CONSENT AND WAIVER AND AMENDMENT NO. 2 TO SECURITY AGREEMENT
CONSENT
AND WAIVER AND
AMENDMENT
NO. 2 TO SECURITY AGREEMENT
This
Consent and Waiver and Amendment No. 2 to Security Agreement (the “Second Amendment”) is entered into
among Stratos Renewables Corporation, a Nevada corporation (together with its
subsidiaries set forth on the signature pages hereto, the “Company”), I2BF Biodiesel
Limited, an exempt business company limited by shares existing under the laws of
the British Virgin Islands (“I2BF”), BlueDay Limited, a
business company existing under the laws of the British Virgin Islands (“BlueDay”), and Blue Day SC
Ventures, a joint venture of BlueDay and ▇▇ ▇▇▇▇▇, a partnership (“Blue Day SC Ventures” and
together with the Company and I2BF, the “Parties” and each individually
a “Party”) and effective
as of March 4, 2010.
WITNESSETH:
WHEREAS: The Parties entered
into a Note and Common Stock Purchase Agreement, dated as of July 15, 2009 (the
“Purchase Agreement”) and a Security
Agreement, dated as of July 15, 2009 (the “Security
Agreement”);
WHEREAS: On November 6, 2009,
the Company and the Parties entered into that certain Consent and Waiver and
Amendment to Security Agreement (the “Original Amendment”) in
connection with I2BF’s lending to the Company an additional sum of US$500,000
(the “November 2009 Bridge
Financing”);
WHEREAS: The Company wishes to
borrow and I2BF and BlueDay wish to lend to the Company, up to an additional sum
of US$1,850,000 pursuant to the terms of that certain Note Purchase Facility
Agreement of even date herewith (the “Facility Agreement”), in
accordance with the terms thereof;
WHEREAS: In connection with
the November 2009 Bridge Financing and again in connection with entering into
the Facility Agreement, the Parties have agreed to grant their consent with
respect to certain matters as required by the Purchase Agreement and to amend
the Security Agreement to provide for the extension of the existing security
interest to the Secured Promissory Notes issued to I2BF and BlueDay pursuant to
the Facility Agreement (the “Facility Notes” and, collectively with
the Notes issued in connection with the November 2009 Bridge Financing, the
“Additional Bridge
Notes”);
WHEREAS: Each term used but
not defined herein shall have the meaning ascribed to such term in the Purchase
Agreement.
NOW THEREFORE: In
consideration of the foregoing and the mutual covenants and agreements herein
contained, and for other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged by the Parties, and intending to be
legally bound hereby, the Parties hereby agree as follows:
1. Consent. I2BF,
BlueDay and each of them agree to and hereby do consent to the Facility
Agreement and the issuance of the Facility Notes and (i) for the purposes of
Section 5.3(iv) of the Purchase Agreement, to the Company’s incurring
indebtedness in connection therewith and (ii) for the purposes of Section 5.3(v)
of the Purchase Agreement, to the Company’s grant and extension of a security
interest in the assets of the Company and its Subsidiaries as further provided
in this Second Amendment.
2. Application of the Security
Agreement to the Additional Bridge Notes. The parties and each
of them agree that the Security Agreement shall be and hereby is amended to
provide that the Additional Bridge Notes are and each of them individually is a
“Note” for the purposes of the Security Agreement such that the security
interests granted and governed by such agreement shall be extended to form
security for the Additional Bridge Notes on a pari passu basis with the
other Notes (as defined in the Security Agreement) in accordance with their
relative principal amounts and otherwise in accordance with the Security
Agreement; provided that each of I2BF and BlueDay agrees to subordinate its
security interests to those granted to Interbank, if any, in connection with the
Interbank Financing on the same terms and conditions as holders of other secured
promissory notes of the Company.
3. Amendment of November
Note. I2BF and the Company agree to and hereby do amend the
November Note such that the date specified in clause (i) of the definition of
“Maturity Date” appearing in the recitals thereof shall be December 31,
2012.
