Document:

THIRD AMENDMENT TO MEDIA AND MARKETING SERVICES AGREEMENT

This THIRD AMENDMENT TO MEDIA AND MARKETING SERVICES AGREEMENT (this “Third Amendment”) is entered into on the 22nd day of October, 2010 and made effective as of the 15th day of October, 2010, by and between CyberDefender Corporation, a Delaware corporation (“CyberDefender”), and GR Match, LLC, a Delaware limited liability company (“GRM”).  GRM and CyberDefender may each be referred to herein as a “Party” and, collectively, as the “Parties.”

RECITALS

WHEREAS, GRM and CyberDefender Corporation, a California corporation (as predecessor in interest to CyberDefender), entered into that certain Media and Marketing Services Agreement, dated as of March 24, 2009, to be effective as of March 1, 2009, as amended by that certain First Amendment thereto, dated as of June 4, 2009, and that certain Second Amendment thereto, dated as of October 26, 2009 (collectively, the “Agreement”); and

WHEREAS, the Parties desire to amend the Agreement as set forth herein.

NOW THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agrees as follows:

1.            Addition of Section 1.6 to the Agreement.  The following provision shall be added to the Agreement as Section 1.6:

1.6           Board of Directors Observer.  At any time when there is no GRM Director on the Board of Directors of CyberDefender as provided in Section 1.5, so long as GRM owns Common Stock, or holds warrants which grant GRM the right to purchase Common Stock of CyberDefender (whether vested or unvested), which collectively constitute at least five percent (5%) of CyberDefender’s issued and outstanding Common Stock on a fully diluted basis, GRM shall have the right to appoint one (1) Board of Directors observer (the “Observer”) upon written notice to CyberDefender, which Observer shall be selected in GRM's sole discretion.  GRM may change the Observer for any reason at any time upon written notice to CyberDefender.  CyberDefender shall invite the Observer to attend all meetings of its Board of Directors in a nonvoting observer capacity and, in this respect, shall give the Observer copies of all notices, minutes, consents and other materials that CyberDefender provides to its directors at the same time and in the same manner as provided to such directors; provided, however, that the Observer shall agree to hold in confidence and trust all information so provided and provided further that CyberDefender reserves the right to withhold any information and to exclude the Observer from any meeting or portion thereof if access to such information or attendance at such meeting could adversely affect the attorney-client privilege between CyberDefender and its counsel.

  

  

  

 

2.            Amendment to Section 2.3 of the Agreement.  The first sentence of Section 2.3 of the Agreement is hereby amended and restated in its entirety as follows:

“As security for CyberDefender's prompt payment of any amounts owing to GRM under Sections 2.2, 2.4 or 2.5 (the “Payment Obligations”), CyberDefender has granted to GRM a security interest and lien in any proceeds held in the Merchant Service Account, including, without limitation, any settlement accounts and/or reserve accounts held in connection therewith, and any rights to receive credits or payments under any merchant services agreement or other similar agreement relating to the Merchant Services Account.”

3.            Addition of Sections 2.4 and 2.5 to the Agreement.  The following provisions shall be added to the Agreement as Sections 2.4 and 2.5, respectively:

2.4           Creative Management Fee.  In addition to CyberDefender's payment of any other amounts due hereunder, commencing as of October 15, 2010, CyberDefender shall pay to GRM a monthly management fee equal to Seventy Five Thousand Dollars ($75,000), payable monthly in advance, not later than the first (1st) day of each month during the Term; provided, however, that the amount of such monthly management fee in respect of any month (or portion thereof) in which media buying has been paused or suspended pursuant to Section 1.1(i) shall be decreased on a pro rata basis based on the number of days that media buying has been paused or suspended during such month.

