Exhibit 10.108


    
      

    


    Exhibit
      10.108

     

    
      	 	 	 	 	 
	
              

            	
                

            	
              Royal
                Bank of Canada

              Royal
                Centre Business Markets

              36th
                Floor, 1055 West Georgia St

              Vancouver,
                B.C. VOE 3S5

            
	
                

            	
              Tel.:  604-665-8474

            
	
                

            	
              Fax:  604-665-6368

            


    

     

    March 15,
      2006 

     

    Private
      and Confidential 

     

    Verichip
      Holdings Inc. 

    Suite
      100
      13551 Commerce Parkway 

    Richmond,
      B.C. 

    V6V
      2L1


     

    Attention:
      Mr. Nurez Khimji, C.F.O. 

     

    ROYAL
      BANK OF CANADA (the “Bank”)
      hereby
      confirms the credit facilities described below (the “Credit
      Facilities”)
      subject
      to the terms and conditions set forth below and in the attached Terms &
Conditions and Schedules (collectively the “Agreement”).
      This
      Agreement supersedes and cancels the existing agreement dated April 18,
      2005 and any amendments thereto. Any amount owing by the Borrower to the Bank
      under such previous agreement is deemed to be a Borrowing under this Agreement.
      Any and all security that has been delivered to the Bank and is set forth as
      Security below, shall remain in full force and effect, is expressly reserved
      by
      the Bank and shall apply in respect of all obligations of the Borrower under
      the
      Credit Facilities. Unless otherwise provided, all dollar amounts are in Canadian
      currency. 

     

    BORROWER:
      VERICHIP
      HOLDINGS INC., (formerly Verichip Inc.) (the “Borrower”)
      

     

    CREDIT
      FACILITIES 

     

    Facility
      (1):
      $1,500,000.00 revolving demand facility by way of: 

     

    
      	
              a)

            	
              RBP
                based loans (“RBP
                Loans”)
                

            


    

     

    
      	 	 	 	 	 
	 	
              Revolve
                in increments of:

            	
              $5,000.00

            	
              Minimum
                retained balance:

            	
              $0.00

            
	 	
              Revolved
                by:

            	
              Bank

            	
              Interest
                rate (per annum):

            	
              RBP + 1.00%

            


    

     

    
      	
              b)

            	
              RBUSBR
                based loans in US currency (“RBUSBR
                Loans”)
                

            


    

     

    
      	 	 	 	 	 
	 	
              Revolve
                in increments of:

            	
              $5,000.00

            	
              Minimum
                retained balance

            	
              $0.00

            
	 	
              Revolved
                by:

            	
              Bank

            	
              Interest
                rate (per annum):

            	
              RBUSBR
                + 1.00%

            


    

     

    
      	
              c)

            	
              Letters
                of Credit in Canadian currency (“LCs”)
                

            
	 	 
	 	Fees to be
              advised on a
              transaction-by-transaction basis. Fees and drawings to be charged to
              Borrower’s accounts. 


    

     

    
      	
              d)

            	
              Letters
                of Guarantee in Canadian currency (“LGs”)
                

            
	 	 
	 	
              Fees
                and drawings to be charged to Borrower’s accounts. Minimum fee of $100
                

            


    

     

    
      
        

      

    

    ®
      Registered Trademark of Royal Bank of Canada 

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    AVAILABILITY 

     

    The
      Borrower may borrow, convert, repay and reborrow up to the amount of this
      facility provided this facility is made available at the sole discretion of
      the
      Bank and the Bank may cancel or restrict the availability of any unutilized
      portion at any time and from time to time. 

     

    Borrowings
      outstanding under this facility must not exceed at any time the aggregate of
      the
      following, less Potential Prior-Ranking Claims (the “Borrowing
      Limit”):
      

     

    
      	
              a)

            	
              75%
                of Good Accounts Receivable; 

            


    

     

    
      	
              b)

            	
              85%
                of Good EDC Accounts Receivable; 

            


    

     

    
      	
              c)

            	
              to
                a maximum of $375,000, 25% of the lesser of cost or net realizable
                value
                of Unencumbered Inventory. 

            


    

     

    REPAYMENT 

     

    Notwithstanding
      compliance with the covenants and all other terms and conditions of this
      Agreement, and regardless of the maturities of any outstanding instruments
      or
      contracts, Borrowings under this facility are repayable on demand. 

     

    GENERAL
      ACCOUNT 

     

    The
      Borrower shall establish currents accounts with the Bank in each of Canadian
      currency and US currency (each a “General Account”) for the conduct of the
      Borrower’s day-to-day banking business. The Borrower authorizes the Bank daily
      or otherwise as and when determined by the Bank, to ascertain the balance of
      each General Account and: 

     

    
      	
              a)

            	
              if
                such position is a debit balance the Bank may, subject to the revolving
                increment amount and minimum retained balance specified in this Agreement,
                make available a Borrowing by way of RBP Loans, or RBUSBR Loans as
                applicable, under this facility; 

            


    

     

    
      	
              b)

            	
              if
                such position is a credit balance, where the facility is indicated
                to be
                Bank revolved, the Bank may, subject to the revolving increment amount
                and
                minimum retained balance specified in this Agreement, apply the amount
                of
                such credit balance or any part as a repayment of any Borrowings
                outstanding by way of RBP Loans, or RBUSBR Loans as applicable, under
                this
                facility. 

            


    

     

    OTHER
      FACILITIES: 

     

    The
      Credit Facilities are in addition to the following facilities (the “Other
      Facilities”).
      The
      Other Facilities will be governed by this Agreement and separate agreements
      between the Borrower and the Bank. In the event of a conflict between this
      Agreement and any such separate agreement, the terms of the separate agreement
      will govern. 

     

    
      	
              a)

            	
              Canadian
                $ VISA Business to a maximum amount of $50,000.00;
                

            


    

     

    
      	
              b)

            	
              US$
                VISA Gold to a maximum amount of US$165,000.00.


            


    

     

    FEES: 

     

    
      	 	 	 
	
              One
                Time Fee:

            	
                

            	
              Monthly
                Fee:

            
	 	 
	
              Payable
                upon acceptance of this Agreement.

