.S. Acquisition
Corporation, a California corporation and wholly-owned subsidiary of Purchaser
("Acquisition Corp."), and the Company, Acquisition Corp. will be merged with
and into the Company and the Company will be the surviving corporation and
become a wholly-owned subsidiary of Purchaser (the "Merger").
2. This Escrow Agreement is being entered into pursuant to Section 2.4 and
Article IX of the Agreement, a copy of which is attached hereto as Exhibit A.
Execution and delivery of this Escrow Agreement is a condition to the obligation
of Purchaser to consummate the Merger.
3. Pursuant to this Escrow Agreement, the Holders of shares of capital
stock of the Company (exclusive of those Shareholders exercising their
dissenters' rights) hereby authorize the Shareholder Representatives to act as
their representatives under this Escrow Agreement with the powers and authority
provided herein.
4. Pursuant to the Agreement, the shares of the capital stock of the
Company that are outstanding immediately prior to the Effective Time, other than
Dissenting Shares, will be converted into shares of Purchaser Common Stock.
5. Section 2.4 of the Agreement provides that at the Effective Time,
certain of the shares of Purchaser Common Stock issued in the Merger shall be
delivered on behalf of the Holders to the Escrow Holder in order to secure the
indemnification obligations of the Holders set forth in Article IX of the
Agreement.
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NOW, THEREFORE, the parties hereto hereby agree as follows:
Article I
DEFINITIONS
For the purposes of this Escrow Agreement, the following terms shall have
the following meanings:
1.1 Claim Certificate. "Claim Certificate" shall mean a certificate
signed by an officer of Purchaser stating (i) that Purchaser has incurred or
reasonably believes it will in the future incur the amount of Losses specified
in such Claim Certificate, (ii) in reasonable detail, the facts alleged as the
basis for such claim and the section or sections of the Agreement alleged to
have been violated, and (iii) the number of Escrowed Shares to which Purchaser
believes it is entitled with respect to such Losses.
1.2 Escrow Fund. "Escrow Fund" shall mean the Escrowed Shares then
held by the Escrow Holder, plus any cash received pursuant to Section 3.4
hereof, but shall not include any normal, regular cash dividends paid with
respect to the Escrowed Shares which dividends shall be for the benefit of, and
distributed to, the Holders with respect to such Escrowed Shares.
1.3 Escrowed Share. An "Escrowed Share" shall mean a share of
Purchaser Common Stock delivered to the Escrow Holder by the Exchange Agent on
behalf of the Holders in accordance with Sections 2.4 and Section 2.6 of the
Agreement, together with any and all other shares of Purchaser Common Stock, or
other securities of Purchaser received or receivable in respect of such Escrowed
Share of Purchaser Common Stock, including, without limitation, any and all
securities, to be issued or distributed in connection with any recapitalization,
reclassification, split-up, merger, consolidation, exchange, stock dividend,
stock split or similar event declared or effected with respect to shares of
Purchaser Common Stock.
1.4 Termination Date. "Termination Date" shall mean the second
anniversary of the Effective Time, unless Purchaser and the Shareholder
Representatives provide written notice of early termination to the Escrow
Holder.
1.5 Value. "Value," as used herein, shall be determined by reference
to the Average Stock Price of Purchaser Common Stock, as set forth in Section
2.3 of the Agreement.
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Article II
AGREEMENT BY THE HOLDERS
2.1 Indemnification by the Holders. By virtue of the Holders
approval of the Merger, the Agreement and the transaction contemplated
thereunder, the Holders have agreed, and by executing this Escrow Agreement each
Holder hereby confirms that such Holder agrees, subject to the terms and
conditions of this Escrow Agreement and Article IX of the Agreement:
(a) To indemnify and hold harmless Purchaser, its directors,
officers, employees, fiduciaries, agents, Affiliates, and each person, if any,
who controls or may control such persons within the meaning of the 1933 Act (the
"Indemnified Parties") from and against any and all Losses to the extent
provided in Article IX of the Agreement;
(b) To establish the Escrow Fund pursuant to this Escrow
Agreement and Section 2.4 of the Agreement to secure the indemnification
obligations of the Holders under Article IX of the Agreement;
(c) Without limiting such Holder's obligations under paragraph
(a) above, that in the event the Indemnified Parties incur any Losses, the
Escrow Shares shall, subject to the provisions of the Agreement and this Escrow
Agreement, be transferred to the Indemnified Parties to compensate such parties
for such Losses, with the portion of the Escrow Shares to be so transferred to
be pro rata as to each Loss among the Holders according to each Holder's
proportionate share of the Escrow Shares;
(d) To appoint the Shareholder Representatives as the Holders'
representatives, attorneys-in-fact and agents for the purposes of this Escrow
Agreement to act for and on behalf of each Holder as provided herein, and to the
taking by the Shareholder Representatives of any and all actions and the making
of any decisions required or permitted to be taken or made by the Shareholder
Representatives on behalf of the Holders under this Escrow Agreement; and
(e) To all of the other terms and conditions of this Escrow
Agreement.
