Exhibit 10.12
Collateralized Nonrecourse Loan Agreement
THIS COLLATERALIZED NONRECOURSE LOAN AGREEMENT is entered into by
Schimatic Cash Transactions Xxxxxxx.xxx, Inc.(the"Company")and _________________
(the "Borrower"), as of May 3,2001, in consideration of the mutual
understandings as described below.
A Representations.
1 The Company desires to provide Borrower funds
sufficient to enable Borrower to exercise certain
common stock options granted by the Company to
Borrower.
2 The Borrower has signed the Letter of Option Exercise
in the form attached as Annex A and caused that
Letter of Option Exercise to be delivered to the
Company.
3 The Company is incorporated under the laws of the
state of Florida, maintains its principal place of
business at 740 East 0000 Xxxxx, Xxxxx 000, Xxxx Xxxx
Xxxx, Xxxx 00000, and is a corporation in good
standing as of the date of this agreement.
4 The Company is subject to reporting requirements
prescribed by the Securities and Exchange Commission
(the "SEC") pursuant to the Securities Act of 1933
and its common stock trades publicly. As such, the
Company may need to file with the SEC or otherwise
make public the existence of this agreement and its
terms and conditions.
5 The Company and Borrower represent that this
agreement is valid, binding, and enforceable on its
terms and that all necessary approvals for entering
into this agreement have been obtained.
B Agreements.
1 Through signing the Letter of Option Exercise,
Borrower has exercised options for __________ shares
of the Company's common stock (the "Option Shares"),
with an exercise price of $.128 per share, for a
total exercise price of $_______.
2 The Company has agreed to lend to Borrower $______,
representing the aggregate exercise price for the
Option Shares, on the terms and conditions further
described below (the "Loan").
3 The Loan shall bear no interest and shall be
repayable as hereinafter provided, but in any event
on before December 31, 2004.
4 Collateral for Loan:
a On or before May 23, 2001, the Company will
instruct the transfer agent for its common
stock to issue the Option Shares. Such
shares will be deposited with and held by
the Company as collateral for repayment of
principal or interest pursuant to this
agreement. Borrower will sign and deposit
with the Company, contemporaneously with the
execution of this agreement, a stock power
in the form of Annex B authorizing the
Company to register transfer of the Option
Shares strictly for the purposes of this
agreement. From time to time as necessary to
effect sales of the Option Shares, Borrower
shall execute and deliver additional stock
powers.
b From time to time until the Loan is repaid,
Borrower may request that all or a portion
of the Option Shares be sold at public or
private sale, as Borrower may designate. In
order to effectuate such sale(s), the
Company shall deliver the Option Shares to
such securities broker-dealer as Borrower
may designate against (i) payment of the
exercise price therefor to the Company as
provided in subparagraph B (6)(c) below, or
(ii) the irrevocable agreement of the
recipient to sell such Option Shares and
deliver the proceeds therefrom, net only of
usual and customary commissions or xxxx
downs, to the Company and the Borrower in
accordance with subparagraph (c) below to be
applied against the Loan.
c At such time as the full amount of this Loan
is repaid, the Company will forthwith
deliver the balance of the Option Shares to
Borrower along with the stock power.
d In the event that the Option Shares or any
portion of them remain unsold at the due
date of this Loan, the Company, as secured
party may execute on such shares in
accordance with the Uniform Commercial Code
and apply the proceeds from such sale first
to the payment of expenses, then to the
payment of principal and interest due on the
Loan, and then to the payment of the balance
to Borrower, all in accordance with the
provisions of the Uniform Commercial Code.
The Company may then sell the Option Shares
or return them to its treasury for
cancellation at its election.
5 Voting of Option Shares, Stock Dividends or Stock
Conversions:
a During the period when the Options Shares
are held by the Company, the Company shall
have full proxy and power to vote the shares
in any vote of stockholders.
b In the event that there are any stock
dividends, such dividends will be forwarded
to the Company as additional collateral.
c In the event of any cash dividends, such
dividends will be used to repay the
principal amount of the Loan.
d In the event of reorganization of the
Company involving the exchange or conversion
of the Company's common stock, the Company
will perform the exchanges or conversions
with respect to any Option Shares that are
held as collateral. Any replacement stock or
other securities or instruments will
continue to be held in the name of Borrower
and be subject to the stock power delivered
at the signing of this agreement and to the
terms of this agreement, including but not
limited to sale, use of proceeds, and
release of collateral.
