FUNDING AGREEMENT
AGREEMENT, made as of December 16, 1999, by and between XXXXXXX.XXX, INC.
("SYCD"), a Delaware corporation having its principal offices at 0000X Xxxxxxx
Xxxxx, Xxxxxxxx Xxxx, Xxxxxxxx 00000, and ALLIANCE EQUITIES, INC., a Florida
corporation having its principal offices at 00000 X.X. 0xx Xxxxx, Xxxxx Xxxxxxx,
Xxxxxxx 00000, ("Alliance").
WHEREAS, SYCD is desirous of receiving short term financing, and Alliance
is willing and able to provide such financing, on the terms and conditions set
forth below:
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto agree as follows:
1. Financing Commitment. Alliance agrees to provide to SYCD an aggregate of
$2,000,000.00 in loans (the "Loans"), each loan to be an unsecured SYCD
obligation bearing interest at an annual rate of 12% per annum and repayable by
SYCD by SYCD issuing to Alliance that number of shares of SYCD common stock (the
"Shares") registered under the Securities Act of 1933, as amended (the
"Securities Act"), equal to principal plus interest accrued to the payment date,
each share to be valued at the lower of $0.98 or the average of the closing bid
price of SYCD's common stock as reported on YAHOO for the 20 days prior to the
declaration by the Securities
and Exchange Commission of the effectiveness of the SYCD Registration Statement
on Form SB-2 (the "SB-2") registering under the Securities Act the Shares and
the 600,000 warrants described in Section 3 below.
2. Loan Schedule. Alliance shall make the Loans to SYCD by making a loan to
SYCD of $500,000.00 principal amount on each of the following four dates:
a. the date on which SYCD files with the SEC a Registration
Statement on Form 10;
b. the date on which the SEC declares effective SYCD's SB-2;
C. 60 days following the effectiveness of the SB-2; and
d. 120 days following the effectiveness of the SB-2.
3. Inducement Fee. SYCD agrees that upon the closing of the initial
$500,000.00 Loan (a) SYCD will issue to Alliance warrants (the "Warrants")
entitling Alliance to purchase 600,000 shares of SYCD common stock of a price of
$.01 per share for five years, and (b) SYCD will pay to Alliance in cash a Loan
administration fee of $30,000.00. SYCD agrees to register under the Securities
Act and include in the SB-2 the shares of SYCD common stock issuable upon
exercise of the Warrants.
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4. Amendment; Breach and Waiver. This Agreement may not be amended or
modified in any manner, except by an instrument in writing signed by both
parties hereto. The failure of either party hereto to enforce at any time any of
the provisions of this Agreement shall in no way be construed to be a waiver of
any such provision or any other provision, or of the right of such party
thereafter to enforce each and every such provision or other provision in the
event of a subsequent breach.
5. Agreement Binding Upon Successors. This Agreement shall inure to the
benefit of and shall be binding upon SYCD, its successors and assigns, and upon
Alliance and its successors and assigns.
6. Counterparts. This Agreement may be executed in several counterparts,
each of which shall be deemed an original but both of which together shall
constitute one and the same instrument.
7. Choice of Law and Forum. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, exclusive of its
choice-of-law principles. Each party hereby irrevocably submits to the
jurisdiction of any state or Federal court sitting in New York County, New York
in any action or proceeding arising out of or relating to this Agreement, and
each party hereby irrevocably waives the defenses of improper venue or
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an inconvenient forum for the maintenance of any such action or proceeding to
the fullest extent permitted by law.
8. Section Headings. Section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
9. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof, and there
are no agreements, undertakings, restrictions, warranties, promises or
representations between the parties with respect to the subject matter hereof
other than those set forth herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
XXXXXXX.XXX, INC.
By: /s/ Sy Xxxxxx Xxxxx
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Sy Xxxxxx Xxxxx, Chairman
ALLIANCE EQUITIES, INC.
By: /s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
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(Print Name)
President
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(Title)
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