cellynx_ex1011.htm


    EXHIBIT 10.11


     

    THIS
NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED.

     

    CELLYNX,
INC.

     

    CONVERTIBLE
PROMISSORY NOTE

    
    

     

    
      	$20,000.00 	
              Issue Date: March 27
      2007

            
	 	
              Laguna Niguel,
      California

            


    

     

    FOR VALUE
RECEIVED, Cellynx, Inc., a California corporation (the "Company") promises
to pay to Daniel Ash ("Investor"), or
its registered assigns, in lawful money of the United States of America, the
principal sum of $20,000.00, or such lesser amount as shall equal the
outstanding principal amount hereof, together with interest from the date of
this Convertible Promissory Note ("Note") on
the unpaid principal balance at a rate equal to 4.00% per annum, computed on the
basis of the actual number of days elapsed and a year of 365 days. All unpaid
principal, together with any then unpaid and accrued interest and any other
amounts payable hereunder, shall be due and payable on the earlier of (i) that
date which is two years after the Issue Date listed above (the "Maturity
Date"), or
(ii) when, upon or after the occurrence of an Event of Default (as defined
below), such amounts are declared due and payable by Investor or made
automatically due and payable in accordance with the terms hereof.

     

    The
following is a statement of the rights of Investor and the conditions to which
this Note is subject, and to which Investor, by the acceptance of this Note,
agrees:

     

    1.  Definitions.
As used in this Note, the following capitalized terms have the following
meanings:

     

    (a)  "Obligations"
shall
mean and include all
loans, advances, debts, liabilities and obligations, howsoever arising, owed by
the Company to Investor of every kind and description (whether or not evidenced
by any note or instrument and whether or not for the payment of money), now
existing or hereafter arising under or pursuant to the terms of this Note,
including, all interest, fees, charges, expenses, attorneys' fees and costs and
accountants' fees and costs chargeable to and payable by the Company hereunder,
in each case, whether direct or indirect, absolute or contingent, due or to
become due, and whether or not arising after the commencement of a proceeding
under Title 11 of the United States Code (11 U. S.
C. Section 101 et
seq.),
as amended from time to time (including post-petition interest)
and whether or not allowed or allowable as a claim in any such
proceeding.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)  "Person" shall mean and
include an individual, a partnership, a corporation (including a business
trust), a joint stock company, a limited liability company, an unincorporated
association, a joint venture or other entity or a governmental
authority.

     

    (c)  "Securities Act" shall mean
the Securities Act of 1933, as amended.

     

    2.  Prepayment. The
Company may prepay this Note in whole or in part at any time without
penalty;
provided that any such prepayment will be applied first to the payment of
expenses due under this Note, second to interest accrued on this Note and third,
if the amount of prepayment exceeds the amount of all such expenses and accrued
interest, to the payment of principal of this Note.

     

    3.  Events
of Default. The
occurrence of any of the following shall constitute an "Event
of Default"
under this Note:

     

    (a)  Failure
to Pay. The Company shall fail to pay (1) when due any principal or
interest payment on the due date hereunder or (ii) any other payment required
under the terms of this Note on the date due and such payment shall not have
been made within five days of the Company's receipt of investor's written notice
to the Company of such failure to pay;

     

    (b)  Voluntary
Bankruptcy or Insolvency Proceedings. The Company shall (i) apply for or
consent to the appointment of a receiver, trustee, liquidator or custodian of
itself or of all or a substantial part of its property, (ii) be unable, or admit
in writing its inability, to pay its debts generally as they mature, (iii) make
a general assignment for the benefit of its or any of its creditors, (iv) be
dissolved or liquidated, (v) become insolvent (as such term may be defined or
interpreted under any applicable statute), (vi) commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in. effect or consent to any such relief or to the
appointment of or taking possession of its property by any official in
an involuntary case or other proceeding commenced against it, or (vii)
take any action for the purpose of effecting any of the foregoing;
or

     

    (c)  Involuntary
Bankruptcy or Insolvency Proceedings. Proceedings for the appointment of
a receiver, trustee, liquidator or custodian of the Company or of all or a
substantial part of the property thereof, or an involuntary case or other
proceedings seeking liquidation, reorganization or
other relief with respect to the Company or the debts thereof under any
bankruptcy, insolvency or other similar law now or hereafter in effect shall be
commenced and an order for relief entered or such proceeding shall not be
dismissed or discharged within 30 days of commencement.

