ESCROW AGREEMENT
This ESCROW AGREEMENT is made and entered into as of May 15, 2000, by
and among MOLECULAR DIAGNOSTICS & THERAPEUTICS, INC. ("Company"), THREE ARROWS
CAPITAL CORP. (the "Underwriter"), and NORWEST Bank COLORADO, NATIONAL
ASSOCIATION (the "Escrow Agent").
RECITALS
A. Company intends to effect a public offering (the "Offering") of
shares of Company's common stock (the "Shares") at a price of $10.00 per Share
pursuant to a prospectus and registration statement on Form SB-2 filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "Securities Act") in which Offering the Underwriter has been engaged to act
as underwriter on a 200,000 share minimum, "all or none, best efforts"/1,000,000
share maximum "best efforts" basis.
B. Company and Underwriter have agreed that the minimum must be reached
by November 15, 2000, which period may be extended for an additional 180 days at
the option of the Company, or funds received will be returned to the subscribers
with interest.
C. Escrow Agent has agreed to serve as escrow agent on the terms and
conditions contained herein.
AGREEMENTS
In consideration of the recitals and mutual covenants and agreements
set forth herein, the parties hereby covenant and agree as follows:
1. Appointment. Company and Underwriter hereby appoint Escrow Agent as
escrow agent for the purpose of holding the Escrow Funds (as defined below).
Escrow Agent hereby accepts its appointment and agrees to act as escrow agent
under the terms and conditions contained in this Escrow Agreement.
2. Delivery of Funds. Company and Underwriter hereby agree that Company
and/or the Underwriter will deliver to Escrow Agent, promptly after the receipt
of any subscriptions for the Shares, the subscription funds (which shall be
equal to the gross offering price for the Shares subscribed) in the form of
personal, bank or cashier check payable to "Norwest Bank Colorado, National
Association, as Escrow Agent for Molecular Diagnostic & Therapeutics, Inc." or a
wire transfer of federal funds for the subscription funds (which shall be equal
to the gross offering price for the Shares subscribed), and to provide Escrow
Agent, in writing, with the name, address and Taxpayer Identification Number of
each subscriber and the number of Shares for which each subscriber has
subscribed. Escrow Agent agrees to place any subscription funds so received (the
"Escrow Funds") in an account maintained by Escrow Agent under the designation
"Escrow Account for Molecular Diagnostic & Therapeutics, Inc." (the "Escrow
Account").
3. Escrow. Escrow Agent agrees to hold the Escrow Funds received by
Escrow Agent in accordance with Section 2 until the release of the Escrow Funds
pursuant to Section 4 hereof. Once all of the Escrow Funds have been disbursed
pursuant to this Escrow Agreement, Escrow Agent shall take all necessary action
to close the Escrow Account.
4. Release of the Escrow Funds. Escrow Agent shall not release any part
of the Escrow Funds to any party except as provided in this Section 4. Such
disbursements shall be made as soon as practicable after receipt by Escrow Agent
of a notice in the form of Exhibit A, Exhibit B, Exhibit C or Exhibit D hereto
(collectively, the "Disbursement Notices"), as applicable, but in no event will
Escrow Agent be required to make such disbursements more often than bi-weekly.
(a) Initial Disbursement. At any time after the Escrow Agent
has received Escrow Funds of $2,000,000 or more, if the Escrow Agent receives
written notice signed by both Company and Underwriter in the form of Exhibit A
hereto, the Escrow Agent will release the Escrow Funds on the date set forth in
and in accordance with such Disbursement Notice.
(b) Subsequent Disbursements. At any time after the initial
disbursement pursuant to Section 4(a) above, if the Escrow Agent receives
written notice signed by both Company and Underwriter in the form of Exhibit B
hereto, the Escrow Agent will release the Escrow Funds in accordance with such
Disbursement Notice.