2.5           Payment of Production Costs.  CyberDefender shall either directly pay for, or reimburse GRM, at GRM's option, for the payment of, all out-of-pocket costs incurred by GRM in connection with the creation, development, and/or production of any Commercials in connection with GRM's performance of the GRM Services (collectively, “Production Costs”).  With respect to Production Costs paid by GRM on behalf of CyberDefender, GRM shall deliver to CyberDefender copies of monthly invoices which set forth in reasonable detail the amount of all such Production Costs incurred by GRM on CyberDefender's behalf during the applicable month.  CyberDefender shall pay the amount of all such Production Costs incurred by GRM on CyberDefender's behalf not later than fifteen (15) days after its receipt of the applicable invoice.

The Parties acknowledge and agree that the payment of the creative management fee contemplated in Section 2.4 of the Agreement that was otherwise due on October 15, 2010 pursuant to the amendment above shall instead be payable not later than three (3) business days following the execution of this Third Amendment.

  

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4.           Amendment to Section 5.1 of the Agreement.  Section 5.1 of the Agreement is hereby amended and restated in its entirety as follows:

5.1           Term.  Subject to any termination rights set forth herein, the term (the “Term”) of this Agreement shall commence upon the Effective Date and continue until October 31, 2011 unless earlier terminated in accordance with the provisions of this Agreement (the “Termination Date”).

5.           Conflict; Full Force and Effect.  In the event of any conflict between this Third Amendment and the Agreement, this Third Amendment shall control.  The Parties acknowledge and agree that, except as expressly provided herein, the provisions of the Agreement shall remain unmodified and in full force and effect.

 

6.            Successors and Assigns.  This Third Amendment is and shall be binding upon each of the Parties and their respective successors and assigns.

 

7.            Recitals.  The recitals to this Third Amendment are hereby incorporated by reference herein.

 

8.            Governing Law.  This Third Amendment shall be governed by the laws of the State of California, without regard to its principles of conflict of laws.

 

9.            Entire Agreement.  This Third Amendment and the Agreement contain the complete understanding and agreement of the Parties relating to the subject matter hereof and thereof and supersede any prior understanding or agreement related thereto, whether written or oral.

 

10.          Counterparts.  This Third Amendment may be executed in multiple counterparts, each of which will be deemed an original, but together they will constitute one and the same instrument.

 

[signatures on following page]

 

  

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IN WITNESS WHEREOF, this Third Amendment has been duly executed by the Parties as of the date first above written.

	  	
GR Match, LLC,

	  	
a Delaware limited liability company

	  	  
	  	
By:

	  
	 	 	 
Name: Kevin Knee

	 	 	 
Title: Manager

	  	
 

	  	
CyberDefender Corporation,

	  	
a Delaware corporation

	  	  
	  	
By:

	  
	 	 	 
Name: Gary Guseinov

	 	 	 
Title: Chief Executive OfficerFIRST AMENDMENT TO LICENSE AGREEMENT

This FIRST AMENDMENT TO LICENSE AGREEMENT (this “First Amendment”) is entered into on the 22nd day of October, 2010, and made effective as of the 15th day of October, 2010 (the “Effective Date”), by and between CyberDefender Corporation, a Delaware corporation (“CyberDefender”), and GR Match, LLC, a Delaware limited liability company (“GRM”).  GRM and CyberDefender may each be referred to herein as a “Party” and, collectively, as the “Parties.”

RECITALS

WHEREAS, GRM and CyberDefender Corporation, a California corporation (as predecessor in interest to CyberDefender), entered into that certain License Agreement, dated as of April 1, 2010 (the “Agreement”);

WHEREAS, the Parties desire to amend the Agreement as set forth herein; and

WHEREAS, capitalized terms used but not defined herein shall have the meanings ascribed to them in the Agreement.

NOW THEREFORE, in consideration of the foregoing premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agrees as follows:

1.           Amendment to Schedule D to the Agreement.  Attached hereto and made a part hereof is an amended Schedule D to the Agreement which amended Schedule D replaces in its entirety the Schedule D to the Agreement in effect immediately prior to the Effective Date and is hereby made a part of the Agreement as of the Effective Date.

