EXHIBIT 10.6
FUNDS ESCROW AGREEMENT
This Funds Escrow Agreement (this "Agreement") is dated as of July 31, 2008
among MICRO COMPONENT TECHNOLOGY, INC., a Minnesota corporation (the "Company"),
Valens U.S. SPV I, LLC and Valens Offshore SPV I, Ltd. (the "Purchasers"), and
Loeb & Loeb LLP (the "Escrow Agent").
W I T N E S S E T H:
WHEREAS, LV Administrative Services, Inc., as administrative and collateral
agent for the Purchasers (the "Agent"), has advised the Escrow Agent that
(a) the Company, the Agent and the Purchasers have entered into a Securities
Purchase Agreement (the "Purchase Agreement") for the sale by the Company to the
Purchasers of secured term notes (the "Term Notes"), and (b) the Company has
issued to the Purchasers common stock purchase warrants (the "Warrants") in
connection with the issuance of the Term Notes;
WHEREAS, the Company and the Purchasers wish to deliver to the Escrow Agent
copies of the Documents (as hereafter defined) and, following the satisfaction
of all closing conditions relating to the Documents, the Purchasers to deliver
the Escrowed Payment (as hereafter defined), in each case, to be held and
released by Escrow Agent in accordance with the terms and conditions of this
Agreement; and
WHEREAS, the Escrow Agent is willing to serve as escrow agent pursuant to the
terms and conditions of this Agreement;
NOW THEREFORE, the parties agree as follows:
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INTERPRETATION
DEFINITIONS.
WHENEVER USED IN THIS AGREEMENT, THE FOLLOWING TERMS SHALL HAVE
THE MEANINGS SET FORTH BELOW.
"AGREEMENT" MEANS THIS AGREEMENT, AS AMENDED, MODIFIED AND/OR SUPPLEMENTED FROM
TIME TO TIME BY WRITTEN AGREEMENT AMONG THE PARTIES HERETO.
"CLOSING PAYMENT" MEANS (A) A NON-REFUNDABLE PAYMENT TO VALENS CAPITAL
MANAGEMENT, LLC, THE INVESTMENT MANAGER OF THE PURCHASERS ("VCM") IN AN AMOUNT
EQUAL TO $70,000.00; (II) A NON-REFUNDABLE PAYMENT TO THE PURCHASERS IN AN
AMOUNT EQUAL TO $35,000.00; (III) AN ADVANCE PREPAYMENT DISCOUNT DEPOSIT TO THE
PURCHASERS IN AN AMOUNT EQUAL TO $35,000.00; AND (IV) A NON-REFUNDABLE
STRUCTURING PAYMENT TO VCM IN AN AMOUNT EQUAL TO $30,000.00.
"CREDITOR PARTIES" MEANS COLLECTIVELY, THE AGENT AND THE PURCHASERS.
"DISBURSEMENT LETTER" MEANS THAT CERTAIN LETTER DELIVERED TO THE ESCROW AGENT BY
THE COMPANY, ACCEPTABLE IN FORM AND SUBSTANCE TO THE AGENT, SETTING FORTH WIRE
INSTRUCTIONS AND AMOUNTS TO BE FUNDED AT THE CLOSING.
"DOCUMENTS" MEANS COPIES OF THE DISBURSEMENT LETTER, THE PURCHASE AGREEMENT, THE
TERM NOTES AND THE WARRANTS.
"ESCROWED PAYMENT" MEANS $3,500,000.
ENTIRE AGREEMENT.
THIS AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT AMONG THE
PARTIES HERETO WITH RESPECT TO THE ARRANGEMENT WITH THE ESCROW AGENT AND
SUPERSEDES ALL PRIOR AGREEMENTS, UNDERSTANDINGS, NEGOTIATIONS AND DISCUSSIONS OF
THE PARTIES, WHETHER ORAL OR WRITTEN WITH RESPECT TO THE ARRANGEMENT WITH THE
ESCROW AGENT.
THERE ARE NO WARRANTIES, REPRESENTATIONS AND OTHER AGREEMENTS
MADE BY THE PARTIES IN CONNECTION WITH THE ARRANGEMENT WITH THE ESCROW AGENT
EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT.
EXTENDED MEANINGS.
IN THIS AGREEMENT WORDS IMPORTING THE SINGULAR NUMBER
INCLUDE THE PLURAL AND VICE VERSA; WORDS IMPORTING THE MASCULINE GENDER INCLUDE
THE FEMININE AND NEUTER GENDERS.