Document:

bosm_ex101.htm

EXHIBIT 10.1

 

 

 

  

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7AMENDMENT NO. 1 TO LOAN AGREEMENT

 

THIS AMENDMENT NO. 1 TO LOAN AGREEMENT (this "Amendment"),
dated as of May 18, 2012, by and among WEBXU, INC., a Delaware corporation (“Webxu”), each of the following
direct or indirect subsidiaries of Webxu (individually, a "Subsidiary" and collectively, the "Subsidiaries"):
(i) Bonus Interactive Inc., a Delaware corporation and wholly-owned subsidiary of Webxu formerly known as Secureaquote, Inc. ("Bonus
Interactive"), (ii) Webxu Media, Inc., a Delaware corporation and wholly-owned subsidiary of Webxu formerly known as Lot6
Media, Inc. which resulted from the conversion of Lot6 Holding, LLC, a Delaware limited liability company, into a corporation ("Webxu
Media"), and (iii) Lot6 Media, LLC, a California limited liability company and wholly-owned subsidiary of Webxu Media
("Lot6 LLC"), and BREAKWATER STRUCTURED GROWTH OPPORTUNITIES FUND L.P., a Delaware limited partnership (the "Lender").
Webxu and the Subsidiaries are sometimes collectively referred to herein as “Borrowers” and, individually, as
a “Borrower.”

 

RECITALS

 

A.       Borrowers
and Lender have previously entered into a Loan Agreement, dated as of March 1, 2012 (the "Original Loan
Agreement"), pursuant to which (i) Lender made an initial loan in the face amount of $1,200,000 (subject to original
issue discount) (the "First Term Loan") which loan is evidenced by a Senior Secured Promissory Note in favor
of Lender, dated March 1, 2012, in the face amount of $1,200,000 (the "First Note"), and (ii) Lender agreed
to make an additional loan in the face amount of $1,200,000 (subject to original issue discount) upon request of Borrowers
and subject to satisfaction of certain conditions (the "Second Term Loan"). Capitalized terms used in this
Amendment and not otherwise defined shall have the meaning ascribed to them in the Original Loan Agreement.

 

B.       Borrowers and
Lender wish to amend certain provisions of the Original Loan Agreement in order to, among other things, (i) increase the amount
of the Second Term Loan to $1,800,000 (subject to original issue discount of $300,000), (ii) modify the payment terms of the Second
Note to provide for full amortization over a six month period, and (iii) provide for the issuance to Lender of a Warrant to purchase
1,000,000 shares of Webxu Common Stock (the "New Warrant") in lieu of the Second Warrant.

 

NOW, THEREFORE, for valuable consideration,
the amount and sufficiency which is hereby acknowledged, the parties agree as follows:

 

agreement

 

      1.      Recitals.
The Recitals are true and correct and are incorporated herein by reference.

 

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

    	 

    	 

    

 

 

       2.      Second Term Loan and Second Note. Notwithstanding anything to the contrary
contained in the Original Loan Agreement, (i) the aggregate loans that may be made under the Original Loan Agreement shall be
increased from $2,400,000 to $3,000,000, (ii) the amount of the Second Term Loan shall be increased from $1,200,000 to
$1,800,000 (subject to original issue discount), (iii) the face amount of the Second Note will be $1,800,000 while the Second
Funded Amount shall be increased from $1,000,000 to $1,500,000 (exclusive of fees and charges payable by Borrowers at the
Closing of the Second Term Loan), and (iv) the Second Note shall be in substantially the same form as Exhibit A
attached hereto. All references in the Loan Agreement to the Second Term Loan and the Second Note shall be deemed to refer to
the Second Term Loan and Second Note after giving effect to the modifications contemplated by this Amendment.

 

        3.      Lender
Fees and Expenses, On the date of the funding of the Second Term Loan, the origination fee payable by Borrowers to Lender
shall be $36,000 (2% of the face amount of the Second Note). In addition, Borrowers shall pay to Lender (by deduction from the
Second Funded Amount), Lender's legal and other expenses incurred in connection with the documentation and closing of the Second
Term Loan in an amount not to exceed $8,000.

