Document:

EXHIBIT 10.3

 

AMENDED AND RESTATED DEMAND SECURED
PROMISSORY NOTE

 

This Amended and Restated
Demand Secured Promissory Note amends and restates that certain Demand Secured Promissory Note dated March 27, 2014, (as at any
time amended, the "Promissory Note").

 

	$5,500,000.00	SEPTEMBER  25, 2014

Alpharetta, Georgia

 

FOR VALUE RECEIVED,
the undersigned ("Borrower") promises to pay, on demand, to the order of Presidential Financial Corporation (the
"Lender''), at the Lender's main office in Alpharetta, Georgia, or at such other place as Lender may designate, the
principal sum of FIVE MILLION FIVE HUNDRED THOUSAND AND N0/100 DOLLARS ($5,500,000.00) or so much thereof as may from time to time
be outstanding under that certain Loan and Security Agreement dated as of the date hereof between Borrower and Lender (as at any
time amended, restated, modified or supplemented, the "Loan Agreement"), together with interest thereon as hereinafter
set forth. Capitalized terms used herein, unless otherwise defined herein, shall have the meanings ascribed to them in the Loan
Agreement.

 

Interest shall accrue
on the unpaid principal balance of this Amended and Restated Demand Secured Promissory Note (this "Note") at a
variable rate per annum equal to five percent (5%) (the "Percentage Rate") above the greater of (a) the prime
rate of interest quoted in The Wall Street Journal from time to time (the "Wall Street Journal Prime")
or (b) three point two-five percent (3.25%) (the "Prime Rate Floor''). If the Wall Street Journal Prime becomes unavailable
during the term of this Note, Lender may designate a substitute index. The rate of interest under this Note on the date hereof,
expressed in simple interest terms, is eight point two-five percent (8.25%) per annum. Notwithstanding the interest payable, Borrower
will pay to the Lender interest based on a minimum assumed outstanding principal balance of Five Hundred Thousand and No/100 Dollars
($500,000.00) (whichever rate is applicable from time to time shall be referred to herein as the "Interest Rate"). The
interest rate hereunder shall adjust on the published effective date of any change in Wall Street Journal Prime (or any substitute
index) to the extent that the Wall Street Journal Prime (or any substitute index) is greater than the Prime Rate Floor on such
date. Interest on this Note shall accrue daily and shall be due and payable monthly, in arrears, on the last day of each month.
Borrower shall be deemed to have requested an Advance under the Loan Agreement on each date that any interest is due under this
Note and Lender may make such Advance for the account of Borrower, charging Borrower for its share of interest accrued on Advances
made to or for the account of Borrower, all as provided in the Loan Agreement. Upon and after the occurrence of any Event of Default
and during the continuance thereof, interest shall accrue and be payable at a fixed rate of four percent (4.0%) per month (the
"Default Interest Rate"). Interest shall be calculated on the basis of actual days elapsed in a year of 360 days.
All payments received in respect of this Note may be applied by Lender first to accrued interest and other charges due and owing
to Lender and any remaining amount may be applied to the principal balance hereof.

 

    	 

    	 

    

  

In the event that
Borrower maintains a minimum Fixed Charge Coverage Ratio of 1.25:1 based on the September 30, 2014 audited financial statements
(as defined in the Loan Agreement) and no Event of Default has occurred, Borrower may request a reduction in the Percentage Rate
to four percent (4%) ("the Adjusted Percentage Rate") to take effect on the first day of the following month, provided
no Event of Default has occurred or exists. If Borrower does not maintain a minimum Fixed Charge Coverage Ratio of 1.25:1, the
effective Adjusted Percentage Rate will return to five percent (5%).

 

This Note is the Demand
Secured Promissory Note referred to in the Loan Agreement, evidences the unpaid balance of Advances from time to time under the
Loan Agreement, is secured by the Collateral, and is entitled to the benefits of the Loan Agreement. Lender, from time to time
may make Advances as may be requested by Borrower and accept payments in accordance with and subject to the provisions of this
Note and the Loan Agreement, and therefore the amount outstanding under this Note may vary from time to time by increases.

