Entry into a Material Definitive Agreement
24, 2018, LogicMark, LLC (“LogicMark”), a wholly owned subsidiary of Nxt-ID, Inc. (the “Company”), and
Sagard Holdings Manager LP
, as administrative agent and collateral agent for the lenders
party to the Credit Agreement (collectively, the “Lender”), entered into a Senior Secured Credit Agreement (the “Credit
Agreement”), whereby the Lender extended a term loan (the “Term Loan”) to LogicMark in the principal amount of
$16,000,000 (the “Debt Financing”). The maturity date of the Term Loan is May 24, 2023. The outstanding principal amount
of the Term Loan bears interest at a rate of LIBOR, adjusted monthly, plus 9.5% per annum. Capitalized terms, not otherwise defined
in this Report shall have their respective meanings ascribed to them in the Credit Agreement or, as applicable, the referenced
Agreement contains customary covenants, including
a covenant that (a) LogicMark shall not permit the Fixed Charge Coverage
Ratio as of the last day of any Fiscal Quarter, beginning with June 30, 2018, to be less than the correlative ratio indicated,
which correlative ratio is initially 3.00 : 1:00 for the Fiscal Quarter beginning June 30, 2018 and increasing by .25 annual increments
for each Fiscal Quarter until March 31, 2021 and thereafter, the correlative ratio is 4.00 : 1.00, and (b) LogicMark shall not
permit the Leverage Ratio as of the last day of any Fiscal Quarter, beginning with June 30, 2018, to exceed the correlative ratio
indicated which correlative ratio is initially 2.60 : 1:00 for the Fiscal Quarter beginning June 30, 2018 and decreasing by various
annual increments until for each Fiscal Quarter until March 31, 2021 and thereafter, the correlative ratio is 2.00 : 1.00.
of LogicMark under the Credit Agreement is secured by: (a) a senior lien granted pursuant to a Security Agreement on all of the
assets of LogicMark, the Company, and 3D-ID, LLC and Fit-Pay, Inc., the Company’s subsidiaries; (b) a senior lien granted
pursuant to an Intellectual Property Security Agreement on all of the intellectual property assets of the foregoing companies;
and (c) a pledge of the Pledged Securities of the foregoing companies pursuant to a Securities Pledge Agreement. The performance
of LogicMark is guaranteed pursuant to a guaranty under a Guaranty Agreement by the Company, 3D-ID, LLC and Fit-Pay, Inc.
foregoing description of the Credit Agreement, the Security Agreement, the Intellectual Property Security Agreement, the Securities
Pledge Agreement, and the Guaranty Agreement, are qualified in their entirety by reference to the provisions of the agreements
filed as Exhibits 10.1, 10.2, 10.3, 10.4, and 10.5, respectively, to this Report, which are incorporated by reference herein.
and Registration Rights
addition to entering into the Credit Agreement, the Company issued two Common Stock Purchase Warrants to the Lender. Each Warrant
is exercisable for an aggregate of 244,081 shares of the Company’s Common Stock. Each Warrant will be exercisable beginning
on May 24, 2018, and will be exercisable for a period of five years. The exercise price per Warrant Share, is $3.90 for the first
Warrant and $4.88 for the second Warrant. The exercise price and the amount of shares of the Company’s common stock issuable
upon exercise of each Warrant is subject to adjustment upon certain events, such as stock splits, combinations, dividends, distributions,
reclassifications, mergers or other corporate change and dilutive issuances. The foregoing description of the Warrants is
qualified in its entirety by reference to the provisions of the form Common Stock Purchase Warrant filed as Exhibit 4.1 to this
Report, which is incorporated by reference herein.
Warrant contains a covenant to register pursuant to which the Company covenants that within 90 days of May 24, 2018, at the Company’s
sole cost and expense, it will file or cause to be filed a Registration Statement covering the sale or resale of the Warrant Shares,
and will promptly provide confirmation of such registration to the Holder. To the extent a legal opinion is required in connection
therewith, such opinion shall be obtained by the Company at the Company’s expense. In no event shall the Company be responsible
for any broker or similar commissions of any Holder or any legal fees or other costs of the Holder.
Global Partners, offering securities through Euro Pacific Capital Inc., served as the Placement Agent for the Company.