-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GYgCWKTEa2wLLTiJB4oTUH2tM/jDaRTivUmeo76eeIECBpW/wvnr4mbCHhKaKQmk YLIcBIOGy2FTC2QXfO4qmg== 0000950131-01-504510.txt : 20020413 0000950131-01-504510.hdr.sgml : 20020413 ACCESSION NUMBER: 0000950131-01-504510 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20011129 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20011214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ENDOREX CORP CENTRAL INDEX KEY: 0000812796 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 411505029 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-16929 FILM NUMBER: 1813768 BUSINESS ADDRESS: STREET 1: 28101 BALLARD DR. CITY: LAKE FOREST STATE: IL ZIP: 60045 BUSINESS PHONE: 847-573-8990 MAIL ADDRESS: STREET 1: 28101 BALLARD DR. CITY: LAKE FOREST STATE: IL ZIP: 60045 FORMER COMPANY: FORMER CONFORMED NAME: IMMUNOTHERAPEUTICS INC DATE OF NAME CHANGE: 19920703 8-K 1 d8k.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): November 29, 2001 ----------------- DOR BioPharma, Inc. - -------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in its Charter) Delaware - -------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 1-14778 41-1505029 - ----------------------------------- ------------------------------------ (Commission File Number) (I.R.S. Employer Identification No.) 28101 Ballard Drive, Suite F, Lake Forest, Illinois 60045 - -------------------------------------------------------------------------------- Address of Principal Executive Offices) (Zip Code) (847) 573-8990 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) Endorex Corporation - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Item 2. Acquisition or Disposition of Assets On November 29, 2001, DOR BioPharma, formerly know as "Endorex Corporation" ("DOR") acquired all of the outstanding capital stock of Corporate Technology Development, Inc., a Delaware corporation ("CTD"), pursuant to an Agreement and Plan of Merger and Reorganization dated as of July 31, 2001, as amended on November 29, 2001 (as amended, the "Merger Agreement"), by and among Endorex, CTD and Roadrunner Acquisition, Inc., a wholly owned subsidiary of DOR ("Merger Sub"). Pursuant to the terms of the Merger Agreement, Merger Sub was merged with and into CTD (the "Merger"), with CTD becoming a wholly owned subsidiary of DOR. CTD is a development stage pharmaceutical company which uses its tangible and intangible assets, consisting primarily of intellectual property, licenses, and patents, to develop, through its subsidiaries, new oral and mucosal formulations and new therapeutic indications of drugs that previously have been approved by the U.S. Food and Drug Administration for marketing in the United States. Some of the assets of CTD consisted of cash, a lease of real property and personal property used in CTD's business. DOR intends to continue to use those assets in CTD's business. In consideration for the purchase of the outstanding securities of CTD, DOR will issue (i) approximately 9,050,544 shares of its common stock to holders of capital stock of CTD, (ii) options to purchase approximately 359,042 shares of its common stock at an exercise price of $0.74 per share to holders of options to acquire CTD common stock, (iii) warrants to purchase approximately 207,070 shares of its common stock at an exercise price of $8.10 per share to holders of warrants to acquire CTD preferred stock, and (iv) approximately 383,334 shares of its common stock as bonus payments to CTD employees. The consideration paid was determined by arms-length negotiations. Steve H. Kanzer is a director of DOR and was the President and Chief Executive Officer and a director of CTD. As of October 15, 2001, Mr. Kanzer beneficially owned 1.92% of Endorex's common stock and 21.0% of CTD's common stock. Mr. Kanzer received a bonus payment of 250,000 shares of DOR common stock as an employee of CTD upon the closing of the Merger. Mr. Kanzer serves on the board of directors of DOR as a designee of Aries Select, Ltd. ("Aries") and Aries Select I LLC ("Aries I"), each of which is a principal stockholder of DOR. Aries Select II LLC is also a stockholder of DOR ("Aries II"). Paramount Capital Asset Management, Inc. ("PCAM") is the investment manager of Aries and the managing member of each of Aries I and Aries II. Lindsay A. Rosenwald, M.D. is the Chairman and sole stockholder of PCAM and Paramount Capital, Inc. ("Paramount"). As of October 15, 2001, Dr. Rosenwald beneficially owned 34.0% of Endorex's common stock. Paramount has acted as a placement agent in connection with certain private placements of DOR's common stock, as a finder in connection with a private placement of DOR's common stock and warrants, and as a financial advisor to DOR. In addition, certain officers, employees and associates of Paramount and its affiliates own securities of DOR and a subsidiary of DOR. Dr. Rosenwald is also the Chairman and sole stockholder of Huntington Street Company ("Huntington") and June Street Company ("June Street"), and is the sole member of Paramount Capital Drug Development Holdings LLC ("Paramount Holdings"). Paramount Holdings and Dr. Rosenwald's wife were principal stockholders of CTD. Dr. Rosenwald, Huntington and June Street were also stockholders of CTD. In addition, certain officers, employees and associates of Paramount and its affiliates owned securities of CTD and subsidiaries of CTD. Paramount has also acted as a placement agent in connection with certain private placements of CTD's Series A preferred stock. As of October 15, 2001, Dr. Rosenwald beneficially owned 56.5% of CTD's common stock and 6.0% of CTD's Series A preferred stock. Additionally, as of October 15, 2001, Dr. Rosenwald's wife beneficially owned 8.9% of CTD's common stock. Mr. Peter Kash, an employee of Paramount who as of October 15, 2001 beneficially owned 5.0% of CTD's common stock and was a security holder of DOR, and Mr. Martin Kratchman, an employee of Paramount who was a security holder of both DOR and CTD, will receive options to acquire an aggregate of 100,000 shares of common stock of DOR (the "Options"). Mr. Kash and Mr. Kratchman are receiving the Options as compensation for their financial advisory services to DOR in connection with the Merger. Pursuant to the Escrow Agreement dated November 29, 2001, as amended on November 29, 2001 (as amended, the "Escrow Agreement"), by and among DOR, certain stockholders of CTD, Mr. Peter Kliem, as the representative of such certain CTD stockholders, and Wells Fargo Bank Minnesota, National Association, as escrow agent, 1,350,000 shares of DOR common stock to be issued to the stockholders of CTD in the Merger were deposited into an escrow fund to indemnify DOR for any losses or damages resulting from breaches of the merger agreement by CTD and for other matters specified in the Merger Agreement. Except in limited circumstances, the escrow shares are DOR's exclusive remedy for claims for indemnification and DOR will receive compensation only if its aggregate damages exceed $100,000. On each of March 31, 2002, September 30, 2002 and March 31, 2003, 674,975, 337,502 and 337,523 shares of DOR common stock, respectively, less any shares subject to an indemnification claim or which have been distributed to DOR pursuant to indemnification claims, shall be distributed to the CTD stockholders from the escrow. Each affiliate of CTD has entered into an agreement (collectively, the "Affiliate Agreements") with DOR pursuant to which they each agreed not to sell, assign or transfer their DOR common stock, options and warrants received in connection with the Merger until the date upon which Endorex shall have filed two reports on either Form 10-QSB or 10-KSB with the SEC for any two reporting periods subsequent to the effective date of the merger and thereafter only pursuant to an effective registration statement or an exemption under the Securities Act of 1933, as amended. The foregoing descriptions of the Merger Agreement, the Escrow Agreement, the Affiliate Agreements and the transactions contemplated thereby are qualified by reference to such agreements, which are filed as exhibits hereto. A copy of DOR's press release dated December 3, 2001, regarding the consummation of the Merger is attached hereto as Exhibit 99.1 and is incorporated herein by reference in its entirety. