Exhibit 4.3
REVOLVING CREDIT AGREEMENT
This
Revolving Credit Agreement (this "Agreement") is made and
entered
into effective as of August 30, 2005 (the
"Effective Date") by and between the
Lender, GCOM Consultants, Inc., a Florida
corporation ("Lender"), and Security
Intelligence Technologies, Inc., a Florida
corporation ("Borrower").
RECITALS
WHEREAS,
the Lender agrees to loan certain sums to Borrower from time to
time, and Borrower wishes to borrow certain
sums from the Lender, on and subject
to the terms and conditions contained in
this Agreement.
NOW,
THEREFORE, in consideration of the mutual promises,
representations,
warranties, covenants and conditions set
forth in this Agreement and for other
good and valuable consideration, the
receipt and adequacy of which are hereby
acknowledged, the Lenders and Borrower
hereby, intending to be legally bound by
the terms hereof, agree as follows:
1. Certain
Definitions. As used herein:
1.1 The term "Business Day" means any day other than a
Saturday,
Sunday, or other day on which commercial
banks in New York, New York are
authorized or required by law to close.
1.2 The term "Credit Period" means that period of time beginning
on
the Effective Date and ending on September
1, 2015.
1.3 The term "Loan Documents" means, collectively, this
Agreement,
the Note (as defined below) executed and
delivered pursuant hereto, and any
other documents executed or delivered by
Borrower pursuant to this Agreement or
in connection with any Loan.
1.4 The term "Maturity Date" means that date on which the
Lender
declares the entire unpaid principal amount
and all accrued interest on each
outstanding Note immediately due and
payable in full under Section 10.
1.5 The term "Monthly Payment" means the monthly amount of
$4,410.47
Borrower has agreed to pay Lender during
the term of this agreement.
2. Amount
and Terms of Credit.
2.1 Commitment to Lend. (a) Subject to the terms and conditions
of
this Agreement, and in reliance on the
representations, warranties and covenants
of Borrower set forth in this Agreement,
Lender agrees to make loans of funds to
Borrower during the Credit Period on a
revolving basis (such loans being
collectively hereinafter referred to as
"Loans" and each individually as a
"Loan"), in an aggregate cumulative total
principal amount not to exceed six
hundred eighty thousand (US $680,000.00)
dollars (the "Commitment").
2.2 Note. Borrower's indebtedness to Lender under each Loan
advanced
by Lender under this Agreement will be
evidenced by a separate Promissory Note
of Borrower in the form attached hereto as
Exhibit "A" (the "Note"). The Note
will provide that interest on unpaid
principal will accrue at a rate equal to
7.025% per annum (calculated on the basis
of a 365/66-day year) compounded
annually (but in no event higher than the
highest lawful rates).
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2.3 Maturity. Loans made pursuant to this Revolving Credit
Agreement
shall be payable on demand.
2.4 Prepayment. Borrower may at any time and from time to time
on
any Business Day prepay any Loan in whole
or in part. Each prepayment will be
applied as follows: (a) first, to the
payment of interest accrued on all Loans
outstanding, and (b) second, to the extent
that the amount of such prepayment
exceeds the amount of all such accrued
interest, to the payment of principal on
such Loan or Loans as Borrower may
designate.
2.5 Monthly Payment. Borrower has agreed to make Monthly Payments
to
Lender of $4,410.47 during the term of this
agreement. The monthly payment will
first be applied to outstanding interest,
then to outstanding principal and the
balance is to be considered a fee for
providing this Revolving Credit Agreement.
3.
Representations and Warranties of Borrower. Borrower hereby
represents
and warrants to Lender that:
3.1 Organization and Standing; Charter Documents. Borrower is a
corporation duly organized, validly
existing and in good standing under the laws
of the State of Florida, and has all
requisite corporate power and authority to
own, lease and operate its properties and
to conduct its business as such is
presently conducted and as proposed to be
conducted. Borrower is duly qualified
to do business as a foreign corporation in
good standing in any state or
jurisdiction in the United States in which
it is required to be qualified to do
intrastate business as the Company's
business is currently conducted, except for
jurisdictions in which failure to so
qualify could not reasonably be expected to
have a material adverse effect on the
business and operations of the Company
taken as a whole. True and accurate copies
of the Certificate of Incorporation
(the "Charter") and Bylaws of Borrower,
each as amended and currently in effect,
have been delivered to Lender and Lender's
counsel.
