UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): September 2, 2014
PLC SYSTEMS INC.
(Exact name of registrant as specified in its charter)
|
Yukon Territory, Canada |
1-11388 |
04-3153858 |
|
(State or other Jurisdiction of Incorporation or Organization) |
(Commission File No.) |
(IRS Employer Identification No.) |
|
PLC Systems Inc. 459 Fortune Boulevard Milford, Massachusetts |
01757 |
|
(Address of principal executive offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (508) 541-8800
|
Not Applicable |
| (Former Name or Former Address, if Changed Since Last Report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
On September 2, 2014, PLC Systems Inc. (the “Company”) issued to GCP IV LLC (“GCP”) an unsecured promissory note for an aggregate principal amount of $250,000 (the “Note”). The Note bears interest at a rate of 5% per annum, payable in arrears on the maturity date, which occurs on the earlier of (i) September 2, 2017 and (b) the date on which all amounts under the Note become due and payable pursuant to an event of default.
The Note is unsecured and may be prepaid, without premium or penalty, at any time. The Note contains covenants restricting the Company from, among other things, incurring debt, granting liens, and entering into a new line of business. Following an event of default, the interest rate on the Note will increase to 16% per annum and, at the election of the holder, the entire principal amount together with all accrued interest on the Note may be accelerated. Under the terms of the Note, an event of default includes, among other things, failure to make a timely payment, breach of covenants or representations and warranties under the Note, cross-defaults, initiation of a bankruptcy or insolvency proceeding of the Company and judgments entered against the Company.
In connection with the issuance of the Note, the Company entered into a Debenture Amendment Agreement, dated September 2, 2014 (the “Amendment”), with certain investors holding a majority of the outstanding senior secured debentures sold pursuant to that certain Securities Purchase Agreement, dated February 22, 2011, as amended (collectively, the “Debentures”). Pursuant to the terms of the Amendment, the Debentures were revised to permit up to $500,000 of indebtedness for borrowed money.
The foregoing description of the transactions contemplated by the Note and the Amendment is not complete and is qualified in its entirety by reference to the full text of the Note, a copy of which is filed with this Current Report as Exhibit 10.1, and the Amendment, a copy of which is filed with this Current Report as Exhibit 10.2, which are incorporated by reference herein.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information provided in Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
|
Number |
Exhibit |
|
10.1 |
Promissory Note, dated September 2, 2014, issued by the Company to GCP IV LLC. |
|
10.2 |
Debenture Amendment Agreement, dated September 2, 2014, by and between the Company and GCP IV LLC. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
Dated: September 8, 2014 |
|
PLC SYSTEMS INC. |
|
|
|
|
|
|
| By: | /s/ Gregory W. Mann | ||
|
|
|
Gregory W. Mann |
|
| Chief Financial Officer |
Exhibit 10.1
PROMISSORY NOTE
FOR VALUE RECEIVED, and subject to the terms and conditions set forth herein, PLC SYSTEMS, a Yukon Territory corporation (the “Borrower”), hereby unconditionally promises to pay to the order of GCP IV LLC or its assigns (the “Noteholder”, and together with the Borrower, the “Parties”), the principal amount of $250,000 (the “Loan”), together with all accrued interest thereon, as provided in this Promissory Note (the “Note”).
1. Definitions. Capitalized terms used herein shall have the meanings set forth in this Section 1.
“Affiliate” means as to any Person, any other Person that, directly or indirectly through one or more intermediaries, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the securities having ordinary voting power for the election of directors (or persons performing similar functions) of such Person or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.
“Applicable Rate” means the rate equal to five percent (5%) per annum.
“Borrower” has the meaning set forth in the introductory paragraph.
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close.
“Debt” of the Borrower, means all (a) indebtedness for borrowed money; (b) obligations for the deferred purchase price of property or services, except trade payables arising in the ordinary course of business; (c) obligations evidenced by notes, bonds, debentures or other similar instruments; (d) obligations as lessee under capital leases; (e) obligations in respect of any interest rate swaps, currency exchange agreements, commodity swaps, caps, collar agreements or similar arrangements entered into by the Borrower providing for protection against fluctuations in interest rates, currency exchange rates or commodity prices or the exchange of nominal interest obligations, either generally or under specific contingencies; (f) obligations under acceptance facilities and letters of credit; (g) guaranties, endorsements (other than for collection or deposit in the ordinary course of business), and other contingent obligations to purchase, to provide funds for payment, to supply funds to invest in any Person, or otherwise to assure a creditor against loss, in each case, in respect of indebtedness set out in clauses (a) through (f) of a Person other than the Borrower; and (h) indebtedness set out in clauses (a) through (g) of any Person other than Borrower secured by any lien on any asset of the Borrower, whether or not such indebtedness has been assumed by the Borrower.
