UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
SCHEDULE
13D/A
Under
the Securities Exchange Act of 1934
(Amendment
No. 1)*
DigitalFX
International, Inc.
(Name of
Issuer)
Common
Stock, par value $0.001 per share
(Title of
Class of Securities)
(CUSIP
Number)
Richard
Kall
9000
Players Club Drive
Las
Vegas, Nevada 89134
(Name,
Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
(Date of
Event which Requires Filing of this Statement)
If the
filing person has previously filed a statement on Schedule 13G to report the
acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box.
¨
Note:
Schedules filed in paper
format shall include a signed original and five copies of the schedule,
including all exhibits. See Rule 13d-7(b) for other parties to whom
copies are to be sent.
(Page 1
of 9)
*The
remainder of this cover page shall be filled out for a reporting person’s
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The
information required on the remainder of this cover page shall not be deemed to
be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934
(“Act”) or otherwise subject to the liabilities of that section of the Act but
shall be subject to all other provisions of the Act (however, see the
Notes).
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CUSIP
No.
25389E 10
7
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Page
2
of
9
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1
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NAME
OF REPORTING PERSON
SS.
OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Richard
Kall
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2
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
¨
(b)
þ
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3
|
SEC
USE ONLY
|
|
4
|
SOURCE
OF FUNDS*
OO
|
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5
|
CHECK
BOX OF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
or 2(e)
¨
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6
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CITIZENSHIP
OR PLACE OF ORGANIZATION
United
States
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7
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SOLE
VOTING POWER
15,758,468
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8
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SHARED
VOTING POWER
16,108,169
|
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9
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SOLE
DISPOSITIVE POWER
15,758,468
|
|
10
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SHARED
DISPOSITIVE POWER
16,108,169
|
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11
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AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
31,866,637
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12
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CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
¨
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13
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
79.1%
(1)
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14
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TYPE
OF REPORTING PERSON*
IN
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(1) Based
on a total of 40,270,655 shares of the Company’s common stock issued and
outstanding as of January 8, 2009.
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CUSIP
No.
25389E 10
7
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Page
3
of
9
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1
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NAME
OF REPORTING PERSON
SS.
OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The
Richard Kall Family Trust
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2
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
¨
(b)
þ
|
|
3
|
SEC
USE ONLY
|
|
4
|
SOURCE
OF FUNDS*
OO
|
|
5
|
CHECK
BOX OF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
or 2(e)
¨
|
|
6
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CITIZENSHIP
OR PLACE OF ORGANIZATION
Florida
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7
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SOLE
VOTING POWER
0
|
|
8
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SHARED
VOTING POWER
0
|
|
9
|
SOLE
DISPOSITIVE POWER
0
|
|
10
|
SHARED
DISPOSITIVE POWER
0
|
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0
|
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
¨
|
|
13
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0%
(1)
|
|
14
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TYPE
OF REPORTING PERSON*
OO
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(1) Based
on a total of 25,270,655 shares of the Company’s common stock issued and
outstanding as of January 8, 2009.
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CUSIP
No.
25389E 10
7
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Page
4
of
9
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1
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NAME
OF REPORTING PERSON
SS.
OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
VM
Investors, LLC
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2
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CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
¨
(b)
þ
|
|
3
|
SEC
USE ONLY
|
|
4
|
SOURCE
OF FUNDS*
OO
|
|
5
|
CHECK
BOX OF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
or 2(e)
¨
|
|
6
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CITIZENSHIP
OR PLACE OF ORGANIZATION
Florida
|
|
NUMBER
OF
SHARES
BENEFICIALLY
OWNED
BY EACH
REPORTING
PERSON
WITH
|
7
|
SOLE
VOTING POWER
0
|
|
8
|
SHARED
VOTING POWER
16,108,169
|
|
9
|
SOLE
DISPOSITIVE POWER
0
|
|
10
|
SHARED
DISPOSITIVE POWER
16,108,169
|
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
16,108,169
|
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
¨
|
|
13
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PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
63.7%
(1)
|
|
14
|
TYPE
OF REPORTING PERSON*
OO
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(1) Based
on a total of 25,270,655 shares of the Company’s common stock issued and
outstanding as of January 8, 2009.