Article III
CREATION OF ESCROW
3.1 Purpose. This Escrow Agreement is being executed and delivered,
and the deposit of the Escrow Fund hereunder is being made in accordance
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with Section 2.4 of the Agreement, for the purpose of securing the
indemnification obligations of the Holders set forth in Article IX of the
Agreement.
3.2 Creation of Escrow Fund. At or promptly after the Effective
Time, the Shareholder Representatives shall instruct the Exchange Agent to
deposit with the Escrow Holder certificates representing those shares of
Purchaser Common Stock required to be so deposited pursuant to Section 2.4 of
the Agreement. Purchaser and the Holders agree that any other securities, which
thereafter are to become part of the Escrow Fund as provided in Section 1.3 of
this Escrow Agreement, shall be promptly deposited with the Escrow Holder upon
receipt by or on behalf of the Holders, and receipt by the Escrow Holder on
behalf of the Holders shall be deemed receipt by the Holders. Certificates
representing securities deposited in the Escrow Fund shall be accompanied by
separate stock powers endorsed in blank by the Shareholder Representatives on
behalf of the Holders.
3.3 No Transfer or Encumbrance. Except to the extent expressly
permitted by the provisions of this Section 3.3, no Escrow Shares or any
beneficial interest therein may be sold, assigned, pledged, encumbered or
otherwise transferred (including, without limitation, by operation of law, other
than a conversion of shares in a merger or consolidation) by any Holder or be
taken or reached by any legal or equitable process in satisfaction of any debt
or other liability of a Holder (other than such Holder's obligations under this
Escrow Agreement) prior to the delivery and release to the Holders of the Escrow
Shares by the Escrow Holder in accordance with the provisions of Article 4
hereof; provided, however, that any Holder may transfer its share of the Escrow
Shares hereunder so long as such transfer is by gift or upon death or permanent
incapacity to his or her guardian, conservator, executor, administrator,
trustees or beneficiaries under his or her will, spouse, children, stepchildren,
grandchildren, parents, siblings or legal dependents, to a trust of which the
beneficiary or beneficiaries of the corpus and the income shall be such a person
and all such persons agree to be bound by the terms hereof or to partners of a
Holder that is a partnership, provided that all of such partners agree to be
bound by the terms hereof.
3.4 Treatment of Escrow Shares. The Escrow Shares shall be held by
the Escrow Holder as a trust fund and shall not be subject to any lien,
attachment, trustee process or any other judicial process of any creditor of any
party hereto.
3.5 Power to Transfer Escrow Fund. The Escrow Holder is hereby
granted the power to effect any transfer of Escrow Shares permitted or required
by this Escrow Agreement in accordance with its terms.
3.6 Tax Reporting With Respect to Escrow Fund. All parties hereto
agree that for all income tax purposes (including any tax reporting obligations)
the Holders shall be treated as the owners of the Escrowed Shares transferred by
such Holder to the Escrow Fund until distributed from the Escrow Fund pursuant
to the terms of this Escrow Agreement. The Holders agree to report on their own
tax returns any income, gain or loss with respect to the Escrowed Shares held in
the Escrow Fund.