 

        4.      Warrants.
In lieu of the Second Warrant contemplated by the Original Loan Agreement, simultaneously with the closing of the Second Term
Loan, Webxu shall issue to Lender the New Warrant in substantially the same form as Exhibit B attached hereto. References
in the Original Loan Agreement to the "Warrants" shall be deemed to refer collectively to the First Warrant and the
New Warrant. Borrowers acknowledge and agree that, notwithstanding anything to the contrary contained in the First Warrant, the
issuance of the New Warrant shall not trigger any anti-dilution adjustment under the terms of the First Warrant.

 

        5.      Amended
Definition of "Security Agreement". References to "Security Agreement" in the Original Loan Agreement
shall be deemed to refer to the Original Security Agreement as amended by the First Amendment to Security Agreement dated on or
about the date of this Amendment.

 

        6.      Full
Force and Effect. Except as specifically set forth in this Amendment, all of the terms of the Notes and the Original Loan
Agreement remain unchanged and in full force and effect.

 

        7.      Governing Law. The
laws of the State of California shall govern the construction and interpretation of this Amendment.

 

[Signatures follow on following
page]

 

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

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IN WITNESS WHEREOF, the parties executed this
Amendment and made it effective as of the day and year set forth above.

 

BORROWERS:

 

WEBXU, Inc., a Delaware
corporation

 

	By:	/J. Aaronson/	 
	 	Name:  Jeffrey Aaronson	 
	 	Title:  CFO	 

 

BONUS INTERACTIVE INC.,
a Delaware corporation

 

	By:	/J. Aaronson/	 
	 	Name:  Jeffrey Aaronson	 
	 	Title:  CFO	 

 

WEBXU MEDIA, INC., a Delaware corporation

 

	By:	/J. Aaronson/	 
	 	Name:  Jeffrey Aaronson	 
	 	Title:  CFO	 

 

LOT6 MEDIA, LLC, a California limited liability company

 

	By:	/J. Aaronson/	 
	 	Name:  Jeffrey Aaronson	 
	 	Title:  CFO	 

 

LENDER:

 

BREAKWATER STRUCTURED GROWTH

OPPORTUNITIES FUND, L.P.

 

By:  Breakwater Investment Management, LLC, its General Partner

 

	 	By:	/S. Mansour/	 
	 	 	Saif Mansour, Managing Partner

 

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

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EXHIBIT A

 

Form of Second Note

 

See attached form of Second Note

 

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

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EXHIBIT B

 

New Warrant

 

See attached form of New Warrant

 

AMENDMENT NO. 1 TO LOAN AGREEMENT

 

    	5Exhibit 10.2

 

SENIOR SECURED PROMISSORY NOTE

 

	$1,800,000.00  	Los Angeles, California	May 18, 2012

 

FOR VALUE RECEIVED, on or before the applicable Maturity Date (as
defined below) or such earlier dates as may be required by the terms hereof, WEBXU, INC., a Delaware corporation (“Webxu”),
each of the following direct or indirect subsidiaries of Webxu (collectively, the "Subsidiaries"): (i) Bonus Interactive
Inc., a Delaware corporation and wholly-owned subsidiary of Webxu formerly known as Secureaquote, Inc., (ii) Webxu Media, Inc.,
a Delaware corporation and wholly-owned subsidiary of Webxu formerly known as Lot6 Media, Inc. which resulted from the conversion
of Lot6 Holding, LLC, a Delaware limited liability company, into a corporation ("Webxu Media"), and (iii) Lot6 Media,
LLC, a California limited liability company and wholly-owned subsidiary of Webxu Media, each jointly and severally promises to
pay to BREAKWATER STRUCTURED GROWTH OPPORTUNITIES FUND, L.P., a Delaware limited
partnership ("Lender"), or to its order, at its office located at 2049 Century Park East, Suite 2710, Los Angeles, CA
90067, or at such other place as the holder hereof may designate, in lawful money of the United State of America, in cash or immediately
available funds acceptable to the holder hereof, the principal sum of ONE MILLION EIGHT HUNDRED THOUSAND DOLLARS ($1,800,000.00),
together with interest on the outstanding principal balance until paid in full in accordance with the terms, conditions and provisions
hereinafter set forth in this Senior Secured Promissory Note (this "Note") and in the Loan Agreement (as defined below).
Webxu and the Subsidiaries are sometimes collectively referred to herein as “Borrowers” and individually as a “Borrower.”