This
Schedule 13D/A (“Schedule 13D/A”) amends the following sections of the Schedule
13D filed with the Securities and Exchange Commission on June 27, 2006
(“Schedule 13D”).
Item
2. Identity and Background.
Item 2 of
Schedule 13D is supplemented and amended by the information below.
This
statement is being filed jointly by Richard Kall, a citizen of the United States
(“Kall”), The Richard Kall Family Trust, an irrevocable trust organized under
the laws of the state of Florida (“Kall Trust”) and VM Investors, LLC, a Nevada
limited liability company (“VM Investors,” and together with Kall and Kall
Trust, the “Reporting Persons”).
Kall is
the Trustee of the Kall Trust, the Chairman and Chief Executive Officer of the
Company, and the Manager of VM Investors.
The Kall
Trust is an investor.
VM
Investors is an investor.
The
principal business address of each of Kall and the Kall Trust is 9000 Players
Club Drive, Las Vegas, Nevada 89134.
The
principal business address of VM Investors is 3035 East Patrick Lane, Suite 9,
Las Vegas, Nevada 89120.
During
the last five years, none of the individuals or entities identified in this Item
2 has been convicted in a criminal proceeding (excluding traffic violations and
similar misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding, was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to, federal
or state securities laws or finding any violation with respect to such
laws.
Item
3. Source and Amount of Funds or Other Consideration.
Item 3 of
Schedule 13D is supplemented and amended by the information below.
On August
1, 2006, the Company effectuated the automatic conversion of the Preferred
Shares and a 1-for-50 reverse stock split resulting in each of Kall and the Kall
Trust beneficially owning 8,242,768 shares of the Company’s common stock
(“Common Stock”).
On August
2, 2006, the Kall Trust transferred 8,242,768 shares of Common Stock to VM
Investors in exchange for certain membership interests in VM
Investors. On August 2, 2006, Lizanne Kall, Ellins and Black
transferred an aggregate of 9,315,401 shares of Common Stock to VM Investors in
exchange for certain membership interests in VM Investors.
On March
26, 2008, VM Investors transferred 1,000,000 shares of Common Stock to the
Company in connection with the restructuring of a debt transaction with third
parties.
On April
21, 2008, VM Investors transferred, as bona fide gifts, an aggregate of 450,000
shares of Common Stock to three parties.
On October 15, 2008, Kall acquired 120,689 shares of Common Stock
from three parties from whom Kall purchased an aggregate of $350,000 of
outstanding indebtedness of the Company.
On
October 15, 2008, Kall also acquired 632,779 shares of Common Stock from Peter
Newman in connection with the cancellation of a promissory note in the principal
amount of $1,468,101.40 issued by Mr. Newman in favor of Kall.
On
December 22, 2008, Kall purchased from the Company, for an aggregate purchase
price of $2,000,000, 2,000,000 shares (“Series A Shares”) of Series A 12%
Cumulative Convertible Preferred Stock (“Series A Preferred Stock”) and a
warrant to purchase 1,000,000 shares of Series A Preferred Stock (“Series A
Warrant”), with a term of 5 years and an exercise price of $1.00 per share. Kall
paid the aggregate purchase price through an advance on November 14, 2008 of
$500,000 to the Company, an advance on December 18, 2008 of $200,000 to the
Company, and a cash payment of $1,300,000 on December 22, 2008. Prior
to approval by the Company’s shareholders of the issuance of more than 19.9% of
outstanding shares of Common Stock on December 19, 2008 (“Shareholder
Approval”), the Series A Preferred Stock is not permitted to convert into (the
“conversion cap”), nor permitted to vote shares representing (the “voting cap”),
more than 19.9% of the outstanding shares of Common Stock on December 19,
2008. Each share of Series A Preferred Stock accrues dividends at the
rate of 12% per annum, paid quarterly, on the original purchase price of $1.00,
is convertible into 5 shares of Common Stock (subject to adjustment as provided
in the Articles of Amendment of the Company’s Articles of Incorporation and the
conversion cap), votes on all matters with the shares of Common Stock on an
as-converted basis (subject to the voting cap), has an initial liquidation
preference equal to the original purchase price plus accrued dividends,
participates with the Common Stock on an as-converted basis in the event that
the initial liquidation preference for the Series A Preferred Stock is fully
paid, and is entitled to vote as a separate class on certain significant
matters.
