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Post by Designer on May 13, 2005 10:59:05 GMT -5
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Post by Designer on May 13, 2005 11:00:18 GMT -5
CMKXTREME, Inc. is mentioned
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GEORGE BUSH
Diamond Miner
shorters beware" your shorts are down"...
Posts: 345
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Post by GEORGE BUSH on May 13, 2005 11:53:22 GMT -5
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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 29, 2005
CRYSTALIX GROUP INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation) 0-29781
(Commission
File Number) 65-0142472
(IRS Employer
Identification No.)
5275 South Arville Street, Suite B-116, Las Vegas, Nevada 89118
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code (702) 740-4616
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
As of April 29, 2005, Crystalix Group International, Inc. (“Crystalix”) executed and delivered to Urban Casavant, as the trustee of the UAJC 2005 Irrevocable Trust (the “Trust”), a convertible promissory note in the principal amount of $1,000,000. The note is secured by Crystalix’s 51% membership interest in Laser Design International, LLC (“LDI”), accrues interest at 10% per annum, is due May 1, 2007, and requires monthly payments of principal and accrued interest beginning July 1, 2005. The loan proceeds are to be funded over a two-year period. The note is convertible as to any payment when due, as to all or any portion of the note upon the sale of 51% or more of Crystalix’s outstanding common stock or sale of all of Crystalix’s assets, or as to a portion of the note not to exceed $1,000,000 upon an event of default. The conversion price is $0.05. The trustee of the Trust is the beneficial owner of CMKXTREME, Inc., which loaned $2,000,000 to Crystalix in September 2004.
Crystalix will use the proceeds from the financing for its purchase of a 51% membership interest in LDI and working capital.
Crystalix has agreed to file a registration statement with the Securities and Exchange Commission in order to register the resale of the shares issuable upon conversion of the notes.
This summary description of the financing described by the documents does not purport to be complete and is qualified in its entirety by reference to the documents that are filed as exhibits hereto.
Also as of April 11, 2005, Crystalix amended and restated its convertible promissory note to CMKXTREME, Inc. Interest accrued through May 31, 2005 under the original note but not paid will be due on the maturity date of October 1, 2007. Monthly principal payments of $83,333 and interest accrued from June 1, 2005 are to begin July 1, 2005. The note is now secured by a security interest in all of Crystalix’s assets.
John S. Woodward, who also has a security interest in all of Crystalix’s assets, has agreed to subordinate his lien and security interest to those of CMKXTREME, Inc. Kevin Ryan, John Woodward, and CMKXTREME, Inc. have agreed to subordinate their liens and security interests to those of the Trust. Kevin Ryan has agreed that the liens and security interests of CMKXTREME, Inc. shall have equal priority with his liens and security interests.
Item 9.01 Financial Statements and Exhibits
Exhibits:
Regulation
S-B Number Document 10.1 Amended and Restated Convertible Promissory Note to CMKXTREME, Inc. dated April 11, 2005
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10.2 Convertible Promissory Note to UAJC 2005 Irrevocable Trust dated April 11, 2005 10.3 Registration Rights Agreement with UAJC 2005 Irrevocable Trust dated April 11, 2005 10.4 Security Agreement with UAJC 2005 Irrevocable Trust dated April 11, 2005 10.5 Security Agreement with CMKXTREME, Inc. dated April 11, 2005 10.6 Subordination Agreement between CMKXTREME, Inc. and John S. Woodward dated April 11, 2005 10.7 Subordination Agreement between UAJC 2005 Irrevocable Trust, CMKXTREME, Inc., Kevin T. Ryan and John S. Woodward dated April 11, 2005 10.8 Intercreditor Agreement between Kevin T. Ryan and CMKXTREME, Inc. dated April 11, 2005 10.9 Amendment to Registration Rights Agreement between the Company and CMKXTREME, Inc. dated April 11, 2005
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
CRYSTALIX GROUP INTERNATIONAL, INC.
May 5, 2005 By: /s/ DOUGLAS E. LEE
Douglas E. Lee, President
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-------------------------------------------------------------------------------- AMENDED AND RESTATED CONVERTIBLE PROMISSORY NOTE
This Amended and Restated Convertible Promissory Note is made as of April 11, 2005, and fully amends and restates the Convertible Promissory Note executed by Crystalix Group International, Inc., a Nevada corporation (“ Borrower ”) in favor of CMKXTREME, Inc., a Nevada corporation (also known as CMKXTREME.com) (“ Lender ”) dated September 23, 2004 (the “ Original Note ”).
Factual Background
A. Borrower executed and delivered the Original Note to Lender on or about September 23, 2004.
B. Borrower failed to make certain payments of principal and interest as provided in the Original Note.
C. Lender and Borrower have agreed to amend and restate the Original Note as set forth below. Among other things, past due interest will be added to principal as set forth below.
Amended and Restated Note
The Original Note is hereby amended and restated to read in full as follows:
$2,000,000 Las Vegas, Nevada September 23, 2004
Crystalix Group International, Inc., a Nevada corporation (“ Borrower ”), promises to pay to the order of CMKXTREME, Inc., a Nevada corporation (“ Lender ”), at 30 Princeville Lane, Las Vegas, Nevada 89113, Two Million Dollars ($2,000,000), with interest on the unpaid principal balance.
1. Interest Rate.
(a) Subject to Section 2(a) and Section 6 below, interest on the unpaid principal balance hereunder shall accrue at the rate of ten percent (10%) per annum (the “ Interest Rate ”) from the date hereof.
(b) The Interest Rate shall be calculated on the basis of the unpaid principal balance hereunder and the actual number of days elapsed over a 365-day year. Notwithstanding anything contained in this Note to the contrary, if collection from Borrower of interest at the Interest Rate would be contrary to applicable laws, then the Interest Rate in effect on any day shall be the highest interest rate which may be collected from Borrower under applicable laws on such day.
2. Payment Schedule.
(a) Interest payable at the Interest Rate through October 31, 2004, and interest at the Default Rate (as defined below) from November 1, 2004 through May 31, 2005 shall be due and payable on the Maturity Date (as defined below).
(b) Commencing on July 1, 2005, and continuing on the first day of each month thereafter, Borrower shall make a principal payment in the amount of $83,333, with all
45931.0004\YOKENS\LAS\82025.4
unpaid interest accruing from and after June 1, 2005 to June 30, 2005 at the Default Rate, and thereafter at the Interest Rate (subject to Section 6 below) on the amounts outstanding under this Note.
(c) All outstanding principal and accrued unpaid interest shall be due and payable on October 1, 2007 (the “ Maturity Date ”), as such date may be accelerated pursuant to Section 5.
3. Amounts due hereunder shall be paid by Borrower to Lender as follows:
(a) Except as provided below in Section 3(b), all payments (including payment and prepayments of principal of or other amounts in respect of the Advances or fees or other amounts) required under this Note shall be made by the Borrower to the Lender in lawful money of the United States of America and in immediately available funds.
(b) From time to time, Lender may require Borrower to make any payment of the Convertible Portion (as defined below) of Borrower’s obligations under this Note in shares of Common Stock of Borrower (“Common Shares”) instead of lawful money of the United States of America and thereby convert all or any part of such Convertible Portion into that number of Common Shares, as is obtained by dividing the dollar amount that Lender elects to convert by the applicable Conversion Price (as defined below).
(c) Subject to adjustment as provided in this Section, the “ Conversion Price ” shall be the lesser of (i) the average closing price of the Common Shares for the five (5) business days immediately prior to Lender’s delivery of notice of conversion, or (ii) $0.08. The “ Convertible Portion ” means (w) any payment of principal, interest, and any other amounts payable to Lender hereunder when due, (x) any prepayment tendered by Borrower under this Note, (y) all or any portion of the entire amount of Borrower’s obligations under this Note, upon a sale of fifty-one percent (51%) or more of the outstanding Common Stock of Borrower or a sale of all or substantially all of Borrower’s assets, or (z) if an Event of Default (as defined below) occurs, a portion of Borrower’s obligations under this Note not exceeding One Million Dollars ($1,000,000); provided, however , that upon the occurrence of a second Event of Default while the first Event of Default remains uncured, the entire amount of principal, interest and any other amounts payable by Lender hereunder shall be the Convertible Portion.
(d) Within ten (10) days after delivery to Borrower of a notice of conversion with respect to that portion of the outstanding and unpaid principal or interest that Lender wishes to convert, Borrower shall (i) denote in its corporate records the ownership by Lender of the Common Shares so purchased, and (ii) unless this Note has been fully repaid or converted in full, issue to Lender a new Note, in identical form hereto and duly executed by Borrower, representing the portion of the Debt that has not been converted or repaid.