 

1.         ORIGINAL ISSUE
DISCOUNT; FUNDING.

 

(a)        OID.
Each Borrower understands and agrees that Lender is acquiring this Note subject to an original issue discount of $300,000 (the
"OID"). As a result, notwithstanding anything to the contrary contained in this Note or the Loan Agreement, the face
amount of this Note exceeds the amount actually funded (the “Funded Amount”) by the amount of the OID.

 

(b)        Funding.
Each Borrower acknowledges and agrees that (i) the Funded Amount will be funded directly to Webxu, as funding agent for each of
the Borrowers, (ii) from and after the date of this Agreement, Webxu may, in its sole and absolute discretion, allocate or distribute
a portion of the Funded Amount to one or more of the Borrowers to fund such Borrower’s working capital requirements or, to
the extent permitted by the Loan Agreement (and any related subordination documents), repay certain debt, and (iii) in light of
the business relationships among the Borrowers, each Borrower is accepting joint and several liability under this Note and under
the Loan Agreement in consideration of the financial accommodations to be provided by Lender under this Note and the Loan Agreement,
which Borrowers hereby agree are for the mutual benefit, directly and indirectly, of each Borrower and in consideration of the
undertakings of the other Borrowers to accept joint and several liability hereunder.

 

    	 

    	 

    

 

2.         SECURITY
AGREEMENT. This Note is executed and delivered by Borrowers pursuant to the terms of that certain Loan Agreement, by and among
Lenders and Borrowers, and related Pledge and General Security Agreement, both dated as of March 1, 2012 (each as amended, respectively,
by Amendment No. 1 to Loan Agreement and the First Amendment to Pledge and Genera Security Agreement, each of even date herewith,
collectively, the “Loan Agreement”). This Note represents the Second Term Loan (as defined in the Loan Agreement) (less
OID) pursuant to the terms of the Loan Agreement. An Initial Term Loan (as defined in the Loan Agreement) was made pursuant to
a separate Senior Secured Promissory Note (the "Initial Note"). Each Borrower has granted Lender a security interest
in certain of its assets in order to secure payment of its obligations under this Note, the Initial Note and the Loan Agreement.

3.        INTEREST
RATE. Interest shall accrue on the unpaid principal balance of this Note, and shall be due and payable to Lender, at the rate
of twelve percent (12.0%) per annum (“Note Rate”). Interest shall be calculated based upon a 360-day year and actual
days elapsed.

4.         PRINCIPAL
AND INTEREST PAYMENTS. Principal and interest on this Note shall be repaid by Borrowers in six (6) equal monthly installments
of Three Hundred Ten Thousand Five Hundred Eighty-Seven and 06/100 Dollars ($310, 587.06). Installments shall be due on the first
month anniversary of the date of this Note and on each monthly anniversary thereafter. All accrued but unpaid interest under this
Note shall be due and payable on the Maturity Date, or earlier upon acceleration of the maturity of this Note or upon prepayment
of the principal amount of this Note in full. If all indebtedness under this Note is not paid in full by the Maturity Date, interest
on the unpaid principal balance of this Note (and all accrued unpaid interest thereon) shall accrue and be due, without notice
or demand, at the Default Rate (as hereinafter defined). All payments due hereunder, including payments of principal or interest,
shall be made to the holder of this Note in United States Dollars and shall be in the form of immediately available funds acceptable
to the holder of this Note. Lender may, at its sole option, set off any and all indebtedness owing from time to time by Lender
to any Borrower against amounts that are then due and owing under this Note.

5.        MATURITY
DATE. The "Maturity Date" shall be six (6) months following the date of this Note. On the Maturity Date the entire
unpaid principal balance of the Note, and all unpaid accrued interest thereon, shall be due and payable without demand or notice.

6.        APPLICATION
OF PAYMENTS. All payments received by Lender from or for the account of Borrowers hereunder shall be applied by Lender in the
following manner or, upon the occurrence of a Default (as hereinafter defined) in any other order or manner Lender chooses: (i)
first, to pay any and all costs, advances, expenses or fees due, owing or payable to Lender, or paid or incurred by Lender, arising
from or out of this Note and the Loan and Security Agreement, (ii) second, to pay any accrued unpaid interest due hereunder, and
(iii) third, to pay any principal amount then owing under this Note. All records of payments received by Lender shall be maintained
at Lender's office, and the records of Lender shall, absent manifest error, be binding and conclusive upon Borrowers. The failure
of Lender to record any payment or expenses shall not limit or otherwise affect the obligations of Borrowers under this Note.