3.2 Authorization. All corporate action on the part of Borrower
and
its officers, directors and stockholders
that is necessary for the
authorization, execution, delivery and
performance of each of the Loan Documents
by Borrower has been taken; and each of the
Loan Documents, when executed and
delivered by Borrower, will constitute
valid and legally binding obligations of
Borrower, enforceable in accordance with
their terms.
4.
Conditions Precedent to Initial and All Loans. The obligation of
Lender
to make each Loan will be subject to the
satisfaction of all the following
additional conditions precedent:
4.1 No Event of Default. No event will have occurred and be
continuing, and no event would result from
the making of such Loan, that would
constitute an Event of Default as defined
herein.
4.2 Note. Lender will have received the Note representing such
Loan,
executed by a duly authorized officer of
Borrower.
4.3 Representations True. All representations and warranties of
Borrower contained in this Agreement or in
any other Loan Documents will be
true, correct and complete in all respects
with the same effect as though such
representations and warranties had been
made on and as of the date such Loan is
actually advanced (except to the extent
such representations and warranties
specifically relate to an earlier date, in
which case they will be true,
accurate and complete in all material
respects as of such earlier date).
4.4 All Agreements Performed. All agreements, obligations,
conditions and covenants set forth in this
Agreement and all other Loan
Documents to be performed by Borrower
through the date such Loan is advanced
will have been duly performed and complied
with in all respects.
2
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4.5 No Sale Transaction. No Sale Transaction shall have occurred.
A
"Sale Transaction" shall be deemed to have
occurred upon the happening of any of
the following events: (i) a merger or
consolidation of the Borrower with or into
another issuer; or (ii) the exchange or
sale of all or a portion of the
outstanding shares of the Borrower for
securities of another issuer, or other
consideration provided by such issuer or
another party to such transaction; and
in the case of either (i) or (ii), the
Borrower's shareholders prior to the
transaction, do not possess, immediately
after such transaction, more than 50%
of the voting power of the securities
issued and outstanding of any one or more
of the following: (x) the Borrower; (y)
such other issuer; or (z) such other
constituent party to the transaction; or a
sale (other than in the ordinary
course of business) of more than 90% of the
Borrower's assets to a third party
not an affiliate of the Borrower
immediately prior to such transaction.
4.6 As of the Closing Date, the Borrower is a fully reporting
company with the class of securities
registered pursuant to Section 12 (g) of
the Securities and Exchange Act of
1934.
4.7 No material adverse change in the Borrower's business or
business prospects shall have occurred
after the date of the most recent
financial statements.
5. Other
Covenants of Borrower. Borrower hereby covenants and agrees
with
Lender as follows.
5.1 Financial and Other Information and Inspection. During the
Credit Period, Borrower will provide to
Lender all the reports and rights
described below in this Section 9.1:
(a) Annual Financial Information. As soon as practicable after
the end of each fiscal year of Borrower,
but no later than one hundred twenty
(120) days thereafter, an audited
consolidated balance sheet of Borrower and its
subsidiaries as at the end of such fiscal
year, and consolidated statements of
income and cash flows of Borrower and its
subsidiaries for such year, prepared
in accordance with generally accepted
accounting principles and setting forth in
each case in comparative form the financial
statements for the previous fiscal
year, all in reasonable detail and audited
and certified by independent public
accountants acceptable to Lender.
(b) Quarterly Financial Information. As soon as practicable
after the end of each fiscal quarter of
Borrower, and in any event within
forty-five (45) days thereafter, an
unaudited consolidated balance sheet of
Borrower and its subsidiaries as at the end
of such quarter and consolidated
statements of income and cash flows of
Borrower and its subsidiaries for each
such quarter and for the fiscal year to
date, prepared in accordance with
generally accepted accounting principles,
all in reasonable detail.
(c) Inspection Rights. The right to visit and inspect any of
the properties of Borrower or any of its
subsidiaries, and to discuss its and
their affairs and finances with its and
their officers, all at such reasonable
times and as often as may reasonably be
requested by Lender.
(d) Other Information. With reasonable promptness, such other
information and data, including, without
limitation, lists of property and
accounts, budgets, agreements with
insurers, forecasts, tax returns and reports,
with respect to Borrower and its
subsidiaries as may from time to time may be
reasonably requested by Lender, and all
such other information and
communications (including, without
limitation, notices of meetings of Borrower's
shareholders) as Borrower will have
supplied to its holders of any shares of its
capita
