fiscal
quarters of EBITDA losses (exclusive of the quarters ending June 30, 2005,
March 31, 2006, and June 30, 2006) and (ii) Borrower shall maintain EBITDA, for
each fiscal period set forth below, of not less than the amount indicated below
opposite such fiscal period:
for the immediately preceding twelve-month period ending 06/30/06
$
3,500,000
for the immediately preceding twelve-month period ending 09/30/06
$
3,750,000
for the immediately preceding twelve-month period ending 12/31/06
$
4,250,000
for the immediately preceding twelve-month period ending 03/31/07
$
4,250,000
for the immediately preceding twelve-month period ending 06/30/07 and for each
twelve-month period ending at each fiscal quarter end thereafter
$
5,000,000
3.
CONSENTS. LENDER HEREBY CONSENTS TO (A) BORROWER'S ENTERING INTO THAT
CERTAIN REPLICATION AGREEMENT, WITH SONOPRESS LLC, A DELAWARE LIMITED LIABILITY
COMPANY (THE "SONOPRESS REPLICATION AGREEMENT"), IN FORM AND SUBSTANCE
SATISFACTORY TO AGENT IN ITS SOLE DISCRETION (IT BEING UNDERSTOOD BETWEEN THE
PARTIES THAT THE FORM OF AGREEMENT ATTACHED HERETO AS EXHIBIT B IS SATISFACTORY
TO AGENT), AND (B) NOTWITHSTANDING ANYTHING TO THE CONTRARY IN SECTION 7.2 OF
THE LOAN AGREEMENT, BORROWER'S INCURRENCE OF A LIEN IN CONNECTION WITH THE
SONOPRESS REPLICATION AGREEMENT SO LONG AS SUCH LIEN IS (I) EXPRESSLY JUNIOR AND
SUBORDINATE TO LENDER'S LIEN IN BORROWER COLLATERAL AND (II) SUBJECT TO A
SUBORDINATION AGREEMENT SATISFACTORY TO LENDER IN ITS SOLE DISCRETION.
4.
WAIVER. LENDER HEREBY WAIVES THE EVENT OF DEFAULT THAT HAS OCCURRED AS A
RESULT OF THE FAILURE BY BORROWER TO COMPLY WITH SECTION 6.12(A) OF THE LOAN
AGREEMENT WITH RESPECT TO THE FISCAL PERIOD ENDING MARCH 31, 2006.
2
5.
CONDITIONS PRECEDENT TO AMENDMENT. THE SATISFACTION OF EACH OF THE
FOLLOWING SHALL CONSTITUTE CONDITIONS PRECEDENT TO THE EFFECTIVENESS OF THIS
AMENDMENT AND EACH AND EVERY PROVISION HEREOF:
(A)
LENDER SHALL HAVE RECEIVED THIS AMENDMENT, DULY EXECUTED BY THE
PARTIES HERETO, AND THE SAME SHALL BE IN FULL FORCE AND EFFECT.
(B)
LENDER SHALL HAVE RECEIVED A REAFFIRMATION AND CONSENT
SUBSTANTIALLY IN THE FORM ATTACHED HERETO AS EXHIBIT A, DULY EXECUTED AND
DELIVERED BY EACH GUARANTOR.
(C)
LENDER SHALL HAVE RECEIVED AN AMENDMENT FEE IN THE AMOUNT OF
$20,000, WHICH AMOUNT BORROWER AUTHORIZES LENDER TO CHARGE TO THE LOAN ACCOUNT.
(D)
THE REPRESENTATIONS AND WARRANTIES HEREIN AND IN THE LOAN
AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRUE AND CORRECT IN ALL MATERIAL
RESPECTS ON AND AS OF THE DATE HEREOF, AS THOUGH MADE ON SUCH DATE (EXCEPT TO
THE EXTENT THAT SUCH REPRESENTATIONS AND WARRANTIES RELATE SOLELY TO AN EARLIER
DATE).
(E)
NO DEFAULT OR EVENT OF DEFAULT SHALL HAVE OCCURRED AND BE
CONTINUING ON THE DATE HEREOF, NOR SHALL RESULT FROM THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREIN.
(F)
NO INJUNCTION, WRIT, RESTRAINING ORDER, OR OTHER ORDER OF ANY
NATURE PROHIBITING, DIRECTLY OR INDIRECTLY, THE CONSUMMATION OF THE TRANSACTIONS
CONTEMPLATED HEREIN SHALL HAVE BEEN ISSUED AND REMAIN IN FORCE BY ANY
GOVERNMENTAL AUTHORITY AGAINST BORROWER, ANY GUARANTOR, OR LENDER.
6.
RELEASE. BORROWER HEREBY WAIVES, RELEASES, REMISES AND FOREVER DISCHARGES
LENDER, EACH OF ITS AFFILIATES, AND