Document:

Exhibit 10.3

    
      

    

    AMENDMENT
      TO PURCHASE AGREEMENT

     

     

    This
      AMENDMENT
      (this
“Amendment”)
      is
      made and entered into as of November 30, 2006, by and among CHARYS
      HOLDING COMPANY, INC.,
      a
      Delaware corporation (“Purchaser”),
      CROCHET
      & BOREL SERVICES, INC., a
      Texas
      corporation (the
      “Corporation”),
      and
TROY
      CROCHET,
      a
      resident of the State of Texas (the “Seller”).

     

    WHEREAS,
      Purchaser, Corporation and Seller are parties to that certain Stock Purchase
      Agreement, dated as of June 5, 2006 (the “Stock Purchase Agreement”), as amended
      by that certain Letter Agreement dated October 3, 2006 (the Letter Amendment”
and any other amendments with respect to the Purchase Agreement (“Miscellaneous
      Amendments”) (the Stock Purchase Agreement, the Letter Amendment, and the
      Miscellaneous Amendments are hereinafter referred to as the “Purchase
      Agreement”);
      and

     

    WHEREAS,
      Section
      12.02
      of the
      Purchase Agreement provides that the Purchase Agreement may be amended by an
      instrument in writing authorized and signed by the parties to the Purchase
      Agreement; and

     

    WHEREAS,
      each of
      parties to the Purchase Agreement has determined that it is desirable to amend
      the Purchase Agreement as set forth in this Amendment;

     

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

     

    1.     Final
      Determination Date Cash Consideration. The
      Final
      Determination Date Cash Consideration as defined in the Purchase Agreement
      is an
      amount equal to $76,562,848 which shall be payable as provided in the Renewal
      Promissory Note and Security Agreement in the form attached hereto as
Exhibit
      1
      and
Exhibit
      2,
      respectively.

     

    2.     Make
      Whole Date.
      Section
      2.5(a)(i) is deleted and restated in its entirety as follows:

     

    “Make-Whole
      Date” means the date that is 30 days following the issuance of Purchaser’s Form
      10KSB or 10-K, as applicable, for fiscal year 2008, provided that if such date
      falls on a non-business day, the Make-Whole Date shall be the preceding business
      day.

     

    3.     Make
      Whole Deficit.
      Section
      2.5(a)(ii) is deleted and restated in its entirety as follows:

     

    “Make
      Whole Deficit”
means
      the value, if negative, of (A) the Target Stock Consideration Value,
minus
      (B) the
      product of (1) 8,008,000 as adjusted by the Stock Holdback Issuance Set Off
      multiplied
      by
      (2) the
      Average Market Price of the Purchaser Stock during the 15 consecutive trading
      days prior to the Make-Whole Date multiplied by the percentage of the Bonus
      Pool
      Amount which is earned.

     

    4.     Stock
      Holdback.
      The
      provisions of Section 2.08 permitting Purchaser to withhold a portion of the
      Stock Consideration are deleted and Purchaser agrees that it will issue 750,000
      shares of Purchaser’s Stock to Seller within 15 days after the Bond Offering
      contemplated by Purchaser’s October 10, 2006 engagement letter with McMahan
      Securities is closed and funded.

     

    5.     Aged
      Accounts Receivable Adjustment.
      Section
      2.09 is deleted in its entirety. Purchaser is not obligated to transfer any
      Aged
      Receivables to Seller and the number of shares remaining in the Stock Holdback
      will not be reduced under Section 2.09.

     

    6.     Spin
      Off Agreement.
      The
      Spin Off Agreement at Schedule
      6.15
      of the
      Purchase Agreement is deleted in its entirety and restated as attached hereto
      as
Schedule
      6.15.

     

    
      
        
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    7.     Ratification
      and Republication.
      Except
      as amended by this Amendment, the parties do hereby ratify and republish the
      Purchase Agreement.

