Document:

EXHIBIT
10.5

 

STOCK PLEDGE AGREEMENT

 

This Stock Pledge
Agreement (this “Agreement”), dated as of July 31, 2008 among LV
ADMINISTRATIVE SERVICES INC., as administrative and collateral agent for the
Creditor Parties (as defined below) (the “Pledgee”), MICRO COMPONENT
TECHNOLOGY, INC., a Minnesota company (the “Company”), and each of the
other undersigned parties (the Company and each such other undersigned party, a
“Pledgor” and collectively, the “Pledgors”).

 

BACKGROUND

 

The Company has entered
into a Securities Purchase Agreement, dated as of the date hereof (as amended,
modified, restated or supplemented from time to time, the “Securities
Purchase Agreement”), pursuant to which the Pledgee and the other Creditor
Parties (as defined in the Securities Purchase Agreement) party thereto provide
or will provide certain financial accommodations to the Company and certain
subsidiaries of the Company.

 

In order to induce the
Pledgee and the other Creditor Parties to provide or continue to provide the
financial accommodations described in the Securities Purchase Agreement, each
Pledgor has agreed to pledge and grant a security interest in the collateral
described herein to the Pledgee on the terms and conditions set forth herein.

 

NOW, THEREFORE, in
consideration of the premises and for other good and valuable consideration the
receipt of which is hereby acknowledged, the parties hereto agree as follows:

 

Defined Terms. 
All capitalized terms used herein which are not defined shall have the
meanings given to them in the Securities Purchase Agreement.

 

Pledge and Grant of
Security Interest.  To secure the full and punctual payment and
performance of (the following clauses (a) and (b), collectively, the “Obligations”)
(a) all obligations owing to Pledgee and the other Creditor Parties under
the Securities Purchase Agreement and the Related Agreements referred to in the
Securities Purchase Agreement (the Securities Purchase Agreement and the
Related Agreements, as each may be amended, restated, modified and/or
supplemented from time to time, collectively, the “Documents”) and (b) all
other obligations and liabilities of each Pledgor to the Pledgee and the other
Creditor Parties whether now existing or hereafter arising, direct or indirect,
liquidated or unliquidated, absolute or contingent, due or not due and whether
under, pursuant to or evidenced by a note, agreement, guaranty, instrument or
otherwise (in each case, irrespective of the genuineness, validity, regularity
or enforceability of such Obligations, or of any instrument evidencing any of
the Obligations or of any collateral therefor or of the existence or extent of
such collateral, and irrespective of the allowability, allowance or
disallowance of any or all of such in any case commenced by or against any
Pledgor under Title 11, United States Code, including, without limitation,
obligations of each Pledgor for post-petition interest, fees, costs and charges
that would have accrued or been added to the Obligations but for the
commencement of such case), each Pledgor hereby pledges, assigns, 

 

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hypothecates, transfers and grants a security interest to the Pledgee,
for the ratable benefit of the Creditor Parties, in all of the following (the “Collateral”):
the shares of stock or other equity interests set forth on Schedule A
annexed hereto and expressly made a part hereof (together with any additional
shares of stock or other equity interests acquired by any Pledgor, the “Pledged
Stock”), the certificates representing the Pledged Stock and all dividends,
cash, instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of the Pledged Stock; all additional shares of stock or other equity interests
of any issuer (each, an “Issuer”) of the Pledged Stock from time to time
acquired by any Pledgor in any manner, including, without limitation, stock
dividends or a distribution in connection with any increase or reduction of
capital, reclassification, merger, consolidation, sale of assets, combination
of shares, stock split, spin-off or split-off (which shares shall be deemed to
be part of the Collateral), and the certificates representing such additional
shares, and all dividends, cash, instruments and other property or proceeds
from time to time received, receivable or otherwise distributed in respect of
or in exchange for any or all of such shares; and all options and rights,
whether as an addition to, in substitution of or in exchange for any shares of
any Pledged Stock and all dividends, cash, instruments and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all such options and rights.

 

Delivery of Collateral.  All certificates representing or evidencing
the Pledged Stock shall be delivered to and held by or on behalf of Pledgee
pursuant hereto and shall be accompanied by duly executed instruments of
transfer or assignments in blank, all in form and substance satisfactory to the
Pledgee.  Each Pledgor hereby authorizes
the Issuer upon demand by the Pledgee to deliver any certificates, instruments
or other distributions issued in connection with the Collateral directly to the
Pledgee, in each case to be held by the Pledgee, subject to the terms
hereof.  Upon the occurrence and during
the continuance of an Event of Default (as defined below), the Pledgee shall
have the right, during such time in its discretion and without notice to the
Pledgor, to transfer to or to register in the name of the Pledgee or any of its
nominees any or all of the Pledged Stock. 
In addition, the Pledgee shall have the right at such time to exchange
certificates or instruments representing or evidencing Pledged Stock for
certificates or instruments of smaller or larger denominations.

 

Representations and Warranties of each Pledgor.  Each Pledgor jointly and severally represents
and warrants to the Pledgee (which representations and warranties shall be
deemed to continue to be made until all of the Obligations have been paid in
full in cash and each Document and each agreement and instrument entered into
in connection therewith has been irrevocably terminated) that: the execution,
delivery and performance by each Pledgor of this Agreement and the pledge of
the Collateral hereunder do not and will not result in any violation of any
agreement, indenture, instrument, license, judgment, decree, order, law,
statute, ordinance or other governmental rule or regulation applicable to
any Pledgor; this Agreement constitutes the legal, valid, and binding
obligation of each Pledgor enforceable against each Pledgor in accordance with
its terms; (i) all Pledged Stock owned by each Pledgor is set forth on Schedule
A hereto and (ii) each Pledgor is the direct and beneficial owner of
each share of the Pledged Stock;

 