(e) If Borrower shall (i) declare a dividend or make a distribution payable in Common Shares, (ii) subdivide or reclassify its outstanding Common Shares into a greater number of Common Shares, or (iii) combine its outstanding Common Shares into a smaller number of Common Shares, the Conversion Price in effect at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination, or reclassification
45931.0004\YOKENS\LAS\82025.4 2
shall be proportionately reduced in the case of any increase in the number of Common Shares outstanding, and increased in the case of any reduction in the number of Common Shares outstanding, so that Lender shall be entitled to receive the kind and amount of Common Shares which Lender would have owned or have been entitled to receive had this Note been converted into Common Shares immediately prior to such time and had such Common Shares received such dividend or other distribution or participated in such subdivision, combination, or reclassification. Such adjustment shall be effective as of the record date for such dividend or distribution or the effective date of such combination, subdivision or reclassification and shall be made successively whenever any event listed above shall occur.
(f) Whenever the Conversion Price is adjusted as provided in Section 3(d), Borrower shall promptly deliver to Lender written notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof.
(g) In the event of any consolidation or merger of Borrower with or into any other Person (other than a merger which does not result in any reclassification, conversion, exchange or cancellation of outstanding Common Shares), or in the event of any sale or transfer of all or substantially all of the assets of Borrower or the reclassification of the Common Shares into another form of capital stock of Borrower, whether in whole or in part, this Note shall thereafter be convertible, in lieu of the Common Shares otherwise purchasable and receivable upon conversion of this Note, into the kind and amount of stock and other securities and property or cash which Lender would have been entitled to receive upon such consolidation, merger, sale, transfer or reclassification if Lender had held the Common Shares issuable upon the conversion of this Note immediately prior to such consolidation, merger, sale, transfer or reclassification. The provisions of this Section 3 shall similarly apply to successive reclassification and changes of Common Shares of capital of Borrower and to successive consolidations, mergers, sales, transfers or reclassifications.
(h) Borrower shall at all times reserve and keep available, free from pre-emptive rights, out of its authorized but unissued shares of common stock, solely for the purpose of issue upon conversion of this Note as herein provided, such number of Common Shares as shall then be issuable upon the conversion of this Note. Borrower covenants that all Common Shares which shall be so issuable shall, upon issuance, be duly and validly issued and fully paid and non-assessable. Borrower shall from time to time, in accordance with applicable law, increase the authorized amount of its Common Shares if at any time the authorized amount of its Common Shares remaining unissued shall not be sufficient to permit the conversion of all Notes at the time outstanding.
(i) The Lender shall not be able to convert any amount due under the Note, if such conversion would result in the Lender and all other affiliates of Urban Casavant holding more than 9.99% of the Borrower’s outstanding shares of common stock, including derivative securities exercisable within sixty (60) days.
4. This Note is secured by a certain Security Agreement by and between Lender and Borrower dated as of April 11, 2005. Lender’s rights under such Security Agreement are subject
45931.0004\YOKENS\LAS\82025.4 3
to a certain Intercreditor Agreement by and between Lender and Kevin T. Ryan dated as of April 11, 2005.
5. Upon any Event of Default, as such term is defined in this Section 5, Lender may accelerate the loan evidenced by this Note and declare the entire principal balance of the Note immediately due and payable, and shall have the rights provided herein and by applicable law. The occurrence of any of the following events shall constitute an “ Event of Default ” under this Note:
(a) Borrower fails to make any payment of interest or principal within five (5) days after the date when due under this Note.
(b) The dissolution of Borrower, whether pursuant to any applicable laws, or otherwise, or the sale, transfer or conveyance by Borrower of fifty percent (50%) or more of the outstanding voting interests of stock of Borrower or the equity interest in Borrower to any person or entity.
(c) Borrower commences a case or other proceeding, or if an involuntary case or other proceeding shall be commenced against Borrower seeking liquidation, reorganization or other relief with respect to its debts under any bankruptcy, insolvency or other similar debtor relief law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and any such involuntary case or other proceeding shall remain undismissed and unstayed for a period of sixty (60) days.
(d) Borrower shall make an assignment for the benefit of creditors, or admit in writing its inability to pay its debts generally as they become due.
(e) A notice of lien, levy or assessment is filed of record or given to Borrower with respect to all or any of the Borrower’s assets by any federal, state, local department or agency, and such lien, levy or assessment is not released or paid within a reasonable period of time but in no event longer than twenty (20) days from the date such lien, levy or assessment is filed.
(f) Lender, in good faith, believes the prospect of payment or performance by Borrower under this Note is impaired and if Borrower is unable or unwilling to provide adequate written assurances to Lender of its ability to fully perform under this Note within thirty (30) days following delivery of written notice.
(g) Any representation or warranty of Borrower is not materially true, correct and complete, or if any material statement, report or certificate made or delivered by Borrower or its officers, employees or agents is not true, correct and complete when made.
6. If any Event of Default shall occur, the total of the unpaid balance of principal and the accrued unpaid interest (past due interest being compounded) shall then begin accruing interest at the rate stated in the first paragraph above plus eight percent (8.00%) per annum (the “ Default Rate ”), until such time as all past due payments and accrued interest are paid. Borrower acknowledges that the effect of this Default Rate provision could operate to compound some of
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GEORGE BUSH
Diamond Miner
shorters beware" your shorts are down"...
Posts: 345
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Post by GEORGE BUSH on May 13, 2005 11:53:56 GMT -5
45931.0004\YOKENS\LAS\82025.4 4
the interest obligations due, and Borrower hereby expressly assents to such compounding should it occur.
7. Borrower:
(a) waives demand, diligence, presentment for payment, protest and demand, notice of extension, dishonor, protest, demand and non-payment of this Note; and
(b) agrees that Borrower will pay any collection expenses, court costs and actual attorney’s fees which may be incurred by Lender in the collection or enforcement of this Note.
8. This Note may be prepaid in whole or in part at any time. 9. This Note shall be construed according to the laws of the State of Nevada.
10. All notices, requests and other communications hereunder must be in writing and will be deemed to have been duly given only if delivered personally or by facsimile transmission or mailed (first class postage prepaid) to the parties at the following addresses or facsimile numbers:
If to Borrower: Crystalix Group International, Inc.
5275 South Arville Street, Suite B116
Las Vegas, Nevada 89118
Attn: Doug Lee, President
Fax No.: (702) 740-4611
with a copy to: Snell & Wilmer L.L.P.
3800 Howard Hughes Parkway, Suite 1000
Las Vegas, Nevada 89109
Attn: Stephen B. Yoken, Esq.
Fax No.: (702) 784-5252
If to Lender: CMKXTREME, Inc.
30 Princeville Lane
Las Vegas, Nevada 89113
Attn: Urban Casavant
Fax. No.: (702) 247-1307
[Signatures appear on next page]
45931.0004\YOKENS\LAS\82025.4 5
IN WITNESS WHEREOF, Borrower has caused this Note to be executed as of the date first set forth above.
BORROWER:
Crystalix Group International, Inc.
By: ________________________________
Doug Lee, President
By: ________________________________
Patty Hill, Secretary
ACCEPTANCE BY LENDER
The Undersigned, CMKXTREME, Inc., a Nevada corporation, hereby approves and accepts the foregoing Amended and Restated Convertible Promissory Note in place of the Original Note (as defined therein), and also confirms that it was identified as “CMKXTREME.com” in such Original Note and in certain other documents which it executed as of September 23, 2004.
CMKXTREME, Inc.,
a Nevada corporation
By: ______________________________
Urban Casavant, President
45931.0004\YOKENS\LAS\82025.4 6
CONVERTIBLE PROMISSORY NOTE
$1,000,000 Las Vegas, Nevada April 11, 2005
Crystalix Group International, Inc., a Nevada corporation (“ Borrower ”), promises to pay to the order of Urban Casavant, as Trustee of the UAJC 2005 Irrevocable Trust (“ Lender ”), at 30 Princeville Lane, Las Vegas, Nevada 89113, One Million Dollars ($1,000,000), with interest on the unpaid principal balance.
By acceptance of this Note, Lender agrees to disburse the loan evidenced by this Note as provided in the Funding Schedule attached as Exhibit A to this Note.
1. Interest Rate.
(a) Subject to Section 6 below, interest on the unpaid principal balance hereunder shall accrue at the rate of ten percent (10%) per annum (the “ Interest Rate ”) from the date hereof.
(b) The Interest Rate shall be calculated on the basis of the unpaid principal balance hereunder and the actual number of days elapsed over a 365-day year. Notwithstanding anything contained in this Note to the contrary, if collection from Borrower of interest at the Interest Rate would be contrary to applicable laws, then the Interest Rate in effect on any day shall be the highest interest rate which may be collected from Borrower under applicable laws on such day.