 

It is the intention
of Lender and Borrower to conform strictly to Applicable Law relating to maximum interest charges. Accordingly, if the transactions
contemplated hereby would violate any Applicable Law governing the Highest Lawful Rate (as defined below), then, in that event,
notwithstanding anything to the contrary in this Note, the following will apply: the aggregate of all payments that constitute
interest under Applicable Law that is contracted for, taken, reserved, charged, or received by Lender under this Note shall under
no circumstances be in an amount or at a rate that would otherwise cause a violation of such law or exceed the Highest Lawful Rate
(as defined below), and any excess shall be canceled automatically and, if theretofore paid, shall, at the option of Lender, be
credited by Lender on the principal amount of any Obligations or refunded by Lender to Borrower. The term "Highest Lawful
Rate" means the maximum interest rate that at any time or from time to time may be lawfully contracted for, taken, reserved,
charged, or received on amounts due to Lender, under laws applicable to Borrower or Lender with regard to this Note that are presently
in effect or, to the extent allowed by law, under such Applicable Law that then allows a higher maximum lawful rate than Applicable
Law now allows.

 

The occurrence of
an Event of Default shall entitle Lender, at any time and without notice to or demand upon Borrower, to declare the entire unpaid
principal balance hereof and all accrued interest hereon to be, and the same shall thereupon become, immediately due and payable;
provided, however, that neither the foregoing provision nor any other provision in any Loan Document shall be construed
to limit, prejudice or otherwise affect the demand nature of this Note. Lender shall have the absolute and unconditional right
to demand payment of this Note in Lender's discretion at any time, whether or not any Event of Default exists. Time is of the essence
of this Note.

 

Borrower hereby waives
demand, presentment, notice, protest and notice of dishonor and diligence in collection or bringing suit and agrees that Lender
may accept partial payment, or release or exchange security or Collateral, without discharging or releasing any unreleased Collateral
or the Obligations evidenced hereby. Borrower further waives any and all rights of exemption, both as to personal and real property,
under the constitution or laws of the United States, the State of Georgia, or any other state or jurisdiction. Lender shall not
be deemed to waive or have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by an authorized
agent of Lender, and no failure, delay or omission by Lender in exercising any of its rights or remedies shall operate as a waiver
of such rights or remedies. A waiver by Lender in writing on one occasion shall not be construed as a consent to or a waiver of
any right or remedy on any future occasion.

 

    	2

    	 

    

  

Borrower agrees to pay
reasonable attorneys' fees and costs incurred by Lender in collecting or attempting to collect this Note, whether by suit or otherwise.
Attorney's fees relating to collection for which Borrower shall be responsible to reimburse Lender shall be equal to the greater
of (a) actual fees and expenses or (b) fifteen percent (15%) of the principal and interest owed hereunder at the time of commencement
of collection activities or the maximum amount permitted by law then in effect.

 

This Note has been
executed and delivered in the State of Georgia, is intended to take effect as a contract under seal under the laws of the State
of Georgia, and shall be governed in all respects by and construed in accordance with the internal laws of the State of Georgia.
This Note shall be binding upon Borrower and its successors and assigns.

 

BORROWER HEREBY WAIVES
TRIAL BY JURY IN ANY ACTION OR PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS NOTE, THE OBLIGATIONS, THE COLLATERAL,
ANY ALLEGED TORTIOUS CONDUCT BY LENDER WHICH MAY IN ANY WAY, DIRECTLY OR INDIRECTLY, ARISE OUT OF OR RELATE TO THE RELATIONSHIP
BETWEEN BORROWER AND LENDER.

 

IN WITNESS WHEREOF,
Borrower has caused this Note to be executed by its duly authorized officers and has delivered this Note to Lender, on the day
and year first above written.

 

	JANEL WORLD TRADE, LTD.	 	THE JANEL GROUP OF LOS ANGELES, INC.
	 	 	 	 	 