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all of the shares of the Pledged Stock have been duly authorized,
validly issued and are fully paid and non-assessable; no consent or approval of
any person, corporation, governmental body, regulatory authority or other
entity, is or will be necessary for (i) the execution, delivery and
performance of this Agreement, (ii) the exercise by the Pledgee of any
rights with respect to the Collateral or (iii) the pledge and assignment
of, and the grant of a security interest in, the Collateral hereunder; there
are no pending or, to the best of Pledgor’s knowledge, threatened actions or
proceedings before any court, judicial body, administrative agency or arbitrator
which may materially adversely affect the Collateral; each Pledgor has the
requisite power and authority to enter into this Agreement and to pledge and
assign the Collateral to the Pledgee, for the ratable benefit of the Creditor
Parties, in accordance with the terms of this Agreement; each Pledgor owns each
item of the Collateral and, except for the pledge and security interest granted
to the Pledgee hereunder, the Collateral shall be, immediately following the
closing of the transactions contemplated by the Documents, free and clear of
any other security interest, mortgage, pledge, claim, lien, charge,
hypothecation, assignment, offset or encumbrance whatsoever (collectively, “Liens”);
there are no restrictions on transfer of the Pledged Stock contained in the
certificate of incorporation or by-laws (or equivalent organizational
documents) of the Issuer or otherwise which have not otherwise been enforceably
and legally waived by the necessary parties; none of the Pledged Stock has been
issued or transferred in violation of the securities registration, securities
disclosure or similar laws of any jurisdiction to which such issuance or
transfer may be subject; the pledge and assignment of the Collateral and the
grant of a security interest under this Agreement vest in the Pledgee, for the
ratable benefit of the Creditor Parties, all rights of each Pledgor in the
Collateral as contemplated by this Agreement; and except as noted on Schedule
A, the Pledged Stock constitutes one hundred percent (100%) of the issued and
outstanding shares of capital stock of each Issuer.

 

Covenants.  Each Pledgor jointly and severally covenants
that, until the Obligations shall be indefeasibly satisfied in full in cash and
each Document and each agreement and instrument entered into in connection
therewith is irrevocably terminated: No Pledgor will sell, assign, transfer,
convey, or otherwise dispose of its rights in or to the Collateral or any
interest therein; nor will any Pledgor create, incur or permit to exist any
Lien whatsoever with respect to any of the Collateral or the proceeds thereof
other than that created hereby. Each Pledgor will, at its expense, defend the
Pledgee’s right, title and security interest in and to the Collateral against
the claims of any other party. Each Pledgor shall at any time, and from time to
time, upon the written request of the Pledgee, execute and deliver such further
documents and do such further acts and things as the Pledgee may reasonably
request in order to effectuate the purposes of this Agreement including, but
without limitation, delivering to the Pledgee, upon the occurrence of an Event
of Default, irrevocable proxies in respect of the Collateral in form
satisfactory to the Pledgee.  Until receipt
thereof, upon an Event of Default that has occurred and is continuing beyond
any applicable grace period, this Agreement shall constitute the Pledgor’s
proxy to the Pledgee or its nominee to vote all shares of Collateral then
registered in each Pledgor’s name.

 

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No Pledgor will consent to or approve the issuance of (i) any
additional shares of any class of capital stock or other equity interests of
the Issuer; or (ii) any securities convertible either voluntarily by the
holder thereof or automatically upon the occurrence or nonoccurrence of any
event or condition into, or any securities exchangeable for, any such shares,
unless, in either case, such shares are pledged as Collateral pursuant to this
Agreement. Each Pledgor agrees to execute and deliver to each Issuer that is a
limited liability company or a limited partnership a control acknowledgment (“Control
Acknowledgement”) substantially in the form of Exhibit A hereto.  Each Pledgor shall cause each such Issuer to
acknowledge in writing its receipt and acceptance thereof. Such Control
Acknowledgement shall instruct such Issuer to follow instructions from the
Pledgee without any Pledgor’s consultation or consent.

 

Voting Rights and
Dividends.  In addition to the Pledgee’s rights and
remedies set forth in Section 8 hereof, in case an Event of Default shall
have occurred and be continuing, beyond any applicable cure period, the Pledgee
shall (i) be entitled to vote the Collateral, (ii) be entitled to
give consents, waivers and ratifications in respect of the Collateral (each
Pledgor hereby irrevocably constituting and appointing the Pledgee, with full
power of substitution, the proxy and attorney-in-fact of each Pledgor for such
purposes) and (iii) be entitled to collect and receive for its own use
cash dividends paid on the Collateral. 
Unless and until there shall have occurred and be continuing an Event of
Default, each Pledgor shall be permitted to exercise or refrain from exercising
any voting rights or other powers; provided that, in each case, no vote shall
be cast or any consent, waiver or ratification given or any action taken or
omitted to be taken if, in the reasonable judgment of the Pledgee, such action
would have a material adverse effect on the value of the Collateral or any part
thereof; and, provided, further, that each Pledgor shall give at
least five (5) days’ written notice of the manner in which such Pledgor
intends to exercise, or the reasons for refraining from exercising, any voting
rights or other powers other than with respect to any election of directors and
voting with respect to any incidental matters. 
Following the occurrence of an Event of Default, all rights of each
Pledgor to vote and to give consents, waivers and ratifications shall cease and
all dividends and all other distributions in respect of any of the Collateral,
shall be delivered to the Pledgee to hold as Collateral and shall, if received
by any Pledgor, be received in trust for the benefit of the Pledgee, be
segregated from the other property or funds of any other Pledgor, and be
forthwith delivered to the Pledgee as Collateral in the same form as so
received (with any necessary endorsement).

