Exhibit 10.3
REVOLVING LINE OF CREDIT AGREEMENT
This Revolving Line of Credit Agreement (the "AGREEMENT") is made and
entered into in this 15th day of January 2007, by and between Seamless Wi-Fi,
Inc., a Nevada corporation ("LENDER"), and DLR Funding, Inc., a Nevada
corporation ("BORROWER").
In consideration of the mutual covenants and agreements contained
herein, the parties agree as follows:
1. LINE OF CREDIT. Lender hereby establishes for a period extending to
January 14, 2010 (the "MATURITY DATE") a revolving line of credit (the "CREDIT
LINE") for Borrower in the principal amount of Seven Hundred Thousand Dollars
($700,000.00) (the "CREDIT LIMIT"). In connection herewith, Borrower shall
execute and deliver to Lender a Promissory Note in the amount of the Credit
Limit and in form and content satisfactory to Lender. All sums advanced on the
Credit Line or pursuant to the terms of this Agreement (each an "ADVANCE") shall
become part of the principal of said Promissory Note.
2. ADVANCES. Any request for an Advance may be made from time to time
and in such amounts as Borrower may choose; provided, however, any requested
Advance will not, when added to the outstanding principal balance of all
previous Advances, exceed the Credit Limit. Requests for Advances may be made
orally or in writing by such officer of Borrower authorized by it to request
such Advances. Until Lender may be notified otherwise, Borrower hereby
authorizes its President, XXXXXX X. SOCK, and its Chief Financial Officer,
Xxxxxxxx Xxxxxxxx, individually, to request Advances. Lender may deposit or
credit the amount of any requested Advance to Borrower's checking account.
Lender may refuse to make any requested Advance if an Event of Default has
occurred and is continuing hereunder either at the time the request is given or
the date the Advance is to be made, or if an event has occurred or condition
exists which, with the giving of notice or passing of time or both, would
constitute an Event of Default hereunder as of such dates.
The funds from the Advances will be used by the Borrower for general
corporate purposes in connection with the operations of the Borrower.
3. INTEREST. All sums advanced pursuant to this Agreement shall bear
interest from the date each Advance is made until paid in full at the rate of
twelve percent (12%) per annum, simple interest (the "EFFECTIVE RATE").
4. REPAYMENT. Borrower shall pay installments of principal and interest
on the outstanding principal balance as follows. Commencing on April 15, 2007
and on July 15, 2007, and October 15, 2007, Borrower shall pay the outstanding
interest only that has accrued on the then outstanding principal balance as of
the day before the particular due dates just enumerated. Then quarterly
thereafter, until paid, or due, in full, with the quarterly payment amounts
being three (3) times the monthly payment that would be due based on a
forty-eight (48) month amortization ("Quarterly Payment") of the outstanding
principal balance due on the Agreement on each prior calendar quarter's last
business day. The entire unpaid principal balance, together with any accrued
interest and other unpaid charges or fees hereunder, shall be due and payable on
the Maturity Date. All payments shall be made to Lender at such place as Lender
may, from time to time, designate. All payments received hereunder shall be
applied, first, to any costs or expenses incurred by Lender in collecting such
payment or to any other unpaid charges or expenses due hereunder; second, to
accrued interest; and third, to principal. Borrower may prepay principal at any
time without penalty.
5. REPRESENTATIONS AND WARRANTIES. In order to induce Lender to enter
into this Agreement and to make the advances provided for herein, Borrower
represents and warrants to Lender as follows:
a. Borrower is a duly organized, validly existing, and in good
standing under the laws of the State of NEVADA with the power to own its assets
and to transact business in NEVADA.
b. Borrower has the authority and power to execute and deliver
any document required hereunder and to perform any condition or obligation
imposed under the terms of such documents.
c. The execution, delivery and performance of this Agreement
and each document incident hereto will not violate any provision of any
applicable law, regulation, order, judgment, decree, article of incorporation,
by-law, indenture, contract, agreement, or other undertaking to which Borrower
is a party, or which purports to be binding on Borrower or its assets and will
not result in the creation or imposition of a lien on any of its assets.
d. There is no action, suit, investigation, or proceeding
pending or, to the knowledge of Borrower, threatened, against or affecting
Borrower or any of its assets which, if adversely determined, would have a
material adverse affect on the financial condition of Borrower or the operation
of its business.
