September 15, 2003 - Letter to Weichert and DL Holdings






	





[COMPANY LOGO]













	 		September 15, 2003







	




Weichert Enterprise LLC

1625 State Route 10 

Morris Plains, New Jersey 07950

Attn: Gerald C. Crotty, President 



DL Holdings I, LLC

c/o Reservoir Capital
650 Madison Avenue

New York, New York 10022

Attn: Marc A. Schwartz, Vice President 












		
		Re:		Eos International, Inc./Weichert Enterprise LLC/

DL Holdings I, LLC







	



        Reference
is made to the Agreement by and among Eos International, Inc. (“Eos”),
Weichert Enterprise LLC (“Weichert”), and DL Holdings I, LLC (“DL
Holdings,” and together with Weichert, the “Former Bridge
Lenders”), dated as of January 14, 2003 (the “Agreement”),
pursuant to which (i) the Former Bridge Lenders exchanged certain Eos notes payable and
warrants to purchase shares of Eos common stock held by the Former Bridge Lenders for
cash, shares of Eos Series D Preferred Stock (“Series D Preferred
Stock”), and new warrants to purchase shares of Eos common stock, and (ii) Eos
segregated $1.2 million (the “Redemption Account Funds”) into an
account selected with the approval of the Former Bridge Lenders, to be used solely for
purposes specified in the Agreement as “Qualified Expenses” (“Qualified
Expenses”). 



        Section
3 of the Agreement provides that the Redemption Account Funds may only be used for paying
Qualified Expenses or redeeming outstanding shares of Series D Preferred Stock, and that
Qualified Expenses include, in addition to the other uses specified in Section 3, any
expenditures upon which the parties mutually agree. 



        Eos
and each of the Former Bridge Lenders hereby agree that the expenditures set forth on
Schedule A attached hereto (“Schedule A”) constitute Qualified
Expenses and that Eos may use $225,000.00 of the Redemption Account Funds for the
expenditures set forth on Schedule A. 



        By
countersigning this agreement where indicated below and returning it to Eos, each of the
Former Bridge Lenders agrees to, and accepts, the terms of this agreement. 
















	





        Please
indicate your confirmation of the foregoing by signing where indicated below and promptly
returning this letter to Eos. 











	 		Sincerely,

EOS INTERNATIONAL, INC.



By:  PETER A. LUND
——————————————

Name:        Peter A. Lund

Title:         Chairman









	AGREED UPON AND ACCEPTED BY:


WEICHERT ENTERPRISE LLC



By:  GERALD C. CROTTY
——————————————

Name:        Gerald C. Crotty

Title:         President		






	


DL HOLDINGS I, LLC



By:  MARC A. SCHWARTZ
——————————————

Name:       Marc A. Schwartz

Title:         Authorized Signatory		














	


Schedule A



2003 Update (8/31/03)


Use of Proceeds Through October 31, 2003 (Eos Only)

(Thousands of Dollars)










		8/14/03	8/14 to
8/31/03
Activity	Carryover
August	September	October	Total
Carryover Aug.-
Oct. 2003
		
		
		
		
		
		
	
	Remaining Operating Funds	 	 	 		 	 		 	 		 	 		 	 		 	 	 	 
	        Eos Chase Operating	 	 	 	62	 	 	-2	 	 	60	 	 		 	 		 		 	 
	        USB Paine Webber	 	 	 	27	 	 	0	 	 	27	 	 		 	 		 		 	 
		
		
		
						 	
	        Total Operating Accounts	 	 	 	89	 	 	-2	 	 	87	 	 		 	 		 		 	 
	Redemption Account	 	 	 	988	 	 	-32	 	 	956	 	 		 	 		 		 	 
		
		
		
							
	        Total Accounts	 	 	 	1,077	 	 	-34	 	 	1,043	 	 		 	 		 		 	 
	 	 	 
	Operating Expenses Payment Schedule	 	 
	 	 	 
	From Operating Accounts	 	 
	        Beginning Balance	 	 	 	 	 	 	89	 	 	87	 	 	73	 	 	44	 
	        New York Staff Incl. Fringe	 	 	 	 	 	 	6	 	 	0	 	 	12	 	 	12	 	24
	        New York Office Rent	 	 	 	 	 	 	20	 	 	0	 	 	10	 	 	10	 	20
	        Other (Cobra Reimburse.)	 	 	 	 	 	 	-2	 	 	0	 	 	-1	 	 	-1	 	-2
	        Travel	 	 	 	 	 	 	 	 	 	0	 	 	2	 	 	5	 	7
	        Regal Mgmt. Fee	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	-88	 	-88
	        Other	 	 	 	 	 	 	4	 	 	14	**	 	6	 	 	7	 	27
	        Transfer from Restricted Account	 	 	 	 	 	 	-33	 	 	 	 	 	 	 	 	 	 	0
	        Other Transfer to Payroll Account	 	 	 	 	 	 	7	 	 	 	 	 	 	 	 	 	 	0
		 		
		
		
		
		
	
	        Total Net Payments	 	 	 	 	 	 	2	 	 	14	 	 	29	 	 	-55	 	-12
		 		
		
		
		
		
	
	        Ending Balance	 	 	 	 	 	 	87	 	 	73	 	 	44	 	 	99	 	 
		 		
		
		
		
		 	
	From Redemption Account	 	 
	        Beginning Balance	 	 	 	 	 	 	988	 	 	956	 	 	843	 	 	726	 	 
	        Accounting Staff Incl. Fringe	 	 	 	 	 	 	19	 	 	0	 	 	19	 	 	19	 	38
	        CEO	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	27	*	27
	        CFO	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	19	*	19
	        Recruiting Fees	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	0
	     
   Interest Income	 	 	 	 	 	 	-1	 	 	 	 	 	 	 	 	 	 	0
	        Investment Banking Expenses	 	 	 	 	 	 	14	 	 	0	 	 	 	 	 	 	 	0
		 		
		
		
		
		
	
	               Total Approved	 	 	 	 	 	 	32	 	 	0	 	 	19	 	 	65	 	84	 
	        Legal Fees (Pitney)	 	 	 	 	 	 		 	 	81	 	 	73	 	 	38	 	192	 
	        Legal Fees (Other)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7	 	7
	        Accounting Fees (BDO)	 	 	 	 	 	 	 	 	 	32	 	 	20	 	 	 	 	52	 
	        Accounting Fees (Other)	 	 	 	 	 	 		 	 		 	 	5	 	 		 	5	 
	        Printing (Reg. Stmt.)	 	 	 	 	 	 		 	 		 	 		 	 	20	 	20	 
		 		
		
		
		
		
	
	               Total Other	 	 	 	 	 	 	0	 	 	113	 	 	98	 	 	65	 	276	 
		 		
		
		
		
		
	
	        Total Net Payments	 	 	 	 	 	 	32	 	 	113	 	 	117	 	 	130	 	360	 
		 		
		
		
		
		
	
	        Ending Balance	 	 	 	 	 	 	956	 	 	843	 	 	726	 	 	596	 	 		 
		 		
		
		
		
		 	
	Total Payments All Accounts	 	 	 	 	 	 	34	 	 	127	 	 	146	 	 	75	 	348	 
		 		
		
		
		
		
	
	Ending Balance All Accounts	 	 	 	 	 	 	1,043	 	 	916	 	 	770	 	 	695	 	 		 
		 		
		
		
		
		 	






	



*  Not Committed at This Time

**  Greenbridge Payable