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. - ------- ------------------------------------------------------------------ (a) Financial Statements of Businesses Acquired. The financial statements required by this item have been previously reported by Endorex and are included in the Joint Proxy Statement/Prospectus that forms a part of the Registration Statement on Form S-4 of DOR, as filed with the Securities and Exchange Commission and declared effective on October 23, 2001 and are incorporated by reference herein. (b) Pro Forma Financial Information. The financial statements required by this item have been previously reported by Endorex and are included in the Joint Proxy Statement/Prospectus that forms a part of the Registration Statement on Form S-4 of DOR, as filed with the Securities and Exchange Commission and declared effective on October 23, 2001 and are incorporated by reference herein. (c) Exhibits 2.1 Agreement and Plan of Merger and Reorganization dated as of July 31, 2001 by and among DOR BioPharma, Inc. ("DOR"), Roadrunner Acquisition, Inc. ("Roadrunner") and Corporate Technology Development, Inc. ("CTD") - Incorporated by reference from our Quarterly Report on Form 10-QSB for the fiscal quarter ended June 30, 2001. 2.2 Amendment No. 1 to Agreement and Plan of Merger and Reorganization dated as of November 29, 2001 by and among DOR, Roadrunner and CTD. 10.1 Escrow Agreement dated November 29, 2001 by and among DOR, certain stockholders of CTD, Peter O. Kliem and Wells Fargo Bank Minnesota, National Association ("Wells Fargo"). 10.2 Amendment No. 1 to Escrow Agreement dated November 29, 2001 by and among DOR, Paramount Capital Drug Development Holdings LLC, Peter O. Kliem and Wells Fargo. 10.3 Form of Affiliate Agreement dated as of August 15, 2001 by and between DOR and the affiliates of CTD - Incorporated by reference from our Registration Statement on Form S-4, as amended (File No. 333-70750). 23.1 Consent of Richard A. Eisner & Company, LLP. 99.1 Press Release dated December 3, 2001. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. DOR BioPharma, Inc. ------------------------------------- (Registrant) By: /s/ Colin Bier -------------------------------- Name: Colin Bier Title: Chief Executive Officer Dated: December 14, 2001 EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 2.1 Agreement and Plan of Merger and Reorganization dated as of July 31, 2001 by and among DOR BioPharma, Inc. ("DOR"), Roadrunner Acquisition, Inc. ("Roadrunner") and Corporate Technology Development, Inc. ("CTD") - Incorporated by reference from our Quarterly Report on Form 10-QSB for the fiscal quarter ended June 30, 2001. 2.2 Amendment No. 1 to Agreement and Plan of Merger and Reorganization dated as of November 29, 2001 by and among DOR, Roadrunner and CTD. 10.1 Escrow Agreement dated November 29, 2001 by and among DOR, certain stockholders of CTD, Peter O. Kliem and Wells Fargo Bank Minnesota, National Association ("Wells Fargo"). 10.2 Amendment No. 1 to Escrow Agreement dated November 29, 2001 by and among DOR, Paramount Capital Drug Development Holdings LLC, Peter O. Kliem and Wells Fargo. 10.3 Form of Affiliate Agreement dated as of August 15, 2001 by and between DOR and the affiliates of CTD - Incorporated by reference from our Registration Statement on Form S-4, as amended (File No. 333-70750). 23.1 Consent of Richard A. Eisner & Company, LLP. 99.1 Press Release dated December 3, 2001. EX-2.2 3 dex22.txt AMENDMENT # 1 TO AGREEMENT & PLAN OF MERGER EXHIBIT 2.2 AMENDMENT NO. 1 TO AGREEMENT AND PLAN OF MERGER AND REORGANIZATION This Amendment No. 1 ("Amendment No. 1") to the Agreement and Plan of Merger and Reorganization dated as of July 31, 2001 (the "Agreement") is made and entered into as of November 26, 2001, by and among Endorex Corporation, a Delaware corporation ("Parent"), Roadrunner Acquisition, Inc., a Delaware corporation ("Merger Sub"), and Corporate Technology Development, Inc., a Delaware corporation ("Company"). RECITALS WHEREAS, Parent, Merger Sub and Company have entered into the Agreement; and WHEREAS, Parent, Merger Sub and Company desire to amend certain terms of the Agreement pursuant to Section 9.12 thereof. AGREEMENT NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein and in the Agreement and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows: 1. Sections 3.7, 3.8 and 3.9 of the Parent Disclosure Schedule are hereby amended and restated in their entirety as set forth on Schedule 1 attached hereto. 2. The first sentence of Section 2.3 is hereby amended and restated in its entirety as follows: "Company and each security holder of Company that is not a natural person has all requisite corporate power and authority to execute and deliver this Agreement (if applicable), the Escrow Agreement (if applicable), the Voting Agreement (if applicable), the Affiliate Agreement (if applicable) and any other agreement contemplated hereunder and any amendments to such agreements (the "Transaction Agreements"), to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby." 3. All capitalized terms used but not defined herein have the meanings ascribed to such terms in the Agreement. 4. All terms of the Agreement other than those amended hereby remain in full force and effect. * * * * * IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be executed and delivered by their respective officers thereunto duly authorized, as of the date first written above. PARENT: ENDOREX CORPORATION By: /s/ Michael S. Rosen ----------------------------------------- Name: Michael S. Rosen --------------------------------------- Title: President & Chief Executive Officer --------------------------------------- MERGER SUB: ROADRUNNER ACQUISITION, INC. By: /s/ Michael S. Rosen ----------------------------------------- Name: Michael S. Rosen --------------------------------------- Title: President -------------------------------------- COMPANY: CORPORATE TECHNOLOGY DEVELOPMENT, INC. By: /s/ Steve H. Kanzer ----------------------------------------- Name: Steve H. Kanzer --------------------------------------- Title: President -------------------------------------- EX-10.1 4 dex101.txt ESCROW AGREEMENT DATED 11-29-2001 EXHIBIT 10.1 ESCROW AGREEMENT This Escrow Agreement (the "Agreement") dated November 29, 2001 is by and among Endorex Corporation, a Delaware corporation ("Parent"), the stockholders (the "Stockholders") of Corporate Technology Development, Inc., a Delaware corporation (the "Company"), and Peter O. Kliem, as the representative of the Stockholders (the "Stockholder Representative", and, collectively with Parent and the Stockholders, the "Parties"), and Wells Fargo Bank Minnesota, National Association, a national banking association (the "Escrow Agent"). All capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Merger Agreement (as hereinafter defined). RECITALS WHEREAS, Parent, Roadrunner Acquisition, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent ("Merger Sub"), and the Company have entered into that certain Agreement and Plan of Merger and Reorganization dated as of July 31, 2001 (the "Merger Agreement") pursuant to which Merger Sub will be merged with and into the Company, with the Company becoming a wholly-owned subsidiary of Parent (the "Merger"); and WHEREAS, pursuant to Section 8.2 of the Merger Agreement, the Parties are placing in escrow certain securities and the Escrow Agent is willing to hold and distribute such securities in accordance with the instructions of the Parties, the Escrow Agent and the Parties agree as follows: AGREEMENT ARTICLE 1: Directions 1.1 Escrowed Property: The Parties will deposit with the Escrow Agent the property described in the attached Schedule A (collectively referred to as the ---------- "Escrowed Property"). 1.2 Instructions: The Escrow Agent shall hold, invest, if applicable, and disburse the Escrowed Property pursuant to the instructions set forth in the attached Schedules B and C. ----------------- 1.3 Investments: The Escrow Agent is not responsible or liable for any diminution of principal or any interest penalty on the Escrowed Property, whatsoever, for any reason. 1.4 Assignment of Interest: The assignment, transfer, conveyance or hypothecation of any right, title or interest in and to the Escrowed Property (referred to under this Section 1.4 as the "Assignment") shall be binding upon the Escrow Agent upon delivery of notice to the Escrow Agent of the Assignment and payment to the Escrow Agent of all of its fees in connection with the Assignment; provided that the Escrow Agent has given its written consent to the Assignment, which shall not be unreasonably withheld. ARTICLE 2: Compensation of the Escrow Agent The Parties agree, jointly and severally, to pay the Escrow Agent: a. Its fees, charges, and expenses for all reasonable and necessary services rendered by it in the performance of its obligations under this Agreement as set forth in the attached Schedule D; and ---------- b. With the prior written approval of Parent and the Stockholder Representative, which shall not be unreasonably withheld, reasonable compensation for services rendered in connection with this Agreement but not expressly provided for in this Agreement and reimbursement for those reasonable expenses incurred by the Escrow Agent in rendering such services, including but not limited to court costs and reasonable attorneys' fees incurred in the event of any dispute among the parties to this Agreement. The Escrow Agent shall have first and prior lien upon the Escrowed Property to secure the payments described under paragraphs (a) and (b) of this Article 2. If any such payment is not timely received by the Escrow Agent from the appropriate party or parties, the Parties authorize the Escrow Agent to deduct such payment from the Escrowed Property. ARTICLE 3: Provisions Concerning Escrow Agent 3.1 Authority of Parties: The Escrow Agent shall be under no duty or obligation to ascertain the identity, authority and/or rights of the Parties or their agents. 