Common use of Second Tranche Clause in Contracts

Second Tranche. (a) Subject to Section 9.1(b), at the Lender's sole discretion, the Lender may increase the amount of outstanding Principal under this Loan by an additional Two Million Dollars ($2,000,000), which additional amount shall comprise the Second Tranche, by providing this amount to the Borrower in cash or readily available funds, and the Borrower shall issue to the Lender two million (2,000,000) warrants for the purchase of an aggregate Two Million (2,000,000) shares of the Borrower's common stock (the "Additional Warrants"). The Additional Warrants shall be exercisable until 5:00 PM Pacific Time three (3) years from the Effective Date and shall be evidenced by one or more warrant certificates substantially in the form of Schedule B, attached hereto, with an exercise price of Twenty-One Cents ($0.21) per share. The Borrower expressly agrees that the Loan may be increased by the Second Tranche at the sole discretion of the Lender, and Borrower agrees to accept the additional principal amount of the Second Tranche on the terms and conditions set forth herein, provided that the Loan shall also be increased by the Second Tranche pursuant to the terms of Subsection 9.1(b). (b) Subject to Section 10 hereof, in the event that the Borrower achieves the Benchmarks (defined below) on or before December 31, 2008, and the full amount of the Second Tranche shall not have already been provided to Borrower by Lender, then the Lender shall increase the amount of outstanding Principal under the Loan by the amount of the Second Tranche. The Second Tranche shall be subject to all of the terms and conditions contained in this Agreement with respect to the First Tranche. For the purpose of this Section 9.1, the Borrower shall have achieved the "Benchmarks" if all of the following have been accomplished (as determined by the Lender in its reasonable discretion): 9.1.1 The Borrower has sold at least one million (1,000,000) gallons of its Alderox product during calendar year 2008; 9.1.2 The Borrower has signed orders or contracts for the sale of at least one million (1,000,000) gallons of Alderox during calendar year 2009, or the Borrower has the reasonable expectation of selling at least one million (1,000,000) gallons of Alderox during calendar year 2009 based on signed orders for the sale of Alderox in calendar year 2009 and/or existing customer accounts; and 9.1.3 The Borrower has reached a gross profit margin of Five Dollars ($5.00) per gallon on its total sales of Alderox as calculated according to U.S. Generally Accepted Accounting Procedures in effect at the time in calendar year 2008. At the time of the drawdown of the Second Tranche the Borrower shall complete a "Drawdown Certificate" in the form of Schedule I, attached hereto, and return to the Lender. The Drawdown Certificate shall confirm that all of the conditions precedent in Section 10 have been satisfied at the time of the drawdown.

Second Tranche. At any time on or after the Closing Date but prior to the earlier to occur of (x) January 23, 2023 and (y) the termination of all unused Note Purchase Commitments and payment in full of all Obligations (other than contingent indemnification obligations for which no claim has been asserted) under the Note Documents, upon prior written notice by the Issuer to the Administrative Agent, the Issuer may institute the Second Tranche in an aggregate amount not to exceed TWENTY-FIVE MILLION DOLLARS ($25,000,000); provided, that, (a) Subject to Section 9.1(b), at the Lender's sole discretion, the Lender may increase the amount of outstanding Principal under this Loan by an additional Two Million Dollars ($2,000,000), which additional amount Issuer shall comprise the Second Tranche, by providing this amount to the Borrower in cash or readily available funds, and the Borrower shall issue to the Lender two million (2,000,000) warrants have obtained commitments for the purchase of an aggregate Two Million (2,000,000) shares of the Borrower's common stock (the "Additional Warrants"). The Additional Warrants shall be exercisable until 5:00 PM Pacific Time three (3) years from the Effective Date and shall be evidenced by one or more warrant certificates substantially in the form of Schedule B, attached hereto, with an exercise price of Twenty-One Cents ($0.21) per share. The Borrower expressly agrees that the Loan may be increased by the Second Tranche at the sole discretion of the Lender, and Borrower agrees to accept the additional principal amount of the Second Tranche on from existing Purchasers or other Persons reasonably acceptable to the terms and conditions set forth hereinAdministrative Agent, provided that the Loan which Purchasers shall also be increased by the Second Tranche join in this