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Article IV
CLAIMS
4.1 Payment After Delivery of Claim Certificate. If Purchaser gives
the Escrow Holder and the Shareholder Representatives a Claim Certificate, then,
as soon as practicable after the expiration of the period ending 30 days after
the Escrow Holder's receipt of such Claim Certificate, the Escrow Holder,
subject to the provisions of Section 3.2 hereof (including, without limitation,
issuance by the Shareholder Representatives of a Dispute Notice (as defined
herein)), shall deliver to Purchaser, from the Escrow Fund, on behalf of
Purchaser or other Indemnified Parties under the provisions of Section 9.2(a) of
the Agreement that number of Escrowed Shares having a Value (to the extent the
Escrow Fund is sufficient for such purpose) equal to the Losses specified in
such Claim Certificate. Any Escrowed Shares to be delivered by the Escrow Holder
under this Section 3.1 shall be allocated among the Holders, pro rata, in
accordance with the number of shares of Company Common Stock held by the Holders
immediately prior to the Effective Time. The Escrow Holder will promptly provide
notice to the Shareholder Representatives of the Escrow Holder's receipt of the
Claim Certificate, which such notice shall specify the date of the Escrow
Holder's receipt thereof and shall attach a complete copy of the Claim
Certificate.
4.2 Disputes Respecting Claims. Unless, within 30 days after the
Escrow Holder's receipt of any Claim Certificate the Escrow Holder receives a
written notice (the "Dispute Notice") from the Shareholder Representatives
stating that the Shareholder Representatives question the accuracy of, or
otherwise dispute, a matter asserted in such Claim Certificate, such Claim
Certificate shall constitute full authority to the Escrow Holder to take the
action provided for in Section 3.1 and shall be conclusive and binding on all
parties hereto and on the Holders. If, however, the Shareholder Representatives
timely give such a Dispute Notice, the Escrow Holder shall not make any
distribution to Purchaser with respect to that portion of the Escrow Fund to
which the Disputed Notice applies until the Escrow Holder receives (i) the
written instructions of the Shareholder Representatives and Purchaser or (ii) a
final decision of a court of competent jurisdiction in the case of third party
claims or of an arbitrator in the case of a dispute between Purchaser and the
Shareholder Representatives with respect to the Claim Certificate; in each case
specifying the manner in which such distribution shall be made. For this
purpose, a final decision shall mean the final judgment of any court of
competent jurisdiction from which no appeal is then allowed or a final decision
of an arbitrator pursuant to Article IX of the Agreement.
4.3 Notice and Defense of Third Party Claims. Notice and defense of
third party claims shall be handled in the manner provided in Article IX of the
Agreement.
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Article V
DISTRIBUTION OF ESCROW FUND
5.1 Distribution of Undisputed Amounts. Subject to Section 5.2
hereof and in accordance with Section 9.1 of the Agreement, (i) on the date that
is 12 months after the Effective Time, the Escrow Holder shall distribute fifty
percent (50%) of the Escrow Fund, and (ii) on the date that is 24 months after
the Effective Time (the "Escrow Termination Date"), the Escrow Holder shall
promptly distribute the entire remaining Escrow Fund that has not been used to
indemnify Purchaser against Losses arising out or any breach of the
representations and warranties contained in Section 3.2 (Capitalization of the
Company), Section 3.13 (Tax Matters) and Section 3.18 (Environmental) of the
Agreement to the Shareholder Representatives for the benefit of the Holders, or
to the Holders if and as the Shareholder Representatives shall direct, pro rata,
according to the number of shares of Company Common Stock held by the Holders
immediately prior to the Effective Time.
5.2 Distribution of Disputed Amounts. Notwithstanding the provisions
of Section 5.1 hereof, if, prior to the Escrow Termination Date, Purchaser shall
have given a Claim Certificate to the Shareholder Representatives and the Escrow
Holder and that a dispute, in accordance with Section 4.2 hereof, respecting
that Claim Certificate or the subject matter of such Claim Certificate has not
yet been resolved in accordance with Section 4.2, then the Escrow Holder shall
continue to hold that portion of the Escrow Fund which is the subject of such
dispute. Any portion of the Escrow Fund so withheld shall continue to be held by
the Escrow Holder until it receives authorization to distribute the portion of
the Escrow Fund so withheld in accordance with the second sentence of Section
4.2.
Article X
ESCROW HOLDER
6.1 The Escrow Holder shall have no duties or responsibilities
whatsoever with respect to the Escrow Fund, except as are specifically set forth
herein. The Escrow Holder shall neither be responsible for or under, nor
chargeable with knowledge of the terms and conditions of, any other agreement,
instrument or document in connection herewith other than Section 2.4 and Article
IX of the Agreement. The Escrow Holder may conclusively rely upon, and shall be
fully protected from all liability, loss, cost, damage or expense in acting or
omitting to act pursuant to any written notice, instrument, request, consent,
certificate, document, letter, telegram, opinion, order, resolution or other
writing hereunder without being required to determine the authenticity of such
document, the correctness of any fact stated therein, the propriety of the
service thereof or the capacity, identity or authority of any party purporting
to sign or deliver such document. The Escrow Holder shall have no responsibility
for the contents of any such writing contemplated herein and may rely without
any liability upon the contents thereof.
