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Exhibit 2
ESCROW AGREEMENT
This Escrow Agreement (this "Escrow Agreement") dated as of January 21,
2000 is made and entered into by and among Deere Park Capital, L.L.C. ("Deere
Park"), American Eco Corporation ("AEC") and LaSalle Bank National Association
(the "Escrow Agent"). All capitalized terms used and not defined herein shall
have the meanings contained in that certain Settlement Agreement dated January
21, 2000 by and among Deere Park, U.S. Industrial Services, Inc. ("USIS") and
AEC (the "Settlement Agreement"). A copy of the Settlement Agreement is attached
for ease of reference for such definitions.
RECITALS:
WHEREAS, pursuant to the Settlement Agreement, Deere Park and AEC have
agreed to suspend the Litigation until May 15, 2000 by providing, among other
things, for the irrevocable and unconditional right by Deere Park upon an Event
of Default to receive and foreclose, in whole or in part, some or all of the
Pledged Securities;
WHEREAS, the Settlement Agreement provides for the execution and delivery
of an escrow agreement, and Deere Park and AEC have agreed that the execution
and delivery of this Escrow Agreement shall satisfy the obligations of the
parties hereto to execute and deliver such an escrow agreement.
NOW, THEREFORE, in consideration of the consummation of the transactions
contemplated by the Settlement Agreement, the covenants and agreements herein
set forth and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, hereby agree as follows:
1. Appointment and Agreement of the Escrow Agent. Deere Park and AEC hereby
appoint and designate the Escrow Agent as the escrow agent for the purposes set
forth herein, and the Escrow Agent hereby accepts such appointment under the
terms and subject to the conditions set forth herein.
2. Deposit of the Pledged Securities and USIS Collateral. Pursuant to the
Settlement Agreement, as of January 21, 2000, AEC shall deliver to the Escrow
Agent 7 certificates which represent 7,175,858 shares of common stock (the
"Pledged Securities") in USIS to be held in an account (the "Escrow Account").
The Pledged Securities represent all of the equity interests in USIS owned by
AEC. The cost of establishing the Escrow Account and the ongoing cost and
expenses including Deere Park's legal fees and other expenses related to such
Escrow Account shall be borne by AEC. In addition, AEC shall deliver to the
Escrow Agent the assignment of the USIS Collateral (as such term is defined in
the Settlement Agreement).
3. Establishment of Escrow.
3.1 Pledged Securities. The Escrow Agent shall hold in escrow the
Pledged Securities for the benefit of Deere Park to secure payment to Deere Park
of all amounts owed to
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it under the Settlement Agreement.
3.2 Use of Pledged Securities. The Pledged Securities shall be held and
disbursed pursuant to the terms and subject to the conditions of the Settlement
Agreement, as set forth in Section 4 hereof
3.3 USIS Collateral. The USIS Collateral shall be held and disbursed
pursuant to the terms and subject to the conditions as set forth in Section 4
hereof
4. Disbursements of the Pledged Securities.
4.1 Disbursement Upon Event of Default in Payments.
The Settlement Agreement provides that AEC shall deliver to the
Escrow Agent, for the benefit of Deere Park: (i) $40,000 concurrent with the
execution of this Escrow Agreement ($35,000 by wire transfer payable to Deere
Park and $5,000 by wire transfer payable to the Escrow Agent); and (ii)
$2,807,235 on or before May 15, 2000 (collectively, the "Payments"). All
Payments (except the $35,000 payable above) shall be paid to Escrow Agent Escrow
Agent's records shall be dispositive concerning the receipt of all Payments.
Within one (1) business day of receipt, Escrow Agent will promptly remit to
Deere Park any Payments. Notwithstanding any other remedies available under this
Escrow Agreement and the provisions of Section 4.2 below, upon any Event of
Default, where AEC fails to timely make either of the Payments, the Escrow
Agent, without further inquiry by the Escrow Agent, further instruction to the
Escrow Agent or further notice to the parties hereto, shall immediately deliver
the Pledged Securities to Deere Park, with stock powers endorsed in blank
necessary for Deere Park to foreclose upon the Pledged Securities.
4.2 Disbursement Upon Other Events of Default.
Upon any Event of Default other than an Event of Default arising
from failure to timely make either of the Payments, Deere Park shall deliver to
the Escrow Agent and AEC a written notice of such Event of Default, in which
notice Deere Park shall use commercially reasonable efforts to set forth the
nature of such Event of Default based on information reasonably available to
Deere Park. Within two (2) business days of receipt of such notice by the Escrow
Agent and without any further inquiry by the Escrow Agent or further instruction
to the Escrow Agent, the Escrow Agent shall deliver to Deere Park from the
Escrow Account the USIS Collateral and number of Pledged Securities, as well as
assignments separate from certificates, as indicated in such notice, unless the
Escrow Agent shall have received a written notice of AEC's objection to the
Event of Default. In the event Deere Park and AEC dispute the occurrence of an
Event of Default, they shall use their best efforts to cause such matters to be
heard at an evidentiary hearing of the court in the Litigation no later than two
business days after AEC's notice of objection and the Escrow Agent shall act in
the manner directed by the court in the Litigation.
