EXHIBIT 2.3
ESCROW AGREEMENT
THIS ESCROW AGREEMENT (this "Agreement") is made as of April 26, 2000,
y and among CytRx Corporation, a corporation incorporated under the laws of the
State of Delaware, (the "Company"), Majorlink Holdings Limited, a British Virgin
Islands corporation ("Investor"), and Xxxxxxx Xxxxxx & Green, P.C., (the "Escrow
Agent"). Capitalized terms used but not defined herein shall have the meanings
set forth in the Private Equity Line of Credit Agreement referred to in the
first recital.
WITNESSETH:
WHEREAS, the Investor will from time to time as requested by the
Company, purchase shares of the Company's Common Stock from the Company as set
forth in that certain Private Equity Line of Credit Agreement (the "Purchase
Agreement") dated the date hereof between the Investor and the Company, which
will be issued as per the terms and conditions contained herein and in the
Purchase Agreement; and
WHEREAS, the Company and the Investor have requested that the Escrow
Agent hold in escrow and then distribute the initial documents and certain funds
which are conditions precedent to the effectiveness of the Purchase Agreement,
and have further requested that upon each exercise of a Put, the Escrow Agent
hold the relevant documents and the applicable purchase price pending receipt by
the Investor of certificates representing the securities issuable upon such Put;
NOW, THEREFORE, in consideration of the covenants and mutual promises
contained herein and other good and valuable consideration, the receipt and
legal sufficiency of which are hereby acknowledged and intending to be legally
bound hereby, the parties agree as follows:
ARTICLE I
TERMS OF THE ESCROW FOR THE INITIAL CLOSING
1.1. The parties hereby agree to establish an escrow account with the
Escrow Agent whereby the Escrow Agent shall hold the funds and documents which
are referenced in Section 7.2 of the Purchase Agreement.
1.2. At the Initial Closing, the Company shall deliver to the Escrow
Agent:
(i) the original Warrant certificate in the form of
Exhibit D to the Purchase Agreement;
(ii) the original executed Registration Rights Agreement
in the form of Exhibit C to the Purchase Agreement;
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(iii) the original executed opinion of Xxxxxx & Bird LLP,
counsel of the Company, in the form of Exhibit E to
the Purchase Agreement;
(iv) the sum of $ 10,000;
(v) the original executed Company counterpart of this
Escrow Agreement; and
(vi) the original executed Company counterpart of the
Purchase Agreement.
1.3. Upon receipt of the foregoing, and receipt of executed
counterparts from Investor of the Purchase Agreement, the Registration Rights
Agreement and this Escrow Agreement, the Escrow Agent shall enter the
Commencement Date and Termination Date of the Warrant on the face of the Warrant
and immediately transfer the sum of Ten Thousand Dollars ($10,000) to Xxxxxxx
Xxxxxx & Green, P.C. ("EB&G"), 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 for the
Investor's legal and administrative costs and the Escrow Agent shall then
arrange to have the Warrant certificate, the Purchase Agreement, this Escrow
Agreement, the Registration Rights Agreement and the opinion of counsel
delivered to the Investor.
ARTICLE 2
TERMS OF THE ESCROW FOR EACH PUT
2.1. (a) Each time the Company shall send a Put Notice to the
Investor as provided in the Purchase Agreement, it shall send a copy, by
facsimile, to the Escrow Agent.
(b) Each time the Investor shall purchase shares pursuant to a
Put, the Investor shall send the applicable Investment Amount of the Put Shares
to the Escrow Agent on or before the Closing Date for such Put. The Company
shall promptly, but no later than five (5) Trading Days after receipt of notice
from the Escrow Agent that it has the funds for the Investment Amount cause its
Transfer Agent to deliver the Put Shares to Investor's account through the
Depository Trust Company, if possible, or else to deliver such certificates to
the Escrow Agent. In the event that the certificates representing the Put Shares
are not in the Investor's or the Escrow Agent's possession within five (5)
Trading Days of the date of the Escrow Agent's notice, then Investor shall have
the right to demand, by notice, the return of the Investment Amount, and the Put
Notice shall be deemed cancelled. The Escrow Agent shall within one (1) Trading
Day of Closing wire the Investment Amount per the written instructions of the
Company net of:
(i) a brokerage fee equal to seven percent (7%) of the
Investment Amount of each Put, to Ladenburg Xxxxxxxx
& Co. Inc.; and
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(ii) Seven Hundred Fifty Dollars ($750) as escrow
expenses to the Escrow Agent.
The Escrow Agent shall remit Broker's fee to Broker in accordance with wire
instructions that will be sent to Escrow Agent from Broker.
ARTICLE 3
MISCELLANEOUS
3.1. No waiver or any breach of any covenant or provision herein
contained shall be deemed a waiver of any preceding or succeeding breach
thereof, or of any other covenant or provision herein contained. No extension
of time for performance of any obligation or act shall be deemed an extension of
the time for performance of any other obligation or act.
All notices or other communications required or permitted hereunder shall be in
writing, and shall be sent by fax, overnight courier, registered or certified
mail, postage prepaid, return receipt requested, and shall be deemed received
upon receipt thereof, as set forth in the Purchase Agreement.
3.2. This Escrow Agreement shall be binding upon and shall inure to
the benefit of the permitted successors and permitted assigns of the parties
hereto.
3.3. This Escrow Agreement is the final expression of, and contains
the entire agreement between, the parties with respect to the subject matter
hereof and supersedes all prior understandings with respect thereto. This
Escrow Agreement may not be modified, changed, supplemented or terminated, nor
may any obligations hereunder be waived, except by written instrument signed by
the parties to be charged or by their respective agents duly authorized in
writing or as otherwise expressly permitted herein.
