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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported): July 18, 2023
KeyStar
Corp.
(Exact
name of registrant as specified in its charter)
| Nevada |
|
000-56290 |
|
85-0738656 |
(State
or other jurisdiction
of
incorporation) |
|
(Commission
File
Number) |
|
(I.R.S.
Employer
Identification
No.) |
| 78
SW 7th Street, Suite
500, Miami,
Florida |
|
33130 |
| (Address
of principal executive offices) |
|
(Zip
Code) |
Registrant’s
telephone number, including area code: (866) 783-9435
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
| ☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17CFR 230.425) |
| |
|
| ☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| |
|
| ☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act: None.
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| Item
1.01 |
Entry
into a Material Definitive Agreement. |
The
disclosures set forth in Items 2.03 and 3.02 are incorporated by reference into this Item 1.01.
| Item
2.03 |
Creation
of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
of a Registrant.
|
On
July 18, 2023, KeyStar Corp., a Nevada corporation (the “Company,” “we” or “our”),
entered into a Third Amended and Restated Discretionary Non-Revolving Line Of Credit Demand Note with Excel Family Partners, LLLP, a
Florida limited liability limited partnership (“Excel”) in the principal amount of not more than $5,000,000 (the “Note”).
The Note amends and restates that certain Second Amended and Restated Discretionary Non-Revolving Line Of Credit Demand Note between
us and Excel entered into on February 24, 2023 in the principal amount of not more than $4,000,000 (the “Former Note”).
Excel is controlled by Mr. Bruce Cassidy, our Secretary and sole member of our board of directors (the “Board”). The
Note does not constitute a committed line of credit. Loans under the Note are made by Excel in its sole and absolute discretion. Upon
repayment of any amount of principal or interest under the Note, we may not reborrow under the Note.
All
loans made under the Note accrue interest at a fixed rate per annum equal to 15.0% (the “Fixed Rate”). As of the date
of the Note, the aggregate outstanding principal balance of all loans was $3,851,876.51. On July 24, 2023, we borrowed an additional
$400,000 under the Note. As of July 24, 2023, the aggregate outstanding principal balance of all loans under the Note was $4,251,876.51.
On the first day of each month to the date on which Excel demands payment of the Note, we will pay to Excel interest, in arrears, on
the aggregate outstanding principal balance of the Note at the Fixed Rate.
Notwithstanding
the above, outstanding principal and accrued and unpaid interest are due and payable upon demand. We have the right to prepay the Note,
in whole or in part, at any time; provided, however, we must (i) provide Excel prior written notice of our intention to make such prepayment;
and (ii) pay to Excel all interest accrued on the outstanding principal balance of the Note to the date of such prepayment.
If
the Company: (i) fails to comply with any provision under the Note, including, but not limited to, failing to immediately pay all amounts
due to Excel after demand thereof is made; or (ii) becomes subject to certain bankruptcy or insolvency events, at the option of Excel,
the unpaid principal amount of the Note, accrued interest thereon, any fees or any other sums payable thereunder will thereafter until
paid in full bear interest at a rate per annum equal to the Fixed Rate plus 2.00%.
In
connection with entering into the Note, we issued Excel a Common Stock Warrant to purchase 1,000,000 shares of our common stock at an
exercise price of $0.25 per share (the “Warrant”). The Warrant may be exercised, in whole or in part, at any time
through July 17, 2028, on either a cash or cashless basis. The offer, sale and issuance of the Warrant were deemed to be exempt from
registration under the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) of
the Securities Act and/or Rule 506(b) of Regulation D promulgated thereunder, as transactions by an issuer not involving a public offering.
Excel is acquiring the Warrant for investment only and not with a view to or for sale in connection with any distribution thereof and
it represented to us that it could bear the risks of the investment and could hold the securities for an indefinite period of time, and
appropriate legends were, or will be, affixed to the Warrant upon issuance thereof. Excel represented to us that it is an accredited
investor within the meaning of Rule 501 of Regulation D under the Securities Act.
The
foregoing summary of the Note and the Warrant are qualified in their entirety by reference to the full text of the Note and the Warrant
which are attached as Exhibits 10.1 and Exhibit 4.1, respectively, hereto and are incorporated by reference herein. You are urged
to read said exhibits attached hereto in their entirety.
| Item
3.02 |
Unregistered
Sales of Equity Securities. |
The
disclosures set forth in Item 2.03 are incorporated by reference into this Item 3.02.
| Item 9.01 |
Financial Statements and Exhibits |
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
| Date:
July 24, 2023 |
KEYSTAR CORP. |
| |
|
|
| |
By: |
/s/
Anthony J. Fidaleo |
| |
|
Anthony
J. Fidaleo, CFO |
Exhibit
4.1
NEITHER
THIS WARRANT, NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF, HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT OF 1933”), OR QUALIFIED UNDER THE CALIFORNIA CORPORATE SECURITIES LAW OF 1968 OR OTHER APPLICABLE SECURITIES
LAWS (“STATE SECURITIES LAWS”), AND THIS WARRANT HAS BEEN, AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF, WILL BE, ACQUIRED
FOR INVESTMENT AND NOT WITH A VIEW TO, OR FOR RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF. NO SUCH SALE OR OTHER DISPOSITION
MAY BE MADE WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AND QUALIFICATION UNDER STATE SECURITIES LAWS
RELATED THERETO OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY (AS THAT TERM IS DEFINED BELOW) AND ITS COUNSEL, THAT
SAID REGISTRATION AND QUALIFICATION ARE NOT REQUIRED UNDER THE SECURITIES ACT OF 1933 AND STATE SECURITIES LAWS, RESPECTIVELY, OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT OF 1933.
KEYSTAR
CORP
COMMON
STOCK WARRANT
Aggregate
Exercise Price: $250,000.00
Aggregate
Exercisable Warrant Shares: 1,000,000
Issue
Date: July 18, 2023
Warrant
Number: CSW-003
This
certifies that Excel Family Partners, LLLP, a Florida limited liability limited partnership (“Investor”), or any party
to whom this Common Stock Warrant (this “Warrant”) is assigned in compliance with the terms hereof (Investor and any
such assignee being hereinafter sometimes referenced as “Holder”), is entitled to subscribe for and purchase the number
of shares of fully paid and nonassessable Warrant Stock (as such term is described below) of KeyStar Corp, a Nevada corporation (the
“Company”), that has an aggregate purchase price equal to the Aggregate Exercise Price (as defined below). The purchase
price of each such share of Warrant Stock shall be equal to the Warrant Exercise Price (as defined below). This Warrant may be exercised
during the period commencing upon the date first written above and ending on July 17, 2028.
ARTICLE
I
DEFINITIONS
1.1 “Aggregate
Exercise Price” means $250,000.00
1.2 “Change
of Control” means the consummation of: (a) a sale, transfer, exclusive license or other disposition, in one transaction or
a series of related transactions, of all or substantially all of the Company’s and its subsidiaries’ assets, taken as a whole
(except where such sale, transfer, license or other disposition is to a wholly-owned subsidiary of the Company); (b) the merger or consolidation
of the Company with or into another entity, except any merger or consolidation in which the holders of capital stock of the Company immediately
prior to such merger or consolidation continue to hold a majority of the voting power of the capital stock of the Company or the surviving
or acquiring entity, (or, if the surviving or acquiring entity is a wholly owned subsidiary of another party immediately following such
merger or consolidation, the parent entity of such surviving or acquiring entity); (c) the transfer (whether by merger, consolidation
or otherwise), in one transaction or a series of related transactions, to a person or group of affiliated persons (other than an underwriter
of the Company’s securities), of the Company’s securities if, after such consummation, such person or group of affiliated
persons would hold 50% or more of the outstanding voting stock of the Company (or the surviving or acquiring entity, or the parent entity
of such surviving or acquiring entity); or (d) a liquidation, voluntary or involuntary dissolution or winding up of the Company.
