AMENDEMENT TO DEBENTURES AND WARRANTS, AGREEMENT AND WAIVER
Exhibit
99.1
AMENDEMENT
TO DEBENTURES AND WARRANTS, AGREEMENT AND WAIVER
THIS
AGREEMENT AND WAIVER (this “Agreement”)
is
entered into on August 29, 2008, and is effective as of May 1, 2008 (the
“Agreement
Effective Date”) by and among Enable Growth Partners LP (“EGP”), Enable
Opportunity Partners LP (“EOP”),
▇▇▇▇▇▇ Diversified Strategy Master Fund LLC, Ena (“▇▇▇▇▇▇”,
together with EGP, EOP and ▇▇▇▇▇▇, the “Enable
Funds”),
and
BridgePointe Master Fund Ltd. (“BridgePointe”)
and
Ecotality, Inc., a Nevada corporation (the “Company”).
Capitalized terms not defined in this Agreement shall have the meanings ascribed
to such terms in each of the Purchase Agreements (each as defined below) or
in
each of the Debentures (each as defined below).
RECITALS
WHEREAS,
pursuant to a Securities Purchase Agreement dated November 6, 2007 (the
“November
Purchase Agreement”)
by and
among the Company and EGP, EOP, ▇▇▇▇▇▇ and BridgePointe (collectively, the
“November
Investors”),
the
Company issued to each of the November Investors (a) an aggregate principal
amount equal to $4,117,649 of the Company’s Original Issue Discount 8% Secured
Convertible Debentures, due May 6, 2010 (the “November
Debentures”),
and
(b) common stock purchase warrants to purchase an aggregate of 6,862,748 shares
of Common Stock, with an exercise price of $0.32 per share (the “November
Warrants”
and
together with the November Debentures, the “November
Securities”);
WHEREAS,
pursuant to a Securities Purchase Agreement dated December 6, 2007 (the
“December
Purchase Agreement”,
and
together with the November Purchase Agreement, the “Purchase
Agreements”)
by and
among the Company and EGP, EOP and BridgePointe (collectively, the “December
Investors”
and,
together with the November Investors, the “Investors”),
the
Company issued to each of the December Investors (a) an aggregate principal
amount equal to $1,764,706.50 of the Company’s Original Issue Discount 8%
Secured Convertible Debentures, due June 6, 2010 (the “December
Debentures”
and,
together with the November Debentures, the “Debentures”),
and
common stock purchase warrants to purchase an aggregate of 2,941,177 shares
of
Common Stock, with an exercise price of $0.32 per share (the “December
Warrants”
and,
together with the November Warrants, the “Warrants”
and
the
December Warrants and the December Debentures,
the
“December
Securities”
and
together with the November Securities, the “Securities”);
WHEREAS,
pursuant to Section 6(b) of the November Debentures, on each Monthly Redemption
Date, beginning on May 6, 2008, the Company was required to redeem the Monthly
Redemption Amount (the “November
Monthly Redemption”);
WHEREAS,
pursuant to Section 6(b) of the December Debentures, on each Monthly Redemption
Date, beginning on June 6, 2008, the Company was required to redeem the Monthly
Redemption Amount (the “December
Monthly Redemption”
and,
together with the November Monthly Redemption, the “Monthly
Redemption”);
WHEREAS,
pursuant to Section
2 of
the November Debentures, the Company was required to make
cash
payments on July 1, 2008, October 1, 2008 and January 1, 2009, to pay interest
to the November Investors which accrued during
the period commencing on April
1,
2008
through
December 31, 2008 with
respect to the aggregate unconverted and then outstanding principal amount
of
the November Debentures
(the
“Waived November
Interest Payments”);
WHEREAS,
pursuant to Section 2 of the December Debentures, the
Company was required to make cash payments on July 1, 2008, October 1, 2008
and
January 1, 2009, to pay interest to the December Investors which accrued
during
the period commencing on April
1,
2008
through
December 31, 2008 with
respect to the aggregate unconverted and then outstanding principal amount
of
the December
Debentures (the
“Waived
December Interest Payments”
and,
together with the Waived November Interest Payment, the “Waived Interest
Payments”);
WHEREAS,
it is the intention of the Company and the Investors that the holding periods
for the Debentures and the Warrants, in each case, as amended hereby, will
tack
to, and run from, the Original Issue Dates of the Debentures and the Warrants,
respectively; and
WHEREAS,
the Company and the Investors now desire that the terms of the Debentures and
the Warrants be modified and have entered into this Agreement to document their
agreement regarding such modifications.