3.4. Whenever required by the context of this Escrow Agreement, the
singular shall include the plural and masculine shall include the feminine.
This Escrow Agreement shall not be construed as if it had been prepared by one
of the parties, but rather as if both parties had prepared the same. Unless
otherwise indicated, all references to Articles are to this Escrow Agreement.
3.5. The parties hereto expressly agree that this Escrow Agreement
shall be governed by, interpreted under and construed and enforced in accordance
with the laws of the State of New York. Except as expressly set forth herein,
any action to enforce, arising out of, or relating in any way to, any provisions
of this Escrow Agreement shall brought through the American Arbitration
Association at the designated locale of New York, New York as is more fully set
forth in the Purchase Agreement.
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3.6. The Escrow Agent's duties hereunder may be altered, amended,
modified or revoked only by a writing signed by the Company, each Investor and
the Escrow Agent.
3.7. The Escrow Agent shall be obligated only for the performance of
such duties as are specifically set forth herein and may rely and shall be
protected in relying or refraining from acting on any instrument reasonably
believed by the Escrow Agent to be genuine and to have been signed or presented
by the proper party or parties. The Escrow Agent shall not be personally liable
for any act the Escrow Agent may do or omit to do hereunder as the Escrow Agent
while acting in good faith, excepting only its own gross negligence or willful
misconduct, and any act done or omitted by the Escrow Agent pursuant to the
advice of the Escrow Agent's attorneys-at-law (other than Escrow Agent itself)
shall be conclusive evidence of such good faith.
3.8. The Escrow Agent is hereby expressly authorized to disregard any
and all warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law and is hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case the Escrow Agent obeys or complies with any such order, judgment
or decree, the Escrow Agent shall not be liable to any of the parties hereto or
to any other person, firm or corporation by reason of such decree being
subsequently reversed, modified, annulled, set aside, vacated or found to have
been entered without jurisdiction.
3.9. The Escrow Agent shall not be liable in any respect on account
of the identity, authorization or rights of the parties executing or delivering
or purporting to execute or deliver the Purchase Agreement or any documents or
papers deposited or called for thereunder or hereunder.
3.10. The Escrow Agent shall be entitled to employ such legal counsel
and other experts as the Escrow Agent may deem necessary properly to advise the
Escrow Agent in connection with the Escrow Agent's duties hereunder, may rely
upon the advice of such counsel, and may pay such counsel reasonable
compensation therefor. The Escrow Agent has acted as legal counsel for the
Investor, and may continue to act as legal counsel for the Investor, from time
to time, notwithstanding its duties as the Escrow Agent hereunder. The Company
consents to the Escrow Agent in such capacity as legal counsel for the Investors
and waives any claim that such representation represents a conflict of interest
on the part of the Escrow Agent. The Company understands that the Investor and
the Escrow Agent are relying explicitly on the foregoing provision in entering
into this Escrow Agreement.
3.11. The Escrow Agent's responsibilities as escrow agent hereunder
shall terminate if the Escrow Agent shall resign by written notice to the
Company and the Investor. In the event of any such resignation, the Investors
and the Company shall appoint a successor Escrow Agent.
3.12. If the Escrow Agent reasonably requires other or further
instruments in connection with this Escrow Agreement or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
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3.13. It is understood and agreed that should any dispute anise with
respect to the delivery and/or ownership or right of possession of the documents
or the escrow funds held by the Escrow Agent hereunder, the Escrow Agent is
authorized and directed in the Escrow Agent's sole discretion (1) to retain in
the Escrow Agent's possession without liability to anyone all or any part of
said documents or the escrow funds until such disputes shall have been settled
either by mutual written agreement of the parties concerned by a final order,
decree or judgment or a court of competent jurisdiction after the time for
appeal has expired and no appeal has been perfected, but the Escrow Agent shall
be under no duty whatsoever to institute or defend any such proceedings or (2)
to deliver the escrow funds and any other property and documents held by the
Escrow Agent hereunder to a state or federal court having competent subject
matter jurisdiction and located in the State and City of New York in accordance
with the applicable procedure therefor.
3.14. The Company and the Investor agree jointly and severally to
indemnify and hold harmless the Escrow Agent and its partners, employees, agents
and representatives from any and all claims, liabilities, costs or expenses in
any way arising from or relating to the duties or performance of the Escrow
Agent hereunder or the transactions contemplated hereby or by the Purchase
Agreement other than any such claim, liability, cost or expense to the extent
the same shall have been determined by final, unappealable judgment of a court
of competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Escrow Agent.
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IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement as of the date written above.
CYTRX CORPORATION
By:____________________________________
Xxxx X. Xxxxxxx, President and CEO
INVESTOR:
Majorlink Holdings Limited
By:____________________________________
Xxxx Xxxxxxx, Authorized Signatory
ESCROW AGENT:
XXXXXXX XXXXXX & GREEN, P.C.
By:____________________________________
Authorized Signatory
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IN WITNESS WHEREOF, the parties hereto have executed this Escrow
Agreement as of the date written above.
CYTRX CORPORATION
By:____________________________________
Xxxx X. Xxxxxxx, President and CEO
INVESTOR:
Majorlink Holdings Limited
By:____________________________________
Xxxx Xxxxxxx, Authorized Signatory
ESCROW AGENT:
XXXXXXX XXXXXX & GREEN, P.C.
By:____________________________________
Authorized Signatory
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