Document:

Unassociated Document

Exhibit 10.3

Loan Agreement

April 1, 2011

This Loan Agreement (“Agreement,”) is made and entered into to be effective upon execution by and among ContinuityX, Inc., a Delaware Corporation with an address at 610 State Route 116, Metamora, IL 61548 (the “Borrower”), and Gary Elliston, the Individual lender with an Office in Dallas, TX who is signatory hereto, (“Lender”).

WHEREAS, Lender has agreed to lend to Borrower the Loan (as defined hereinafter) pursuant to the terms of this Agreement and the Note (as defined hereinafter).

NOW THEREFORE, for good consideration and short-term depository coverage with AT&T Order Contract Ref # 139357UA, the parties hereto, intending to be legally bound, agree as follows:

	
  

	
1.

	
Loan Agreement. Borrower hereby agrees to borrow from Lender, and Lender hereby agrees to lend to Borrower on the date hereof, the amount $141,000.00. (assignment of original deposit of $120,000, and fees of $21,000)

	
  

	
a.

	
Funding, The Loan is on deposit with AT&T since February, 2011.

	 	
2.

	
Terms.

	
  

	
a.

	
Interest Rate. The Loan shall receive an interest rate of 1.5% of loan amount outstanding per month pro-rata during period. (Annual Rate 18%)

	
  

	
b.

	
Maturity. The Loan shall mature on the earlier of (i) September 30, 2011 or (ii) upon the Company’s return of security deposit proceeds from AT&T Contract Ref # 139357UA, The Company shall maintain a Cure Period of 30 days (October 27, 2011) with a penalty of 3% over and above the stated monthly interest rate of 1.5%.

	
  

	
c.

	
Security. The Loan shall be secured with a first lien on the AT&T security deposit described above and all other assets of the Company.

	
  

	
d.

	
Insurance Coverage. The Borrower shall maintain in full force and effect insurance coverage that is customary for comparably situated companies and represents total liability insurance coverage currently in place exceeding $2 million in face amount death benefit.

	
  

	
e.

	
Management Warranty. The Founder and Executive Director, Anthony Roth shall guarantee such Loan is returned with a cure period of 90 days at 15% annual interest rate in the event of Company default.

  

  

  

Indemnification. The Borrower agrees to indemnify and hold harmless Lender from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Borrower under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

Counterparts; Faxes. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via facsimile, which shall be deemed an original.

Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof

Arbitration. The parties agree that they will use their best efforts to amicably resolve any dispute arising out of or relating to this Agreement. Any dispute that cannot be resolved amicably shall be settled by final binding arbitration in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Any such arbitration shall be conducted in Texas, or such other place as may be mutually agreed upon by the parties. Within fifteen (15) days after the commencement of the arbitration, each party shall select one person to act as arbitrator, and the two arbitrators so selected shall select a third arbitrator within ten (10) days of their appointment. Each party shall bear its own costs and expenses and an equal share of the arbitrator’s expenses and administrative fees of arbitration.

Representations. As applicable, the Borrower represents and warrants to the Lenders as follows:

Good Standing. Borrower is a Corporation in good standing and enters into this Agreement per the laws of each jurisdiction where such qualification is material to the conduct of business.

  

  

  

Binding Agreement. This Agreement when issued and delivered pursuant hereto for value received, shall constitute, the legal, valid, and binding obligation of the Borrower in accordance with its terms subject to bankruptcy and insolvency laws and any other laws of general application affecting the rights and remedies of creditors. This Agreement shall constitute the legal, valid, and binding obligation of the Borrower in accordance with its terms, subject to bankruptcy and dissolution via insolvency laws and any other laws of general application affecting the rights and remedies of creditors.

Affirmative Covenants. Until the payment in full of the Loan and performance of all obligations of the Borrower hereunder, unless otherwise indicated, shall:

Taxes. Pay and discharge all taxes, assessments, and governmental charges upon it, its incomes, and its properties prior to the date on which penalties are attached thereto, unless and to the extent only that such taxes shall be contested in good faith and by appropriate proceedings by the Borrower, as applicable.

Insurance. Maintain insurance with insurance companies acceptable to the Lender on such investments and properties, in such amounts and against such risks as is customarily maintained by similar businesses operating within the same industry.

Maintenance. Maintain, preserve, and keep the investments or collateral in good standing and in safe-keeping condition.

Events of Default. The amounts due hereunder shall become immediately due and payable in full upon the occurrence of any one or more of the following events of default (the “Events of Default”).

	
  

	
a.

	
Default in the payment of the principal of the Loan when due and payable, whether at maturity or otherwise, that is not cured within 30 days; or

	
  

	
b.

	
Failure of Borrower to observe or perform any material term, covenant, or agreement contained in this Agreement that is not cured within 30 days, or the dissolution, termination of existence, or business failure of the Borrower.

Assignment. No portion of the Loan shall be assignable to a third party without the express written consent of the Borrower.

 

  

  

  

 

Miscellaneous

 

	 	
a.