1.3 “Holder”
shall have the meaning set forth in the introductory paragraph of this Warrant.
1.4 “Investor”
shall have the meaning set forth in the introductory paragraph of this Warrant.
1.5 “Other
Stock” means the securities of the Company into which Warrant Stock may be converted pursuant to the terms of Warrant Stock,
which may include but not be limited to another class or series of common stock of the Company, but only if the terms of the Warrant
Stock provide for such conversion.
1.6 “Rights”
means any options, warrants, or rights to purchase common stock or convertible securities.
1.7 “Securities
Act” shall have the meaning set forth in the introductory paragraph of this Warrant.
1.8 “Warrant
Exercise Price” means $0.25.
1.9 “Warrant
Stock” means the Company’s Common Stock.
ARTICLE
II
EXERCISE
AND PAYMENT
2.1 Cash
Exercise. The purchase rights represented by this Warrant may be exercised by Holder, in whole or in part, by the surrender of this
Warrant at the principal office of the Company, accompanied by the form of Notice of Cash Exercise attached hereto as Exhibit A-1,
and by the payment to the Company, by wire transfer or by certified, cashier’s or other check acceptable to the Company, of an
amount equal to the aggregate Warrant Exercise Price (rounded up to the nearest whole cent) of the shares being purchased. If the Warrant
Stock issuable under this Warrant has been automatically converted into Other Stock, this Warrant shall automatically convert into a
right to purchase Other Stock, and the Warrant Exercise Price shall be divided by the number of shares of Other Stock which were received
upon conversion of one share of such Warrant Stock at the time of such automatic conversion.
2.2 Net
Issue Exercise. In lieu of exercising this Warrant pursuant to Section 2.1, this Warrant may be exercised in whole or in part by
Holder by surrender of this Warrant to the Company, accompanied by the form of Notice of Net Issue (Cashless) Exercise attached hereto
as Exhibit A-2. The number of shares Warrant Stock issuable upon the exercise shall be that having a value equal to the
net value of this Warrant, computed as of the date of surrender of this Warrant to the Company, using the following formula:
X
= Y(A-B)/A
Where:
| |
X |
= |
the
number of shares of Warrant Stock to be issued to Holder under this Section 2.2; |
| |
|
|
|
| |
Y |
= |
the
maximum number of shares of Warrant Stock purchasable upon cash exercise of this Warrant; |
| |
|
|
|
| |
A |
= |
the
fair market value per share of Warrant Stock at the date of exercise, as determined in accordance with Section 2.3, below; |
| |
|
|
|
| |
B |
= |
the
Warrant Exercise Price. |
2.3 Fair
Market Value in Net Issue Exercise. For purposes of Section 2.2, the fair market value per share of Warrant Stock shall be determined
by the Company’s Board of Directors (the “Board”) in good faith. In the case of Net Issue Exercise in connection
with and contingent upon the closing of the Company’s Initial Public Offering, the fair market value per share of Warrant Stock
shall be calculated by multiplying the gross offering price to the public (prior to deduction of underwriters’ discounts and expenses)
of a share of Other Stock by the number of shares of Other Stock into which each outstanding share of Warrant Stock then can be converted
or will be converted upon the offering.
2.4 Automatic
Conversion. If Warrant Stock has been automatically converted to Other Stock pursuant to the terms and conditions of the Warrant
Stock, then this Warrant shall automatically convert into a right to purchase Other Stock, pursuant to the formulas set forth in Sections
2.2 and 2.3 above, and the number of shares of the Company’s common stock to which Holder shall be entitled to purchase shall be
multiplied by that number of shares of Other Stock which were received upon conversion of one share of such Warrant Stock at the time
of such automatic conversion.
2.5 Stock
Certificates. In the event of any exercise of the rights represented by this Warrant, unless the Company’s common stock is
held in book-entry only form, in which case the Company’s transfer agent shall provide a statement of holdings, certificates for
the shares of Warrant Stock so purchased shall be delivered to Holder within a reasonable time and, unless this Warrant has been fully
exercised or has expired, a new Warrant representing the remaining unexercised portion hereof shall also be issued to Holder at such
time. Notwithstanding the date of the delivery of the certificate(s) for such Warrant Stock, the person in whose name the certificate(s)
for such Warrant Stock are to be issued shall be deemed to have become a stockholder of record on the next succeeding day on which the
transfer books are open after the date of the appropriate Notice of Exercise is received by the Company.
2.6 Stock
Fully Paid; Reservation of Shares. The Company covenants and agrees that all Warrant Stock which may be issued upon the exercise
of the rights represented by this Warrant (any Other Stock receivable upon any conversion of Warrant Stock) will, upon issuance, be fully
paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof (excluding taxes based on the income
of Holder). The Company further covenants and agrees that during the period within which the rights represented by this Warrant may be
exercised, the Company will at all times use its best efforts to have authorized and reserved for issuance a sufficient number of shares
of its Warrant Stock or other securities as would be required upon the full exercise of the rights represented by this Warrant.
2.7 Fractional
Shares. No fractional share of Warrant Stock will be issued in connection with any exercise hereof; in lieu of a fractional share
upon complete exercise hereof, Holder may purchase a whole share by delivering payment equal to the appropriate portion of the then effective
Warrant Exercise Price.
2.8 Automatic
Exercise. To the extent this Warrant is not previously exercised, and if the fair market value of one share of the Company’s
Warrant Stock issuable hereunder is greater than the Warrant Exercise Price, as adjusted, this Warrant shall be deemed automatically
exercised in accordance with Section 2.2 hereof (even if not surrendered) immediately before its expiration. For purposes of such automatic
exercise, the fair market value of one share of the Company’s Warrant Stock upon such expiration shall be the fair market value
determined pursuant to Section 2.3 above. To the extent this Warrant or any portion thereof is deemed automatically exercised pursuant
to this Section 2.8, the Company agrees to notify Holder within a reasonable period of time of the number of shares of the Company’s
Warrant Stock, if any, Holder is to receive by reason of such automatic exercise.
ARTICLE
III
CERTAIN
ADJUSTMENTS OF NUMBER OF
SHARES
PURCHASABLE AND WARRANT EXERCISE PRICE
The
number and kind of securities purchasable upon the exercise of this Warrant and the Warrant Exercise Price shall be subject to adjustment
from time to time upon the happening of certain events, as follows:
3.1 Reclassification,
Consolidation or Merger. In case of, after the Warrant Stock is determinable: (a) any reclassification or change of outstanding securities
issuable upon exercise of this Warrant; (b) any consolidation or merger of the Company with or into another corporation (other than a
merger with another corporation in which the Company is a continuing corporation and which does not result in any reclassification, change
or exchange of outstanding securities issuable upon exercise of this Warrant); or (c) any sale or transfer to another corporation of
all, or substantially all, of the assets of the Company, in each case which does not constitute a Change of Control, then, and in each
such event, the Company or such successor or purchasing corporation, as the case may be, shall execute a new Warrant of like form, tenor
and effect and which will provide that Holder shall have the right to exercise such new Warrant and purchase upon such exercise, in lieu
of each share of Warrant Stock theretofore issuable upon exercise of this Warrant, the kind and amount of securities, money and property
receivable upon such reclassification, change, consolidation, merger, sale or transfer by a holder of one share of Warrant Stock issuable
upon exercise of this Warrant had this Warrant been exercised immediately prior to such reclassification, change, consolidation, merger,
sale or transfer. Such new Warrant shall be as nearly equivalent in all substantive respects as practicable to this Warrant and the adjustments
provided in this Article III and the provisions of this Section 3.1, shall similarly apply to successive reclassifications, changes,
consolidations, mergers, sales and transfers.
3.2 Subdivision
or Combination of Shares. If the Company shall at any time while this Warrant remains outstanding and less than fully exercised:
(a) divide its Warrant Stock, the number of shares into which this Warrant shall be exercisable shall be proportionately increased and
the Warrant Exercise Price shall be proportionately reduced; or (b) shall combine shares of its Warrant Stock, the number of shares into
which this Warrant shall be exercisable shall be proportionately decreased and the Warrant Exercise Price shall be proportionately increased.
