BRIDGE LOAN AGREEMENT
This Bridge Loan Agreement (the "Note"), is made and effective as of this
10th day of May, 2004 ("Effective Date"), by and between Baywood International,
Inc., a Nevada Corporation ("Company"), having an address at 00000 Xxxxx 00xx
Xxxxx, Xxxxx 0, Xxxxxxxxxx, XX 00000 and X. X. Xxxxx, Inc., a New York
Corporation, ("Lender"), having an address at 000 Xxxxxx Xxxx Xxxx, Xxxxxxx
Xxxxx, XX 00000. Company and Lender may be referred to hereinafter
individually as "Party" or collectively as "Parties".
RECITALS
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WHEREAS, the Lender and the Company desire to enter into this Note to
facilitate Company's payment under a certain Letter of Intent dated May 18, 2004
("LOI"), as attached;
NOW, THEREFORE, in consideration received, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree as follows:
AGREEMENT
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1. Amount. Company promises to pay to Lender the principal sum of
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Three Hundred Seventy-Five Thousand and 00/100 U.S. Dollars (U.S.$375,000), with
interest on the outstanding unpaid principal balance as hereinafter set forth.
Company's execution of this Note shall evidence Company's receipt on the date
hereinabove set forth of funds in the foregoing amount.
2. Maturity. The maturity date ("Maturity Date") of this Note shall be
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one (1) year from the date of receipt of funds from the Lender, or May 10, 2005.
3. Interest. In addition to the principal sum in this Note, Company
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promises to pay Lender basic interest. The basic interest rate (the "Contract
Rate") shall be ten percent (10%) per annum, or .83% per month, on outstanding
principal balance. The entire principal balance and accrued interest is due on
or before Maturity Date. If prepaid early, all interest accrued to prepayment
date shall be due and payable to Lender. Should it be necessary to calculate
interest for a partial month, such amount shall be calculated by dividing a full
month's interest by the total number of days in that particular month and then
multiplying the resulting daily interest amount by the number of days in that
particular month that interest has accrued.
4. Equity Kicker. As additional interest to Lender under this Note,
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Company agrees to issue and Lender agrees to accept a warrant for One Million
Seven Hundred Twenty-Five Thousand (1,725,000) common shares of the Company (the
"Warrants") at an exercise price of $0.04. Such Warrant is attached to this
Note as Exhibit A.
5. Payment. The entire unpaid balance of principal owing on this Note
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and accrued and unpaid interest thereon shall be due and payable in full on
Maturity Date.
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6. Manner and Place of Payments. Unless notified otherwise, Company
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shall make all payments due under this Note to Lender to the following address:
X. X. Xxxxx, Inc.
000 Xxxxxx Xxxx Xxxx
Xxxxxxx Xxxxx, XX 00000
7. U.S. Dollars. All payments shall be in U.S. Dollars and be made via
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check drawn on a U.S. bank.
8. Prepayment Privilege. Company shall have the privilege to prepay
---------------------
and, conditioned as hereinafter set forth, Lender shall have an obligation to
accept tendered prepayments of all of the principal balance of this Note
together with the accrued interest to the Maturity Date of the Note.
Furthermore, if Company successfully completes an equity financing of $2,000,000
or more before the Maturity Date, the parties agree that Lender shall have the
right to accelerate the Maturity Date to the closing date of any such equity
financing.
9. Lender's Rights Cumulative. The rights and remedies of Lender as
----------------------------
provided in this Note and/or under applicable law shall be cumulative and
concurrent, and may be pursued singly, successively, or together against Company
and any other funds for the payment hereof or otherwise at the sole, absolute
and unfettered discretion of Lender, subject to any limitations imposed by
applicable law. The failure to exercise any such right or remedy shall in no
event be construed as a waiver or release of said rights or remedies or of the
right to exercise them at any later time.