4.3 Disbursement Upon Payments by AEC.
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The Escrow Agent shall maintain a separate account for the Payments
and shall promptly notify Deere Park of receipt of all or any portion of the
Payments from AEC. The parties hereto acknowledge that the interest accrued on
the Payments shall be prorated to the extent the Payments are received prior to
May 15, 2000. The Escrow Agent shall deliver the Pledged Securities and the USIS
Collateral to AEC within 95 days following the Escrow Agent's receipt of the
Payments and an amount for Deere Park's legal fees not to exceed $5,000 (such
legal fees to be confirmed in writing to the Escrow Agent by Deere Park).
5. Termination of Escrow.
5.1 Ninety-five days after the last of the Payments have been made
to the Escrow Agent, unless bankruptcy proceedings have been initiated by or
against AEC, without further inquiry by the Escrow Agent or further instruction
to the Escrow Agent, the Escrow Agent shall terminate this Agreement and deliver
the Pledged Collateral.
5.2 This Escrow Agreement shall automatically terminate if and when
all of the Pledged Collateral shall have been released by the Escrow Agent in
accordance with the terms and subject to the conditions of this Escrow
Agreement. Thereafter, the Escrow Agent shall be deemed to have discharged all
of its obligations hereunder.
6. Matters Affecting the Escrow Agent.
6.1 Indemnification of the Escrow Agent. From and at all times after
the date of this Escrow Agreement, Deere Park and AEC shall., to the fullest
extent permitted by law and to the extent provided herein, indemnify and hold
harmless the Escrow Agent and each director, officer, employee, attorney, agent
and affiliate of the Escrow Agent (collectively, the "Indemnified Parties")
against any and all actions, claims (whether or not valid), losses, damages,
liabilities, costs and expenses of any kind or nature whatsoever (including,
without limitation, reasonable attorneys' fees, costs and expenses actually
incurred) incurred by or asserted against any of the Indemnified Parties from
and, after the date hereof, whether direct; indirect or consequential, as a
result of or arising from or in any way relating to any claim, demand, suit,
action or proceeding (including any inquiry or investigation) by any person,
including, without limitation, Deere Park or AEC, whether threatened or
initiated, asserting a claim for any legal or equitable remedy against any
person under any statute or regulation, including, but not limited to, any
applicable securities laws, or under any common law or equitable cause or
otherwise, arising from or in connection with the negotiation, preparation,
execution, performance or failure of performance of this Escrow Agreement or any
transactions contemplated herein, whether or not any such Indemnified Party is a
party to any such action, proceeding, suit or the target of any such inquiry or
investigation; provided, however, that no Indemnified Party shall have the right
to be indemnified hereunder for any liability finally determined by a court of
competent jurisdiction to have resulted solely from the gross negligence or
willful misconduct of such Indemnified Party. If any such action or claim shall
be brought or asserted against any Indemnified Party, such Indemnified Party
shall promptly notify Deere Park and AEC in writing, and Deere Park and AEC
shall assume the defense thereof, including the employment of counsel and the
payment of all expenses. Such
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Indemnified Party shall, in its sole discretion, have &righti to employ separate
counsel (who may be selected by such Indemnified Party in its sole discretion)
in any such action and to participate in the defense thereof, and the fees and
expenses of such counsel shall be paid by such Indemnified Party, except that
Deere Park and AEC shall be required to pay such fees and expenses. Each of
Deere Park, on the one hand, and AEC, on the other hand, shall be responsible
for one-half (1/2) of each such indemnification responsibility. All such
reasonable fees and expenses payable by Deere Park and/or AEC pursuant to the
foregoing sentence shall be paid from time to time as incurred, both in advance
of and after the final disposition of such action or claim. The obligations of
Deere Park and AEC under this Section 6.1 shall survive any termination of this
Escrow Agreement and the resignation or removal of the Escrow Agent shall be
independent of any obligation to the Escrow Agent. The parties agree that
neither the payment by Deere Park or AEC of any claim by the Escrow Agent for
indemnification hereunder nor the disbursement of any amounts to the Escrow
Agent in respect of a claim by the Escrow Agent for indemnification shall
impair, limit, modify or affect as between Deere Park and AEC, the respective
rights and obligations of Deere Park, on the one hand, and AEC, on the other
hand, under the Settlement Agreement
6.2 Duties and Liability of the Escrow Agent. The Escrow Agent's
sole responsibility shall be for the safekeeping and disbursement of the Pledged
Securities in accordance with the terms of this Escrow Agreement. The Escrow