	
This Agreement constitutes the entire agreement between the Borrower and the Lender. All computations and determinations of the assets and liabilities of Borrower the purpose of this Agreement shall be made in accordance with generally accepted accounting principles consistently applied, except as may be otherwise specifically provided herein. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date of service if personally served on the party to whom such notice is to be given, on the date of transmittal of service via telecopy to the party to whom notice is to be given (with a confirming copy delivered within 24 hours thereafter), or on the third day after mailing if mailed to the party to whom notice is to be given, by first class mail, registered or certified mail, postage prepaid, or via a recognized overnight courier providing a receipt for delivery and properly addressed to the parties at the respective addresses of the parties as set forth herein. Any party hereto may by notice so given change its address for future notice hereunder.

	 	
b.

	
This Agreement shall be binding upon Borrower and their respective successors and assigns, and shall inure to the benefit of the Lenders and the benefit of their respective successors and assigns, including any subsequent holder or holders of the Notes or any interest therein.

Governing Law. The Laws of the State of Illinois shall govern this Agreement.

Executed on the day and year below written. This Agreement may be executed in any number of counterparts, each constituting an original, but altogether one agreement. A facsimile or other copy of this Agreement shall be considered as having the same effect and be equivalent to an original signed document.

 

	ContinuityX, Inc.	 	
 

	Gary Elliston	 
	 	 	 	 	 	 
	
By:

	
/s/ Anthony G. Roth

	 	
By:

	/s/ Gary Elliston  	 
	
Name:

	
Anthony G. Roth,

	 	  	  	 
	  	
Treasurer & Director

	 	  	  	 
	
Date:

	
April 1, 2011

	 	
Date:

	April 1, 2011	 

  

  

  

Loan Agreement

April 21, 2011

This Loan Agreement (“Agreement”) is made and entered into to be effective upon execution by and among ContinuityX, Inc., a Deleware Corporation with an address at 2401 E. Washington Street, Bloomington, IL 61704 (the “Borrower”), and Gary Elliston, the Individual lender with an Office in Dallas, TX who is signatory hereto, (“Lender”).

WHEREAS, Lender has agreed to lend to Borrower the Loan (as defined hereinafter) pursuant to the terms of this Agreement and the Note (as defined hereinafter).

NOW THEREFORE, for good consideration and short-term operating purposes, the parties hereto, intending to be legally bound, agree as follows

	
  

	
1.

	
Loan Agreement. Borrower hereby agrees to borrow from each Lender, and each Lender hereby agrees to lend to Borrower on the date hereof, the amount $45,000.

	
  

	
a.

	
Funding. The Loan will be funded on/before Tuesday, April 26, 2011.

	 	
2.

	
Terms.

	
  

	
a.

	
Investment Participation Fee & Interest Rate. The Loan shall receive a return of no lower than 8% or $3,600. This fee shall be paid upon or no later than June 30, 2011. The Interest Rate is 1% per month simple interest.

	
  

	
b.

	
Maturity. The Loan shall mature on the earlier of (i) June 30, 2011 or (ii) upon the Company’s cash collections exceeding $750,000 within any 30 day period.

	
  

	
c.

	
Security. The Loan shall be secured only by the assets, receivables and investments held by the Borrower that may be subject to subordination by third-party financiers.

	
  

	
d.

	
Insurance Coverage. The Borrower shall maintain in full force and effect insurance coverage that is customary for comparably situated companies and represents total liability insurance coverage currently in place exceeding $2 million in face amount death benefit.

Indemnification. The Borrower agrees to indemnify and hold harmless Lender from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Borrower under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

  

  

  

Counterparts; Faxes. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via facsimile, which shall be deemed an original.

Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof.

Arbitration. The parties agree that they will use their best efforts to amicably resolve any dispute arising out of or relating to this Agreement. Any dispute that cannot be resolved amicably shall be settled by final binding arbitration in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Any such arbitration shall be conducted in Texas, or such other place as may be mutually agreed upon by the parties. Within fifteen (15) days after the commencement of the arbitration, each party shall select one person to act as arbitrator, and the two arbitrators so selected shall select a third arbitrator within ten (10) days of their appointment. Each party shall bear its own costs and expenses and an equal share of the arbitrator’s expenses and administrative fees of arbitration.

Representations. As applicable, the Borrower represents and warrants to the Lenders as follows:

Good Standing. Borrower is a Corporation in good standing and enters into this Agreement per the laws of each jurisdiction where such qualification is material to the conduct of business.

Binding Agreement. This Agreement when issued and delivered pursuant hereto for value received, shall constitute, the legal, valid, and binding obligation of the Borrower in accordance with its terms subject to bankruptcy and insolvency laws and any other laws of general application affecting the rights and remedies of creditors. This Agreement shall constitute the legal, valid, and binding obligation of the Borrower in accordance with its terms, subject to bankruptcy and dissolution via insolvency laws and any other laws of general application affecting the rights and remedies of creditors.

  

  

  

Affirmative Covenants. Until the payment in full of the Loan and performance of all obligations of the Borrower hereunder, unless otherwise indicated, shall;

Taxes. Pay and discharge all taxes, assessments, and governmental charges upon it, its incomes, and its properties prior to the date on which penalties are attached thereto, unless and to the extent only that such taxes shall be contested in good faith and by appropriate proceedings by the Borrower, as applicable.

Insurance. Maintain insurance with insurance companies acceptable to the Lender on such investments and properties, in such amounts and against such risks as is customarily maintained by similar businesses operating within the same industry.

Maintenance. Maintain, preserve, and keep the investments or collateral in good standing and in safe-keeping condition.

Events of Default. The amounts due hereunder shall become immediately due and payable in full upon the occurrence of any one or more of the following events of default (the “Events of Default”).

