DUTCHESS CAPITAL MANAGEMENT, LLC
DUTCHESS
CAPITAL
MANAGEMENT, LLC
_______________________________________________________________________________________________________________________
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00
Xxxxxxxxxxxx Xxx, Xxxxx 0,
Xxxxxx, XX 00000
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0000
Xxxxx 00, Xxxxx
000, XxXxxxxxxxxxx, XX 00000
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Phone:
(000) 000-0000
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Phone
(000) 000-0000
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January
14, 2008
By
Facsimile, FedEx &
Electronic Mail
Xx.
Xxxx
Xxxxxxxx
Chief
Executive Officer
00
Xxxxxxxxxx Xxxxxx Xxxx
Bedminster,
NJ 07921
Re:
Amendment to Finance
Documents
Dear
Xx.
Xxxxxxxx:
For
the
limited purposes set forth below, this letter and attached exhibits shall
operate as an Amendment to: (i) the Promissory Note dated June 26, 2007 between
Dutchess Private Equities Fund, Ltd. (“Dutchess”), on the one hand, and
Bedminster National Corp. and all of its subsidiaries (“Bedminster” or the
“Company”), on the other (“Promissory Note”); and (ii) the Security Agreement
dated June 26, 2007 between Dutchess, on the one hand, and Bedminster and
Metropolitan Computing Corp. (“MCC”), on the other (collectively, the
“Agreements”). The Agreements remain in full force and effect, except
as set forth below, and any other financing agreements between Dutchess and
Bedminster, including, without limitation, the Negative Pledge dated June
26,
2007 and Secured Continuing Unconditional Guaranty dated June 26, 2007, remain
in full force and effect and are not effected in any way by this
Amendment.
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1)
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Bedminster
shall provide a warrant to Dutchess to purchase up to 8,584,000
shares of
common stock with an exercise price of par. Bedminster shall
execute the Warrant, attached as ExhibitA,
and return
it to Dutchess no later than 5 pm, Monday, January 14,
2008.
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2)
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Xxxx
Xxxxxxxx, and those entities under the control of Xx. Xxxxxxxx
(collectively “Patrizio”), will pledge all Bedminster shares held by them,
regardless of Class (the “Shares”), to Dutchess. Xx. Xxxxxxxx
shall execute the Share Pledge Agreement, attached as ExhibitB,
and return
it to Dutchess no later than 5 pm, Monday, January 14, 2008. By
signing below, Xx. Xxxxxxxx acknowledges that the attached Share
Pledge
Agreement and Schedule I to the Share Pledge Agreement includes
all shares
held by Xx. Xxxxxxxx and any entities controlled by Xx.
Xxxxxxxx. Xx. Xxxxxxxx shall also execute the Escrow Agreement,
attached as ExhibitC,
and return
it to Dutchess no later than 5 pm, Monday, January 14,
2008.
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1
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3)
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Bedminster
acknowledges that it has failed to make at least three required
payments
under the Promissory Note, totaling approximately $147,005, and
that its
current indebtedness to Dutchess is approximately $1,327,611.92
as of
January 10, 2008.
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4)
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Bedminster
shall timely make the payments set forth below to Dutchess with
monthly
payments due on or before the first day of each
month:
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January
15, 2008
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Five
thousand dollars ($5,000)/month
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February
1, 2008 – April 1, 2008
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Five
thousand dollars ($5,000)/month
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May
1, 2008 – June 1, 2008
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Interest
only payments based upon outstanding principal on the Promissory
Note/month
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July
1, 2008 – December 1, 2008
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Twenty-five
thousand dollars ($25,000)/month
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January
1, 2009 – March 1, 2009
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Forty
thousand dollars ($40,000)/month
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April
1, 2009 – June 1, 2009
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Fifty
thousand dollars ($50,000)/month
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July
1, 2009 and each month
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Seventy
thousand dollars ($70,000)/month
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thereafter
until the Face Amount
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is
paid in full
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5)
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If,
at any time after Closing, the Company receives financing from
a third
party (excluding Dutchess), the Company is required to pay to Dutchess
twenty percent (20%) of the proceeds raised from the third party
up to an
aggregate amount of $3,000,000 (the “Threshold Amount”), and 100% of the
proceeds raised from the third party in excess of the Threshold
Amount. The Threshold Amount shall also pertain to any assets
sold, transferred or disposed of by the Company. The Company
agrees to pay twenty percent (20%) of any proceeds raised by the
Company
up to the Threshold Amount and one hundred percent (100%) of any
proceeds
raised by the Company in excess of the Threshold Amount toward
the
Accelerated Repayment of the Promissory Note with Interest until
such time
as the Face Amount of the Promissory Note, including accrued interest
and
penalties, has been paid in full. The accelerated Repayment
shall be made to Dutchess upon the Company’s receipt of the
financing.
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and;
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6)
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The
Company and Xxxxxxxx acknowledge that the failure to meet any of
the
obligations as described herein constitutes an Event of Default
under the
Agreements, and that in the Event of Default, the Escrow Agent
shall be
obligated to deliver the Shares to
Dutchess.
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For
good
and valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties have caused this Amendment to be duly executed
by its
authorized officer as of the date indicated above.
2
DUTCHESS
PRIVATE EQUITIES FUND, LTD.
By:__________________________
Name: Xxxxxxx
X. Xxxxxxxx
Title: Director
Agreed
to:
XXXX
XXXXXXXX and BEDMINSTER NATIONAL CORP., on behalf of itself and its
subsidiaries,
By:
_________________________
Name:
Xxxx Xxxxxxxx, individually and as
Chief
Executive Officer
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