AGREEMENT
NOW,
THEREFORE, the parties to this Agreement, for adequate and sufficient
consideration, the receipt of which is hereby acknowledged, do hereby agree
as
follows:
|
1.
|
Incorporation
of Preliminary Statements.
The Recitals set forth above by this reference hereto are hereby
incorporated into this Agreement.
|
| 2. |
Waiver
of Interest Payments:
|
|
a.
|
Each
November Investor, severally
and not jointly with the other November Investors, hereby waives
any right
or interest it may have in or to the Waived November Interest Payments.
|
|
b.
|
Each
December Investor, severally and not jointly with the other December
Investors, hereby waives any right or interest it may have in or
to the
Waived December Interest Payments.
|
|
c.
|
For
the avoidance of doubt, the amounts of each Investor’s Waived Interest
Payments are set forth on Schedule
6
to
this Agreement.
|
| 3. |
Deferral
of Monthly Redemptions:
|
|
a.
|
Each
November Investor, severally and not jointly with the other November
Investors, hereby defers any right or interest it may have in or
to any
payment in respect of the November Monthly Redemption that would
otherwise
have been due between June 1, 2008 and December 31, 2008, provided
that
beginning on and including January 1, 2009, Monthly Redemptions shall
be
payable in accordance with the terms of the November Debentures,
as
amended hereby.
|
|
b.
|
Each
December Investor, severally and not jointly with the other December
Investors, hereby waives any right or interest it may have in or
to any
payment in respect of the December Monthly Redemption that would
otherwise
have been due between June 1, 2008 and December 31, 2008, provided
that
beginning on and including January 1, 2009, Monthly Redemptions shall
be
payable in accordance with the terms of the December Debentures,
as
amended hereby.
|
|
4.
|
Amendment
to Monthly Redemption Date of the
Debentures.
|
| a. |
The
definition of “Monthly Redemption Date” in Section 1 of the November
Debentures is hereby deleted and replaced in its entirety with the
following:
|
“Monthly
Redemption Date” means January 1, 2009, and the first (1st)
calendar day of each month thereafter, and terminating upon the full redemption
of this Debenture.
| b. |
The
definition of “Monthly Redemption Date” in Section 1 of the December
Debentures is hereby deleted and replaced in its entirety with the
following:
|
“Monthly
Redemption Date” means January 1, 2009, and the first (1st)
calendar day of each month thereafter, and terminating upon the full redemption
of this Debenture.
|
5.
|
Increase
to Outstanding Principal Amount of Debentures.
|
| a. |
The
outstanding principal amount of each November Debenture is hereby
amended
and increased to an amount equal to 120% of the sum of (i) the outstanding
principal amount of such November Debenture immediately prior hereto,
plus
(ii) the
amount of the Waived November Interest Payments (the
“New
November Principal Amount”).
|
| b. |
The
outstanding principal amount of each December Debenture is hereby
amended
and increased to an amount equal to 120% of the sum of (i) the outstanding
principal amount of such December Debenture immediately prior hereto,
plus
(ii) the amount of the Waived December Interest Payments (the “New
December Principal Amount”).
|
| c. |
For
the avoidance of doubt, the New November Principal Amount for each
November Debenture and the New December Principal Amount for each
December
Debenture, along with the new Monthly Redemption Amounts for each
such
debenture are set forth on Schedule 6
attached hereto. The amounts set forth on Schedule 6
shall govern absent manifest error.
|
| d. |
The
Company shall enter the New November Principal Amount and the New
December
Principal Amount on its books, and shall maintain records of the
principal
amount outstanding on the November Debenture and December Debenture
by
book entry.
|
|
6.
|
Adjustment
to Conversion Price of the Debentures.
The “Conversion Price,” as defined in the Debentures, is hereby adjusted
to equal $0.15, subject to further adjustment pursuant to the terms
of the
Debentures.
|
|
7.
|
Amendment
to Monthly Redemption Amount of the Debentures.
|
|
a.
|
The
definition of “Monthly Redemption Amount” in Section 1 the November
Debenture is hereby amended to mean the New November Principal Amount
(as
defined above), divided by seventeen
(17), plus
accrued but unpaid interest, liquidated damages and any other amounts
then
owing to the Holder in respect of this
Debenture.
|
|
b.
|
The
definition of “Monthly Redemption Amount” in Section 1 the December
Debenture is hereby amended to mean the New December Principal Amount
(as
defined above), divided by eighteen
(18), plus
accrued but unpaid interest, liquidated damages and any other amounts
then
owing to the Holder in respect of this
Debenture.
|
The
new
Monthly Redemption Amount for each of the November Investors and each of the
December Investors, respectively, is set forth on Schedule 6 attached hereto.