	
  

	
a.

	
Default in the payment of the principal of the Loan when due and payable, whether at maturity or otherwise, that is not cured within 30 days; or

	
  

	
b.

	
Failure of Borrower to observe or perform any material term, covenant, or agreement contained in this Agreement that is not cured within 30 days, or the dissolution, termination of existence, or business failure of the Borrower.

Assignment. No portion of the Loan shall be assignable to a third party without the express written consent of the Borrower.

Miscellaneous

	
  

	
a.

	
This Agreement constitutes the entire agreement between the Borrower and the Lender. All computations and determinations of the assets and liabilities of Borrower the purpose of this Agreement shall be made in accordance with generally accepted accounting principles consistently applied, except as may be otherwise specifically provided herein. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date of service if personally served on the party to whom such notice is to be given, on the date of transmittal of service via telecopy to the party to whom notice is to be given (with a confirming copy delivered within 24 hours thereafter), or on the third day after mailing if mailed to the party to whom notice is to be given, by first class mail, registered or certified mail, postage prepaid, or via a recognized overnight courier providing a receipt for delivery and properly addressed to the parties at the respective addresses of the parties as set forth herein. Any party hereto may by notice so given change its address for future notice hereunder.

  

  

  

	
  

	
b.

	
This Agreement shall be binding upon Borrower and their respective successors and assigns, and shall inure to the benefit of the Lenders and the benefit of their respective successors and assigns, including any subsequent holder or holders of the Notes or any interest therein.

Governing Law. The Laws of the State of Texas shall govern this Agreement.

Executed on the day and year below written. This Agreement may be executed in any number of counterparts, each constituting an original, but altogether one agreement. A facsimile or other copy of this Agreement shall be considered as having the same effect and be equivalent to an original signed document.

 

	ContinuityX, Inc.	 	

Gary Elliston

	 
	 	 	 	 	 	 
	
By:

	
/s/ Anthony G. Roth

	 	
By:

	/s/ Gary Elliston	 
	
Name:

	

Anthony G. Roth, Director

	 	  	  	 
	
Date:

	

March 1, 2011

	 	
Date:

	March 1, 2011 	 

  

  

  

Loan Agreement

May 11, 2011

This Loan Agreement (“Agreement”) is made and entered into to be effective upon execution by and among ContinuityX, Inc., a Deleware Corporation with an address at 2401 E. Washington Street, Bloomington, IL 61704 (the “Borrower”), and Gary Elliston, the Individual lender with an Office in Dallas, TX who is signatory hereto, (“Lender”),

WHEREAS, Lender has agreed to lend to Borrower the Loan (as defined hereinafter) pursuant to the terms of this Agreement and the Note (as defined hereinafter).

NOW THEREFORE, for good consideration and short-term operating purposes, the parties hereto, intending to be legally bound, agree as follows

	
  

	
1.

	
Loan Agreement. Borrower hereby agrees to borrow from each Lender, and each Lender hereby agrees to lend to Borrower on the date hereof, the amount $25,000.

 

	 	
a.

	
Funding. The Loan will be funded on/before Wednesday, May 11, 2011.

 

	 	
2.

	
Terms.

	
  

	
a.

	
Investment Participation Fee & Interest Rate. The Loan shall receive a return of no lower than 5% or $ 1,250. This fee shall be paid upon or no later than May 26, 2011. The Interest Rate is 1% per month simple interest.

	
  

	
b.

	
Maturity. The Loan shall mature on the earlier of (i) May 26, 2011 or (ii) upon the Company’s cash collections exceeding $750,000 within any 30 day period.

	
  

	
c.

	
Security. The Loan shall be secured only by the assets, receivables and investments held by the Borrower that may be subject to subordination by third-party financiers.

	
  

	
d.

	
Insurance Coverage. The Borrower shall maintain in full force and effect insurance coverage that is customary for comparably situated companies and represents total liability insurance coverage currently in place exceeding $2 million in face amount death benefit.

Indemnification. The Borrower agrees to indemnify and hold harmless Lender from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Borrower under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

  

  

  

Counterparts; Faxes. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via facsimile, which shall be deemed an original.

Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof.

Arbitration. The parties agree that they will use their best efforts to amicably resolve any dispute arising out of or relating to this Agreement. Any dispute that cannot be resolved amicably shall be settled by final binding arbitration in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Any such arbitration shall be conducted in Texas, or such other place as may be mutually agreed upon by the parties. Within fifteen (15) days after the commencement of the arbitration, each party shall select one person to act as arbitrator, and the two arbitrators so selected shall select a third arbitrator within ten (10) days of their appointment. Each party shall bear its own costs and expenses and an equal share of the arbitrator’s expenses and administrative fees of arbitration.

Representations. As applicable, the Borrower represents and warrants to the Lenders as follows;

Good Standing. Borrower is a Corporation in good standing and enters into this Agreement per the laws of each jurisdiction where such qualification is material to the conduct of business.

Binding Agreement. This Agreement when issued and delivered pursuant hereto for value received, shall constitute, the legal, valid, and binding obligation of the Borrower in accordance with its terms subject to bankruptcy and insolvency laws and any other laws of general application affecting the rights and remedies of creditors. This Agreement shall constitute the legal, valid, and binding obligation of the Borrower in accordance with its terms, subject to bankruptcy and dissolution via insolvency laws and any other laws of general application affecting the rights and remedies of creditors.