2. Payment Schedule.
(a) Commencing on July 1, 2005, and continuing on the first day of each month thereafter, Borrower shall make a principal payment in the amount of the Required Monthly Payment with all accrued unpaid interest on the amounts outstanding under this Note. “ Required Monthly Payment ” means the amount of principal advanced by Lender to the date of each such payment, divided by twenty-two (22).
(b) All outstanding principal and accrued unpaid interest shall be due and payable on May 1, 2007 (the “ Maturity Date ”), as such date may be accelerated pursuant to Section 5.
3. Amounts due hereunder shall be paid by Borrower to Lender as follows:
(a) Except as provided below in Section 3(b), all payments (including payment and prepayments of principal of or other amounts in respect of the Advances or fees or other amounts) required under this Note shall be made by the Borrower to the Lender in lawful money of the United States of America and in immediately available funds.
(b) From time to time, Lender may require Borrower to make any payment of the Convertible Portion (as defined below) of Borrower’s obligations under this Note in shares of Common Stock of Borrower (“Common Shares”) instead of lawful money of the United States of America and thereby convert all or any part of such Convertible Portion into that number of
45931.0004\YOKENS\LAS\82314.4
Common Shares, as is obtained by dividing the dollar amount that Lender elects to convert by the applicable Conversion Price (as defined below).
(c) Subject to adjustment as provided in this Section, the “ Conversion Price ” shall be $0.05. The “ Convertible Portion ” means (w) any payment of principal, interest, and any other amounts payable to Lender hereunder when due, (x) any prepayment tendered by Borrower under this Note, (y) all or any portion of the entire amount of Borrower’s obligations under this Note, upon a sale of fifty-one percent (51%) or more of the outstanding Common Stock of Borrower or a sale of all or substantially all of Borrower’s assets, or (z) if an Event of Default (as defined below) occurs, a portion of Borrower’s obligations under this Note not exceeding One Million Dollars ($1,000,000); provided, however , that upon the occurrence of a second Event of Default while the first Event of Default remains uncured, the entire amount of principal, interest and any other amounts payable by Lender hereunder shall be the Convertible Portion.
(d) Within ten (10) days after delivery to Borrower of a notice of conversion with respect to that portion of the outstanding and unpaid principal or interest that Lender wishes to convert, Borrower shall (i) denote in its corporate records the ownership by Lender of the Common Shares so purchased, and (ii) unless this Note has been fully repaid or converted in full, issue to Lender a new Note, in identical form hereto and duly executed by Borrower, representing the portion of the Debt that has not been converted or repaid.
(e) If Borrower shall (i) declare a dividend or make a distribution payable in Common Shares, (ii) subdivide or reclassify its outstanding Common Shares into a greater number of Common Shares, or (iii) combine its outstanding Common Shares into a smaller number of Common Shares, the Conversion Price in effect at the time of the record date for such dividend or distribution or the effective date of such subdivision, combination, or reclassification shall be proportionately reduced in the case of any increase in the number of Common Shares outstanding, and increased in the case of any reduction in the number of Common Shares outstanding, so that Lender shall be entitled to receive the kind and amount of Common Shares which Lender would have owned or have been entitled to receive had this Note been converted into Common Shares immediately prior to such time and had such Common Shares received such dividend or other distribution or participated in such subdivision, combination, or reclassification. Such adjustment shall be effective as of the record date for such dividend or distribution or the effective date of such combination, subdivision or reclassification and shall be made successively whenever any event listed above shall occur.
(f) Whenever the Conversion Price is adjusted as provided in Section 3(d), Borrower shall promptly deliver to Lender written notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment and the computation thereof.
(g) In the event of any consolidation or merger of Borrower with or into any other Person (other than a merger which does not result in any reclassification, conversion, exchange or cancellation of outstanding Common Shares), or in the event of any sale or transfer of all or substantially all of the assets of Borrower or the reclassification of the Common Shares into another form of capital stock of Borrower, whether in whole or in part, this Note shall thereafter be convertible, in lieu of the Common Shares otherwise purchasable and receivable
45931.0004\YOKENS\LAS\82314.4 2
upon conversion of this Note, into the kind and amount of stock and other securities and property or cash which Lender would have been entitled to receive upon such consolidation, merger, sale, transfer or reclassification if Lender had held the Common Shares issuable upon the conversion of this Note immediately prior to such consolidation, merger, sale, transfer or reclassification. The provisions of this Section 3 shall similarly apply to successive reclassification and changes of Common Shares of capital of Borrower and to successive consolidations, mergers, sales, transfers or reclassifications.
(h) Borrower shall at all times reserve and keep available, free from pre-emptive rights, out of its authorized but unissued shares of common stock, solely for the purpose of issue upon conversion of this Note as herein provided, such number of Common Shares as shall then be issuable upon the conversion of this Note. Borrower covenants that all Common Shares which shall be so issuable shall, upon issuance, be duly and validly issued and fully paid and non-assessable. Borrower shall from time to time, in accordance with applicable law, increase the authorized amount of its Common Shares if at any time the authorized amount of its Common Shares remaining unissued shall not be sufficient to permit the conversion of all Notes at the time outstanding.
(i) The Lender shall not be able to convert any amount due under the Note, if such conversion would result in the Lender and all other affiliates of Urban Casavant holding more than 9.99% of the Borrower’s outstanding shares of common stock, including derivative securities exercisable within sixty (60) days.
4. This Note is secured by a certain Security Agreement by and between Lender and Borrower dated as of April 11, 2005. Lender’s rights under such Security Agreement are affected by a certain Subordination Agreement by and between Lender, Kevin T. Ryan, CMKXTREME, Inc, a Nevada corporation, and John S. Woodward, dated as of April 11, 2005.
5. Upon any Event of Default, as such term is defined in this Section 5, Lender may accelerate the loan evidenced by this Note and declare the entire principal balance of the Note immediately due and payable, and shall have the rights provided herein and by applicable law. The occurrence of any of the following events shall constitute an “ Event of Default ” under this Note:
(a) Borrower fails to make any payment of interest or principal within five (5) days after the date when due under this Note.
(b) The dissolution of Borrower, whether pursuant to any applicable laws, or otherwise, or the sale, transfer or conveyance by Borrower of fifty percent (50%) or more of the outstanding voting interests of stock of Borrower or the equity interest in Borrower to any person or entity.
(c) Borrower commences a case or other proceeding, or if an involuntary case or other proceeding shall be commenced against Borrower seeking liquidation, reorganization or other relief with respect to its debts under any bankruptcy, insolvency or other similar debtor relief law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, and any such
45931.0004\YOKENS\LAS\82314.4 3
involuntary case or other proceeding shall remain undismissed and unstayed for a period of sixty (60) days.
(d) Borrower shall make an assignment for the benefit of creditors, or admit in writing its inability to pay its debts generally as they become due.
(e) A notice of lien, levy or assessment is filed of record or given to Borrower with respect to all or any of the Borrower’s assets by any federal, state, local department or agency, and such lien, levy or assessment is not released or paid within a reasonable period of time but in no event longer than twenty (20) days from the date such lien, levy or assessment is filed.
(f) Lender, in good faith, believes the prospect of payment or performance by Borrower under this Note is impaired and if Borrower is unable or unwilling to provide adequate written assurances to Lender of its ability to fully perform under this Note within thirty (30) days following delivery of written notice.
(g) Any representation or warranty of Borrower is not materially true, correct and complete, or if any material statement, report or certificate made or delivered by Borrower or its officers, employees or agents is not true, correct and complete when made.
6. If any Event of Default shall occur, the total of the unpaid balance of principal and the accrued unpaid interest (past due interest being compounded) shall then begin accruing interest at the rate stated in the first paragraph above plus eight percent (8.00%) per annum (the “ Default Rate ”), until such time as all past due payments and accrued interest are paid. Borrower acknowledges that the effect of this Default Rate provision could operate to compound some of the interest obligations due, and Borrower hereby expressly assents to such compounding should it occur.
7. Borrower:
(a) waives demand, diligence, presentment for payment, protest and demand, notice of extension, dishonor, protest, demand and non-payment of this Note; and
(b) agrees that Borrower will pay any collection expenses, court costs and actual attorney’s fees which may be incurred by Lender in the collection or enforcement of this Note.
8. This Note may be prepaid in whole or in part at any time. 9. This Note shall be construed according to the laws of the State of Nevada.
10. All notices, requests and other communications hereunder must be in writing and will be deemed to have been duly given only if delivered personally or by facsimile transmission or mailed (first class postage prepaid) to the parties at the following addresses or facsimile numbers:
45931.0004\YOKENS\LAS\82314.4 4
If to Borrower: Crystalix Group International, Inc.