“Default” means any of the events specified in Section 8 which constitutes an Event of Default or which, upon the giving of notice, the lapse of time, or both pursuant to Section 8 would, unless cured or waived, become an Event of Default.
“Default Rate” means, at any time, sixteen percent (16%).
“Event of Default” has the meaning set forth in Section 8.
“GAAP” means generally accepted accounting principles in the United States of America as in effect from time to time.
“Governmental Authority” means the government of any nation or any political subdivision thereof, whether at the national, state, territorial, provincial, municipal or any other level, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of, or pertaining to, government (including any supranational bodies such as the European Union or the European Central Bank).
“Law” as to any Person, means any law (including common law), statute, ordinance, treaty, rule, regulation, policy or requirement of any Governmental Authority and authoritative interpretations thereon, whether now or hereafter in effect, in each case, applicable to or binding on such Person or any of its properties or to which such Person or any of its properties is subject.
“Lien” means any mortgage, pledge, hypothecation, encumbrance, lien (statutory or other), charge or other security interest.
“Loan” has the meaning set forth in the introductory paragraph.
“Material Adverse Effect” means a material adverse effect on (a) the business, assets, properties, liabilities (actual or contingent), operations, condition (financial or otherwise) or prospects of the Borrower; (b) the validity or enforceability of the Note; (c) the rights or remedies of the Noteholder hereunder; or (d) the Borrower’s ability to perform any of its material payment obligations hereunder.
“Maturity Date” means the earlier of (a) September 2, 2017 and (b) the date on which all amounts under this Note shall become due and payable pursuant to Section 9.
“Note” has the meaning set forth in the introductory paragraph.
“Noteholder” has the meaning set forth in the introductory paragraph.
“Order” as to any Person, means any order, decree, judgment, writ, injunction, settlement agreement, requirement or determination of an arbitrator or a court or other Governmental Authority, in each case, applicable to or binding on such Person or any of its properties or to which such Person or any of its properties is subject.
“Parties” has the meaning set forth in the introductory paragraph.
“Permitted Debt” means Debt (a) existing or arising under this Note and any refinancing thereof; (b) existing as of the date of this Note; (c) which may be deemed to exist with respect to swap contracts; (d) owed in respect of any netting services, overdrafts and related liabilities arising from treasury, depository and cash management services in connection with any automated clearinghouse transfers of funds; and (e) unsecured insurance premiums owing in the ordinary course of business.
“Person” means any individual, corporation, limited liability company, trust, joint venture, association, company, limited or general partnership, unincorporated organization, Governmental Authority or other entity.
2. Final Payment Date; Optional Prepayments.
(a) Final Payment Date. The aggregate unpaid principal amount of the Loan, all accrued and unpaid interest and all other amounts payable under this Note shall be due and payable on the Maturity Date.
(b) Optional Prepayment. The Borrower may prepay the Loan in whole or in part at any time or from time to time without penalty or premium by paying the principal amount to be prepaid together with accrued interest thereon to the date of prepayment. No prepaid amount may be reborrowed.
3. Interest.
(a) Interest Rate. Except as otherwise provided herein, the outstanding principal amount of the Loan made hereunder shall bear interest at the Applicable Rate from the date the Loan was made until the Loan is paid in full, whether at maturity, upon acceleration, by prepayment or otherwise.
(b) Interest Payment Date. Interest shall be payable in arrears to the Noteholder on the Maturity Date.
(c) Default Interest. If any amount payable hereunder is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such overdue amount shall bear interest at the Default Rate from the date of such non-payment until such amount is paid in full.
(d) Computation of Interest. All computations of interest shall be made on the basis of a year of 360 days, as the case may be, and the actual number of days elapsed. Interest shall accrue on the Loan on the day on which the Loan is made, and shall not accrue on the Loan for the day on which it is paid.