3.3 Adjustments
for Dividends in Stock or other Securities or Property. If while this Warrant, or any portion hereof, remains outstanding and less
than fully exercised Holders of the securities as to which purchase rights under this Warrant exist at the time shall have received,
or, on or after the record date fixed for the determination of eligible stockholders, shall have become entitled to receive, without
payment therefor, other or additional stock or other securities or property (other than cash) of the Company by way of dividend, then
and in each case, this Warrant shall represent the right to acquire, in addition to the number of shares of the security receivable upon
exercise of this Warrant, and without payment of any additional consideration therefor, the amount of such other or additional stock
or other securities or property (other than cash) of the Company which such holder would hold on the date of such exercise had it been
the holder of record of the security receivable upon exercise of this Warrant on the date hereof and had thereafter, during the period
from the date hereof to and including the date of such event, retained such shares and/or all such other additional stock during such
period, giving effect to all adjustments called for during such period by the provisions of this Section 3.3.
3.4 Time
of Adjustments to the Warrant Exercise Price. All adjustments to the Warrant Exercise Price and the number of shares purchasable
hereunder, unless otherwise specified herein, shall be effective as of the earlier of:
(a) the
effective date of a division or combination of shares; and
(b) the
record date of any action of holders of any class of the Company’s equity taken for the purpose of entitling holders of Warrant
Stock to receive a distribution or dividend payable in securities of the Company, provided that such division, combination, distribution
or dividend actually occurs.
3.5 Notice
of Adjustments. In each case of an adjustment in the Warrant Exercise Price and the number of shares purchasable hereunder, the Company,
at its expense, shall cause the Chief Financial Officer of the Company to compute such adjustment and prepare a certificate setting forth
such adjustment and showing in detail the facts upon which such adjustment is based. The Company shall mail a copy of each such certificate
to Holder pursuant to Section 6.7 hereof.
3.6 Duration
of Adjusted Warrant Exercise Price. Following each adjustment of the Warrant Exercise Price, such adjusted Warrant Exercise Price
shall remain in effect until a further adjustment of the Warrant Exercise Price.
3.7
Adjustment of Number of Shares. Upon each adjustment of the Warrant Exercise Price pursuant to this Article III, the number of
shares of Warrant Stock purchasable hereunder shall be adjusted to the nearest whole share, to the number obtained by dividing the
Aggregate Exercise Price by the Warrant Exercise Price as adjusted.
ARTICLE
IV
TRANSFER,
EXCHANGE AND LOSS
4.1 Transfers.
Subject to applicable law, this Warrant is transferable on the books of the Company at its principal office by the registered Holder
hereof upon surrender of this Warrant properly endorsed, subject to compliance with federal and state securities laws. The Company shall
issue and deliver to the transferee a new Warrant or Warrants representing the Warrants so transferred. Upon any partial transfer, the
Company will issue and deliver to Holder a new Warrant or Warrants with respect to the Warrants not so transferred, at Holder’s
cost and expense. Notwithstanding the foregoing, Holder shall not be entitled to transfer a number of shares or an interest in this Warrant
representing less than fifty percent (50%) of the Aggregate Exercise Price initially covered by this Warrant. Any transferee shall be
subject to the same restrictions on transfer with respect to this Warrant as the Investor.
4.2 Securities
Laws. If required by the Company, in connection with each issuance of shares of Warrant Stock upon exercise of this Warrant, Holder
will give: (a) assurances in writing, satisfactory to the Company, that such shares are being purchased solely for Holder’s own
account and not as a nominee for any other party, for investment and not with a view to the distribution thereof in violation of applicable
laws, (b) sufficient information, in writing, to enable the Company to rely on exemptions from the registration or qualification requirements
of applicable laws, if available, with respect to such exercise, and (c) its cooperation to the Company in connection with such compliance.
4.3 Exchange.
This Warrant is exchangeable at the principal office of the Company for Warrants which represent, in the aggregate, Holder’s rights
to purchase the number of shares of Warrant Stock at the Warrant Exercise Price, as set forth above, subject to adjustment from time
to time as set forth herein; each new Warrant to represent the right to purchase such portion thereof as Holder shall designate at the
time of such exchange. Each new Warrant shall be identical in form and content to this Warrant, except for appropriate changes in the
number of shares of Warrant Stock covered thereby and any other changes which are necessary in order to prevent the Warrant exchange
from changing the respective rights and obligations of the Company and Holder as they existed immediately prior to such exchange.
4.4 Loss
or Mutilation. Upon receipt by the Company of evidence satisfactory to it of the ownership of, and the loss, theft, destruction or
mutilation of, this Warrant and (in the case of loss, theft, or destruction) of indemnity satisfactory to it, and (in the case of mutilation)
upon surrender and cancellation hereof, the Company will execute and deliver in lieu hereof a new Warrant.
ARTICLE
V
HOLDER
RIGHTS
5.1 No
Stockholder Rights Until Exercise. No Holder hereof, solely by virtue hereof, shall be entitled to any rights as a shareholder of
the Company. Holder shall have all rights of a stockholder with respect to securities purchased upon exercise hereof as of the date set
forth in Section 2.5.
ARTICLE
VI
MISCELLANEOUS
6.1 Governmental
Approvals. The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits,
consents and approvals of governmental agencies and authorities and securities acts filings under federal and state laws, which may be
or become requisite in connection with the issuance, sale, and delivery of this Warrant, and the issuance, sale and delivery of the Warrant
Stock or other securities or property issuable or deliverable upon exercise of this Warrant.
6.2 Governing
Laws. This Warrant will be governed by and construed in accordance with the laws of the State of Nevada, excluding that body of laws
pertaining to conflict of laws. If any provision of this Warrant is determined by a court of law to be illegal or unenforceable, such
provision will be enforced to the maximum extent possible and the other provisions will remain effective and enforceable. If such clause
or provision cannot be so enforced, such provision shall be stricken from this Warrant, as applicable, and the remainder of this Warrant,
as applicable, shall be enforced as if such invalid, illegal or unenforceable clause or provision had (to the extent not enforceable)
never been contained in this Warrant, as applicable.
6.3 Binding
Upon Successors and Assigns. Subject to, and unless otherwise provided in, this Warrant, each and all of the covenants, terms, provisions,
and agreements contained herein shall be binding upon, and inure to the benefit of the permitted successors, executors, heirs, representatives,
administrators and assigns of the parties hereto.
6.4 Severability.
If any one or more provisions of this Warrant, or the application thereof, shall for any reason and to any extent be invalid or unenforceable,
the remainder of this Warrant and the application of such provisions to other persons or circumstances shall be interpreted so as best
to reasonably effect the intent of the parties hereto. The parties further agree to replace any such void or unenforceable provisions
of this Warrant with valid and enforceable provisions which will achieve, to the extent possible, the economic, business and other purposes
of the void or unenforceable provisions.
6.5 Amendments,
Waivers, Modifications. This Warrant may be amended only by a written agreement executed by each of the parties hereto. No amendment
of or waiver of, or modification of any obligation under this Warrant will be enforceable unless set forth in a writing signed by the
party against which enforcement is sought. Any amendment effected in accordance with this section will be binding upon all parties hereto
and each of their respective successors and assigns. The failure of any party to enforce any of the provisions hereof shall not be construed
to be a waiver of the right of such party thereafter to enforce such provision as to that or any other instance. No waiver granted under
this Warrant as to any one provision herein shall constitute a subsequent waiver of such provision or of any other provision herein or
therein, nor shall it constitute the waiver of any performance other than the actual performance specifically waived.
