**Exhibit 10.59**

 

February 1,2005

 

PolarMolecular Holding Corporation

4600South Ulster Street Suite 940

Denver,CO

80237

 

Attention:Mr. Mark L. Nelson - Chairman and President

 

DearSirs:

 

Furtherto our discussions, Dominick & Dominick Securities Inc. (“Dominick”)is pleased to outline the terms of an agreement with Polar Molecular HoldingCorporation (the “Corporation”) pursuant to which we have been engaged to actas the Corporation’s agent (“Agent”) for the private placement offering ofunits or such other equity or debt as may be agreed upon by the parties, aswell as sponsorship of the Corporation for listing on the TSX Venture Exchange.

 
| Issuer:              |   | Polar  Molecular Holding Corporation (the “Corporation”).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
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| Agent:               |   | Dominick &  Dominick Securities Inc. (the “Agent”) and such other members of a selling  syndicate as may be agreed upon by the Corporation and Dominick.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
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| Nature  of Offering: |   | Reasonable  Best Efforts.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
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| Offering:            |   | Up to  US$7.0 million in units (“Units”) at a subscription price of $0.20 per Unit,  each Unit consisting of one common share and one voting preference share (“Voting  Preference Share”) of the Corporation, that will separate at Closing (each  Voting Preference Share will automatically convert into one common share of  the Corporation, upon the increase in the authorized common share capital of  the Corporation, which is to be submitted to shareholders for approval and to  be effective on or before April 15, 2005), subject to adjustment and  conversion into a greater number of common shares in the circumstances  described below under “Characteristics of Preferred Shares”. |
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| Offering Price:      |   | $0.20 per Unit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |

 

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| Use of Proceeds:         |   | The proceeds will be used to reduce indebtedness, implement a marketing  plan for the Corporation’s products and for general working capital.                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
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| Offering Jurisdictions:  |   | Ontario, Alberta, British Columbia and such other jurisdictions in Canada  as mutually agreed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
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| Statutory Exemptions to  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| be Relied Upon           |   | The Units will be sold in the Offering Jurisdictions pursuant to  prospectus and registration exemptions for “accredited investors”.                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
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| Qualification  of        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Securities  Distributed: |   | No  prospectus will be filed to qualify the distribution of common shares or such  other equity or debt securities issued pursuant to this Offering in the  Offering Jurisdictions, provided at the time of Closing securities issued in  the Offering qualify for a hold period terminating four months and one day  from the Closing Date, pursuant to Multilateral Instrument 45-102 - Resale of  Securities. The Corporation will file a Registration Statement qualifying the  securities issued in this Offering for resale in the United States within 90  days of Closing.                      |
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| Commission  and          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Sponsorship  Fee:        |   | The  Corporation shall pay Dominick (and such other members of a selling  syndicate) (collectively, the “Agents”), from gross proceeds of the Offering,  a cash commission fee equal to 10% of the gross proceeds of the Offering, and  broker’s warrants to acquire that number of common shares as is equal to 10%  of the number of common shares issued in connection with the Offering, at an  exercise price equal to the Offering Price for a period of 24 months from  Closing.                                                                                                  |
|                     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                     |   | The  Corporation shall pay Dominick a Sponsorship Fee, upon listing on the TSX Venture  Exchange, in an amount not less than $50,000, plus all disbursements.  Particulars of the terms of Sponsorship will be set out in a Sponsorship  Agreement.                                                                                                                                                                                                                                                                                                                                                     |
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| Work Fees:               |   | The corporation shall  pay Dominick 1,000,000 common shares for advisory services rendered to  prepare for the above stated financing.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
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| Holdover  Provision:     |   | If any  person or party or affiliate or associate of such person or party is  introduced by Dominick, to the Corporation or any of its insiders or  affiliates, prior to termination of this agreement and with whom discussions  have been initiated (other than existing shareholders of the Corporation),  and a transaction subsequently closes with such person or party or affiliate  or associate of such person or party, within a period of one year after  termination of this agreement, the Corporation shall pay to Dominick an  amount in cash equal to 10% of the gross proceeds raised, |

 