5275 South Arville Street, Suite B116
Las Vegas, Nevada 89118
Attn: Doug Lee, President
Fax No.: (702) 740-4611
with a copy to: Snell & Wilmer L.L.P.
3800 Howard Hughes Parkway, Suite 1000
Las Vegas, Nevada 89109
Attn: Stephen B. Yoken, Esq.
Fax No.: (702) 784-5252
If to Lender: Urban Casavant, as Trustee
of the UAJC 2005 Irrevocable Trust
30 Princeville Lane
Las Vegas, Nevada 89113
Fax. No.: (702) 247-1307
IN WITNESS WHEREOF, Borrower has caused this Note to be executed as of the date first set forth above.
BORROWER:
Crystalix Group International, Inc.
By: ________________________________
Doug Lee, President
By: ________________________________
Patty Hill, Secretary
45931.0004\YOKENS\LAS\82314.4 5
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of April 11, 2005, is by and between Crystalix Group International, Inc., a Nevada corporation (the “Company”), and Urban Casavant, as Trustee of the UAJC 2005 Irrevocable Trust (“Lender”).
RECITALS
A. Lender has agreed to loan to the Company One Million Dollars ($1,000,000.00) (the “Loan”), which Loan is convertible into Common Stock, provided, among other things, that certain securities registration rights are granted to Lender.
B. The Company deems it desirable for the Company to grant certain securities registration rights to Lender in order to induce Lender to make such Loan to the Company.
AGREEMENTS
In consideration of the recitals and the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions . As used in this Agreement:
(a) “Affiliate” shall have the meaning set forth in Rule 12b-2 of the Securities Exchange Act.
(b) “Commission” means the United States Securities and Exchange Commission.
(c) “Common Stock” means common stock of the Company.
(d) “Person” means a natural person, a partnership, a corporation, an association, a joint-stock company, a trust, a joint venture, an unincorporated organization or a governmental entity or any department, agency or political subdivision thereof or any other entity.
(e) “Registrable Shares” means the Common Stock to be issued pursuant to conversion of the Loan or any part thereof, provided , however, that Registrable Shares shall not include any shares of Common Stock the sale of which has been registered and consummated pursuant to the Securities Act or which have been sold pursuant to Rule 144.
(f) “Registration Expenses” has the meaning ascribed to he in Section 6 of this Agreement.
(g) “Rule 144” means Rule 144 promulgated by the Commission under the Securities Act, as amended from time to time, and any successor provision with respect thereto.
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(h) “Rule 144A” means Rule 144A promulgated by the Commission under the Securities Act, as amended from time to time, and any successor provision with respect thereto.
(i) “Securities Act” means the Securities Act of 1933, as amended.
(j) “Securities Exchange Act” means the Securities Exchange Act of 1934, as amended.
2. Form Registrations . Upon request of Lender not less than thirty (30) days after the effectiveness of the currently pending SB-2 registration, File No. 333-122747, the Company shall commence and thereafter prosecute with reasonable diligence an application for registration under the Securities Act on Form SB-2, or any applicable form registration statement, of such aggregate number of shares as would be issued to Lender if he exercised his conversion rights as to the entire principal amount of the Loan; provided, however, that Lender shall continue to have the option of converting all or any part of the Loan to Common Stock as provided in the promissory note evidencing the Loan. At any time after the date of this Agreement, Lender may request registration of additional Registrable Shares (if the total number of Registrable Shares exceeds the number already registered or as to which registration is in process) by delivering a written notice to the Company to that effect; provided , however, that the aggregate offering value of the Registrable Shares requested to be registered in any such registration must be reasonably expected to equal at least $250,000. Any registration effected or requested pursuant to this Section 2, other than a Piggyback Registration (as that term is defined in Section 3(a)), is referred to herein as a “Form Registration”.
3. Piggyback Registrations
(a) Right to Piggyback . Whenever (i) the Company intends to sell its securities in a primary offering pursuant to a registration statement filed with the Commission, or whenever securities of the Company then issued and outstanding are to be registered under the Securities Act (other than pursuant to a Form Registration), and (ii) the registration statement to be filed by the Company does not relate to securities under any employee benefit plan and is not with respect to any merger, corporate reorganization or other transaction under Rule 145 of the Securities Act or any similar rule of the Commission (including Form S-4 or any form substituted therefor), and (iii) the form of registration statement intended by the Company to be used may be used for the registration of Registrable Shares (a “Piggyback Registration”), the Company will give Lender prompt written notice (such notice to be at least 10 business days prior to the date of filing such registration statement) of the Company’s intention to effect such a registration. The Company will include in such registration, subject to the terms of this Section 3, all Registrable Shares with respect to which the Company receives a written request (a “Participation Request”) by Lender for inclusion therein within 10 days after the Company’s notice to Lender has been given.
(b) Priority on Primary Registrations . If a Piggyback Registration is an underwritten primary registration on behalf of the Company and the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number (the “Maximum Primary Number”) which can be sold in such offering without having a material adverse effect on the price of such securities,
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the Company will include in such registration, up to the Maximum Primary Number, (i) first , the securities the Company proposes to sell, and (ii) second , the Registrable Shares requested to be included in such registration by Lender.
(c) Priority on Secondary Registrations . If a Piggyback Registration is an underwritten secondary registration at the request of holders of the Company’s securities (other than Lender) and the managing underwriters advise the Company in writing that in their opinion the number of securities requested to be included in such registration exceeds the number (the “Maximum Secondary Number”) which can be sold in such offering without having a material adverse effect on the price of such securities, the Company will include in such registration, up to the Maximum Secondary Number, (i) first , the securities requested to be included therein by the holders (other than Lender) requesting such registration, and (ii) second , the Registrable Shares requested by Lender to be included in such registration.
(d) Lender may not participate in any underwritten Piggyback Registration unless Lender (i) agrees to sell it Registrable Shares thereunder on the basis provided in any underwriting arrangements approved by the Company, and (ii) completes and executes all reasonable and customary questionnaires, powers of attorney, if any, indemnities, underwriting agreements and other documents which are required under the terms of the underwriting arrangement approved by the Company.
(e) The Company will have the sole and exclusive right to select the managing underwriter(s) to administer any underwritten Piggyback Registration in which Lender participates.
4. Holdback . Lender agrees not to effect any public sale or distribution of Registrable Shares, including any public sale pursuant to Rule 144, or any securities convertible into or exchangeable or exercisable for Registrable Shares, during the 10 days prior to and the 90-day period beginning on the effective date of any underwritten Piggyback Registration (except as part of such underwritten registration) in which Lender was entitled to participate, unless the underwriters managing the registered public offering or the Company otherwise agree. During such period, the Company may impose stop-transfer instructions with respect to Registrable Shares to prohibit transfers in violation of this Agreement.
5. Registration Procedures . Whenever Lender requests that any Registrable Shares be registered pursuant to the terms of this Agreement, the Company will use reasonable efforts to effect the registration and the sale of such Registrable Shares in accordance with Commission requirements, and pursuant thereto, the Company will, as soon as practicable:
(a) prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all Registrable Shares covered by such registration;
(b) furnish to Lender such number of copies of such registration statement, each amendment and supplement thereto, the prospectus included therein (including each
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GEORGE BUSH
Diamond Miner
shorters beware" your shorts are down"...
Posts: 345
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Post by GEORGE BUSH on May 13, 2005 11:55:15 GMT -5
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preliminary prospectus) and such other documents as Lender may reasonably request in order to facilitate the disposition of the Registrable Shares contemplated by such registration;
(c) use reasonable efforts to register or qualify such Registrable Shares under such other securities or blue-sky laws of such jurisdictions as Lender reasonably requests and do any and all other acts and things which may be reasonably necessary or advisable to enable Lender to consummate the disposition in such jurisdictions of the Registrable Shares contemplated by such registration ( provided , however, that the Company will not be required to (i) qualify generally to do business in any jurisdiction where he would not otherwise be required to qualify but for this paragraph, (ii) subject itself to taxation in any such jurisdiction or (iii) consent to general service of process in any such jurisdiction);
(d) use reasonable efforts to list all such Registrable Shares on each securities exchange or stock quotation service on which the Common Stock is then listed;
(e) provide a transfer agent and registrar for all such Registrable Shares not later than the effective date of such registration statement;
(f) notify Lender, promptly after the Company receives notice thereof, of the time when such registration has become effective or a supplement to any prospectus forming a part of such registration statement has been filed;
(g) notify Lender of any request by the Commission for the amending or supplementing of such registration statement or prospectus or for additional information;
(h) prepare and promptly file with the Commission and promptly notify Lender of the filing of any amendment or supplement to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Securities Act, any event shall have occurred as the result of which any such prospectus or any other prospectus as then in effect would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading; and
(j) advise Lender, promptly after the Company receives notice or obtains knowledge thereof, of the issuance of any stop order by the Commission suspending the effectiveness of such registration statement or the initiation or threatening of any proceeding for such purpose and promptly use reasonable efforts to prevent the issuance of any stop order or to obtain it withdrawal if such stop order should be issued.
