behalf were similarly authorized and
empowered, and that this Amendment does not contravene any provisions of its
certificate of incorporation or formation, operating agreement, bylaws, or other
formation documents, as applicable, or of any contract or agreement to which
they are party or by which any of their properties are bound; and
(e)
represent and warrant that this Amendment is a legal, valid and
binding obligations of Sellers enforceable against them in accordance with its
terms.
4.
CONDITIONS PRECEDENT/EFFECTIVENESS CONDITIONS.
THIS
AMENDMENT SHALL BE EFFECTIVE ("EFFECTIVE DATE") UPON FGI'S RECEIPT OF THE
FOLLOWING:
(A)
THIS AMENDMENT FULLY EXECUTED BY SELLERS; AND
(B)
A NON-REFUNDABLE AMENDMENT FEE IN THE AMOUNT OF $75,000.
5.
PAYMENT OF EXPENSES.
PURSUANT TO SECTION 14 OF THE SALE
AGREEMENTS, SELLERS SHALL UPON DEMAND OF FGI ALL COSTS, FEES AND EXPENSES OF FGI
IN CONNECTION WITH THE PREPARATION, NEGOTIATION AND EXECUTION OF THIS AMENDMENT
(INCLUDING REASONABLE FEES, EXPENSES AND DISBURSEMENTS OF COUNSEL FOR FGI) AND
THE DOCUMENTS AND TRANSACTIONS PROVIDED FOR HEREIN OR RELATED HERETO.
6.
REAFFIRMATION OF SALE AGREEMENTS.
EXCEPT AS MODIFIED BY THE
TERMS HEREOF, ALL OF THE TERMS AND CONDITIONS OF THE SALE AGREEMENTS, AS
AMENDED, AND ALL OF THE OTHER DOCUMENTS ARE HEREBY REAFFIRMED AND SHALL CONTINUE
IN FULL FORCE AND EFFECT AS THEREIN WRITTEN.
7.
REAFFIRMATION OF COLLATERAL.
AS SECURITY FOR THE PAYMENT OF
ALL INDEBTEDNESS AND OBLIGATIONS OF SELLERS TO FGI, IN ADDITION TO THE SALE OF
PURCHASE ACCOUNTS, EACH SELLER RECONFIRMS THE PRIOR SECURITY INTEREST AND LIEN
ON, UPON AND TO, ITS COLLATERAL, WHETHER NOW OWNED OR HEREAFTER ACQUIRED,
CREATED OR ARISING AND WHEREVER LOCATED.
EACH SELLER HEREBY CONFIRMS AND AGREES
THAT ALL SECURITY INTERESTS AND LIENS GRANTED TO FGI CONTINUE IN FULL FORCE AND
EFFECT AND SHALL CONTINUE TO SECURE THE OBLIGATIONS.
ALL COLLATERAL REMAINS
FREE AND CLEAR OF ANY LIENS AND SECURITY INTERESTS, EXCEPT AS PROVIDED IN THAT
CERTAIN SUBORDINATION AGREEMENT DATED FEBRUARY 11, 2011 AMONG FGI, KANIS, S.A.
AND CLEAN DIESEL TECHNOLOGIES, INC., AS AMENDED FROM TIME TO TIME.
5
8.
CONFIRMATION OF INDEBTEDNESS.
SELLERS CONFIRMS AND
ACKNOWLEDGES THAT AS OF THE CLOSE OF BUSINESS ON AUGUST 15, 2012, THE
OUTSTANDING AGGREGATE OBLIGATIONS OWING BY SELLERS TO FGI UNDER THE SALE
AGREEMENTS, ALL WITHOUT ANY DEDUCTION, DEFENSE, SETOFF, CLAIM OR COUNTERCLAIM,
OF ANY NATURE, IS IN THE AGGREGATE PRINCIPAL AMOUNT OF $3,874,165.24 PLUS ALL
FEES, COSTS AND EXPENSES INCURRED TO DATE IN CONNECTION WITH THE SALE AGREEMENTS
AND THE OTHER DOCUMENTS.
9.
ACKNOWLEDGMENT OF GUARANTORS.
(A)
BY EXECUTION OF THIS AMENDMENT, EACH OF CDT, ECS LTD., CDI, CSI,
ECS EUROPE, CDT LIMITED, ECS HOLDINGS, CS HOLDINGS AND ALISO HEREBY COVENANTS
AND AGREES THAT THE GUARANTEE SHALL REMAIN IN FULL FORCE AND EFFECT IN ALL
RESPECTS AND SHALL, INTER ALIA, CONTINUE TO COVER ALL EXISTING AND FUTURE
OBLIGATIONS OF ECS LIMITED TO FGI, INCLUDING, WITHOUT LIMITATION, UNDER THAT
CERTAIN SALE OF ACCOUNTS AND SECURITY AGREEMENT DATED AS OF FEBRUARY 14, 2011,
AND THE OTHER DOCUMENTS (AS DEFINED THEREIN).
(B)
BY EXECUTION OF THIS AMENDMENT, EACH OF CDT,