The amounts set forth on Schedule 6
shall
govern absent manifest error.
|
8.
|
Tolling
of Interest Accrual:
|
| a. |
In
consideration of the terms hereof, no interest shall accrue on the
November Debentures after the date hereof until January 1, 2009,
at which
time interest shall commence to accrue on the November Debentures
in
accordance with their terms.
|
| b. |
In
consideration of the terms hereof, no interest shall accrue on the
December Debentures after the date hereof until January 1, 2009,
at which
time interest shall commence to accrue on the December Debentures
in
accordance with their terms.
|
|
9.
|
Accrual
of Interest on Debentures:
|
| a. |
Section
2(a) of the November Debentures is hereby amended and replaced, in
its
entirety, with the followings:
|
“Payment
of Interest in Cash.
The
Company shall pay interest to the Holder on the aggregate unconverted and then
outstanding principal amount of this Debenture at the rate of 8% per annum,
accruing beginning January 1, 2009 and payable quarterly on each January 1,
April 1, July 1 and October 1, beginning on and including April 1, 2009, on
each
Monthly Redemption Date (as to that principal amount then being redeemed),
on
each Conversion Date (as to that principal amount then being converted), on
each
Optional Redemption Date (as to that principal amount then being redeemed)
and
on the Maturity Date (each such date, an “Interest
Payment Date”)
(if any Interest Payment Date is not a Business Day, then the applicable payment
shall be due on the next succeeding Business Day), in cash.”
| b. |
Section
2(a) of the December Debentures is hereby amended and replaced, in
its
entirety, with the following:
|
“Payment
of Interest in Cash.
The
Company shall pay interest to the Holder on the aggregate unconverted and then
outstanding principal amount of this Debenture at the rate of 8% per annum,
accruing beginning January 1, 2009 and payable quarterly on each January 1,
April 1, July 1 and October 1, beginning on and including April 1, 2009, on
each
Monthly Redemption Date (as to that principal amount then being redeemed),
on
each Conversion Date (as to that principal amount then being converted), on
each
Optional Redemption Date (as to that principal amount then being redeemed)
and
on the Maturity Date (each such date, an “Interest
Payment Date”)
(if any Interest Payment Date is not a Business Day, then the applicable payment
shall be due on the next succeeding Business Day), in cash.”
|
10.
|
Certain
Definitions.
|
For
purposes hereof,
“Innergy
Power” shall mean Innergy Power Corporation, a Delaware corporation and its
wholly owned subsidiary, Portable Energy De Mexico, S.A. DE C.V. Innergy Power
Corporation.
“Innergy
Power Acquisition” shall mean the Company’s acquisition of assets from Innergy
Power on or about October 1, 2007.
“Innergy
Power Make-Whole” means the additional shares of common stock that the Company
is required to issue to Innergy Power, on or about November 1,
2008.
“Edison”
shall mean, collectively, (a) Edison Source, a California corporation, (b)
Edison Enterprises, a California corporation, and (c) certain of their
affiliates.
“Edison
Acquisition” shall mean the Company’s acquisition of assets from Edison on or
about December 4, 2007.
“Edison
Make-Whole” means the additional shares of common stock that the Company is
required to issue to Edison on or about December 15, 2008.
|
11.
|
Adjustments
to Debentures Upon Make-Whole
Issuances.
|
| a. |
In
consideration of the terms hereof, immediately following any issuance
by
the Company of any additional Common Stock or Common Stock Equivalents
to
Innergy Power in conjunction with the Innergy Power Make-Whole or
to
Edison in conjunction with the Edison Make-Whole (each, an “Acquisition
Make-Whole Issuance”),
the Conversion Price of the November
Debenture shall be reduced to equal the lesser of (i) the Conversion
Price
in effect immediately prior to such Acquisition Make-Whole Issuance,
or
(ii) the average of the VWAPs for the twenty (20) trading day period
immediately preceding the date of each such Acquisition Make-Whole
Issuance, subject to further adjustments pursuant to the terms of
the
November
Debenture. Notwithstanding anything to the contrary in the Transaction
Documents, but
subject to the immediately preceding sentence, the
Acquisition Make-Whole Issuances shall not be considered to be “Exempt
Issuances.”
