MOLECULAR DIAGNOSTICS, INC.
OFFER TO EXCHANGE
800,000 SHARES OF SERIES E CONVERTIBLE PREFERRED STOCK
FOR UP TO
20,000,000 SHARES OF COMMON STOCK
To: BROKERS, DEALERS, COMMERCIAL BANKS, TRUST COMPANIES AND OTHER NOMINEES:
Molecular Diagnostics, Inc. ("Molecular Diagnostics") is offering, subject
to the terms and conditions set forth in the Offering Circular, dated November
19, 2001 (the "Offering Circular"), and the related letter of transmittal (the
"Letter of Transmittal"), relating to the offer to exchange (the "Exchange
Offer") 1/25 (one twenty-fifth) of a share of Series E convertible preferred
stock, par value $0.001, of Molecular Diagnostics, for each share of common
stock par value $0.001, of Molecular Diagnostics. Subject to the terms and
conditions of the Exchange Offer, Molecular Diagnostics will issue 800,000
shares of Series E convertible preferred stock in exchange for up to 20,000,000
shares of common stock representing approximately 56% of the outstanding common
stock as of November 16, 2001, that, in each case, are properly tendered and not
withdrawn prior to the expiration of the Exchange Offer. If more than 20,000,000
shares of common stock are tendered, Molecular Diagnostics will purchase from
each tendering holder of common stock an amount based on the proportion of
common stock tendered by that holder to all common stock tendered. For a more
detailed description of the Series E convertible preferred stock Molecular
Diagnostics is proposing to issue in the Exchange Offer, please see the section
of the Offering Circular entitled "Description of Series E Convertible Preferred
Stock." Molecular Diagnostics reserves the right to extend or terminate the
Exchange Offer, in its sole and absolute discretion, which may be for any or no
reason, and to otherwise amend the Exchange Offer in any respect. The Exchange
Offer is open to all holders of common stock and is subject to customary
conditions. Subject to applicable securities laws and the terms set forth in the
Offering Circular, Molecular Diagnostics reserves the right to waive any and all
conditions to the Exchange Offer.
We are requesting that you contact your clients for whom you hold common
stock regarding the Exchange Offer. For your information and for forwarding to
your clients for whom you hold common stock registered in your name or in the
name of your nominee, or who hold common stock registered in their own names, we
are enclosing the following documents:
1. The Offering Circular;
2. The Letter of Transmittal for your use and for the information of your
clients;
3. A Notice of Guaranteed Delivery to be used to accept the Exchange Offer
if (a) certificates for the common stock are not immediately available,
(b) time will not permit the certificates for the common stock or other
required documents to reach the Exchange Agent before the expiration of
the Exchange Offer, or (c) the procedure for book-entry transfer cannot
be completed prior to the expiration of the Exchange Offer;
4. A form of letter which may be sent to your clients for whose account you
hold common stock registered in your name or the name of your nominee,
with space provided for obtaining the clients' instructions with respect
to the Exchange Offer;
5. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9; and
6. Return envelopes addressed to LaSalle Bank National Association, the
Exchange Agent for the Exchange Offer.
YOUR PROMPT ACTION IS REQUESTED. THE EXCHANGE OFFER WILL EXPIRE AT 5:00
P.M., NEW YORK CITY TIME, ON DECEMBER 19, 2001. MOLECULAR DIAGNOSTICS, IN ITS
SOLE AND ABSOLUTE DISCRETION, MAY EXTEND THE EXCHANGE OFFER (THE "EXPIRATION
DATE"). COMMON STOCK TENDERED PURSUANT TO THE EXCHANGE OFFER MAY BE WITHDRAWN AT
ANY TIME BEFORE THE EXPIRATION DATE OR AT ANY
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TIME AFTER JANUARY 18, 2002 IF MOLECULAR DIAGNOSTICS HAS NOT ACCEPTED THE
TENDERED COMMON STOCK FOR EXCHANGE BY THAT DATE.
Unless a holder of common stock complies with the procedures described in
the Offering Circular under the title "The Exchange Offer -- Guaranteed Delivery
Procedures," the holder must do one of the following on or prior to the
Expiration Date to participate in the Exchange Offer:
- tender the common stock by sending the certificates for the common stock,
in proper form for transfer, a properly completed and duly executed
Letter of Transmittal, with any required signature guarantees, and all
other documents required by the Letter of Transmittal, to LaSalle Bank
National Association, as Exchange Agent, at one of the addresses listed
in the Offering Circular under the title "The Exchange Offer -- Exchange
Agent"; or
- tender the common stock by using the book-entry procedures described in
the Offering Circular under the title "The Exchange Offer -- Procedures
for Tendering Common Stock" and transmitting a properly completed and
duly executed Letter of Transmittal, with any required signature
guarantees, or an Agent's Message, as defined below, instead of the
Letter of Transmittal, to the Exchange Agent.
In order for a book-entry transfer to constitute a valid tender of common
stock in the Exchange Offer, the Exchange Agent must receive a confirmation of
book-entry transfer (a "Book-Entry Confirmation") of the common stock into the
Exchange Agent's applicable account at The Depository Trust Company prior to the
Expiration Date. The term "Agent's Message" means a message, transmitted by the
Depository Trust Company and received by the Exchange Agent and forming a part
of the Book-Entry Confirmation, which states that The Depository Trust Company
has received an express acknowledgment from the tendering holder of common stock
that the holder has received and has agreed to be bound by the Letter of
Transmittal.
If common stock is to be tendered in the Exchange Offer, but (a) the
certificates for the common stock are not immediately available, (b) time will
not permit the certificates for the common stock or other required documents to
reach the Exchange Agent before the Expiration Date, or (c) the procedure for
book-entry transfer cannot be completed before the Expiration Date, a tender of
common stock may be effected by following the Guaranteed Delivery Procedures
described in the Offering Circular under the title "The Exchange
Offer -- Guaranteed Delivery Procedures."
Molecular Diagnostics will not make any payments to brokers, dealers or
other persons for soliciting acceptances of the Exchange Offer. Molecular
Diagnostics will, however, upon request, reimburse brokers, dealers, commercial
banks, trust companies and other nominees for reasonable and necessary costs and
expenses incurred by them in forwarding the Offering Circular and the related
documents to the beneficial owners of common stock held by them as nominee or in
a fiduciary capacity. Molecular Diagnostics will pay or cause to be paid all
stock transfer taxes applicable to the exchange of common stock in the Exchange
Offer, except as set forth in the Letter of Transmittal.
Any inquiries you may have with respect to the Exchange Offer, or requests
for additional copies of the enclosed materials, should be directed to LaSalle
Bank National Association, the Exchange Agent for the Exchange Offer, at one of
the addresses and telephone number set forth on the front of the Letter of
Transmittal.
Very truly yours,
MOLECULAR DIAGNOSTICS, INC.
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY
PERSON AS AN AGENT OF MOLECULAR DIAGNOSTICS, INC. OR THE EXCHANGE AGENT, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON
BEHALF OF EITHER OF THEM WITH RESPECT TO THE EXCHANGE OFFER, EXCEPT FOR
STATEMENTS EXPRESSLY MADE IN THE OFFERING CIRCULAR OR THE LETTER OF TRANSMITTAL.
Enclosures
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