3.2 Other Agreements: The Escrow Agent is not a party to, or bound by, any agreement between the Parties other than this Agreement, whether or not a copy and/or original of such agreement is held as Escrowed Property. Accordingly, the Escrow Agent shall have no duty to know or determine the performance or nonperformance of any provision of any such agreement between the Parties. 3.3 Deposited Instruments and/or Funds: The Escrow Agent assumes no responsibility for the validity or sufficiency of any instrument held as Escrowed Property, except as expressly and specifically set forth in this Agreement. 3.4 Late Payment or Performance: The Escrow Agent may accept any payment or performance called for under this Agreement after the date such payment or performance is due, unless subsequent to such date, but prior to the actual date of payment or performance, the Escrow Agent is instructed in writing by the Parties not to accept such payment or performance. 3.5 Escheat: The Parties are aware that Escrowed Property which is abandoned may escheat to the state. The Escrow Agent shall have no liability to the Parties, their respective heirs, legal representatives, successors and assigns should any of the Escrowed Property become escheatable or escheat by operation of law. 3.6 Non-Liability: The Escrow Agent shall not be liable for any act it may do or omit to do as Escrow Agent while acting in good faith and in the exercise of its prudent judgment. Any act done or omitted by the Escrow Agent pursuant to the advice of its attorneys shall be conclusive evidence of such good faith. The Escrow Agent shall have the right to consult with counsel at the reasonable expense of the Parties whenever any question arises concerning this Agreement and shall incur no liability for any delay reasonably required to obtain such advice of counsel. The Escrow Agent shall not be liable for the outlawing of any right permitted or given under the instructions set forth in Schedules B and C and/or in any ----------------- document deposited under this Agreement pursuant to any Statute of Limitations or by reason of laches. The Escrow Agent shall have no further responsibility to any or all of the Parties following a complete distribution of the Escrowed Property pursuant to this Agreement. The Escrow Agent shall not incur any liability with respect to any action taken or omitted to be taken in reliance upon any document, including any written notice or instructions provided for in this Agreement. In performing its obligations hereunder, the Escrow Agent shall be entitled to presume, without inquiry, the due execution and validity and effectiveness of all documents it receives. 3.7 Indemnification: The Parties agree, jointly and severally, to indemnify and hold harmless the Escrow Agent from any liability, or reasonable costs or expenses, including but not limited to reasonable attorneys' fees, incurred by reason of accepting this Agreement and/or Escrowed Property. 3.8 Disagreements: If any disagreement or dispute arises between the Parties to this Agreement concerning the meaning or validity of any provision under this Agreement or concerning any other matter relating to this Agreement, the Escrow Agent: a. Shall be under no obligation to act, except under process or order of court, or until it has been adequately indemnified to its full satisfaction, and shall sustain no liability for its failure to act pending such process or court order or indemnification; and b. May deposit, in its sole and absolute discretion, the Escrowed Property or that portion of the Escrowed Property it then holds with a court of competent jurisdiction, and to interplead the Parties. Upon such deposit and filing of interpleader, the Escrow Agent shall be relieved of all liability as to the Escrowed Property and shall be entitled to recover from the Parties its reasonable attorneys' fees and other reasonable costs incurred in commencing and maintaining such action. The Parties by signing this Agreement submit themselves to the jurisdiction of such court. In no event shall the institution of such interpleader action impair the rights of the Escrow Agent described in Section 3.6 of this Agreement. ARTICLE 4: Representations and Warranties of the Stockholders 4.1 Representations and Warranties of the Stockholders: Each Stockholder hereby represents and warrants to Parent and each other Stockholder as follows: a. Such Stockholder has the legal capacity and right and all other necessary power and authority necessary to enter into this Agreement and any document or instrument to be executed and delivered by Stockholder pursuant hereto or pursuant to the Merger Agreement, including, without limitation, the Voting Agreement and the Affiliate Agreement, if applicable (the "Stockholder Documents"), to perform his/her/its obligations under the Stockholder Documents, and to consummate the transactions contemplated by the Stockholder Documents. b. The execution, delivery and performance of the Stockholder Documents, and the consummation of the transactions contemplated by the Stockholder Documents, will not (i) conflict with or violate any statute, law, ordinance, rule, regulation, judgment, decree, order, injunction, writ, permit or license applicable to such Stockholder or by which any property or asset of such Stockholder is bound or affected, or (ii) constitute a violation of, or a breach or default (or an event which with the giving of notice or lapse of time or both could reasonably be expected to become a default) under, or conflict with, or require any consent under (other than a violation or default that has been waived or a consent that has been obtained), any term or provision of any note, bond, mortgage, instrument, contract, permit, franchise, commitment, indenture, lease, license, or other agreement or obligation to which such Stockholder is a party or by which any property or asset of such Stockholder is bound or affected. c. The Stockholder Documents constitute valid and binding obligations of such Stockholder, enforceable in accordance with their terms, except to the extent that such enforceability may be limited by bankruptcy, insolvency, and similar laws affecting the rights and remedies of creditors generally, and by general principles of equity and public policy; and the Stockholder Documents, when executed and delivered in accordance with the provisions thereof, shall be valid and binding obligations of such Stockholder, enforceable in accordance with their terms (with the aforesaid exceptions). d. As of the Effective Time, such Stockholder (i) will hold of record and beneficially own the number and class of shares of Company capital stock set forth next to such Stockholder's name in Section 2.2 of the Company Disclosure Schedule, free and clear of any restrictions on transfer (other than any restrictions under the Act and state securities laws), taxes, security interests, charges, liens, encumbrances, options, warrants, purchase rights, contracts, commitments, equities, claims, and demands, and (ii) will not be a party to any option, warrant, call, right, purchase right or other contract, commitment or agreement (other than the Merger Agreement) that could require such Stockholder to deliver, sell, transfer or otherwise dispose of any capital stock of the Company or to any voting trust, proxy or other agreement or understanding with respect to the voting of any capital stock of the Company (other than the Voting Agreement, if applicable). 