Agent shall have no implied duties or obligations and shall not be charged with
knowledge or notice of any fact not specifically set forth herein. The Escrow
Agent may rely upon any instrument, not only as to its due execution, validity
and effectiveness, but also as to the truth and accuracy of any information
contained therein, which the Escrow Agent shall in good faith believe to be
genuine, to have been signed or presented by the person or parties purporting to
sign the same and to conform to the provisions of this Escrow Agreement. Except
to the extent of gross negligence or willful misconduct, in no event shall the
Escrow Agent be liable for incidental, indirect, special, consequential or
punitive damages. The Escrow Agent shall not be obligated to take any legal
action or commence any proceeding in connection with the Escrow Account, any
account in which the Pledged Securities are deposited, this Escrow Agreement or
the Settlement Agreement, or to appear in, prosecute or defend any such legal
action or proceeding. The Escrow Agent may consult legal counsel selected by it
in the event of any dispute or question as to the construction of any of the
provisions hereof or of any other agreement or of its duties hereunder, or
relating to any dispute involving any party hereto Deere Park and AEC, jointly
and severally, shall promptly pay, upon demand, the reasonable fees and expenses
actually incurred of any such counsel.
6.3 Fees. AEC shall compensate the Escrow Agent for its services
hereunder in accordance with Schedule A attached hereto. All of the compensation
and reimbursement obligations set forth in this Section 6.3 shall be payable by
AEC upon demand by the Escrow Agent. The obligations of Deere Park and AEC under
this Section 6.3 shall survive any termination of this Escrow Agreement and the
resignation or removal of the Escrow Agent. AEC shall promptly pay such amounts
to the Escrow Agent or any Indemnified Party upon receipt of an itemized
invoice.
6.4 Escrow Agent to Follow Instructions of Deere Park and AEC.
Except for
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matters covered by Section 4 and Section 5 hereof, the Escrow Agent shall at any
time and from time to time take such action hereunder with respect to the
Pledged Securities as shall be agreed to in writing by Deere Park and AEC.
6.5 Removal and Resignation of the Escrow Agent. Deere Park and AEC,
acting jointly, may remove the Escrow Agent at any time upon thirty (30)
calendar days' prior written notice, signed by both Deere Park and AEC, to the
Escrow Agent. The Escrow Agent may resign at any time upon thirty (30) calendar
days prior written notice (unless waived by both Deere Park and AEC) to Deere
Park and AEC. Within thirty (30) calendar days after giving the foregoing notice
of resignation from the Escrow Agent Deere Park and AEC shall jointly agree on
and appoint a successor escrow agent. The successor escrow agent shall be a
national bank having combined capital and surplus satisfactory to Deere Park as
shall be mutually selected by Deere Park and AEC. Any such successor escrow
agent shall be appointed by a written instrument mutually satisfactory to and
executed by Deere Park and AEC, the Escrow Agent and the successor escrow agent.
If a successor escrow agent has not accepted such appointment by the end of
such thirty (30) calendar day period, the Escrow Agent may apply to a court of
competent jurisdiction for the appointment of a successor escrow agent or for
other appropriate relief The reasonable costs and expenses (including reasonable
attorneys' fees and expenses actually incurred) incurred by the Escrow Agent in
connection with such proceeding shall be paid by, and be deemed a joint and
several obligation of, Deere Park, on the one hand, and AEC, on the other hand.
Any successor escrow agent appointed under the provisions of this Escrow
Agreement shall have all of the same rights, powers, privileges, immunities and
authority with respect to the matters contemplated herein as are granted herein
to the original Escrow Agent. It is understood and agreed that no resignation of
the Escrow Agent shall be effective until a successor escrow agent agrees to act
hereunder. If the Escrow Agent submits a notice of resignation, its only duty,
until a successor escrow agent shall have been appointed and shall have accepted
such appointment, shall be to hold and dispose of the Pledged Securities in
accordance with this Escrow Agreement, but without regard to any notices,
requests, instructions, demands or the like received by it from the other
parties hereto after such notice of resignation shall have been given, unless
the same is a direction that the Pledged Securities be delivered in their
entirety to one of the other parties hereto.
7. Other Provisions.
7.1 Amendment and Waiver. This Escrow Agreement may not be amended
or waived except in a writing executed by the party against which such amendment
or waiver is sought to be enforced. No course of dealing between or among any
persons having any interest in this Escrow Agreement will be deemed effective to
modify or amend any part of this Escrow Agreement or any rights or obligations
of any person under or by reason of this Escrow Agreement.
