MODIFICATION OF AGREEMENT
This Modification of Agreement (this
“Modification”)
is made as of this 7th day of
March, 2008 by and between Biometrics Investors, L.L.C., a Delaware limited
liability company (“Lender”), and Sequiam
Corporation, a California corporation (“Borrower”).
WHEREAS, Lender and Borrower are
parties to that certain Agreement dated March 30, 2007 (the “Agreement”) pursuant
to which Biometrics agreed to loan Sequiam up to $11,500,000 pursuant to two
loans;
WHEREAS,
on March 30, 2007, Lender provided Borrower $6,500,000.00 in financing under the
first loan pursuant to the Agreement;
WHEREAS, as a condition to making
additional advances in an amount of at least $800,000 and not more than
$1,500,000 under the second loan, Lender requires that the Agreement be modified
as provided herein; and
WHEREAS, the parties hereto desire to
amend the Agreement to include the terms and conditions hereof.
NOW, THEREFORE, in consideration of the
foregoing, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties, the parties hereto
agree as follows:
1. Definitions. Capitalized
terms used herein, but not otherwise defined or modified herein, shall have the
meanings ascribed to them in the Agreement.
2. Amendment. The
Agreement is hereby amended by adding the following subsection (d) to Section 4
of the Agreement:
“(d) Notwithstanding
the foregoing conditions in Section 4(c), the following additional conditions
shall apply to any Term Loan B Cash Flow Advance:
(i) Borrower
shall use the proceeds from any Term Loan B Cash Flow Advance solely for the
working capital. Borrower may not use the proceeds of any Term Loan B Cash Flow
Advance to expand the business, hire new staff, or grant any raises or bonuses
to management. Borrower will pay Lender’s reasonable legal fees
associated with Term Loan B and any actions taken to enforce its security
interest under Term Loan B. Lender may reserve funds reasonably
anticipated to be necessary for such fees and pay them directly.
(ii) Borrower
shall accept Lender’s designation of Xxxxxxx Xxxxxxx as a consultant (the “Consultant”) to
Borrower to monitor the use of proceeds from any Term Loan B Cash Flow Advance
and advise Borrower of other capital raising opportunities. Borrower will give
the Consultant access to all company books and records upon request, but the
Consultant shall have no operational duties or authority with respect to
Borrower. The Consultant shall be compensated by Lender and not by
Borrower. Borrower will, however, pay reasonable travel expenses for
Consultant and other employees of Lender in connection with monitoring Term Loan
B.
(iii) Borrower
shall pay to Lender a facility fee equal to one percent (1%) of each additional
advance made under this modification, payable at the funding of each such
advance.”
3. Conflict. Except
as hereby amended, the Agreement shall remain unchanged and in full force and effect. If there is any
conflict between the terms and provisions of the Agreement and the terms and
provisions of this Modification, this Modification shall control.
4. Counterparts. This
Modification may be executed in any number of identical counterparts, any or all
of which may contain signatures of less than all of the parties, and all of
which shall be construed together as a single instrument.
BORROWER:
SEQUIAM
CORPORATION,
a
California corporation
By: _____________________________
Name: Xxxx
X. Xxxxxxxxxxx
Title: Executive
Vice President and
Chief Financial
Officer
LENDER:
BIOMETRICS
INVESTORS, L.L.C.,
By: ____________________________
Name: ____________________________
Title: ____________________________