6. Registration Expenses . All expenses incurred by the Company in connection with its performance of or compliance with this Agreement, including, without limitation, all registration and filing fees, fees and expenses of compliance with securities or blue-sky laws, printing expenses, messenger and delivery expenses and fees and disbursements of counsel for the Company and its independent certified public accountants and other Persons reasonably retained by the Company (all such expenses being herein called “Registration Expenses”), will be borne by the Company. The Company will have no obligation to pay or reimburse Lender or
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any of it agents for any expenses (including, without limitation, legal expenses) incurred by or on behalf of Lender in connection with this Agreement or the transactions contemplated hereby.
7. Indemnification
(a) The Company agrees to indemnify, to the fullest extent permitted by law, Lender, its officers and directors against all losses, claims, damages and liabilities which Lender or any of its officers or directors may become subject to under the Securities Act or otherwise insofar as such losses, claims, damages and liabilities (actions or proceedings) arise out of or are based upon any untrue or alleged untrue statement of any material fact contained in any registration statement under which such Registrable Shares were registered under the Securities Act, any prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Company will reimburse Lender and each such officer and director for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, liability, action or proceeding; except insofar as the same arises out of or is based upon an untrue or alleged untrue statement of a material fact or omission or alleged omission of a material fact made in such registration statement, prospectus, preliminary prospectus, amendment or supplement in reliance upon and in conformity with written information furnished to the Company by Lender or any officer or director thereof expressly for use therein or by Lender’s failure to deliver a copy of the registration statement or prospectus or any amendments or supplements thereto after the Company has furnished Lender with a sufficient number of copies of the same.
(b) In connection with each registration statement covering any Registrable Shares, Lender will furnish to the Company in writing such information and affidavits with respect to (i) the number of shares of Common Stock owned by Lender and the nature of such ownership, (ii) Lender’s authority to sell the Registrable Shares as contemplated in the registration statement, (iii) the method of distribution of such Registrable Shares, and (iv) such other reasonable and customary information for use in connection with any such registration statement or prospectus and, to the fullest extent permitted by law, will indemnify the Company, it directors and officers against any losses, claims, damages and liabilities which the Company and any such officer or director may become subject to under the Securities Act or otherwise insofar as such losses, claims, damages and liabilities (actions or proceedings) arise out of or are based upon any untrue or alleged untrue statement of any material fact contained in such registration statement, any prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, which statement or alleged statement or omission or alleged omission was made in reliance upon and conformity with written information furnished in writing to the Company by Lender or any officer or director thereof expressly for use therein, and Lender shall reimburse the Company and each of it officers and directors for any legal and other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, liability, action or proceeding.
(c) Any Person entitled to indemnification hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which he seeks indemnification and, (ii) unless in such indemnified party’s reasonable judgment a conflict of
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interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. An indemnifying party that is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim. Notwithstanding any other provision of this Section 7, an indemnifying party will not be required to indemnify any indemnified party in respect of any amount paid or agreed to be paid by such indemnified party in settlement of any losses, claims, damages or liabilities asserted against such indemnified party if such settlement is effected without the consent of the indemnifying party.
(d) The indemnification and contribution provided for under this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of the indemnified party.
8. Compliance with Rule 144 and Rule 144A
(a) If Lender proposes to sell any Registrable Shares in compliance with Rule 144, the Company will at Lender’s request (i) promptly furnish to Lender a written statement of compliance with the filing requirements of the Commission as set forth in Rule 144 and (ii) use reasonable efforts to make available to the public and Lender such information as will enable Lender to make sales of such Registrable Shares pursuant to Rule 144.
(b) If Lender proposes to sell any Registrable Shares in compliance with Rule 144A, the Company will, at Lender’s request or at the written request of any prospective purchaser (other than competitors of the Company) of such Registrable Shares, promptly provide (but in any case within 15 days of such request) to Lender or potential purchaser the following information:
(i) a brief statement of the nature of the business of the Company and the Company’s subsidiaries, if any, and the products and services they offer;
(ii) the most recent consolidated balance sheets and profit and losses and retained earnings statements and similar financial statements of the Company for such part of the two preceding fiscal years prior to such request as the Company has been in operation (such financial information will be audited to the extent reasonably available); and
(iii) such other information about the Company, any subsidiaries and their business, financial condition and results of operations as Lender or such prospective purchaser requests in order to comply with Rule 144A, as amended, and the antifraud provisions of the federal and state securities laws.
The Company hereby represents and warrants to Lender and any prospective purchaser of Registrable Shares from Lender that the information provided by the Company pursuant to this Section 8(b) will not contain any untrue statement of a material fact or omit to state a material
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fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.
9. No Inconsistent Agreements . The Company represents that it has not entered into and agrees that he will not hereafter enter into any agreement with respect to its securities which would in any manner conflict with, restrict or be inconsistent with the rights granted to Lender in this Agreement and the performance by the Company of its obligations hereunder.
10. Remedies . Any Person having rights under any provision of this Agreement will be entitled to enforce such rights specifically, to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights granted by law.
11. Amendments and Waivers . Except as otherwise expressly provided herein, the provisions of this Agreement may be amended or waived at any time only by the written agreement of the parties hereto. Any waiver, permit, consent or approval of any kind or character on the part of either party hereto of any provision or condition of this Agreement must be made in writing and shall be effective only to the extent specifically set forth in writing.
12. No Assignment . Neither party hereto may assign any of its rights or delegate any of its obligations hereunder without the prior written consent of the other party. In no event will the rights afforded to Lender hereunder be assignable or otherwise transferable in connection with any sale, assignment, transfer or other disposition of any Registrable Shares, and such rights, to the extent applicable to any such Registrable Shares, will automatically terminate and expire upon the sale, assignment, transfer or other disposition of such Registrable Shares.
13. Successors and Assigns . Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of either party hereto will bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto.
14. Notices . Any notice provided for in this Agreement must be in writing and must be either (a) personally delivered, (b) mailed by registered or certified first-class mail, prepaid with return receipt requested, (c) sent by a recognized overnight-courier service, to the recipient at the address below indicated, or (d) sent by facsimile which is confirmed in writing by sending a copy of such facsimile to the recipient thereof pursuant to clause (a) or (c) above:
To the Company: Crystalix Group International, Inc
5275 South Arville Street, Suite B116
Las Vegas, Nevada 89118
Attn: Doug Lee, President
Facsimile No: (702) 740-4611
To Lender: Urban Casavant, as Trustee
of the UAJC 2005 Irrevocable Trust
30 Princeville Lane
Las Vegas, Nevada 89113
Facsimile No.: (702) 247-1307
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or such other address or to the attention of such other Person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given (w) on the date such notice is personally delivered, (x) four days after the date of mailing if sent by certified or registered mail, (y) one day after the date such notice is delivered to the overnight-courier service if sent by overnight courier or, (z) with respect to facsimiles, on the earlier of one day after the date such facsimile is delivered to the overnight courier for confirmation and confirmation by telephone to the number designated herein; provided , however, that in each case notices received after 4:00 p.m. (local time of the recipient) shall be deemed to have been duly given on the next business day.
15. GOVERNING LAW . ALL QUESTIONS CONCERNING THE VALIDITY, MEANING AND EFFECT OF THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THAT STATE.
16. Severability . Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.
17. Headings . The headings and captions contained herein are for convenience only and shall not control or affect the meaning or construction of any provision hereof.
18. Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original and which together shall constitute one and the same instrument.
19. Final Agreement . This Agreement constitutes the final agreement of the parties concerning the matters referred to herein and supersedes all prior agreements and understandings.
20. Representations and Warranties . Each party to this Agreement represents and warrants to the other party hereto that (i) all action on the part of such party necessary for the authorization, execution, delivery and performance of this Agreement has been taken and (ii) this Agreement is a legal, valid and binding obligation of such party, enforceable against such party in accordance with it terms.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.
By:
Urban Casavant as Trustee of the
UAJC 2005 Irrevocable Trust Crystalix Group International, Inc.