 

Event of Default.  An “Event of Default” under this
Agreement shall occur upon the happening of any of the following events: An “Event
of Default” under any Document or any agreement or note related to any
Document shall have occurred and be continuing beyond any applicable cure
period; Any Pledgor shall default in the performance of any of its obligations
under any Document, including, without limitation, this Agreement, and such
default shall not be cured during the cure period applicable thereto; Any
representation or warranty of any Pledgor made herein, in any Document or in
any agreement, statement or certificate given in writing pursuant hereto or
thereto or in connection herewith or therewith shall be false or misleading in
any material respect; Any portion of the Collateral is subjected to a levy of
execution, attachment, distraint or other judicial process or any portion of
the Collateral is the subject of a claim (other than by the Pledgee) of a Lien
or other right or interest in or to the Collateral and such levy or claim shall
not 

 

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be cured, disputed or stayed within a period of fifteen (15) business
days after the occurrence thereof; or Any Pledgor shall (i) apply for,
consent to, or suffer to exist the appointment of, or the taking of possession
by, a receiver, custodian, trustee, liquidator or other fiduciary of itself or
of all or a substantial part of its property, (ii) make a general
assignment for the benefit of creditors, (iii) commence a voluntary case
under any state or federal bankruptcy laws (as now or hereafter in effect), (iv) be
adjudicated a bankrupt or insolvent, (v) file a petition seeking to take
advantage of any other law providing for the relief of debtors, (vi) acquiesce
to, or fail to have dismissed, within thirty (30) days, any petition filed
against it in any involuntary case under such bankruptcy laws, or (vii) take
any action for the purpose of effecting any of the foregoing.

 

Remedies.  In case an Event of Default shall have
occurred and is continuing, the Pledgee may: Transfer any or all of the
Collateral into its name, or into the name of its nominee or nominees; Exercise
all corporate rights with respect to the Collateral including, without
limitation, all rights of conversion, exchange, subscription or any other
rights, privileges or options pertaining to any shares of the Collateral as if
it were the absolute owner thereof, including, but without limitation, the
right to exchange, at its discretion, any or all of the Collateral upon the
merger, consolidation, reorganization, recapitalization or other readjustment
of the Issuer thereof, or upon the exercise by the Issuer of any right,
privilege or option pertaining to any of the Collateral, and, in connection
therewith, to deposit and deliver any and all of the Collateral with any
committee, depository, transfer agent, registrar or other designated agent upon
such terms and conditions as it may determine, all without liability except to
account for property actually received by it; and Subject to any requirement of
applicable law, sell, assign and deliver the whole or, from time to time, any
part of the Collateral at the time held by the Pledgee, at any private sale or
at public auction, with or without demand, advertisement or notice of the time
or place of sale or adjournment thereof or otherwise (all of which are hereby
waived, except such notice as is required by applicable law and cannot be
waived), for cash or credit or for other property for immediate or future
delivery, and for such price or prices and on such terms as the Pledgee in its
sole discretion may determine, or as may be required by applicable law.

 

Each Pledgor hereby waives and releases any and all
right or equity of redemption, whether before or after sale hereunder.  At any such sale, unless prohibited by
applicable law, the Pledgee may bid for and purchase the whole or any part of
the Collateral so sold free from any such right or equity of redemption.  All moneys received by the Pledgee hereunder,
whether upon sale of the Collateral or any part thereof or otherwise, shall be
held by the Pledgee and applied by it as provided in Section 10
hereof.  No failure or delay on the part
of the Pledgee in exercising any rights hereunder shall operate as a waiver of
any such rights nor shall any single or partial exercise of any such rights
preclude any other or future exercise thereof or the exercise of any other
rights hereunder.  The Pledgee shall have
no duty as to the collection or protection of the Collateral or any income
thereon nor any duty as to preservation of any rights pertaining thereto,
except to apply the funds in accordance with the requirements of Section 10
hereof.  The Pledgee may exercise its
rights with respect to property held hereunder without resort to other security
for or sources of reimbursement for the Obligations.  In addition to the foregoing, Pledgee shall
have all of the rights, remedies and privileges of a secured party under the
Uniform Commercial Code of New York (the “UCC”) regardless of the
jurisdiction in which enforcement hereof is sought.

 

5

 

Private Sale. 
Each Pledgor recognizes that the Pledgee may be unable to effect (or to
do so only after delay which would adversely affect the value that might be
realized from the Collateral) a public sale of all or part of the Collateral by
reason of certain prohibitions contained in the Securities Act, and may be
compelled to resort to one or more private sales to a restricted group of
purchasers who will be obliged to agree, among other things, to acquire such
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof.  Each
Pledgor agrees that any such private sale may be at prices and on terms less
favorable to the seller than if sold at public sales and that such private
sales shall be deemed to have been made in a commercially reasonable
manner.  Each Pledgor agrees that the
Pledgee has no obligation to delay sale of any Collateral for the period of
time necessary to permit the Issuer to register the Collateral for public sale
under the Securities Act.

 

Proceeds of Sale. 
The proceeds of any collection, recovery, receipt, appropriation,
realization or sale of the Collateral shall be applied by the Pledgee as
follows:

 

First, to the payment of
all costs, reasonable expenses and charges of the Pledgee and to the
reimbursement of the Pledgee for the prior payment of such costs, reasonable
expenses and charges incurred in connection with the care and safekeeping of
the Collateral (including, without limitation, the reasonable expenses of any
sale or any other disposition of any of the Collateral), attorneys’ fees and
reasonable expenses, court costs, any other fees or expenses incurred or
expenditures or advances made by the Pledgee in the protection, enforcement or
exercise of its rights, powers or remedies hereunder;

 

Second, to the payment of the Obligations, in whole or in part, in such
order as the Pledgee may elect, whether or not such Obligations are then due; Third,
to such persons, firms, corporations or other entities as required by
applicable law including, without limitation, Section 9-615(a)(3) of
the UCC; and Fourth, to the extent of any surplus to the Pledgors or as a court
of competent jurisdiction may direct.

 

In the event that the proceeds of any collection,
recovery, receipt, appropriation, realization or sale are insufficient to
satisfy the Obligations, each Pledgor shall be jointly and severally liable for
the deficiency plus the costs and fees of any attorneys employed by the Pledgee
to collect such deficiency.