6 Repayment of the Loan:
a The Company and the Borrower agree that the
Loan will be repaid solely from proceeds of
the sale of the Option Shares.
b The Company will cooperate with Borrower to
the full extent necessary to permit the
Borrower to sell the Option Shares,
including depositing the shares with a
licensed broker-dealer for settlement of an
arranged sale. The Company will cause the
proceeds of any sale to be applied as set
forth in subparagraph B (6)(c) below.
c At such time as Borrower arranges for the
sale of all or any portion of the Option
Shares, proceeds from such sale will be
first used to repay the principal amount of
this Loan in an amount equal to the option
exercise price per share as set forth in
paragraph B (1), with the balance payable to
Borrower.
2
7 The Company and the Borrower agree that there shall
be no recourse to Borrower or the assets of Borrower
for repayment of the Loan, and the Loan is to be
repaid solely from proceeds from the sale of the
Option Shares.
8 The Option Shares are not registered under the
Securities Act of 1933 but are being issued in
reliance on an exemption from registration under such
statute. Borrower acknowledges that, unless such
Option Shares are being issued in reliance on Rule
701 promulgated under the Securities Act of 1933, as
advised by the Company at the time of exercise, the
Option Shares constitute restricted securities within
the meaning of that term under Rule 144, the Option
Shares must be taken for investment and not with a
view toward their distribution, and the certificates
representing the Option Shares shall bear a
restrictive legend.
9 The Company has provided to Borrower and Borrower
acknowledges receipt of copies of all reports filed
with the SEC or circulated generally to its
stockholders, in addition to:
a a draft of amendment no. three to its Form
10-SB, dated March 2001, not yet filed with
the SEC; and
b a copy of Borrower's business plan summary
dated April 1, 2001.
The Company will provide to Borrower all future reports filed with the
SEC or generally distributed to its stockholders on a timely basis.
C Signatures.
The parties hereto by their signatures below indicate their acceptance
of and agreement to the terms of this agreement.
Borrower The Company
By __________________________________ By _______________________
Xxx Xxxxxxxx
President and CEO
3
Annex A
Letter of Option Exercise
Schimatic Cash Transactions Xxxxxxx.xxx, Inc.
Subject: Notice of Election To Exercise Stock Options
I am hereby notifying you of my intention to exercise the following stock
options pursuant to the letter of grant by the Board of Directors of Schimatic
Cash Transactions Xxxxxxx.xxx, Inc. dated May 3, 2001.
Date of Grant Number of Shares Exercise Price per Share
-------------------- ----------------------- --------------------------
$0.128
-------------------- ----------------------- --------------------------
The aggregate value of the exercise price of the above options is $__________
and is to be paid from the proceeds of the Collateralized Nonrecourse Loan
Agreement I have entered into as of this date.
Upon issuance of the shares from exercise of the above described options (the
"Option Shares"), the Option Shares should be mailed directly to the Company to
be held as collateral for the Loan agreement.
Please provide all correspondence and materials received pursuant to the
Collateralized Nonrecourse Loan Agreement or related to the Option Shares to me
at the following address:
Signed,
______________________________
[name]
Optionee
Annex B
Stock Power of Attorney
The undersigned hereby designates and appoints Schimatic Cash
Transactions Xxxxxxx.xxx, Inc. as his/her attomey-in-fact (i) for the purpose of
voting all shares of common stock held pursuant to the Collateralized
Nonrecourse Loan Agreement dated May 3,2001 and (ii) authorizing the Company to
register transfer of such shares of common stock for the purposes of the
Collateralized Nonrecourse Loan Agreement dated May 3, 2001.
________________________________
[name]
Optionee
Schedule to Exhibit 10.12
Options have been repriced and exercised under the foregoing as
follows:
Name of Optionee Date Granted Number of Shares Exercise Price
---------------- ------------ ---------------- --------------
Xxxxx X. Xxxxxxxx May 1, 2001 2,500,000 .128
Xxx X. Xxxxxxxxxx May 1, 2001 1,000,000 .128
Xxxxx X. Xxxxxx May 1, 2001 600,000 .128
Xxxx X. Xxxxxxxxxxx May 1, 2001 100,000 .128
Xxxxxxx X. Xxxxx May 1, 2001 1,100,000 .128
Xxxx X. Xxxxxxx May 1, 2001 600,000 .128
Xxxxxx X. Xxxxxxx May 1, 2001 700,000 .128
Xxxxx X. Xxxxxx May 1, 2001 200,000 .128
Xxxxx Xxxxx May 1, 2001 35,000 .128
Matt Magnum May 1, 2001 24,000 .128
Xxx XxXxxxx May 1, 2001 35,000 .128
Xxxxx Xxxxxx May 1, 2001 60,000 .128
Xxxxxxx Xxxxx May 1, 2001 96,000 .128
May 1, 2001 8,333 .128
Xxxxxx Xxxxx May 1, 2001 60,000 .128
Xxxxx Xxxxx May 1, 2001 60,000 .128
Xxx Xxxxxxxxx May 1, 2001 100,000 .128
