Document:

Unassociated Document

    OMNIBUS
      AMENDMENT AND WAIVER NO. 3

    

    This
      Omnibus Amendment and Waiver No. 3 (this “Amendment”),
      dated
      as of December 11, 2007, by and between Conversion Services International,
      Inc.,
      a Delaware corporation (the “Company”),
      CSI
      Sub Corp. (DE), a Delaware corporation (“CSI
      Sub”),
      DeLeeuw Associates, Inc., a Delaware corporation (“DeLeeuw”
and,
      together with the Company and CSI Sub, the “Credit
      Parties”
and,
      each a “Credit
      Party”)
      and
      Laurus Master Fund, Ltd., a Cayman Islands company (“Laurus”),
      amends (i) that certain Security Agreement, dated as of February 1, 2006 by
      and
      among the Credit Parties and Laurus (as amended, modified or supplemented from
      time to time, the “Security
      Agreement”);
      (ii)
      that certain Secured Non-Convertible Revolving Note issued by the Company to
      Laurus on February 1, 2006 (as amended, modified or supplemented from time
      to
      time, the “Revolving
      Note”);
      and
      (iii) the other Ancillary Agreements (as defined in the Security Agreement)
      (together with the Security Agreement and the Revolving Note, the “Loan
      Documents”).
      Capitalized terms used but not defined herein shall have the meanings given
      them
      in the Security Agreement.

    

    WHEREAS,
      the Credit Parties and Laurus have agreed to make certain changes to the
      Security Agreement and the Revolving Note as set forth herein; and

     

    NOW,
      THEREFORE, in consideration of the above, and for other good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged,
      the
      parties hereto agree as follows:

    

    1. Amendment
      to Revolving Note. The
      first
      full paragraph under the title “SECURED
      NON-CONVERTIBLE REVOLVING NOTE”
on
      the
      first page of the Revolving Note shall be replaced in its entirety with the
      following:

     

    FOR
      VALUE
      RECEIVED, CONVERSION SERVICES INTERNATIONAL, INC. a Delaware corporation (the
      “Parent”)
      and
      the other companies listed on Exhibit A attached hereto (such other companies
      together with the Parent, each a “Company” and collectively, the “Companies”),
      jointly and severally, promises to pay to LAURUS MASTER FUND, LTD., c/o M&C
      Corporate Services Limited, P.O. Box 309 GT, Ugland House, South Church Street,
      George Town, Grand Cayman, Cayman Islands, Fax: 345-949-8080 (the “Holder”)
      or its
      registered assigns, on order, the sum of Three Million Dollars ($3,000,000),
      or,
      if different, the aggregate principal amount of all “Loans” (as such term is
      defined in the Security Agreement referred to below), together with any accrued
      and unpaid interest hereon, on March 31, 2008 (the “Maturity
      Date”)
      if not
      sooner paid.

     

    2. Amendment
      to Security Agreement.
      Laurus
      and the Credit Parties hereby agree that, effective on the Effective Date,
      the
      definition of “Capital Availability Amount” set forth in Annex A of the Security
      Agreement shall be replaced with the following:

     

    “Capital
      Availability Amount”
means
      $3,000,000.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    3. Structuring
      Payment.
      In
      consideration for the agreements set forth herein, the foregoing agreements
      are
      subject to the receipt by Laurus Capital Management, LLC of a payment of $25,000
      by the Credit Parties. 

     

    MISCELLANEOUS

    

    4. Effective
      Date.
      This
      Amendment shall be effective (the “Effective
      Date”)
      on the
      first date upon which each Credit Party and Laurus shall have executed and
      the
      Credit Parties shall have delivered to Laurus their respective counterpart
      signatures to this Amendment. 

     

    5. Representations,
      Warranties and Covenants.
      Each
      Credit Party hereby represents and warrants to Laurus that after giving effect
      to this Amendment: (i) on the date hereof, all representations, warranties
      and
      covenants made by such Credit Party in connection with the Loan Documents are
      true, correct and complete; and (ii) on the date hereof, all of each Credit
      Party’s covenant requirements set forth in the Loan Documents have been
      met.

    

    6. No
      Waiver of Other Defaults.
      Upon
      the occurrence and during the continuance of any further Events of Default
      that
      may occur after date of this Agreement, Laurus may, at its election, exercise
      any rights and remedies authorized by the Loan Documents and/or applicable
      law.
      Laurus’ rights and remedies under the Loan Documents shall be cumulative. Laurus
      shall have all other rights and remedies not inconsistent herewith or therewith
      as provided by law or in equity. No exercise by Laurus of one right or remedy
      shall be deemed an election, and no waiver by Laurus of any Event of Default
      on
      the part of the Credit Parties shall be deemed a continuing waiver. No delay
      by
      Laurus shall constitute a waiver, election, or acquiescence by it. 

    

    7. Further
      Assurances.
      The
      Credit Parties will each take such other actions as Laurus may reasonably
      request from time to time to accomplish the objectives of this
      Agreement.

    

    8. No
      Other Changes.
      Except
      as specifically set forth in this Amendment, there are no other amendments,
      modifications or waivers to the Loan Documents, and all of the other forms,
      terms and provisions of the Loan Documents remain in full force and
      effect.

    

    9. Limited
      References.
      From
      and after the Amendment Effective Date, all references to the Revolving Note,
      the Security Agreement and/or any of the other Ancillary Agreements shall be
      deemed to be references to the such agreements as modified hereby.

    

    10. Governing
      Law; Assignments; Counterparts.
      This
      Amendment shall be binding upon the parties hereto and their respective
      successors and permitted assigns and shall inure to the benefit of and be
      enforceable by each of the parties hereto and their respective successors and
      permitted assigns. THIS
      AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED BY
      THE
      LAW OF THE STATE OF NEW YORK.
      This
      Amendment may be executed in any number of counterparts, each of which shall
      be
      an original, but all of which shall constitute one instrument. 