 

Waiver of Marshaling. 
Each Pledgor hereby waives any right to compel any marshaling of any of
the Collateral.

 

No Waiver. 
Any and all of the Pledgee’s rights with respect to the Liens granted
under this Agreement shall continue unimpaired, and Pledgor shall be and remain
obligated in accordance with the terms hereof, notwithstanding (a) the
bankruptcy, insolvency or reorganization of any Pledgor, (b) the release
or substitution of any item of the Collateral at any time, or of any rights or
interests therein, or (c) any delay, extension of time, renewal,
compromise or other indulgence granted by the Pledgee in reference to any of
the Obligations.  Each Pledgor hereby
waives all notice of any such delay, extension, release, substitution, renewal,
compromise or other indulgence, and hereby consents to be bound hereby as fully
and effectively as if such Pledgor had expressly agreed thereto in
advance.  No delay or extension of time
by the Pledgee in exercising any power of sale, option or other right or remedy
hereunder, and no failure by the Pledgee to give notice or make demand, shall
constitute a waiver thereof, or limit, impair or 

 

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prejudice the Pledgee’s
right to take any action against any Pledgor or to exercise any other power of
sale, option or any other right or remedy.

 

Expenses. 
The Collateral shall secure, and each Pledgor shall pay to the Pledgee
on demand, from time to time, all reasonable costs and expenses, (including but
not limited to, reasonable attorneys’ fees and costs, taxes, and all transfer,
recording, filing and other charges) of, or incidental to, the custody, care,
transfer, administration of the Collateral or any other collateral, or in any
way relating to the enforcement, protection or preservation of the rights or
remedies of the Pledgee under this Agreement or with respect to any of the
Obligations.

 

The Pledgee Appointed
Attorney-In-Fact and Performance by the Pledgee.  Upon the
occurrence of an Event of Default, each Pledgor hereby irrevocably constitutes
and appoints the Pledgee as such Pledgor’s true and lawful attorney-in-fact,
with full power of substitution, to execute, acknowledge and deliver any
instruments and to do in such Pledgor’s name, place and stead, all such acts,
things and deeds for and on behalf of and in the name of such Pledgor, which
such Pledgor could or might do or which the Pledgee may deem necessary,
desirable or convenient to accomplish the purposes of this Agreement,
including, without limitation, to execute such instruments of assignment or
transfer or orders and to register, convey or otherwise transfer title to the
Collateral into the Pledgee’s name.  Each
Pledgor hereby ratifies and confirms all that said attorney-in-fact may so do
and hereby declares this power of attorney to be coupled with an interest and
irrevocable.  If any Pledgor fails to
perform any agreement herein contained, the Pledgee may itself perform or cause
performance thereof, and any costs and expenses of the Pledgee incurred in
connection therewith shall be paid by the Pledgors as provided in Section 10
hereof.

 

Recapture. 
Notwithstanding anything to the contrary in this Agreement, if the
Pledgee or any other Creditor Party receives any payment or payments on account
of the Obligations, which payment or payments or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver, or any other party under
the United States Bankruptcy Code, as amended, or any other federal or state bankruptcy,
reorganization, moratorium or insolvency law relating to or affecting the
enforcement of creditors’ rights generally, common law or equitable doctrine,
then to the extent of any sum not finally retained by the Pledgee or such other
Creditor Party, each Pledgor’s obligations to the Pledgee and the other
Creditor Parties shall be reinstated and this Agreement shall remain in full
force and effect (or be reinstated) until payment shall have been made to the
Pledgee and the other Creditor Parties, which payment shall be due on demand.

 

Captions. 
All captions in this Agreement are included herein for convenience of
reference only and shall not constitute part of this Agreement for any other
purpose.

 

Miscellaneous.  This
Agreement constitutes the entire and final agreement among the parties with
respect to the subject matter hereof and may not be changed, terminated or
otherwise varied except by a writing duly executed by the parties hereto. No
waiver of any term or condition of this Agreement, whether by delay, omission
or otherwise, shall be effective unless in writing and signed by the party
sought to be charged, and then such waiver shall be effective only in the
specific instance and for the purpose for which given. In the event that any
provision of this Agreement or the application thereof to any Pledgor or any
circumstance in any jurisdiction governing this Agreement shall, to any extent,
be invalid or unenforceable under any applicable statute, regulation, or rule of
law, such provision shall be 

 

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deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform
to such statute, regulation or rule of law, and the remainder of this
Agreement and the application of any such invalid or unenforceable provision to
parties, jurisdictions, or circumstances other than to whom or to which it is
held invalid or unenforceable shall not be affected thereby, nor shall same
affect the validity or enforceability of any other provision of this Agreement.

 

This Agreement shall be
binding upon each Pledgor, and each Pledgor’s successors and assigns, and shall
inure to the benefit of the Pledgee and its successors and assigns for the
ratable benefit of the Creditor Parties.

 

Any notice or other
communication required or permitted pursuant to this Agreement shall be given
in accordance with the Securities Purchase Agreement.

 

THIS AGREEMENT AND THE
OTHER DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

 

EACH PLEDGOR HEREBY
CONSENTS AND AGREES THAT THE STATE AND/OR FEDERAL COURTS LOCATED IN THE COUNTY
OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND
DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY PLEDGOR, ON THE ONE HAND, AND THE
PLEDGEE AND/OR ANY OTHER CREDITOR PARTY, ON THE OTHER HAND, PERTAINING TO THIS
AGREEMENT OR ANY OF THE OTHER DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR ANY OF THE OTHER DOCUMENTS, PROVIDED, THAT
EACH PLEDGOR ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO
BE HEARD BY A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW
YORK; AND FURTHER  PROVIDED, THAT NOTHING IN THIS AGREEMENT SHALL
BE DEEMED OR OPERATE TO PRECLUDE THE PLEDGEE OR ANY OTHER CREDITOR PARTY FROM
BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT
THE INDEBTEDNESS, TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
INDEBTEDNESS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE
PLEDGEE AND/OR ANY OTHER CREDITOR PARTY. 
EACH PLEDGOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH
PLEDGOR HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF
PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM  NON  CONVENIENS.  EACH PLEDGOR HEREBY WAIVES PERSONAL SERVICE
OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT
AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO SUCH PLEDGOR AT THE ADDRESS
SET FORTH IN THE SECURITIES PURCHASE AGREEMENT AND THAT SERVICE SO MADE SHALL
BE DEEMED COMPLETED UPON THE EARLIER OF SUCH PLEDGOR’S ACTUAL RECEIPT THEREOF
OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID.