            	
                

            	
              Payable
                in arrears on the same day of each month.

            
	 	 
	
              Arrangement
                Fee: $400.00

            	
                

            	
              Revolvement
                Fee: $100.00 

            


    

     

    SECURITY 

     

    Security
      for the Borrowings and all other obligations of the Borrower to the Bank
      (collectively, the “Security”),
      shall
      include: 

     

    
      	
               

            	
              a)

            	
              General
                security agreement on the Bank’s Form 924 covering all personal property
                of the Borrower; 

            


    

     

    
      	
               

            	
              b)

            	
              Guarantee
                and postponement of claim on the Bank’s Form 812 In the amount of
                $2,000,000 provided by Verichip Corporation, (the “Guarantor”);
                

            


    

     

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      2 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    
      	
               

            	
              c)

            	
              Consent
                and confirmation letter signed by the Borrower;


            


    

     

    
      	
               

            	
              d)

            	
              Copy
                of Export Development Corporation (“EDC”) E6 Direction to Pay - assignment
                of accounts receivable guarantee from EDC authorization EDC to pay
                the
                Bank directly any amounts that may become payable under the policy.
                Copy
                of EDC Export Credit Insurance Policy with endorsement details and
                General
                Terms & Condition Agreement.


            


    

     

    REPORTING
      REQUIREMENTS 

     

    The
      Borrower will provide the following to the Bank: 

     

    
      	
              a)

            	
              monthly
                Borrowing Limit Certificate substantially In the form of Schedule
                “D”,
                together with an aged list of accounts receivable for the Borrower,
                identifying those accounts with EDC insurance, and a copy of EDC’s monthly
                declaration form confirming that the Borrower is current in paying
                insurance premiums and including a report of any EDC insured receivables
                that are more than 90 days past due, within 30 days of each month
                end;
                

            


    

     

    
      	
              b)

            	
              monthly
                aged listing of accounts receivables for Verichip Corporation within
                30
                days of each month end; 

            


    

     

    
      	
              c)

            	
              quarterly
                company prepared consolidated financial statements for the Borrower
                and
                the Guarantor, in accordance with US GAAP in US dollars, within 45
                days of each fiscal quarter end; 

            


    

     

    
      	
              d)

            	
              quarterly
                company prepared unit financial statements In US dollars for the
                Borrower
                and Guarantor, within 45 days of each fiscal quarter end;
                

            


    

     

    
      	
              e)

            	
              annual
                audited consolidated financial statements for Verichip Corp. with
                audited
                consolidated schedules for the Borrower and the Guarantor, in accordance
                with US GAAP in US dollars within 120 days of each fiscal year end;
                

            


    

     

    
      	
              f)

            	
              annual
                management prepared financial forecasts with quarterly breakdowns,
                in US
                dollars, within 120 days of each fiscal year end; and
                

            


    

     

    
      	
              g)

            	
              such
                other financial and operating statements and reports as and when
                the Bank
                may reasonably require. 

            


    

     

    CONDITIONS
      PRECEDENT 

     

    In
      no
      event will the Credit Facilities or any part thereof be available unless the
      Bank has received: 

     

    
      	
              a)

            	
              a
                duly executed copy of this Agreement;


            


    

     

    
      	
              b)

            	
              the
                Security provided for herein, registered, as required, to the satisfaction
                of the Bank; 

            


    

     

    
      	
              c)

            	
              such
                financial and other information or documents relating to the Borrower
                or
                any Guarantor if applicable as the Bank may reasonably require; and
                

            


    

     

    
      	
              d)

            	
              such
                other authorizations, approvals, opinions and documentation as the
                Bank
                may reasonably require. 

            


    

     

    Additionally;
      

     

    
      	
              e)

            	
              monthly
                confirmation from EDC that Borrower is up to date In paying its insurance
                premiums; 

            


    

     

    
      	
              f)

            	
              copy
                of report to EDC, on accounts receivable greater than 90 days, for
                follow
                up on collections as required; and 

            


    

     

    
      	
              g)

            	
              all
                documentation to be received by the Bank shall be in form and substance
                satisfactory to the Bank. 

            


    

     

    GOVERNING
      LAW JURISDICTION 

     

    Province
      of British Columbia. 

     

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      3 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    ACCEPTANCE
      

     

    This
      Agreement is open for acceptance until April 14, 2006, after which date it
      will be null and void, unless extended in writing by the Bank. 

     

    
      	 	 	 
	
              ROYAL
                BANK OF CANADA

            
	 	 
	
              Per:

            	
               

            	
              /s/
                Rahim Kurji

            
	
              Name:

            	
               

            	
              Rahim
                Kurji

            
	
              Title:

            	
               

            	
              Account
                Manager

            


    

     

    We
      acknowledge and accept the terms and conditions of this Agreement on this 27
      day
      of March, 2006. 

     

    
      	 	 	 
	
              VERICHIP
                HOLDINGS INC.

            
	 	 
	
              Per:

            	
               

            	
              /s/
                Nurez Khimji

            
	
              Name:

            	
               

            	
              Nurez
                Khimji

            
	
              Title:

            	
               

            	
              Chief
                Financial Officer

            
	 	 
	
              Per:

            	
               

            	
              /s/
                Keevin Vanloo

            
	
              Name:

            	
               

            	
              Keevin
                Vanloo

            
	
              Title:

            	
               

            	
              Corporate
                Controller.