10. Consents and Waiver of Defenses. Except as otherwise provided
-----------------------------------
herein, Company, endorsers, guarantors, sureties, accommodation parties,
assuming parties hereof, and all other persons liable or to become liable for
all or any part of this indebtedness, jointly and severally waive all applicable
exemption rights, whether under the state constitution, homestead laws or
otherwise, and also jointly and severally waive diligence, presentment, protest
and demand, and also notice of protest, of demand, of nonpayment, of dishonor
and of maturity and also recourse to suretyship defenses generally, marshaling
of assets, laches, estoppels and equitable defenses generally; and they also
jointly and severally hereby consent to any and all renewals, extensions or
modifications of the terms hereof, including time of payment, and further agree
that any such renewal, extension or modification of the terms hereof, or the
release or substitution of any security for the indebtedness evidenced hereby or
any other indulgences agreed upon by Company shall not affect the liability of
any of said parties for the indebtedness evidenced by this Note. Any such
medications agreed upon by Company and Lender may be made without notice to any
said parties. All said parties hereby specifically consent to any future action
whereby with Company's and Lender's consent:
(a) This Note may from time-to-time be extended or renewed
or its terms (including the terms of payment of principal or interest
or both or any part thereof) otherwise modified;
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(b) Any of the provisions of this Note may be amended or any
requirement hereof or default hereunder waived or any departure there
from consented to or any other forbearance or indulgence exercised with
respect hereto; and
(c) Any collateral now or hereafter securing this Note may be
exchanged, substituted, realized upon, released, extended or otherwise
dealt with or disposed of.
11. Fees and Expenses. Company, indemnitors, endorsers, guarantors,
-------------------
sureties, accommodation parties, assuming parties hereof and all persons liable
or to become liable on this Note, agree jointly and severally, to pay or
reimburse Lender for, as the case may be, all costs of collection, including
reasonable attorneys' fees as determined by the judge of the court and all costs
of suit, in the event that the unpaid principal sum of this Note, or any payment
of interest or principal and interest thereon, late charge or premium, is not
paid when due, or in the event that it becomes necessary to protect any security
for the indebtedness evidenced hereby, or for the foreclosure or other
enforcement by Lender or on behalf of Lender of any lien or document providing
such security, or in the event that Lender is made party to any litigation
because of the existence of the indebtedness evidenced by this Note, or because
of the existence of any security, whether suit be brought or not, and whether
through courts of original jurisdiction, as well as courts of appellate
jurisdiction, or through a Bankruptcy Court or other legal proceedings.
12. Amendment and Modification. This Note may not be amended, modified
--------------------------
or changed, nor shall any waiver of any provision hereof be effective, except
only by an instrument in writing and signed by the party against whom
enforcement of any waiver, amendment, change, modification or discharge is
sought; provided, however, that this paragraph shall in no way be a limitation
on the provisions of the consents and waivers set forth in Paragraph 8 hereof.
13. Interest Not to Exceed Legal Maximum. Notwithstanding any
-----------------------------------------
provision herein or in any instrument now or hereafter securing this Note, the
total liability for payments in the nature of interest shall not exceed the
limits imposed by the usury laws of the State of Arizona. If Lender receives as
interest an amount which would exceed such limits, such amount which would be
excessive interest shall be applied to the reduction of the unpaid principal
balance and not to the payment of interest; and if a surplus remains after full
payment of principal and lawful interest, the surplus shall be remitted to
Company by Lender, and Company hereby agrees to accept such remittance. If the
preceding sentence becomes operative, the total unpaid principal balance of this
Note, if any, shall bear interest at the maximum rate then permitted by the
usury laws of the State of Arizona until all the then obligations of this Note,
as modified by this paragraph, are paid and performed in full.
14. Additional Sums. All fees (including origination fees), points,
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charges, goods, things in action or any other sums or things of value
(collectively, the "Additional Sums") paid by Company to Lender, whether
pursuant to this Note or otherwise howsoever with respect to the indebtedness
evidenced hereby, or with respect to any other document or agreement securing
this Note, which, under the law of the State of Arizona, are deemed to be
interest with respect to this Note or such indebtedness, shall, for the purpose
of any laws of the State of Arizona which may limit the maximum rate of interest
to be charged with respect to this Note or such indebtedness,
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be payable by Company as, and shall be deemed to be, additional interest, and
for such purposes only, the agreed upon and contracted rate of interest
described above shall be deemed to be increased by the Additional Sums.
15. Successors and Assigns. Whenever used herein, the words "Company"
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and "Lender" shall be deemed to include their respective heirs, personal
representatives, successors and assigns. This paragraph shall not be construed
as Lender's consent to Company's assignment or transfer of any property securing
payment hereof or any rights, powers, obligations or duties of Company.
16. Governing Law. Except where preempted by the laws of the United
--------------
States, or regulations promulgated there under, this Note shall be interpreted
and construed in accordance with and be governed by the substantive laws of the
State of Arizona.
17. Notices. All notices or other communications required or permitted
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to be given or delivered under this Note shall be in writing and shall be
delivered (a) by hand in exchange for a receipt, or (b) by certified or
registered mail, return receipt requested, postage prepaid, and addressed or
delivered to the respective addresses as herein provided.