7.        UNPAID
INTEREST AND COSTS. Interest, late charges, costs, or expenses that are not received by Lender when such interest, late charges,
costs, or expenses become due, shall, at the sole discretion of Lender, be added to the principal balance and shall from the date
due bear interest at the Default Rate (as hereinafter defined). 

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8.         NO
OFFSETS OR DEDUCTIONS. All payments under the Note shall be made by Borrowers without any offset, decrease, reduction or deduction
of any kind or nature whatsoever.

9.        DEFAULT.
Any one or more of the following events or occurrences shall constitute a default under this Note (hereinafter "Default"):

 

	(1)		Lender does not receive a payment in the amount and within the time and manner as
set forth herein; or

 

	(2)		An "Event of Default" or "Default" occurs as described and defined
in any of the Loan Agreement; or

 

	(3)		Any Borrower commits a default as specified in any other obligation of such Borrower
owing to Lender (including, without limitation, the Initial Note).

 

Upon the occurrence of a Default, Lender
may, in its sole and absolute discretion, declare the entire unpaid principal balance, together with all accrued and unpaid interest
thereon, and all other amounts or payments due hereunder, immediately due and payable, without notice or demand.

10.         DEFAULT
RATE. From and after the occurrence of any Default in this Note, whether by nonpayment, maturity, acceleration, nonperformance
or otherwise, and until such Default has been cured, all outstanding amounts under this Note (including, but not limited to, interest,
costs and late charges) shall bear interest at a per annum rate (the "Default Rate") equal to eight percentage points
(8.0%) over the Note Rate.

 

11.        LATE
CHARGES. Time is of the essence for all payments and other obligations due under this Note. Each Borrower acknowledges that
if any installment payment required under this Note is not received by Lender within five (5) days after the same becomes due,
Lender will incur extra administrative expenses (i.e., in addition to expenses incident to receipt of timely payment) and the loss
of the use of funds in connection with the delinquency in payment. Because the actual damages suffered by Lender by reason of such
administrative expenses and loss of use of funds would be impracticable or extremely difficult to ascertain, each Borrower agrees
that five percent (5%) of the amount of the delinquent installment payment, together with interest accruing on the entire unpaid
principal balance of this Note at the Default Rate, as provided above, shall be the amount of damages which Lender is entitled
to receive upon such breach, in compensation therefor. Borrowers shall, in such event, without further demand or notice, pay to
Lender, as Lender's monetary recovery for such extra administrative expenses and loss of use of funds, liquidated damages in the
amount of five percent (5%) of the amount of the delinquent payment (in addition to interest at the Default Rate). The provisions
of this paragraph are intended to govern only the determination of damages in the event of a breach in the performance of Borrowers
to make timely payments hereunder. Nothing in this Note shall be construed as in any way giving Borrowers the right, express or
implied, to fail to make timely payments hereunder, whether upon payment of such damages or otherwise. The right of Lender to receive
payment of such liquidated and actual damages, and receipt thereof, are without prejudice to the right of Lender to collect such
delinquent payments and any other amounts provided to be paid hereunder or under the Loan Agreement, or to declare a default hereunder
or under the Loan Agreement.

 

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12.        PREPAYMENT
OF PRINCIPAL; INTEREST. Borrowers may prepay all or any portion of the principal amount of this Note. Concurrently with any
prepayment of the unpaid principal balance of this Note, Borrowers shall pay to lender all accrued unpaid interest under this Note.

 

13.        COSTS
AND EXPENSES. Borrowers hereby jointly and severally agree to pay any and all costs and expenses paid or incurred by Lender
by reason of, as a result of, or in connection with, this Note or the Loan Agreement, including, but not limited to, attorneys'
fees and related costs whether such costs or expenses are paid or incurred in connection with the enforcement of this Note or the
Loan Agreement, the protection or preservation of the collateral or security for this Note or any other rights, remedies or interests
of Lender, whether or not suit is filed. Each Borrower’s agreement to pay any and all such costs and expenses includes, but
is not limited to, costs and expenses incurred in enforcing any judgment obtained by Lender and in connection with any and all
appeals therefrom. All such costs and expenses are immediately due and payable to Lender by Borrowers, whether or not demand therefor
is made by Lender.