Agreement pursuant to such agreements as are reasonably acceptable to the terms of Subsection 9.1(b).Administrative Agent; (b) Subject to Section 10 hereof, in the event that the Borrower achieves the Benchmarks (defined below) on or before December 31, 2008, and the full amount any such institution of the Second Tranche shall not have already been provided to Borrower by Lender, then the Lender shall increase the be in a minimum aggregate principal amount of outstanding Principal under $10,000,000 and integral multiples of $1,000,000 in excess thereof; (i) no Default or Event of Default shall exist and be continuing at the Loan by time of such institution, (ii) the amount Second Tranche shall only be used to fund the Transformative Acquisition and to pay fees and expenses in connection therewith and (iii) the conditions precedent set forth in Section 5.03 shall have been satisfied prior to or contemporaneously with the purchase of the Second Tranche. The Tranche Notes; (d) (i) the final maturity date with respect to the Second Tranche Notes shall be the Maturity Date, (ii) the scheduled principal amortization payments for the Second Tranche shall be subject as set forth in Section 2.05(b) and (iii) the interest rate, repayment premiums and exit fees for the Second Tranche shall be identical to all of the terms interest rate, repayment premiums and conditions contained in this Agreement with respect to exit fees, as the case may be, for the First Tranche. For ; (e) the purpose of this Section 9.1, the Borrower Issuer shall have achieved the "Benchmarks" if paid all of the following have been accomplished (as determined by the Lender fees and original issue discount required to be paid in its reasonable discretion): 9.1.1 The Borrower has sold at least one million (1,000,000) gallons of its Alderox product during calendar year 2008connection therewith, including pursuant to Section 2.07(a); 9.1.2 The Borrower has signed orders or contracts for (f) Schedule 2.01 shall be deemed revised to reflect the sale of at least one million (1,000,000) gallons of Alderox during calendar year 2009, or the Borrower has the reasonable expectation of selling at least one million (1,000,000) gallons of Alderox during calendar year 2009 based on signed orders for the sale of Alderox in calendar year 2009 and/or existing customer accounts; and 9.1.3 The Borrower has reached a gross profit margin of Five Dollars ($5.00) per gallon on its total sales of Alderox as calculated according to U.S. Generally Accepted Accounting Procedures in effect at the time in calendar year 2008. At the time of the drawdown commitments and commitment percentages of the Second Tranche the Borrower shall complete a "Drawdown Certificate" Note Purchasers, as set forth in the form Second Tranche Joinder Agreement; (g) no Purchaser shall be obligated to participate in the Second Tranche, which decision shall be made in the sole discretion of Schedule Ieach Purchaser; (h) the Second Tranche Purchasers, attached heretothe Administrative Agent and the Credit Parties shall have entered into (i) the Second Tranche Joinder Agreement and (ii) such technical amendments to this Agreement as are necessary, in the Administrative Agent’s reasonable discretion, to effect the inclusion of the Second Tranche herein; and (i) as a condition precedent to such institution of the Second Tranche and the effectiveness of the Second Tranche Joinder Agreement, the Issuer shall have delivered to the Administrative Agent a certificate of each Credit Party dated as of the date of such institution and effectiveness (in sufficient copies for each Purchaser) signed by a Responsible Officer of such Credit Party (i) certifying and attaching the resolutions adopted by such Credit Party approving or consenting to the Second Tranche, and return (ii) certifying that, before and after giving effect to the Lender. The Drawdown Certificate shall confirm that all issuance of the conditions precedent Second Tranche Notes, (x) the representations and warranties contained in Section 10 have been satisfied at Article VI and the time other Note Documents are true and correct in all material respects (and in all respects if any such representation or warranty is already qualified by materiality or reference to Material Adverse Effect) on and as of the drawdowndate of such issuance, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (and in all respects if any such representation or warranty is already qualified by materiality or reference to Material Adverse Effect) as of such earlier date, and except that for purposes of this Section 2.13, the representations and warranties contained in subsections (a) and (b) of Section 6.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 7.01, and (y) no Default or Event of Default exists.