18. Attorneys Fees. Notwithstanding any provision hereof to the
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contrary, if any dispute arising under the terms of this Note shall result in
litigation, the prevailing party shall, in addition to any other relief to which
it is entitled, be entitled to an award of its reasonable attorneys' fees as
determined by the court, together with an award of all of its costs of
litigation.
19. Controlling Agreement. This Note embodies the entire agreement and
---------------------
understanding between the Company and Lender with respect to the repayment of
the indebtedness evidenced hereby. In the event of a conflict between the terms
of this Note and the terms of any other documents, the terms of this Note shall
control.
20. Severability. If any provision of this Note or the application
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thereof to any person or circumstances shall be held invalid or unenforceable by
any court or other governmental authority to any extent, the remainder of this
Note and the application of such provisions to other persons or circumstances
shall not be affected thereby and shall remain enforceable.
DATED as of the day first hereinabove set forth
"COMPANY" "LENDER"
BAYWOOD INTERNATIONAL, INC. X. X. XXXXX, INC.
A Nevada Corporation A New York Corporation
By: /s/ Xxxx Xxxxxxxxxx By: /s/ X.X. Xxxxx
------------------- --------------
Its: President & C.E.O. Its: President
----------------- ---------
Date: May 18, 2004 Date: June 1, 2004
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EXHIBIT A
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THE SECURITIES REPRESENTED BY THIS WARRANT HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE
STATE SECURITIES LAW. THESE SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM UNDER SAID ACT. ADDITIONALLY, THE
TRANSFER OF THESE SECURITIES IS SUBJECT TO THE CONDITIONS
SPECIFIED IN THAT CERTAIN BRIDGE LOAN AGREEMENT ATTACHED
HERETO (INDIVIDUALLY AND COLLECTIVELY REFERRED TO HEREIN AS
THE "NOTE"), EXECUTED BY BAYWOOD INTERNATIONAL, INC., A
NEVADA CORPORATION (THE "COMPANY"), AS MAKER, IN FAVOR OF
THE LENDER (AS THE SAME MAY BE AMENDED AND RESTATED FROM
TIME TO TIME). NO TRANSFER OF THESE SECURITIES WILL BE VALID
OR EFFECTIVE UNTIL THE CONDITIONS OF THE NOTE AND THE TERMS
OF THIS WARRANT HAVE BEEN FULFILLED. COPIES OF THE NOTE MAY
BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER
OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE
COMPANY.
BAYWOOD INTERNATIONAL, INC.
COMMON STOCK PURCHASE WARRANT
No. W - 027 Issuance Date: May 18, 2004
1. Warrant
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1.1 Grant of Warrant. Baywood International, Inc., a Nevada
-----------------
corporation (the "Company"), hereby certifies that, for good and valuable
consideration, the receipt of which is hereby acknowledged, the purchaser of
this Warrant, X.X. Xxxxx, Inc. ("Holder"), is entitled, subject to the terms set
forth below and the terms and conditions of the Note attached hereto executed by
the Company in favor of the Holder, to purchase at the Exercise Price (as
defined in Section 1.2), from the Company at any time or from time to time
during the Exercise Period (as defined in Section 9), One Million Seven Hundred
Twenty-Five Thousand (1,725,000) unregistered shares of the Company's fully paid
and non-assessable common stock, par value $0.001 per share (the "Common
Stock"). Holder acknowledges that the number of common shares described in the
preceding sentence is the total of all common shares that the Holder is entitled
to acquire under the Note attached hereto.
1.2 Exercise Price. Holder shall pay a per share purchase
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price of $0.04 for each share of the Company's Common Stock purchased under this
Warrant (such price per share is referred to herein as the "Exercise Price").