    

    
      
        
        

      

      
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    [THE
      REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      each
      Credit Party and Laurus has caused this Amendment to be signed in its name
      effective as of this 11th day of December, 2007.

     

    
      	 	 	 
	 	
              CONVERSION
                SERVICES 

              INTERNATIONAL,
                INC.

            
	 
 	 
 	 
 
	 	By:	/s/Scott
              Newman
	 	Name:	Scott Newman
	 	Title:	Chief Executive
              Officer

    

     

    
      	 	 	 
	 	
              CSI
                SUB
                CORP. (DE)

            
	 
 	 
 	 
 
	 	By:	/s/Scott
              Newman
	 	Name:	Scott Newman
	 	Title:	 

    

     

    
      	 	 	 
	 	
              DELEEUW
                ASSOCIATES, INC. 

            
	 
 	 
 	 
 
	 	By:	/s/Scott
              Newman
	 	Name:	Scott Newman
	 	Title:	 

    

     

    
      	 	 	 
	 	
              LAURUS
                MASTER FUND, LTD.

            
	 
 	 
 	 
 
	 	By:	/s/Scott
              Bluestein
	 	Name:	Scott Bluestein
	 	Title:	Authorized
              Signatory

    

     

    
      
        
        

      

      
        4EXECUTION
        COPY

    

     

    FIRST
      AMENDMENT TO ASSET PURCHASE AGREEMENT

     

    THIS
      FIRST AMENDMENT (the “Amendment”)
      to the
      ASSET PURCHASE AGREEMENT dated as
      of
      September 13, 2007 (the “Agreement”)
      is
      entered into by and among ProElite, Inc., a New Jersey corporation
      (“Company”),
      Future Fight Productions, Inc., a Hawaii corporation, (“Seller”)
      and
      the holders of one hundred percent (100%) of the outstanding shares of capital
      stock, Thomas Jay Thompson and Odd Haugen (collectively, the “Shareholders”).
      

     

    The
      Company, Seller and the Shareholders hereby agree to amend the Agreement as
      follows (capitalized terms not defined herein shall have the meanings ascribed
      to them in the Agreement):

     

    1.  Section
      1.4(b)
      of the
      Agreement is hereby amended and restated in its entirety as
      follows:

     

    (b) Additional
      Consideration.
      Company
      shall pay an additional One Hundred Thousand Dollars ($100,000.00) cash
      (“Additional
      Consideration”)
      to the
      Seller within three (3) business days of the first anniversary of the Closing,
      subject to the following conditions:

     

    (i)  Seller’s
      twelve (12) months’ earnings before interest, taxes, depreciation and
      amortization (“EBITDA”)
      ending
      on November 30, 2008 exceeds $195,000. EBITDA shall not include any non-Business
      related expenses incurred by the Company. The EBITDA calculations for the
      twelve-month period ending November 30, 2008 shall be prepared by Company or
      its
      representative from the records of the Company. 

     

    (ii)  Seller
      and Shareholders have secured releases, permits,
      approvals and consents from all Persons as may be required for the Company
      to
      exploit and use the Content
      (the “Releases”)
      within
      12 months of the Closing Date. 

     

    (iii)  If
      Seller
      has satisfied Section
      1.4(b)(i)
      but is
      unable to satisfy the condition in Section
      1.4(b)(ii),
      fifty
      percent (50%) of the Additional Consideration shall be paid to Seller only
      upon
      Seller obtaining the Releases to the satisfaction of the Company, subject to
      Section
      7.2
      below.

     

    2. Section
      2.11 is hereby amended with the deletion of the following:

     

    “,
      and,
      that based on such financial records, Company will be able to cause an audit
      to
      be completed for at least the last two fiscal years.”

     

    3. Section
      5.2 (i) is hereby amended and restated in its entirety as follows:

     

    “Seller
      shall have terminated that certain License Agreement, by and between Seller
      and
      Direct Response Specialist, LLC, a Hawaii limited liability company
      (“Direct
      Response”),
      dated
      as of October 4, 2004.”

     

    4. Section
      7.2 is hereby amended with the addition of the following sentence at the end
      thereof:

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    “Notwithstanding
      anything to the contrary, in the event that: (1) the Company incurs Company
      Damages which have not yet been satisfied by the Seller and the Shareholders,
      and (2) Additional Consideration is payable to Seller pursuant to Section
      1.4(b)
      above,
      then the Company may, at its option, apply all or a portion of the Additional
      Consideration to satisfy the Company Damages.”

     

    4. Except
      as
      amended herein, the Agreement shall remain in full force and
      effect.

     

    IN
      WITNESS WHEREOF, the Parties have accepted and agreed to this Amendment of
      the
      Agreement, and have executed this Amendment as of December 7, 2007.

     

    
      	 	
              PROELITE,
                INC.

            
	 	 
	 	 
	 	
              By:
                /s/ Edward Hanson                            

                    
                Edward Hanson, Chief Financial Officer

            
	 	 
	 	 
	 	 
	 	
              FUTURE
                FIGHT PRODUCTIONS, INC.

            
	 	 
	 	 
	 	
              By:
                /s/ Thomas Jay Thompson                  

                    
                Thomas Jay Thompson, President

            
	
              SHAREHOLDERS:

            	 
	 	 
	 	 
	 	 
	/s/ Thomas Jay Thompson                  	 
	
              Thomas
                Jay Thompson

            
	 
	/s/ Odd Haugen                                      
	
              Odd
                Haugen

            

    

     

     

    
      
         

      

      
        B-2

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