            


    

     

    I/We
      have
      the authority to bind the Borrower 

     

    attachments:
      

     

    Terms
      and
      Conditions 

     

    Schedules:
      

     

    
      	
              •

            	
               

            	
              Definitions
                

            


    

     

    
      	
              •

            	
               

            	
              Calculation
                and Payment of Interest and Fees 

            


    

     

    
      	
              •

            	
               

            	
              Additional
                Borrowing Conditions 

            


    

     

    
      	
              •

            	
               

            	
              Borrowing
                Limit Certificate 

            


    

     

    -
      4 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    TERMS
      AND CONDITIONS 

     

    The
      Bank
      is requested by the Borrower to make the Credit Facilities available to the
      Borrower in the manner and at the rates and times specified in this Agreement.
      Terms defined elsewhere in this Agreement and not otherwise defined in the
      Terms
      and Conditions below or the Schedules attached hereto have the meaning given
      to
      such terms as so defined. In consideration of the Bank making the Credit
      Facilities available, the Borrower agrees, with the Bank as follows:


     

    REPAYMENT
      

     

    Amounts
      outstanding under the Credit Facilities, together with Interest, shall become
      due in the manner and at the rates and times specified in this Agreement and
      shall be paid in the currency of the Borrowing. Unless the Bank otherwise
      agrees, any payment hereunder must be made in money which is legal tender at
      the
      time of payment. In the case of a demand facility of any kind, the Borrower
      shall repay all principal sums outstanding under such facility upon demand
      including, without limitation, an amount equal to the face amount of all LCs
      and
      LGs which are unmatured or unexpired, which amount shall be held by the Bank
      as
      security for the Borrower’s obligations to the Bank in respect of such
      Borrowings. Where any Borrowings are repayable by scheduled blended payments,
      such payments shall be applied, firstly, to interest due, and the balance,
      if
      any, shall be applied to principal outstanding. If any such payment is
      insufficient to pay all interest then due, the unpaid balance of such Interest
      will be added to such Borrowing, will bear interest at the same rate, and will
      be payable on demand or on the date specified herein, as the case may be.
      Borrowings repayable by way of scheduled payments of principal and interest
      shall be so repaid with any balance of such Borrowings being due and payable
      as
      and when specified in this Agreement. The Borrower shall ensure that the
      maturities of instruments or contracts selected by the Borrower when making
      Borrowings will be such so as to enable the Borrower to meet its repayment
      obligations. 

     

    PREPAYMENT
      

     

    Where
      Borrowings are by way of RBP Loans or RBUSBR Loans, the Borrower may prepay
      such
      Borrowings in whole or in part without fee or premium. 

     

    EVIDENCE
      OF lNDEBTEDNESS 

     

    The
      Bank
      shall maintain accounts and records (the “Accounts”)
      evidencing the Borrowings made available to the Borrower by the Bank under
      this
      Agreement. The Bank shall record the principal amount of such Borrowings, the
      payment of principal and interest on account of the Borrowings, and all other
      amounts becoming due to the Bank under this Agreement. The Accounts constitute,
      in the absence of manifest error, conclusive evidence of the Indebtedness of
      the
      Borrower to the Bank pursuant to this Agreement. The Borrower authorizes and
      directs the Bank to automatically debit, by mechanical, electronic or manual
      means, any bank account of the Borrower for all amounts payable under this
      Agreement, including, but not limited to, the repayment of principal and the
      payment of interest, fees and all charges for the keeping of such bank accounts.
      

     

    GENERAL
      COVENANTS 

     

    Without
      affecting or limiting the right of the Bank to terminate or demand payment
      of,
      or cancel or restrict availability of any unutilized portion of, any demand
      or
      other discretionary facility, the Borrower covenants and agrees with the Bank
      that the Borrower: 

     

    
      	
              a)

            	
              will
                pay all sums of money when due under the terms of this Agreement;
                

            


    

     

    
      	
              b)

            	
              will
                immediately advise the Bank of any event which constitutes or which,
                with
                notice, lapse of time or both, would constitute a breach of any covenant
                or other term or condition of this Agreement or any Security, or
                in the
                case of any term facility, an Event of Default;


            


    

     

    
      	
              c)

            	
              will
                file all material tax returns which are or will be required to be
                filed by
                it, pay or make provision for payment of all material taxes (including
                interest and penalties) and Potential Prior-Ranking Claims, which
                are or
                will become due and payable and provide adequate reserves for the
                payment
                of any tax, the payment of which is being contested;
                

            


    

     

    
      	
              d)

            	
              will
                give the Bank 30 days prior notice in writing of any intended change
                in
                Its ownership structure and it will not make or facilitate any such
                changes without the prior written consent of the Bank, (including
                any
                material change in the company’s management);


            


    

     

    
      	
              e)

            	
              will
                comply with all Applicable Laws, Including, without limitation, all
                Environmental Laws; 

            


    

     

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              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    
      	
              f)

            	
              will
                immediately advise the Bank of any action requests or violation notices
                received concerning the Borrower and hold the Bank harmless from
                and
                against any losses, costs or expenses which the Bank may suffer or
                incur
                for any environment related liabilities existent now or in the future
                with
                respect to the Borrower; 

            


    

     

    
      	
              g)

            	
              will
                deliver to the Bank such financial and other information as the Bank
                may
                reasonably request from time to time, Including, but not limited
                to, the
                reports and other information set out under Reporting Requirements;
                

            


    

     

    
      	
              h)

            	
              will
                immediately advise the Bank of any unfavourable change in its financial
                position which may adversely affect its ability to pay or perform
                its
                obligations in accordance with the terms of this Agreement;
                

            


    

     

    
      	
              i)

            	
              will
                keep Its assets fully insured against such perils and in such manner
                as
                would be customarily insured by Persons carrying on a similar business
                or
                owning similar assets. If the Borrower owns any commercial buildings
                located in Metropolitan Vancouver, the Lower Fraser Valley, Metropolitan
                Victoria or Saanich Peninsula, British Columbia, then, in addition
                to the
                preceding, the Borrower shall insure and keep fully insured such
                commercial buildings against risk of earthquake;
                

            


    

     

    
      	
              j)

            	
              except
                for Permitted Encumbrances, will not, without the prior written consent
                of
                the Bank, grant, create, assume or suffer to exist any mortgage,
                charge,
                lien, pledge, security interest or other encumbrance affecting any
                of its
                properties, assets or other rights;


            


    

     

    
      	
              k)

            	
              will
                not, without the prior written consent of the Bank, sell, transfer,
                convey, lease or otherwise dispose of any of Its properties or assets
                other than in the ordinary course of business and on commercially
                reasonable terms; 

            


    

     

    
      	
              l)

            	
              will
                not, without the prior written consent of the Bank, guarantee or
                otherwise
                provide for, on a direct, Indirect or contingent basis, the payment
                of any
                monies or performance of any obligations by any other Person, except
                as
                may be provided for herein; 

            


    

     

    
      	
              m)

            	
              will
                not, without the prior written consent of the Bank, merge, amalgamate,
                or
                otherwise enter into any other form of business combination with
                any other
                Person; 

            


    

     

    
      	
              n)

            	
              will
                permit the Bank or its representatives, from time to time, to visit
                and
                inspect the Borrower’s premises, properties and assets and examine and
                obtain copies of the Borrower’s records or other information and discuss
                the Borrower’s affairs with the auditors, counsel and other professional
                advisers of the Borrower. 

