Exhibit 10.6
AMENDMENT NUMBER TWO
TO THE AGREEMENTS
THIS AMENDMENT NUMBER TWO TO THE AGREEMENTS (the "Amendment") is made
and entered into as of this ____ day of May, 2004, by and between FARADAY
FINANCIAL, INC., a Delaware corporation (the "Lender"), and VIDEO INTERNET
BROADCASTING CORPORATION, a Washington corporation (the "Company").
R E C I T A L S
A. The parties entered into an agreement captioned "Loan Agreement,"
effective February 17, 2004 (the "Loan Agreement"), pursuant to which the Lender
has lent the Company the principal amount of FIVE HUNDRED THOUSAND DOLLARS
($500,000).
B. The parties entered into an agreement captioned "Security
Agreement," dated March 12, 2004 (the "Security Agreement").
C. The parties entered into an agreement captioned "Intellectual
Property Security Agreement," effective March 30, 2004 (the "IP Security
Agreement").
D. The Loan Agreement, Security Agreement, IP Security Agreement and
the Initial Amendment (defined below) are sometimes hereinafter individually and
collectively referred to as the "Agreements."
E. The parties entered into an agreement captioned "Amendment Number
One to the Agreements," effective April ___, 2004 (the "Initial Amendment"),
pursuant to which the Lender lent the Company the additional principal amount of
TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000).
F. The parties desire to further amend the Agreements to reflect the
loan of up to an additional ONE MILLION FIVE HUNDRED THOUSAND DOLLARS
($1,500,000) in principal by Lender to the Company under the terms of the
Agreements.
G. All capitalized terms not otherwise defined herein, shall have the
meaning set forth in the Agreements.
IN CONSIDERATION of the premises and of the mutual covenants and
agreements hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
covenant and agree as follows:
1. Without altering or amending any other part of the Loan Agreement,
the second recital of the Loan Agreement is hereby amended to read in its
entirety as follows:
WHEREAS, Lender is willing to make periodic loans to Company
in the total aggregate principal amount of up to TWO MILLION TWO
HUNDRED FIFTY THOUSAND DOLLARS U.S. ($2,250,000 USD) upon the terms and
conditions set forth herein and Company is willing to borrow up to the
stated amount upon such terms.
2. Without altering or amending any other part of Section 2 of the Loan
Agreement or any other part of the Loan Agreement, Section 2.1 of the Loan
Agreement is hereby amended to read in its entirety as follows:
2.1 During the term hereof, unless Lender shall terminate this
Agreement upon an event of default under any Related Agreement, Lender
hereby agrees to make periodic loans (collectively and individually,
the "Loans") to Company in an aggregate principal amount at any one
time outstanding not to exceed TWO MILLION TWO HUNDRED FIFTY THOUSAND
DOLLARS (U.S.) ($2,250,000 USD) ("Maximum Amount"). Lender loaned the
Company the initial principal amount of TWO HUNDRED FIFTY THOUSAND
DOLLARS ($250,000) on or about the date of the Loan Agreement (the
"Initial Installment"). Subsequent to the Initial Installment, the
Lender loaned the Company the additional principal amount of FIVE
HUNDRED THOUSAND DOLLARS ($500,000). After the date hereof and subject
to the other terms and conditions set forth herein, up to an additional
SIX HUNDRED THOUSAND DOLLARS ($600,000) may be borrowed by the Company
from Lender, provided, however, that such amounts may only be used in
connection with the Company's agreement with Provo City relating to the
roll-out of certain internet services and other matters described
therein (the "Provo Agreement"). When additional funds are available to
the Lender to loan to the Company and subject to the other terms and
conditions set forth herein, additional amounts up to the Maximum
Amount will be available to the Company for draw through the term of
this Agreement provided, however, that such amounts may only be used in
connection with the Provo Agreement. In order for Company to draw down
funds subsequent to the Initial Installment, Company must notify Lender
at least ten days prior to the date on which Company is seeking borrow
additional funds and the aggregate amount of funds to be borrowed on
such date. All draws are also subject to the Company providing Lender
with reasonable assurances that the funds will be used for the purposes
described in this Section 2.1 and the purposes described in Section
9.7.
3. Without altering or amending any other part of Section 9 of the Loan
Agreement or any other part of the Loan Agreement, Section 9.7 of the Loan
Agreement is hereby amended to read in its entirety as follows:
Without the consent of Lender, Company will not use the
proceeds from the Initial Installment for any purposes other than those
set forth on Schedule 9.7a and it will not use the proceeds from any
Loan proceeds subsequent to the Initial Installment for any purposes
other than those set forth on Schedule 9.7b and such other purposes as
are agreed in advance in writing.
4. Without altering or amending any other part of the IP Security
Agreement, the first recital of the IP Security Agreement is hereby amended to
read in its entirety as follows:
WHEREAS, pursuant to that certain Loan Agreement, dated
February 17, 2004, (as amended, extended, modified, restructured or
renewed from time to time, the "Loan Agreement"), by and among Grantor
and Lender, Lender has agreed to make a loans in the aggregate
principal amount of up to $2,250,000 to Grantor which loans shall be
evidenced by promissory notes (together with any amendments,
extensions, modifications and/or renewals thereof and/or any promissory
notes given in payment thereof, the "Note") (capitalized terms used and
not otherwise defined herein shall have the meaning assigned to them in
the Loan Agreement);
5. The Agreements shall remain in full force and effect and shall
remain unaltered, except to the extent specifically amended in this Amendment.
6. This Amendment may be signed in several counterparts, through the
use of multiple signature pages appended to each original, and all such
counterparts shall constitute one and the same instrument. Any counterpart to
which is attached the signatures of all parties shall constitute an original of
this Amendment.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment to
be effective as of the date first written above.
COMPANY: VIDEO INTERNET BROADCASTING CORPORATION
By _________________________________
Its:
LENDER: FARADAY FINANCIAL, INC.
By /s/ Xxxxx Xxxxxx
Its:
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STATE OF _____________ )
ss:
COUNTY OF ___________ )
On this ____ day of ______________, 2004, before me appeared
____________, to me personally known, who being duly sworn did say that he/she
is the President of VIDEO INTERNET BROADCASTING CORPORATION, the within named
corporation, and that the instrument was signed in behalf of said corporation
and acknowledged the instrument to be the free act and deed of the corporation.
___________________________________
NOTARY PUBLIC
My Commission Expires: Residing at: _____________________
_________________________
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