(e) Interest Rate Limitation. If at any time and for any reason whatsoever, the interest rate payable on the Loan shall exceed the maximum rate of interest permitted to be charged by the Noteholder to the Borrower under applicable Law, that portion of each sum paid attributable to that portion of such interest rate that exceeds the maximum rate of interest permitted by applicable Law shall be deemed a voluntary prepayment of principal.
4. Payment Mechanics.
(a) Manner of Payments. All payments of interest and principal shall be made in lawful money of the United States of America no later than 12:00 PM Eastern Time on the date on which such payment is due by cashier’s check, certified check or by wire transfer of immediately available funds to the Noteholder’s account at a bank specified by the Noteholder in writing to the Borrower from time to time.
(b) Application of Payments. All payments made hereunder shall be applied first to the payment of any fees or charges outstanding hereunder, second to accrued interest, and third to the payment of the principal amount outstanding under the Note.
(c) Business Day Convention. Whenever any payment to be made hereunder shall be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension will be taken into account in calculating the amount of interest payable under this Note.
(d) Evidence of Debt. The Noteholder is authorized to record on the grid attached hereto as Exhibit A the Loan made to the Borrower and each payment or prepayment thereof. The entries made by the Noteholder shall, to the extent permitted by applicable Law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided, however, that the failure of the Noteholder to record such payments or prepayments, or any inaccuracy therein, shall not in any manner affect the obligation of the Borrower to repay (with applicable interest) the Loan in accordance with the terms of this Note.
(e) Rescission of Payments. If at any time any payment made by the Borrower under this Note is rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy or reorganization of the Borrower or otherwise, the Borrower’s obligation to make such payment shall be reinstated as though such payment had not been made.
5. Representations and Warranties. The Borrower hereby represents and warrants to the Noteholder on the date hereof as follows:
(a) Existence; Compliance With Laws. The Borrower is (i) a corporation duly incorporated, validly existing and in good standing under the laws of the state of its jurisdiction of organization and has the requisite power and authority, and the legal right, to own, lease and operate its properties and assets and to conduct its business as it is now being conducted and (ii) in compliance with all Laws and Orders except to the extent that the failure to comply therewith would not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
(b) Power and Authority. The Borrower has the power and authority, and the legal right, to execute and deliver this Note and to perform its obligations hereunder.
(c) Authorization; Execution and Delivery. The execution and delivery of this Note by the Borrower and the performance of its obligations hereunder have been duly authorized by all necessary corporate action in accordance with all applicable Laws. The Borrower has duly executed and delivered this Note.
(d) No Approvals. No consent or authorization of, filing with, notice to or other act by, or in respect of, any Governmental Authority or any other Person is required in order for the Borrower to execute, deliver, or perform any of its obligations under this Note.
(e) No Violations. The execution and delivery of this Note and the consummation by the Borrower of the transactions contemplated hereby do not and will not (i) violate any provision of the Borrower’s organizational documents; (ii) violate any Law or Order applicable to the Borrower or by which any of its properties or assets may be bound; or (iii) constitute a default under any material agreement or contract by which the Borrower may be bound.
(f) Enforceability. The Note is a valid, legal and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).
(g) No Litigation. No action, suit, litigation, investigation or proceeding of, or before, any arbitrator or Governmental Authority is pending or, to the knowledge of the Borrower, threatened by or against the Borrower or any of its property or assets (i) with respect to the Note or any of the transactions contemplated hereby or (ii) that would be expected to materially adversely affect the Borrower’s financial condition or the ability of the Borrower to perform its obligations under the Note.
6. Affirmative Covenants. Until all amounts outstanding in this Note have been paid in full, the Borrower shall:
(a) Maintenance of Existence. (i) Preserve, renew and maintain in full force and effect its corporate or organizational existence and (ii) take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, where the failure to do so would not reasonably be expected to have a Material Adverse Effect.
(b) Compliance. Comply with (i) all of the terms and provisions of its organizational documents; (ii) its obligations under its material contracts and agreements; and (iii) all Laws and Orders applicable to it and its business, except where the failure to do so would not reasonably be expected to have a Material Adverse Effect.
(c) Payment Obligations. Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its material obligations of whatever nature, except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings, and reserves in conformity with GAAP with respect thereto have been provided on its books.