            


    

     

    EXPENSES,
      ETC. 

     

    The
      Borrower agrees to pay the Bank all fees, as stipulated in this Agreement.
      The
      Borrower also agrees to pay all fees (including legal fees), costs and expenses
      incurred by the Bank in connection with preparation, negotiation and
      documentation of this Agreement and any Security and the operation, enforcement
      or termination of this Agreement and the Security. The Borrower shall indemnify
      and hold the Bank harmless against any loss, cost or expense incurred by the
      Bank if any facility under the Credit Facilities is repaid or prepaid other
      than
      on its Maturity Date. The determination by the Bank of such loss, cost or
      expense shall be conclusive and binding for all purposes and shall include,
      without limitation, any loss Incurred by the Bank in liquidating or redeploying
      deposits acquired to make or maintain any facility. 

     

    GENERAL
      INDEMNITY 

     

    The
      Borrower hereby agrees to indemnify and hold the Bank and its directors,
      officers, employees and agents harmless from and against any and all claims,
      suits, actions, demands, debts, damages, costs, losses, obligations, judgements,
      charges, expenses and liabilities of any nature which are suffered, incurred
      or
      sustained by, imposed on or asserted against any such Person as a result of,
      in
      connection with or arising out of i) any Event of Default or breach of any
      term
      or condition of this Agreement or any Security by the Borrower
      or any Guarantor if applicable (whether or not constituting an Event of
      Default), ii) the Bank acting upon instructions given or agreements made by
      electronic transmission of any type, iii) the presence of Contaminants at,
      on or
      under or the discharge or likely discharge of Contaminants from, any properties
      now or previously used by the Borrower or any Guarantor and iv) the breach
      of or
      non compliance with any Applicable Law by the Borrower or any Guarantor.


     

    AMENDMENTS
      AND WAIVERS 

     

    No
      amendment or waiver of any provision of this Agreement will be effective unless
      it is in writing, signed by the Borrower and the Bank. No failure or delay,
      on
      the part of the Bank, in exercising 

     

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      6 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    any
      right
      or power hereunder or under any Security shall operate as a waiver thereof.
      Any
      amendments requested by the Borrower will require review and agreement by the
      Bank and its counsel. Costs related to this review will be for the Borrower’s
      account. 

     

    SUCCESSORS
      AND ASSIGNS 

     

    This
      Agreement shall extend to and be binding upon the parties hereto and their
      respective heirs, executors, administrators, successors and permitted assigns.
      The Borrower shall not be entitled to assign or transfer any rights or
      obligations hereunder, without the consent in writing of the Bank. The Bank
      may
      assign or transfer all or any part of its rights end obligations under this
      Agreement to any Person. The Bank may disclose to potential or actual assignees
      or transferees confidential information regarding the Borrower and any Guarantor
      if applicable, (including, any such information provided by the Borrower, and
      any Guarantor if applicable, to the Bank) and shall not be liable for any such
      disclosure. 

     

    GAAP
      

     

    Unless
      otherwise provided, all accounting terms used in this Agreement shall be
      interpreted in accordance with Canadian Generally Accepted Accounting Principles
      in effect from time to time, applied on a consistent basis from period to
      period. Any change in accounting principles or the application of accounting
      principles, including, without limitation, the use of differential reporting
      (or
      any changes to the selection of differential reporting options) is only
      permitted with the prior written consent of the Bank. 

     

    SEVERABILITY
      

     

    The
      invalidity or unenforceability of any provision of this Agreement shall not
      affect the validity or enforceability of any other provision of this Agreement
      and such invalid provision shall be deemed to be severable. 

     

    GOVERNING
      LAW 

     

    This
      Agreement shall be construed in accordance with and governed by the laws of
      the
      Province identified in the Governing Law Jurisdiction section of this Agreement
      and the laws of Canada applicable therein. The Borrower irrevocably submits
      to
      the non-exclusive jurisdiction of the courts of such Province and acknowledges
      the competence of such courts and irrevocably agrees to be bound by a judgment
      of any such court. 

     

    DEFAULT
      BY LAPSE OF TIME 

     

    The
      mere
      lapse of time fixed for performing an obligation shall have the effect of
      putting the Borrower, or a Guarantor if applicable, in default thereof.


     

    SET-OFF
      

     

    The
      Bank
      is authorized (but not obligated), at any time and without notice, to apply
      any
      credit balance (whether or not then due) in any account in the name of the
      Borrower, or to which the Borrower is beneficially entitled (in any currency)
      at
      any branch or agency of the Bank in or towards satisfaction of the indebtedness
      of the Borrower due to the Bank under the Credit Facilities and the other
      obligations of the Borrower under this Agreement. For that purpose, the Bank
      is
      irrevocably authorized to use all or any part of any such credit balance to
      buy
      such other currencies as may be necessary to effect such application.


     

    NOTICES
      

     

    Any
      notice or demand to be given by the Bank shall be given in writing by way of
      a
      letter addressed to the Borrower. If the letter is sent by telecopier, it shall
      be deemed received on the date of transmission, provided
      such transmission is sent prior to 5:00 p.m. on a day on which the Borrower’s
      business is open for normal business, and otherwise on the next such day. If
      the
      letter is sent by ordinary mail to the address of the Borrower, it shall be
      deemed received on the date falling five (5) days following the date of the
      letter, unless the letter is hand-delivered to the Borrower, in which case
      the
      letter shall be deemed to be received on the date of delivery. The Borrower
      must
      advise the Bank at once about any changes in the Borrower’s address.


