Holland & Knight Completes $25 Million Acquisition and $17.5 Million Financing for Client Applied Digital Solutions, Inc.
June 17, 2005
Jason Hartley Barker - Portland
Tammy Knight- Ft Lauderdale
MIAMI – Holland & Knight has completed a $25 million acquisition on
behalf of client Applied Digital Solutions, Inc. (NASDAQ: ADSX) of Delray Beach.
The Holland & Knight mergers and acquisitions team, led by Miami partner Harvey
Goldman, included Tammy Knight and Jason Barker.
Applied Digital Solutions' subsidiary, VeriChip Inc. entered into a Share
Purchase Agreement to acquire 100 percent of the common stock of Ontario-based
Instantel, Inc. Under the terms of the agreement, Instantel becomes a
wholly-owned subsidiary of VeriChip.
VeriChip paid $22 million in cash and will issue up to an additional $3
million in the future in some combination of cash, VeriChip common stock and
Applied Digital Solutions common stock, depending on whether and when VeriChip
has an initial public offering of its common stock. Under the terms of a
Registration Rights Agreement, the Company has certain future requirements to
register shares of its common stock.
Instantel is a privately held Canadian company which manufactures
high-quality remote monitoring products in the areas of healthcare security and
vibration monitoring for a diverse customer base. The company’s Xmark® division
specializes in smart tag technology for protecting people and assets in
healthcare environments. Its Hugs® product line is a popular RFID system for
preventing the abduction of newborn infants in hospitals, while the WatchMate®
system is used in long-term care facilities to protect wander-prone residents.
In connection with this acquisition, Applied Digital Solutions issued, in a
private placement, warrants and shares of preferred stock for $12.5 million. The
preferred stock was purchased by Satellite Strategic Finance Associates, LLC and
Satellite Strategic Finance Partners, Ltd., institutional investors. The
preferred stock converts into Applied Digital Solution's common stock at a
premium to the Company's current market price. Applied Digital Solutions also
entered into a debt financing with the same institutional investors for $5
million.
Contact: Susan Berliner, (813) 769-4326