     

    8.     Incorporation
      by Reference.
      The
      attachments to this Amendment referred to or included herein constitute integral
      parts to this Amendment and are incorporated into this Amendment by this
      reference.

     

    9.     Benefit.
      All the
      terms and provisions of this Amendment shall be binding upon and inure to the
      benefit of and be enforceable by the parties hereto, and their respective heirs,
      executors, administrators, personal representatives, successors and permitted
      assigns.

     

    10.     Construction.
      Words
      of any gender used in this Amendment shall be held and construed to include
      any
      other gender, and words in the singular number shall be held to include the
      plural, and vice versa, unless the context requires otherwise.

     

    11.     Multiple
      Counterparts.
      This
      Amendment may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

     

    12.     Entire
      Agreement.
      This
      Amendment and the Purchase Agreement, together with the exhibits and schedules
      thereto, contain the entire understanding of the parties with respect to the
      subject matter hereof, and may not be changed orally, but only by an instrument
      in writing signed by the party against whom enforcement of any waiver, change,
      modification, extension, or discharge is sought. Without limiting the generality
      of the foregoing, in the event of any of conflict between this Amendment and
      the
      Purchase Agreement, this Amendment shall control.

     

    13.     Condition
      Subsequent.
      If the
      Bond Offering contemplated by Purchaser’s October 10, 2006 engagement letter
      with McMahan Securities is not closed and funded by March 30, 2007, this
      Amendment to Purchase Agreement will be null and void and of no force or effect
      whatsoever.

     

    14.     Board
      Approval.
      This
      Amendment will not become effective until its
      execution is authorized or ratified by the Board of Directors of
      Purchaser.

     

    IN
      WITNESS WHEREOF,
      each of
      the parties hereto has duly executed and delivered this Amendment as of the
      date
      first above written.

     

    
      	 	
              CHARYS
                HOLDING COMPANY, INC.

            
	 	 
	 	 
	 	
              By

            	 
	 	 	
              Billy
                V. Ray, Jr., Chief Executive Officer

            
	 	 
	 	 
	 	
              CROCHET
                & BOREL SERVICES, INC.

               

            
	 	 
	 	
              By

            	 
	 	
            	
              Troy
                Crochet, Chief Executive Officer

            

    

     

    
      
        
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              TROY
                CROCHET

            
	 	 
	 	 
	 	 
	 	 
	 	
              TAMI
                CROCHET, joined in the execution of this Amendment for the purpose
                of
                binding and obligating the spouse’s community property interest in the
                C&B Shares to all of the terms, covenants, conditions, limitations
                and
                restrictions contained herein as respect the C&B
                Shares.

            

    

    Attachments:

    Exhibit
      1
      - Renewal Promissory Note

    Exhibit
      2
      - Security Agreement

    Schedule
      6.15 - Spin Off Agreement

    

    

    
      
        
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    Exhibit
      1

    Renewal
      Promissory Note

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    Exhibit
      2

    Security
      Agreement

    

    
      
        
           

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    Schedule
      6.15

    Spin
      Off Agreement

     

    
      The
        following general terms and conditions shall be more fully reflected in a
        definitive agreement to be negotiated in good faith and, if reasonably
        acceptable to both the Purchaser and the Seller, executed, on or prior to
        April
        30, 2007 (the “Definitive Agreement”). The Purchaser shall cause the Corporation
        to maintain separate books and records and separately audited financial
        statements for the Corporation during the period beginning on May 1, 2007
        and
        for each of the fiscal years of the Purchaser ending on April 30, 2011, 2012,
        and 2013 (the “Option Period”).

       

      Subject
        to the Definitive Agreement, during the Option Period, the Seller may cause
        the
        Purchaser to effectuate a spin-off of the Corporation (a “Spin-Off Transaction”)
        into a separate publicly-traded entity provided that the conditions set forth
        in
        this Schedule
        6.15
        are
        met.