|
| b. |
In
consideration of the terms hereof, immediately following any Acquisition
Make-Whole Issuance, the Conversion Price of the December
Debenture shall be reduced to equal the lesser of (i) the Conversion
Price
in effect immediately prior to such Acquisition Make-Whole Issuance,
or
(ii) the average of the VWAPs for the twenty (20) trading day period
immediately preceding the date of each such Acquisition Make-Whole
Issuance, subject to further adjustments pursuant to the terms of
the
December
Debenture. Notwithstanding anything to the contrary in the Transaction
Documents, but subject to the immediately preceding sentence, the
Acquisition Make-Whole Issuances shall not be considered to be “Exempt
Issuances.”
|
|
12.
|
Adjustments
to Warrants Upon Make-Whole
Issuances:
|
| a. |
In
consideration of the terms hereof, immediately following any Acquisition
Make-Whole Issuance, the Exercise Price of the November
Warrants shall be reduced to equal the lesser of (i) the Exercise
Price in
effect immediately prior to such Acquisition Make-Whole Issuance,
or (ii)
the average of the VWAPs for the twenty (20) trading day period
immediately preceding the date of each such Acquisition Make-Whole
Issuance, and the number of Warrant Shares issuable thereunder shall
be
increased such that the aggregate Exercise Price payable thereunder,
after
taking into account the decrease in the Exercise Price, shall be
equal to
the aggregate Exercise Price prior to such adjustment, subject to
further
adjustments to the Exercise Price and number of shares pursuant to
the
terms of the November
Warrants. Notwithstanding anything to the contrary in the Transaction
Documents, but subject to the immediately preceding sentence, the
Acquisition Make-Whole Issuances shall not be considered to be “Exempt
Issuances.”
|
| b. |
In
consideration of the terms hereof, immediately following any Acquisition
Make-Whole Issuance, the Exercise Price of the December
Warrants shall be reduced to equal the lesser of (i) the Exercise
Price in
effect immediately prior to such Acquisition Make-Whole Issuance,
or (ii)
the average of the VWAPs for the twenty (20) trading day period
immediately preceding the date of each such Acquisition Make-Whole
Issuance, and the number of Warrant Shares issuable thereunder shall
be
increased such that the aggregate Exercise Price payable thereunder,
after
taking into account the decrease in the Exercise Price, shall be
equal to
the aggregate Exercise Price prior to such adjustment, subject to
further
adjustments to the Exercise Price and number of shares pursuant to
the
terms of the December
Warrants. Notwithstanding anything to the contrary in the Transaction
Documents, but subject to the immediately preceding sentence, the
Acquisition Make-Whole Issuances shall not be considered to be “Exempt
Issuances.”
|
|
13.
|
Antidilution
Adjustment to Number of Warrant
Shares:
|
| a. |
On
the next business day following the last to occur of the date that
the
Company is required to issue (or, if later, the date the Company
actually
issues) shares of Common Stock to Edison pursuant to the Edison Make-Whole
or to Innergy pursuant to the Innergy Make-Whole, the number of Warrant
Shares issuable under the November
Warrant shall be increased (but not decreased) to equal the November
Warrant Percentage of the number of shares of the Company then deemed
outstanding, on a fully diluted basis, subject to further adjustments
to
the Exercise Price and number of shares pursuant to the terms of
the
November
Warrant, where the “November Warrant Percentage” for each November
Investor is set forth on Schedule 13 hereto.
|
| b. |
On
the next business day following the last to occur of the date that
the
Company is required to issue shares of Common Stock to Edison pursuant
to
the Edison Make-Whole or to Innergy pursuant to the Innergy Make-Whole,
the number of Warrant Shares issuable under the December
Warrant shall be increased (but not decreased) to equal the December
Warrant Percentage of the number of shares of the Company then deemed
outstanding, on a fully diluted basis, subject to further adjustments
to
the Exercise Price and number of shares pursuant to the terms of
the
December Warrant, where the “December Warrant Percentage”
for each December Investor is set forth on Schedule 13 hereto.
|
| 14. |
Exempt
Issuance:
Each Investor, severally and not jointly with the other Investors,
hereby
(a) agrees that the amendments to the November Securities and the
December
Securities shall constitute an “Exempt Issuance” pursuant to the November
Purchase Agreement and the December Purchase Agreement, respectively
and
(b) agrees that neither the Conversion Price of the Debentures nor
the
Exercise Price of the Warrants shall be adjusted as a result of the
issuances of securities under this Agreement, except as expressly
provided
in this Agreement..
|
| 15. |
Additional
Representations and Covenants.