Second Tranche. At the Company's option (a) Subject to Section 9.1(b), at the Lender's sole discretion, the Lender may increase the amount of outstanding Principal under this Loan by an additional Two Million Dollars ($2,000,000), which additional amount shall comprise the Second Tranche, by providing this amount to the Borrower in cash or readily available funds, and the Borrower shall issue to the Lender two million (2,000,000) warrants for the purchase of an aggregate Two Million (2,000,000) shares of the Borrower's common stock (the "Additional Warrants"). The Additional Warrants shall must be exercisable until 5:00 PM Pacific Time three (3) years from the Effective Date and shall be evidenced by one or more warrant certificates substantially in the form of Schedule B, attached hereto, with an exercise price of Twenty-One Cents ($0.21) per share. The Borrower expressly agrees that the Loan may be increased by the Second Tranche at the sole discretion written notice to each of the Lender, and Borrower agrees Investors at least five Business Days prior to accept the additional principal amount Closing of the Second Tranche on setting forth the dollar amount which shall be a minimum of $1,000,000 and a maximum of $3,000,000) the Company will sell and the Investors will buy, in reliance upon the representations and warranties contained in this Agreement, and upon the terms and satisfaction of each of the conditions set forth below, that number of Secondary Shares derived from dividing the dollar amount set forth in the Company's option notice by the Issuance Price (pro rata amongst the Investors based upon each Investor's First Tranche Purchase Price), after the earlier to occur of (y) 165 calendar days after the Subscription Date, and (z) two Business Days after the expiration of the second Reset Period for the Initial Shares, upon the satisfaction of each of the following conditions (the Company must exercise this option within 20 calendar days after the earlier of (y) and (z) herein): (A) Delivery into escrow by the Company of the original Secondary Shares, provided that as more fully set forth in the Loan Escrow Agreement attached hereto; (B) The Investors shall also be increased by have received an opinion of counsel of the Company as set forth in Exhibit D annexed to this Agreement, dated on the Second Tranche pursuant Closing Date; (C) The Registration Statement (which includes at least 150% of the Initial Shares which have not yet been subject to a Reset Period, 100% of the Initial Shares that were subject to a Reset Period, 150% of the Secondary Shares, and 100% of the Warrant Shares) has previously become effective and remains effective for at least 40 calendar days and during the ten (10) Trading Days immediately prior to the terms Company's notice for the Second Tranche and the Second Tranche Closing Date, and (A) neither the Company nor any of Subsection 9.1(bthe Investors shall have received notice that the SEC has issued or intends to issue a stop order with respect to the Registration Statement or that the SEC otherwise has suspended or withdrawn the effectiveness of the Registration Statement, either temporarily or permanently, or intends or has threatened to do so (unless the SEC's concerns have been addressed and the Investors are reasonably satisfied that the SEC no longer is considering or intends to take such action)., and (B) no other suspension of the use or withdrawal of the effectiveness of the Registration Statement or related prospectus shall exist; (D) The Company shall have obtained all permits and qualifications required by any state for the offer and sale of the Secondary Shares, or shall have the availability of exemptions therefrom. The sale and issuance of the Secondary Shares shall be legally permitted by all laws and regulations to which the Company is subject; (E) The Investors shall have received written certification that the representations and warranties of the Company contained in this Agreement and all Exhibits annexed hereto are true and correct in all material respects as of the Second Tranche Closing Date as though made at each such time (except for representations and warranties specifically made as of a particular date) with respect to all periods, and as to all events and