1.3 Adjustments for Issuance of Common Stock and Amount of
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Outstanding Common Stock. If there shall occur any stock split, stock dividend,
------------------------
reverse stock split, or other subdivision of the Company's Common Stock ("Stock
Event"), for which the Company receives no new value, then the number of shares
of Common Stock to be received by the Holder of this Warrant shall be
appropriately adjusted (upward or downward) so that the proportion of (a) the
number of shares issuable
hereunder, plus the number of shares of Warrant Stock (as defined below) held by
the Holder of this Warrant, to (b) the total number of shares of the Company (on
a fully diluted basis) prior to such Stock Event is equal to the proportion of
(x) the number of shares issuable hereunder, plus the number of shares of
Warrant Stock held by the Holder of this Warrant after such Stock Event to (y)
the total number of shares of the Company (on a fully diluted basis) after such
Stock Event. No adjustment to the Exercise Price shall be made in connection
with any adjustment of the number of shares of Common Stock receivable upon
exercise of this Warrant, except that the Exercise Price shall be proportionally
decreased or increased upon the occurrence of any stock split, stock dividend,
reverse stock split or other subdivision of the Common Stock so that the
aggregate Exercise Price payable if the Warrant was exercised in full shall be
the same both before and after the Stock Event; provided, however, that in no
event will the Exercise Price be less than the par value of the Common Stock.
The provisions of this Section 1.3 shall not apply if the Company issues its
Common Stock or other securities for new consideration or if it repurchases its
own shares. For purposes of this Section 1.3, "Warrant Stock" means shares of
Common Stock issued to the Holder upon the partial exercise of this Warrant.
2. Exercise of Warrant.
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2.1 Exercise. This Warrant may be exercised, prior to its
--------
expiration pursuant to Section 2.3, by the Holder hereof at any time or from
time to time during the Exercise Period (as defined in Section 9), by surrender
of this Warrant, with the form of subscription at the end hereof duly executed
by such holder, to the Company at its principal office, accompanied by payment,
by certified or official bank check payable to the order of the Company or by
wire transfer to its account, in the amount obtained by multiplying the number
of shares of Common Stock for which this Warrant is then being exercised by the
Exercise Price. In the event the Warrant is not exercised in full, the Company,
at its expense, will forthwith issue and deliver to, or upon the order of, the
Holder hereof a new Warrant or Warrants of like tenor, in the name of the holder
hereof or as such Holder (upon payment by such Holder of any applicable transfer
taxes) may request, having in the aggregate in Section 1.1 thereof the number of
shares of Common Stock equal (subject to any adjustment provided for herein) to
the number of such shares called for in Section 1.1 of this Warrant minus the
number of such shares (subject to any adjustment provided for herein) for which
this Warrant shall have been exercised. Upon exercise of this Warrant in
accordance with this Section 2.1, the Holder shall be, and shall be deemed to
be, for all purposes, a holder of record of the number of shares of Common Stock
for which this Warrant has been exercised, notwithstanding any delay or failure
of the Company to issue stock certificates as provided in Section 3 hereof.
Immediately upon exercise, the Holder shall have the right to vote on all
matters on which holders of Common Stock have a right to vote, shall be deemed a
record holder for the purposes of voting, dividends or any other distributions,
and shall have all other rights of a stockholder of record under the laws of the
State of Nevada. Upon any exercise of this Warrant, in whole or in part, the
Holder shall pay the aggregate Exercise Price with respect to the shares of
Common Stock for which this Warrant is then being exercised (collectively, the
"Exercise Shares") by payment of cash in the form referred to in the first
sentence of this Section 2.1.
2.2 Class of Stock Receivable Upon Exercise. If at the time
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of exercise the Company has more than one class of Common Stock outstanding, the
shares of Common Stock receivable upon exercise of this Warrant shall be the
shares of Common Stock designated herein upon such exercise by the Holder. If
at any time the Common Stock to which this Warrant is applicable is converted
into any other class of stock ("Other Securities"), this Warrant shall continue
in force and effect and shall be applicable with respect to such Other
Securities.
2.3 Termination. This Warrant shall terminate upon the
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earlier to occur of (a) the exercise in full, or (b) at 5:00 p.m. (Phoenix Time)
on May 18, 2009.
3. Delivery of Stock Certificates on Exercise.
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3.1 Delivery. As soon as practicable after the exercise of
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this Warrant in full or in part, and in any event within seven business days
thereafter, the Company, at its expense (including the payment by it of any
applicable issue taxes), will cause to be issued in the name of and delivered to
the Holder hereof, or as such Holder (upon payment by such holder of any
applicable transfer taxes) may direct, a certificate or certificates for the
number of fully paid and non-assessable shares of Common Stock (or Other
Securities (as defined in Section 2.2)) to which such Holder shall be entitled
on such exercise, together with any other stock or other securities and property
(including cash, where applicable) to which such holder is entitled upon such
exercise.
