FOURTH MODIFICATION AND AMENDMENT AGREEMENT

2. The Company shall file with the Securities and Exchange Commission, a Form 8-K describing the material terms of the modifications contemplated hereby within four (4) Business Days following the Effectiveness (as defined below in Section 13).

 

3. Each Holder confirms, as to itself, the accuracy of the representations and warranties set forth in Sections 3.2(a) through (f) of the Securities Purchase Agreement with respect to the 2010 Notes and Series C Warrants held by such Holder and the modification to such Securities pursuant to this Agreement.

4. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflict of laws thereof.  Each Party agrees that all legal proceedings concerning the interpretation, enforcement and defense of this Agreement shall be commenced in the state and federal courts sitting in the City of New York, Borough of Manhattan (the “New York Courts”).  Each Party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of such New York Courts, or such New York Courts are improper or inconvenient venue for such proceeding.  Each Party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such Party at the address in effect for notices to it under its 2010 Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by applicable law.  Each Party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby. If any Party shall commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred.

 

5. The Company represents and warrants to the Holders that (i) it has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder and therein; (ii) the execution and delivery of this Agreement by the Company have been duly authorized by all necessary action on the part of such Company and no further action is required by such Company, its board of directors or its stockholders in connection therewith; (iii) this Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (a) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (b) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (c) insofar as indemnification and contribution provisions may be limited by applicable law; and (iv) the Company has reserved a sufficient number of authorized shares to issue the shares of Common Stock issuable upon conversion of the 2010 Notes and exercise of the Series C Warrants.

 

6. If the terms and provisions contained in the Transaction Documents in any way conflict with the terms and provisions contained in this Agreement, the terms and provisions contained in this Agreement shall prevail.

 

7. Except as amended and modified by this Agreement, all of the terms, representations, warranties, covenants, indemnifications, agreements and all other provisions of the Transaction Documents shall continue to remain in full force and effect.

 

8. Capitalized terms and phrases used in this Agreement without definition shall have the respective meanings set forth in the Transaction Documents, unless otherwise specified.

 

9. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile signature.

 

10. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.

 

 

11. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

12. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed by the Company (in the case of an amendment), and the Holders holding at least 67% of the then outstanding principal amount of the 2010 Notes, except that any amendment that relates to a provision of the Series C Warrants may only be waived, modified, supplemented or amended by a written instrument signed, by the Company (in the case of an amendment) and the Holders of Series C Warrants to purchase at least 67% of the shares of common stock issuable upon exercise of the then outstanding Series C Warrants.  No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.

 

13. This Agreement will become effective at the time that it is joined into by the Company and the Requisite Holders and consented to by the Guarantors (the “Effectiveness”), and the amendments and modifications made hereunder shall be binding on all Purchasers as applicable.  “Requisite Holders” means, with respect to (i) the 2010 Notes, the Security Agreement and the Subsidiary Guarantee, 67% of the outstanding principal amount of the 2010 Notes, (ii) the Securities Purchase Agreement, 67% of the Notes, Series C Warrants, the shares of common stock issuable upon an exercise of the Series C Warrants and the shares of common stock issuable upon conversion of the 2010 Notes, (iii) the Series C Warrants, 67% of the Series C Warrants outstanding and (iv) the Registration Rights Agreement, 67% of the Registrable Securities (as defined in the Registration Rights Agreement).

 

14. Notwithstanding the foregoing, if the Company does not receive the Investment of at least $1,000,000 principal amount of 2011 Notes on or prior to sixty (60) days following the Effectiveness, then this Agreement shall be null and void and of no force and effect and the terms of the Transaction Documents shall be as in effect immediately prior to the Effectiveness.

IN WITNESS WHEREOF, the Company has caused its respective signature page to this Fourth Modification and Amendment Agreement to be duly executed as of the date first written above.