AMENDMENT AND EXTENSION AGREEMENT REGARDING
COMMERCIAL TERM NOTE
DATED AUGUST 27, 2004
IN FAVOR OF
CEDAR STREET GROUP, LLC.
Reference is made to that certain COMMERCIAL TERM NOTE, dated August 27, 2004
(THE "TERM NOTE"), in the original principal amount of $250,000.00 made by
Mining Organics Management, LLC, a predecessor in interest to CONVERTED ORGANICS
INC. ("CONVERTED ORGANICS"), in favor of CEDAR STREET GROUP, LLC ("CSG"). In
connection with the amendment and extension of the Term Note, the parties wish
to enter into this Amendment and Extension Agreement, dated as of May 1, 2007
("AGREEMENT") to set forth the mutual understanding of the Parties.
In consideration of the foregoing, the mutual promises and covenants
hereinafter set forth in this Agreement, the Parties agree as follows:
For the purposes of this Agreement, defined terms used without definition
shall have the meanings given them in the Term Note.
1. Acknowledgement of Obligations. Converted Organics acknowledges and agrees
that as of May 1, 2007, principal of $250,000 and accrued interest of $89,169.14
under the Term Note are due and owing to CSG and are unpaid. Converted Organics
further acknowledges and agrees that as of May 1, 2007, an aggregate of $36,000
in back rent in respect of certain office space at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ is due and owing to CSG and is unpaid.
2. Extension Agreement. In consideration of the payment by Converted Organics of
the sum of $125,169.14, representing accrued but unpaid interest under the Term
Note of $89,169.14 and payment in full of accrued but unpaid back rent of
$36,000, CSG agrees to modify and extend the payment of the principal and any
additional interest which accrues thereunder after the date hereof as follows:
The Maturity Date for the principal amount of $250,000 and interest accrued but
unpaid shall be upon the earliest to occur of: (i) an equity funding event or
the consummation of a new debt facility, (ii) the point in time when the EBITDA
of Converted Organics of Woodbridge, LLC, a New Jersey limited liability company
of which Converted Organics is the sole member, exceeds 1.2 times maximum annual
debt service ("MADS"), or (iii) December 31, 2008.
3. Treatment of Obligations. Converted Organics covenants and agrees to treat
CSG no less favorably than it treats the holders of any other unsecured
indebtedness of Converted Organics existing as of the date hereof or hereafter
or any secured indebtedness incurred after the date hereof with respect (i) to
repayment of any and all amounts of principal and interest or (ii) any financial
or other accommodations Converted Organics may provide any of such other debt
holders at any time after the date hereof.
4. Event of Default; Acceleration of Debt. In addition to the items set forth in
the Term Note that constitute an Event of Default, it shall also be an Event of
Default if the employment of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ with Converted Organics is
terminated by Converted Organics for any reason after the date hereof. In such
event, the entire principal sum and accrued interest under the Term Note, plus
any other amounts then owing to CSG, shall at once become due and payable
without notice.
5. Terms of Commercial Note. Except as specifically modified, extended or
otherwise amended hereby, the terms and conditions of the Commercial Note shall
remain in full force and effect.
6. Entire Agreement. This Agreement, together with the Commercial Note,
represent the entire agreement between the parties hereto with respect to the
subject matter hereof and supersedes all other prior and contemporaneous
agreements and understandings, oral and written.
IN WITNESS WHEREOF the parties hereto have executed and delivered this Amendment
and Extension Agreement as of this 1st day of May 2007.
CONVERTED ORGANICS INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇
Chief Executive Officer
CEDAR STREET GROUP, LLC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Director
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