 

8

 

THE PARTIES HERETO DESIRE
THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO ACHIEVE THE BEST COMBINATION OF
THE BENEFITS OF THE JUDICIAL SYSTEM AND/OR OF ARBITRATION, THE PARTIES HERETO
WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO
RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN
THE PLEDGEE AND/OR ANY OTHER CREDITOR PARTY, ON THE ONE HAND, AND/OR ANY
PLEDGOR, ON THE OTHER HAND, ARISING OUT OF, CONNECTED WITH, RELATED OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS
AGREEMENT, ANY OTHER DOCUMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO.

 

It is understood and
agreed that any person or entity that desires to become a Pledgor hereunder, or
is required to execute a counterpart of this Agreement after the date hereof
pursuant to the requirements of any Document, shall become a Pledgor hereunder
by (x) executing a Joinder Agreement in form and substance satisfactory to
the Pledgee, (y) delivering supplements to such exhibits and annexes to
such Documents as the Pledgee shall reasonably request and/or set forth in such
joinder agreement and (z) taking all actions as specified in this
Agreement as would have been taken by such Pledgor had it been an original
party to this Agreement, in each case with all documents required above to be
delivered to the Pledgee and with all documents and actions required above to
be taken to the reasonable satisfaction of the Pledgee.

 

This Agreement may be
executed in one or more counterparts, each of which shall be deemed an original
and all of which when taken together shall constitute one and the same
agreement.  Any signature delivered by a
party by facsimile or electronic transmission shall be deemed an original
signature hereto.

 

[Remainder
of Page Intentionally Left Blank]

 

9

 

IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the day and year first written
above.

 

 

	
   

  	
  MICRO COMPONENT TECHNOLOGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MCT INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MCT ASIA PTE. LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
										

 

 

	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MCT ASIA (PENANG) SDN. BHD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MCT PHILIPPINES.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BEIJING MCT CO. LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
							

 

 

	
   

  	
  MCT (HONG KONG) LIMITED.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ASECO (MALAYSIA) SDN. BHD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  c/o Micro Component
  Technologies, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota
  55113-2528

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:  (651) 697-4200

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LV ADMINISTRATIVE SERVICES INC.,

  
	
   

  	
  as Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
							

 

 

SCHEDULE
A

 

Pledged
Stock

 

	
  Pledgor

  	
   

  	
  Issuer

  	
   

  	
  Class of 

  Stock

  	
   

  	
  Stock

  Certificate

  Number

  	
   

  	
  Par Value

  	
   

  	
  Number of 

  Shares

  	
   

  	
  % of 

  outstanding 

  Shares

  	
   

  
	
  Micro
  Component Technology, Inc.

  	
   

  	
  MCT
  International, Inc.

  	
   

  	
  Common Stock

  	
   

  	
  2

  	
   

  	
  $

  	
  .01

  	
   

  	
  1,000

  	
   

  	
  100

  	
  %

  
	
  MCT
  International,

   Inc.

  	
   

  	
  MCT Asia 

  Pte. Ltd.

  	
   

  	
  Capital Stock

  	
   

  	
  5-8

  	
   

  	
  $

  	
  1.00

  	
   

  	
  2,587,255

  	
   

  	
  100

  	
  %

  
	
  MCT
  International, 

  Inc.

  	
   

  	
  MCT Asia (Penang) Sdn.
  Bhd.

  	
   

  	
  Common Stock

  	
   

  	
  Unknown

  	
   

  	
  $

  	
  1.00

  	
   

  	
  25,000

  	
   

  	
  100

  	
  %

  
	
  MCT
  International, 

  Inc.

  	
   

  	
  MCT Philippines

  	
   

  	
  Capital Stock

  	
   

  	
  Unknown

  	
   

  	
  $

  	
  Php100.00

  	
   

  	
  99,995

  	
   

  	
  95

  	
  %

  
	
  MCT
  International, 

  Inc.

  	
   

  	
  Beijing MCT Co. Ltd.

  	
   

  	
  Interests

  	
   

  	
  N/A

  	
   

  	
  N/A

  	
   

  	
  85% Interests

  	
   

  	
  85

  	
  %

  
	
  MCT
  International, 

  Inc.

  	
   

  	
  MCT (Hong Kong)

  	
   

  	
  Undesignated

  	
   

  	
  7

  	
   

  	
  $

  	
  1.00

  	
   

  	
  779,999

  	
   

  	
  99.9

  	
  %

  
	
  MCT
  International, 

  Inc.

  	
   

  	
  Aseco (Malaysia) Sdn.
  Bhd.

  	
   

  	
  Unknown

  	
   

  	
  Unknown

  	
   

  	
  Unknown

  	
   

  	
  Unknown

  	
   

  	
  100

  	
  %

  

 

 

EXHIBIT
A

 

FORM OF
CONTROL ACKNOWLEDGMENT

 

Reference is hereby made
to that certain Stock Pledge Agreement, dated as of July 31, 2008 (as
amended, restated, modified and/or supplemented from time to time, the “Pledge
Agreement”), between Micro Component Technologies, Inc. (the “Pledgor”),
the member of
                        ,
a
                      
[limited liability company] [limited partnership] (the “Issuer”), and LV
Administrative Services Inc., as administrative and collateral agent for the
Creditor Parties (as defined therein) (the “Agent”).  Capitalized terms used but not otherwise
defined herein shall have the meanings ascribed thereto in the Pledge
Agreement.