Item
4. Purpose of Transaction.
Item 4 of
Schedule 13D is supplemented and amended by the information below.
Reference
is made to the disclosure set forth under Item 3 of this Schedule 13D/A, which
disclosure is incorporated herein by reference.
Item
5. Interest in Securities of the Issuer.
Item 5 of
Schedule 13D is supplemented and amended by the information below.
Reference
is made to the disclosure set forth under Item 3 of this Schedule 13D/A, which
disclosure is incorporated herein by reference.
As of
January 8, 2009, Kall beneficially owned 31,866,637 shares of Common Stock
consisting of 758,468 shares held directly, 10,000,000 shares of Common
Stock which may be acquired by Kall within 60 days of January 8, 2009 (assuming
the Company obtains and effectuates Shareholder Approval during such 60-day
period) upon the conversion of the Series A Shares, 5,000,000 shares of Common
Stock which may be acquired by Kall within 60 days of January 8, 2009 (assuming
the Company obtains and effectuates Shareholder Approval during such 60-day
period) upon the conversion of the shares of Series A Preferred Stock issued
upon the exercise of the Series A Warrant, and 16,108,169 shares (the “VM
Shares”) held by VM Investors, of which Kall serves as the sole Manager (as Kall
is the sole Manager of VM Investors, Kall may be deemed to be the beneficial
owner of the VM Shares but disclaims beneficial ownership of the VM Shares
except to the extent of his pecuniary interest therein). Based on a
total of 25,270,655 shares of Common Stock issued and outstanding as of January
8, 2009 and the potential issuance of 15,000,000 shares of Common Stock upon the
conversion of the Series A Shares and the shares of Series A Preferred Stock
issued upon the exercise of the Series A Warrant (assuming the Company obtains
and effectuates Shareholder Approval within 60 days of January 8, 2009),
bringing the total shares of Common Stock outstanding to 40,270,655, the
percentage of stock beneficially owned by Kall is 79.1%.
Assuming
that the Company does not obtain and effectuate Shareholder Approval within 60
days of January 8, 2009, as of January 8, 2009, Kall would beneficially
own 21,918,240 shares of Common Stock consisting of 758,468 shares
held directly, 5,051,603 shares of Common Stock which may be acquired by Kall
within 60 days of January 8, 2009 upon the conversion of the Series A Shares and
the shares of Series A Preferred Stock issued upon the exercise of the Series A
Warrant (as a result of the conversion cap), and 16,108,169 shares held by VM
Investors (as Kall is the sole Manager of VM Investors, Kall may be deemed to be
the beneficial owner of the VM Shares but disclaims beneficial ownership of the
VM Shares except to the extent of his pecuniary interest
therein). Based on a total of 25,270,655 shares of Common Stock
issued and outstanding as of January 8, 2009 and the potential issuance of
5,051,603 shares of Common Stock upon the conversion of the Series A Shares and
the shares of Series A Preferred Stock issued upon the exercise of the Series A
Warrant (as a result of the conversion cap), bringing the total shares of Common
Stock outstanding to 30,322,258, the percentage of stock beneficially owned by
Kall is 72.3%.