By:
Doug Lee, President
By:
Patty Hill, Secretary 8
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SECURITY AGREEMENT
THIS SECURITY AGREEMENT (the “ Agreement ”) is made as of April 11, 2005, by Crystalix Group International, Inc., a Nevada corporation (“ Debtor ”), for the benefit of Urban Casavant as Trustee of the UAJC 2005 Irrevocable Trust (the “ Secured Party ” or “ Lender ”).
Factual Background
A. This Agreement is executed by Debtor for the purpose of inducing Lender to make a loan to Debtor in the sum of One Million Dollars ($1,000,000) (“ Loan ”) evidenced by a certain Convertible Promissory Note executed by Debtor in favor of Lender dated April 11, 2005 (referred to as the “ Note ”). Debtor has agreed to grant to Secured Party a first lien perfected security interest in certain property of Debtor as described in Exhibit A attached hereto (collectively, the “ Collateral ”).
B. The Collateral is or will be subject to the following additional Security Interests (the “ Permitted Security Interests ”):
1. A security interest in favor of Kevin T. Ryan under a certain Security Agreement dated December 23, 2002, as amended, which secures a certain Amended and Restated Convertible Promissory Note dated July 21, 2004, payable to Kevin T. Ryan in the amount of Five Million Three Hundred Ninety-Six Thousand Seven Hundred Sixty-Four Dollars ($5,396,764.00) (the “ Ryan Security Interest ”); 2. A security interest to be granted to CMKXTREME, Inc., a Nevada corporation (“ CMKX ”), as provided in a certain Security Agreement of even date herewith, securing a certain Amended and Restated Convertible Promissory Note payable to CMKX in the amount of Two Million Dollars ($2,000,000.00) (the “ CMKX Security Agreement ”). C. The Security Interests granted herein shall be senior in priority to the Permitted Security Interests, as provided in a Subordination Agreement by and between Secured Party, Ryan and CMKX of even date herewith.
NOW, THEREFORE, with reference to the above recitals, and in reliance thereon, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:
1. Creation of Security Interest . Debtor hereby grants to Secured Party a first lien perfected security interest in, and does hereby collaterally assign, pledge, mortgage, convey and set over unto the Secured Party, the Collateral as described in Exhibit A which Exhibit A is incorporated herein by reference, and all of Debtor’s present and hereafter acquired right, title and interest in and to the Collateral, for the purpose of securing payment of all indebtedness, obligations and liabilities of Debtor to Secured Party arising under or in connection with the Note, and all other obligations of Debtor under the Note and all other agreements entered into concurrently therewith (collectively the “ Loan Documents ”) and performance of all agreements,
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covenants, terms and conditions contained in the foregoing documents and instruments (all obligations of Debtor as described in this Section 1 shall be collectively referred to herein as the “ Obligations ”).
2. Warranties, Representations and Covenants of Debtor . Debtor hereby warrants, represents and covenants as follows:
(a) Debtor is and will be the sole owner of the Collateral, free from any lien, security interest, encumbrance or adverse claim of any kind, other than the Permitted Security Interests. Debtor will not permit any financing statement to be filed with respect to the Collateral or any portion thereof, except in favor of Secured Party or pertaining to the Permitted Security Interests. Debtor will notify Secured Party of, and will defend the Collateral against, all claims and demands of all persons at any time claiming the same or any interest therein, other than the Permitted Security Interests.
(b) The Collateral will not be used and was not purchased for personal, family or household purposes.
(c) Debtor authorizes Secured Party to file one or more financing statements identifying the Collateral and evidencing the security interest of Secured Party in the Collateral pursuant to the requirements of the Uniform Commercial Code and in form satisfactory to Secured Party. Debtor will pay cost of filing the same in all public offices wherever filing is deemed by Secured Party to be necessary or desirable.
(d) Without the prior written consent of Secured Party, Debtor will not sell, exchange, dispose of, lease, offer to sell or otherwise transfer or otherwise deal with the Collateral or any portion or interest therein, unless simultaneously therewith new items of Collateral, which items may be similar to those proposed to be disposed of and which shall be of equal or greater value, are substituted therefor. Debtor shall file with the Secured Party a certificate signed by Debtor describing such portion of the Collateral as is being so disposed of and stating that the same has become obsolete, worn out, damaged, destroyed, sold, transferred, or exchanged, and that such portion of the Collateral will be replaced immediately upon the removal thereof. Such certificate likewise shall certify as to the reasonable and equivalent value of the property as acquired or to be acquired in replacement or substitution. All after-acquired property of the Debtor located on the Premises and all additions or replacements acquired pursuant to the provisions of this paragraph shall immediately be and become, without any other act on the part of the Debtor, subject to the security interest and lien of this Security Agreement, which security interest shall be prior to any other security interest or lien on such property. Unless expressly recited or provided to the contrary in this Security Agreement or in the other Loan Documents, Debtor may not hereafter acquire any property to be located on the Premises subject to prior security interests. If the Collateral or any part thereof is sold, transferred, exchanged, or otherwise disposed of, the security interest of Secured Party shall extend to the proceeds of such sale, transfer, exchange or other disposition.
(e) Debtor will pay prior to delinquency all taxes and assessments assessed against the Collateral, imposed on account of its use or operation or imposed upon the Secured Party’s Note (“ Impositions ”) and shall deliver to Secured Party, within ten (10) days after the
within ten (10) days after the
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GEORGE BUSH
Diamond Miner
shorters beware" your shorts are down"...
Posts: 345
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Post by GEORGE BUSH on May 13, 2005 11:55:51 GMT -5
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collateral therefor or any guaranties thereof. Subject to the terms of Paragraph 1 above, all rights, powers and remedies hereunder shall apply to all past, present and future Lender Obligations, including under successive transactions which may continue, renew, increase, decrease or from time to time create new Lender Obligations.
6. Woodward to Receive Payments, etc . in Trust . Except as otherwise expressly agreed to herein, if Woodward shall receive any collections on any accounts or general intangibles or proceeds from the disposition of any Collateral during the “standstill” period set forth in Paragraph 3 of this Agreement, such payment or property shall be received by Woodward in trust for Lender and shall immediately be delivered and transferred to Lender.
7. Financial Condition of Borrower . Woodward represents and warrants to Lender that Woodward is currently informed of the financial condition of Borrower and of all other circumstances which a diligent inquiry would reveal and which bear upon the risk of non-payment of the Lender Obligations. Woodward further represents and warrants to Lender that Woodward has read and understands the terms and conditions of the Lender Agreements. Woodward hereby agrees that any failure on its part to continue to keep informed of Borrower’s financial condition and of all other circumstances which bear upon the risk of non-payment or non-performance of the Lender Obligations shall not constitute a defense to Woodward’s obligations hereunder, and Woodward waives any requirement on the part of Lender to keep Woodward informed of any such circumstances.
8. Assignees, etc . This Agreement shall be binding upon the successors and assigns of Woodward and shall inure to the benefit of Lender’s successors and assigns.
9. Choice of Law . The validity of this Agreement, its construction, interpretation and enforcement, and the rights of the parties hereunder, shall be determined under, governed by and construed in accordance with the laws of the State of Nevada.
10. Collection Costs ; Attorneys’ Fees . In the event it becomes necessary for any party to commence any proceedings or actions to enforce the provisions of this Agreement, the court or body before which the same shall be tried shall award to the prevailing party all costs and expenses thereof including, but not limited to, reasonable attorneys’ fees, the usual and customary and lawfully recoverable court costs and all other expenses in connection therewith.
11. Waiver of Jury Trial . TO THE MAXIMUM EXTENT PERMITTED BY LAW, WOODWARD EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY ACTION, CAUSE OF ACTION, CLAIM, DEMAND OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS AGREEMENT, OR IN ANY WAY CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE DEALINGS OF WOODWARD AND LENDER WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. TO THE MAXIMUM EXTENT PERMITTED BY LAW, WOODWARD HEREBY AGREES THAT ANY SUCH ACTION, CAUSE OF ACTION, CLAIM, DEMAND OR PROCEEDING SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT LENDER MAY FILE AN ORIGINAL COUNTERPART OF THIS SECTION WITH ANY COURT OR OTHER
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TRIBUNAL AS WRITTEN EVIDENCE OF THE CONSENT OF WOODWARD TO THE WAIVER OF HIS RIGHT TO TRIAL BY JURY.
12. Counterparts . This Agreement may be simultaneously executed in several counterparts, each of which shall be the original and all of which shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.
LENDER:
CMKXTREME, Inc.,
a Nevada corporation
By:
Urban Casavant, President
John S. Woodward
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SUBORDINATION AGREEMENT
This SUBORDINATION AGREEMENT (this “ Agreement ”) is made and entered into as of April 11, 2005 by and among URBAN CASAVANT AS THE TRUSTEE OF THE UAJC 2002 IRREVOCABLE TRUST (the “ Trust ”), CMKXTREME, Inc., a Nevada corporation, (“ CMKX ”), KEVIN T. RYAN, an individual (“ Ryan ”), and JOHN S. WOODWARD, an individual (“ Woodward ”).