     

    -
      7 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    CONSENT
      OF DISCLOSURE 

     

    The
      Borrower hereby grants permission to any Person having information in such
      Person’s possession relating to any Potential Prior-Ranking Claim, to release
      such information to the Bank (upon its written request), solely for the purpose
      of assisting the Bank to evaluate the financial condition of the Borrower.
      

     

    NON-MERGER
      

     

    The
      provisions of this Agreement shall not merge with any Security provided to
      the
      Bank, but shall continue in full force for the benefit of the parties hereto.
      

     

    JOINT
      AND SEVERAL 

     

    Where
      more than one Person is liable as Borrower or Guarantor if applicable for any
      obligation under this Agreement, then the liability of each such Person for
      such
      obligation is joint and several (in Quebec, solidarily) with each other such
      Person. 

     

    LIFE
      INSURANCE 

     

    The
      Borrower acknowledges that it is ineligible for insurance coverage and that
      Borrowings are not insured as at the date of acceptance of this Agreement.
      

     

    COUNTERPART
      EXECUTION 

     

    This
      Agreement may be executed in any number of counterparts and by different parties
      in separate counterparts, each of which when so executed shall be deemed to
      be
      an original and all of which taken together constitute one and the same
      instrument. 

     

    EMAIL
      AND FAX TRANSMISSION 

     

    The
      Bank
      is entitled to rely on any report or certificate provided to the Bank by the
      Borrower or any Guarantor as applicable, by way of email or fax transmission
      as
      though it were an originally signed document. The Bank is further entitled
      to
      assume that any communication from the Borrower received by email or fax
      transmission is a reliable communication from the Borrower. 

     

    REPRESENTATIONS
      AND WARRANTIES 

     

    The
      Borrower, represents and warrants to the Bank that: 

     

    
      	
              a)

            	
              if
                it is a corporation, it is duly incorporated, validly existing and
                duly
                registered or qualified to carry on business in each jurisdiction
                in which
                its business or assets are located;


            


    

     

    
      	
              b)

            	
              the
                execution, delivery and performance by it of this Agreement have
                been duly
                authorized by all necessary actions and do not violate its constating
                documents or any Applicable Laws or agreements to which it is subject
                or
                by which it is bound; 

            


    

     

    
      	
              c)

            	
              no
                event has occurred which constitutes, or which, with notice, lapse
                of
                time, or both, would constitute, an Event of Default or a breach
                of any
                covenant or other term or condition of this Agreement or any Security;
                

            


    

     

    
      	
              d)

            	
              there
                is no claim, action, prosecution or other proceeding of any kind
                pending
                or threatened against it or any of its assets or properties before
                any
                court or administrative agency which relates to any non-compliance
                with
                any Environmental Laws which, if adversely determined, might have
                a
                material adverse effect upon its financial condition or operations
                or its
                ability to perform its obligations under this Agreement or any Security,
                and there are no circumstances of which it is aware which might give
                rise
                to any such proceeding which it has not fully disclosed to the Bank:
                and
                

            


    

     

    
      	
              e)

            	
              it
                has good and marketable title to all of its properties and assets,
                free
                and clear of any encumbrances, other than as may be provided for
                herein.
                

            


    

     

    Representations
      and warranties are deemed to be repeated as at the time of each Borrowing.
      

     

    LANGUAGE
      

     

    The
      parties hereto have expressly requested that this Agreement and all related
      documents, including notices, be drawn up in the English language. 

     

    -
      8 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              Verichip
                Holdings Inc.

            	
                

            	 	
                

            	
              March
                15, 2006

            


    

     

    WHOLE
      AGREEMENT 

     

    This
      Agreement and any documents or instruments referred to in, or delivered pursuant
      to, or in connection with, this Agreement constitute the whole and entire
      agreement between the Borrower and the Bank with respect to the Credit
      Facilities. 

     

    EXCHANGE
      RATE FLUCTUATIONS 

     

    If,
      for
      any reason, the amount of Borrowings outstanding under any facility, when
      converted to the Equivalent Amount in Canadian currency, exceeds the amount
      available under such facility, the Borrower shall immediately repay such excess
      or shall secure such excess to the satisfaction of the Bank. 

     

    -
      9 -


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	
              .

            	
                

            	 	
                

            	
              Schedule
                A

            


    

     

    Schedule
      “A”
      to the
      Agreement dated March 15, 2006, between Verichip Holdings Inc., as
      Borrower, and Royal Bank of Canada, as the Bank. 

     

    DEFINITIONS
      

     

    For
      the
      purpose of this Agreement, the following terms and phrases shall have the
      following meanings: 

     

    “Applicable
      Laws”
means,
      with respect to any Person, property, transaction or event, all present or
      future applicable laws, statutes, regulations, rules, orders, codes, treaties,
      conventions, judgements, awards, determinations and decrees of any governmental,
      regulatory, fiscal or monetary body or court of competent jurisdiction in any
      applicable jurisdiction; 

     

    “Borrowing”
means
      each use of a Credit Facility and all such usages outstanding at any time are
      “Borrowings”;
      

     

    “Business
      Day”
means
      a
      day, excluding Saturday, Sunday and any other day which shall be a legal holiday
      or a day on which banking institutions are closed throughout Canada:


     

    “Contaminant”
      includes, without limitation, any pollutant, dangerous substance, liquid waste,
      Industrial waste, hazardous material, hazardous substance or contaminant
      including any of the foregoing as defined in any Environmental Law;


     

    “EDC
      Accounts Receivable”
means
      trade accounts receivable of the Borrower, where the payment has been insured
      by
      Export Development Canada (“EDC”), and the Bank has been provided with a duly
      executed Direction to Pay on EDC Form E-6 supported by a copy of the applicable
      insurance policy and any renewals thereof; 

     