6.6 Attorneys’
Fees. Should suit be brought to enforce or interpret any part of this Warrant, the prevailing party shall be entitled to recover,
as an element of the costs of suit and not as damages, reasonable attorneys’ fees to be fixed by the court (including without limitation,
costs, expenses and fees on any appeal). The prevailing party shall be the party entitled to recover its costs of suit, regardless of
whether such suit proceeds to final judgment. A party not entitled to recover its costs shall not be entitled to recover attorneys’
fees. No sum for attorneys’ fees shall be counted in calculating the amount of a judgment for purposes of determining if a party
is entitled to recover costs or attorneys’ fees.
6.7 Notices.
Any notice, other communication or payment required or permitted hereunder shall be in writing and shall be deemed sufficient upon delivery,
when delivered personally or by overnight courier or sent by e-mail (upon written confirmation of receipt), or forty-eight (48) hours
after being deposited in the U.S. mail as certified or registered mail with postage prepaid, addressed to the party to be notified at
such party’s address as set forth on the signature page to this Warrant, as may be updated from time to time in accordance with
this Section 6.7.
6.8 No
Endorsement. Holder understands that no federal or state securities administrator has made any finding or determination relating
to the fairness of investment in the Company or purchase of the Warrant Stock hereunder and that no federal or state securities administrator
has recommended or endorsed the offering of securities by the Company hereunder.
6.9 Further
Assurances. The Company and Holder each agree to cooperate fully with the other and to execute such further instruments, documents
and agreements and to give such further written assurances, as may be reasonably requested by the other party to better evidence and
reflect the transactions described herein and contemplated hereby, and to carry into effect the intents and purposes of this Warrant.
INVESTOR
ACKNOWLEDGES THAT IT HAS BEEN ADVISED TO CONSULT ITS OWN TAX ADVISOR WITH SPECIFIC REFERENCE TO ITS OWN TAX SITUATION AND THE POTENTIAL
EFFECT OF APPLICABLE LAWS AND REGULATIONS. THE COMPANY HAS NOT AND DOES NOT PROVIDE ANY ADVICE CONCERNING ANY OF THE POTENTIAL TAX CONSIDERATIONS
AND CONSEQUENCES RELATING TO THE ACQUISITION, OWNERSHIP OR DISPOSITION OF THIS WARRANT OR THE WARRANT STOCK. IN ADDITION, THE COMPANY
HAS NOT OBTAINED, NOR DOES IT INTEND TO OBTAIN, A RULING FROM THE IRS OR AN OPINION OF COUNSEL WITH RESPECT TO ANY TAX CONSEQUENCES OF
ACQUIRING, OWNING OR DISPOSING OF THIS WARRANT OR THE WARRANT STOCK.
THE
COMPANY IS NOT RESPONSIBLE, NOR DOES IT DIRECTLY OR INDIRECTLY ASSUME RESPONSIBILITY, FOR THE TAX OR LEGAL CONSEQUENCES OF THIS WARRANT
OR THE TRANSACTION TO INVESTOR. INVESTOR SHOULD CONSULT ITS OWN TAX AND LEGAL ADVISORS AS TO THE PARTICULAR TAX AND LEGAL CONSEQUENCES
TO IT OF ACQUIRING, HOLDING OR DISPOSING OF THIS WARRANT OR THE WARRANT STOCK, INCLUDING THE EFFECT AND APPLICABILITY OF FEDERAL, STATE
AND LOCAL TAX LAWS.
IN
WITNESS WHEREOF, the parties hereto have executed this Common Stock Warrant as of the date first set forth above.
| |
KEYSTAR
CORP, a Nevada corporation |
| |
|
|
| |
By: |
/s/
Mark Thomas |
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|
Mark
Thomas, Chief Executive Officer |
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|
|
| |
Address: |
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78 SW 7th Street, Suite 800 |
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Miami, FL 33130 |
| |
|
|
| |
Agreed
to and Accepted By Investor: |
| |
|
| |
EXCEL
FAMILY PARTNERS, LLLP |
| |
|
|
| |
By: |
Fortress
Holdings, LLC, its General Partner |
| |
|
|
| |
By: |
/s/
Bruce A. Cassidy |
| |
|
Bruce
A. Cassidy, Manager |
| |
|
|
| |
Address: |
| |
103 Plaza Drive, Suite B |
| |
St. Clairsville, OH 43950 |
Exhibit
A-1
NOTICE
OF EXERCISE OF COMMON STOCK WARRANT
BY
CASH PAYMENT OF WARRANT EXERCISE PRICE
[Date]
| Keystar
Corp |
Aggregate
Exercise Price of Warrant Before Exercise: $ __________ |
| |
|
| Attention:
Chief Executive Officer |
Aggregate
Exercise Price Being Exercised: $ __________ |
| |
|
| |
Warrant
Exercise Price per share $ __________ |
| |
|
| |
Number
of Shares of Warrant Stock to be Issued Under this Notice: $ __________ |
| |
|
| |
Remainder
Aggregate Price (if any) After Issuance: $ __________ |
CASH
EXERCISE
Ladies
and Gentlemen:
The
undersigned registered Holder of the Common Stock Warrant delivered herewith (“Warrant”), hereby irrevocably exercises
such Warrant for, and purchases thereunder, shares of the Warrant Stock of Keystar Corp, a Nevada corporation, as provided below. Capitalized
terms used herein, unless otherwise defined herein, shall have the meanings given in the Warrant. The portion of the Aggregate Exercise
Price (as defined in the Warrant) to be applied toward the purchase of Warrant Stock pursuant to this Notice of Exercise is $____, thereby
leaving a remainder Aggregate Exercise Price (if any) equal to $____. Such exercise shall be pursuant to the cash exercise provisions of
Section 2.1 of the Warrant. Therefore, Holder makes payment with this Notice of Exercise by way of check payable to the Company in the
amount of $_____. Such check is payment in full under the Warrant for shares of Warrant Stock based upon the Warrant Exercise Price as
currently in effect under the Warrant. Holder requests that the shares of Warrant Stock be issued in the name of ________________ and
delivered to ______________________.
To
the extent the foregoing exercise is for less than the full Aggregate Exercise Price, a Replacement Warrant representing the remainder
of the Aggregate Exercise Price and otherwise of like form, tenor and effect should be delivered to Holder along with the share certificates
evidencing the Warrant Stock issued in response to this Notice of Exercise.
Exhibit
A-2
NOTICE
OF EXERCISE OF COMMON STOCK WARRANT
PURSUANT
TO NET ISSUE (“CASHLESS”) EXERCISE PROVISIONS
[Date]
| Keystar
Corp |
Aggregate
Exercise Price of Warrant Before Exercise: $ __________ |
| |
|
| Attention:
Chief Executive Officer |
Aggregate
Exercise Price Being Exercised: $ __________ |
| |
|
| |
Warrant
Exercise Price per share $ __________ |
| |
|
| |
Number
of Shares of Warrant Stock to be Issued Under this Notice: $ __________ |
| |
|
| |
Remainder
Aggregate Price (if any) After Issuance: $ __________ |
CASHLESS
EXERCISE
Ladies
and Gentlemen:
The
undersigned, registered Holder of the Common Stock Warrant delivered herewith (“Warrant”), hereby irrevocably exercises
such Warrant for, and purchases thereunder, shares of the Warrant Stock of Keystar Corp, a Nevada corporation, as provided below. Capitalized
terms used herein, unless otherwise defined herein, shall have the meanings given in the Warrant. The portion of the Aggregate Exercise
Price (as defined in the Warrant) to be applied toward the purchase of Warrant Stock pursuant to this Notice of Exercise is $_____, thereby
leaving a remainder Aggregate Exercise Price (if any) equal to $_____. Such exercise shall be pursuant to the net issue exercise provisions
of Section 2.2 of the Warrant; therefore, Holder makes no payment with this Notice of Exercise. The number of shares to be issued pursuant
to this exercise shall be determined by reference to the formula in Section 2.2 of the Warrant which, by reference to Section 2.3, requires
the use of the current per share fair market value of the Company’s Warrant Stock. The current fair market value of one share of
the Company’s Warrant Stock shall be determined in the manner provided in Section 2.3, which amount has been determined or agreed
to by Holder and the Company to be $______, which figure is acceptable to Holder for calculations of the number of shares of Warrant
Stock issuable pursuant to this Notice of Exercise. Holder requests that the shares of Warrant Stock be issued in the name of ________________
and delivered to ________________________. To the extent the foregoing exercise is for less than the full Aggregate Exercise Price of
the Warrant, a replacement Warrant representing the remainder of the Aggregate Exercise Price (and otherwise of like form, tenor and
effect) shall be delivered to Holder along with the share certificate evidencing the Warrant Stock issued in response to this Notice
of Exercise.