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|                                 |   | and  broker’s warrants to acquire that number of common shares as is equal to 10%  of the gross proceeds raised, at an exercise price equal to current market  price of the shares at the time of such closing, for a period of 24 months  from such closing. Dominick will provide to the Corporation a list of  investors with whom discussions have been initiated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
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| Right of First Refusal:              |   | If the Offering is completed, the  Corporation shall grant a right of first refusal to Dominick to act as lead  underwriter or agent in respect of any subsequent public offering or private  placement of equity in Canada or the United States by the Corporation, or any  of its subsidiaries or affiliates for a period of eighteen (18) months from  Closing, subject to Dominick and the Corporation, acting reasonably, agreeing  on the terms and conditions thereof.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
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| Characteristics  of Preferred Shares |   | Each Voting Preference  Share will automatically convert into one common share of the Corporation on  the date that the authorized common share capital of the Corporation is  increased to permit the conversion of all outstanding Voting Preference Shares.  If the authorized common share capital is not increased to permit the  automatic conversion of all outstanding Voting Preference Shares into the  corresponding number of Common Shares on or before April 15, 2005, the  Corporation will register the outstanding Voting Preference Shares for  quotation on OTCBB on or before May 31, 2005 and the outstanding Voting  Preference Shares will automatically convert, effective as of March 31,  2005, into 1.1 common shares in the capital stock of the Corporation upon the  increase in the Corporation’s authorized common share capital. The Voting  Preference Shares will have the same attributes as the common shares, save  and except that any Voting Preference Shares outstanding on or after  April 30, 2005 will participate on liquidation, dissolution, windup or  dividend distribution of the Corporation on the basis of 1.1 common shares  for each Voting Preference Share held. If the Voting Preference Shares are to  be registered on or before June 30, 2005, and registration of the Voting  Preference Shares does not occur by that date, each Voting Preference Share  will be automatically convertible thereafter into an additional 0.1 Common  Shares for each calendar month that such shares remain unregistered prior to  conversion. By way of example, should the authorized common share capital of  the Corporation not be increased to authorize the conversion of all of the  outstanding Voting Preference Shares into Common Shares and should the  outstanding Voting Preference Shares not be registered for quotation on the  OTCBB by October 15, 2005, each Voting Preference Share would be  convertible, until November 15, 2005, into 1.5 Common Shares, and 1.6  Common Shares thereafter. |

 

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| Costs  and Expenses: |   | Reasonable  costs and expenses of the Offering, whether or not the Offering is completed,  shall be paid by the Corporation including (i) reasonable costs and  expenses of the Agent(s); and (ii) reasonable costs and expenses of  Agent(s)’ legal counsel.                                                                                                                                                                                                                                       |
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| Closing  Date:       |   | On or  about February 25, 2005 or such other date as mutually agreed upon.                                                                                                                                                                                                                                                                                                                                                                                                                                    |
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| Listing:             |   | The  corporation shall make all efforts to list on the TSX Venture Exchange within  3 months of closing.                                                                                                                                                                                                                                                                                                                                                                                                           |
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| Termination:         |   | This agreement shall terminate at  5:00 pm (Toronto Time) on March 31, 2005, unless this agreement is  extended by the mutual agreement of the parties.                                                                                                                                                                                                                                                                                                                                                       |
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| Indemnity:           |   | In consideration of the Agent  entering into this letter of engagement, the Company shall indemnify the  Agent(s) in accordance with the terms of Schedule “A” hereto, which  schedule forms part of this letter of engagement. This indemnity shall  be in addition to, and not in substitution of, any other liabilities the  Corporation may have to the Agent. The indemnity will apply to all services  provided by the Agent in connection with, or otherwise related to, the  Offering. |

 

ConditionsPrecedent:

 

Theabove Offering is subject, but not limited to, the following:

 

a)                                      completion of due diligence to the satisfaction of theAgent and its legal counsel;

 

b)                                     execution of a standard form agency agreement andSponsorship Agreement between the Corporation and the Agent; and

 

c)                                      approval of the terms and conditions of the Offering byall of the appropriate regulatory authorities.

 

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We wouldask that you if the foregoing is in accordance with your understanding and isagreed to by yourself, that you kindly confirm your acceptance by enclosing theduplicate copy and returning same to the undersigned as soon as possible.

 

 
| Yours very truly,                                                                |
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|                                                                             |
| DOMINICK &  DOMINICK SECURITIES INC.                                    |
|                                                                             |
| /s/ P.  Margolis                                                                 |   |
| P.  Margolis                                                                     |
|                                                                             |
|                                                                             |
| Agreed  and accepted this 2nd day of February, 2005. POLAR MOLECULAR CORPORATION |
|                                                                             |
| /s/ Mark L. Nelson                                                               |   |
| Mark L. Nelson                                                                   |
|                                                                                  |  |  |

 

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Schedule “A”Form of Indemnity

 

Inconsideration for Dominick and Dominick Securities Inc. (the “Agent”) (and anyother agent in a selling syndicate, with the Agent and members of a sellingsyndicate referred to collectively as the “Agents”) accepting the engagement(the “Engagement”) described in the letter of engagement (the “Letter ofEngagement”) to which this Schedule “A” is attached, Polar MolecularHolding Corporation (the “Corporation”) agrees to indemnify and save theAgent(s) and its or their respective affiliates, directors, officers,employees, partners, agents, advisors and shareholders (collectively, the “IndemnifiedParties” and individually, an “Indemnified Party”) from and against any and alllosses, claims, actions, suits, proceedings, damages, liabilities or expensesof whatsoever nature or kind (excluding loss of profits), including the aggregateamount paid in reasonable settlement of any actions, suits, proceedings,investigations or claims and the reasonable fees, disbursements and taxes oftheir counsel in connection with any action, suit, proceeding, investigation orclaim that may be made or threatened against any Indemnified Party or inenforcing this indemnity (collectively, the “Claims”) to which an IndemnifiedParty may become subject or otherwise involved in any capacity insofar as theClaims relate to, are caused by, result from, arise out of or are based upon,directly or indirectly, the Engagement whether performed before or after theCorporation’s execution of the Letter of Engagement and to reimburse eachIndemnified Party forthwith, upon demand, for any legal or other expenses reasonablyincurred by such Indemnified Party in connection with any Claim.