circumstances occurring or existing to and including the Second Tranche Closing Date; (F) The Company shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement, the Escrow Agreement, the Registration Rights Agreement and the Warrants, to be performed, satisfied or complied with by the Company at or prior to the Second Tranche Closing Date; (G) No statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by any court or governmental authority of competent jurisdiction that prohibits or directly and adversely affects any of the transactions contemplated by this Agreement or the Exhibits annexed hereto, and no proceeding shall have been commenced that may have the effect of prohibiting or adversely affecting any of the transactions contemplated by this Agreement or the Exhibits annexed hereto; (H) The trading of the Common Stock is not suspended by the SEC or the Principal Market, and the Common Stock shall not have been delisted from the OTC Bulletin BoardThe Company currently meets all applicable listing requirements of the Principal Market; (I) No change of control in the Company shall have occurred. Change of Control shall mean the occurrence of any of (a) an acquisition after the Subscription Date by a Person of in excess of 50% of the voting securities of the Company, (b) Subject a replacement of more than one half of the board of directors in place as of the Subscription Date which is not approved by those individuals who are members of the board of directors on the Subscription Date in one or a series of transactions, (c) the merger of the Company with, or into another entity, consolidation or sale of all or substantially all of the assets of the Company in one or a series of related transactions, or (d) the execution by the Company of an agreement to Section 10 hereofwhich the Company is a party or by which it is bound, providing for any of the events set forth in (a), (b) or (c) herein; (J) The average Bid Price for the 20 consecutive Trading Days immediately preceding the notice by the Company of its intention to proceed with the second tranche and the days immediately preceding the Second Tranche Closing Date shall be greater than $1.25; (K) The average daily trading volume for the Common Stock as reported by Bloomberg, LP for the 20 Trading Days immediately preceding the Company's notice for the Second Tranche and preceding the Closing for the second tranche shall be a minimum of 100,000; and (L) None of the Investor's, in the event that the Borrower achieves the Benchmarks (defined below) on or before December 31, 2008, and the full amount of the Second Tranche shall not have already been provided to Borrower by Lender, then the Lender shall increase the amount of outstanding Principal under the Loan by the amount Closing of the Second Tranche. The Second Tranche shall Secondary Shares would own or be subject deemed beneficially deemed to all own, more than 9.99% of the terms and conditions contained in this Agreement with respect to the First Tranche. For the purpose outstanding shares of this Section 9.1, the Borrower shall have achieved the "Benchmarks" if all of the following have been accomplished (as determined by the Lender in its reasonable discretion): 9.1.1 The Borrower has sold at least one million (1,000,000) gallons of its Alderox product during calendar year 2008; 9.1.2 The Borrower has signed orders or contracts for the sale of at least one million (1,000,000) gallons of Alderox during calendar year 2009, or the Borrower has the reasonable expectation of selling at least one million (1,000,000) gallons of Alderox during calendar year 2009 based on signed orders for the sale of Alderox in calendar year 2009 and/or existing customer accounts; and 9.1.3 The Borrower has reached a gross profit margin of Five Dollars ($5.00) per gallon on its total sales of Alderox as calculated according to U.S. Generally Accepted Accounting Procedures in effect at the time in calendar year 2008. At the time of the drawdown of the Second Tranche the Borrower shall complete a "Drawdown Certificate" in the form of Schedule I, attached hereto, and return to the Lender. The Drawdown Certificate shall confirm that all of the conditions precedent in Section 10 have been satisfied at the time of the drawdownCommon Stock.

