exhibit_10-28.htm


    
      

    

    Exhibit
      10.28

     

    
      THIS
        SECURED DEBENTURE, (THE “SECURITIES”), HAS NOT BEEN REGISTERED WITH THE
        UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
        OF
        ANY STATE.  THE SECURITIES ARE BEING OFFERED PURSUANT TO A SAFE HARBOR
        FROM REGISTRATION UNDER REGULATION D PROMULGATED UNDER THE SECURITIES ACT
        OF
        1933, AS AMENDED (THE “ACT”).  THE SECURITIES ARE
“RESTRICTED” AND MAY NOT BE OFFERED OR SOLD UNLESS THE SECURITIES ARE
        REGISTERED UNDER THE ACT, OR ELIGIBLE TO BE OFFERED OR SOLD PURSUANT TO
        AVAILABLE EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND THE
        COMPANY WILL BE PROVIDED WITH OPINION OF COUNSEL OR OTHER SUCH INFORMATION
        AS IT
        MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH EXEMPTIONS ARE
        AVAILABLE.  FURTHER HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY
        NOT BE MADE EXCEPT IN COMPLIANCE WITH THE ACT.

       

      


       

      SECURED
        DEBENTURE

       

       

      C-MARK
        INTERNATIONAL, INC.

       

       

      Secured
        Debenture

       

      July
        13, 2007

       

      


      
        	
                No.  ___

              	
                US$179,719.30

              


      

      


      This
        Secured Debenture (the “Debenture”) is issued on July 13, 2007
        (the “Closing Date”) by C-Mark International, Inc., a South
        Carolina corporation (the “Company”), to Trafalgar Capital Specialized
        Investment Fund, Luxembourg (together with its permitted successors and assigns,
        the “Holder”) pursuant to exemptions from registration under the
        Securities Act of 1933, as amended.

       

       

      ARTICLE
        I.

       

      Section
        1.01    Principal
        and Interest.  For value received, the
        Company hereby promises to pay to the order of the Holder on December 13,
        2007 in lawful money of the United States of America and in immediately
        available funds the principal sum of One Hundred Seventy Nine Thousand Seven
        Hundred Nineteen U.S. Dollars and thirty cents (US$179,719.30)
together with interest on the unpaid principal of this
        Debenture at the
        following rate:  (a) twelve percent (12%) per annum compounded monthly
        from the date hereof. Interest shall be computed on the basis of a 360-day
        year
        and the actual days elapsed.  Payment of the unpaid principal and
        interest shall be made from and upon receipt by the Company of the proceeds
        of
        accounts receivable for C-Mark Jobs No. 4232, No. 4357 and No. 4401
        (collectively, the “Job”) for Fort Bliss, the Twenty-Nine Palms Marine Corp Air
        Station and Afghanistan via Dover Air Force Base, respectively (collectively,
        the “Account”).  The Company is hereby obligated to redirect payment
        by such Account as the Job is completed to the Holder, which shall deduct
        any
        fees, Redemption Premium (as defined herein) and interest owing and send
        the net
        proceeds, if any, back to the Company.

       


      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      Section
        1.02    Payment
        by
        Account.  The Company shall inform the Account that on
        the business day prior to tendering any payment pursuant to the Job, the
        Account
        shall provide notice by fax and email of such Account’s name, the Job
        number and the amount being paid to:

       

      Trafalgar
        Capital
        Advisors

      Attention:
        Ivy Press, V. P. Client
        Services

      Facsimile:
        (786) 323-1651

      Email:
        ipress@trafcap.com

      


      The
        Account shall then be permitted to
        tender payment for the Job to:

      


      The
        Bank of New York, NY

      Swift: 
IRVTUS3N

      Account
        Name:  DZ Bank
        International S.A.

                 
                                                                         
Luxembourg

      Account
        # 
8900433892

      Reference: 
For
        further credit to
        Trafalgar Capital Specialized InvestmentFund

      Attn: 
OS
        Fondstransaktionen

      


      Section
        1.03    [reserved]

       

      Section
        1.04    Redemption.  The
        Company shall pay to the Holder a Redemption Premium equal to one and one-half
        percent (1.5%) for any payments received in the first thirty days after the
        Closing Date (the “Redemption Premium”).  The Redemption Premium shall
        increase by one and one-quarter percent (1.25%) for any payments received
        during
        days thirty-one through sixty after the Closing Date and by one percent (1%)
        thereafter for each thirty days or part thereof.  By way of example,
        if payment is received sixty-one (61) days after the Closing Date, the
        Redemption Premium will be three and three-quarters percent
        (3.75%).

