MODIFIED TERMS. The following changes to the Loan Agreement executed on February 16, 2012 and Amended on February 23, 2012 and March 30, 2012: 2.1 Reference “Affected Documents” documents above Section 1.0(a), attached as Exhibit A. The following change is incorporated to the Loan Agreement: The Loan Amount shall change from “400,000” to “600,000” payable “on or before May 30, 2012.” 2.2 Reference “Affected Documents” documents above Section 1.0(b), attached as Exhibit B. The following change is incorporated to the Secured Promissory Note: The Interest shall change from “36,000” to “54,000” payable “on or before June 30, 2012.” 2.3 Reference “Affected Documents” documents above Section 1.0(c). The following change is incorporated to the Leasehold Mortgage, Assignment, Security Agreement and Fixture Filing, attached as Exhibit C: The Equity Incentive shall change from “275,000” aggregate shares of EOS to “400,000” shares of EOS, expected to have a “going out” trading value range of US$4.00 to US$7.00 per share. 2.4 Reference “Affected Documents” documents above Section 1.0(d). The following change is incorporated to the Collateral Assignment by Personal Guarantor, attached as Exhibit D: The Maturity Date shall commence on the date of this Third Amendment, April 25, 2012. 2.5 The Other Debt section shall change from “Borrower shall be prohibited from incurring any indebtedness during the term of the Loan” to “Borrower shall be prohibited from incurring any indebtedness beyond an additional $600,000 during the term of the Loan, which will require Sharma’s consent, which shall not be unreasonably withheld. It is the understanding of the parties that the additional $600,000.00 will be added to Sharma’s existing first priority lien position, thereby increasing the loan amount and adding an additional party to the Affected Documents, which shall at that time, together with Sharma, collectively become the “Secured Lender.” However, if the original Secured Lender (Sharma) does not have adequate security, which shall be solely determined by (Sharma), the Borrower shall provide additional security to Sharma’s satisfaction, prior to the execution of all Loan Documents and Amendments.
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MODIFIED TERMS. (a) The following changes to Borrower and the Lenders hereby agree that that the Secured Obligations under the Loan Agreement executed on February 16, 2012 and Amended on February 23, 2012 and March 30, 2012:
2.1 Reference “Affected Documents” documents above Section 1.0(a), attached as Exhibit A. The following change is incorporated shall include an additional advance of SEVEN HUNDRED THOUSAND dollars ($700,000) made by the Lenders to the Loan Agreement: The Loan Amount shall change from “400,000” to “600,000” payable “on or before May 30, 2012.”
2.2 Reference “Affected Documents” documents above Section 1.0(b), attached as Exhibit B. The following change is incorporated to the Secured Promissory Note: The Interest shall change from “36,000” to “54,000” payable “on or before June 30, 2012.”
2.3 Reference “Affected Documents” documents above Section 1.0(c). The following change is incorporated to the Leasehold Mortgage, Assignment, Security Agreement and Fixture Filing, attached as Exhibit C: The Equity Incentive shall change from “275,000” aggregate shares of EOS to “400,000” shares of EOS, expected to have a “going out” trading value range of US$4.00 to US$7.00 per share.
2.4 Reference “Affected Documents” documents above Section 1.0(d). The following change is incorporated to the Collateral Assignment by Personal Guarantor, attached as Exhibit D: The Maturity Date shall commence Borrower on the date of this Third AmendmentSecond Amendment (the “Tranche B Loan”). The Borrower acknowledges and agrees that the Tranche B Loan was funded with a non-refundable, April 25original issue discount of ONE HUNDRED THOUSAND dollars ($100,000.00). Such original issue discount is a payment for the use of money loaned hereunder, 2012and not a payment for services, and shall be taken into account as required by the original issue discount rules of the Internal Revenue Code of 1986, as amended. Such original issue discount is fully earned on the date hereof and is not refundable under any circumstances.
2.5 (b) Notwithstanding Section 2.1(c) of the Loan Agreement, the Tranche B Loan shall not bear interest; provided, however, that after the occurrence, and during the continuance of an Event of Default, the Tranche B Loan shall bear interest in accordance with Section 2.3 of the Loan Agreement.
(c) The Other Debt section Borrower will repay the Secured Obligations in equal weekly installments of FIFTY THOUSAND dollars ($50,000.00) due and payable on the last Business Day of each calendar week commencing with Friday, July 7, 2023, until the Secured Obligations have been repaid in full. Such weekly payments shall change from “be applied to the Secured Obligations in the following order, (1) first, to the Tranche B Loan until it has been repaid in full, (2) second, to the accrued and unpaid interest on the Term Loan Advance, and (3) to the third, to the outstanding principal balance of the Term Loan Advance. The Borrower’s failure to make any such weekly installment payment on the due date therefor shall be an immediate Event of Default under the Loan Agreement. For the avoidance of doubt, the foregoing weekly payment is in addition to, and not in limitation of, any payments of principal or interest required under Section 2.1 of the Loan Agreement or any other relevant provisions thereof.
(d) The Tranche B Loan shall be evidenced by one or more accounts or records maintained by the Lenders. Such accounts or records shall be conclusive, absent manifest error, of the outstanding amount of the Tranche B Loan and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Tranche B Loan. Upon the written request of the Lenders, the Borrower shall be prohibited from incurring any indebtedness during execute and deliver to the term of Lenders a promissory note in a form acceptable to the Loan” to “Borrower shall be prohibited from incurring any indebtedness beyond an additional $600,000 during the term of the Loan, which will require Sharma’s consentLenders, which shall not be unreasonably withheld. It is evidence the understanding of Tranche B Loan in addition to such accounts or records.
(e) In the parties event that the additional Borrower receives gross proceeds of at least $600,000.00 will be added 2,000,000 from any debt or equity financing, then the Borrower shall repay the Secured Obligations in amount equal to Sharma’s existing first priority lien position, thereby increasing the loan amount and adding an additional party to the Affected Documents, which shall at that time, together with Sharma, collectively become the “Secured Lender.” However, if the original Secured Lender NINE HUNDRED FIFTY THOUSAND dollars (Sharma) does not have adequate security$950,000.00), which shall be solely determined by (Sharma)applied as follows: 1) first, the Borrower shall provide additional security to Sharma’s satisfaction, prior to the execution Tranche B Loan, 2) to the accrued and unpaid interest on the Term Loan Advance, and 3) third, to outstanding principal amount of all the Term Loan Documents and AmendmentsAdvance.
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