UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) APRIL 13, 2004
APPLIED DIGITAL SOLUTIONS, INC.
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(Exact name of registrant as specified in its charter)
Missouri 000-26020 43-1641533
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
400 Royal Palm Way, Suite 410, Palm Beach, Florida 33480
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 561-805-8000
ITEM 5. OTHER EVENTS
Securities Purchase Agreement Entered Into On April 13, 2004
On April 13, 2004, Applied Digital Solutions, Inc. (the "Company")
agreed to sell (with a closing scheduled for April 15, 2004) two million
shares (the "Shares") of its common stock, par value $0.01 per share, in a
private placement to an institutional investor, Satellite Strategic Finance
Associates, LLC ("SSFA") under a Securities Purchase Agreement (the
"Agreement"). The Agreement provides SSFA with a Series A Warrant, which is
exercisable into an additional one million shares (the "Series A Warrant
Shares") of the Company's common stock, and a Series B Warrant, which is
exercisable into 666,667 shares (the "Series B Warrant Shares") of the
Company's common stock. The purchase price for the Shares is $2.749 per
share and is based on the average daily volume weighted average price of the
Company's common stock for a period of ten trading days ending on and
including April 13, 2004. The exercise price of the Series A Warrant Shares
and the Series B Warrant Shares is $2.749 and $3.299 per share,
respectively. The Series A Warrant may be exercised at any time, at SSFA's
option, until the 60th day following the effective date of the registration
statement registering the Series A Warrant Shares. The Series B Warrant may
be exercised at any time beginning on the one-year anniversary of the issue
date and expiring on the sixth anniversary of such issue date. Following the
closing, the proceeds from the sale of the Shares are expected to be
approximately $5.5 million.
The offer and sale of these securities by the Company to SSFA is exempt
from the registration requirements of the Securities Act of 1933. The
Company has agreed to effect the registration of the Shares, Series A
Warrant Shares and Series B Warrant Shares pursuant to the Registration
Rights Agreement attached hereto as Exhibit 10.4.
The Securities Purchase Agreement, the form of the Series A Warrant,
the form of the Series B Warrant and the Registration Rights Agreement are
included herein as exhibits.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
10.1 Securities Purchase Agreement between Applied Digital Solutions, Inc.
and Satellite Strategic Finance Associates, LLC, dated as of
April 13, 2004
10.2 Form of Series A Warrant to Purchase Common Stock of Applied Digital
Solutions, Inc., in favor of Satellite Strategic Finance Associates,
LLC
10.3 Form of Series B Warrant to Purchase Common Stock of Applied Digital
Solutions, Inc., in favor of Satellite Strategic Finance
Associates, LLC
10.4 Registration Rights Agreement between Applied Digital Solutions,
Inc. and Satellite Strategic Finance Associates, LLC, dated as of
April 13, 2004
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
APPLIED DIGITAL SOLUTIONS, INC.
(Registrant)
Date: April 14, 2004 By: /s/ Lorraine M. Breece
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Lorraine M. Breece
Vice President and Chief Accounting Officer
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