(d) Notice of Events of Default. As soon as possible and in any event within two (2) Business Days after it becomes aware that a Default or an Event of Default has occurred, notify the Noteholder in writing of the nature and extent of such Default or Event of Default and the action, if any, it has taken or proposes to take with respect to such Default or Event of Default.
(e) Further Assurances. Upon the request of the Noteholder, promptly execute and deliver such further instruments and do or cause to be done such further acts as may be necessary or advisable to carry out the intent and purposes of this Note.
7. Negative Covenants. Until all amounts outstanding under this Note have been paid in full, the Borrower shall not:
(a) Indebtedness. Incur, create or assume any Debt, other than Permitted Debt.
(b) Liens. Incur, create, assume or suffer to exist any Lien on any of its property or assets, whether now owned or hereinafter acquired except for (i) Liens for taxes not yet due or which are being contested in good faith by appropriate proceedings; and (ii) non-consensual Liens arising by operation of law, arising in the ordinary course of business, and for amounts which are not overdue for a period of more than 30 days or that are being contested in good faith by appropriate proceedings.
(c) Line of Business. Enter into any business, directly or indirectly, except for those businesses in which the Borrower is engaged on the date of this Note or that are reasonably related thereto.
8. Events of Default. The occurrence and continuance of any of the following shall constitute an Event of Default hereunder:
(a) Failure to Pay. The Borrower fails to pay (i) any principal amount of the Loan when due or (ii) interest or any other amount when due and such failure continues for 5 days.
(b) Breach of Representations and Warranties. Any representation or warranty made or deemed made by the Borrower to the Noteholder herein is incorrect in any material respect on the date as of which such representation or warranty was made or deemed made.
(c) Breach of Covenants. The Borrower fails to observe or perform (i) any covenant, condition or agreement contained in Section 6(d) or (ii) any other material covenant, obligation, condition or agreement contained in this Note other than those specified in clause (i) and Section 8(a) and such failure continues for 30 days.
(d) Cross-Defaults. The Borrower fails to pay when due any of its Debt (other than Debt arising under this Note) or any interest or premium thereon when due (whether by scheduled maturity, acceleration, demand or otherwise) and such failure continues after the applicable grace period, if any, specified in the agreement or instrument relating to such Debt.
(e) Bankruptcy.
(i) the Borrower commences any case, proceeding or other action (A) under any existing or future Law relating to bankruptcy, insolvency, reorganization, or other relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it as bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Borrower makes a general assignment for the benefit of its creditors;
(ii) there is commenced against the Borrower any case, proceeding or other action of a nature referred to in Section 8(e)(i) above which (A) results in the entry of an order for relief or any such adjudication or appointment or (ii) remains undismissed, undischarged or unbonded for a period of 30 days;
(iii) there is commenced against the Borrower any case, proceeding or other action seeking issuance of a warrant of attachment, execution or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief which has not been vacated, discharged, or stayed or bonded pending appeal within 30 days from the entry thereof;
(iv) the Borrower takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in Section 8(e)(i), Section 8(e)(ii) or Section 8(e)(iii) above; or
(v) the Borrower is generally not, or shall be unable to, or admits in writing its inability to, pay its debts as they become due.
(f) Judgments. One or more judgments or decrees shall be entered against the Borrower and all of such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 30 days from the entry thereof.
9. Remedies. Upon the occurrence of any Event of Default and at any time thereafter during the continuance of such Event of Default, the Noteholder may at its option, by written notice to the Borrower (a) declare the entire principal amount of this Note, together with all accrued interest thereon and all other amounts payable hereunder, immediately due and payable; and/or (b) exercise any or all of its rights, powers or remedies under applicable Law; provided, however that, if an Event of Default described in Section 8(e) shall occur, the principal of and accrued interest on the Loan shall become immediately due and payable without any notice, declaration or other act on the part of the Noteholder.
10. Miscellaneous.
(a) Notices.