In addition to the foregoing, during the period from April 1, 2008
until
December 31, 2008 (the “Waiver Period”), the Company agrees as
follows:
|
|
a.
|
Any
reports on Form 10-Q or Form 10-QSB filed by the Company with the
U.S.
Securities and Exchange Commission (the “SEC”)
for the three month periods ending on each of the following dates,
respectively, which disclose on the Statement of Cash Flows “Net Cash Used
in Operating Activities,” provide (if already filed) or will provide (if
not yet filed) a consolidated net cash burn rate (defined as the
average
monthly net income (loss) for each month during such three month
period
and adding back non-cash expenses) that does not exceed the following
amounts:
|
|
i.
June
30, 2008
|
$
|
150,000
|
||
|
ii.
September
30, 2008
|
$
|
100,000
|
||
|
iii.
December
31, 2008
|
$
|
75,000
|
|
b.
|
Any
reports on Form 10-Q or 10-QSB filed by the Company with the SEC
for the
three month periods ending on each of the following dates, respectively,
which disclose in the Management Discussion and Analysis and the
Consolidated Balance Sheet the consolidated trade accounts payable
amount,
provide (if already filed) or will provide (if not yet filed) that
the
Company’s current ratio (defined as the ratio of consolidated current
assets to consolidated current liabilities, excluding non-cash expenses
included in current liabilities), on the last day of such period
is at
least :
|
|
i.
June 30, 2008
|
1.25
|
|||
|
ii.
September 30, 2008
|
1.25
|
|||
|
iii.
December 31, 2008
|
1.25
|
|
c.
|
Any
reports on Form 10-Q or 10-QSB filed by the Company for the three
month
periods ending on each of the following dates, respectively, which
disclose in the Management Discussion and Analysis and the Consolidated
Balance Sheet the consolidated trade accounts payable amount, provide
(if
already filed) or will provide (if not yet filed) that the consolidated
trade accounts payable amount on the last day of such period does
not
exceed:
|
|
i.
June 30, 2008
|
$
|
1,200,000
|
||
|
ii.
September 30, 2008
|
$
|
500,000
|
||
|
iii.
December 31, 2008
|
$
|
500,000
|
Any
failure by the Company to satisfy the covenants set forth above during the
Waiver Period will constitute an Event of Default under the Debentures, each
as
amended by this Agreement.
| 16. |
Waiver.
To the extent any of the above described actions or issuances would
constitute a default or an Event of Default under the Debentures,
each
Investor hereby waives any such defaults or Events of Default relating
solely to the actions or issuances set forth in this Agreement and
each
Investor hereby withdraws any notice or demand to the
contrary.
|
| 17. |
Representations
and Warranties of the Company.
The Company hereby makes to the Investors the following representations
and warranties:
|
|
a.
|
Authorization;
Enforcement.
The Company 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 thereunder.
The
execution and delivery of this Agreement by the Company and the
consummation by it of the transactions contemplated hereby have been
duly
authorized by all necessary action on the part of the Company and
no
further action is required by the Company, its board of directors
or its
stockholders in connection therewith. 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
(i) as
limited by general equitable principles and applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as
indemnification and contribution provisions may be limited by applicable
law.
|
|
b.
|
Issuance
of the Securities. The shares underlying the Securities, when issued
in
accordance with the terms of this Agreement, will be validly issued,
fully
paid and nonassessable, free and clear of all Liens imposed by the
Company
other than restrictions on transfer provided for in the Transaction
Documents. The Company has authorized and reserved from its duly
authorized capital stock a sufficient number of shares of Common
Stock for
issuance of the shares underlying the
Securities.
|
|
c.
|
No
Conflicts.
The execution, delivery and performance of this Agreement by the
Company
and the consummation by the Company of the transactions contemplated
hereby do not and will not: (i) conflict with or violate any provision
of
the Company’s or any Subsidiary’s certificate or articles of
incorporation, bylaws or other organizational or charter documents,
or
(ii) conflict with, or constitute a default (or an event that with
notice
or lapse of time or both would become a default) under, result in
the
creation of any Lien (except as contemplated by the Security Documents
with respect to the November Debentures and the December Debentures)
upon
any of the properties or assets of the Company or any Subsidiary,
or give
to others any rights of termination, amendment, acceleration or
cancellation (with or without notice, lapse of time or both) of,
any
material agreement, credit facility, debt or other material instrument
(evidencing a Company or Subsidiary debt or otherwise) or other material
understanding to which the Company or any Subsidiary is a party or
by
which any property or asset of the Company or any Subsidiary is bound
or
affected, or (iii) conflict with or result in a violation of any
law,
rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority to which the Company or a
Subsidiary is subject (including federal and state securities laws
and
regulations), or by which any property or asset of the Company or
a
Subsidiary is bound or affected; except in the case of each of clauses
(ii) and (iii), such as could not have or reasonably be expected
to result
in a Material Adverse Effect.
|
|
d.
|
Equal
Consideration.