     

    4.  Rights
of Investor upon Default. Upon the occurrence or existence of any Event
of Default described in Section
3(a) and
at any time thereafter during the continuance of such Event of Default,
Investor may, by written notice to the Company, declare all outstanding
Obligations payable by the Company hereunder to be immediately due and payable
without presentment, demand, protest or any other notice of any kind, all of
which are hereby expressly waived. Upon the occurrence or
existence of any Event of Default described in Sections 3(b)
and 3(c),
immediately and without notice, all outstanding Obligations immediately
due and payable, without presentment, demand, protest or any other notice of
any kind, all of which are
hereby expressly waived. In addition to the foregoing remedies, upon the
occurrence or existence of any Event of Default, Investor may exercise any other
right power or remedy granted to it by law, either by suit in equity or by
action at law, or both.

     

    
      
        
        

      

      
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    5.  Conversion.

     

    (a)  Optional
Conversion; Number of Shares Issuable Upon Conversion. All or a portion
of the outstanding principal amount of and all accrued interest under this Note
shall be convertible at the option of the Investor into that number of shares of
the Company's Common Stock as is determined by dividing the principal amount and
accrued interest on the date of conversion by $0.01 per share (adjusted to
reflect subsequent stock dividends, stock splits, combinations or
recapitalizations).

     

    (b)  Conversion
Procedure. Before Investor shall be entitled to convert this Note into
shares of Common Stock under this Section 5, the Investor shall,
at the request of the Company, execute and deliver to the Company a common stock
purchase agreement reasonably acceptable to the Company containing customary
representations and warranties and transfer restrictions (including a 180-day
lock-up agreement in connection with an initial public offering). In addition,
before Investor shall be entitled to convert this Note into shares of Common
Stock under this Section
5, it shall surrender this Note, duly endorsed, at the office of the
Company and shall give written notice to the Company at its principal corporate
office, of the election to convert the same pursuant to this Section 5, and shall state
therein the amount of the unpaid principal amount of this Note to be converted
and the name or names in which the certificate
or certificates
for shares of Common Stock are to be issued. If this Note has been lost, stolen,
destroyed or mutilated, then, in the case of loss, theft or destruction, the
Holder shall deliver an indemnity agreement reasonably satisfactory in form and
substance to the Company or, in the case of mutilation, the Holder shall
surrender and cancel this Note. The Company shall, as soon as practicable
thereafter, issue and deliver at such office to Investor a certificate or
certificates for the number of shares of Common Stock to which Investor shall be
entitled upon conversion (bearing such legends as are required by the common
stock purchase agreement, and applicable state and federal securities laws in
the opinion of counsel to the Company), together with a replacement Note (if any
principal amount is not converted) and any other securities and property to
which Investor is entitled upon such conversion under the terms of this Note,
including a check payable to Investor for any cash amounts payable as described
in Section 5(c). The conversion shall be deemed to have been made immediately
prior to the close of business on the date of the surrender of this Note, and
the Person or Persons entitled to receive the shares of Common Stock upon such
conversion shall be treated for all purposes as the record Investor or Investors
of such shares of Common Stock as of
such date.

     

    (c)  Fractional
Shares; Interest; Effect of Conversion. No fractional shares shall be
issued upon conversion of this Note. In lieu of the Company issuing any
fractional shares to Investor upon the conversion of this Note, the Company
shall pay to Investor an amount equal to the product obtained by multiplying the
conversion price by the fraction of a share not issued pursuant to the previous sentence. Upon conversion
of this Note in full and the payment of any amounts specified in this Section
5(c), the Company
shall be forever released from all its obligations and liabilities under this
Note.