3.2 Legend. The Company may cause the following legend to be
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set forth on each certificate representing shares of Common Stock acquired under
this Warrant or any other security issued or issuable upon the exercise of this
Warrant, unless counsel for the Company is of the opinion as to any such
certificate that such legend is unnecessary:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "ACT") OR APPLICABLE STATE LAW AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS REGISTERED UNDER THE ACT
AND STATE LAW, OR, UNLESS IN THE OPINION OF COUNSEL, IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER OF THE SECURITIES, SUCH OFFER, SALE, OR TRANSFER,
PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.
3.3 Fractional Shares. In the event that the exercise of
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this Warrant, in whole or in part, results in the issuance of any fractional
share of Common Stock, then in such event the Holder shall be entitled to cash
equal to the fair market value of such fractional share as determined in good
faith by the Company's Board of Directors.
4. Continuation of Terms. Upon any reorganization, consolidation,
---------------------
merger or transfer (and any dissolution following any transfer) of the Company,
this Warrant shall continue in full force and effect and the terms hereof shall
be applicable to the shares of stock and other securities and property
receivable on the exercise of this Warrant after the consummation of such
reorganization, consolidation or merger, or the effective date of dissolution
following any such transfer, as the case may be, and shall be binding upon the
issuer of any stock or other securities, including, in the case of any such
transfer, the person acquiring all or substantially all of the properties or
assets of the Company, whether or not such person shall have expressly assumed
the terms of this Warrant.
5. No Impairment; No Preemptive Rights. The Company will not, by
------------------------------------
amendment of its Articles of Incorporation (or similar documents) or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of the Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the holder of the Warrant. Nothing in this Warrant shall grant
(or be construed to grant) Holder any preemptive or other preferential rights
with respect to the issuance of any class of the Company debt or equity
securities.
6. Notices. In the event of:
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(a) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
transfer of all or substantially all the assets of the Company to or any
consolidation or merger of the Company with or into any other Person; or
(b) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
then, and in each such event, the Company will mail or cause to be mailed to the
holder of this Warrant a notice specifying the date on which any such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up is anticipated to take place, and
the time, if any is to be fixed, as of which the holders of record of Common
Stock (or Other Securities) shall be entitled to exchange their shares of Common
Stock (or Other Securities) for securities or other property deliverable on such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up. Such notice shall be mailed at
least 15 days prior to the date specified in such notice on which any such
record or other action is to be taken.
7. Reservation of Stock Issuable on Exercise of Warrant. The
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Company will at all times reserve and keep available, solely for issuance and
delivery on the exercise of this Warrant, a number of shares of Common Stock
equal to the total number of shares of Common Stock from time to time issuable
upon exercise of this Warrant, and, from time to time, will take all steps
necessary to amend its Articles of Incorporation to provide sufficient reserves
of shares of Common Stock issuable upon exercise of this Warrant, which is not
reflected on its corporate register and which is not in compliance with federal
and state securities laws.
8. Registered Form. This Warrant shall be in registered form only
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in accordance with the Note. The Company shall treat the person reflected on
its corporate register as the Holder of the Warrant. The Company shall not be
obligated to recognize any transfer of this Warrant which is not reflected in
its corporate register and which is not in compliance with federal and state
securities laws.
9. Definitions. As used herein the following terms, unless the
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context otherwise requires, have the following respective meanings:
(a) The term "Common Stock" includes (i) the Company's Common
Stock, par value $0.001 per share (the "Common Stock"), (ii) any other capital
stock of any class or classes (however designated) of the Company, the holders
of which shall have the right, without limitation as to amount, either to all or
to a share of the balance of current dividends and liquidating dividends after
the payment of dividends and distributions on any shares entitled to preference,
and (iii) any other securities into which or for which any of the securities
described in clauses (i) or (ii) above have been converted or exchanged pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise.
(b) The term "Exercise Period" shall mean the period
beginning on the date of issuance and ending at 5:00 p.m. on May 18, 2009.
(c) The term "Warrant Stock" means shares of Common Stock
issued to the holder upon the exercise of this Warrant.
(d) The term "Other Securities" shall have the meaning stated
in Section 2.2.
10. Warrant Agent. The Company may, by written notice to the
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holder of this Warrant, appoint an agent having an office in Phoenix, Arizona
for the purpose of issuing Common Stock
on the exercise of this Warrant pursuant to Section 2 hereof, or any of the
foregoing, and thereafter any such issuance, exchange or replacement, as the
case may be, shall be made at such office by such agent.
11. Promissory Note. This Warrant is issued pursuant to the terms
---------------
and conditions of the aforementioned Note and shall be subject to all terms and
conditions thereof pertaining to the Company's issuance of Warrants.