(i) All notices, requests or other communications required or permitted to be delivered hereunder shall be delivered in writing, in each case to the address specified below or to such other address as such Party may from time to time specify in writing in compliance with this provision:
|
|
(A) |
If to the Borrower: |
| 459 Fortune Boulevard | ||
| Milford, MA 01757 | ||
| Attn: Mark R. Tauscher | ||
| Telephone: (508) 541-8800 | ||
| Facsimile: (508) 541-7990 | ||
| E-mail: mtauscher@plcmed.com | ||
| (B) | If to the Noteholder: | |
| 1212 Avenue of the Americas, 19th Floor | ||
| New York, NY 10036 | ||
| Attn: Ethan Benovitz | ||
| Telephone: (212) 798-1364 | ||
| Facsimile: | ||
| E-mail: ebenovitz@genesiscm.com |
(ii) Notices if (A) mailed by certified or registered mail or sent by hand or overnight courier service shall be deemed to have been given when received; (B) sent by facsimile during the recipient’s normal business hours shall be deemed to have been given when sent (and if sent after normal business hours shall be deemed to have been given at the opening of the recipient’s business on the next business day); and (C) sent by e-mail shall be deemed received upon the sender’s receipt of an acknowledgment from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgment).
(b) Expenses. The Borrower shall reimburse the Noteholder on demand for all reasonable out-of-pocket costs, expenses and fees (including reasonable expenses and fees of its counsel) incurred by the Noteholder in connection with the transactions contemplated hereby including the negotiation, documentation and execution of this Note and the enforcement of the Noteholder’s rights hereunder.
(c) Governing Law. This Note and any claim, controversy, dispute or cause of action (whether in contract or tort or otherwise) based upon, arising out of or relating to this Note, and the transactions contemplated hereby shall be governed by the laws of the State of New York.
(d) Submission to Jurisdiction.
(i) The Borrower hereby irrevocably and unconditionally (A) agrees that any legal action, suit or proceeding arising out of or relating to this Note may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York and (B) submits to the exclusive jurisdiction of any such court in any such action, suit or proceeding. Final judgment against the Borrower in any action, suit or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment.
(ii) Nothing in this Section 10(d) shall affect the right of the Noteholder to (A) commence legal proceedings or otherwise sue the Borrower in any other court having jurisdiction over the Borrower or (B) serve process upon the Borrower in any manner authorized by the laws of any such jurisdiction.
(e) Venue. The Borrower irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Note in any court referred to in Section 10(d) and the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(f) Waiver of Jury Trial. THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY RELATING TO THIS NOTE OR THE TRANSACTIONS CONTEMPLATED HEREBY WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY.
(g) Counterparts; Integration; Effectiveness. This Note and any amendments, waivers, consents or supplements hereto may be executed in counterparts, each of which shall constitute an original, but all taken together shall constitute a single contract. This Note constitutes the entire contract between the Parties with respect to the subject matter hereof and supersede all previous agreements and understandings, oral or written, with respect thereto. Delivery of an executed counterpart of a signature page to this Note by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be effective as delivery of a manually executed counterpart of this Note.
(h) Successors and Assigns. This Note may be assigned or transferred by the Noteholder to any Person. The Borrower may not assign or transfer this Note or any of its rights hereunder without the prior written consent of the Noteholder. This Note shall inure to the benefit of, and be binding upon, the Parties and their permitted assigns.
(i) Waiver of Notice. The Borrower hereby waives demand for payment, presentment for payment, protest, notice of payment, notice of dishonor, notice of nonpayment, notice of acceleration of maturity and diligence in taking any action to collect sums owing hereunder.
(j) Interpretation. For purposes of this Note (i) the words “include,” “includes” and “including” shall be deemed to be followed by the words “without limitation”; (ii) the word “or” is not exclusive; and (iii) the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this Note as a whole. The definitions given for any defined terms in this Note shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. Unless the context otherwise requires, references herein: (x) to Schedules, Exhibits and Sections mean the Schedules, Exhibits and Sections of this Note; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof; and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Note shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted.
(k) Amendments and Waivers. No term of this Note may be waived, modified or amended except by an instrument in writing signed by both of the parties hereto. Any waiver of the terms hereof shall be effective only in the specific instance and for the specific purpose given.
(l) Headings. The headings of the various Sections and subsections herein are for reference only and shall not define, modify, expand or limit any of the terms or provisions hereof.
(m) No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising on the part of the Noteholder, of any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.