Second Tranche. (ai) Subject to and in reliance upon the representations and warranties set forth in Section 9.1(b), at the Lender's sole discretion, the Lender may increase the amount of outstanding Principal under this Loan by an additional Two Million Dollars ($2,000,000), which additional amount shall comprise the Second Tranche, by providing this amount to the Borrower in cash or readily available funds3 below, and the Borrower satisfaction (or waiver) of the conditions set forth in Section 6(b) and Section 7(b), below, (i) the Company and ATG US, as applicable, shall issue and sell to Buyer, and Buyer agrees to purchase on the Lender two million Second Tranche Payment Date, the following: (2,000,000A) warrants for the second Promissory Note in the principal amount of $2,500,000 (the “Secondary Promissory Note”) from ATG US, (B) Warrants to purchase an additional 3,250,000 shares of Common Stock of the Company (the “Secondary Warrants”) from the Company and (C) an additional 3,250,000 Yield Enhancement Shares (the “Secondary Yield Enhancement Shares”) from the Company. The aggregate purchase price of the Secondary Promissory Note and Secondary Warrants to be purchased by Buyer on the Second Tranche Payment Date shall be equal to $2,500,000 (the “Second Note Payment”). The aggregate purchase price of the Secondary Yield Enhancement Shares to be purchased by Buyer on the Second Tranche Payment Date shall be equal to $1,000 (the “Second Yield Enhancement Payment”). The closing (the “Second Tranche Closing”) of the purchase of an aggregate Two Million (2,000,000) shares the Secondary Promissory Note, Secondary Warrants and Secondary Yield Enhancement Shares by Buyer shall occur at the offices of the Borrower's common stock (the "Additional Warrants"). The Additional Warrants shall be exercisable until 5:00 PM Pacific Time three (3) years from the Effective Date Xxxxxx and shall be evidenced by one or more warrant certificates substantially in the form of Schedule BXxxx LLP, attached hereto0000 Xxxx Xxxxxx, with an exercise price of Twenty-One Cents ($0.21) per share. The Borrower expressly agrees that the Loan may be increased by Xxxxxx, Xxxxx 00000 on the Second Tranche Payment Date at 10:00 a.m., local time. (ii) At the Second Tranche Closing, (1) Buyer shall pay the Second Note Payment to the Company and the Escrow Agent, as applicable, pursuant to Section 1(c)(iii) for the Secondary Promissory Note and Secondary Warrants and shall pay the Second Yield Enhancement Payment for the Secondary Yield Enhancement Shares to be issued and sold to Buyer at the sole discretion Second Tranche Closing, by wire transfer of immediately available funds in accordance with the Company’s and Escrow Agent’s (as applicable) written wire instructions, (2) the Company shall deliver to Buyer the Secondary Promissory Note, Secondary Warrants and a stock certificate representing the Secondary Yield Enhancement Shares which Buyer is purchasing, duly executed on behalf of the Lender, Company and Borrower agrees to accept registered in the additional principal name of Buyer. (iii) The entire amount of the Second Tranche on Note Payment will be paid into the terms and conditions set forth herein, provided that the Loan shall also be increased Escrow Account by Buyer at the Second Tranche Closing, to be immediately released and paid to the Company pursuant to the terms of Subsection 9.1(b)the Escrow Agreement. (b) Subject to Section 10 hereof, in the event that the Borrower achieves the Benchmarks (defined below) on or before December 31, 2008, and the full amount of the Second Tranche shall not have already been provided to Borrower by Lender, then the Lender shall increase the amount of outstanding Principal under the Loan by the amount of the Second Tranche. The Second Tranche shall be subject to all of the terms and conditions contained in this Agreement with respect to the First Tranche. For the purpose of this Section 9.1, the Borrower shall have achieved the "Benchmarks" if all of the following have been accomplished (as determined by the Lender in its reasonable discretion): 9.1.1 The Borrower has sold at least one million (1,000,000) gallons of its Alderox product during calendar year 2008; 9.1.2 The Borrower has signed orders or contracts for the sale of at least one million (1,000,000) gallons of Alderox during calendar year 2009, or the Borrower has the reasonable expectation of selling at least one million (1,000,000) gallons of Alderox during calendar year 2009 based on signed orders for the sale of Alderox in calendar year 2009 and/or existing customer accounts; and 9.1.3 The Borrower has reached a gross profit margin of Five Dollars ($5.00) per gallon on its total sales of Alderox as calculated according to U.S. Generally Accepted Accounting Procedures in effect at the time in calendar year 2008. At the time of the drawdown of the Second Tranche the Borrower shall complete a "Drawdown Certificate" in the form of Schedule I, attached hereto, and return to the Lender. The Drawdown Certificate shall confirm that all of the conditions precedent in Section 10 have been satisfied at the time of the drawdown.