Exhibit
10.1
THIRD
AMENDED AND RESTATED
DISCRETIONARY
CONVERTIBLE NON-REVOLVING LINE OF CREDIT DEMAND NOTE
| $5,000,000.00 |
Sarasota,
Florida |
| |
Dated
as of July 18, 2023 |
FOR
VALUE RECEIVED, and intending to be legally bound hereby, KEYSTAR CORP, a Nevada corporation (the “Maker”), hereby
promises to pay ON DEMAND to the order of EXCEL FAMILY PARTNERS, LLLP, a Florida limited liability limited partnership (the “Lender”),
the lesser of (i) the principal sum of Five Million Dollars ($5,000,000.00) (the “Loan Amount”) or (ii) the aggregate
unpaid principal balance of the Non-Revolving Credit Loans (as hereinafter defined) made by the Lender to the Maker from time to time,
as may be evidenced by inscriptions made on Schedule 1 hereto, or as may be entered in a loan account on the Lender’s books
and records, or both (together will all extensions, renewals, refinancing or refundings in whole or in part, as amended, modified or
supplemented from time to time, this “Note”), together with interest thereon at the rate or rates specified herein,
as follows:
| |
1. |
Non-Revolving Credit Loan Facility. |
(a) The
Non-Revolving Credit Loans. Subject to the terms and conditions hereof and relying upon the representations and warranties set forth
in this Note, the Lender has made a loan (each, a “Non-Revolving Credit Loan” and collectively, the “Non-Revolving
Credit Loans”) to the Maker at any time or from time to time in an aggregate principal amount which will not exceed the Loan
Amount.
(b) Nature
of the Non-Revolving Credit Loans. Upon repayment of any amount of principal or interest of the Non-Revolving Credit Loans by the
Maker, the Maker may not reborrow under this Note.
(c) Making
the Non-Revolving Credit Loans. Subject to the terms and conditions set forth in this Note, and provided that the Maker has satisfied
all applicable conditions specified herein, the Lender, in its sole and absolute discretion, will make the Non-Revolving Credit Loans
to the Maker.
(d)
DISCRETIONARY ADVANCES. This Note does not constitute a committed line of credit.
Non-Revolving Credit Loans under this Note, if any, shall be made by the Lender in its sole and absolute discretion. Nothing contained
in this Note shall be construed to obligate the Lender to make any Non-Revolving Credit Loan in any amount and the Lender shall have
the right to refuse to make any Non-Revolving Credit Loan at any time without prior notice to the Maker.
(e) Maximum
Principal Balance of Non-Revolving Credit Loans. The aggregate principal amount of the Non-Revolving Credit Loans outstanding will
not at any time exceed the Loan Amount. The Maker agrees that if at any time the aggregate principal amount of the Non-Revolving Credit
Loans outstanding exceeds the Loan Amount (the “Excess Amount”), the Maker will promptly pay to the Lender such Excess
Amount.
(f) Use
of Proceeds. Non-Revolving Credit Loans may be subject to restricted uses from time to time, at the sole and absolute discretion
of the Lender. Lender may provide written instructions (instructions via email are permitted) to Maker regarding restrictions on the
use of the Non-Revolving Credit Loans. Absent such instructions from the Lender, the Maker may use the Non-Revolving Credit Loans for
(i) general company purposes and/or (ii) any other use approved in writing by the Lender, in its sole and absolute discretion.
(g) Outstanding
Principal Balance of Non-Revolving Credit Loans. All advances of principal made on this Note may be inscribed by the Lender on Schedule
1 hereto in the Lender’s discretion or entered on the Lender’s books and records. Each inscription or entry shall be
prima facie evidence of the facts so set forth. No failure by the Lender to make, and no error by the Lender in making, any inscription
on Schedule 1 shall affect the Maker’s obligation to repay the full principal amount advanced by the Lender to or for the
account of the Maker, or the Maker’s obligation to pay interest thereon at the agreed upon rate.
(a) Interest.
Subject to the terms and conditions of this Note, the aggregate outstanding principal balance of the Non-Revolving Credit Loans will
bear interest at a fixed rate per annum equal to 15.0% (the “Fixed Rate”). Interest on Non-Revolving Credit Loans,
unpaid fees and other sums payable hereunder will be computed on the basis of a year of 365 days and paid for the actual number of days
elapsed.
(b) Interest
After Default. If the Maker (i) fails to comply with any provision hereunder, including, but not limited to, failing to immediately
pay all amounts due hereunder to the Lender after demand thereof is made, or (ii) becomes subject to any event described in Section
8 hereof, at the option of the Lender, the unpaid principal amount of the Non-Revolving Credit Loans or any portion thereof, accrued
interest thereon, any fees or any other sums payable hereunder will thereafter until paid in full bear interest at a rate per annum equal
to the Fixed Rate plus 2.00%.
| |
3. | Description
of Payments. |
(a) Payments
of Interest. On the first day of each month to the date on which Lender demands payment of this Note, the Maker will pay to the Lender
interest, in arrears, on the aggregate outstanding principal balance of the Non-Revolving Credit Loans at the Fixed Rate.
(b) Payments
of Principal. If not sooner paid, the entire principal balance of all outstanding Non-Revolving Credit Loans, together with all unpaid
accrued interest thereon, and all other sums and costs owed to the Lender by the Maker with respect to the Non-Revolving Credit Loans
will be immediately due and payable ON DEMAND, without presentment, protest or notice or further demand of any kind, all of which
are hereby waived and an action therefore shall accrue immediately.
(c) Optional
Prepayments. The Maker will have the right to prepay the Non-Revolving Credit Loans, in whole or in part, at any time; provided,
however, the Maker must (i) provide the Lender prior written notice of the Maker’s intention to make such prepayment and (ii) pay
to the Lender all interest accrued on the outstanding principal balance of the Non-Revolving Credit Loans to the date of such prepayment
and all other fees, costs and charges required to be paid by the Maker to and for the benefit of the Lender.
(d) Payments.
All payments (and to the extent the Maker determines to make any prepayments) to be made in respect of principal, interest, fees or other
amounts due from the Maker under this Note will be payable on or before 5:00 p.m. (Eastern Time) on the day when due without presentment,
further demand, protest or notice of any kind, all of which are hereby expressly waived. Payments made after 5:00 p.m. (Eastern Time)
shall be deemed to be made on the next Business Day. All such payments must be made to the Lender at its designated address in lawful
money of the United States of America in immediately available funds without setoff, counterclaim or other deduction of any nature. Subject
to the terms and conditions of this Note, all such payments will be applied at the option of the Lender to accrued and unpaid interest,
outstanding principal and other sums due under this Note in such order as the Lender may elect. All such payments will be made absolutely
net of, without deduction or offset, and altogether free and clear of any and all present and future taxes, levies, deductions, charges
and withholdings and all liabilities with respect thereto, excluding income taxes imposed on the Lender under the Laws (as hereinafter
defined) of the United States or any state or political subdivision thereof.