(n) Electronic Execution. The words “execution,” “signed,” “signature,” and words of similar import in the Note shall be deemed to include electronic or digital signatures or the keeping of records in electronic form, each of which shall be of the same effect, validity and enforceability as manually executed signatures or a paper-based recordkeeping system, as the case may be, to the extent and as provided for under applicable law, including the Electronic Signatures in Global and National Commerce Act of 2000 (15 USC § 7001 et seq.), the Electronic Signatures and Records Act of 1999 (N.Y. State Tech. Law §§ 301-309), or any other similar state laws based on the Uniform Electronic Transactions Act.
(o) Severability. If any term or provision of this Note is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Note or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Note so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Borrower has executed this Note as of September 2, 2014.
|
|
PLC SYSTEMS INC. |
|
|
By: /s/ Gregory W. Mann |
|
|
Name: Gregory W. Mann |
| Title: Chief Financial Officer |
EXHIBIT A
PAYMENTS ON THE LOAN
|
Amount of Principal Paid
|
Unpaid Principal Amount of Note
|
Name of Person Making the Notation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
Exhibit 10.2
DEBENTURE AMENDMENT AGREEMENT
THIS DEBENTURE AMENDMENT AGREEMENT (this “Amendment”), effective as of September 2, 2014 (the “Effective Date”), is entered into among PLC SYSTEMS INC., a Yukon Territory corporation (the “Company”), and each holder of the Company’s 5% Senior Secured Convertible Debentures (the “Holders,” and each a “Holder”), that has executed the signature page hereto.
WHEREAS, the Company is a party to that certain Securities Purchase Agreement, made as of February 22, 2011, as amended to date, pursuant to which the Company issued convertible senior secured debentures to the Holders in the principal amount of $5,391,355 (collectively, the “Debentures”);
WHEREAS, the Debentures may be amended upon the written consent of the Company and the holders of a majority in principal amount of the then outstanding Debentures, and
WHEREAS, the Holders hold a majority in principal amount of the outstanding Debentures.
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:
1. Modification of Debentures. The Company and the Holders hereby agree that the definition of “Permitted Indebtedness” in Section 1 of the Debentures is hereby amended and restated in its entirety as follows:
“4.20 Permitted Indebtedness. means (x) the indebtedness evidenced by the Debentures and the Other Debentures and the other Transaction Documents, (y) capital lease obligations and purchase money indebtedness of up to $200,000, in the aggregate, incurred in connection with the acquisition of capital assets and lease obligations with respect to newly acquired or leased assets and (z) up to $500,000 of indebtedness for borrowed money.”
2. Binding Effect; Ratification. The Debentures, as amended by this Amendment, continue to be obligations of the Company and the Holders. All provisions of the Debentures remain in full force and effect as therein written, except as amended hereby.
3. Construction and Choice of Law. This Amendment may be executed in several identical counterparts all of which shall constitute one and the same instrument. This Amendment shall be construed and enforced in accordance with the laws of the State of New York and applicable United States federal law.
4. Notice of Final Agreement. This Amendment embodies the entire agreement and understanding between the parties with respect to modifications of documents provided for herein and supersedes all prior conflicting or inconsistent agreements, consents and understandings relating to such subject matter, and may not be contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the parties. There are no unwritten oral agreements between the parties.
[signature page follows]
Executed to be effective as of September 2, 2014.
|
THE COMPANY: |
HOLDERS: |
| |||
|
|
|
|
|
| |
| PLC SYSTEMS INC. | GCP IV LLC | ||||
| By: | /s/ Mark R. Tauscher | By: | /s/ Ethan Benovitz | ||
| Name: Mark R. Tauscher | Name: Ethan Benovitz | ||||
|
|
Title: Chief Executive Officer |
|
Title: Managing Member |
| |
| Principal Amount of Debentures: $5,000,000 | |||||
| ALPHA CAPITAL ANSTALT | |||||
| By: | |||||
| Name: Konrad Ackermann | |||||
| Title: Director | |||||
| Principal Amount of Debentures: $150,000 | |||||
| BRIO CAPITAL MASTER FUND LTD. | |||||
| By: | |||||
| Name: Shaye Hirsch | |||||
| Title: Director | |||||
| Principal Amount of Debentures: $150,000 | |||||
| DENVILLE & DOVER FUND LLC | |||||
| By: | |||||
| Name: Edward Karr | |||||
| Title: Manager | |||||
| Principal Amount of Debentures: $19,355 | |||||
Signature Page to
Debenture Amendment Agreement
2