    “Environmental
      Activity”
means
      any activity, event or circumstance in respect of a Contaminant, including,
      without limitation, its storage, use, holding, collection, purchase,
      accumulation, assessment, generation, manufacture, construction, processing,
      treatment, stabilization, disposition, handling or transportation, or its
      Release into the natural environment, including movement through or in the
      air,
      soil, surface water or groundwater; 

     

    “Environmental
      Laws”
means
      all Applicable Laws relating to the environment or occupational health and
      safety, or any Environmental Activity; 

     

    “Equivalent
      Amount”
means,
      with respect to an amount of any currency, the amount of any other currency
      required to purchase that amount of the first mentioned currency through the
      Bank in Toronto, in accordance with normal banking procedures; 

     

    “Good
      Accounts Receivable”
means
      trade accounts receivable of the Borrower owing by Persons whose chief operating
      activities are located in Canada excluding EDC Accounts Receivable and excluding
      (i) the entire amount of accounts, any portion of which is outstanding more
      than 60 days after billing date, provided that the under 60 day portion may
      be
      included where the over 60 day portion is less than 10% of the amount of
      accounts, or where the Bank has designated such portion as nevertheless good,
      (ii) all amounts due from any affiliate, (iii) bad or doubtful
      accounts, (iv) accounts subject to any security interest or other
      encumbrance ranking or capable of ranking in priority to the Bank’s security,
      (v) the amount of all holdbacks, contra accounts or rights of set-off on
      the part of any account debtor, (vi) accounts receivable relating to
      account debtors not domiciled in jurisdictions approved by the Bank (except
      where supported by Letters of Credit or Export Insurance) or (vii) any
      accounts which the Bank has previously advised to be ineligible; 

     

    “Good
      EDC Accounts Receivable”
means
      EDC Accounts Receivable, excluding (i) the entire amount of accounts, any
      portion of which is outstanding more than 90 days after billing date, provided
      that the under 90 day portion may be included where the over 90 day portion
      is
      less than 10% of the amount of accounts or where the Bank has designated such
      portion as nevertheless good, (ii) all amounts due from any affiliate,
      (iii) bad or doubtful accounts, (iv) 

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	 	
                

            	 	
                

            	
              Schedule
                A

            


    

     

    accounts
      subject to any security interest or other encumbrance ranking or capable of
      ranking in priority to the Bank’s security, (v) the amount of all
      holdbacks, contra accounts or rights of set-off on the part of any account
      debtor, or (vi) any accounts which the Bank has previously advised to be
      ineligible; 

     

    “Guarantor”
means
      any Person who has guaranteed the obligations of the Borrower under this
      Agreement; 

     

    “Letter
      of Credit”
or
      “LC”
means
      a
      documentary credit issued by the Bank on behalf of the Borrower for the purpose
      of paying suppliers of goods; 

     

    “Letter
      of Guarantee”
or
      “LG”
means
      a
      documentary credit issued by the Bank on behalf of the Borrower for the purpose
      of providing security to a third party that the Borrower or a person designated
      by the Borrower will perform a contractual obligation owed to such third party.
      

     

    “Maturity
      Date”
means
      the date on which a facility is due and payable in full; 

     

    “Permitted
      Encumbrances”
means,
      in respect of the Borrower: 

     

    
      	
              a)

            	
              liens
                arising by operation of law for amounts not yet due or delinquent,
                minor
                encumbrances on real property such as easements and rights of way
                which do
                not materially detract from the value of such property, and security
                given
                to municipalities and similar public authorities when required by
                such
                authorities in connection with the operations of the Borrower in
                the
                ordinary course of business; 

            


    

     

    
      	
              b)

            	
              Security
                granted in favour of the Bank; 

            


    

     

    “Person”
      includes an individual, a partnership, a joint venture, a trust, an
      unincorporated organization, a company, a corporation, an association, a
      government or any department or agency thereof including Canada Revenue Agency,
      and any other incorporated or unincorporated entity; 

     

    “Potential
      Prior-Ranking Claims”
means
      all amounts owing or required to be paid, where the failure to pay any such
      amount could give rise to a claim pursuant to any law, statute, regulation
      or
      otherwise, which ranks or is capable of ranking in priority to the Security
      or
      otherwise in priority to any claim by the Bank for repayment of any amounts
      owing under this Agreement; 

     

    “RBP”
and
      “Royal
      Bank Prime”
each
      means the annual rate of interest announced by the Bank from time to time as
      being a reference rate then in effect for determining interest rates on
      commercial loans made in Canadian currency in Canada; 

     

    “Release”
      includes discharge, spray, inject, inoculate, abandon, deposit, spill, leak,
      seep;
      pour,
      emit, empty, throw, dump, place and exhaust, and when used as a noun has a
      similar meaning; 

     

    “RBUSBR”
and
      “Royal
      Bank US Base Rate”
each
      means the annual rate of interest announced by the Bank from time to time as
      a
      reference rate then in effect for determining interest rates on commercial
      loans
      made in US currency in Canada; 

     

    “Unencumbered
      Inventory”
means
      inventory on-site of the Borrower which is not subject to any security interest
      or other encumbrance or any other right or claim which ranks or is capable
      of
      ranking in priority to the Bank’s security including, Without limitation, rights
      of unpaid suppliers under the Bankruptcy
      and Insolvency Act, Canada,
      to repossess inventory within 30 days after delivery; 

     

    “US”
means
      United States of America. 

     

    2
      

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	 	 	 	 	 
	 	
                

            	 	
                

            	
              Schedule
                B

            


    

     

    Schedule
      “B”
      to the
      Agreement dated March 15, 2006, between Verichip Holdings Inc., as
      Borrower, and Royal Bank of Canada, as the Bank. 

     

    CALCULATION
      AND PAYMENT OF INTEREST AND FEES 

     

    LIMIT
      ON INTEREST 

     

    The
      Borrower shall not be obligated to pay any interest, fees or costs under or in
      connection with this Agreement in excess of what is permitted by Applicable
      Law.