(a) Right
to Convert. The Lender may, at its sole option, convert all or any portion of the Debt (as hereinafter defined) into fully paid and
non-assessable shares of common stock of the Maker (the “Shares”) at a conversion price in an amount equal to the
product of the Lowest Recent Price (as hereinafter defined) multiplied by 80% (such amount is referred to as the “Conversion
Price”). The number of Shares to be issued upon each conversion of the Debt shall be determined by dividing the Conversion
Amount (as hereinafter defined) by the applicable Conversion Price then in effect on the date specified in a notice of conversion (“Conversion
Notice”) given by Lender, delivered to Maker by Lender on such conversion date (the “Conversion Date”).
Promptly after receipt of a Conversion Notice, the Maker shall provide evidence in form and substance acceptable to the Lender in its
sole discretion, that the conversion of such Debt into Shares has occurred.
(b)
Adjustments for Reclassification and Reorganization. In case of any reclassification, capital reorganization, or other change
of outstanding Shares, or in case of any consolidation or merger of the Maker with or into another entity (other than a consolidation
or merger in which the Maker is the continuing company and which does not result in any reclassification, capital reorganization, or
other change of outstanding Shares), the Maker shall cause effective provision to be made so that the Lender shall have the right thereafter,
by converting the Debt, to receive upon such conversion the kind and number of shares of stock or other securities or property (including
cash) receivable upon such reclassification, capital reorganization, or other change, consolidation or merger by a holder of the number
of Shares that could have been received upon conversion of the Debt immediately prior to such reclassification, capital reorganization,
or other change, consolidation or merger. Any such provision shall include provision for adjustments that shall be as nearly equivalent
as may be practicable to the adjustments provided for in this Section 4. The foregoing provisions shall similarly apply to successive
reclassifications, capital reorganizations, and other changes of outstanding shares and to successive consolidations or mergers. If the
consideration received by the holders of Shares is other than cash, the value shall be as determined by the board of directors of the
Maker acting in good faith.
(c) Adjustment
for Stock Splits. If and whenever the Maker shall declare or cause a stock split, a stock combination, or a reverse stock split of
the Shares, the number of Shares into which the Debt may be converted and the Conversion Price shall be proportionately adjusted in the
manner determined by the Maker’s board of directors acting in good faith. The number of Shares into which the Debt may be converted,
as so adjusted, shall be rounded down to the nearest whole number and the Conversion Price shall be rounded to the nearest cent.
5. Representations
and Warranties. The Maker represents and warrants to the Lender that: (i) it is duly organized, validly existing and in good standing
under the Laws of the jurisdiction of its formation, and is in good standing and registered to conduct business in all other jurisdictions
in which any such failure would materially and adversely affect its ability to perform its obligations hereunder, (ii) the Maker has
full power, authority and legal right to enter into this Note and the other Loan Documents and to perform all of its respective obligations
hereunder and thereunder and (iii) this Note and the other Loan Documents have been duly executed and delivered by the Maker, and this
Note and the other Loan Documents constitute the legal, valid and binding obligation of the Maker enforceable in accordance with their
terms, except as such enforceability may be limited by any applicable bankruptcy, insolvency, moratorium or similar Laws affecting creditors’
rights generally.
| |
6. |
Affirmative Covenants. The Maker covenants and agrees
with the Lender as follows: |
(a) Notice
of Breach. Promptly upon becoming aware of any failure of the Maker to comply with any provision hereunder, the Maker will give the
Lender notice thereof, together with a written statement signed on behalf of the Maker setting forth the details of such failure and
any action taken or contemplated to be taken by the Maker with respect thereto.
(b) Further
Information. The Maker will promptly furnish, or will cause to be promptly furnished, to the Lender such other information, and in
such form, as the Lender may reasonably request from time to time.
(c) Further
Assurances. The Maker, at the Maker’s own cost and expense, will cause to be promptly and duly taken, executed, acknowledged
and delivered all such further acts, documents and assurances as the Lender may reasonably request from time to time in order to carry
out the intent and purposes of this Note and the transactions contemplated by this Note.
(d) Other
Conditions. Concurrently herewith, the Maker will deliver such other documents and satisfy such other conditions as may be reasonably
required to be delivered or satisfied by the terms of this Note and/or any other Loan Document.
| |
7. |
Negative Covenants. The Maker covenants to the Lender
as follows: |
(a) Liens.
The Maker will not at any time create, incur, assume or permit to exist any Lien on or any of its assets without the prior written consent
of Lender, which consent may be given or withheld in Lender’s sole discretion.
(b) Indebtedness.
The Maker will not, at any time, create, incur, assume or suffer to exist any Indebtedness (as hereinafter defined) without the Lender’s
prior written consent, except:
(i) Indebtedness
under this Note or any other Loan Document or any other document, instrument or agreement between the Maker and the Lender; and
(ii) current
accounts payable, accrued expenses and other expenses arising out of transactions (other than borrowing) in the ordinary course of business.
(c) Disposition
of Assets. Except as set forth in this Note and/or any other Loan Document, the Maker will not sell, convey, pledge, assign, abandon,
transfer or dispose of, voluntarily or involuntarily, any of its assets without the Lender’s prior written consent.
(d) Dividends
and Distributions. The Maker will not make, cause, permit or allow the payment of any dividends or distributions to any member of
Maker without the Lender’s prior written consent.
| |
8. |
Bankruptcy/Insolvency. |
(a) If
a proceeding shall have been instituted in respect of the Maker:
(i) seeking
to have an order for relief entered in respect of or seeking a declaration or entailing a finding that the Maker is insolvent or a similar
declaration or finding, or seeking dissolution, winding-up, charter revocation or forfeiture, liquidation, reorganization, arrangement,
adjustment, composition or other similar relief with respect to the Maker, his assets or debts under any Law relating to bankruptcy,
insolvency, relief of debtors or protection of creditors, termination of legal entities or any other similar Law now or hereafter in
effect and said proceeding or order is not dismissed, vacated or stayed within sixty (60) days of his commencement or entry; or
(ii) seeking
appointment of a receiver, trustee, custodian, liquidator, assignee, sequestrator or other similar official for the Maker or for all
or any substantial part of his property; or
(b) if
the Maker shall become insolvent, shall become generally unable to pay his debts as they become due, shall voluntarily suspend transaction
of his businesses, shall make a general assignment for the benefit of creditors, shall institute a proceeding described in Section
8(a)(i) or shall consent to any such order for relief, declaration, finding or relief described therein, shall institute a proceeding
described in Section 8(a)(ii) of this Note or shall consent to any such appointment or to the taking of possession by any such
official of all or any substantial part of his property whether or not any proceeding is instituted, shall dissolve, wind-up or liquidate
any substantial part of his properties, or shall take any action in furtherance of any of the foregoing.
THEN,
IN ADDITION TO THE LENDER’S UNQUALIFIED RIGHT TO DEMAND PAYMENT OF THE OUTSTANDING AGGREGATE PRINCIPAL BALANCE AND ALL ACCRUED
INTEREST ON THE LOAN, the unpaid principal amount of this Note, interest accrued on the unpaid principal amount and all other amounts
owing by the Maker under this Note shall automatically become immediately due and payable without presentment, demand, protest or notice
of any kind, all of which are expressly waived, and an action for any amounts due shall accrue immediately.
9. Remedies
Cumulative. The rights and remedies of the Lender will be cumulative and may be pursued singly, concurrently, or successively in
the Lender’s sole discretion, and may be exercised as often as necessary; and the failure to exercise any such right or remedy
will in no event be construed as a waiver or release of the same.
10. Definitions. As used herein:
(a) “Affiliate”
of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is
under common control with, such Person; and (y) the term “control” (including the terms “controlled by” and “under
common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by contract or otherwise
(b) “Business
Day” will mean any day which is neither a Saturday or Sunday nor a legal holiday on which commercial banks are authorized or
required to be closed in Sarasota, Florida.
(c) “Closing
Date” will mean as of July 18, 2023.
(d) “Conversion
Amount” means, with respect to any conversion of the Debt, the sum of (i) the principal amount of this Note to be converted
in such conversion plus (ii) at the Lender’s option, accrued and unpaid interest, if any, on such principal amount to the Conversion
Date.