       

      Section
        1.05    Interest
        Payments.  The interest so payable will be paid monthly
        (the “Interest Payment Date”) to the person in whose name this Debenture is
        registered.  At the time such interest is payable, the Holder, in its
        sole discretion, may elect to receive the interest in cash (via wire
        transfer or certified funds) or in the form of Common Stock at a price mutually
        agreed upon by the Company and the Holder.  In the event of default,
        as described in Article III Section 3.01 hereunder, the Holder may
        elect that the interest be paid in cash (via wire transfer or certified funds)
        or in the form of Common Stock.  If paid in the form of Common Stock,
        the amount of stock to be issued will be calculated as follows: the value
        of the
        stock shall be the Closing Bid Price on:  (i) the date the
        interest payment is due; or (ii) if the interest payment is not made when
        due, the date the interest payment is made.  A number of shares of
        Common Stock with a value equal to the amount of interest due shall be
        issued.  No fractional shares will be issued; therefore, in the event
        that the value of the Common Stock per share does not equal the total interest
        due, the Company will pay the balance in cash.

       


      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      


      Section
        1.06    Paying
        Agent and Registrar.  Initially, the Company will act as
        paying agent and registrar.  The Company may change any paying agent,
        registrar, or Company-registrar by giving the Holder not less than ten (10)
        business days’ written notice of its election to do so, specifying the name,
        address, telephone number and facsimile number of the paying agent or
        registrar.  The Company may act in any such capacity.

       

      Section
        1.07    Secured
        Nature of Debenture.  This Debenture is secured by a
        direct participation in and direct right of redirection of the payments relating
        to the Account’s project being financed, which is set forth on Exhibit A to the
        Security Agreement dated the date hereof between the Company and the Holder
        (the
“Security Agreement”).  As set forth in the Security Agreement,
        Holder’s security interest shall terminate upon the occurrence of an Expiration
        Event as defined in the Security Agreement.

       

      Section
        1.08    Currency
        Exchange Rate Protections.

       

      (a)    “Closing
        Date
        Exchange Rate” means the Euro to US dollar spot exchange rate as quoted in the
        London edition of the Financial Times on the Closing Date.

       

      (b)
                   “Repayment
        Exchange Rate” means in relation to each date of a
        Redemption Notice, the Euro to US dollar spot exchange
        rate as quoted by in the London edition of the Financial Times on such
        date.

       

      (c)           If
        on the date of any Redemption Notice, the Repayment Exchange Rate is less
        than
        the Closing Date Exchange Rate then the number of Shares to be issued shall
        be
        increased by the same percentage as results from dividing the Closing Date
        Exchange Rate by the relevant Repayment Exchange Rate.  By way of
        example, if the number of Shares to be issued in respect of a particular
        Redemption Notice would, but for this Section 1.08, be 1,000 and if the Closing
        Date Exchange Rate is 1.80 and the relevant Repayment Exchange Rate is 1.75,
        then 1,029 Shares will be issued in relation to that Redemption Notice, as
        the
        case may be.

       

      (d)           If
        on the Repayment Date or any Interest Repayment Date, the Cash Payment Date
        Exchange Rate, as defined below is less than the Closing Date Exchange Rate
        then
        the amount of cash required to satisfy the amounts due at such time shall
        be
        increased by the same percentage as results from dividing the Closing Date
        Exchange Rate by the relevant Cash Payment Date Exchange Rate. “Cash Payment
        Date Exchange Rate” means in
        relation to each Repayment Date or Interest Repayment Date
        the Euro to US dollar spot exchange
        rate as quoted in the London edition of the Financial Times on such
        date.  By way of example, if the amount of cash required to repay all
        amounts due on such date would, but for this Section 1.08, be $1,000 and
        if the
        Closing Date Exchange Rate is 1.80 and the relevant Repayment Date Exchange
        Rate
        is 1.75 then the amount of cash from the Cash Payment required to repay all
        amounts due on such date will be $1,028.57.

       


      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      


      ARTICLE
        II.

       

      Section
        2.01    Amendments
        and Waiver of Default.  The Debenture
        may not be amended.  Notwithstanding the above, without the consent of
        the Holder, the Debenture may be amended to cure any ambiguity, defect or
        inconsistency, or to provide for assumption of the Company obligations to
        the
        Holder.

       

       

      ARTICLE
        III.

       

      Section
        3.01    Events of
        Default.  An Event of Default is defined
        as follows: (a) failure by the Company to pay amounts due hereunder within
        fifteen (15) days of the date of maturity of this Debenture;
        (b) [reserved]; (c) [reserved]; (d) failure by the Company for
        ten (10) days after notice to it to comply with any of its other agreements
        in the Debenture; (e) events of bankruptcy or insolvency; (f) a breach
        by the Company of its obligations under the Securities Purchase Agreement
        which
        is not cured by the Company within ten (10) days after receipt of written
        notice
        thereof.  Upon the occurrence of an Event of Default, the Holder may,
        in its sole discretion, accelerate full repayment of all debentures outstanding
        and accrued interest thereon or may, notwithstanding any limitations contained
        in this Debenture and/or the Securities Purchase Agreement dated the date
        hereof
        between the Company and Trafalgar Capital Specialized Investment Fund,
        Luxembourg (the “Securities Purchase Agreement”).

       

      Section
        3.02    Failure
        to
        Issue Unrestricted Common Stock. As indicated in
        Article III Section 3.01, a breach by the Company of its obligations
        under the Securities Purchase Agreement shall be deemed an Event of Default,
        which if not cured within ten (10) days, shall entitle the Holder to
        accelerate full repayment of all debentures outstanding and accrued interest
        thereon or, notwithstanding any limitations contained in this Debenture and/or
        the Securities Purchase Agreement.