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6.2 The Escrow Holder shall not be liable for any action taken or
omitted by it in good faith and reasonably believed by it to be authorized
hereby or with the rights or powers conferred upon it hereunder, nor for action
taken or omitted by it in good faith, and in accordance with the advice of
counsel (which counsel may be of the Escrow Holder's own choosing), and shall
not be liable for any mistake of fact or error of judgment or for any acts or
omissions of any kind, except for its own willful misconduct or gross
negligence.
6.3 Purchaser and each of the Holders jointly and severally agrees
to indemnify the Escrow Holder and its employees, directors, officers and agents
and hold each harmless against any and all liabilities incurred by it hereunder
as a consequence of such party's action, and the parties agree to indemnify the
Escrow Holder and hold it harmless against any losses, costs, payments, and
expenses (including the fees and expenses of counsel) and all liabilities
incurred by it in connection with the performance of its duties hereunder,
except in either case for losses, costs, payments and expenses (including the
fees and expenses of counsel) and liabilities incurred by the Escrow Holder
resulting from its own willful misconduct or gross negligence.
6.4 The Escrow Holder may resign upon 60 days' prior written notice
to Purchaser and the Shareholder Representatives. Similarly, the Escrow Holder
may be removed and replaced upon 60 days' prior written notice to the Escrow
Holder jointly by Purchaser and the Shareholder Representatives. In either
event, the duties of the Escrow Holder shall terminate 60 days after the date of
such notice (or at such earlier date as may be mutually agreeable), except for
its obligations to hold and deliver the Escrow Fund to the successor Escrow
Holder; and the Escrow Holder shall then deliver the balance of the Escrow Fund
then in its possession to such successor Escrow Holder as shall be appointed by
Purchaser and the Shareholder Representatives as evidenced by a written notice
filed with the Escrow Holder. If Purchaser and the Shareholder Representatives
are unable to agree upon a successor Escrow Holder by the effective date of such
resignation or removal, the then acting Escrow Holder may petition any court of
competent jurisdiction for the appointment of a successor Escrow Holder or other
appropriate relief, and any such resulting appointment shall be binding upon all
of the parties hereto. Upon acknowledgment by any successor Escrow Holder of the
receipt of the then remaining balance of the Escrow Fund, the then acting Escrow
Holder shall be fully released and relieved of all duties, responsibilities and
obligations under this Escrow Agreement.
6.5 The Escrow Holder shall not be bound in any way by any
agreement, other than this Escrow Agreement. A copy of the Agreement has been
provided to the Escrow Holder in connection with the execution of this Escrow
Agreement and the Escrow Holder understands that the terms of the Holders'
indemnification obligations are set forth in Article IX of the Agreement. The
Agreement forms an integral part of this Escrow Agreement and, therefore,
Article IX thereof is hereby incorporated by reference herein.
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6.6 The Escrow Holder shall be under no duty to institute or defend
any arbitration or legal proceeding with respect to the Escrow Fund or under
this Escrow Agreement and none of the costs or expenses or any such proceeding
shall be borne by the Escrow Holder. The costs and expenses of any such
proceeding shall be borne as decided by the arbitrators or court and shall be
direct obligations of Purchaser or the Holders, as the case may be, and shall
not be satisfied in any way by the Escrow Fund.
6.7 The Escrow Holder shall be entitled to payment from Purchaser
for customary fees and expenses for all services rendered by it hereunder in
accordance with Exhibit B attached hereto (as such Exhibit may be amended from
time to time).