Except as set forth in this Agreement, no consideration has been
offered
or paid to any person to amend or consent to a waiver, modification,
forbearance or otherwise of any provision of any of the Transaction
Documents.
|
| 18. |
Representations
and Warranties of the Investors.
Each Investor, severally and not jointly with the other Investors,
represents and warrants as of the date hereof to the Company as follows:
(a) the execution, delivery and performance by such Investor of the
transactions contemplated by this Agreement have been duly authorized
by
all necessary corporate or similar action on the part of such Investor
and
(b) this Agreement has been duly executed by such Investor, and when
delivered by such Investor in accordance with the terms hereof, will
constitute the valid and legally binding obligation of such Investor,
enforceable against it in accordance with its terms, except (i) as
limited
by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application
affecting
enforcement of creditors’ rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive
relief or
other equitable remedies and (iii) insofar as indemnification and
contribution provisions may be limited by applicable
law.
|
| 19. |
Effect
on Transaction Documents. Subject
to the waivers and amendments provided herein, all of the terms and
conditions of the Transaction Documents shall continue in full force
and
effect after the execution of this Agreement and shall not be in
any way
changed, modified or superseded by the terms set forth herein, including
but not limited to, any other obligations the Company may have to
the
Investors under the Transaction
Documents
provided however that references to Securities, Debentures, Warrants
and
Underlying Shares in the Transaction Documents shall include such
securities, as amended hereby, and the shares underlying such Securities,
respectively.
Except as
expressly set forth herein, this Agreement shall not be deemed to
be a
waiver, amendment or modification of any provisions of the Transaction
Documents or of any right, power or remedy of the Investors, or constitute
a waiver of any provision of the Transaction Documents (except to
the
extent herein set forth), or any other document, instrument and/or
agreement executed or delivered in connection therewith, in each
case
whether arising before or after the date hereof or as a result of
performance hereunder or thereunder. The Investors reserve all rights,
remedies, powers, or privileges available under the Transaction Documents,
at law or otherwise. This Agreement shall not constitute a novation
or
satisfaction and accord of the Transaction Documents or any other
document, instrument and/or agreement executed or delivered in connection
therewith, including, without limitation, the Security Agreement.
|
| 20. |
Amendments
and Waivers.
The provisions of this Agreement, including the provisions of this
sentence, may not be amended, modified or supplemented, and waivers
or
consents to departures from the provisions hereof may not be given,
unless
the same shall be in writing and signed by the Company and the
Investors.
|
| 21. |
Notices.
Any and all notices or other communications or deliveries required
or
permitted to be provided hereunder shall be delivered as set forth
in the
applicable Transaction Document.
|
| 22. |
Successors
and Assigns.
This Agreement shall inure to the benefit of and be binding upon
the
successors and permitted assigns of each of the parties and shall
inure to
the benefit of the Investors. The Company may not assign (except
by
merger) its rights or obligations hereunder without the prior written
consent of the Investors. The Investors may assign their respective
rights
hereunder in the manner and to the Persons as permitted under the
applicable Transaction Document.
|
| 23. |
Execution
and Counterparts.
This Agreement may be executed in two or more counterparts, all of
which
when taken together 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, it being understood that both parties
need not sign the same counterpart. In the event that any signature
is
delivered by facsimile transmission or by e-mail delivery of a “.pdf”
format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature
is
executed) with the same force and effect as if such facsimile or
“.pdf”
signature page were an original
thereof.
|
| 24. |
Governing
Law.
All questions concerning the construction, validity, enforcement
and
interpretation of this Agreement shall be determined in accordance
with
the provisions of the Transaction
Documents.
|
| 25. |
Severability.
If any term, provision, covenant or restriction of this Agreement
is held
by a court of competent jurisdiction to be invalid, illegal, void
or
unenforceable, the remainder of the terms, provisions, covenants
and
restrictions set forth herein shall remain in full force and effect
and
shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their commercially reasonable efforts to find and
employ
an alternative means to achieve the same or substantially the same
result
as that contemplated by such term, provision, covenant or restriction.