  

  

  

Affirmative Covenants. Until the payment in full of the Loan and performance of all obligations of the Borrower hereunder, unless otherwise indicated, shall:

Taxes. Pay and discharge all taxes, assessments, and governmental charges upon it, its incomes, and its properties prior to the date on which penalties are attached thereto, unless and to the extent only that such taxes shall be contested in good faith and by appropriate proceedings by the Borrower, as applicable.

Insurance. Maintain insurance with insurance companies acceptable to the Lender on such investments and properties, in such amounts and against such risks as is customarily maintained by similar businesses operating within the same industry.

Maintenance. Maintain, preserve, and keep the investments or collateral in good standing and in safe-keeping condition.

Events of Default. The amounts due hereunder shall become immediately due and payable in full upon the occurrence of any one or more of the following events of default (the “Events of Default”).

	
  

	
a.

	
Default in the payment of the principal of the Loan when due and payable, whether at maturity or otherwise, that is not cured within 30 days; or

	
  

	
b.

	
Failure of Borrower to observe or perform any material term, covenant, or agreement contained in this Agreement that is not cured within 30 days, or the dissolution, termination of existence, or business failure of the Borrower.

Assignment. No portion of the Loan shall be assignable to a third party without the express written consent of the Borrower.

Miscellaneous

	
  

	
a.

	
This Agreement constitutes the entire agreement between the Borrower and the Lender. All computations and determinations of the assets and liabilities of Borrower the purpose of this Agreement shall be made in accordance with generally accepted accounting principles consistently applied, except as may be otherwise specifically provided herein. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date of service if personally served on the party to whom such notice is to be given, on the date of transmittal of service via telecopy to the party to whom notice is to be given (with a confirming copy delivered within 24 hours thereafter), or on the third day after mailing if mailed to the party to whom notice is to be given, by first class mail, registered or certified mail, postage prepaid, or via a recognized overnight courier providing a receipt for delivery and properly addressed to the parties at the respective addresses of the parties as set forth herein. Any party hereto may by notice so given change its address for future notice hereunder.

  

  

  

	
  

	
b.

	
This Agreement shall be binding upon Borrower and their respective successors and assigns, and shall inure to the benefit of the Lenders and the benefit of their respective successors and assigns, including any subsequent holder or holders of the Notes or any interest therein.

 

Governing Law. The Laws of the State of Texas shall govern this Agreement.

Executed on the day and year below written. This Agreement may be executed in any number of counterparts, each constituting an original, but altogether one agreement. A facsimile or other copy of this Agreement shall be considered as having the same effect and be equivalent to an original signed document.

	
ContinuityX, Inc.

	 	  	
Gary Elliston

	 
	  	 	  	 
	
By:

	/s/ Anthony G. Roth	 	  	
By:

	/s/ Gary Elliston	 
	
Name:

	
Anthony G. Roth. Director

	 	  	 
	
Date:

	
May 11, 2011

	 	
Date: May 11, 2011

	 

  

  

  

Loan Agreement

June 17, 2011

This Loan Agreement (“Agreement”) is made and entered into to be effective upon execution by and among ContinuityX, Inc., a Deleware Corporation with an address at 2401 E. Washington Street, Bloomington, IL 61704 (the “Borrower”), and Gary Elliston, the Individual lender with an Office in Dallas, TX who is signatory hereto, (“Lender”).

WHEREAS, Lender has agreed to lend to Borrower the Loan (as defined hereinafter) pursuant to the terms of this Agreement and the Note (as defined hereinafter).

NOW THEREFORE, for good consideration and short-term operating purposes, the parties hereto, intending to be legally bound, agree as follows

	
  

	
1.

	
Loan Agreement. Borrower hereby agrees to borrow from each Lender, and each Lender hereby agrees to lend to Borrower on the date hereof, the amount $46,000.

	 	
a.

	
Funding. The Loan will be funded on/before June 20, 2011.

	 	
2.

	
Terms.

	
  

	
a.

	
Investment Participation Fee & Interest Rate. The Loan shall receive a return of no lower than 8%. This fee shall be paid upon or no later than August 30, 2011. The Interest Rate is 1.5% per month simple interest.

	
  

	
b.

	
Maturity. The Loan shall mature on the earlier of (i) August 30, 2011 or (ii) upon the Company’s cash collections exceeding $750,000 within any 30 day period.

	
  

	
c.

	
Security. The Loan shall be secured only by the assets, receivables and investments held by the Borrower that may be subject to subordination by third-party financiers.

	
  

	
d.

	
Insurance Coverage. The Borrower shall maintain in full force and effect insurance coverage that is customary for comparably situated companies and represents total liability insurance coverage currently in place exceeding $2 million in face amount death benefit.

Indemnification. The Borrower agrees to indemnify and hold harmless Lender from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Borrower under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

  

  

  

Counterparts; Faxes. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via facsimile, which shall be deemed an original.

Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof

Arbitration. The parties agree that they will use their best efforts to amicably resolve any dispute arising out of or relating to this Agreement. Any dispute that cannot be resolved amicably shall be settled by final binding arbitration in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Any such arbitration shall be conducted in Texas, or such other place as may be mutually agreed upon by the parties. Within fifteen (15) days after the commencement of the arbitration, each party shall select one person to act as arbitrator, and the two arbitrators so selected shall select a third arbitrator within ten (10) days of their appointment. Each party shall bear its own costs and expenses and an equal share of the arbitrator’s expenses and administrative fees of arbitration.