       

       

      ARTICLE
        IV.

       

      Section
        4.01    [reserved].

       

      Section
        4.02    [reserved]

       

      Section
        4.03    [reserved]

       

       

      ARTICLE
        V.

       

      Section
        5.01    [reserved]

       

      Section
        5.02    Consent  of
        Holder to Sell Capital Stock or Grant Security
        Interests.  Except for the Securities
        Purchase Agreement dated the date hereof between the Company and Trafalgar
        Capital Specialized Investment Fund, Luxembourg, so long as any of the principal
        of or interest on this Debenture remains unpaid, the Company shall not, without
        the prior consent of the Holder, issue or sell (i) any Common Stock or
        Preferred Stock without consideration or for a consideration per share less
        than
        its fair market value determined immediately prior to its issuance,
        (ii) issue or sell any Preferred Stock, warrant, option, right, contract,
        call, or other security or instrument granting the holder thereof the right
        to
        acquire Common Stock without consideration or for a consideration per share
        less
        than such Common Stock’s fair market value determined immediately prior to its
        issuance, (iii) enter into any security instrument granting the holder a
        security interest in any of the assets of the Company, or (iv) file any
        registration statement on Form S-8.

       


      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      


      ARTICLE
        VI.

       

      Section
        6.01    Notice.  Notices
        regarding this Debenture shall be sent to the parties at the following
        addresses, unless a party notifies the other parties, in writing, of a change
        of
        address:

       

      
        	
                If
                  to the Company, to:

              	
                C-Mark
                  International, Inc..

              
	 	
                4130
                  E. Van Buren, Suite 325

              
	 	
                Phoenix,
                  AZ 85008

              
	 	
                Attn:
                  Mr. Charles Jones, CEO

              
	 	
                Telephone:
                  (602) 443-8640

              
	 	
                Facsimile:
                  (602) 443-8646

              
	 	 
	
                With
                  a copy to:

              	
                The
                  O’Neal Law Firm, P.C.

              
	 	
                17100
                  E. Shea Blvd., Suite 400-D

              
	 	
                Fountain
                  Hills, AZ  85268

              
	 	
                Attention:  William
                  D. O’Neal, Esq.

              
	 	
                Telephone:
                  (480) 812-5058

              
	 	
                Facsimile:
                  (480) 816-9241

              
	 	 
	
                If
                  to the Holder:

              	
                Trafalgar
                  Capital Specialized Investment Fund

              
	 	
                8-10
                  Rue Mathias Hardt

              
	 	
                BP
                  3023

              
	 	
                L-1030
                  Luxembourg

              
	 	
                Attention: Andrew
                  Garai, Chairman of the Board of

              
	 	
                Facsimile:       011-44-207-405-0161
                  and

                                        001-786-323-1651

              
	 	 
	 	 
	
                With
                  a copy to:

              	
                James
                  G. Dodrill II, P.A.

              
	 	
                5800
                  Hamilton Way

              
	 	
                Boca
                  Raton, FL  33496

              
	 	
                Attention:
                  James Dodrill, Esq.

              
	 	
                Telephone:
                  (561) 862-0529

              
	 	
                Facsimile:
                  (561) 892-7787

              
	 	 


      

      


      Section
        6.02    Governing
        Law.  This Debenture shall be deemed to
        be made under and shall be construed in accordance with the laws of the State
        of
        Florida without giving effect to the principals of conflict of laws
        thereof.  Each of the parties consents to the jurisdiction of the
        U.S. District Court sitting in the Southern District of the State of
        Florida or the state courts of the State of Florida sitting in Broward County,
        Florida in connection with any dispute arising under this Debenture and hereby
        waives, to the maximum extent permitted by law, any objection, including
        any
        objection based on forumnonconveniens to the bringing of
        any such proceeding in such jurisdictions.

       


      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      Section
        6.03    Severability.  The
        invalidity of any of the provisions of this Debenture shall not invalidate
        or
        otherwise affect any of the other provisions of this Debenture, which shall
        remain in full force and effect.

       

      Section
        6.04    Entire
        Agreement and Amendments.  This
        Debenture represents the entire agreement between the parties hereto with
        respect to the subject matter hereof and there are no representations,
        warranties or commitments, except as set forth herein.  This Debenture
        may be amended only by an instrument in writing executed by the parties
        hereto.

       

      Section
        6.05    Counterparts.  This
        Debenture may be executed in multiple counterparts, each of which shall be
        an
        original, but all of which shall be deemed to constitute on
        instrument.

       

      IN
        WITNESS WHEREOF, with the intent to be legally bound hereby, the
        Company as executed this Debenture as of the date first written
        above.

       

      
        	 	
                CMARK
                  INTERNATIONAL, INC.

              
	 	 
	 	
                By:    /s/ 
                  Charles W. Jones,
                  Jr.                                                                                         

              
	 	
                Name:    Charles
                  W. Jones,
                  Jr.                           

              
	 	
                Title:   President                                                  

              


      

      
 

       

       

       6