	By:	/s/ Philip J. Dubato	 	By:	/s/ Philip J. Dubato
	 	Philip J. Dubato, CFO	 	 	Philip J. Dubato, CFO
	 	 	 	 	 
	THE JANEL GROUP OF NEW YORK, INC.	 	JANEL FERRARA LOGISTICS, LLC
	 	 	 	 	 
	By:	/s/ Philip J. Dubato	 	By:	/s/ Philip J. Dubato
	 	Philip J. Dubato, CFO	 	 	Philip J. Dubato, CFO
	 	 	 	 	 
	THE JANEL GROUP OF ILLINOIS, INC.	 	ALPHA INTERNATIONAL, LP
	 	 	 	By: 	Janel Alpha GP LLC, G.P.
	 	 	 	By: 	Janel World Trade Ltd.
	By:	/s/ Philip J. Dubato	 	 	 
	 	Philip J. Dubato, CFO	 	By:	/s/ Philip J. Dubato
	 	 	 	 	Philip J. Dubato, CFO
	 	 	 	 	 
	THE JANEL GROUP OF GEORGIA, INC.	 	PCL TRANSPORT, LLC
	 	 	 	By: 	Janel World Trade Ltd., Managing Member
	By:	/s/ Philip J. Dubato	 	 	 
	 	Philip J. Dubato, CFO	 	By:	/s/ Philip J. Dubato
	 	 	 	 	Philip J. Dubato, CFO

 

    	3can_ex101.htm

Exhibit 10.1

 

AMENDMENT NO 1

TO

SECURITIES PURCHASE AGREEMENT

This Amendment No. 1 (the “Amendment”) to the Securities Purchase Agreement (the “SPA”) dated as of January 21, 2014 is entered into to be effective as of September __, 2014, by and among Advanced Cannabis Solutions, Inc., a Colorado corporation (the “Company”), and Full Circle Capital Corporation, a Maryland corporation (the “Holder”). All references to the SPA shall refer to the SPA as amended in this Amendment, including the Exhibits hereto. Capitalized terms used herein and not defined shall have the meanings set forth in the SPA.

WHEREAS, subject to certain conditions set forth in the SPA, the Company may issue to the Holder a Note for the principal amount of $7,500,000;

WHEREAS, upon mutual agreement of the Company and the Holder, the Company may subsequently issue to the Holder additional Notes for an aggregate principal amount of up to $22,500,000;

WHEREAS, pursuant to the SPA, the Company sold the Holder a warrant to purchase up to 1,400,000 shares of Common Stock (the “Warrant”); and

WHEREAS, the Holder and the Company desire to amend the terms of the SPA to better reflect current market conditions for the Company’s Common Stock and the business and industry as a whole.

NOW THEREFORE, in consideration of the above, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

	
1.1  

	
The definition of “Conversion Price” in Section 3(b)(ii) of Exhibit A to the SPA (the “Form of Notes”) shall be amended and restated as follows:

“Conversion Price” means, as of the Conversion Date or other date of determination, $4.00 per share.

 

	
1.2  

	
      The Warrant shall be amended as set forth in Exhibit A to this Amendment.

 

1.3 All other terms and provisions of the SPA and the Form of Notes in direct conflict with the amendment specifically set forth herein are hereby amended to conform to this Amendment; and except for this Amendment, all other terms and conditions of the SPA and the Form of Notes shall remain unamended hereby and in full force and effect.

 

1.4 This Amendment, together with the SPA and its exhibits, embodies the entire agreement and understanding between the Company and the Holder relating to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter.

 

1.5 If any provision of this Amendment, or the application of such provisions to any Person or circumstance, shall be held invalid, the remainder of this Amendment, or the application of such provision to Persons or circumstances other than those to which it is held invalid, shall not be affected thereby.

 

1.6 This Amendment may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed an original, but all of which taken together shall constitute one and the same agreement.  A facsimile transmission of this signed Amendment shall be legal and binding on all parties hereto.