     

    6.  Successors
and Assigns. Subject to the restrictions on transfer described in Sections 8 and 9 below, the rights
and obligations of the Company and Investor shall be binding upon and benefit
the successors, assigns, heirs, administrators and transferees of the
parties.

     

    7.  Waiver
and Amendment. Any provision of this Note may be amended, waived or
modified upon the written consent of the Company and the Investor.

     

    
      
        
        

      

      
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    8.  Market
Stand-Off Covenant. Investor hereby agrees that it. will not, without the
prior written consent of the managing underwriter, during the period commencing
on the date of the final prospectus relating to the Company's initial public
offering and ending on the date specified by the Company and the managing
underwriter (such period not to exceed one hundred eighty (180) calendar days)
(i) lend, offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell,
grant: any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly, any securities of the Company, whether now
owned or hereafter acquired, or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of any securities of the Company, whether now owned or hereafter
acquired, whether any such transaction described in clause (i) or (ii) above is
to be settled by delivery of securities, in cash or otherwise. The foregoing
covenants shall apply only to the Company's initial public offering of equity
securities, shall not apply to the sale of any shares by Investor to an
underwriter pursuant to an underwriting agreement. Investor agrees to execute an
agreement(s) reflecting (i) and (ii) above as may be requested by the managing
underwriters at the time of the initial public offering, and further agrees that
the Company may impose stop transfer instructions with its transfer agent in
order to enforce the covenants in (i) and (ii) above. The underwriters in
connection with the Company's initial public offering are intended third party
beneficiaries of the covenants in this Section 8 and shall
have the right, power and authority to enforce such covenants as though they
were a party hereto.

     

    9.  Assignment.
Neither this Note nor any of the rights, interests or obligations
hereunder may be assigned, by operation of law or otherwise, in whole or in
part, by the Company or the Investor without the prior written consent of the
other party.

     

    10.  Notices.
All notices, requests, demands, consents, instructions or other
communications required or permitted hereunder shall in writing and faxed,
mailed or delivered to each party at the following addresses, or at such other
address(es) or facsimile number(s) as the Company or Investor shall have
furnished to the other in writing:

     

    
      
        
          	
                  If to
      Company: 

                	27795 Country Lane,
      Suite B1 
	 	Laguna Niguel,
      California 92677 

                  Attention:
      President

                  Telephone:
      (949) 305-5389 

                  
                    Facsimile:
      (949) 305-5718

                  

                
	 	 
	If to
      Investor:   	__________________________
	 	
                  __________________________

                  Telephone:
      _________________

                  
                    Facsimile:
      __________________

                  

                


        

         

      

    

    All such
notices and communications will be deemed effectively given the earlier of (i)
when received, (ii) when delivered personally, (iii) one business day after
being delivered by facsimile (with receipt of appropriate confirmation), (iv)
one business day after being deposited with an overnight courier service of
recognized standing or (v) four days after being deposited in the U.S. mail, first class with
postage prepaid.

     

    
      
        
        

      

      
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    11.  Usury. In
the event any interest is paid on this Note which is deemed to be in excess of
the then legal maximum rate, then that portion of the interest payment
representing an amount in excess of the then legal maximum rate shall be deemed
a payment of principal and applied against the principal of this
Note.

     

    12.  Waivers.
The Company hereby waives notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor and all other notices or
demands relative to this instrument.

     

    13.  Governing
Law. This
Note and all actions arising out of or in connection with this Note shall be
governed by and construed in accordance with the laws of the State of
California, without regard to the conflicts of law provisions of the State of
California, or of any other state.

     

     

    (Signature Page
Follows)

     

     

    
      
        
        

      

      
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    The
Company has caused this Convertible Promissory Note to be issued as of the date
first written above.

     

    
      
         

        
          	 	
                  CELLYNX,
      INC.

                  a
      California corporation 

                
	 	 
	 	By:       /s/
      Tareq
      Risheq                       
      
	 	 
	 	Name:  Tareq
      Risheq                             
      
	 	 
	 	Title:    CEO                                            
      
	 	 


        

         

         

         

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