Article VII
SHAREHOLDER REPRESENTATIVES
7.1 The Shareholder Representatives shall have full power and
authority to represent all of the Holders with respect to all matters arising
under this Escrow Agreement (except that the Holders shall retain the right to
vote the Escrowed Shares). All actions taken by the Shareholder Representatives
hereunder shall be conclusive and binding upon the Holders as if expressly
confirmed and ratified in writing by each of them. Without limiting the
generality of the foregoing, the Shareholder Representatives shall have full
power and authority on behalf of all of the Holders to interpret all of the
terms and provisions of this Escrow Agreement, to give all approvals and take
any other actions with respect to the Holders in connection with the subject
matter of this Escrow Agreement and to consent to any amendment hereof. The
Holders will have the right to exercise any and all rights to vote (including,
if necessary, directing the Escrow Holder to vote) the Escrow Shares deposited
in the Escrow Fund for their account so long as such Escrow Shares are held in
the Escrow Fund and have not been released to the Indemnified Parties as
provided herein and the Indemnified Parties will take all steps necessary to
allow the exercise of such rights. While the Certificates representing, and the
stock powers for, Escrow Shares remain in the Escrow Holder's possession
pursuant to this Escrow Agreement, the Holders will (subject to the provisions
of Sections 3.4 and 3.5 of this Escrow Agreement) retain and be able to exercise
all other incidents of ownership of the Escrow Shares that are not inconsistent
with the terms and conditions of this Escrow Agreement. Purchaser may deal
solely with and rely solely upon the Shareholder Representatives as the
representatives of all the Holders. The Shareholder Representatives shall incur
no liability to the Holders except by reason of their willful misconduct or
gross negligence. Each of the Shareholder Representatives may resign at any time
and be relieved of his duties as Shareholder Representative, in which case a
successor Shareholder Representative shall be elected as provided in Section
7.3. The Shareholders Representatives' appointment and authority will survive
the death, incapacity or incompetence of any Holder. The Shareholder
Representatives shall not be liable to any party hereto for any act which they
may do or omit to do hereunder in good faith.
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7.2 Limits on Liability. No Shareholder Representative shall incur
any liability with respect to any action taken or suffered by such
representative in his capacity as a Shareholder Representative in reliance upon
any note, direction, instruction, consent, statement or other documents believed
by him in good faith to be genuinely and duly authorized, or for other action or
inaction except his own willful misconduct or gross negligence. The Shareholder
Representatives may, in all questions arising under this Escrow Agreement, rely
on the advice of counsel and for anything done, omitted or suffered in good
faith by the Shareholder Representatives based on such advice, the Shareholder
Representatives shall not be liable to anyone.
7.3 Successor Shareholder Representative. In the event of the death
or permanent disability of a Shareholder Representative, or the resignation of a
Shareholder Representative as the representative of the Holders hereunder, a
successor Shareholder Representative shall be elected by a majority vote of the
Holders, with each such Holder (or his successors or assigns) to be given a
weighted voted based on such Holder's pro rata shares of Purchaser Common Stock.
Each successor Shareholder Representative shall have all of the power,
authority, rights and privileges conferred by this Escrow Agreement upon the
original Shareholder Representatives, and the term "Shareholder Representatives"
as used herein shall be deemed to include each successor Shareholder
Representative.
Article VIII
MISCELLANEOUS
8.1 Termination. This Escrow Agreement shall terminate upon the
earlier of (a) the Escrow Termination Date, assuming there are no outstanding
disputes regarding the Escrow Shares, or (b) the release by the Escrow Holder of
all of the Escrow Shares in accordance with this Escrow Agreement. In the event
there any outstanding disputes on the Escrow Termination Date, the Escrow Fund
shall continue in place until the resolution of such disputes pursuant to
Section 9.7 of the Agreement.
8.2 Notices. Except as expressly provided in this Escrow Agreement,
all notices (including any Claim Certificate) given in connection with this
Escrow Agreement shall be in writing and shall be deemed to have been duly given
on the date of delivery if delivered by hand delivery, by overnight courier
service or by facsimile to the persons identified below or three days after
mailing if mailed by certified or registered mail postage prepaid return receipt
requested addressed as follows:
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If to Purchaser:
Mitel Corporation
350 Legget Drive
P.O. Box 13089
Kanata, Ontario
Canada K2K 2W7
Attn: Secretary
With a copy to:
Howard, Rice, Nemerovski, Canady,
Falk & Rabkin
A Professional Corporation
Three Embarcadero Center, Seventh Floor
San Francisco, California 94111
Attention: Richard W. Canady
If to the Shareholder Representatives:
_________________________
_________________________
_________________________
_________________________
_________________________
_________________________
_________________________
_________________________
_________________________
With a copy to:
Stradling Yocca Carlson & Rauth, A Professional
Corporation
302 Olive Street
Santa Barbara, CA 93101
Attention: David E. Lafitte
Facsimile: (805) 564-1044
If to the Escrow Holder:
US Bank Trust, National Association
One California Street, Suite 2550
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San Francisco, CA 94111
Fax: 415 273 4590/4591
Attn: Ann Gadsby
Such addresses may be changed from time to time by means of a notice given in
the manner provided in this Section 8.2.