As of
January 8, 2009, the Kall Trust beneficially owned no shares of Common Stock,
representing 0% of the issued and outstanding shares of Common
Stock. The aggregate percentage of shares of Common Stock
beneficially owned by the Kall Trust is based upon 25,270,655 shares of Common
Stock issued and outstanding as of January 8, 2009. On August 2,
2006, the Kall Trust ceased to be the beneficial owner of more than five percent
of the shares of Common Stock issued and outstanding.
As of
January 8, 2009, VM Investors beneficially owned 16,108,169 shares of Common
Stock, representing 63.7% of the issued and outstanding shares of Common
Stock. The aggregate percentage of shares of Common Stock
beneficially owned by VM Investors is based upon 25,270,655 shares of Common
Stock issued and outstanding as of January 8, 2009.
Kall has
sole power to vote or direct the vote of, and to dispose or direct the
disposition of, the shares of Common Stock held by him directly, the shares of
Common Stock issuable upon conversion of the Series A Shares, and the shares of
Common Stock issuable upon conversion of the shares of Series A Preferred Stock
issuable upon exercise of the Series A Warrant.
Kall and
VM Investors share the power to vote and dispose of the VM
Shares. The information that would be required by Item 2 of this
Schedule 13D/A for Kall and VM Investors is as follows:
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Name:
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Richard
Kall
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VM
Investors, LLC
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Address:
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9000
Players Club Drive
Las
Vegas, Nevada 89134
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3035
East Patrick Lane, Ste. 9
Las
Vegas, Nevada 89120
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Occupation/Business:
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Chairman
and CEO of DigitalFX International, Inc.
Manager
of VM Investors, LLC
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Investor
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Conviction:
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N/A
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N/A
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Civil
Proceedings:
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N/A
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N/A
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Citizenship/State
of Organization:
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United
States of America
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Nevada
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Transactions
by the Reporting Persons in the Common Stock effected in the past 60 days are
described in Item 3 above.
Item
6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer.
Item 6 of
Schedule 13D is supplemented and amended by the information below.
The
Voting Agreement dated June 15, 2006, by and among the Kall Trust, Ellins,
Black, Lizanne Kall and KRM Fund expired on June 15, 2007.
Item
7. Material to be Filed as Exhibits.
Item 7 of
Schedule 13D is supplemented and amended by the information below.
Exhibit
No.
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1
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Joint
Filing Agreement, as required by Rule 13d-1 under the Securities Exchange
Act of 1934.
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SIGNATURE
After
reasonable inquiry and to the best of its knowledge and belief, the undersigned
certify that the information set forth in this Schedule 13D is true, complete
and correct.
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Dated: January 15, 2009
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/s/
Richard
Kall
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Richard
Kall
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Dated: January 15, 2009
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The
Richard Kall Family Trust
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/s/
Richard
Kall
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Richard
Kall, Trustee
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Dated: January 15, 2009
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VM
Investors, LLC
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/s/
Richard
Kall
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Richard
Kall,
Manager
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EXHIBIT
INDEX
Exhibit
No.
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1
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Joint
Filing Agreement, as required by Rule 13d-1 under the Securities Exchange
Act of 1934.
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EXHIBIT
1
JOINT FILING
AGREEMENT
The
undersigned hereby consent to the joint filing by any of them of a Statement on
Schedule 13D and any amendments thereto, whether heretofore or hereafter filed,
relating to the securities of DigitalFX International, Inc., and hereby affirm
that this Schedule 13D/A is being filed on behalf of each of the
undersigned.
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Dated:
January 15, 2009
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/s/
Richard
Kall
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Richard
Kall
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Dated:
January 15, 2009
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The
Richard Kall Family Trust
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/s/
Richard
Kall
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Richard
Kall, Trustee
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Dated:
January 15, 2009
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VM
Investors, LLC
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/s/
Richard
Kall
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Richard
Kall,
Manager
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