Representations. As applicable, the Borrower represents and warrants to the Lenders as follows:

Good Standing. Borrower is a Corporation in good standing and enters into this Agreement per the laws of each jurisdiction where such qualification is material to the conduct of business.

Binding Agreement. This Agreement when issued and delivered pursuant hereto for value received, shall constitute, the legal, valid, and binding obligation of the Borrower in accordance with its terms subject to bankruptcy and insolvency laws and any other laws of general application affecting the rights and remedies of creditors. This Agreement shall constitute the legal, valid, and binding obligation of the Borrower in accordance with its terms, subject to bankruptcy and dissolution via insolvency laws and any other laws of general application affecting the rights and remedies of creditors.

  

  

  

Affirmative Covenants. Until the payment in full of the Loan and performance of all obligations of the Borrower hereunder, unless otherwise indicated, shall:

Taxes. Pay and discharge all taxes, assessments, and governmental charges upon it, its incomes, and its properties prior to the date on which penalties are attached thereto, unless and to the extent only that such taxes shall be contested in good faith and by appropriate proceedings by the Borrower, as applicable.

Insurance. Maintain insurance with insurance companies acceptable to the Lender on such investments and properties, in such amounts and against such risks as is customarily maintained by similar businesses operating within the same industry.

Maintenance. Maintain, preserve, and keep the investments or collateral in good standing and in safe-keeping condition.

Events of Default. The amounts due hereunder shall become immediately due and payable in full upon the occurrence of any one or more of the following events of default (the “Events of Default”).

	
  

	
a.

	
Default in the payment of the principal of the Loan when due and payable, whether at maturity or otherwise, that is not cured within 30 days; or

	
  

	
b.

	
Failure of Borrower to observe or perform any material term, covenant, or agreement contained in this Agreement that is not cured within 30 days, or the dissolution, termination of existence, or business failure of the Borrower.

Assignment. No portion of the Loan shall be assignable to a third party without the express written consent of the Borrower.

Miscellaneous

	
  

	
a.

	
This Agreement constitutes the entire agreement between the Borrower and the Lender. All computations and determinations of the assets and liabilities of Borrower the purpose of this Agreement shall be made in accordance with generally accepted accounting principles consistently applied, except as may be otherwise specifically provided herein. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date of service if personally served on the party to whom such notice is to be given, on the date of transmittal of service via telecopy to the party to whom notice is to be given (with a confirming copy delivered within 24 hours thereafter), or on the third day after mailing if mailed to the party to whom notice is to be given, by first class mail, registered or certified mail, postage prepaid, or via a recognized overnight courier providing a receipt for delivery and properly addressed to the parties at the respective addresses of the parties as set forth herein. Any party hereto may by notice so given change its address for future notice hereunder.

  

  

  

	 	
b.

	
This Agreement shall be binding upon Borrower and their respective successors and assigns, and shall inure to the benefit of the Lenders and the benefit of their respective successors and assigns, including any subsequent holder or holders of the Notes or any interest therein.

Governing Law. The Laws of the State of Texas shall govern this Agreement.

Executed on the day and year below written. This Agreement may be executed in any number of counterparts, each constituting an original, but altogether one agreement. A facsimile or other copy of this Agreement shall be considered as having the same effect and be equivalent to an original signed document.

	
ContinuityX, Inc.

	 	
Gary Elliston

	 
	  	 	  	 
	
By:

	
/s/ Anthony G. Roth

	 	
By:

	/s/ Gary Elliston	 
	
Name:

	
Anthony G. Roth, Director

	 	  	
Gary Elliston

	 
	
Date:

	
June 17, 2011

	 	  	
Date: June 17, 2011

	 

  

  

  

Loan Agreement

July 27, 2011

This Loan Agreement (“Agreement”) is made and entered into to be effective upon execution by and among ContinuityX, Inc., a Deleware Corporation with an address at 2401 E. Washington Street, Bloomington, IL 61704 (the “Borrower”), and Gary Elliston, the Individual lender with an Office in Dallas, TX who is signatory hereto, (“Lender”).

WHEREAS, Lender has agreed to lend to Borrower the Loan (as defined hereinafter) pursuant to the terms of this Agreement and the Note (as defined hereinafter).

NOW THEREFORE, for good consideration and short-term operating purposes, the parties hereto, intending to be legally bound, agree as follows

	
  

	
1.

	
Loan Agreement. Borrower hereby agrees to borrow from each Lender, and each Lender hereby agrees to lend to Borrower on the date hereof, the amount $55,000.

	 	
a.

	
Funding. The Loan will be funded on/before July 27, 2011.

	 	
2.

	
Terms.

	
  

	
a.

	
Investment Participation Fee & Interest Rate. The Loan shall receive a return of no lower than 8%. This fee shall be paid upon or no later than September 30, 2011. The Interest Rate is 1.5% per month simple interest.

	
  

	
b.

	
Maturity. The Loan shall mature on the earlier of (i) September 30, 2011 or (ii) upon the Company’s cash collections exceeding $750,000 within any 30 day period.

	
  

	
c.