4.2 Representations and Warranties of Non-Individual Stockholders: Each Stockholder that is not a natural person hereby represents and warrants to Parent and to each other Stockholder as follows: a. Such Stockholder is duly organized, validly existing, and in good standing under the laws of the jurisdiction in which it is organized. Such Stockholder has the corporate, partnership, limited liability company or other power and authority to enter into the Stockholder Documents, to perform its obligations under the Stockholder Documents, and to consummate the transactions contemplated by the Stockholder Documents. b. Such Stockholder has taken all corporate, partnership, limited liability company or other action necessary for it to enter into the Stockholder Documents, to perform its obligations under the Stockholder Documents, and to consummate the transactions contemplated by the Stockholder Documents. c. The execution, delivery and performance of the Stockholder Documents, and the consummation of the transactions contemplated by the Stockholder Documents, will not constitute a violation of, or a breach or default under, or conflict with, or require any consent under (other than a violation or default that has been waived or a consent that has been obtained), any term or provision of the certificate or articles of incorporation or bylaws, partnership agreement, certificate or articles of formation, limited liability company agreement or other charter or formation documents of such Stockholder. ARTICLE 5: Additional Agreements of Stockholders 5.1 Release of Parent, Merger Sub, the Company and their Officers and Directors: Each Stockholder, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged and intending to be legally bound, in order to induce Parent and Merger Sub to consummate the Merger and thereby exchange shares of Parent Common Stock for such Stockholder's shares of Company Stock, hereby releases and forever discharges the Company, Merger Sub and Parent and each of their respective individual, joint or mutual, past, present and future agents, directors, officers, employees, consultants, advisors, affiliates, stockholders, controlling persons, subsidiaries, successors and assigns (individually, a "Releasee" and collectively, "Releasees") from any and all claims, demands, causes of action, obligations, debts and liabilities whatsoever, whether known or unknown, suspected or unsuspected, both at law or in equity, which such Stockholder or any of his, her or its affiliates now has, have ever had or may hereafter have against the respective Releasees arising contemporaneously with or prior to the Effective Time or on account of or arising out of any matter, cause or event occurring contemporaneously with or prior to the Effective Time (other than any rights to indemnification or reimbursement from the Company pursuant to its Certificate of Incorporation or Bylaws from former officers and directors of the Company) whether or not relating to claims pending on, or asserted after, the Effective Time; provided, however, that nothing contained herein shall operate to release any obligations of the Company, Merger Sub and Parent or the Stockholders arising under the Merger Agreement. Such Stockholder hereby irrevocably covenants to refrain from, directly or indirectly, asserting any claim or demand, or commencing, instituting or causing to be commenced, any proceeding of any kind against any Releasee, based upon any matter purported to be released hereby. Each Stockholder that is a resident of the State of California expressly waives any and all rights that they may have under any statute or common-law principle that would limit the effect of the releases to those claims actually known or suspected to exist at the time of execution of this Agreement, including but not limited to the provisions of Section 1542 of the California Civil Code, to the extent deemed applicable (notwithstanding that this Agreement does not provide for the application of the California law), which provides as follows: "[a] general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." 5.2 Appointment of Stockholder Representative: The Stockholders hereby appoint the Stockholder Representative as the representative of the Stockholders. The Stockholder Representative shall have full power and authority to represent the Stockholders and their successors and assigns with respect to all matters arising under this Agreement, including, without limitation, the amendment or waiver of any provision of this Agreement, and all action taken by the Stockholder Representative hereunder, pursuant to authority granted herein, shall be binding upon each Stockholder and their successors and assigns as if expressly ratified and confirmed in writing by each of them. Without limiting the generality of the foregoing, the Stockholder Representative shall have full power and authority, on behalf of all the Stockholders and their successors, to interpret all the terms and provisions of this Agreement, to negotiate and compromise any dispute which may arise under this Agreement, to sign any releases or other documents with respect thereto, and to retain such counsel and consultants as appropriate and necessary to carry out his duties under this Agreement. The Stockholder Representative, or any successor hereafter appointed, may resign and shall be discharged of his duties hereunder upon the appointment of a successor Stockholder Representative as hereinafter provided. In case of such resignation, or in the event of the death or inability to act of the Stockholder Representative, a successor shall be named by a majority of the remaining Stockholders. Each such successor Stockholder Representative shall have all the power, authority, rights and privileges hereby conferred upon the original Stockholder Representative, and the term "Stockholder Representative" as used herein shall be deemed to include each such successor Stockholder Representative. The Stockholders shall indemnify and hold harmless the Stockholder Representative from and against any direct or indirect demand, claim, payment, obligation, action or cause of action, assessment, loss, liability, cost or expense, including without limitation, penalties, interest on any amount payable to a third party as a result of the foregoing, and any legal or other expense reasonably incurred in connection with investigating or defending any claim or action, whether or not resulting in any liability, and any amount paid in settlement of any claim or action, incurred in connection with the performance of his duties hereunder, including the advancement of expenses incurred in connection with investigating or defending any claim or action. The Stockholder Representative is authorized to take the actions set forth in this Agreement on behalf of the Stockholders, and Parent and Escrow Agent shall have no liability to the Stockholders for any act or failure to act of the Stockholder Representative. Parent and the Escrow Agent shall be entitled to rely upon any act of the Stockholder Representative as an act of the Stockholders pursuant to this Agreement. ARTICLE 6: General Terms and Conditions 6.1 Extension of Benefits: All of the terms of this Agreement shall be binding upon, and inure to the benefit of, and be enforceable by, the respective heirs, legal representatives, successors and assigns of all of the parties to this Agreement. 6.2 Governing Law: This Agreement shall be construed and enforced in accordance with the laws of the State of Delaware without regard to the law of conflicts thereof. 6.3 Notices: All notices, requests, demands and other communications required under this Agreement shall be in writing and shall be deemed to have been duly given if delivered personally, the next business day if delivered by commercial delivery service or by reputable overnight courier, the third business day if mailed by registered or certified mail (return receipt requested), or the day of transmission if a business day or, if not, the next business day thereafter, if sent via facsimile (with confirmation of receipt) to the parties at the addresses set forth below the signature blocks on the signature pages of this Agreement; provided, however, that all notices, requests, demands and other communications required under this Agreement to be given to any Stockholder shall be given to the Stockholder Representative at the address set forth below the signature block for the Stockholder Representative on the signature pages of this Agreement. It shall be the responsibility of the Parties to notify each other and the Escrow Agent in writing of any name or address changes. This Section 6.3 shall govern this Agreement except as otherwise provided in Section 1 of Schedule B to this Agreement. ---------- 6.4 Entire Agreement: This Agreement sets forth the entire agreement and understanding of the parties to this Agreement with respect to the subject matter hereof. 