8.3 Successors and Assigns. The Escrow Holder (except as provided in
Article V hereof), the Shareholder Representatives (except as provided in
Article VI hereof) and Purchaser may not assign, by operation of law or
otherwise, all or any portion of its or their rights, obligations or liabilities
under this Escrow Agreement without the prior written consent of the other
parties hereto, which consent may be withheld in the absolute discretion of the
party being asked for the consent. Any attempted assignment in violation of this
Section 8.3 shall be voidable. This Escrow Agreement and all action taken
hereunder in accordance with its terms shall be binding upon and inure to the
benefit of Purchaser and the other Indemnified Parties and their respective
successors, assigns, heirs, executors, administrators and legal representatives,
the Holders and their respective successors, assigns, heirs, executors,
administrators and legal representatives, the Escrow Holder and its successors
and the Shareholder Representatives and their successors, assigns, heirs,
executors, administrators and legal representatives.
8.4 Headings. The headings contained in this Escrow Agreement are
intended principally for convenience and shall not, by themselves, determine the
rights of the parties to this Escrow Agreement.
8.5 Waiver. Waiver of any term or condition of this Escrow Agreement
by any party shall not be construed as a waiver of a subsequent breach or
failure of the same term or condition, or a waiver of any other term or
condition of this Escrow Agreement.
8.6 Governing Law. This Escrow Agreement shall be governed by, and
construed in accordance with, the laws of the State of California as applied to
agreements entered into and entirely to be performed within the state.
8.7 Arbitration. The parties hereto agree that if any Claim for
Losses is made and not resolved, such Claim shall be submitted to arbitration
under Article IX of the Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow Agreement to be
signed the day and year first above written.
MITEL CORPORATION
By: ___________________________
Title:_________________________
SHAREHOLDER REPRESENTATIVES:
_______________________________
By: ___________________________
_______________________________
By: ___________________________
_______________________________
By: ___________________________
US BANK TRUST, NATIONAL
ASSOCIATION
By: ___________________________
Name:__________________________
Title:_________________________
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EXHIBIT B
Fees and Expenses
U.S. BANK
CORPORATE TRUST SERVICES
SCHEDULE OF FEES FOR ESCROW SERVICES
Mitel Corporation / Vertex Networks, Incorporated
<TABLE>
<CAPTION>
Acceptance Fee
<S> <C> <C>
010 The acceptance fee includes the review of all documents, initial $5,000.00
set-up of the account, and other reasonably required services up to
and including the closing. This is a one-time fee, payable at
inception.
Administration/Agent Fees
Annual account administration fee covers the normal duties of the
escrow agent associated with the management of the account.
Administration fees are payable in advance and are not proratable
470 Depository Escrow Agent $1,000.00
Transaction Fees
880 Disbursement/Draw $ 20.00
Charge per item disbursed. Includes the wire or check fee.
100 Trades-Open Market/Directed $ 100.00
Charge per trade to buy or sell permitted investments. This excludes
U.S. Bank investment transactions.
101 Receipts $ 20.00
Charge per item received.
</TABLE>
EXTRAORDINARY SERVICES
Charge for duties or responsibilities of an unusual nature not
provided for in the indenture or otherwise set forth in this
schedule. A reasonable charge will be made based on the nature of
the service and the responsibility involved. These charges will be
billed as a flat fee or our hourly rate then in effect, at our
option.
Final account acceptance is subject to review of documents. Fees are based on
our understanding of the transaction and are subject to revision if the
structure is changed. In the event this transaction does not close, any related
out-of-pocket expenses will be billed to you at cost. Fees for any services not
specifically covered will be based on appraisal of services rendered.
With general reference to all of our charges, it should be understood that they
are subject to adjustment from time to time, upon written notification.
The fees in this schedule are the terms under which you agree to do business.
Closing the transaction constitutes agreement to this fee schedule, as does
payment of the invoice received after subsequent fee adjustment notification.
Absent your instructions to sweep or otherwise invest balances, no interest,
earnings, or other compensation for uninvested balances will be paid to you.
Dated: June 7, 2000 CONFIDENTIAL