6. EVENTS OF DEFAULT. An event of default ("Event of Default") will
occur if any of the following events occurs:
a. Failure to pay any principal or interest hereunder within
ten (10) days after the same becomes due.
b. Any representation or warranty made by Borrower in this
Agreement or in connection with any borrowing or request for an Advance
hereunder, or in any certificate, financial statement, or other statement
furnished by Borrower to Lender is untrue in any material respect at the time
when made.
c. Default by Borrower in the observance or performance of any
other covenant or agreement contained in this Agreement, other than a default
constituting a separate and distinct Event of Default under this Paragraph 6.
d. Filing by Borrower of a voluntary petition in bankruptcy
seeking reorganization, arrangement or readjustment of debts, or any other
relief under the Bankruptcy Code as amended or under any other insolvency act or
law, state or federal, now or hereafter existing.
e. Filing of an involuntary petition against Borrower in
bankruptcy seeking reorganization, arrangement or readjustment of debts, or any
other relief under the Bankruptcy Code as amended, or under any other insolvency
act or law, state or federal, now or hereafter existing, and the continuance
thereof for sixty (60) days and not dismissed, bonded, or discharged.
7. REMEDIES. Upon the occurrence of an Event of Default as defined
above, Lender may declare the entire unpaid principal balance, together with
accrued interest thereon, to be immediately due and payable without presentment,
demand, protest, or other notice of any kind. Lender may suspend or terminate
any obligation it may have hereunder to make additional Advances. To the extent
permitted by law, Borrower waives any rights to presentment, demand, protest, or
notice of any kind in connection with this Agreement. No failure or delay on the
part of Lender in exercising any right, power, or privilege hereunder will
preclude any other or further exercise thereof or the exercise of any other
right, power, or privilege. The rights and remedies provided herein are
cumulative and not exclusive of any other rights or remedies provided at law or
in equity. Borrower agrees to pay all costs of collection incurred due to the
default, including court costs and reasonable attorney's fees.
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8. NOTICE. Any written notice will be deemed effective on the date such
notice is placed, first class, postage prepaid, in the United States mail,
addressed to the party to which notice is being given as follows:
Lender: Seamless Wi-Fi, Inc.
Attention: Xxxxxx X. Xxxx
000 X. Xxxxxxx Xx. Xxxxx 000
Xxx Xxxxx, XX 00000
Borrower: DLR Funding, Inc.
Attn.: XXXXXX X. SOCK, Esquire
0000 Xxxx Xxx Xxxxxx Xxxxx 0
Xxxxxxx, XX 00000
9. AFFIRMATIVE COVENANTS. During the term of this Agreement, the
Borrower covenants and agrees:
a) CORPORATE EXISTENCE AND AUTHORIZATIONS. The Borrower shall
maintain in good standing its corporate existence and its right to transact
business in those jurisdictions in which it is now or hereafter doing a material
amount of business, and the Borrower shall maintain all material licenses,
permits and registrations necessary for the conduct of its operations.
b) COMPLIANCE WITH LAWS. The Borrower shall comply with all
material Laws applicable to its business operations.
c) PAYMENT OF OBLIGATIONS. The Borrower shall promptly pay and
discharge or cause to be paid and discharged, as and when due (or as amended or
extended by the lender or creditor), any and all of its lawful debts and other
obligations, including all lawful taxes, rates, levies and assessments and all
claims for labor, materials or supplies; provided, however, that nothing herein
contained shall be construed as prohibiting the Borrower from diligently
contesting in good faith by appropriate proceedings the validity of any such
debt or other obligation, provided Borrower has established adequate reserves
for such debt or obligation on its books and records.
d) FINANCIAL INFORMATION. The Borrower will provide the Lender
with copies of its unaudited quarterly financial statements within 45 days of
the end of each calendar quarter ending during prior to the Maturity Date.