6.5 Amendment: This Agreement may be amended, modified, superseded, rescinded or canceled only by a written instrument executed by Parent, the Stockholder Representative and the Escrow Agent. 6.6 Waivers: The failure of any party to this Agreement at any time or times to require performance of any provision under this Agreement shall in no manner affect the right at a later time to enforce the same performance. A waiver by any party to this Agreement of any such condition or breach of any term, covenant, representation or warranty contained in this Agreement, in any one or more instances, shall neither be construed as a further or continuing waiver of any such condition or breach nor a waiver of any other condition or breach of any other term, covenant, representation or warranty contained in this Agreement. 6.7 Headings: The headings of the sections of this Agreement have been inserted for convenience of reference only and shall in no way restrict or otherwise modify any of the terms or provisions of this Agreement. 6.8 Counterparts: This Agreement may be executed in one or more counterparts, each of which when executed shall be deemed to be an original, and such counterparts shall together constitute one and the same instrument. 6.9 Resignation or Removal of Escrow Agent: The Escrow Agent may resign at any time by furnishing written notice of its resignation to the Parties. The Parties may remove the Escrow Agent at any time by furnishing to the Escrow Agent a joint written notice of its removal. Such resignation or removal, as the case may be, shall be effective upon delivery of such notice. * * * * * IN WITNESS WHEREOF, the Parties to this Agreement have each caused this Agreement to be duly executed and delivered as of the date first written above. PARENT: ENDOREX CORPORATION /s/ Michael S. Rosen ------------------------------ By: Michael S. Rosen Its: President and Chief Executive Officer Address: Endorex Corporation 28101 Ballard Drive, Suite F Lake Forest, Illinois 60045 Attn: Michael Rosen President Telephone: (847) 573-8990 Fax: (847) 573-9285 with a copy to: Brobeck, Phleger & Harrison, LLP 370 Interlocken Boulevard Fifth Floor Broomfield, Colorado 80021 Attn: Richard R. Plumridge, Esq. Telephone: (303) 410-2000 Fax: (303) 410-2199 STOCKHOLDER REPRESENTATIVE: /s/ Peter O. Kliem --------------------------------- PETER O. KLIEM Address: 750 Main Street Cambridge, MA 02139 Telephone: (617) 621-9575 Facsimile: (617) 621-9574 STOCKHOLDERS: [Signatures of Certain Stockholders of CTD] The Escrow Agent, by affixing its signature below, hereby acknowledges receipt of the Escrowed Property described in Schedule A and agrees to hold, ---------- administer, and dispose of the Escrowed Property in accordance with the terms, conditions, and instructions of this Agreement, including those set forth in Schedules B and C. - ----------------- ESCROW AGENT: WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Escrow Agent /s/ Robert L. Reynolds ----------------------------------- By: Robert L.Reynolds ------------------------------- Title: Vice President ----------------------------- Wells Fargo Bank Minnesota, N.A. 213 Court Street, Suite 902 Middletown, CT 06457 Telephone: (860)-704-6216 Fax: (860) 704-6219 Schedule A Deposits 1,350,000 shares of common stock, $.001 par value per share ("Common Stock"), of Endorex Corporation, a Delaware corporation Schedule B Instructions 1. If Parent requests indemnification from the Stockholders pursuant to its rights under Section 8.4 of the Merger Agreement, then Parent shall notify the Escrow Agent in writing of such request, the number of shares of Common Stock requested for indemnification, the calculation of such number of shares pursuant to Article 8 of the Merger Agreement and disbursement instructions ("Indemnification Notice"). The Escrow Agent shall, within five business days of receipt of an Indemnification Notice, provide a copy of such Indemnification Notice to the Stockholder Representative, and, ten business days after the Stockholder Representative is deemed pursuant to Section 6.3 of this Agreement to have received such Indemnification Notice from the Escrow Agent, disburse to Parent from the Escrowed Property the number of shares of Common Stock requested by Parent in such Indemnification Notice, unless prior to the date of disbursement the Escrow Agent receives written notice from the Stockholder Representative disputing in good faith ("Dispute Notice") Parent's right to all or part of the shares of Common Stock set forth in the Indemnification Notice ("Disputed Shares"). 2. If the Stockholder Representative issues a Dispute Notice pursuant to Section 1 above, then the Escrow Agent shall continue to hold all Disputed Shares until receipt of written instructions jointly executed by Parent and the Stockholder Representative or receipt of an order of any court directing the disbursement of the Disputed Shares, and shall disburse the Disputed Shares in accordance with such joint instructions or court order. 3. On or promptly after March 31, 2002, the Escrow Agent shall disburse to the Stockholder Representative the portion of the Escrowed Property in the names and the amounts set forth under Section 1 of Schedule C, less (i) any Disputed ---------- Shares, which shall be disbursed as provided in Section 2 above, and (ii) any shares set forth in any Indemnification Notice that the Stockholder Representative is deemed pursuant to Section 6.3 of this Agreement to have received no more than ten business days prior to such disbursement and for which the Escrow Agent has not received a Dispute Notice, which amounts shall be disbursed as provided in Section 1 above and, if applicable, Section 2 above (all such shares in clause (i) and (ii) being referred to herein as "Holdback Shares"). Distributions of Escrowed Property for Stockholders pursuant to this Section 3 shall be reduced pro rata among the Stockholders based upon the distribution of Escrowed Property set forth in Section 1 of Schedule C by an ---------- aggregate number of shares equal to the number of Holdback Shares; provided, -------- however, that no fractional shares shall be disbursed for any Stockholder - ------- pursuant to this Section 3 and the Escrow Agent shall make such adjustments in such pro rata reduction as are necessary for the disbursement of only whole shares of the Escrowed Property for any Stockholder. 4. On or promptly after September 30, 2002, the Escrow Agent shall disburse to the Stockholder Representative the portion of the Escrowed Property in the names and the amounts set forth under Section 2 of Schedule C, less any Holdback ---------- Shares, which shall be disbursed as provided in Sections 1 and 2 above, as applicable. For purposes of this Section 4, Holdback Shares shall not include Holdback Shares withheld from disbursement under Section 3. Distributions of Escrowed Property for Stockholders pursuant to this Section 4 shall be reduced pro rata among the Stockholders based upon the distribution of Escrowed Property set forth in Section 2 of Schedule C by an aggregate number of ---------- shares equal to the number of such Holdback Shares; provided, however, that no -------- ------- fractional shares shall be disbursed for any Stockholder pursuant to this Section 4 and the Escrow Agent shall make such adjustments in such pro rata reduction as are necessary for the distribution of only whole shares of the Escrowed Property for any Stockholder. 5. On or promptly after March 31, 2003, the Escrow Agent shall disburse to the Stockholder Representative the portion of the Escrowed Property in the names and the amounts set forth under Section 3 of Schedule C, less any Holdback ---------- Shares, which shall be disbursed as provided in Sections 1 and 2 above, as applicable. For purposes of this Section 5, Holdback Shares shall not include Holdback Shares withheld from disbursement under Sections 3 and 4. Distributions of Escrowed Property for Stockholders pursuant to this Section 5 shall be reduced pro rata among the Stockholders based upon the distribution of Escrowed Property set forth in Section 3 of Schedule C by an aggregate number of shares ---------- equal to the number of such Holdback Shares; provided, however, that no -------- ------- fractional shares shall be disbursed to any Stockholder pursuant to this Section 5 and the Escrow Agent shall make such adjustments in such pro rata reduction as are necessary for the issuance of only whole shares of the Escrowed Property for any Stockholder. 6. Notwithstanding the provisions of Sections 1, 2, 3, 4 or 5 above, if Parent and the Stockholder Representative jointly execute a written notice to the Escrow Agent providing the Escrow Agent with disbursement instructions for all or part of the Escrowed Property, the Escrow Agent shall disburse the portion of the Escrowed Property referred to in such notice in accordance with the instructions contained in such notice. 