(e) “Conversion
Date” will mean that as set forth in Section 4(a) hereof.
(f) “Conversion
Notice” will mean that as set forth in Section 4(a) hereof.
(g) “Conversion
Price” will mean that as set forth in Section 4(a) hereof.
(h) “Debt”
will mean, collectively, (A) all indebtedness, whether of principal, interest, fees, expenses or otherwise, of the Maker to the Lender,
whether now existing or hereafter incurred including, but not limited to, future loans and advances, if any, under this Note, as the
same may be amended from time to time, together with any and all extensions, renewals, refinancings or refundings thereof in whole or
in part, and (B) all costs and expenses including, without limitation, to the extent permitted by Law, reasonable attorneys’ fees
and legal expenses, incurred by the Lender in the collection of any of the indebtedness referred to in clause (A) above in amounts due
and owing to the Lender under this Note.
(i) “Excess
Amount” will mean that as set forth in Section 1(e) hereof.
(j) “Existing
Note” will mean that as set forth in Section 13(l) hereof.
(k) “Fixed
Rate” will mean that as set forth in Section 2(a) hereof.
(l) “Indebtedness”
will mean, all obligations for borrowed money, direct or indirect, incurred, assumed or guaranteed (including, without limitation, all
notes payable and drafts accepted representing the Loan Amount).
(m) “Law”
or “Laws” will mean, singularly or collectively, as the context may require, any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or award of any Official Body.
(n) “Lender”
will mean that as set forth in the preamble hereof.
(o) “Lien”
will mean any mortgage, deed of trust, pledge, lien, security interest, charge or other encumbrance or security arrangement of any nature
including, but not limited to, any conditional sale or title retention arrangement, and any assignment, deposit arrangement or lease
intended as, or having the effect of, security for Indebtedness.
(p) “Loan
Amount” will mean that as set forth in the preamble hereof.
(q) “Loan
Document” or “Loan Documents” will mean, singularly or collectively, as the context may require, (i) this
Note and (ii) any and all other documents, instruments, certificates and agreements executed and delivered in connection with this Note,
as any of them may be amended, restated, modified or supplemented from time to time.
(r) “Lowest
Recent Price” means, as of each applicable Conversion Date, the lowest price per Share that Company has sold one or more Shares
to an investor or lender within the 24-month period prior to the applicable Conversion Date; provided, however, that if no Shares were
sold within such 24-month period, the Lowest Recent Price will be $0.50 per Share.
(s) “Maker”
will mean that as set forth in the preamble hereof.
(t) “Non-Revolving
Credit Loan” or “Non-Revolving Credit Loans” will mean that as set forth in Section 1(a) hereof.
(u) “Note”
will mean that as set forth in the preamble hereof.
(v) “Notices”
will mean that as set forth in Section 13(f) hereof.
(w) “Official
Body” will mean any government or political subdivision or any agency, authority, bureau, central bank, board, commission,
department or instrumentality of either, or any court, tribunal, grand jury or arbitrator, in each case whether foreign or domestic.
(x) “Person”
will mean an individual, corporation, partnership, limited liability company, joint venture, trust or unincorporated organization, or
a government or any agency or political subdivision thereof.
(y) “Shares”
will mean that as set forth in Section 4(a) hereof.
11. Construction.
Unless the context of this Note otherwise clearly requires, references to the plural includes the singular, the singular the plural,
the part the whole and “or” has the inclusive meaning represented by the phrase “and/or”. References in this
Note to “judgments” of the Lender include good faith estimates by the Lender (in the case of quantitative judgments) and
good faith beliefs by the Lender (in the case of qualitative judgments). The definition of any document or instrument includes all schedules,
attachments, and exhibits thereto and all renewals, extensions, supplements, restatements and amendments thereof. “Hereunder”,
“herein”, “hereto”, “hereof”, “this Note” and words of similar import refer to this entire
document; “including” is used by way of illustration and not by way of limitation, unless the context clearly indicates to
the contrary; and any action required to be taken by the Maker is to be taken promptly, unless the context clearly indicates to the contrary.
12. Duration;
Survival. All representations and warranties of the Maker contained in this Note or the Loan Documents will survive the making of
and will not be waived by the execution and delivery of this Note or the Loan Documents, by any investigation by the Lender, or by the
making of the Non-Revolving Credit Loans. Notwithstanding termination of this Note, all covenants and agreements of the Maker will continue
in full force and effect from and after the date of this Note until payment in full of this Note, interest thereon, and all fees and
other obligations of the Maker under this Note.
13. Miscellaneous.
(a) This
Note evidences the Non-Revolving Credit Loans and evidences all other amounts payable by the Maker hereunder.
(b) Except
as otherwise provided in this Note, whenever any payment or action to be made or taken under this Note is stated to be due on a day which
is not a Business Day, such payment or action will be made or taken on the next following Business Day and such extension of time will
be included in computing interest or fees, if any, in connection with such payment or action.
(c) The
Lender and the Maker may from time to time enter into agreements amending, modifying or supplementing this Note or changing the rights
of the Lender or of the Maker under this Note and the Lender may from time to time grant waivers or consent to a departure from the due
performance of the obligations of the Maker under this Note. Any such agreement, waiver or consent must be in writing and will be effective
only to the extent specifically set forth in such writing. An agreement to increase the Loan Amount stated herein may be made by a separate
written instrument or by an email exchange between the authorized representatives of the Lender and Maker who execute this Note if the
increased amount is specifically stated and is ten percent (10%) or less than the Loan Amount stated herein. In the case of any waiver
or consent relating to any provision of this Note, any failure to comply with any provision of this Note so waived or consented to will
be deemed to be cured and not continuing, but no such waiver or consent will extend to any other or subsequent failure to comply with
any provision of this Note or impair any right consequent thereto.
(d) This
Note may not be assigned or transferred by the Lender without the written consent of the Maker, which consent shall not be unreasonably
withheld, conditioned or delayed. This Note shall inure to the benefit of and be binding upon the parties hereto and their permitted
assigns.
(e) No
course of dealing and no delay or failure of Lender in exercising any right, power or privilege under this Note will affect any other
or further exercise thereof or exercise of any other right, power or privilege except as and to the extent that the assertion of any
such right, power or privilege will be barred by an applicable statute of limitations; nor will any single or partial exercise of any
such right, power or privilege or any abandonment or discontinuance of steps to enforce such a right, power or privilege preclude any
further exercise thereof or of any other right, power or privilege. The rights and remedies of the Lender under this Note are cumulative
and not exclusive of any rights or remedies that the Lender would otherwise have.
(f) All
notices, requests, demands, directions and other communications (collectively “Notices”) under the provisions of this
Note must be in writing (including telexed or telecopied communication) unless otherwise expressly permitted under this Note and must
be sent by first-class or first-class express mail, private overnight or next Business Day courier or by telex or telecopy with confirmation
in writing mailed first class, in all cases with charges prepaid, and any such properly given Notice will be effective when received.
All Notices will be sent to the applicable party at the addresses stated below or in accordance with the last unrevoked written direction
from such party to the other parties.
| |
Maker: |
KEYSTAR CORP |
| |
|
78 SW 7th Street, Suite 800 |
| |
|
Miami, FL 33130 |
| |
|
Attention: Chief Executive Officer |
| |
|
|
|
| |
|
and
copy to: |
Clark
Hill PLC |
| |
|
|
14850
N, Scottsdale Road, Suite 500 |
| |
|
|
Scottsdale,
Arizona 85254 |
| |
|
|
Attention:
Daniel A. Schenck, Esquire |
| |
|
|
|
| |
Lender: |
EXCEL FAMILY PARTNERS, LLLP |
| |
|
1285 N. Palm Ave. |
| |
|
Sarasota, Florida 34236 |
| |
|
Attention: Bruce Cassidy |
| |
|
|
|
| |
|
and
copy to: |
Clark
Hill PLC |
| |
|
|
One
Oxford Centre, 14th Floor |
| |
|
|
Pittsburgh,
Pennsylvania 15219 |
| |
|
|
Attention:
Jeffrey J. Conn, Esquire |
(g) The
provisions of this Note are intended to be severable. If any term or provision of this Note, or the application thereof to any Person
or circumstance, will to any extent be invalid or unenforceable, the remainder of this Note, or the application of such term or provision
to Persons or circumstances other than those as to which it is invalid or unenforceable, will not be affected thereby, and each term
and provision of this Note will be valid and enforceable to the fullest extent permitted by Law.