(c) Termination of the Offering. At any time prior to the
initial disbursement pursuant to Section 4(a) above, but in no event later than
November 15, 2000, which date may be extended to a date 180 days thereafter, at
the option of the Company, if Company and Underwriter provide written notice to
Escrow Agent in the form of Exhibit C hereto, Escrow Agent will promptly return
to each subscriber the funds in the full amount of the subscriber's subscription
price at the address of the subscriber provided in accordance with Section 2 of
this Escrow Agreement, and thereafter close the Escrow Account.
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(d) Rejection of Subscription. At any time during the term of
this Agreement, if Company provides written notice to Escrow Agent in the form
of Exhibit D hereto, Escrow Agent will promptly return to the subscriber(s)
identified on Exhibit D the funds in the full amount of the subscriber's
subscription price at the address of the subscriber provided in accordance with
Section 2 of this Escrow Agreement.
(e) Notwithstanding any provision to the contrary set forth
herein, the Escrow Agent agrees it will not release any funds to the Company
pursuant to Section 4(a) unless and until it has received the written approval
of the securities administrators of the states listed on Exhibit E to release
said funds. If the Escrow Agent has not received such written approval by 2:00
p.m. on the business day immediately preceding the Closing Date specified in the
Disbursement Notice in the form of Exhibit A hereto, it will notify the Company
and the Underwriter by telephone that it cannot disburse the funds on the
Closing Date in accordance with the Disbursement Notice.
5. Escrow Agent. Escrow Agent shall be liable as a depository only and
shall not be responsible or accountable for the correctness of any information
set forth in any statements delivered to it, including, without limitation, any
Disbursement Notice, shall not be required in any event to verify the
correctness of any such statements and shall not be responsible for verifying
compliance by either Company or Underwriter with the Securities Act, the rules
and regulations thereunder or any other securities laws, rules or regulations,
or the terms of any Subscription Agreement or any agreement between Company and
Underwriter. Escrow Agent shall be entitled to rely, without any investigation
whatsoever, upon any communication received from the Company, the Underwriter or
any state securities administrator, and Escrow Agent shall be entitled to deem
the signatories of any Subscription Agreement or any communication submitted to
it hereunder as being those purported to be authorized to sign such
communication on behalf of such party and shall be entitled to rely on the
genuineness of the signatures of such signatories without inquiry and without
sustaining evidence of any kind. Escrow Agent shall have the right to consult
with counsel and shall be fully protected and shall not be liable with respect
to any action, taken or omitted by Escrow Agent in good faith and on advice of
counsel, and shall be fully protected and shall not be liable for any error of
judgments or for any act done or omitted by it in good faith, except for its own
gross negligence or willful misconduct, and Escrow Agent shall have no duties to
anyone except those signing this Escrow Agreement.
6. Indemnification. Escrow Agent shall be indemnified and held harmless
by Company from and against any taxes, assessments, liabilities, claims,
damages, actions, suits, costs and expenses (including attorney's fees) or other
charges suffered or incurred by Escrow Agent in connection with the performance
of its services hereunder, unless caused by Escrow Agent's gross negligence or
willful misconduct. Escrow Agent is hereby authorized by Company to deduct such
amount from any funds due to Company hereunder. The provisions of Sections 5 and
6 shall survive the termination of Escrow Agent's duties hereunder.
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7. No Control. It is agreed that, except as explicitly permitted by
this Escrow Agreement, Company and Underwriter shall have no right to receive,
manage, transfer or otherwise control, in any way, any amounts held in the
Escrow Account and at no time prior to actual payment from the Escrow Account
shall Company or Underwriter be considered to be in actual or constructive
receipt of any amounts held in the Escrow Account.
8. Miscellaneous.
(a) This Escrow Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof, and this Escrow
Agreement may not be modified or amended except by written instrument executed
by all the parties hereto. Company and Underwriter acknowledge that Escrow Agent
is neither a party to, nor bound by any provisions of, any Subscription
Agreement.
(b) This Escrow Agreement shall be binding upon the parties
hereto and their respective successors and assigns, and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
(c) This Escrow Agreement shall be governed by and construed
in accordance with the laws of the State of Colorado, without giving effect to
any choice of law or conflict of law provision or rule (whether of the State of
Colorado or any other jurisdiction) that would cause the application of the law
of any jurisdiction other than the State of Colorado.
