SECOND AMENDED AND RESTATED REVOLVING LINE OF CREDIT NOTE WORKING CAPITAL
Exhibit
10.2
SECOND
AMENDED AND RESTATED
WORKING
CAPITAL
|
$14,500,000.00
U.S.
|
January
19, 2007
|
FOR
VALUE
RECEIVED, the undersigned, VeriChip Corporation, a Delaware corporation with
a
principal place of business at 0000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx
Xxxxx, Xxxxxxx 00000 (the “Borrower”), hereby promises to pay to the order of
Applied Digital Solutions, Inc., a Missouri corporation located at 0000 Xxxxx
Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxx Xxxxx, Xxxxxxx 00000 (the “Lender”), at such
address, or such other place or places as the holder hereof may designate in
writing from time to time hereafter, the maximum principal sum of Fourteen
Million Five Hundred Thousand Dollars ($14,500,000.00), or, if less, so much
thereof as may be advanced or readvanced by the Lender to the Borrower pursuant
to the terms of the Loan Agreement (as hereinafter defined), together with
interest as provided for herein below, in lawful money of the United States
of
America.
Interest
shall be calculated and charged daily on the basis of actual days elapsed over
a
three hundred sixty (360) day banking year, on the unpaid principal balance
outstanding from time to time at a fixed rate equal to twelve percent (12%)
per
annum (the “Interest Rate”). The Interest Rate will apply to the outstanding
amount under the Loan Agreement and this Second Amended and Restated Revolving
Line of Credit Note (the "Note") effective from and after October 6, 2006 which
is the date of the Amended and Restated Revolving Line of Credit Note in the
principal amount of $13,000,000.00 from the Borrower in favor of the Lender
(the
"Amended and Restated Note"). For avoidance of doubt, the interest rate
described in the Revolving Line of Credit Note dated December 27, 2005 in the
principal amount of $8,500,000.00 from the Borrower in favor of the Lender
(the
"Original Note") applied to the outstanding amounts under the Original Note
prior to the date of the Amended and Restated Note.
The
Borrower shall make the following payments with each such payment consisting
of
principal and interest:
(a)
Seven
Million Dollars ($7,000,000) within ten (10) days after the consummation of
an
initial public offering of the Borrower's common stock pursuant to an effective
registration statement filed with the Securities and Exchange Commission (an
"IPO").
(b)
Assuming the consummation of the IPO described in (a) above occurs, Two Hundred
Fifty Thousand Dollars ($250,000) on the first day of each month commencing
in
January 2008 through August 2008;
(b)
Assuming the consummation of the IPO described in (a) above occurs, Three
Hundred Fifty Thousand Dollars ($350,000) on the first day of each month
commencing in September 2008 through July 2009; and
(c)
one
final balloon payment on
August
1,
2009,
equal
to
the outstanding principal amount then due under the Loans and the other
Obligations, plus all accrued and unpaid
interest
and any fees or expenses outstanding.
Notwithstanding
the above payment schedule, in the event an IPO is not consummated on or before
July 1, 2008, the outstanding principal amount then due under the Loans and
the
other Obligations, plus all accrued and unpaid interest and any fees or expenses
outstanding, shall be due and payable on July 1, 2008, unless extended pursuant
to the terms of the Loan Agreement.
All
payments made hereunder shall be applied first to any then unpaid, but accrued,
interest and then to principal.
The
Note
is issued under, and is subject to, the Commercial Loan Agreement dated December
27, 2005, as amended by that First Amendment to Commercial Loan Agreement dated
October 6, 2006 and that Second Amendment to Commercial Loan Agreement dated
January 19, 2007, between the Borrower and the Lender, as it may be amended
from
time to time (the “Loan Agreement”). The holder of this Note is entitled to all
of the benefits and rights of the Lender under the Loan Agreement. However,
neither this reference to the Loan Agreement nor any provision thereof shall
impair the absolute and unconditional obligation of the undersigned to pay
the
principal and interest on this Note as herein provided. Any capitalized term
used in this Note that is not otherwise expressly defined herein shall have
the
meaning ascribed thereto in the Loan Agreement.