Preliminary Statements
A. CRYSTALIX GROUP INTERNATIONAL, INC., a Nevada corporation (“ Borrower ”) has entered into a certain Security Agreement of even date herewith (the “ Trust Security Agreement ”) granting to the Trust a security interest in Borrower’s fifty-one percent (51%) membership interest in Laser Design International, LLC, a California limited liability company (the “ Collateral ”) securing a certain Convertible Promissory Note payable to the Trust in the amount of One Million Dollars ($1,000,000.00) (the “ Trust Note ”).
B. Borrower has entered into a certain Security Agreement of even date herewith (the “ CMKX Security Agreement ”) granting to CMKX a security interest in certain property of Borrower described therein, which includes but is not limited to the Collateral, securing a certain Convertible Promissory Note, dated September 23, 2004 in the amount of Two Million Dollars ($2,000,00.00), as amended and restated by a certain Amended and Restated Convertible Promissory Note of even date herewith (the “ CMKX Note ”).
D. Borrower has entered into a certain Security Agreement with Ryan, dated December 23, 2002 (the “ Ryan Security Agreement ”), granting to Ryan a security interest in certain property of Borrower described therein, which includes but is not limited to the Collateral, securing a certain Amended and Restated Convertible Promissory Note payable to Ryan, dated July 21, 2004 in the amount of Five Million Three Hundred Ninety-Six Thousand Seven Hundred Sixty-Four Dollars ($5,396,764.00) (the “ Ryan Note ”).
E. Borrower has entered into a certain security agreement with Woodward, dated December 22, 2002 (the “ Woodward Security Agreement ”), granting to Woodward a security interest in certain property of Borrower described therein, securing a certain Amended and Restated Convertible Promissory Note payable to Woodward, dated July 21, 2004, in the amount of One Million Eight Hundred Twenty-Four Thousand Dollars ($1,824,000.00) (the “ Woodward Note ”).
F. CMKX, Ryan and Woodward desire to subordinate any liens and security interest which they may have in the Collateral to the liens and security interest of the Trust in the Collateral.
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Agreement
NOW, THEREFORE, in consideration of the Trust agreeing to advance to Borrower the loan evidenced by the Trust Note:
1. Definition of Obligations . The term “ Obligations ” is used in this Agreement in its broadest and most comprehensive sense and shall mean all present and future indebtedness of Borrower which may be, from time to time, directly or indirectly, incurred by Borrower, including interest (including any interest which, but for the application of the provisions of the Federal Bankruptcy Code, would have accrued on such amounts), principal, costs and other charges, and all claims, rights, causes of action, judgments, decrees, remedies, security interests or other obligations of any kind whatsoever and howsoever arising, whether voluntary, involuntary, absolute, contingent or by operation of law.
The term “ Trust Obligation ” is used in this Agreement to refer to those Obligations of Borrower owing to the Trust under the Trust Note and limited to a maximum principal amount of One Million Dollars ($1,000,000.00) (plus interest thereon and fees and costs in connection therewith), reduced upon the sale or disposition of any Collateral subject to a Trust Lien (as defined below) by the amount of the net proceeds of such sale or disposition that are received by the Trust.
2. Subordination of Creditor Liens and Security Interests . All liens and security interests presently existing or hereafter obtained by the CMKX, Ryan and Woodward (“ Creditor Liens ”) in any of the Collateral to secure any Obligations now or hereafter owed by Borrower to CMKX, Ryan and Woodward (“ Creditor Obligations ”) are hereby subordinated to any and all liens and security interests now or hereafter obtained by the Trust (“ Trust Liens ”) in the Collateral to secure the Trust Obligations. The priority established by this Agreement shall be binding upon the Trust and CMKX, Ryan and Woodward notwithstanding the time of attachment or perfection of the priority of, or the avoidance of either the Trust Liens or the Creditor Liens.
3. Limitations on CMKX, Ryan and Woodward’s Actions . As long as any of the Trust Obligations remains unpaid, in whole or in part, and as long as the Trust is obligated to make loans and advances to Borrower pursuant to the Trust Note, CMKX, Ryan and Woodward each respectively agrees to provide to the Trust, by Certified Mail, a copy of any notice to Borrower of any default by Borrower in the payment of any of the Creditor Obligations owed to each of them, respectively (a “ Payment Default ”). CMKX, Ryan and Woodward agree that they will not enforce or apply any of the Creditor Liens, notify any of Borrower’s account debtors of the Creditor Liens or attempt to collect on any accounts or general intangibles, or in any other manner interfere with the Trust Liens (collectively, “ Creditor Lien Enforcement ”) prior to the thirtieth (30 th ) day following the Trust’s receipt of notice of a Payment Default or, if prior to such date the Trust shall have commenced to exercise and has continued diligently to pursue its contractual, judicial, equitable or other remedies with respect to the Collateral, then CMKX, Ryan and Woodward agree not to initiate any Creditor Lien Enforcement until such actions by the Trust have been completed or the Trust Obligations have been repaid in full.
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4. CMKX, Ryan and Woodward’s Waivers . CMKX, Ryan and Woodward agree that the Trust shall have absolute power and discretion, without notice to CMKX, Ryan and Woodward, to deal in any manner with the Trust Obligations, the Trust Liens and the Collateral including, but not by way of limitation, release, surrender, extension, renewals, acceleration, compromise or substitution. CMKX, Ryan and Woodward hereby waive and agree not to assert against the Trust any rights which a guarantor or surety could exercise, but nothing in this Agreement shall constitute CMKX, Ryan and Woodward a guarantor or surety. CMKX, Ryan and Woodward hereby waive the right, if any, to require the Trust to marshal or otherwise require the Trust to proceed to dispose of or foreclose upon the Collateral in any manner or order.
5. Continuing Nature of this Agreement . If, at any time hereafter, the Trust shall, in its own judgment, determine to discontinue the extension of credit to or on behalf of Borrower, the Trust may do so (subject to any agreements then existing between the Trust and Borrower). This Agreement, the obligations of CMKX, Ryan and Woodward owing to the Trust and the Trust’s rights and privileges hereunder shall continue in full force and effect and it shall not be cancelled or otherwise rendered ineffective until payment in full of all of the Trust obligations, notwithstanding any action or inaction by the Trust with respect thereto or with respect to any collateral therefor or any guaranties thereof. Subject to the terms of Paragraph 1 above, all rights, powers and remedies hereunder shall apply to all past, present and future Trust Obligations, including under successive transactions which may continue, renew, increase, decrease or from time to time create new Trust Obligations.
6. CMKX, Ryan and Woodward to Receive Payments, etc . in Trust . Except as otherwise expressly agreed to herein, if CMKX, Ryan and Woodward shall receive any collections on any accounts or general intangibles or proceeds from the disposition of any Collateral during the “standstill” period set forth in Paragraph 3 of this Agreement, such payment or property shall be received by CMKX, Ryan and Woodward in trust for the Trust and shall immediately be delivered and transferred to the Trust.
7. Financial Condition of Borrower . CMKX, Ryan and Woodward represent and warrant to the Trust that CMKX, Ryan and Woodward are currently informed of the financial condition of Borrower and of all other circumstances which a diligent inquiry would reveal and which bear upon the risk of non-payment of the Trust Obligations. CMKX, Ryan and Woodward further represent and warrant to the Trust that CMKX, Ryan and Woodward have read and understand the terms and conditions of the Trust Note and the Security Agreement. CMKX, Ryan and Woodward hereby agree that any failure on their part to continue to keep informed of Borrower’s financial condition and of all other circumstances which bear upon the risk of non-payment or non-performance of the Trust Obligations shall not constitute a defense to CMKX, Ryan and Woodward’s obligations hereunder, and CMKX, Ryan and Woodward waive any requirement on the part of the Trust to keep CMKX, Ryan and Woodward informed of any such circumstances.
8. Assignees, etc . This Agreement shall be binding upon the successors and assigns of CMKX, Ryan and Woodward and shall inure to the benefit of the Trust’s successors and assigns.
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9. Choice of Law . The validity of this Agreement, its construction, interpretation and enforcement, and the rights of the parties hereunder, shall be determined under, governed by and construed in accordance with the laws of the State of Nevada.
10. Collection Costs ; Attorneys’ Fees . In the event it becomes necessary for any party to commence any proceedings or actions to enforce the provisions of this Agreement, the court or body before which the same shall be tried shall award to the prevailing party, or parties, all costs and expenses thereof including, but not limited to, reasonable attorneys’ fees, the usual and customary and lawfully recoverable court costs and all other expenses in connection therewith.