 

The Issuer is hereby
instructed by the Pledgor that all of the Pledgor’s right, title and interest
in and to all of the Pledgor’s rights in connection with any [membership]
[partnership] interests in the Issuer now and hereafter owned by the Pledgor
are subject to a pledge and security interest in favor of the Agent, for the
ratable benefit of the Creditor Parties. 
The Pledgor hereby instructs the Issuer to act upon any instruction
delivered to it by the Agent with respect to the Collateral without seeking
further instruction from the Pledgor, and, by its execution hereof,  the Issuer hereby agrees to do so.

 

The Issuer, by its
written acknowledgment and acceptance hereof, hereby acknowledges receipt of a
copy of the Pledge Agreement and agrees promptly to note on its books the
security interest granted under the Pledge Agreement.  The Issuer also waives any rights or
requirements at any time hereafter to receive a copy of the Pledge Agreement in
connection with the registration of any Collateral in the name of the Agent or
its nominee or the exercise of voting rights by the Agent or its nominee.

 

[Remainder
of this page intentionally left blank]

 

 

 

IN WITNESS WHEREOF, the
Pledgor has caused this Control Acknowledgment to be duly signed and delivered
by its officer duly authorized as of this
           day of
                      
200    .

 

 

	
   

  	
  [PLEDGOR]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

Acknowledged
and accepted this

             day of
                    
200    .

 

[ISSUER]

	
  By:

  	
   

  
	
  Name:

  	
   

  
	
  Title: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:

 

1

 

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.  The word “person” includes an individual,
body corporate, partnership, trustee or trust or unincorporated association,
executor, administrator or legal representative.

 

Waivers
and Amendments.  This Agreement may be amended, modified,
superseded, cancelled, renewed or extended, and the terms and conditions hereof
may be waived, in each case only by a written instrument signed by all parties
hereto, or, in the case of a waiver, by the party waiving compliance.  Except as expressly stated herein, no delay
on the part of any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any waiver on the part of any
party of any right, power or privilege hereunder preclude any other or future
exercise of any other right, power or privilege hereunder.

 

Headings. 
The division of this Agreement into articles, sections, subsections and
paragraphs and the insertion of headings are for convenience of reference only
and shall not affect the construction or interpretation of this Agreement.

 

Law
Governing this Agreement; Consent to Jurisdiction. 
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.  With respect to any suit, action
or proceeding relating to this Agreement or to the transactions contemplated
hereby (“Proceedings”), each party hereto irrevocably submits to the exclusive
jurisdiction of the courts of the County of New York, State of New York and the
United States District court located in the county of New York in the State of
New York.  Each party hereto 

 

2

 

hereby
irrevocably and unconditionally (a) waives trial by jury in any Proceeding
relating to this Agreement and for any related counterclaim and (b) waives
any objection which it may have at any time to the laying of venue of any
Proceeding brought in any such court, waives any claim that such Proceedings
have been brought in an inconvenient forum and further waives the right to
object, with respect to such Proceedings, that such court does not have
jurisdiction over such party.  As between
the Company and the Purchasers, the prevailing party shall be entitled to
recover from the other party its reasonable attorneys’ fees and costs.  In the event that any provision of this
Agreement is determined by a court of competent jurisdiction to be invalid or
unenforceable, then the remainder of this Agreement shall not be affected and
shall remain in full force and effect.

 

Construction. 
Each party acknowledges that its legal counsel participated in the
preparation of this Agreement and, therefore, stipulates that the rule of
construction that ambiguities are to be resolved against the drafting party
shall not be applied in the interpretation of this Agreement to favor any party
against the other.

 

APPOINTMENT OF AND
DELIVERIES TO THE ESCROW AGENT

 

Appointment. 
The Company and the Purchasers hereby irrevocably designate and appoint
the Escrow Agent as their escrow agent for the purposes set forth herein, and
the Escrow Agent by its execution and delivery of this Agreement hereby accepts
such appointment under the terms and conditions set forth herein.

 

Copies
of Documents to Escrow Agent.  On or about
the date hereof, the Creditor Parties and the Company shall deliver to the
Escrow Agent copies of the Documents executed by such parties.

 

Delivery
of Escrowed Payment to Escrow Agent.  Following the
satisfaction of all closing conditions relating to the Documents (other than
the funding of the Escrowed Payment), the Purchasers shall deliver to the
Escrow Agent the Escrowed Payment.  At
such time, the Escrow Agent shall hold the Escrowed Payment as agent for the
Company, subject to the terms and conditions of this Agreement.

 

Intention
to Create Escrow Over the Escrowed Payment.  The
Purchasers and the Company intend that the Escrowed Payment shall be held in
escrow by the Escrow Agent and released from escrow by the Escrow Agent only in
accordance with the terms and conditions of this Agreement.

 

RELEASE OF ESCROW

 

Release
of Escrow.  Subject to the provisions of Section 4.2,
the Escrow Agent shall release the Escrowed Payment from escrow as follows:

 

Upon
receipt by the Escrow Agent of (i) oral instructions from David Grin
and/or Eugene Grin (each of whom is a principal of the Purchasers) consenting
to the release of the Escrowed Payment from escrow in accordance with the
Disbursement Letter following the Escrow Agent’s receipt of the Escrowed
Payment, (ii) the Disbursement Letter, and (iii) the Escrowed Payment,
the Escrowed Payment shall promptly be disbursed in accordance with the
Disbursement Letter.  The Disbursement
Letter shall include, without limitation, Escrow Agent’s authorization to
retain from the Escrowed Payment Escrow Agent’s fee for 

 

3

 

acting
as Escrow Agent hereunder and the Closing Payment for delivery to Valens
Capital Management, LLC in accordance with the Disbursement Letter.