It
is hereby stipulated and declared to be the intention of the parties
that
they would have executed the remaining terms, provisions, covenants
and
restrictions without including any of such that may be hereafter
declared
invalid, illegal, void or
unenforceable.
|
| 26. |
Headings.
The headings in this Agreement are for convenience only, do not constitute
a part of this Agreement and shall not be deemed to limit or affect
any of
the provisions hereof.
|
| 27. |
Effectiveness.
The effectiveness of this Agreement shall be expressly conditioned
upon
the Investors’ receipt, on or before the date hereof, of (i) a
certificate, dated as of the date hereof, executed by the Chief Executive
Officer of the Company certifying that, to the best knowledge of
the Chief
Executive Officer after reasonable investigation, no Event of Default,
except as expressly waived in this Agreement, and no
event which, with the giving of notice or passage of time (or both),
would
constitute an Event of Default under the Debentures has occurred
or is
continuing and (ii) all documents required
to be delivered by the Company hereunder shall have been executed
and
delivered to the Investors. In the event the foregoing items are
not
delivered to the Investors, all of the consents, amendments and waivers
of
the Investors contained herein shall be null and void.
|
| 28. |
Disclosure
and Filing of 8-K. Except with respect to the material terms and
conditions of the transactions contemplated by this Agreement, the
Company
confirms that neither it nor any other Person acting on its behalf
has
provided any of the Investors or their agents or counsel with any
information that it believes constitutes or might constitute material,
nonpublic information. On or before the second (2nd)
Trading Day immediately following the date hereof, the Company shall
file
a Current Report on Form 8-K, reasonably acceptable to each Investor
disclosing the material terms of the transaction contemplated hereby,
which shall include this Agreement as an attachment
hereto.
|
| 29. |
INDEPENDENT
NATURE OF INVESTORS’ OBLIGATIONS AND RIGHTS.
THE COMPANY HAS ELECTED TO PROVIDE ALL INVESTORS WITH THE SAME TERMS
AND
FORM OF THIS AGREEMENT FOR THE CONVENIENCE OF THE COMPANY AND NOT
BECAUSE
IT WAS REQUIRED OR REQUESTED TO DO SO BY THE INVESTORS. THE OBLIGATIONS
OF
EACH INVESTOR UNDER THIS AGREEMENT, AND ANY TRANSACTION DOCUMENT
ARE
SEVERAL AND NOT JOINT WITH THE OBLIGATIONS OF ANY OTHER INVESTOR,
AND NO
INVESTOR SHALL BE RESPONSIBLE IN ANY WAY FOR THE PERFORMANCE OR
NON-PERFORMANCE OF THE OBLIGATIONS OF ANY OTHER INVESTOR UNDER THIS
AGREEMENT OR ANY TRANSACTION DOCUMENT. NOTHING CONTAINED HEREIN OR
IN ANY
TRANSACTION DOCUMENT, AND NO ACTION TAKEN BY ANY INVESTOR PURSUANT
THERETO, SHALL BE DEEMED TO CONSTITUTE THE INVESTORS AS A PARTNERSHIP,
AN
ASSOCIATION, A JOINT VENTURE OR ANY OTHER KIND OF ENTITY, OR CREATE
A
PRESUMPTION THAT THE INVESTORS ARE IN ANY WAY ACTING IN CONCERT OR
AS A
GROUP WITH RESPECT TO SUCH OBLIGATIONS OR THE TRANSACTIONS CONTEMPLATED
BY
THIS AGREEMENT OR THE TRANSACTION DOCUMENTS. EACH INVESTOR SHALL
BE
ENTITLED TO INDEPENDENTLY PROTECT AND ENFORCE ITS RIGHTS, INCLUDING
WITHOUT LIMITATION, THE RIGHTS ARISING OUT OF THIS AGREEMENT OR OUT
OF THE
OTHER TRANSACTION DOCUMENTS, AND IT SHALL NOT BE NECESSARY FOR ANY
OTHER
INVESTOR TO BE JOINED AS AN ADDITIONAL PARTY IN ANY PROCEEDING FOR
SUCH
PURPOSE. EACH INVESTOR HAS BEEN REPRESENTED BY ITS OWN SEPARATE LEGAL
COUNSEL IN THEIR REVIEW AND NEGOTIATION OF THIS AGREEMENT AND THE
TRANSACTION DOCUMENTS.
|
[signature
page follows]
IN
WITNESS WHEREOF, the Company and each of the Investors have executed this
Agreement as of the Agreement Effective Date.