2.           Agreement Regarding International Roll-Out Date.

(a)           CyberDefender acknowledges that GRM has notified CyberDefender in writing that GRM has selected Australia, Canada and the United Kingdom as the initial three (3) countries in which GRM proposes to sell and/or distribute the Products in the International Territory (collectively, the “Selected Countries”) as specified in the definition of the International Roll-Out Date.

(b)           CyberDefender acknowledges that it has not completed all actions required under Section 4.3(a) of the Agreement in order to facilitate the sale and use of the Products in the Selected Countries.  CyberDefender agrees to notify GRM in writing when CyberDefender reasonably believes that it has completed all actions required under Section 4.3(a) of the Agreement in order to facilitate the sale and use of the Products in the Selected Countries.

  

  

  

 

(c)           CyberDefender agrees that GRM shall have the one (1) time right to cause the eighteen month (18) month cutoff date referenced in the definition of the International Roll-Out Date to be delayed for a period of up to twelve (12) months in the event GRM elects to delay its Marketing of the Products in the International Territory for legitimate business reasons, including, without limitation, delays in the development of those processes, systems or other similar aspects of GRM’s business necessary to support GRM’s Marketing of the Products in the International Territory.

3.            Conflict; Full Force and Effect.  In the event of any conflict between this First Amendment and the Agreement, this First Amendment shall control.  The Parties acknowledge and agree that, except as expressly provided in this First Amendment, the provisions of the Agreement shall remain unmodified and in full force and effect.

 

4.            Successors and Assigns.  This First Amendment is and shall be binding upon each of the Parties and their respective successors and assigns.

 

5.            Recitals.  The recitals to this First Amendment are hereby incorporated by reference herein.

 

6.            Governing Law.  This First Amendment shall be governed by the laws of the State of California, without regard to its principles of conflict of laws.

 

7.            Entire Agreement.  This First Amendment and the Agreement contain the complete understanding and agreement of the Parties relating to the subject matter hereof and thereof and supersede any prior understanding or agreement related thereto, whether written or oral.

 

8.            Counterparts.  This First Amendment may be executed in multiple counterparts, each of which will be deemed an original, but together they will constitute one and the same instrument.

 

[Signatures on following page]

  

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IN WITNESS WHEREOF, this First Amendment has been duly executed by the Parties as of the date first above written.

	  	
GR Match, LLC,

	  	
a Delaware limited liability company

	  	  
	  	
By:

	  
	  	  	
Name: Kevin Knee

	  	  	
Title: Manager

	  	  	  
	  	
CyberDefender Corporation,

	  	
a Delaware corporation

	  	  
	  	
By:

	  
	  	  	
Name: Gary Guseinov

	  	  	
Title: Chief Executive Officer

  

  

  

Schedule D

Products; Royalty

	
Territory in

Which

Product is

Sold

	 	
Product

	  	
Amount of

Royalty 

(per annual

subscription)

	 
	
Any jurisdiction within the Domestic Territory or the International Territory

	 	
CyberDefender Early Detection Center

Ø     Antispyware and Antivirus PC software with unlimited software and threat updates for 1 year.  Tier 1 and Tier 2 technical support included.

Ø    All software updates included

	  	
$

	
2.50

	 
	  	 	
CyberDefender Early Detection Center Family Pak

Ø     Antispyware and Antivirus PC software with unlimited software and threat updates for 1 year.  Tier 1 and Tier 2 technical support included.

Ø    All software updates included.

Ø    Software bundle includes 5 licenses which can protect up to 5 PCs

	  	
$

	
3.00

	 
	  	 	
CyberDefender Registry Cleaner

Ø    Analyzes and fixes broken PC registries and performs other PC optimization tasks.

Ø    Unlimited updates for 1 year.

	  	
$

	
2.50

	 

 

  

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