(h) This
Note will be deemed to be a contract under the Laws of the State of Florida and for all purposes will be governed by and construed and
enforced in accordance with the substantive Laws, and not the laws of conflicts, of said State. The Maker consents to the exclusive jurisdiction
and venue of the federal and state courts located in Sarasota County, Florida, in any action on, relating to or mentioning this Note,
the other Loan Documents or any one or more of them.
(i) This
Note and the other Loan Documents supersede all prior understandings and agreements, whether written or oral, among the parties relating
to the transactions provided for in this Note and the other Loan Documents.
(j) This
Note may not be amended, modified or supplemented orally.
(k) This
obligation will bind the Maker and its successors and assigns, and the benefits hereof will inure to the Lender and its successors and
assigns, except that the Maker may not assign or transfer any of its rights under this Note.
(l) This
Note amends and restates that certain Second Amended and Restated Discretionary Non-Revolving Line of Credit Demand Note, dated February
24, 2023, issued by the Maker to the Lender in the original principal amount of Four Million Dollars ($4,000,000.00) (the “Existing
Note”). This Note is issued in substitution for the Existing Note and is not a novation thereof.
(m) WAIVER
OF TRIAL BY JURY. THE MAKER AND THE LENDER HEREBY EXPRESSLY, KNOWINGLY AND VOLUNTARILY WAIVE ALL BENEFIT AND ADVANTAGE OF ANY SUCH
RIGHT TO A TRIAL BY JURY, AND NEITHER WILL AT ANY TIME INSIST UPON, OR PLEAD OR IN ANY MANNER WHATSOEVER CLAIM OR TAKE THE BENEFIT OR
ADVANTAGE OF A TRIAL BY JURY IN ANY ACTION ARISING IN CONNECTION WITH THIS NOTE OR ANY OF THE OTHER LOAN DOCUMENTS.
(n) DEMAND.
THE MAKER ACKNOWLEDGES THAT THE NON-REVOLING CREDIT LOANS ARE PAYABLE ON DEMAND AND THAT NOTWITHSTANDING ANYTHING TO THE CONTRARY IN
THIS NOTE, NOTHING IN THIS NOTE, INCLUDING WITHOUT LIMITATION THE ENUMERATION IN THIS NOTE OF SPECIFIC CONDITIONS OR COVENANTS RELATING
TO THE NON-REVOLING CREDIT LOANS, SHALL BE CONSTRUED TO QUALIFY, DEFINE OR OTHERWISE LIMIT IN ANY WAY THE LENDER’S UNRESTRICTED
RIGHT, POWER AND ABILITY, AT ANY TIME, AND FROM TIME TO TIME, TO DEMAND THE PAYMENT OF THE AGGREGATE OUTSTANDING BALANCE OF, AND ALL
ACCRUED INTEREST ON, THE NON-REVOLING CREDIT LOANS, AND THE MAKER AGREES THAT THE FAILURE TO COMPLY WITH ANY CONDITION, COVENANT OR OTHER
PROVISION OF THIS NOTE IS NOT THE ONLY BASIS FOR A DEMAND TO BE MADE BY THE LENDER FOR THE PAYMENT OF THE NON-REVOLING CREDIT LOANS.
(o) FLORIDA
DOCUMENTARY STAMP TAX REQUIRED BY LAW IN THE AMOUNT OF $2,450 HAS BEEN PAID OR WILL BE PAID DIRECTLY TO THE DEPARTMENT OF REVENUE. LENDER
MAY PAY THE DOCUMENTARY STAMP TAX AND ADD SUCH TAX PAYMENT AS A “Non-Revolving Credit Loan”
UNDER THIS NOTE.
IN
WITNESS WHEREOF, the Maker has duly executed and delivered this Note on the day and year first above written.
| |
MAKER: |
| |
|
| |
KEYSTAR
CORP, |
| |
a
Nevada corporation |
| |
|
|
| |
By: |
/s/
Mark Thomas |
| |
|
Mark
Thomas, its Chief Executive Officer |
| Acknowledged
and Agreed to: |
|
| |
|
| LENDER: |
|
| |
|
| EXCEL
FAMILY PARTNERS, LLLP, |
|
| a
Florida limited liability limited partnership |
|
| |
|
|
| By: |
Fortress
Holdings, LLC, its general partner |
|
| |
|
|
| By: |
/s/
Bruce A. Cassidy |
|
| |
Bruce
A. Cassidy, its Manager |
|
{Signature
Page to Third Amended and Restated Convertible Discretionary Non-Revolving Line of Credit Demand Note}
THIRD
AMENDED AND RESTATED
DISCRETIONARY
CONVERTIBLE NON-REVOLVING LINE OF CREDIT DEMAND NOTE
SCHEDULE
1
| DATE | |
NON-REVOLVING CREDIT LOANS | | |
DETAILS |
| February 10, 2022 | |
$ | 2,500.00 | | |
Payment to D.Brooks & Associates CPAs on behalf of Maker |
| February 22, 2022 | |
$ | 6,837.50 | | |
Payment to SadlerGibb on behalf of Maker |
| March 16, 2022 | |
$ | 30,000.00 | | |
Wire Transfer |
| April 20, 2022 | |
$ | 125,356.29 | | |
Legal fee reimbursement |
| August 24, 2022 | |
$ | 75,000.00 | | |
Reimbursements of business expenses to Bruce Cassidy |
| August 31, 2022 | |
$ | 802,429.57 | | |
Wire Transfer |
| September 1, 2022 | |
$ | 50,000.00 | | |
Wire Transfer |
| September 8, 2022 | |
$ | 110,000.00 | | |
Wire Transfer |
| November 9, 2022 | |
$ | 501,000.00 | | |
Wire Transfer |
| December 13, 2022 | |
$ | 150,000.00 | | |
Wire Transfer |
| December 23, 2022 | |
$ | 146,000.00 | | |
Wire Transfer |
| December 31, 2022 | |
$ | 27,628.72 | | |
Accrued Interest (as of December 31, 2022, which has been converted to principal) |
| January 5, 2023 | |
$ | 48,000.00 | | |
Wire Transfer |
| January 10, 2023 | |
$ | 100,000.00 | | |
Wire Transfer |
| January 11, 2023 | |
$ | 300,000.00 | | |
Wire Transfer |
| January 30, 2023 | |
$ | 441,059.43 | | |
Wire Transfer |
| January 31, 2023 | |
$ | 11,065.00 | | |
Wire Transfer |
| February 1, 2023 | |
$ | 137,500.00 | | |
Wire Transfer |
| February 14, 2023 | |
$ | 175,000.00 | | |
Wire Transfer |
| February 27, 2023 | |
$ | 237,500.00 | | |
Wire Transfer |
| February 27, 2023 | |
$ | 300,000.00 | | |
Wire Transfer |
| March 23, 2023 | |
$ | 75,000.00 | | |
Payment to Clark Hill PLC |
| TOTAL: | |
$ | 3,851,876.51 | | |
|
| |
Ledger
acknowledged and confirmed by: |
| |
|
| |
KEYSTAR
CORP, |
| |
a
Nevada corporation |
| |
|
|
| |
By: |
/s/
Mark Thomas |
| |
|
Mark
Thomas, its Chief Executive Officer |
v3.23.2
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