	
Security. The Loan shall be secured only by the assets, receivables and investments held by the Borrower that may be subject to subordination by third-party financiers.

	
  

	
d.

	
Insurance Coverage. The Borrower shall maintain in full force and effect insurance coverage that is customary for comparably situated companies and represents total liability insurance coverage currently in place exceeding $2 million in face amount death benefit.

Indemnification. The Borrower agrees to indemnify and hold harmless Lender from and against any and all losses, claims, damages, liabilities and expenses (including without limitation reasonable attorney fees and disbursements and other expenses incurred in connection with investigating, preparing or defending any action, claim or proceeding, pending or threatened and the costs of enforcement thereof) (collectively, “Losses”) to which such Person may become subject as a result of any breach of representation, warranty, covenant or agreement made by or to be performed on the part of the Borrower under the Transaction Documents, and will reimburse any such Person for all such amounts as they are incurred by such Person.

  

  

  

Counterparts: Faxes. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may also be executed via facsimile, which shall be deemed an original.

Titles and Subtitles, The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

Entire Agreement. This Agreement, including the Exhibits and the Disclosure Schedules, and the other Transaction Documents constitute the entire agreement among the parties hereof with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter hereof and thereof.

Arbitration. The parties agree that they will use their best efforts to amicably resolve any dispute arising out of or relating to this Agreement. Any dispute that cannot be resolved amicably shall be settled by final binding arbitration in accordance with the rules of the American Arbitration Association and judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Any such arbitration shall be conducted in Texas, or such other place as may be mutually agreed upon by the parties. Within fifteen (15) days after the commencement of the arbitration, each party shall select one person to act as arbitrator, and the two arbitrators so selected shall select a third arbitrator within ten (10) days of their appointment. Each party shall bear its own costs and expenses and an equal share of the arbitrator’s expenses and administrative fees of arbitration.

Representations. As applicable, the Borrower represents and warrants to the Lenders as follows:

Good Standing. Borrower is a Corporation in good standing and enters into this Agreement per the laws of each jurisdiction where such qualification is material to the conduct of business.

Binding Agreement. This Agreement when issued and delivered pursuant hereto for value received, shall constitute, the legal, valid, and binding obligation of the Borrower in accordance with its terms subject to bankruptcy and insolvency laws and any other laws of general application affecting the rights and remedies of creditors. This Agreement shall constitute the legal, valid, and binding obligation of the Borrower in accordance with its terms, subject to bankruptcy and dissolution via insolvency laws and any other laws of general application affecting the rights and remedies of creditors.

  

  

  

Affirmative Covenants. Until the payment in full of the Loan and performance of all obligations of the Borrower hereunder, unless otherwise indicated, shall:

Taxes. Pay and discharge all taxes, assessments, and governmental charges upon it, its incomes, and its properties prior to the date on which penalties are attached thereto, unless and to the extent only that such taxes shall be contested in good faith and by appropriate proceedings by the Borrower, as applicable.

Insurance. Maintain insurance with insurance companies acceptable to the Lender on such investments and properties, in such amounts and against such risks as is customarily maintained by similar businesses operating within the same industry.

Maintenance. Maintain, preserve, and keep the investments or collateral in good standing and in safe-keeping condition.

Events of Default. The amounts due hereunder shall become immediately due and payable in full upon the occurrence of any one or more of the following events of default (the “Events of Default”).

	
  

	
a.

	
Default in the payment of the principal of the Loan when due and payable, whether at maturity or otherwise, that is not cured within 30 days; or

	
  

	
b.

	
Failure of Borrower to observe or perform any material term, covenant, or agreement contained in this Agreement that is not cured within 30 days, or the dissolution, termination of existence, or business failure of the Borrower.

Assignment. No portion of the Loan shall be assignable to a third party without the express written consent of the Borrower.

Miscellaneous

	
  

	
a.

	
This Agreement constitutes the entire agreement between the Borrower and the Lender. All computations and determinations of the assets and liabilities of Borrower the purpose of this Agreement shall be made in accordance with generally accepted accounting principles consistently applied, except as may be otherwise specifically provided herein. Any notice, request or other communication required or permitted hereunder shall be in writing and shall be deemed to have been duly given on the date of service if personally served on the party to whom such notice is to be given, on the date of transmittal of service via telecopy to the party to whom notice is to be given (with a confirming copy delivered within 24 hours thereafter), or on the third day after mailing if mailed to the party to whom notice is to be given, by first class mail, registered or certified mail, postage prepaid, or via a recognized overnight courier providing a receipt for delivery and properly addressed to the parties at the respective addresses of the parties as set forth herein. Any party hereto may by notice so given change its address for future notice hereunder.

  

  

  

	
  

	
b.

	
This Agreement shall be binding upon Borrower and their respective successors and assigns, and shall inure to the benefit of the Lenders and the benefit of their respective successors and assigns, including any subsequent holder or holders of the Notes or any interest therein.

Governing Law. The Laws of the State of Texas shall govern this Agreement.

Executed on the day and year below written. This Agreement may be executed in any number of counterparts, each constituting an original, but altogether one agreement. A facsimile or other copy of this Agreement shall be considered as having the same effect and be equivalent to an original signed document.

	
ContinuityX, Inc.