The
holder may impose upon the undersigned a delinquency charge of $35.00 or five
percent (5.00%) of the amount of the principal and/or interest payment not
paid
on or before the thirtieth (30th) day after such installment is due, whichever
is greater. The entire principal balance hereof, together with accrued interest,
shall after maturity, whether by demand, acceleration or otherwise, bear
interest at the contract rate of this Note plus an additional three percent
(3.00%) per annum. Upon default by Borrower under the terms of this Note or
any
other Loan Documents, interest shall accrue at a variable rate equal to the
contract rate of this Note plus three percent (3.00%).
The
undersigned agrees to pay on demand all reasonable out-of-pocket costs of
collection hereof, including court costs, service fees, and reasonable
attorney’s fees, whether or not any foreclosure or other action is instituted by
the holder in its discretion.
The
word
“holder”, as used in this Note, shall mean the payee or endorsee of this Note
who is in possession of it, or the bearer, if this Note is at that time payable
to the bearer.
The
indebtedness evidenced by this Note is secured by the Loan Documents as defined
in the Loan Agreement. Any default by the undersigned under the Loan Documents
shall constitute a default under this Note entitling the holder to declare
the
entire principal amount of the indebtedness evidenced hereby, together with
all
accrued interest thereon, immediately due and payable.
No
delay
or omission on the part of the holder in exercising any right, privilege or
remedy shall impair such right, privilege or remedy or be construed as a waiver
thereof or of any other right, privilege or remedy. No waiver of any right,
privilege or remedy or any amendment
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to
this
Note shall be effective unless made in writing and signed by the holder. Under
no circumstances shall an effective waiver of any right, privilege or remedy
on
any one occasion constitute or be construed as a bar to the exercise of or
a
waiver of such right, privilege or remedy on any future occasion. The acceptance
by the holder hereof of any payment after any default hereunder shall not
operate to extend the time of payment of any amount then remaining unpaid
hereunder or constitute a waiver of any rights of the holder hereof under this
Note.
All
rights and remedies of the holder, whether granted herein or otherwise, shall
be
cumulative and may be exercised singularly or concurrently, and the holder
shall
have, in addition to all other rights and remedies, the rights and remedies
of a
secured party under the Uniform Commercial Code of New Hampshire. The holder
shall have no duty as to the collection or protection of the Collateral or
of
any income thereon, or as to the preservation of any rights pertaining thereto
beyond the safe custody thereof. Surrender of this Note, upon payment or
otherwise, shall not affect the right of the holder to retain the Collateral
as
security for the payment and performance of any other liability of the
undersigned to the holder.
Every
maker, endorser, or guarantor of this Note, or the obligations represented
by
this Note, waives all exemption rights, valuation and appraisement, presentment,
protest and demand, demand for payment, notice of dishonor and protest and
all
other demands and notices in connection with the delivery, acceptance,
performance, default or enforcement of this Note, and assents to any extension
or postponement of the time of payment or any other indulgence, to any
substitution, exchange or release of Collateral, and/or to the addition or
release of any other party or person primarily or secondarily liable.
This
Note
may be prepaid in whole or in part without penalty.
This
Note
and the provisions hereof shall be binding upon the undersigned and the
undersigned’s heirs, administrators, executors, successors, legal
representatives and assigns and shall inure to the benefit of the holder, the
holder’s heirs, administrators, executors, successors, legal representatives and
assigns.
This
Note
amends and restates the Amended and Restated Note. This
Note
may not be amended, changed or modified in any respect except by a written
document that has been executed by each party. This Note constitutes a New
Hampshire sealed instrument and contract to be governed by the laws of such
state and to be paid and performed therein.
IN
THE
PRESENCE OF:
VeriChip
Corporation
/s/
Xxxx X. Xxxxxxx
By:
/s/
Xxxxxx X.
Xxxxxxx
Print
Name:
Xxxxxx X. Xxxxxxx
Title:
President
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