11. Waiver of Jury Trial . TO THE MAXIMUM EXTENT PERMITTED BY LAW, CMKX, RYAN AND WOODWARD EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY ACTION, CAUSE OF ACTION, CLAIM, DEMAND OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS AGREEMENT, OR IN ANY WAY CONNECTED WITH, RELATED TO OR INCIDENTAL TO THE DEALINGS OF CMKX, RYAN AND WOODWARD AND THE TRUST WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. TO THE MAXIMUM EXTENT PERMITTED BY LAW, CMKX, RYAN AND WOODWARD HEREBY AGREE THAT ANY SUCH ACTION, CAUSE OF ACTION, CLAIM, DEMAND OR PROCEEDING SHALL BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT THE TRUST MAY FILE AN ORIGINAL COUNTERPART OF THIS SECTION WITH ANY COURT OR OTHER TRIBUNAL AS WRITTEN EVIDENCE OF THE CONSENT OF CMKX, RYAN AND WOODWARD TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
12. Counterparts . This Agreement may be simultaneously executed in several counterparts, each of which shall be the original and all of which shall constitute one instrument.
(signature page follows below)
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.
Urban Casavant as the Trustee of the UAJC 2002 Irrevocable Trust
CMKXTREME, Inc.,
a Nevada corporation
By:
Urban Casavant, President
Kevin T. Ryan
John S. Woodward
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INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT (this “ Agreement ”) is made and entered into as of April 11, 2005, by and between Kevin T. Ryan (“ Ryan ”) and CMKXTREME, Inc., a Nevada corporation (“ CMKX ”).
Preliminary Statements
A. Ryan is a secured creditor of Crystalix Group International, Inc.., a Nevada corporation (“ Debtor ”), and has extended loans and other financial accommodations to Debtor which are secured by security interests in certain personal property assets of Debtor (the “ Collateral ”) as provided in that certain Security Agreement dated December 23, 2002 (the “ Ryan Security Agreement ”).
B. Debtor has issued in favor of CMKX a certain Convertible Promissory Note, in the original principal amount of Two Million Dollars ($2,000,000), dated September 23, 2004 as amended and restated as of April 11, 2005 (the “ CMKX Note ”). In order to secure the obligations of Debtor owing to CMKX under the CMKX Note, Debtor has executed that certain Security Agreement in favor of CMKX dated April 11, 2005 (the “ CMKX Security Agreement ).
Agreement
NOW, THEREFORE, in consideration of CMKX agreeing to amend and restate the CMKX Note, CMKX and Ryan agree as follows.
1. Definition of Obligations . The term “ Obligations ” is used in this Agreement in its broadest and most comprehensive sense and shall mean all present and future indebtedness of Debtor which may be, from time to time, directly or indirectly, incurred by Debtor, including interest (including any interest which, but for the application of the provisions of the Federal Bankruptcy Code, would have accrued on such amounts), principal, costs and other charges, and all claims, rights, causes of action, judgments, decrees, remedies, security interests or other obligations of any kind whatsoever and howsoever arising, whether voluntary, involuntary, absolute, contingent or by operation of law.
2. Equal Priority of CMKX Liens and Security Interests . All liens and security interests presently existing or hereafter obtained by CMKX in any of the Collateral to secure any Obligations now or hereafter owed by Debtor to CMKX (“ CMKX Liens ”) shall have equal priority with any and all liens and security interests now or hereafter obtained by Ryan in the Collateral to secure any Obligations now or hereafter owed by Debtor to Ryan (“ Ryan Liens ”). The equal priority established by this Agreement shall be binding upon Ryan and CMKX notwithstanding the time of attachment or perfection of or the avoidance of either the Ryan Liens or the CMKX Liens.
3. CMKX’s Waivers . CMKX agrees that Ryan shall have absolute power and discretion, without notice to CMKX, to deal in any manner with the Obligations of Debtor to Ryan, the Ryan Liens, and the Collateral, including, but not limited to enforcement of the Ryan
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Liens as provided in the Ryan Security Agreement and applicable law, or the release, surrender, extension, renewals, acceleration, compromise or substitution of the Ryan Liens or the Obligations secured thereby. CMKX hereby waives the right, if any, to require Ryan to marshal or otherwise require Ryan to proceed to dispose of or foreclose upon the Collateral in any manner or order.
4. Ryan’s Waivers . Ryan agrees that CMKX shall have absolute power and discretion, without notice to Ryan, to deal in any manner with the Obligations of Debtor to CMKX, the CMKX Liens, and the Collateral, including, but not limited to enforcement of the CMKX Liens as provided in the CMKX Security Agreement and applicable law or the release, surrender, extension, renewals, acceleration, compromise or substitution of the CMKX Liens or the Obligations secured thereby. Ryan hereby waives the right, if any, to require CMKX to marshal or otherwise require CMKX to proceed to dispose of or foreclose upon the Collateral in any manner or order.
5. Ryan’s Realization Upon Collateral. If Ryan at any time realizes cash proceeds resulting from the enforcement of the Ryan Liens against the Collateral, Ryan shall promptly deliver to CMKX a portion of such proceeds, equal to the amount of such proceeds multiplied by a fraction as follows: (a) the numerator of the fraction shall be the total amount of the Obligations owed by Debtor to CMKX secured by the CMKX Liens immediately prior to such enforcement action, and (b) the denominator of the fraction shall be the sum of the amounts of all Obligations owed by Debtor to Ryan and CMKX, secured by either the Ryan Liens or the CMKX Liens, immediately prior to such enforcement action.
6. CMKX Realization Upon Collateral. If CMKX at any time realizes cash proceeds resulting from the enforcement of the CMKX Liens against the Collateral, CMKX shall promptly deliver to Ryan a portion of such proceeds, equal to the amount of such proceeds multiplied by a fraction as follows: (a) the numerator of the fraction shall be the total amount of the Obligations owed by Debtor to Ryan secured by the Ryan Liens immediately prior to such enforcement action, and (b) the denominator of the fraction shall be the sum of the amounts of all Obligations owed by Debtor to Ryan and CMKX, secured by either the Ryan Liens or the CMKX Liens, immediately prior to such enforcement action.
7. Choice of Law . The validity of this Agreement, its construction, interpretation and enforcement, and the rights of the parties hereunder, shall be determined under, governed by and construed in accordance with the laws of the State of Nevada.
8. Collection Costs ; Attorneys’ Fees . In the event it becomes necessary for any party to commence any proceedings or actions to enforce the provisions of this Agreement, the court or body before which the same shall be tried shall award to the prevailing party all costs and expenses thereof including, but not limited to, reasonable attorneys’ fees, the usual and customary and lawfully recoverable court costs and all other expenses in connection therewith.
9. Assignees, etc . This Agreement shall be binding upon and shall inure to the benefit of the successors and assigns of CMKX and Ryan.
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10. Counterparts . This Agreement may be simultaneously executed in several counterparts, each of which shall be the original and all of which shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.
___________________________________
Kevin T. Ryan CMKXTREME, Inc.,
a Nevada corporation
By: _________________________________
Urban Casavant, President
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AMENDMENT TO REGISTRATION RIGHTS AGREEMENT
THIS AMENDMENT TO REGISTRATION RIGHTS AGREEMENT (this “Amendment”), dated as of April 11, 2005, is by and between Crystalix Group International, Inc., a Nevada corporation (the “Company”), and CMKXTREME, Inc., a Nevada corporation (“CMKX”), also known as CMKXTREME.com.
FACTUAL BACKGROUND
A. The Company and CMKX entered into a certain Registration Rights Agreement dated as of September 23, 2004 (the “Agreement”). The Company and CMKX desire to amend the Agreement as set forth below.
AMENDMENT
Section 1(e) of the Agreement is amended to read in full as follows:
“ (e) “Registrable Shares” means, at any time, (i) the Common Stock to be issued pursuant to conversion of the Loan or any part thereof, excluding interest accruing after the filing date of the related application for registration, and (ii) shares of Common Stock to be issued upon exercise of the Warrants; provided , however, that Registrable Shares shall not include any shares of Common Stock the sale of which has been registered and consummated pursuant to the Securities Act or which have been sold pursuant to Rule 144.”
Except as expressly amended herein, the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the day and year first above written.
CMKXTREME, Inc.,
a Nevada corporation
By:
Urban Casavant, President Crystalix Group International, Inc.
By:
Doug Lee, President
By:
Patty Hill, Secretary
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Post by Designer on May 13, 2005 13:36:26 GMT -5
Its long read but gotta read it -- hmmmm
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