	 	
Gary Elliston

	 
	  	 	  	 
	
By:

	
/s/ Anthony G. Roth

	 	
By:

	/s/ Gary Elliston	 
	
Name:

	
Anthony G. Roth, Director

	 	  	
Gary Elliston

	 
	
Date:

	
June 17, 2011

	 	  	
Date: June 17, 2011Unassociated Document

CONSULTING AGREEMENT

THIS AGREEMENT, is made and entered into of the 5th day of July 2011 (the “Effective Date”), by and between Highland Global Partners, Inc., a New York corporation with its principal place of business at 25 Highland Boulevard, Dix Hills, New York 11746 (hereinafter referred to as “Consultant”), and ContinuityX, a Delaware corporation with its principal place of business located at 610 State Route 116, Suite C, Metamora, IL, 61548 (hereinafter referred to as “Corporation”, or “ContinuityX”).

WITNESSETH:

WHEREAS, the Corporation has requested that the Consultant provide services to the Corporation;

WHEREAS, the Consultant has agreed to provide services to the Corporation;

NOW, THEREFORE, in consideration of the premises, the mutual covenants of the parties herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each of the parties hereto, it is agreed as follows:

1.            CONSULTING ARRANGEMENT, the Corporation hereby contracts for the services of Consultant and Consultant agrees to perform such duties and responsibilities and to render advice and consulting as may be requested by the Corporation from time to time during the term of this consulting arrangement in connection with the Corporation’s business (“Consulting Arrangement”). Said consulting services shall include the Consultant introducing the Corporation to a Securities and Exchange Commission public reporting company (“Pubco”) for the purpose of a reverse acquisition of the Corporation by Pubco. The Corporation has allocated fifteen million (15,000,000) shares of the Corporation’s common stock, for such reverse acquisition into Pubco and for the Corporation’s contemplated $2-$3 million funding. The Consultant has agreed to use its best efforts to introduce the Corporation to potential investors and lending institutions for the purpose of obtaining capital to finance the business efforts of the Corporation. It is understood that there will be no fee for such introductions. In addition the Consultant agrees to assist the Corporation with the commercialization of its product(s).

2.            RELATIONSHIP BETWEEN PARTIES. During the term of the Consulting Arrangement, Consultant shall be deemed to be an independent contractor. Consultant shall not be considered as having an employee status vis-a-vis the Corporation, or by virtue of the Consulting Arrangement being entitled to participate in any plans, arrangements or distributions by the Corporation pertaining to or in connection with any pension, stock, bonus, profit sharing, welfare benefits, or similar benefits for the regular employees of the Corporation. The Corporation shall not withhold any taxes in connection with the compensation due Consultant hereunder, and Consultant will be responsible for the payment of any such taxes and hereby agrees to indemnify the Corporation against nonpayment thereof.

3.            COMPENSATION FOR THE CONSULTING ARRANGEMENT. As consideration for the services to be rendered by Consultant under this Consulting Arrangement and as compensation for the income it could have otherwise earned if it had not agreed to keep itself available to the Corporation hereunder, the Corporation will issue to the Consultant twenty-five million (25,000,000) shares of its common stock. The Corporation will have the option to cancel this Agreement as of December 31, 2011. In the event that the Corporation elects to cancel this Agreement as of December 31, 2011, the Consultant will be obligated to return seven million (7,000,000) shares of common stock of the twenty-five million (25,000,000) shares of common stock, that is to be issued to the Consultant under this Agreement, to the Corporation’s Treasury. Prior to this Agreement, there were forty-eight million (48,000,000) shares (post-split) of Corporation’s common stock outstanding (including eight million (8,000,000) shares to be allocated to three individuals who will serve as Directors of the Corporation). The Corporation does not have any (i) subscriptions, options, warrants, rights or other agreements outstanding to acquire from the Corporation shares of stock of the Corporation or any other equity security or security convertible into an equity security of the Corporation, or (ii) agreements or commitments to increase, decrease or otherwise after the authorized capital stock of the Corporation aside from the following performance bonus shares to be awarded to the Corporation’s Management upon the achievement of the following milestones:

  

 

  

	  	 	
Revenues

	 	 	
Common Stock Award

	 
	  	 	 	 	 	 	 
	
2012

	 	$	9,000,000	 	 	 	3,000,000	 
	  	 	 	 	 	 	 	 	 
	
2013

	 	$	15,000,000	 	 	 	3,000,000	 
	  	 	 	 	 	 	 	 	 
	
2014

	 	$	19,000,000	 	 	 	3,000,000	 
	  	 	 	 	 	 	 	 	 
	
2015

	 	$	23,000,000	 	 	 	3,000,000	 

The total number of shares that the Corporation shall have the authority to issue is two hundred fifty million (250,000,000) shares of common stock, having a par value of $0.00001 per share.

4.             TERM OF CONSULTING ARRANGEMENT. This Consulting Arrangement shall continue for a period of twelve (12) months from the date of this Agreement (the “Consulting Period”).

5.            CONFIDENTIALITY COVENANTS.

5.1           Agreements of the Consultant. In consideration of the compensation and benefits to be paid or provided to the Consultant by the Corporation under this Agreement, the Consultant covenants as follows:

Confidentiality.

	
(i)

	
During and following the Consulting Period, the Consultant will hold in confidence all Confidential Information and will not disclose Confidential Information to any person except with the specific prior written consent of the Corporation or except as otherwise expressly permitted by the terms of this Agreement.