(d) All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given or
made upon receipt, if delivered personally, or on the third business day
following deposit in the U.S. mail if mailed by registered or certified mail
(postage prepaid, return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
changes of address).
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If to Company:
Molecular Diagnostic & Therapeutics, Inc.
0000 Xxxxxxxxxx Xxxxxx, Xxxxx X-0
Xxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, President
with a copy to:
Reinhart, Boerner, Van Deuren,
Xxxxxx & Rieselbach, P.C.
0000 Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
If to Underwriter:
Three Arrows Capital Corp.
00000 Xxxxxxxxx Xxxxx #0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxxxx
If to Escrow Agent:
Norwest Investment Management and Trust
Corporate Trust and Escrow Services
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
9. Escrow Dispute. In the event of any disagreement between Company and
Underwriter or Company and subscribers resulting in adverse claims and demands
being made in connection with or for the Escrow Funds, Escrow Agent shall be
entitled, as its option, to hold the Escrow Fund until such time as a mutual
agreement has been reached among all the parties or until disbursement is
legally authorized by final judgment or decree of any court having jurisdiction
thereover, or to deposit the Escrow Funds with any court having jurisdiction
thereover pending the resolution of the disagreement.
10. Termination. This Escrow Agreement shall terminate and be of no
further force and effect on the earliest to occur of (a) receipt by Escrow Agent
of written notice of termination jointly executed (in counterparts if necessary)
by Company and Underwriters; or (b) the closing of the Escrow Account in
accordance with the provisions hereof.
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11. Resignation. Escrow Agent, acting at any time hereunder, may resign
at any time by giving 30 days' prior written notice of resignation to Company
and Underwriter, such resignation to be effective on the date specified on such
notice. Upon the effectiveness of such resignation, Escrow Agent shall transfer
the Escrow Funds to such succeeding Escrow Agent or to such persons as
Underwriter and Company designate in writing to Escrow Agent prior to the
effectiveness of the resignation. In the event no such designation has been
provided, Escrow Agent shall deposit the Escrow Fund with any court having
jurisdiction thereover. Prior to the effectiveness of the resignation of Escrow
Agent, Escrow Agent shall remain obligated to perform all duties required of it
under this Escrow Agreement.
12. Counterparts. This Escrow Agreement may be executed in two or more
counterparts, each of which shall be deemed an original.
IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement as of the day and year first above written.
COMPANY: MOLECULAR DIAGNOSTIC & THERAPEUTICS, INC.
By:______________________________
Its: ___________________________
UNDERWRITER: THREE ARROWS CAPITAL CORP.
By:______________________________
Its: ___________________________
ESCROW AGENT: NORWEST BANK COLORADO,
NATIONAL ASSOCIATION
By:______________________________
Its: ___________________________
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EXHIBIT A
Disbursement Notice
Initial Disbursement
(Date)
Norwest Investment management and Trust
Corporate Trust and Escrow Services
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Re: Escrow Account No. _____________
Dear _____________:
1. Reference is made to that certain Escrow Agreement dated as of March
__, 2000, by and among Molecular Diagnostic & Therapeutics, Inc. ("Company"),
Three Arrows Capital Corp. ("Underwriter"), and Norwest Bank Colorado, National
Association (the "Escrow Agreement"). All terms used but not defined herein
shall have the respective meanings given such terms in the Escrow Agreement.
2. All conditions to the purchase by the subscribers from Company and
the sale by Company to the subscribers of the Shares have been satisfied or
waived.
3. You are hereby directed to disburse on _________, 200_ (the "Closing
Date") the following amounts as indicated below:
To Underwriter:
[Amount]
[Form of disbursement]
[If by wire transfer:] (Name/Address of Receiving Bank)
(ABA # of Receiving Bank)
(Receiving Account Number)
(Receiving Account Name)
Re:
To Company:
[Amount]
[Form of disbursement]
[If by wire transfer:] (Name/Address of Receiving Bank)
(ABA # of Receiving Bank)
(Receiving Account Number)
(Receiving Account Name)
Re:
IN WITNESS WHEREOF, the undersigned have executed this statement on the
date indicated above.