7.2 Notices. All notices, requests, demands, claims, and other
communications
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hereunder will be in writing. Any notice, request, demand, claim or other
communication hereunder shall be deemed duly given: (i) when delivered, if
delivered in person or by commercial messenger service; or (ii) two days
following deposit with a recognized overnight courier service, provided that
such deposit occurs prior to such deadline as has been imposed by such service
for overnight delivery; or (iii) when transmitted, if sent by facsimile copy,
provided confirmation of receipt is received by the sender, in each case
provided that such communication is addressed to the intended recipient thereof
as set forth below:
If to Deere Park:
Deere Park Capital, L.L.C.
40 Skokie Blvd.
Suite 110
Northbrook, Illinois 60062
Attn: David J. Morris, Esq.
Fax: (847) 509-8525
with a copy to:
Holleb & Coff
55 E. Monroe Street
Suite 4000
Chicago, Illinois 60603
Attn: Don S. Hershman, Esq.
Fax: (312) 807-3900
If to AEC:
American Eco Corporation
110 11 Jones Road
Houston, Texas 77070
Attn: Michael McGinnis
Fax: (281) 774-7005
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If to Escrow Agent:
LaSalle Bank National Association
135 South LaSalle Street
Suite 1960
Chicago, IL 60603
Attn: Laura H. Mackey
Fax: (312) 904-2236
Any party may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery or electronic mail), but no
such notice, request, demand, claim or other communication shall be deemed to
have been duly given unless and until it actually is received by the intended
recipient. Any party may change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered by giving the
other parties notice in the manner herein set forth.
7.3 Binding Effect and Assignment. This Escrow Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns. Neither this
Escrow Agreement nor any of the rights, interests or obligations hereunder may
be assigned by AEC, Deere Park or the Escrow Agent without the prior written
consent of Deere Park and AEC.
7.4 Severability. Whenever possible, each provision of this Escrow
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Escrow Agreement is held to be
prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Escrow Agreement.
7.5 Complete Agreement; No Third Party Beneficiaries. Subject to the
terms of the Settlement Agreement concerning AEC and Deere Park, this Escrow
Agreement contains the complete agreement between the parties and supersedes any
prior understandings, agreements or representations by or between the parties,
written or oral, which may have related to the subject matter hereof in any way.
Nothing in this Escrow Agreement, expressed or implied, is intended to confer
upon any person or entity, other than the parties hereto and their respective
successors and permitted assigns, any rights, remedies, obligations or
liabilities under or by reason of this Escrow Agreement.
7.6 Governing Law. This Escrow Agreement shall be construed, governed
and enforced according to the internal laws of the State of Illinois without
regard to conflicts of law principles. Any suit or proceeding brought hereunder
shall be subject to the exclusive jurisdiction of the courts located in Cook
County, Illinois. The parties hereto submit to such jurisdiction.
8. [INTENTIONALLY OMITTED].
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9. Attorneys' Fees. Should any litigation be commenced between Deere Park,
on one hand, and AEC, on the other hand, concerning this Escrow Agreement or the
rights and duties of any party in relation thereto, Deere Park, if it is the
prevailing party, shall be entitled, in addition to such other relief as may be
granted, to receive reimbursement from the opposing party or parties, as
applicable, for Deere Park's attorneys' fees in such litigation, which shall be
determined by the court in that litigation.
10. Waiver of Trial by Jury. EACH OF THE PARTIES HERETO WAIVES, TO THE
EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO ASSERT THE
DOCTRINE OF FORUM NON-CONENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY
PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 10. EACH OF THE PARTIES
HERETO WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, INCLUDING CONTRACT CLAIMS,
TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
CLAIMS. EACH OF THE PARTIES HERETO REPRESENTS THAT IT HAS REVIEWED THIS WAIVER
AND KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL CONSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
11. Counterparts and Facsimile Signatures. This Escrow Agreement may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument.
Notwithstanding the laws of any jurisdiction in which this Agreement is executed
or delivered, a facsimile signature shall for all purposes be deemed an original
and shall bind the signor as if such facsimile were an original. Each party
hereto undertakes to deliver to each other party hereto original copies of any
facsimile signature by overnight courier to the addresses set forth in Section
7.2 above.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed effective as of the date first written above.
DEERE PARK CAPITAL, L.L.C.
By:
----------------------------------------
Name:
Its:
AMERICAN ECO CORPORATION
By:
----------------------------------------
Name:
Its:
LASALLE BANK NATIONAL
ASSOCIATION
AS ESCROW AGENT
By:
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Name: Estelita E. Tucker
Its: Vice President
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