10. NEGATIVE COVENANTS. During the term of this Agreement, the Borrower
covenants and agrees that without the prior written consent of the Lender that:
a) DIVIDENDS. The Borrower shall not declare or pay dividends
or other distributions to its now existing, or new member(s), or other equity
owners.
b) USE OF PROCEEDS. The Borrower will not use the proceeds of
the Loan to be used for any purpose other than that stated herein.
c) CONFLICTING AGREEMENTS. The Borrower will not enter into
any agreement, any term or condition of which would, if complied with by
Borrower, result in an Event of Default.
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10. REMEDIES NOT EXCLUSIVE. The Lender shall be entitled to enforce
payment and performance of all obligations of the Borrower hereunder or under
the Note and to exercise all rights and powers hereunder or under the Note, or
under any Law and the pursuit of any remedy available to the Lender against the
Borrower shall not prejudice or in any manner affect the Lender's right to
realize upon or enforce any other remedy or security now or hereafter available
to it in such order and in such manner as the Lender may determine in its sole
discretion. No such right or remedy shall be exclusive, but each shall be
cumulative and shall be in addition to every other remedy provided herein or in
any other agreement or by Law and each such remedy may be exercised concurrently
or independently. Nothing in this Agreement shall be construed as prohibiting
the Lender from seeking a deficiency judgment against the Borrower.
11. GENERAL PROVISIONS. All representations and warranties made in this
Agreement and the Promissory Note and in any certificate delivered pursuant
thereto shall survive the execution and delivery of this Agreement and the
making of any loans hereunder. This Agreement will be binding upon and inure to
the benefit of Borrower and Lender, their respective successors and assigns,
except that Borrower may not assign or transfer its rights or delegate its
duties hereunder without the prior written consent of Lender. This Agreement,
the Promissory Note, and all documents and instruments associated herewith will
be governed by and construed and interpreted in accordance with the laws of the
State of Nevada. Time is of the essence hereof. This Agreement will be deemed to
express, embody, and supersede any previous understanding, agreements, or
commitments, whether written or oral, between the parties with respect to the
general subject matter hereof. This Agreement may not be amended or modified
except in writing signed by the parties.
EXECUTED on the day and year first written above.
Borrower: DLR Funding, Inc,
By its President and CEO,
----------------------------------
President and CEO
Lender: Seamless Wi-Fi, Inc.,
By its Chief Executive Officer,
---------------------------------
Xxxxxx X. Xxxx, CEO
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Promissory Note
$700,000.00 Las Vegas, NV January 15, 2007
This Promissory Note (the "NOTE") is made and executed as of the date
above, by and between DLR Funding, Inc., a Nevada corporation ("BORROWER"), and
Seamless Wi-Fi, Inc. a Nevada corporation ("LENDER"). By this Note, the Borrower
promises and agrees to pay to the order of Lender, at 00000 Xxxxx Xxxxxxxxx Xxxx
Xxxxx X, Xxxxx Xx Xxxxxxx, XX 00000, or at such other place as Lender may
designate in writing, the principal sum of Seven Hundred Thousand and 00/100
Dollars ($700,000.00), or the aggregate unpaid principal amount of all advances
made by Lender to Borrower pursuant to the terms of a Revolving Line of Credit
Agreement (the "LOAN AGREEMENT") of even date herewith, whichever is less,
together with interest thereon from the date each advance is made until paid in
full, both before and after judgment, at the rate of Twelve percent (12%)per
annum, simple interest.
