AMENDMENT NO. 4 TO CONVERTIBLE DEBENTURES
AMENDMENT
NO. 4 TO CONVERTIBLE DEBENTURES
This
Amendment No. 4 (“Amendment”)
is
made as of May 7, 2007 to the Convertible Debentures (collectively, the
“Convertible
Debentures”)
issued
under the
Securities Purchase Agreement dated August 28, 2006 (the “SPA”)
by and
between Cornell Capital Partners, LP (“Cornell
Capital”)
and
Mobilepro Corp. (the “Company”)
for
loans totaling $7,000,000 from Cornell Capital.
WHEREAS,
the
Company has been paying to Cornell Capital weekly payments of $300,000 in
principal payments plus interest on the outstanding principal balance of the
Convertible Debentures commencing April 5, 2007 in place of the original amount
of $125,000 in scheduled payments commencing January 2, 2007 (the “Scheduled
Payments”)
in
accordance with Amendment No. 3 to Convertible Debenture dated April 2, 2007
between the Company and Cornell Capital;
WHEREAS,
the
Company has registered 120,689,655 shares of its common stock under a Form
S-3
to allow for conversion of the Convertible Debentures and has been making the
Scheduled Payments in the form of its common stock under the terms of the
Convertible Debentures;
WHEREAS,
the
Company expects to engage in a transaction within the next few weeks that will
generate sufficient cash by July 1, 2007 to pay the principal and interest
owed
to Cornell Capital under the Convertible Debentures and the convertible
debenture dated June 30, 2006 issued by the Company to Cornell Capital in the
principal amount of $15,149,650, as amended; and
WHEREAS,
the
parties to this Agreement desire to amend the Convertible Debentures to allow
for the Scheduled Payments to be deferred until July 1, 2007.
NOW
THEREFORE,
in
consideration of the foregoing, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
Section
1. Amendment
to Section 1.02 of the Convertible Debentures.
Section
1.02
of the
Convertible Debentures is hereby amended and restated in its entirety as
follows:
Section
1.02 Payments.
(a) The
Company shall make weekly scheduled payments (“Scheduled
Payments”)
consisting of at least $125,000 of principal, commencing with the first
Scheduled Payment which shall be due and payable on July 1, 2007. Interest
payments on the outstanding principal balance hereof shall be due and payable
with the principal payment installments above. The Company shall have the right
to make each Scheduled Payment in shares of Common Stock, which shares shall
be
valued at the lower of the Conversion Price then in effect or a price equal
to a
seven percent (7%) discount to the average of the two lowest daily volume
weighted average prices of the Common Stock as quoted by Bloomberg, LP for
the
five (5) trading days immediately following the Scheduled Payment date (the
“Payment
Conversion Price”),
provided
that
such shares are either (i) freely tradeable under Rule 144 of the Securities
and
Exchange Commission (the “Commission”),
(ii)
registered for sale under the Securities Act of 1933, or (iii) freely tradeable
without restriction in the hands of the Holder. All payments in respect of
the
indebtedness evidenced hereby shall be made in collected funds (unless paid
in
shares of Common Stock) and shall be applied to principal, accrued interest
and
charges and expenses owing under or in connection with this Debenture in such
order as the Holder elects, except that payments shall be applied to accrued
interest before principal. Notwithstanding the foregoing, this Debenture shall
become due and immediately payable, including all accrued but unpaid interest,
upon an Event of Default (as defined in Section
3.01
hereof).
Whenever any payment or other obligation hereunder shall be due on a day other
than a business day, such payment shall be made on the next succeeding business
day. Time is of the essence of this Debenture. The Company shall be permitted
to
prepay any amounts owed under this Debenture if the price of the shares of
the
Company’s Common Stock is less than $0.275 per share and also may, at its
option, increase any scheduled payment to $750,000 (payable in cash or Common
Stock as set forth above) without incurring any penalties or fees. Nothing
contained in this paragraph shall limit the amount that the Holder can convert
at any time.
Section
2. Effect
of Amendment.
Except
as amended hereby, the Convertible Debentures shall continue in full force
and
effect and are
hereby
incorporated herein by this reference.
Section
3.
Governing Law.
This
Amendment shall be governed by and construed under the laws of the State of
New
Jersey.
Section
4.
Titles and Subtitles.
The
titles of the sections and subtiles of this Amendment are for convenience of
reference only and are not to be considered in construing this
Amendment.
Section
5.
Counterparts.
This
Amendment may be executed in counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same
instrument.
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be signed
as
of the date first set forth above.
MOBILEPRO CORP. | ||
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By: | /s/ Xxxxxxx X. Xxxxx | |
Name: Xxxxxxx X. Xxxxx |
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Title: Senior Vice President |
CORNELL CAPITAL PARTNERS, LP | ||
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By: | Yorkville Advisors, LLC | |
Its: | General Partner |
By: | /s/ Xxxx X. Xxxxx | |
Name: Xxxx X. Xxxxx |
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Its: Managing Director |