ROCHESTER, N.Y., May 25, 2012 /PRNewswire/ -- Vuzix Corporation (TSX-V:VZX, OTC:BB: VUZI, FMB: V7X) ("Vuzix" or, the "Company"), a leader in the design and manufacture of Video Eyewear products that provide users with portable high quality viewing experiences, today entered into a Promissory Note and Security Agreement (the "Loan Agreement") with LC Capital Master Fund Ltd. (the "Lender") pursuant to which the Lender extended a line of credit of up to $500,000 (the "Loan"). The Loan may be drawn in multiple advances of no less than $100,000 up until June 15, 2012. All loan advances are at the sole discretion of the Lender. The Loan bears interest at a rate of 10% per annum for the first three months and the interest rate rises to 15% per annum on and after the three month anniversary until November 15, 2012, when the principal amount of the outstanding loan, together with accrued and unpaid interest, is payable in full.
The Loan Agreement contains certain customary covenants events of default and cross default provisions (including in respect of outstanding indebtedness in favor of the Lender).
Vuzix has granted the Lender a security interest in substantially all of the assets of Vuzix as security for the Loan. The Lender has agreed to subordinate its security interest in accounts receivable and inventory to a security interest granted by Vuzix to the bank that provides Vuzix with a line of credit, securing borrowings under that line of not more than $2,000,000.
Forward-Looking Statements Disclaimer
Certain statements contained in this release are "forward-looking statements" within the meaning of the Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. Forward-looking statements contained in this release relate to, among other things, refinancing opportunities, the Company's ability to draw on the Loan, the Company's financial position and the Company's leadership in the Video Eyewear industry. They are generally identified by words such as "plans," "seeks," "believes," "may," "expects," "anticipates," "should'" and similar expressions. Readers should not place undue reliance on such forward-looking statements, which are based upon the Company's beliefs and assumptions as of the date of this release. The Company's actual results could differ materially from those projected in the Company's forward-looking statements due to, among other things, our ability to raise necessary capital. These risk factors and others are described in more detail in the "Risk Factors" section of the Company's Annual Reports and MD&A filed with the United States Securities and Exchange Commission and applicable Canadian securities regulators (copies of which may be obtained at www.sedar.com or www.sec.gov). Subsequent events and developments may cause these forward-looking statements to change. The Company specifically disclaims any obligation or intention to update or revise these forward-looking statements as a result of changed events or circumstances that occur after the date of this release, except as required by applicable law.
About Vuzix Corporation
Vuzix is a leading supplier of Video Eyewear products in the defense, consumer and media & entertainment markets. The Company's products, personal display devices that offer users a portable high quality viewing experience, provide solutions for mobility, thermal sighting systems, tactical wearable displays and virtual and augmented reality. With its origins in defense research and development for next generation display solutions, Vuzix holds over 48 patents in the Video Eyewear field. The company has won 11 Consumer Electronics Show Innovations Awards, the RetailVision Best New Product and several wireless technology innovation awards, among others. Founded in 1997, Vuzix is a public company (TSX-V:VZX - News, OTC:BB: VUZI, FMB: V7X) with offices in Rochester, NY, Oxford, UK and Tokyo, Japan. For more information visit www.vuzix.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, please contact:
Grant Russell, CFO
75 Town Centre Drive
Rochester, NY USA
Tel: (585) 359-5910
SOURCE Vuzix Corporation