7. The Stockholders shall have the full and unqualified right and power to exercise any voting, consent and other rights with respect to the Escrowed Property and to cause the Escrow Agent to tender all or part of the Escrowed Property pursuant to a tender offer or exchange offer and neither the Escrow Agent nor Parent shall have any duty, right or privilege to exercise any such rights. The Escrow Agent shall exercise all such rights of the Stockholders as directed by a certificate of the Stockholder Representative. All property received by the Escrow Agent pursuant to a tender offer or exchange offer for the Escrowed Property shall become Escrowed Property. 8. In the event of any transaction wherein dividends, cash or other property which is or will be apportioned to the Escrowed Property are distributed in respect of the Escrowed Property, the Escrow Agent shall take all steps necessary to obtain such cash or other property, including presenting the Escrowed Property for exchange, conversion or other disposition, and the Parties will execute such certificates, instruments or other documents as may be requested by the Escrow Agent of such cash or other property. All such property received by the Escrow Agent shall become Escrowed Property and shall be disbursed with, and to the Party receiving, the Escrowed Property to which such property was apportioned. 9. The Parties hereby authorize the Escrow Agent to apply to the transfer agent for the Common Stock for any division of certificates evidencing Escrowed Property which may be required in connection with the distribution of Escrowed Property pursuant to this Schedule B to the Agreement. ---------- 10. The Escrow Agent shall not, and is not authorized to convey, transfer or distribute the Escrowed Property except as set forth in this Schedule B to ---------- the Agreement. Schedule C Distributions 1. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after March 31, 2002 pursuant to Section 3 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 101,537 Nomura Bank (Switzerland) Ltd. 90,255 Paul Capital Partners V, L.P. 67,120 Imprimus Investors LLC 37,606 Bristol Rittenhouse Investments, L.P. 37,606 Kendall Investments, LLC 18,803 IMS Global Investments X Ltd. 18,803 Richard J. Stern 15,042 Stern Joint Venture, L.P. 15,042 Wolfson Equities 15,042 Lindsay A. Rosenwald, M.D. 13,162 Concordia Partners 11,282 C. Benveniste-Schuler 11,282 Drax Holdings, L.P. 9,401 Bernard Selz 9,401 Michael Steinhardt 9,401 Keys Foundation, Curacro 9,401 Albert Reichmann 7,521 James D. Stern 7,521 Paul Capital Partners V (Domestic Annex Fund) L.P. 5,648 Robert I. Falk 3,760 G&G Enterprises 3,760 Gibert Goldstein, Paul Shapiro, Trustees, UIT Howard Gittis Dated 12/23/88 3,760 Caxton Partners 3,760 Jeffrey S. Silverman 3,760 The Holding Company 3,760 Seju Suzuki 3,760 Cass & Co.Magnum Capital Growth Fund 3,760 Yoshimasa Yamazaki 3,760 Asahi Iron Foundry Co., Ltd. 3,760 Richard Vogel 3,760 Maidenhair Investments, N.V. 3,760 Paul Capital Partners V International, L.P. 2,444 Leonard J. Adams 1,880 Wayne Saker 1,880 Amram Kass P.C. Money Purchase Plan 1,880 David A. Braver 1,880 Amram Kass PC Defined Benefit Pension Plan 1,880 David A. Wolf 1,880 Tis Prager 1,316 Bruno Widmer 1,316 Karen Cook, IRA (KC) 940 Jack Hirschfield 470 Paramount Capital Drug Development Holdings LLC 50,922 Steve H. Kanzer 11,418 Nicholas Bodor 5,061 Kenneth U. Johnson 5,061 Rivki Rosenwald 4,960 Biotechnology Solutions, LLC 3,191 Nicholas Stergiopoulos 1,528 Wayne L. Rubin 1,518 Michael Weiss 1,518 Peter and Donna Kash 1,012 David R. Walner 1,012 Huntington Street Company 1,012
Stockholder Name Number of shares of Common Stock June Street Company 1,012 Rivki Rosenwald Custodian f/b/o Doni Rosenwald 1,012 Rivki Rosenwald Custodian f/b/o Joshy Rosenwald 1,012 Rivki Rosenwald Custodian f/b/o Demi Rosenwald 1,012 Rivki Rosenwald Custodian f/b/o Davy Rosenwald 1,012 Kash Family Foundation 810 Joseph E. Edelman 759 Sarah E. Laut 713 Michael Ferrari 713 Blossom Rosenwald 688 Seth Rosenwald 688 Jon Rosenwald 688 William Kanzer 607 Gary Kanzer 607 Donna Lozito 222 American Friends of Hebron Yeshiva in Jerusalem 202 Fred Mermelstein 202 Lauren S. Fischer 172 John Knox 172 David M. Tanen 172 Evan S. Borak 172 Hope Viggiani 101 Robert Klein 101 Howard Schain 101 John Pappadimitropoulos 50
2. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after September 30, 2002 pursuant to Section 4 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 50,769 Nomura Bank (Switzerland) Ltd. 45,128 Paul Capital Partners V, L.P. 33,560 Imprimus Investors LLC 18,803 Bristol Rittenhouse Investments, L.P. 18,803 Kendall Investments, LLC 9,401 IMS Global Investments X Ltd. 9,401 Richard J. Stern 7,521 Stern Joint Venture, L.P. 7,521 Wolfson Equities 7,521 Lindsay A. Rosenwald, M.D. 6,581 Concordia Partners 5,641 C. Benveniste-Schuler 5,641 Drax Holdings, L.P. 4,701 Bernard Selz 4,701 Michael Steinhardt 4,701 Keys Foundation, Curacro 4,701 Albert Reichmann 3,761 James D. Stern 3,761 Paul Capital Partners V (Domestic Annex Fund) L.P. 2,824 Robert I. Falk 1,880 G&G Enterprises 1,880 Gibert Goldstein, Paul Shapiro, Trustees, UIT Howard Gittis Trust 1,880 Caxton Partners 1,880 Jeffrey S. Silverman 1,880 The Holding Company 1,880 Seju Suzuki 1,880 Cass & Co.Magnum Capital Growth Fund 1,880 Yoshimasa Yamazaki 1,880 Asahi Iron Foundry Co., Ltd. 1,880 Richard Vogel 1,880
Stockholder Name Number of shares of Common Stock Maidenhair Investments, N.V. 1,880 Paul Capital Partners V International, L.P. 1,222 Leonard J. Adams 940 Wayne Saker 940 Amram Kass P.C. Money Purchase Plan 940 David A. Braver 940 Amram Kass PC Defined Benefit Pension Plan 940 David A. Wolf 940 Tis Prager 658 Bruno Widmer 658 Karen Cook, IRA (KC) 470 Jack Hirschfield 235 Paramount Capital Drug Development Holdings LLC 25,461 Steve H. Kanzer 5,709 Nicholas Bodor 2,530 Kenneth U. Johnson 2,530 Rivki Rosenwald 2,480 Biotechnology Solutions, LLC 1,596 Nicholas Stergiopoulos 764 Wayne L. Rubin 759 Michael Weiss 759 Peter and Donna Kash 506 David R. Walner 506 Huntington Street Company 506 June Street Company 506 Rivki Rosenwald Custodian f/b/o Doni Rosenwald 506 Rivki Rosenwald Custodian f/b/o Joshy Rosenwald 506 Rivki Rosenwald Custodian f/b/o Demi Rosenwald 506 Rivki Rosenwald Custodian f/b/o Davy Rosenwald 506 Kash Family Foundation 405 Joseph E. Edelman 379 Sarah E. Laut 357 Michael Ferrari 357 Blossom Rosenwald 344 Seth Rosenwald 344 Jon Rosenwald 344 William Kanzer 304 Gary Kanzer 304 Donna Lozito 111 American Friends of Hebron Yeshiva in Jerusalem 101 Fred Mermelstein 101 Lauren S. Fischer 86 John Knox 86 David M. Tanen 86 Evan S. Borak 86 Hope Viggiani 50 Robert Klein 50 Howard Schain 50 John Pappadimitropoulos 25
3. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after March 31, 2003 pursuant to Section 5 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 50,769 Nomura Bank (Switzerland) Ltd. 45,128 Paul Capital Partners V, L.P. 33,560 Imprimus Investors LLC 18,804 Bristol Rittenhouse Investments, L.P. 18,804 Kendall Investments, LLC 9,402 IMS Global Investments X Ltd. 9,402 Richard J. Stern 7,522
Stockholder Name Number of shares of Common Stock Stern Joint Venture, L.P. 7,522 Wolfson Equities 7,522 Lindsay A. Rosenwald, M.D. 6,581 Concordia Partners 5,641 C. Benveniste-Schuler 5,641 Drax Holdings, L.P. 4,701 Bernard Selz 4,701 Michael Steinhardt 4,701 Keys Foundation, Curacro 4,701 Albert Reichmann 3,761 James D. Stern 3,761 Paul Capital Partners V (Domestic Annex Fund) L.P. 2,825 Robert I. Falk 1,881 G&G Enterprises 1,881 Gibert Goldstein, Paul Shapiro, Trustees, UIT Howard Gittis Trust 1,881 Caxton Partners 1,881 Jeffrey S. Silverman 1,881 The Holding Company 1,881 Seju Suzuki 1,881 Cass & Co.Magnum Capital Growth Fund 1,881 Yoshimasa Yamazaki 1,881 Asahi Iron Foundry Co., Ltd. 1,881 Richard Vogel 1,881 Maidenhair Investments, N.V. 1,881 Paul Capital Partners V International, L.P. 1,223 Leonard J. Adams 941 Wayne Saker 941 Amram Kass P.C. Money Purchase Plan 941 David A. Braver 941 Amram Kass PC Defined Benefit Pension Plan 941 David A. Wolf 941 Tis Prager 658 Bruno Widmer 658 Karen Cook, IRA (KC) 470 Jack Hirschfield 235 Paramount Capital Drug Development Holdings LLC 25,462 Steve H. Kanzer 5,710 Nicholas Bodor 2,531 Kenneth U. Johnson 2,531 Rivki Rosenwald 2,480 Biotechnology Solutions, LLC 1,596 Nicholas Stergiopoulos 765 Wayne L. Rubin 760 Michael Weiss 760 Peter and Donna Kash 506 David R. Walner 506 Huntington Street Company 506 June Street Company 506 Rivki Rosenwald Custodian f/b/o Doni Rosenwald 506 Rivki Rosenwald Custodian f/b/o Joshy Rosenwald 506 Rivki Rosenwald Custodian f/b/o Demi Rosenwald 506 Rivki Rosenwald Custodian f/b/o Davy Rosenwald 506 Kash Family Foundation 405 Joseph E. Edelman 380 Sarah E. Laut 357 Michael Ferrari 357 Blossom Rosenwald 345 Seth Rosenwald 345 Jon Rosenwald 345 William Kanzer 304 Gary Kanzer 304 Donna Lozito 112 American Friends of Hebron Yeshiva in Jerusalem 102 Fred Mermelstein 102 Lauren S. Fischer 86 John Knox 86 David M. Tanen 86 Evan S. Borak 86