     

    OVERDUE
      PAYMENTS 

     

    Any
      amount that is not paid when due hereunder shall, unless interest is otherwise
      payable in respect thereof in accordance with the terms of this Agreement or
      the
      instrument or contract governing same, bear interest until paid at the rate
      of
      RBP plus 5% per annum or, in the case of an amount in US currency if
      applicable, RBUSBR plus 5% per annum. Such interest on overdue amounts
      shall be computed daily, compounded monthly and shall be payable both before
      and
      after any or all of default, maturity date, demand and judgement. 

     

    EQUIVALENT
      YEARLY RATES 

     

    The
      annual rates of interest or fees to which the rates calculated in accordance
      with this Agreement are equivalent, are the rates so calculated multiplied
      by
      the actual number of days in the calendar year in which such calculation is
      made
      and divided by 365. 

     

    TIME
      AND PLACE OF PAYMENT 

     

    Amounts
      payable by the Borrower hereunder shall be paid at such place as the Bank may
      advise from time to time in the applicable currency. Amounts due on a day other
      than a Business Day shall be deemed to be due on the Business Day next following
      such day. Interest and fees payable under this Agreement are payable both before
      and after any or all of default, maturity date, demand and judgement.


     

    RBP
      LOANS AND RBUSBR LOANS 

     

    The
      Borrower shall pay interest on each RBP Loan and RBUSBR Loan, monthly in
      arrears, on the 20th day of each month or such other day as may be agreed to
      between the Borrower and the Bank. Such interest will be calculated monthly
      and
      will accrue daily on the basis of the actual number of days elapsed and a year
      of 365 days and shall be paid in the currency of the applicable Borrowing.
      

     

    LETTER
      OF CREDIT FEES 

     

    The
      Borrower shall pay a LC fee on the date of issuance of any LC calculated on
      the
      face amount of the LC issued, based upon the number of days in the term and
      a
      year of 365 days. If applicable, fees for LCs issued in US currency shall be
      paid in US currency and fees for LCs issued in any other approved currency
      shall
      be paid in Canadian currency. 

     

    LETTER
      OF GUARANTEE FEES 

     

    The
      Borrower shall pay a LG fee on the date of issuance of any LG calculated on
      the
      face amount of the LG issued and based on the number of days in the term thereof
      and a year of 365 days. If applicable, fees for LGs issued in US currency shall
      be paid in US currency and fees for LGs issued in any other approved currency
      shall be paid in Canadian currency. 

    
 

    
      
         

      

      
         

        
          

        

      

       

      
         

      

    

    
      	 	 	 	 	 
	 	
                

            	 	
                

            	
              Schedule
                C

            


    

     

    Schedule
      “C”
      to the
      Agreement dated March 15, 2006, between Verichip Holdings Inc., as
      Borrower, and Royal Bank of Canada, as the Bank. 

     

    ADDITIONAL
      BORROWING CONDITIONS 

     

    LCs
      or LGs: 

     

    Borrowings
      made by way of LCs or LGs will be subject to the following terms and conditions:
      

     

    
      	
              a)

            	
              each
                LC and LG shall expire on a Business Day and shall have a term of
                not more
                than 365 days; 

            


    

     

    
      	
              b)

            	
              at
                least 2 Business Days prior to the issue of an LC or LG, the Borrower
                shall execute a duly authorized application with respect to such
                LC or LG
                and each LC and LG shall be governed by the terms and conditions
                of the
                relevant application for such contract;


            


    

     

    
      	
              c)

            	
              an
                LC or LG may not be revoked prior to its expiry date unless the consent
                of
                the beneficiary of the LC or LG has been obtained;
                

            


    

     

    
      	
              d)

            	
              any
                LC or LG issued under a term facility must have an expiry date on
                or
                before the Maturity Date of the term facility, unless otherwise agreed
                by
                the Bank; and 

            


    

     

    
      	
              e)

            	
              if
                there is any inconsistency at any time between the terms of this
                Agreement
                and the terms of the application for LC or LG, the terms of the
                application for LC or LG shall govern.


            


    

     

    FEF
      Contracts 

     

    “Foreign
      Exchange Forward Contract”
or
      “FEF
      Contract”
means
      a
      currency exchange transaction or agreement or any option with respect to any
      such transaction now existing or hereafter entered into between the Borrower
      and
      the Bank; 

     

    At
      the
      Borrower’s request, the Bank may agree to enter into FEF Contracts with the
      Borrower from time to time. The Borrower acknowledges that the Bank makes no
      formal commitment herein to enter into any FEF Contract and the Bank may, at
      any
      time and at all times, in its sole and absolute discretion, accept or reject
      any
      request by the Borrower to enter into a FEF Contract. If the Bank does enter
      into a FEF Contract with the Borrower, it will do so subject to the following:
      

     

    
      	
              a)

            	
              the
                Borrower shall promptly issue or countersign and return a confirmation
                or
                acknowledgement of the terms of each such FEF Contract as required
                by the
                Bank; 

            


    

     

    
      	
              b)

            	
              the
                Borrower shall, if required by the Bank, promptly enter into a Foreign
                Exchange and Options Master Agreement or such other agreement in
                form and
                substance satisfactory to the Bank to govern the FEF Contract(s);
                

            


    

     

    
      	
              c)

            	
              in
                the event of demand for payment under the Agreement of which this
                schedule
                forms a part, the Bank may terminate all or any FEF Contracts. If
                the
                agreement governing any FEF Contract does not contain provisions
                governing
                termination, any such termination shall be effected in accordance
                with
                customary market practice. The Bank’s determination of amounts owing under
                any terminated FEF Contract shall be conclusive in the absence of
                manifest
                error. The Bank shall apply any amount owing by the Bank to the Borrower
                on termination of any FEF Contract against the Borrower’s obligations to
                the Bank under the Agreement and any amount owing to the Bank by
                the
                Borrower on such termination shall be added to the Borrower’s obligations
                to the Bank under the Agreement and secured by the Security;
                

            


    

     

    
      	
              d)

            	
              the
                Borrower shall pay all required fees in connection with any FEF Contracts
                and indemnify and hold the Bank harmless against any loss, cost or
                expense
                incurred by the Bank in relation to any FEF Contract;
                

            


    

     

    
      	
              e)

            	
              any
                rights of the Bank herein in respect of any FEF Contract are in addition
                to and not in limitation of or substitution for any rights of the
                Bank
                under any agreement governing such FEF Contract. In the event that
                there
                is any inconsistency at any time between the terms hereof and any
                agreement governing such FEF Contract, the terms of such agreement
                shall
                prevail; and 

            


    

     

    
      	
              f)

            	
              in
                addition to any security which may be held at any time in respect
                of any
                FEF Contract, upon request by the Bank from time to time, the Borrower
                will deliver to the Bank such security as is acceptable to the Bank
                as
                continuing collateral security for the Borrower’s obligations to the Bank
                in respect of FEF Contracts. 