 

[Signature Page Follows]

  

1

  

 

IN WITNESS WHEREOF, the parties hereto have duly caused this Amendment to be executed and delivered on the date first written above.

	 
COMPANY:

	 	 
HOLDER:

	 
	 
ADVANCED CANNABIS SOLUTIONS, INC.

	 	 
FULL CIRCLE CAPITAL CORPORATION

	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By: 	
/s/Robert L. Frichtel

	 	By:	
/s/ Gregg J. Felton

	 
	Title:	
 
CFO

	 	Title:	
 
President and Co-Chief Executive Officer

	 
	 	
 

	 	 	
 

	 

 

 

 

 

  

2

  

Exhibit A

AMENDMENT NO. 1

TO

WARRANT TO PURCHASE COMMON STOCK

This Amendment No. 1 (the “Warrant Amendment”) to the Warrant to Purchase Common Stock (the “Warrant”) dated as of January 21, 2014 is entered into to be effective as of September __, 2014, by and among Advanced Cannabis Solutions, Inc., a Colorado corporation (the “Company”), and the holder of the Warrant, Full Circle Capital Corporation, a Maryland corporation (the “Holder”).  Capitalized terms used herein and not defined shall have the meanings set forth in the Securities Purchase Agreement entered into by the Company and the Holder and dated as of January 21, 2014 (the “SPA”).

WHEREAS, pursuant to the SPA, the Company sold to the Holder a Warrant to purchase up to 1,000,000 shares of Common Stock;

WHEREAS, subject to certain conditions in the SPA, the Company may issue to the Holder a promissory note or series of promissory notes in the principal amount of up to $7,500,000 and subsequent additional promissory notes in the amount of up to $22,500,000 (each a “Note”); and

WHEREAS, the Holder and the Company desire to amend the terms of the Warrant to better reflect current market conditions for the Company’s Common Stock and the business and industry as a whole.

NOW THEREFORE, in consideration of the above, and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

	
  

	
1.1

	
The definition of “Exercise Price” in Section 1(b) of the Warrant shall be amended and restated as follows:

Exercise Price.  For the purposes of this Warrant, “Exercise Price” means:

 

(i) $4.00 per share.

 

	
  

	
1.2

	The amount of shares issuable upon the exercise of the Warrant shall be increased to 1,400,000 shares.

 

	
  

	
1.3

	
All other terms and provisions of the Warrant in direct conflict with the amendment specifically set forth herein are hereby amended to conform to this Warrant Amendment; and except for this Warrant Amendment, all other terms and conditions of the Warrant shall remain unamended hereby and in full force and effect.

 

	
  

	
1.4

	
This Warrant Amendment, together with the Warrant, embodies the entire agreement and understanding between the Company and the Holder relating to the subject matter hereof and supersedes all prior agreements and understandings relating to such subject matter.

 

	
  

	
1.5

	
If any provision of this Warrant Amendment, or the application of such provisions to any Person or circumstance, shall be held invalid, the remainder of this Warrant Amendment, or the application of such provision to Persons or circumstances other than those to which it is held invalid, shall not be affected thereby.

 

	
  

	
1.6

	
This Warrant Amendment may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed an original, but all of which taken together shall constitute one and the same agreement.  A facsimile transmission of this signed Warrant Amendment shall be legal and binding on all parties hereto.

 

[Signature Page Follows]

 

  

3

  

 

IN WITNESS WHEREOF, the parties hereto have duly caused this Warrant Amendment to be executed and delivered on the date first written above.

 

	 
COMPANY:

	 	 
HOLDER:

	 
	 
ADVANCED CANNABIS SOLUTIONS, INC.

	 	 
FULL CIRCLE CAPITAL CORPORATION

	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	By: 	
/s/Robert L. Frichtel

	 	By:	
/s/ Gregg J. Felton

	 
	Title:	
 
CFO

	 	Title:	
 
President and Co-Chief Executive Officer

	 
	 	
 

	 	 	
 

	 

4

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