 

Upon
receipt by the Escrow Agent of a final and non-appealable judgment, order,
decree or award of a court of competent jurisdiction (a “Court Order”) relating
to the Escrowed Payment, the Escrow Agent shall remit the Escrowed Payment in
accordance with the Court Order.  Any
Court Order shall be accompanied by an opinion of counsel for the party
presenting the Court Order to the Escrow Agent (which opinion shall be
satisfactory to the Escrow Agent) to the effect that the court issuing the
Court Order is a court of competent jurisdiction and that the Court Order is final
and non-appealable.

 

Acknowledgement
of Company and Purchasers; Disputes.  The Company
and the Purchasers acknowledge that the only terms and conditions upon which
the Escrowed Payment are to be released from escrow are as set forth in
Sections 3 and 4 of this Agreement.  The
Company and the Purchasers reaffirm their agreement to abide by the terms and
conditions of this Agreement with respect to the release of the Escrowed
Payment.  Any dispute with respect to the
release of the Escrowed Payment shall be resolved pursuant to Section 4.2
or by written agreement between the Company and the Purchasers.

 

CONCERNING THE ESCROW
AGENT

 

Duties
and Responsibilities of the Escrow Agent.  The Escrow
Agent’s duties and responsibilities shall be subject to the following terms and
conditions:

 

The
Purchasers and the Company acknowledge and agree that the Escrow Agent (i) shall
not be required to inquire into whether the Creditor Parties, the Company or
any other party is entitled to receipt of any Document or all or any portion of
the Escrowed Payment; (ii) shall not be called upon to construe or review
any Document or any other document, instrument or agreement entered into in
connection therewith; (iii) shall be obligated only for the performance of
such duties as are specifically assumed by the Escrow Agent pursuant to this
Agreement; (iv) may rely on and shall be protected in acting or refraining
from acting upon any written notice, instruction, instrument, statement,
request or document furnished to it hereunder and believed by the Escrow Agent
in good faith to be genuine and to have been signed or presented by the proper
person or party, without being required to determine the authenticity or
correctness of any fact stated therein or the propriety or validity or the
service thereof; (v) may assume that any person purporting to give notice
or make any statement or execute any document in connection with the provisions
hereof has been duly authorized to do so; (vi) shall not be responsible
for the identity, authority or rights of any person, firm or company executing
or delivering or purporting to execute or deliver this Agreement or any
Document or any funds deposited hereunder or any endorsement thereon or
assignment thereof; (vii) shall not be under any duty to give the property
held by Escrow Agent hereunder any greater degree of care than Escrow Agent
gives its own similar property; and (viii) may consult counsel
satisfactory to Escrow Agent (including, without limitation, Loeb &
Loeb LLP or such other counsel of Escrow Agent’s choosing), the opinion of such
counsel to be full and complete authorization and protection in respect of any
action taken, suffered or omitted by Escrow Agent hereunder in good faith and
in accordance with the opinion of such counsel.

 

4

 

The
Purchasers and the Company acknowledge that the Escrow Agent is acting solely
as a stakeholder at their request and that the Escrow Agent shall not be liable
for any action taken by Escrow Agent in good faith and believed by Escrow Agent
to be authorized or within the rights or powers conferred upon Escrow Agent by
this Agreement.  The Purchasers and the
Company hereby, jointly and severally, indemnify and hold harmless the Escrow
Agent and any of Escrow Agent’s partners, employees, agents and representatives
from and against any and all actions taken or omitted to be taken by Escrow
Agent or any of them hereunder and any and all claims, losses, liabilities,
costs, damages and expenses suffered and/or incurred by the Escrow Agent
arising in any manner whatsoever out of the transactions contemplated by this
Agreement and/or any transaction related in any way hereto, including the fees
of outside counsel and other costs and expenses of defending itself against any
claims, losses, liabilities, costs, damages and expenses arising in any manner
whatsoever out the transactions contemplated by this Agreement and/or any
transaction related in any way hereto, except for such claims, losses,
liabilities, costs, damages and expenses incurred by reason of the Escrow Agent’s
gross negligence or willful misconduct. 
The Escrow Agent shall owe a duty only to the Purchasers and the Company
under this Agreement and to no other person.

 

The
Purchasers and the Company shall jointly and severally reimburse the Escrow
Agent for its reasonable out-of-pocket expenses (including counsel fees (which
counsel may be Loeb & Loeb LLP or such other counsel of the Escrow
Agent’s choosing) incurred in connection with the performance of its duties and
responsibilities hereunder, which shall not (subject to Section 4.1(b))
exceed $1,500.

 

The
Escrow Agent may at any time resign as Escrow Agent hereunder by giving five (5) business
days prior written notice of resignation to the Purchasers and the Company.  Prior to the effective date of resignation as
specified in such notice, the Purchasers and Company will issue to the Escrow
Agent a joint instruction authorizing delivery of the Documents and the
Escrowed Payment to a substitute Escrow Agent selected by the Purchasers and
the Company.  If no successor Escrow
Agent is named by the Purchasers and the Company, the Escrow Agent may apply to
a court of competent jurisdiction in the State of New York for appointment of a
successor Escrow Agent, and deposit the Documents and the Escrowed Payment with
the clerk of any such court, and/or otherwise commence an interpleader or
similar action for a determination of where to deposit the same.

 

The
Escrow Agent does not have and will not have any interest in the Documents and
the Escrowed Payment, but is serving only as escrow agent, having only
possession thereof.

 

The
Escrow Agent shall not be liable for any action taken or omitted by it in good
faith and reasonably believed by it to be authorized hereby or within the
rights or powers conferred upon it hereunder, nor for action taken or omitted
by it in good faith, and in accordance with advice of counsel (which counsel
may be Loeb & Loeb LLP or such other counsel of the Escrow Agent’s
choosing), and shall not be liable for any mistake of fact or error of judgment
or for any acts or omissions of any kind except to the extent any such
liability arose from its own willful misconduct or gross negligence.

