EXHIBIT 10.2
PENTECH FINANCIAL SERVICES,INC.
EQUIPMENT FINANCING COMMITMENT
EFA No 200061
Subject to the terms set forth in this commitment, the following equipment
financing transaction is agreed to by the undersigned Debtor and PENTECH
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FINANCIAL SERVICES, INC. ("Secured Party") in connection with the terms of the
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Equipment Financing Agreement herein referenced (the "Agreement").
Equipment Financing
Agreement: Dated as of DECEMBER , 1997
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Equipment (all Equipment to be acceptable to Secured Party):
Commitment Amount: $1,000,000.00 of which $500,000.00 is made available
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immediately, $250,000.00 to be made available to the
Company upon the successful closing of a private
placement(s) in a minimum amount of $1,500,000.00 prior
to January 15, 1998, and the final $250,000.00 will be
available after the closing of an additional equity round
of at least $1,500,000.00 by April 30, 1998.
Installment Payments: 30 payments of 3.767% of advance payable monthly in
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advance, PLUS A FINAL PAYMENT EQUAL TO 12 % OF THE
ADVANCE.
First such payment(s) are due at time of scheduling.
Commitment Expiration
Date: January 31, 1998. As more fully explained below,
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Secured Party has no obligation to make any advance with
respect to Equipment not covered by a Schedule to the
Agreement executed by Secured Party and Debtor on or
prior to this date.
Debtor will comply with, procure, execute and/or have executed, acknowledge,
have acknowledged, deliver to Secured Party, record and file any documents set
forth in Exhibit A or accompanying this commitment. The form, substance and
sufficiency of all documents and showings employed in documenting the
contemplated financing transaction must be acceptable to Secured Party and its
counsel. Debtor will do likewise as to such further documents and showings as
Secured Party and its counsel may now or hereafter deem necessary or advisable
to protect Secured Party's rights under the Agreement and interest in the
Equipment. Debtor will pay as directed by Secured Party or reimburse Secured
Party for all searches, filings, title reports, attorney's services and other
charges incurred by Secured Party in connection with all such documents and
showings and any similar documents and showings Secured Party may procure.
Secured Party may, at its option, terminate its obligations to Debtor hereunder
with respect to any and all unscheduled Items of Equipment: (a) at or
subsequent to the Commitment Expiration Date, (b) upon the advent of a material
adverse change in Debtor's financial condition or Debtor's probable ability to
perform its obligations under the Agreement, (c) if the Agreement or any other
agreement under which Debtor has obligations to Secured Party is in default or
an event which with the giving of notice or lapse of time or both would
constitute such a default has occurred and is continuing or (d) with respect to
which more than fifteen percent (15%) would be advanced for shipping costs,
installation charges and design costs by giving Debtor written notice of such
termination.
ACCEPTED AND AGREED to as of:
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PENTECH FINANCIAL SERVICES, INC. CHEMTRAK, INC.
By: ________________________________ By:______________________________
(Title)______________________________ (Title)__________________________
Address: 000 XXXX XXXXXXXX XXX Address: 000 X XXXXXX XXX.
XXXXXXXX, CA. 95008 SUNNYVALE, CA 94086
EXHIBIT A TO EQUIPMENT FINANCING COMMITMENT
Accepted by Xxxxxx as of December ____, 1997
Page 1 of 2
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These provisions hereby become part of the Equipment Financing Commitment
between Pentech Financial Services, Inc., Secured Party, and CHEMTRAK, INC.,
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Debtor., dated December ____, 1997.
In addition to the terms of the Agreement, Xxxxxx further agrees to the
following additional provisions:
1. UCC SEARCH/RELEASES
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The Secured Party may search all public records of Debtor to locate and
identify any conflicting liens against the above referenced Equipment.
Releases from any intervening parties holding a security interest in said
Equipment shall be required prior to funding provided herein.
2. TYPE OF FINANCING
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This is a net equipment financing transaction whereby maintenance,
insurance, property taxes, and all items of a similar nature are for the
account of the Debtor.
3. EXPENSES
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All expenses associated with the completion of this Agreement including,
but not limited to, UCC filing fees and searches, documentation costs,
legal expenses, and equipment verification costs are for the account
of the debtor.
4. MASTER AGREEMENT
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This is a Master Equipment Financing Agreement whereby Schedules may be
funded as equipment is delivered. Each Schedule to the Agreement, however,
shall cover equipment with a minimum aggregate cost of $50,000.00.
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5. INSTALLMENT PAYMENT AMOUNT
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The installment payment amount of $37.67 per $1,000.00 of advance payable
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monthly in advance is based on the current Wall Street Journal prime rate
amount of 8.5%. Once a Schedule is funded, however, the installment payment
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remains fixed for the duration of the term.
6. COMMITMENT EXPIRATION DATE
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The commitment expiration date of January 31, 1998, may be extended ninety
(90) days upon review by Secured Party of the Debtor's then current
financial condition. Xxxxxx agrees to provide Secured Party such financial
information and other information Secured Party may reasonably request to
evaluate Debtor's financial condition for purposes of granting such
extension.
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7. COMMITMENT FEE DEPOSIT
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Debtor shall provide Secured Party a $10,000.00 commitment fee deposit,
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receipt of which is hereby acknowledged. This deposit shall be applied to
the advance payments due for the last Schedule funded under this Agreement.
Any unapplied balance as of the commitment expiration date may be retained
by Secured Party.
8. MONTHLY FINANCIAL STATEMENTS
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Xxxxxx agrees to provide Secured Party the Debtor's internally prepared
financial statements on an ongoing basis not later than fifteen (15) days
after the close of each month of Debtor's fiscal year. Upon request by
Secured Party, Xxxxxx also agrees to provide any other pertinent and
reasonable information as Secured Party may deem necessary to evaluate
Debtor's future financial condition.
9. ANNUAL FINANCIAL STATEMENTS
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Debtor agrees to provide Secured Party the Debtor's annual financial
statements within ninety (90) days of the close of Debtor's fiscal year
end.
10. SCHEDULES
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There shall be three (3) Draws to the Agreement covering equipment with a
maximum aggregate cost of $1,000,000.00.
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