	
(ii)

	
None of the foregoing obligations and restrictions applies to any part of the Confidential Information that the Consultant demonstrates was or became generally available to the public other than as a result of a disclosure by the Consultant.

	
(iii)

	
The Consultant will not remove from the Corporation’s premises (except to the extent such removal is for purposes of the performance of the Consultant’s duties) any document, record, notebook, plan, model, component, device, or computer software or code, whether embodied in a disk or in any other form (collectively, the “Proprietary Items”). The Consultant recognizes that, as between the Corporation and the Consultant, all of the Proprietary Items, whether or not developed by the Consultant, are the exclusive property of the Corporation. Upon termination of this Agreement by either party, or upon the request of the Corporation during the Consulting Period, the Consultant will return to the Corporation all of the Proprietary Items in the Consultant’s possession or subject to the Consultant’s control, and the Consultant shall not retain any copies, sketches, or other physical embodiment of any of the Proprietary Items.

 

  

2

  

5.2          Disputes or Controversies. The Consultant recognizes that should a dispute or controversy arising from or relating to this Agreement be submitted for adjudication to any court, arbitration panel, or other third party, the preservation of the secrecy of Confidential Information may be jeopardized. All pleadings, documents, testimony, and records relating to any such adjudication will be maintained in secrecy and will be available for inspection by the Corporation, the Consultant, and their respective attorneys and experts, who will agree, in advance and in writing, to receive and maintain all such information in secrecy, except as may be limited by them in writing.

5.3          Definitions.

For the purposes of this Section 5, “Confidential Information” shall mean any and all:

(i)            trade secrecy concerning the business and affairs of the Corporation, product specifications, data, knowhow designs, sketches, photographs, current, and planned research and development, current and planned manufacturing or distribution methods and processes, customer lists, current and anticipated customer requirements, price lists, market studies, business plans;

(ii)           information concerning the business and affairs of the Corporation (which includes historical financial statements, financial projections and budgets, historical and projected sales, capital spending budgets and plans, the names and backgrounds of key personnel, personnnel training and techniques and materials, however documented; and

(iii)           notes, analysis, compilations, studies, summaries, and other material prepared by or for the Corporation containing or based, in whole or in part, on any information included in the foregoing,

6.            NOTICES. All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when mailed by certified mail, return receipt requested or sent by a nationally recognized overnight delivery service (receipt requested), in each case to the appropriate addresses and facsimile numbers set forth:

(a)           if to the Corporation, to it at:

ContinuityX

5385 Hollister Avenue, Box 209, Santa Barbara, CA 93111

(b)           if to Consultant, to it at:

Highland Global Partners, Inc.

25 Highland Bouleyard

Dix Hills, New York 11746

7.            BINDING EFFECT. This Agreement shall extend to, shall inure to the benefit of and shall be binding upon all the parties hereto and upon all of their respective heirs, successors and representatives.

8.            ENTIRE AGREEMENT. This Agreement contains the entire agreement among the parties hereto with respect to the matters contemplated hereby and supersedes all prior agreements and undertakings between the parties with respect to such matters. This Agreement may not be amended, modified or terminated in whole or in part, except in writing, executed by both of the parties hereto,

  

3

  

9.            INDEMNIFICATION. Consultant and Corporation hereby agree to hold harmless and indemnify each other from and against any and all loss, damage, expense, and cost (including reasonable attorneys’ fees incurred in connection with the same) resulting to either of them from any material loss, liability, cost, damage, or expense which the other party may suffer, sustain or incur arising out of or due to a breach by the other of the representations, warranties and covenants set forth in any documents delivered pursuant to this Agreement or of a breach by the other of any of their respective obligations pursuant to this Agreement or in any documents delivered pursuant to this Agreement.

10.          SEVERABILITY. Should any part of any provision of this Agreement be declared invalid by a court of competent jurisdiction, such decision or determination shall not affect the validity of any remaining provision or any other provision and the remainder of the Agreement shall remain in full force and effect and shall be construed in all respects as if such invalid or unenforceable provision or portion thereof were not contained herein. In the event of a declaration of invalidity, the provision or portion thereof declared invalid shall not necessarily be invalidated in its entirety, but shall be observed and performed by the parties to the Agreement to the extent such provision is valid and enforceable.

11.          SECTION HEADINGS. The section headings contained herein are for convenience of reference only and shall not be considered any part of the terms of this Agreement.

12.          CHOICE OF LAW. This Agreement shall be interpreted and performed in accordance with the laws of the State of New York, and the parties agree, notwithstanding the principles of conflicts of law, that the internal laws of the State of New York shall govern and control the validity, interpretation, performance, and enforcement of this Agreement, The parties specifically designate the Courts in the County of New York and State of New York as properly having exclusive venue tor any action or proceeding with respect to this Agreement.

IN WITNESS WHEREOF, Consultant has hereunto put its hand, and the Corporation has caused this instrument to be executed in its corporate name by its duly authorized officer, all as of the day and year first above written.

	
CONSULTANT:

	  	
CORPORATION:

	  	  	  
	
HIGHLAND GLOBAL PARTNERS, INC.

	  	
CONTINUITYX

	  	  	  
	
By:

	/s/ Robert M. Rubin	  	
By:

	/s/ Anthony C. Roth
	  	  	  	  	  
	  	  	  	
By:

	/s/ David Godwin

 

  

4

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