 

This
Agreement sets forth exclusively the duties of the Escrow Agent with respect to
any and all matters pertinent thereto and no implied duties or obligations
shall be read into this Agreement.

 

5

 

The
Escrow Agent shall be permitted to act as counsel for the Creditor Parties or
the Company, as the case may be, in any dispute as to the disposition of the
Documents and the Escrowed Payment, in any other dispute between the Creditor
Parties and the Company, whether or not the Escrow Agent is then holding the
Documents and/or the Escrowed Payment and continues to act as the Escrow Agent
hereunder.

 

The
provisions of this Section 4.1 shall survive the resignation of the Escrow
Agent or the termination of this Agreement.

 

Dispute
Resolution; Judgments.  Resolution of disputes arising
under this Agreement shall be subject to the following terms and conditions:

 

If
any dispute shall arise with respect to the delivery, ownership, right of
possession or disposition of the Documents and/or the Escrowed Payment, or if
the Escrow Agent shall in good faith be uncertain as to its duties or rights
hereunder, the Escrow Agent shall be authorized, without liability to anyone,
to (i) refrain from taking any action other than to continue to hold the
Documents and the Escrowed Payment pending receipt of a joint instruction from
the Purchasers and the Company, (ii) commence an interpleader or similar
action, suit or proceeding for the resolution of any such dispute; and/or (iii) deposit
the Documents and the Escrowed Payment with any court of competent jurisdiction
in the State of New York, in which event the Escrow Agent shall give written
notice thereof to the Purchasers and the Company and shall thereupon be
relieved and discharged from all further obligations pursuant to this
Agreement.  The Escrow Agent may, but
shall be under no duty to, institute or defend any legal proceedings which
relate to the Documents and the Escrowed Payment.  The Escrow Agent shall have the right to
retain counsel if it becomes involved in any disagreement, dispute or
litigation on account of this Agreement or otherwise determines that it is
necessary to consult counsel which such counsel may be Loeb & Loeb LLP
or such other counsel of the Escrow Agent’s choosing.

 

The
Escrow Agent is hereby expressly authorized to comply with and obey any Court
Order.  In case the Escrow Agent obeys or
complies with a Court Order, the Escrow Agent shall not be liable to the
Creditor Parties, the Company or any other person, firm, company or entity by
reason of such compliance.

 

GENERAL MATTERS

 

Termination. 
This escrow shall terminate upon disbursement of the Escrowed Payment in
accordance with the terms of this Agreement or earlier upon the agreement in
writing of the Purchasers and the Company or resignation of the Escrow Agent in
accordance with the terms hereof.

 

Notices. 
All notices, requests, demands and other communications required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given one (1) day after being sent by telecopy (with copy delivered by
overnight courier, regular or certified mail):

 

	
  If to the Company, to:

  	
   

  	
  Micro Component Technology, Inc.

  
	
   

  	
   

  	
  2340 West County Road C

  
	
   

  	
   

  	
  St. Paul, Minnesota 55113-2528

  
	
   

  	
   

  	
  Attention:Chief Financial Officer

  
	
   

  	
   

  	
  Fax: (651) 697-4200

  

 

6

 

	
  With a copy to:

  	
   

  	
  Best & Flanagan,
  LLP

  
	
   

  	
   

  	
  225 South Sixth St.,
  Suite 4000,

  
	
   

  	
   

  	
  Minneapolis, Minnesota
  55402

  
	
   

  	
   

  	
  Attention: James C.
  Diracles, Esq.

  
	
   

  	
   

  	
  Fax: (612) 339-5897

  
	
   

  	
   

  	
   

  
	
  If to the Purchasers, to:

  	
   

  	
  c/o Valens Capital Management LLC

  
	
   

  	
   

  	
  335 Madison Avenue, 10th Floor

  
	
   

  	
   

  	
  New York, New York 10017

  
	
   

  	
   

  	
  Attention: Portfolio Services

  
	
   

  	
   

  	
  Fax: 212-581-5037

  
	
   

  	
   

  	
   

  
	
  If to the Escrow Agent, to:

  	
   

  	
  Loeb & Loeb LLP

  
	
   

  	
   

  	
  345 Park Avenue

  
	
   

  	
   

  	
  New York, New York 10154

  
	
   

  	
   

  	
  Attention: Scott J. Giordano, Esq.

  
	
   

  	
   

  	
  Fax: (212) 407-4990

  

 

or to
such other address as any of them shall give to the others by notice made
pursuant to this Section 5.2.

 

Interest. 
The Escrowed Payment shall not be held in an interest bearing account
nor will interest be payable in connection therewith.

 

Assignment;
Binding Agreement.  Neither this Agreement nor any right or
obligation hereunder shall be assignable by any party without the prior written
consent of the other parties hereto. 
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective legal representatives, successors and
assigns.

 

Invalidity. 
In the event that any one or more of the provisions contained herein, or
the application thereof in any circumstance, is held invalid, illegal, or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be in any way impaired thereby,
it being intended that all of the rights and privileges of the parties hereto
shall be enforceable to the fullest extent permitted by law.

 

Counterparts/Execution. 
This Agreement may be executed in any number of counterparts and by
different signatories hereto on separate counterparts, each of which, when so
executed, shall be deemed an original, but all such counterparts shall
constitute but one and the same agreement. 
This Agreement may be executed by facsimile or electronic transmission.

 

[Signature Page to Follow]

 

7

 

IN WITNESS WHEREOF, the parties hereto have executed
this Funds Escrow Agreement as of the date and year first above written.

 

 

	
   

  	
  COMPANY:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MICRO COMPONENT TECHNOLOGY, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: 

  	
  Roger E. Gower

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PURCHASERS:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  VALENS U.S. SPV I, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  Valens Capital Management,

  
	
   

  	
   

  	
  its investment manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  VALENS OFFSHORE SPV I, LTD.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  Valens Capital Management,

  
	
   

  	
   

  	
  its investment manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ESCROW AGENT:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  LOEB & LOEB LLP

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

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