Stockholder Name Number of shares of Common Stock Hope Viggiani 51 Robert Klein 51 Howard Schain 51 John Pappadimitropoulos 26 Schedule D Escrow Agent Fees EX-10.2 5 dex102.txt AMENDMENT #1 ESCROW AGREEMENT Exhibit 10.2 AMENDMENT NO. 1 TO ESCROW AGREEMENT This Amendment No. 1 ("Amendment No. 1") to the Escrow Agreement dated as of November 29, 2001 (the "Agreement") is made and entered into as of November 29, 2001, by and among Endorex Corporation, a Delaware corporation ("Parent"), Peter O. Kliem, as the representative of the stockholders of Corporate Technology Development, Inc. who are parties to the Agreement (the "Stockholder Representative"), Paramount Capital Drug Development Holdings LLC as a stockholder of Corporate Technology Development, Inc. (the "Stockholder"), and Wells Fargo Bank Minnesota, National Association, a national banking association, as escrow agent (the "Escrow Agent"). RECITALS WHEREAS, Parent, certain stockholders of Corporate Technology Development, Inc., a Delaware corporation, the Stockholder Representative and the Escrow Agent have entered into the Agreement; and WHEREAS, Parent, the Stockholder Representative, the Stockholder and the Escrow Agent desire to amend certain terms of the Agreement pursuant to Section 6.5 thereof. AGREEMENT NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein and in the Agreement and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows: 1. Schedule C to the Agreement is hereby be amended and restated in its entirety as set forth on Schedule 1 attached hereto. 2. All capitalized terms used but not defined herein have the meaning ascribed to such terms in the Agreement. 3. All terms of the Agreement other than those amended hereby remain in full force and effect. * * * * * IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be executed and delivered as of the date first written above. PARENT: ENDOREX CORPORATION /s/ Michael S. Rosen ------------------------------- By: Michael S. Rosen --------------------------- Its: President -------------------------- STOCKHOLDER REPRESENTATIVE: /s/ Peter O. Kliem ------------------------------ PETER O. KLIEM ESCROW AGENT: WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, as Escrow Agent /s/ Joseph P. O'Donnell ------------------------------- By: Joseph P. O'Donnell --------------------------- Title: Corporate Trust Officer ------------------------ STOCKHOLDER: PARAMOUNT CAPITAL DRUG DEVELOPMENT HOLDINGS LLC /s/ Lindsay Rosenwald -------------------------------- By: Lindsay Rosenwald --------------------------- Its: --------------------------- Schedule 1 Distributions 1. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after March 31, 2002 pursuant to Section 3 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 101,537 Nomura Bank (Switzerland) Ltd. 90,255 Paul Capital Partners V, L.P. 67,120 Imprimus Investors LLC 37,606 Bristol Rittenhouse Investments, L.P. 37,606 Kendall Investments, LLC 18,803 Richard J. Stern 15,042 Stern Joint Venture, L.P. 15,042 Lindsay A. Rosenwald, M.D. 13,162 Concordia Partners 11,282 C. Benveniste-Schuler 11,282 Drax Holdings, L.P. 9,401 Bernard Selz 9,401 Michael Steinhardt 9,401 Keys Foundation, Curacro 9,401 Albert Reichmann 7,521 James D. Stern 7,521 Paul Capital Partners V (Domestic Annex Fund) L.P. 5,648 Robert I. Falk 3,760 Caxton Partners 3,760 Jeffrey S. Silverman 3,760 The Holding Company 3,760 Seju Suzuki 3,760 Yoshimasa Yamazaki 3,760 Asahi Iron Foundry Co., Ltd. 3,760 Richard Vogel 3,760 Maidenhair Investments, N.V. 3,760 Paul Capital Partners V International, L.P. 2,444 Wayne Saker 1,880 Amram Kass P.C. Money Purchase Plan 1,880 David A. Braver 1,880 Amram Kass PC Defined Benefit Pension Plan 1,880 David A. Wolf 1,880 Tis Prager 1,316 Bruno Widmer 1,316 Karen Cook, IRA (KC) 940 Jack Hirschfield 470 Paramount Capital Drug Development Holdings LLC 131,277 Steve H. Kanzer 11,418 Nicholas Bodor 5,061 Kenneth U. Johnson 5,061 Biotechnology Solutions, LLC 3,191 Nicholas Stergiopoulos 1,528 Michael Weiss 1,518 Peter and Donna Kash 1,012 Huntington Street Company 1,012 June Street Company 1,012 Kash Family Foundation 810 Sarah E. Laut 713 Michael Ferrari 713 Seth Rosenwald 688 Jon Rosenwald 688 William Kanzer 607 Gary Kanzer 607 American Friends of Hebron Yeshiva in Jerusalem 202
Stockholder Name Number of shares of Common Stock Fred Mermelstein 202 Lauren S. Fischer 172 John Knox 172 David M. Tanen 172 Evan S. Borak 172 Hope Viggiani 101 Robert Klein 101 Howard Schain 101 2. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after September 30, 2002 pursuant to Section 4 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 50,769 Nomura Bank (Switzerland) Ltd. 45,128 Paul Capital Partners V, L.P. 33,560 Imprimus Investors LLC 18,803 Bristol Rittenhouse Investments, L.P. 18,803 Kendall Investments, LLC 9,401 Richard J. Stern 7,521 Stern Joint Venture, L.P. 7,521 Lindsay A. Rosenwald, M.D. 6,581 Concordia Partners 5,641 C. Benveniste-Schuler 5,641 Drax Holdings, L.P. 4,701 Bernard Selz 4,701 Michael Steinhardt 4,701 Keys Foundation, Curacro 4,701 Albert Reichmann 3,761 James D. Stern 3,761 Paul Capital Partners V (Domestic Annex Fund) L.P. 2,824 Robert I. Falk 1,880 Caxton Partners 1,880 Jeffrey S. Silverman 1,880 The Holding Company 1,880 Seju Suzuki 1,880 Yoshimasa Yamazaki 1,880 Asahi Iron Foundry Co., Ltd. 1,880 Richard Vogel 1,880 Maidenhair Investments, N.V. 1,880 Paul Capital Partners V International, L.P. 1,222 Wayne Saker 940 Amram Kass P.C. Money Purchase Plan 940 David A. Braver 940 Amram Kass PC Defined Benefit Pension Plan 940 David A. Wolf 940 Tis Prager 658 Bruno Widmer 658 Karen Cook, IRA (KC) 470 Jack Hirschfield 235 Paramount Capital Drug Development Holdings LLC 45,550 Steve H. Kanzer 5,709 Nicholas Bodor 2,530 Kenneth U. Johnson 2,530 Biotechnology Solutions, LLC 1,596 Nicholas Stergiopoulos 764 Michael Weiss 759 Peter and Donna Kash 506 Huntington Street Company 506 June Street Company 506 Kash Family Foundation 405 Sarah E. Laut 357
Stockholder Name Number of shares of Common Stock Michael Ferrari 357 Seth Rosenwald 344 Jon Rosenwald 344 William Kanzer 304 Gary Kanzer 304 American Friends of Hebron Yeshiva in Jerusalem 101 Fred Mermelstein 101 Lauren S. Fischer 86 John Knox 86 David M. Tanen 86 Evan S. Borak 86 Hope Viggiani 50 Robert Klein 50 Howard Schain 50
3. Common Stock to be distributed by the Escrow Agent to the Stockholder Representative on or promptly after March 31, 2003 pursuant to Section 5 of Schedule B: ----------
Stockholder Name Number of shares of Common Stock TVM Medical Ventures GmbH & Co. KG 50,769 Nomura Bank (Switzerland) Ltd. 45,128 Paul Capital Partners V, L.P. 33,560 Imprimus Investors LLC 18,804 Bristol Rittenhouse Investments, L.P. 18,804 Kendall Investments, LLC 9,402 Richard J. Stern 7,522 Stern Joint Venture, L.P. 7,522 Lindsay A. Rosenwald, M.D. 6,581 Concordia Partners 5,641 C. Benveniste-Schuler 5,641 Drax Holdings, L.P. 4,701 Bernard Selz 4,701 Michael Steinhardt 4,701 Keys Foundation, Curacro 4,701 Albert Reichmann 3,761 James D. Stern 3,761 Paul Capital Partners V (Domestic Annex Fund) L.P. 2,825 Robert I. Falk 1,881 Caxton Partners 1,881 Jeffrey S. Silverman 1,881 The Holding Company 1,881 Seju Suzuki 1,881 Yoshimasa Yamazaki 1,881 Asahi Iron Foundry Co., Ltd. 1,881 Richard Vogel 1,881 Maidenhair Investments, N.V. 1,881 Paul Capital Partners V International, L.P. 1,223 Wayne Saker 941 Amram Kass P.C. Money Purchase Plan 941 David A. Braver 941 Amram Kass PC Defined Benefit Pension Plan 941 David A. Wolf 941 Tis Prager 658 Bruno Widmer 658 Karen Cook, IRA (KC) 470 Jack Hirschfield 235 Paramount Capital Drug Development Holdings LLC 45,551 Steve H. Kanzer 5,710 Nicholas Bodor 2,531 Kenneth U. Johnson 2,531 Biotechnology Solutions, LLC 1,596 Nicholas Stergiopoulos 765
Stockholder Name Number of shares of Common Stock Michael Weiss 760 Peter and Donna Kash 506 Huntington Street Company 506 June Street Company 506 Kash Family Foundation 405 Sarah E. Laut 357 Michael Ferrari 357 Seth Rosenwald 345 Jon Rosenwald 345 William Kanzer 304 Gary Kanzer 304 American Friends of Hebron Yeshiva in Jerusalem 102 Fred Mermelstein 102 Lauren S. Fischer 86 John Knox 86 David M. Tanen 86 Evan S. Borak 86 Hope Viggiani 51 Robert Klein 51 Howard Schain 51