 

14.        WAIVERS.
Each Borrower hereby waives grace, diligence, presentment, demand, notice of demand, dishonor, notice of dishonor, protest, notice
of protest, any and all exemption rights against the indebtedness evidenced by this Note and the right to plead any statute of
limitations as a defense to the repayment of all or any portion of this Note, and interest thereon, to the fullest extent allowed
by law, and all compensation of cross-demands pursuant to California Code of Civil Procedure section 431.70. No delay, omission
or failure on the part of Lender in exercising any right or remedy hereunder shall operate as a waiver of such right or remedy
or of any other right or remedy of Lender.

 

15.        MAXIMUM
LEGAL RATE. The parties to this Note intend and agree that the indebtedness evidenced by this Note and the Loan Agreement is
and shall remain exempt from the usury provisions of the California Constitution, including, without limitation, by virtue of the
provisions of California Corporations Code Section 25118(b). This Note and the Loan Agreement are subject to the express condition
that at no time shall any Borrower be obligated, or required, to pay interest on the principal balance at a rate which could subject
Lender to either civil or criminal liability as a result of such rate being in excess of the maximum rate which Lender is permitted
to charge. If, by the terms of this Note, Borrowers are, at any time, required or obligated to pay interest on the principal balance
at a rate in excess of such maximum rate, then the rate of interest under this Note shall be deemed to be immediately reduced to
such maximum rate, and interest payable hereunder shall be computed at such maximum rate, and any portion of all prior Interest
payments in excess of such maximum rate shall be applied, and/or shall retroactively be deemed to have been payments made, in reduction
of the principal balance.

 

16.         AMENDMENT.
This Note may be amended, changed, modified, terminated or canceled only by a written agreement signed by the party against whom
enforcement is sought for any such action.

 

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17.        GOVERNING
LAW AND JURISDICTION. IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS NOTE AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA APPLICABLE
TO CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES THEREOF REGARDING CONFLICTS OF LAWS, AND ANY APPLICABLE
LAWS OF THE UNITED STATES OF AMERICA. EACH BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN LOS
ANGELES COUNTY IN THE STATE OF CALIFORNIA SHALL HAVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG
BORROWER(S), ON THE ONE HAND, AND LENDER, ON THE OTHER HAND, PERTAINING TO THIS NOTE OR TO ANY MATTER ARISING OUT OF OR RELATED
TO THIS NOTE; PROVIDED, THAT BORROWER ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF SAID COUNTY; AND FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE
LENDER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION WHERE NECESSARY TO COLLECT THE OBLIGATIONS, TO
REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF
LENDER. EACH BORROWER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH
COURT, AND EACH BORROWER HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE
OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY SUCH COURT. EACH BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY
SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO SUCH BORROWER AT BORROWER’S ADDRESS SET FORTH IN THE LOAN AND SECURITY AGREEMENT AND THAT SERVICE SO MADE
SHALL BE DEEMED COMPLETED UPON THE EARLIER OF EACH ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT IN THE U.S. MAIL, PROPER
POSTAGE PREPAID.

18.        AUTHORITY.
Each Borrower, and each person executing this Note on such Borrower's behalf, hereby represents and warrants to Lender that, by
its execution below, such Borrower has the full power, authority and legal right to execute and deliver this Note and that the
indebtedness evidenced hereby constitutes a valid and binding obligation of such Borrower without exception or limitation.

 

[Signature pages follow]

 

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        IN WITNESS WHEREOF,
each Borrower has executed this Senior Secured Promissory Note on the day and year first above written.

 

WEBXU, Inc., a Delaware
corporation

 

	By:	/J. Aaronson/	 

Name: Jeffrey Aaronson

Title: CFO

 

BONUS INTERACTIVE INC.,
a Delaware corporation

 

	By:	/J. Aaronson/	 

Name: Jeffrey Aaronson

Title: CFO

 

WEBXU MEDIA, INC., a Delaware corporation

 

	By:	/J. Aaronson/	 

Name: Jeffrey Aaronson

Title: CFO

 

LOT6 MEDIA, LLC, a California limited liability company

 

	By:	/J. Aaronson/	 

Name: Jeffrey Aaronson

Title: CFO

 

    	6

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