12. Accredited Investor. The Holder of this Warrant is an
--------------------
"Accredited Investor" as such term is defined in the Securities Act of 1933 and
any regulation issued thereunder. By accepting this Warrant, the Holder
represents and warrants to the Company that he is an Accredited Investor, as
defined above.
13. Remedies. The Company stipulates that the remedies at law of
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the holder of this Warrant in the event of any default or threatened default by
the Company in the performance of or compliance with any of the terms of this
Warrant are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.
14. Benefit. This Warrant shall be binding upon, and inure solely
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to the benefit of the Company and Holder and no other person shall acquire or
have any right under or by virtue of this Warrant.
15. Registration Rights. Subject to the limitations of this
--------------------
Section, the Company agrees to register shares of Warrant Stock, upon the
request of Holder, if the Company files a registration statement under the
Securities Act of 1933 ("the Act"), which relates to a current offering of the
Company's Common Stock (except a registration statement filed in connection with
an offering of the Company's equity securities to its employees pursuant to any
employee benefit or stock option plan or any dividend reinvestment plan
maintained or pursuant to a merger agreement or agreement to acquire the assets
of another entity or similar transaction) so as to permit the public sale of the
Warrant Stock by the Holder in compliance with the Act. The Company shall give
written notice (the "Registration Notice") to Holder of its intention to file a
registration statement under the Act relating to an offering of its Common Stock
not less than sixty (60) days prior to the filing of such registration statement
with the Securities and Exchange Commission ("SEC"). The Holder may request
that the Company include all or a portion of his Warrant Stock in such
registration statement, only if such request is made not later than thirty (30)
days prior to the date specified in the Registration Notice as the date on which
the Company intends to file its registration statement with the SEC. Neither
the Company's delivery of the Registration Notice nor the delivery of a request
by Holder for registration of Warrant Stock shall obligate the Company to file a
registration statement and, notwithstanding the filing of a registration
statement, the Company may at any time prior to the effective date determine not
to offer the securities described in the registration statement, and may
withdraw the registration statement without liability to any Holder of Warrant
Stock. In that event, the Company shall pay all expenses of the registration
statement incurred through the date it is withdrawn. The Company shall pay the
entire cost of any Registration Statement covering Warrant Stock, including,
without limitation, attorneys' fees, accounting fees, filing fees and printing
costs, but excluding any underwriter's discount. The Holder shall be solely
responsible for any underwriter discount on Warrant Stock sold by the Holder.
Any Warrant Stock included in a registration statement filed by the Company
shall be subject to underwriter cutbacks and any other limitations an
underwriter, in its discretion, may impose on the inclusion of such Warrant
Stock in the registration statement.
16. Notices. All notices and other communications from the
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Company to the holder of this Warrant shall be mailed by first class registered
or certified mail, postage prepaid, or sent by overnight courier (or sent in the
form of a telecopy) at the following addresses:
If to Company: Baywood International, Inc.
00000 Xxxxx 00xx Xxxxx, Xxxxx 0
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xx. Xxxx Xxxxxxxxxx, President
Facsimile: (000)000-0000
If to Holder: X.X. Xxxxx, Inc.
Attn: Mr. O. Xxx Xxxxx, III
000 Xxxxxx Xxxx Xxxx
Xxxxxxx Xxxxx, XX 00000
17. Severability. In case any provision of this Warrant shall be
------------
invalid, illegal or unenforceable, or partially invalid, illegal or
unenforceable, the provision shall be enforced to the extent, if any, that it
may legally be enforced and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
18. Integration. This Warrant and any term hereof may be changed,
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waived, discharged or terminated only by a statement in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. The parties waive any common law right to orally modify this
Warrant.
19. Choice of Law. This Warrant shall be governed by and
---------------
construed in accordance with the domestic substantive laws (and not the conflict
of law rules) of the State of Nevada.
20. Headings. The headings in this Warrant are for purposes of
--------
reference only, and shall not limit or otherwise affect any of the terms hereof.
IN WITNESS WHEREOF, the Company has caused this Common Stock Purchase
Warrant to be executed by its duly authorized officer and attested by
its Secretary.
Dated as of May 18, 2004
Baywood International, Inc., a Nevada corporation
By: /s/ Xxxx Xxxxxxxxxx
-------------------
Xxxx Xxxxxxxxxx
President
Attest:
/s/ Xxxx X. Xxxxxxx
-------------------
Secretary