Borrower shall pay installments of principal and interest on the
outstanding principal balance as follows. Commencing on April 15, 2007 and on
July 15, 2007, and October 15, 2007, Borrower shall pay the outstanding interest
only that has accrued on the then outstanding principal balance as of the day
before the particular due dates just enumerated. Then quarterly thereafter,
until paid, or due, in full, with the quarterly payment amounts being three (3)
times the monthly payment that would be due based on a forty-eight (48) month
amortization ("Quarterly Payment") of the outstanding principal balance due on
the Agreement on each prior calendar quarter's last business day. The entire
unpaid principal balance, together with any accrued interest and other unpaid
charges or fees hereunder, shall be due and payable on the Maturity Date. All
payments shall be made to Lender at such place as Lender may, from time to time,
designate. All payments received hereunder shall be applied, first, to any costs
or expenses incurred by Lender in collecting such payment or to any other unpaid
charges or expenses due hereunder; second, to accrued interest; and third, to
principal. Borrower may prepay principal at any time without penalty.
The entire unpaid principal balance, together with any accrued interest
and other unpaid charges or fees hereunder, shall be due and payable on January
14, 2010 ("MATURITY DATE").
Prepayment in whole or part may occur at any time hereunder without
penalty; provided that the Lender shall be provided with not less than ten (10)
days notice of the Borrower's intent to pre-pay; and provided further that any
such partial prepayment shall not operate to postpone or suspend the obligation
to make, and shall not have the effect of altering the time for payment of the
remaining balance of the Note as provided for above, unless and until the entire
obligation is paid in full. All payments received hereunder shall be applied,
first, to any costs or expenses incurred by Lender in collecting such payment or
to any other unpaid charges or expenses due hereunder; second, to accrued
interest; and third, to principal.
An Event of Default will occur if any of the following events occurs:
(a) failure to pay any principal or interest hereunder within ten (10) days
after the same becomes due; (b) if any representation or warranty made by
Borrower in the Loan Agreement or in connection with any borrowing or request
for an advance thereunder, or in any certificate, financial statement, or other
statement furnished by Borrower to Lender is untrue in any material respect at
the time when made; (c) default by Borrower in the observance or performance of
any other covenant or agreement contained in the Loan Agreement, other than a
default constituting a separate and distinct Event of Default under Paragraph 7
of the Loan Agreement; (d) filing by Borrower of a voluntary petition in
bankruptcy seeking reorganization, arrangement or readjustment of debts, or any
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other relief under the Bankruptcy Code as amended or under any other insolvency
act or law, state or federal, now or hereafter existing; or (e) filing of an
involuntary petition against Borrower in bankruptcy seeking reorganization,
arrangement or readjustment of debts, or any other relief under the Bankruptcy
Code as amended, or under any other insolvency act or law, state or federal, now
or hereafter existing, and the continuance thereof for sixty (60) days that is
not dismissed, bonded, or discharged.
Any notice or demand to be given to the parties hereunder shall be
deemed to have been given to and received by them and shall be effective when
personally delivered or when deposited in the U.S. mail, certified or registered
mail, return receipt requested, postage prepaid, and addressed to the party at
his or its last known address, or at such other address as the one of the
parties may hereafter designate in writing to the other party.
The Borrower hereof waives presentment for payment, protest, demand,
notice of protest, notice of dishonor, and notice of nonpayment, and expressly
agrees that this Note, or any payment hereunder, may be extended from time to
time by the Lender without in any way affecting its liability hereunder.
In the event any payment under this Note is not made at the time and in
the manner required, the Borrower agrees to pay any and all costs and expenses
which may be incurred by the Lender hereof in connection with the enforcement of
any of its rights under this Note or under any such other instrument, including
court costs and reasonable attorneys' fees.
This Note shall be governed by, construed under, and enforced in
accordance with the laws of the State of Nevada.
The Borrower:
DLR Funding, Inc.,
By its President and CEO,
_________________________________________
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