 

TheCorporation also agrees that no Indemnified Party will have any liability(either direct or indirect, in contract or tort or otherwise) to theCorporation or any person asserting claims on the Corporation’s behalf or inright for or in connection with the Engagement, except to the extent that anylosses, expenses, claims, actions, damages or liabilities incurred by theCorporation are determined by a court of competent jurisdiction in a finaljudgment that has become non-appealable to have resulted from the grossnegligence or willful misconduct of such Indemnified Party.

 

Inthe event and to the extent that a court of competent jurisdiction in a final judgmentthat has become non-appealable determines that an Indemnified Party was grosslynegligent or guilty of willful misconduct in connection with a Claim in respectof which the Corporation has advanced funds to the Indemnified Party pursuantto this indemnity, such Indemnified Party will reimburse such funds to theCorporation and thereafter this indemnity will not apply to such IndemnifiedParty in respect of such Claim. The Corporation agrees to waive any right theCorporation might have of first requiring the Indemnified Party to proceedagainst or enforce any other right, power, remedy or security or claim paymentfrom any other person before claiming under this indemnity.

 

Incase any action, suit, proceeding or claim is brought against an IndemnifiedParty or an Indemnified Party has received notice of the commencement of anyinvestigation in respect of which indemnity may be sought against theCorporation, the Indemnified Party will give the Corporation prompt writtennotice of any such action, suit, proceeding, claim or investigation of whichthe Indemnified Party has knowledge and the Corporation will undertake theinvestigation and defense thereof on behalf of the Indemnified Party, includingthe prompt employment of counsel acceptable to the Indemnified Parties affectedand the payment of all expenses. Failure by the Indemnified Party to so notifywill not relieve the Corporation of its obligation of indemnification hereunderunless (and only to the extent that) such failure results in forfeiture by theCorporation of substantive rights or defenses.

 

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No admission ofliability and no settlement, compromise or termination of any action, suit,proceeding, claim, or investigation will be made without the Corporation’sconsent and the consent of the Indemnified Parties affected, such consents notto be unreasonably withheld. Notwithstanding that the Corporation willundertake the investigation and defense of any Claim, an Indemnified Party willhave the right to employ separate counsel with respect to any Claim andparticipate in the defense thereof, but the fees and expenses of such counselwill be at the expense of the Indemnified Party unless:

 

(a)                                  employment of such counsel has been authorized inwriting by the Corporation;

 

(b)                                 the Corporation has not assumed the defense of theaction within a reasonable period of time after receiving notice of the claim;

 

(c)                                  the named parties to any such claim include both theCorporation and the Indemnified Party and the Indemnified Party will have beenadvised by counsel to the Indemnified Party that there may be a conflict ofinterest between the Corporation and the Indemnified Party; or

 

(d)                                 there are one or more defenses available to theIndemnified Party which are different from or in addition to those available tothe Corporation;

 

inwhich case such fees and expenses of such counsel to the Indemnified Party willbe for the Corporation’s account. The rights accorded to the IndemnifiedParties hereunder will be in addition to any rights an Indemnified Party mayhave at common law or otherwise.

 

Iffor any reason the foregoing indemnification is unavailable (other than inaccordance with the terms hereof) to the Indemnified Parties (or any of them)or is insufficient to hold them harmless, the Corporation will contribute tothe amount paid or payable by the Indemnified Parties as a result of suchClaims in such proportion as is appropriate to reflect not only the relativebenefits received by the Corporation or the Corporation’s shareholders on theone hand and the Indemnified Parties on the other, but also the relative faultof the parties and other equitable considerations which may be relevant.Notwithstanding the foregoing, the Corporation will in any event contribute tothe amount paid or payable by the Indemnified Parties as a result of such Claimany amount in excess of the fees actually received by the Indemnified Partieshereunder.

 

TheCorporation hereby constitutes Dominick as trustee for each of the otherIndemnified Parties of the Corporation’s covenants under this indemnity withrespect to such persons and Dominick agrees to accept such trust and to holdand enforce such covenants on behalf of such persons.

 

TheCorporation agrees to reimburse the Agent(s) monthly for the time spent by theAgent(s)’ personnel in connection with any Claim at their normal per diemrates. The Corporation also agrees that if any action, suit, proceeding orclaim is brought against, or an investigation commenced in respect of theCorporation or the Corporation and the Agent(s) and personnel of either of theAgent(s) are required to testify, participate or respond in respect of or inconnection with the Engagement, such Agent(s) will have the right to employ itsown counsel in connection therewith and the Corporation will reimburse suchAgent(s) monthly for the time spent by its personnel in connection therewith attheir normal per diem rates together with such disbursements and reasonableout-of-pocket expenses as may be incurred, including fees and disbursements ofsuch Agent(s)’ counsel.

 

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