4. Balance
Closing. The parties hereto agree and acknowledge that the
Balance Closing has not occurred as of the date hereof and, as such and in
accordance with Section 2.1(b) of the Purchase Agreement, shall occur or shall
not occur solely at the option of I2BF following the closing of the Interbank
Facility and the satisfaction of the conditions for the Balance Closing set
forth in Section 2.1(b) of the Purchase Agreement. In the event that
the Balance Closing does occur, all outstanding principal and interest with
respect to the Additional Bridge Notes shall be applied at I2BF’s option against
I2BF’s Balance Closing funding commitment as described in the Purchase
Agreement.
5. Amendment. Except
as expressly provided herein, no amendment is made to the terms of the Purchase
Agreement, the Security Agreement, any other Transaction Documents or the
Additional Bridge Notes (or any of them). Neither this Amendment nor
any term hereof may be amended, waived, discharged or terminated other than
pursuant to a written instrument executed by all of the Parties.
6. Choice of
Law. This Agreement shall be governed by and its provisions
construed and enforced in accordance with the laws of the State of California,
as applied to contracts between California residents entered into and to be
performed entirely within the State of California, without regard to the
conflict of laws principles thereof.
7. Entire
Agreement. This Amendment and the Agreement, as amended,
constitute the full and entire understanding and agreement between the Parties
with regard to the subjects hereof. No party hereto shall be liable
or bound to any other party in any manner with regard to the subjects hereof or
thereof by any warranties, representations or covenants except as specifically
set forth herein.
8. Severability. If
any provision of this Amendment becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, portions of such provision,
or such provision in its entirety, to the extent necessary, shall be severed
from this Amendment, and such court will replace such illegal, void or
unenforceable provision of this Amendment with a valid and enforceable provision
that will achieve, to the extent possible, the same economic, business and other
purposes of the illegal, void or unenforceable provision. The balance
of this Amendment shall be enforceable in accordance with its
terms.
9. Titles. The
titles used in this Amendment are used for convenience only and are not to be
considered in construing or interpreting this Amendment.
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10. Counterparts. This
Amendment may be executed in any number of counterparts, each of which shall be
enforceable against the Parties, and all of which together shall constitute one
instrument.
11. Telecopy Execution and
Delivery. A facsimile, telecopy or other reproduction of this
Amendment may be executed by one or more Parties and delivered by such party by
facsimile or any similar electronic transmission device pursuant to which the
signature of or on behalf of such party can be seen. Such execution
and delivery shall be considered valid, binding and effective for all
purposes. At the request of any party hereto, all Parties agree to
execute and deliver an original of this Amendment as well as any facsimile,
telecopy or other reproduction hereof.
12. Further
Assurances. Each party hereto agrees to execute and deliver,
by the proper exercise of its corporate, limited liability company, partnership
or other powers, all such other and additional instruments and documents and do
all such other acts and things as may be reasonably necessary to more fully
effectuate this Amendment.
[Remainder of Page Intentionally Left
Blank]
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IN
WITNESS WHEREOF, the Parties have duly executed and delivered this Consent and
Waiver and Amendment to Security Agreement as of the date first above
written.
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COMPANY:
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STRATOS
RENEWABLES CORPORATION
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/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
▇▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
President and Chief Executive Officer
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GREEN
SANDS, INC.
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I2BF
BIODIESEL LIMITED
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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Name:
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▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇, Director
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Title:
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President
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STRATOS
DEL PERU SAC
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BLUEDAY
LIMITED
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A
British Virgin Island Company
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(on
behalf of itself and Blue Day SC Ventures)
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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By:
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/s/ ▇▇▇▇▇▇ El-▇▇▇▇▇▇
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Name:
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▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
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▇▇▇▇▇▇ El-▇▇▇▇▇▇
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Title:
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General Manager
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Title:
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ARENA
VERDE SAC
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GREEN
SANDS PERU SAC
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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By:
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/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
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▇▇▇▇▇ ▇▇▇▇▇▇
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Name:
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▇▇▇▇▇ ▇▇▇▇▇▇
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Title:
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President
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Title:
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General
Manager
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