            


    

     

    

      
        

      

    

     

    


    
      	 	 	 	 	 
	 	
                

            	 	
                

            	
              Schedule
                D

            


    

     

    Schedule
      “D”
      to the
      Agreement dated March 15, 2006, between Verichip Holdings Inc., as
      Borrower, and Royal Bank of Canada, as the Bank. 

     

    BORROWING
      LIMIT CERTIFICATE 

     

    I,
                                              ,
      representing the Borrower hereby certify as of                                         
      (insert
      last day of month/quarter as applicable): 

     

    
      	
              1.

            	
              I
                am familiar with and have examined the provisions of the Agreement
                dated
                March 6, 2006 and any amendments thereto, between Verichip Holdings
                Inc., as Borrower, and Royal Bank of Canada, as the Bank and have
                made
                reasonable investigations of corporate records and inquiries of other
                officers and senior personnel of the Borrower. Terms defined in the
                Agreement have the same meanings where used in this certificate.
                

            


    

     

    
      	
              2.

            	
              The
                Borrowing Limit is $                    ,
                calculated as follows: 

            


    

     

    
      	 	 	 	 	 	 	 	 	 	 	 
	
              Total
                accounts receivable owing by persons located in Canada Excluding
                EDC
                Accounts Receivable

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            
	
              Less:

            	
               a) 

            	
              Accounts,
                any portion of which exceeds 60 days

            	
                

            	
               

            	
              
                
                  $            

                

              

            	
                

            	 	
                

            	 	 
	 	
               b)

            	
              Accounts
                due from affiliates

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               c) 

            	
              “Under
                60 days” accounts where collection Is suspect

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               d) 

            	
              Accounts
                subject to prior encumbrances

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               e) 

            	
              Holdbacks,
                contra-accounts or rights of set-off

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               f) 

            	
              Other
                ineligible accounts

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	
              Plus:

            	
               g) 

            	
              Under
                60 day portion of accounts included in (a) above, where the over
                60 day
                portion is less than 10% of the amount of accounts, or which the
                Bank has
                designated as nevertheless good

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	
              Good
                Accounts Receivable

            	
                

            	 	 	
                

            	
              A

            	
                

            	
              $

            	
                          

            
	
              Marginable
                Good Accounts Receivable at 75% of A

            	
                

            	 	 	
                

            	
              B

            	
                

            	
              $

            	
                          

            
	
              Total
                EDC Accounts Receivable

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            
	
              Less:

            	
               a)

            	
              Accounts,
                any portion of which exceeds 90 days

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               b)

            	
              Accounts
                due from affiliates

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               c)

            	
              Accounts
                where collection is suspect

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               d)

            	
              Accounts
                subject to prior encumbrances

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               e)

            	
              Holdbacks,
                contra-accounts or rights of set-off

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               f)

            	
              Other
                ineligible accounts

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	
              Good
                EDC Accounts Receivable

            	
                

            	 	 	
                

            	
              C

            	
                

            	
              $

            	
                          

            
	
              Marginable
                Good EDC Accounts Receivable at 85% of C

            	
                

            	 	 	
                

            	
              D

            	
                

            	
              $

            	
                          

            
	
              Total
                inventory (valued at lesser of cost or net realizable
                value)

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            
	
              Less:

            	
               a)

            	
              Inventory
                subject to prior encumbrances

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               b)

            	
              inventory
                subject to 30 day supplier payables

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	 	
               c)

            	
              Other
                non qualifying inventory

            	
                

            	
               

            	
              $            

            	
                

            	 	
                

            	 	 
	
              Unencumbered
                Inventory

            	
                

            	 	 	
                

            	
              E

            	
                

            	
              $

            	
                          

            
	
              Marginable
                Unencumbered Inventory at 25% of G (Max $375,000)

            	
                

            	 	 	
                

            	
              F

            	
                

            	
              $

            	
                          

            
	
              Less:  Potential
                Prior-Ranking Claims

            	
                

            	 	 	
                

            	
              G

            	
                

            	
              $

            	
                          

            
	
              Borrowing
                Limit (B+D+F-G)

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            
	
              Less:  Facility
                # 1 Borrowings

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            
	
              Margin
                Surplus (Deficit)

            	
                

            	 	 	
                

            	 	
                

            	
              $

            	
                          

            


    

    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	
              3.

            	
              Annexed
                hereto are the following reports in respect of the Borrower:
                

            


    

     

    
      	
               

            	
              a)

            	
              aged
                list of accounts receivable, 

            


    

     

    
      	
               

            	
              b)

            	
              aged
                list of EDC insured accounts receivable supported by Direction to
                Pay on
                EDC form E-6, 

            


    

     

    
      	
               

            	
              c)

            	
              status
                of inventory, 

            


    

     

    
      	
               

            	
              d)

            	
              listing
                of Potential Prior-Ranking Claims, and


            


    

     

    
      	
               

            	
              e)

            	
              listing
                of supplier payables having 30 day repossession rights over inventory.
                

            


    

     

    
      	
              4.

            	
              The
                reports and information provided herewith are accurate and complete
                in all
                respects and all amounts certified as Potential Prior-Ranking Claims
                are
                current amounts owing and not in arrears.


            


    

     

    Dated
      this             
      day of
                    ,
      20        .
      

     

    
      	 	 	 
	 	 
	
              Per:

            	
               

            	
                

            
	 	 
	
              Name:

            	
               

            	
                

            
	 	 
	
              Title: