Exhibit 10.3

FIRST AMENDMENT TO NOTE AND STOCK PURCHASE AGREEMENT

THIS FIRST AMENDMENT TO NOTE AND STOCK PURCHASE AGREEMENT (this “Amendment”) is
made as of September 14, 2009 by and between ONSTREAM MEDIA CORPORATION, a
Florida corporation (the “Company”) and ROCKRIDGE CAPITAL HOLDINGS LLC, a
Virginia limited liability company (the “Investor”).
 
Background
 
A.           Investor and Company are parties to that certain Note and Stock
Purchase Agreement dated April 14, 2009 (the “Purchase Agreement”).
 
B.           Company has requested that Investor make certain modifications to
the Purchase Agreement, and Investor has agreed to Company’s requests, subject
to the terms and conditions of this Amendment.
 
In consideration of the premises and the mutual covenants and conditions herein
contained, the parties hereby agree as follows:
1.           Definitions.  Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Purchase Agreement.
 
2.           Amendments.  All of the provisions of the Purchase Agreement shall
remain in full force and effect, except to the extent amended as follows:
 
(i)          The first WHEREAS clause is hereby deleted in its entirety and
replaced with the following:
 
“ WHEREAS, the Company desires to enter into this Agreement with the Investor to
sell and issue (i) a promissory Note of the Company in the principal amount of
up to $2,000,000.00 which Note shall be in the form attached hereto as Exhibit A
(as amended and in effect from time to time, the “Note”), and (ii) up to
2,200,000 restricted shares (the “Shares”) of Common Stock, par value $.0001 per
share (the “Common Stock”) of the Company”;
 
(ii)         All references in Section 1b. to “$1,000,000” are hereby deleted in
their entirety and replaced with “$2,000,000”;
 
(iii)        The reference in Section 1b. to “$250,000” is hereby deleted and
replaced with “$1,250,000”; and
 
(iv)        The fourth and fifth sentences of Section 1b. are hereby deleted and
replaced with the following:

 
 

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“As an origination fee for the Note, the Investor shall have the option to
require the Company to issue all or any portion of the Shares upon not less than
sixty-one (61) days prior written notice to the Company.  Upon receipt of such
written notice, the Company shall issue the Shares described in such notice to
the Investor on the date requested in such notice”.  The issuance of 500,000 out
of the 2,200,000 Shares is also subject to the further terms of such issuance
included in the Note”.  The issuance of any Shares of the Company hereunder is
subject to compliance with the prior notification to NASDAQ via an LAS filing,
the required LAS waiting period, and the ultimate approval by NASDAQ of that LAS
filing.
 
3.           Conditions Precedent.  The terms and conditions of this Amendment
are made contingent upon, and shall not become effective, unless and until:
 
(i)          Investor shall receive (a) this Amendment and (b) an Allonge to
Convertible Promissory Note, each in form and substance satisfactory to Investor
and its counsel, executed by Company;
 
(ii)         Company shall have executed that certain Marketplace365 End User
Agreement by and between the Company and Doctor’s Associates Inc. (“DAI”), in
form and substance satisfactory to DAI;
 
(iii)        Company shall have delivered to Investor (a) corporate resolutions
authorizing the transactions contemplated by this Amendment and (b) an opinion
of its counsel with respect to such transactions, each in form and substance
satisfactory to Investor and its counsel; and
 
(iv)        Company shall have delivered to Investor all such other documents as
Investor or its counsel reasonably require.

4.           Miscellaneous
 
(a)          Upon the execution of this Amendment, the Purchase Agreement and
the other Transaction Documents are restated to the extent that this Amendment
restates them and are amended to the extent that this Amendment amends
them.  Except as specifically amended by the terms of this Amendment, all terms
and conditions set forth in the Transaction Documents, together with all
schedules and exhibits attached thereto, shall remain in full force and
effect.  This Amendment, to the extent that it is inconsistent with the
Transaction Documents, supersedes the Transaction Documents and any and all
prior written and oral amendments of the Transaction Documents.
 
(b)          This Agreement shall inure to the benefit of and bind the parties
hereto and their respective legal representatives, heirs, administrators,
executors, successors and assigns.
 
(c)          This Agreement shall be governed by and construed in accordance
with the laws of the State of Connecticut, but not its conflict of laws
provisions.

 
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(d)          This Agreement may be executed in any number of counterparts, each
of which shall constitute an original and all of which taken together shall
constitute one instrument.
 
(e)          All costs incurred by Investor in connection with this Agreement
and the transactions contemplated herein, including without limitation the
reasonable fees and expenses of Investor’s counsel shall be paid by Company.

[SIGNATURE PAGE FOLLOWS]

 
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment the date
first written above.

COMPANY:
   
ONSTREAM MEDIA CORPORATION
   
By:
/s/ Randy S. Selman
 
Name:  Randy S. Selman
 
Title:    President and Chief Executive Officer
   
INVESTOR:
   
ROCKRIDGE CAPITAL HOLDINGS, LLC
   
By:
/s/ David Friedman
 
Name:  David Friedman
 
Title:    Managing Director

Signature Page to Rockridge/Onstream First Amendment

 
 

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