COMPANY: MOLECULAR DIAGNOSTIC & THERAPEUTICS, INC.
By:______________________________
Its: __________________________
UNDERWRITER: THREE ARROWS CAPITAL CORP.
By:______________________________
Its: __________________________
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EXHIBIT B
Disbursement Notice
Subsequent Disbursements
(Date)
Norwest Investment management and Trust
Corporate Trust and Escrow Services
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Re: Escrow Account No. _____________
Dear _____________:
1. Reference is made to that certain Escrow Agreement dated as of March
__, 2000, by and among Molecular Diagnostic & Therapeutics, Inc. ("Company"),
Three Arrows Capital Corp. ("Underwriter"), and Norwest Bank Colorado, National
Association (the "Escrow Agreement"). All terms used but not defined herein
shall have the respective meanings given such terms in the Escrow Agreement.
2. You are hereby directed to disburse the following amounts as
indicated below:
To Underwriter:
[Amount]
[Form of disbursement]
[If by wire transfer:] (Name/Address of Receiving Bank)
(ABA # of Receiving Bank)
(Receiving Account Number)
(Receiving Account Name)
Re:
To Company:
[Amount]
[Form of disbursement]
[If by wire transfer:] (Name/Address of Receiving Bank)
(ABA # of Receiving Bank)
(Receiving Account Number)
(Receiving Account Name)
Re:
IN WITNESS WHEREOF, the undersigned has executed this statement on the
date indicated above.
COMPANY: MOLECULAR DIAGNOSTIC & THERAPEUTICS, INC.
By:______________________________
Its: ___________________________
UNDERWRITER: THREE ARROWS CAPITAL CORP.
By:______________________________
Its: ___________________________
2
EXHIBIT C
Disbursement Notice
Termination Notice
(Date)
Norwest Investment management and Trust
Corporate Trust and Escrow Services
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Re: Escrow Account No. _____________
Dear _____________:
1. Reference is made to that certain Escrow Agreement dated as of March
__, 2000, by and among Molecular Diagnostic & Therapeutics, Inc. ("Company"),
Three Arrows Capital Corp. ("Underwriter"), and Norwest Bank Colorado, National
Association (the "Escrow Agreement"). All terms used but not defined herein
shall have the respective meanings given such terms in the Escrow Agreement.
2. Company and Underwriter have terminated the Offering prior to the
initial disbursement pursuant to Section 4(a) of the Escrow Agreement
3. You are hereby directed to disburse the Escrow Fund to the
subscribers in accordance with Section 4(c) of the Escrow Agreement.
IN WITNESS WHEREOF, the undersigned have executed this statement on the
date indicated above.
COMPANY: MOLECULAR DIAGNOSTIC & THERAPEUTICS, INC.
By:______________________________
Its: __________________________
UNDERWRITER: THREE ARROWS CAPITAL CORP.
By:______________________________
Its: __________________________
EXHIBIT D
Disbursement Notice
Rejection of Subscription
(Date)
Norwest Investment management and Trust
Corporate Trust and Escrow Services
0000 Xxxxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Re: Escrow Account No. _____________
Dear _____________:
1. Reference is made to that certain Escrow Agreement dated as of March
__, 2000, by and among Molecular Diagnostic & Therapeutics, Inc. ("Company"),
Three Arrows Capital Corp. ("Underwriter"), and Norwest Bank Colorado, National
Association (the "Escrow Agreement"). All terms used but not defined herein
shall have the respective meanings given such terms in the Escrow Agreement.
2. Company has determined to reject the following subscription(s):
Name of Subscriber Amount of Subscription
3. A copy of the Company's notice of rejection to the subscriber is
attached hereto.
4. You are hereby directed to disburse the Escrow Fund to the
subscribers named above in
accordance with Section 4(d) of the Escrow Agreement.
IN WITNESS WHEREOF, the undersigned have executed this statement on the
date indicated above.
COMPANY: MOLECULAR DIAGNOSTIC & THERAPEUTICS, INC.
By:______________________________
Its: _________________________