COMPANY:
a
Nevada
corporation
| By: | ||||
|
Name:
Title:
|
INVESTORS:
ENABLE
GROWTH PARTNERS LP,
a
Delaware limited partnership
| By: | ||||
|
Name:
Title:
|
ENABLE
OPPORTUNITY PARTNERS LP,
a
Delaware limited partnership
| By: | ||||
|
Name:
Title:
|
▇▇▇▇▇▇
DIVERSIFIED STRATEGY MASTER FUND LLC, ENA,
a
Delaware limited liability company
| By: | ||||
|
Name:
Title:
|
BRIDGEPOINTE
MASTER FUND LTD.,
a
Cayman
Islands Exempted Company
| By: | ||||
|
Name:
Title:
|
Acknowledged
by:
ECOTALITY
STORES, INC.
| By: | ||||
|
Name:
Title:
|
PORTABLE
ENERGY DE MEXICO, S.A. de C.V.
| By: | ||||
|
Name:
Title:
|
SCHEDULE
6
MONTHLY
REDEMPTION AMOUNT
NOVEMBER
DEBENTURES
|
Name
of Investor
|
Principal
Amount of the November Debenture Outstanding Immediately Prior to
this
Agreement (the “Pre-Amendment Outstanding
Principal”)
|
Amount
of Interest Which Would Have Accrued from April 1, 2008 Through December
31, 2008 (“Waived Interest Payments”)
|
New
November Principal Amount*
|
New
Monthly Redemption Amount for each of the New November
Debentures**
|
|
BridgePointe
Master Fund Ltd.
|
$1,027,451.37
|
$61,973.88
|
$1,307,310.30
|
$76,900.61
|
|
Enable
Opportunity Partners
|
$294,117.75
|
$17,647.07
|
$374,117.78
|
$22,006.93
|
|
Enable
Growth Partners
|
$2,500,000.88
|
$150,000.05
|
$3,180,001.11
|
$187,058.89
|
|
▇▇▇▇▇▇
Diversified Master Strategy Fund
|
$147,058.88
|
$8,823.53
|
$187,058.89
|
$11,003.46
|
*
= 120%
of the sum of (i) the Pre-Amendment Outstanding Principal plus (ii) the Waived
Interest Payments.
**
= the
New November Principal Amount, divided by seventeen (17)(not accounting for
any
accrued
but unpaid interest, liquidated damages and any other amounts then owing to
the
Holder in respect of this Debenture).
SCHEDULE
6, Continued . . .
DECEMBER
DEBENTURES
|
Name
of Investor
|
Principal
Amount of the December Debenture Outstanding Immediately Prior to
this
Agreement (the “Pre-Amendment Outstanding
Principal”)
|
Amount
of Interest Which Would Have Accrued from April 1, 2008 Through December
31, 2008 (“Waived Interest Payments”)
|
New
December Principal Amount*
|
New
Monthly
Redemption Amount for each of the New December
Debentures**
|
|
BridgePointe
Master Fund Ltd.
|
$588,235.50
|
$35,294.13
|
$748,235.56
|
$41,568.64
|
|
Enable
Opportunity Partners
|
$177,647.10
|
$7,058.83
|
$149,647.12
|
$8,313.73
|
|
Enable
Growth Partners
|
$1,058,823.90
|
$63,529.43
|
$1,346,824.00
|
$74,823.56
|
*
= 120%
of the sum of (i) the Pre-Amendment Outstanding Principal plus (ii) the Waived
Interest Payments.
**
= the
New December Principal Amount, divided by eighteen (18)(not accounting for
any
accrued
but unpaid interest, liquidated damages and any other amounts then owing to
the
Holder in respect of this Debenture).
SCHEDULE
13
NOVEMBER
WARRANT PERCENTAGE
|
Name
of Investor
|
November
Warrant Percentage
|
|
BridgePointe
Master Fund Ltd.
|
1.37%
|
|
Enable
Opportunity Partners
|
0.34%
|
|
Enable
Growth Partners
|
2.91%
|
|
▇▇▇▇▇▇
Diversified Master Strategy Fund
|
0.17%
|
DECEMBER
WARRANT PERCENTAGE
|
Name
of Investor
|
December
Warrant Percentage
|
|
BridgePointe
Master Fund Ltd.
|
0.68%
|
|
Enable
Opportunity Partners
|
0.14%
|
|
Enable
Growth Partners
|
1.23%
|