EX-23.1 6 dex231.txt CONSENT OF RICHARD A. EISNER & COMPANY, LLP. EXHIBIT 23 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Form 8-K of DOR BioPharma, Inc. (formerly Endorex Corporation) of our report dated March 9, 2001 (with respect to Note I[2], July 31, 2001), with respect to the consolidated financial statements of Corporate Technology Development, Inc. included in the Registration Statement on Form S-4 of Endorex Corporation which became effective with the Securities and Exchange Commission on October 23, 2001. /s/ Richard A. Eisner & Company, LLP New York, New York December 11, 2001 EX-99.1 7 dex991.txt PRESS RELEASE DATED DECEMBER 3, 2001 Exhibit 99.1 ENDOREX CORPORATION ACQUIRES CORPORATE TECHNOLOGY DEVELOPMENT, INC. Chicago - December 3, 2001 - Endorex Corporation (AMEX:DOR) announced today the completion of its acquisition of Corporate Technology Development, Inc. ("CTD"). Endorex shareholders approved the issuance of Endorex common stock, options and warrants in connection with the acquisition of CTD at the Annual Shareholders' Meeting held at Endorex headquarters in Lake Forest, Illinois on Thursday, November 29, 2001. In addition, Endorex shareholders ratified the appointment of Ernst & Young LLP as Endorex's independent auditors for the fiscal year ending December 31, 2001, elected Michael S. Rosen, Richard Dunning, Steve H. Kanzer, Paul Rubin, Kenneth Tempero and Steven Thornton to the board of directors; approved a name change from "Endorex Corporation" to "DOR BioPharma, Inc."; approved an amendment to Endorex's Amended and Restated 1995 Omnibus Incentive Plan and approved grants to Endorex's non-employee directors. New Company Name Endorex's new name, DOR BioPharma, Inc., signifies a new phase and shifting of strategic direction to encompass a wider range of (D)elivery of (Or)al biopharmaceuticals -- hence the acronym DOR -- ranging from small molecule drugs to macromolecular drugs, such as peptides. The use of "DOR" in the name also reflects a global outlook as it has relevant meanings in other languages, i.e., in Hebrew "the advent of a new generation" and in French "of gold" or "golden." Michael Rosen, Endorex President said, "We believe the new name better reflects and exemplifies the combined strength and direction of the company, while maintaining the American Stock Exchange stock symbol "DOR" recognized by investors in the biotechnology industry. We are thrilled by the approval of the acquisition by our shareholders and will move rapidly to integrate both companies now that the acquisition has been culminated." Broadened Product Pipeline The addition of two CTD oral drug candidates currently in clinical development is key to Endorex entering this new phase with a broadened product pipeline and platform drug delivery technology. The lead product candidate is orBec(TM), an oral form of the drug beclomethasone dipropionate, which is currently being studied in a multicenter phase III clinical trial for the treatment of intestinal graft-versus-host disease ("iGVHD") and a phase II clinical trial for the treatment of Crohn's disease. Crohn's disease is a gastrointestinal disorder often producing significant morbidity, including hospitalization and surgery. Graft-versus-host-disease ("GVHD") is a life-threatening complication that affects the skin, liver, and gastrointestinal tract following bone marrow transplants currently used to treat various types of cancer. Recently, the U.S. Food and Drug Administration (the "FDA") granted orphan drug designation for orBecTM for the prevention of GVHD in addition to the orphan drug designation previously granted for the treatment of iGVHD. orBec? has also received "fast track" designation by the FDA for iGVHD. The significance of receiving orphan drug designation is that it promotes the development of new drug therapies for rare diseases by affording four to seven years of market protection from competitors along with tax credits on clinical trial expenditures. Additionally, Endorex's platform oral drug delivery technologies, originally developed at the Massachusetts Institute of Technology and based on lipid and liposome systems, is being developed for the oral delivery of peptide-based drugs and small molecule drugs that are water insoluble and currently only available in formulations that are delivered via needle-based therapies. Enhanced Management Team The acquisition enhances Endorex's management team with the addition of Colin Bier, Ph.D., the Chairman of the Board of CTD prior to the acquisition, becoming Endorex's Chairman and Chief Executive Officer. Dr. Bier had served as a director since 1998 and as Chairman of the Board of Directors of CTD since 2000. The former Chairman of the Board of Endorex, Kenneth Tempero, M.D., Ph.D., will continue to serve as a director of Endorex. Michael S. Rosen continues at the helm as President, and in the new position of Chief Operating Officer. Two members of the CTD board, Guy Rico and Peter Kliem, will also join Endorex's Board of Directors. "The combination of Endorex and CTD provides the critical mass to move forward in a very positive manner to develop important drugs," Dr. Bier comments. Endorex is a development-stage drug delivery company developing oral and mucosal formulations of small molecule and macromolecular drugs that are traditionally delivered in non-oral formats. Endorex anticipates its oral products will enhance patient quality of life, patient compliance to therapy and potentially reduce the healthcare cost related to needle-based delivery. This press release contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that involve a number of known and unknown risks and uncertainties. These statements are only predictions and actual events or results in future periods may differ materially from what is currently anticipated. In particular, we cannot assure you that we will be able to successfully develop or commercialize products based on our technology, particularly in light of the significant uncertainty inherent in developing drug delivery products, conducting clinical trials and obtaining regulatory approvals, that our technologies will prove to be safe and effective, that our cash expenditures will be at projected levels, that we will be able to obtain future financing or funds, that we or our joint ventures or our collaborations with other companies in the U.S. and abroad will successfully develop products or become profitable, that our joint ventures or our collaborations with other companies will continue, that our business strategy will be successful or that we will be able to carry out our plans for 2001 and beyond. This press release also contains forward-looking statements regarding Endorex's plans, expectations, intentions and strategies. These statements include forward-looking statements about Endorex's product development and product pipeline. These statements are not guarantees of future performance or results and actual results could differ materially from current expectations. Factors that could cause or contribute to such differences include, but are not limited to, the possibility that the operations, management and products of Endorex and CTD will not be successfully integrated, the effects of the merger on the progress of certain drug development projects and the failure to achieve the benefits sought by the merger. Furthermore, Endorex cannot assure you that it will be able to successfully develop or commercialize products based on its technology, particularly in light of the significant uncertainty inherent in developing drug and drug delivery products, conducting clinical trials and obtaining regulatory approvals, that its technologies will prove to be safe and effective, that its cash expenditures will be at projected levels, that product development and commercialization efforts will not be reduced or discontinued due to difficulties or delays in clinical trials or due to lack of progress or positive results from research and development efforts, that it will be able to successfully patent, register or protect its technology, trademarks and products, or that the business strategy of Endorex will be successful. In addition to the matters described in this press release, risk factors as described from time to time in Endorex's filings with the Securities and Exchange Commission, including, but not limited to, our most recent reports on Form 10-QSB, Form 10-KSB, as amended, and our Registration Statement on Form S-4, as amended, may affect our financial results. We assume no obligation to update the information in this release. # # # 2 -----END PRIVACY-ENHANCED MESSAGE-----