       

      Subject
        to the Definitive Agreement, the Seller may only cause the Purchaser to
        effectuate a Spin-Off Transaction in the event that (a) during the three
        year
        period prior to the Seller’s notification of its intent to effectuate a Spin-Off
        Transaction, but not later than April 30, 2012 (the “Spin-Off Notice Date”) the
        aggregate net revenue of the Corporation was greater than or equal to
        $750,000,000, (b) during the three year period prior to the Spin-Off Notice
        Date, the aggregate net earnings of the Corporation are greater than or equal
        to
        $150,000,000, (c) the Seller and the Incentive Employees (the “Spin-Off
        Participants”) collectively hold in excess of 10,000,000 shares of the Purchaser
        Stock, and (d) the Market Price of the Purchaser Stock for twenty (20)
        consecutive trading days prior to the Spin-Off Notice Date is in excess of
        $20
        per share, adjusted for any splits or dividends occurring between April 30,
        2007
        and the Spin-Off Notice Date.

       

      Subject
        to the Definitive Agreement, the Spin-Off Transaction shall be effectuated
        by
        granting to each stockholder of the Purchaser as of the effective date of
        the
        Spin-Off Transaction one publicly traded share of the Corporation for each
        share
        of the Purchaser Stock held by such stockholder. Simultaneously with the
        issuance of such shares, each Spin-Off Participant shall tender to the Purchaser
        not less than 80% of the shares of the Purchaser Stock held by such Spin-Off
        Participant in exchange for an equal number of shares of the
        Corporation.Exhibit 10.4

    
      

    

    RENEWAL
      PROMISSORY NOTE

    

    Dated
      as of November 30, 2006

    

    

    FOR
      VALUE RECEIVED,
      the
      undersigned, CHARYS
      HOLDING COMPANY, INC.,
      a
      Delaware corporation (the “Maker”),
      promises to pay to the order of
      TROY D. CROCHET,
      an
      individual resident of the State of Texas (the “Holder”),
      an
      amount equal to $77,932,514.15 (such amount, being referred to as the
“Principal
      Amount”)
      in
      lawful money of the United States, together with interest thereon at the rate
      set forth below, pursuant to the terms and conditions set forth in this
      promissory note (this “Note”).

     

    1.     The
      Principal Amount, together with all accrued and unpaid interest on the entire
      Principal Amount, shall be due and payable by the Maker to the Holder at 202
      Castle Circle, Port Neches, Jefferson County, Texas, as follows:

     

    (a)     It
      is
      understood by the Holder that the Maker is attempting to secure financing in
      an
      amount of $150,000,000 (the “Target Raise”) pursuant to the Maker’s October 10,
      2006 engagement letter with McMahan Securities (the “Bond Offering”). Depending
      on the outcome of that financing, this Note shall be payable in the following
      manner:

     

    (i)     If
      the
      net proceeds of the Bond Offering after paying the fees, commissions and
      expenses of the offering is equal to $150,000,000, the proceeds to be received
      by the Maker will be used as described in Schedule
      1
      attached
      hereto. 

     

    (ii)     If
      the
      net proceeds of the Bond Offering after paying the fees, commissions and
      expenses of the offering is greater than $150,000,000 the amount raised in
      excess of $150,000,000 will be applied first to the working capital needs of
      the
      Maker’s subsidiaries in amounts deemed reasonably necessary by the Maker, not to
      exceed $5,000,000. Thereafter, the Maker will apply the entire remainder of
      the
      excess to the payment of this Note.

     

    (iii)     If
      the
      net proceeds of the Bond Offering after paying the fees, commissions and
      expenses of the offering is less than $150,000,000 then each of the amounts
      shown in Schedule 1 will be reduced by the percentage that the net proceeds
      of
      the Bond Offering is less than $150,000,000. Maker will also pay to Holder
      any
      amounts by which Maker and Holder can convince the other parties named on
      Schedule 1 to reduce the payments due to them.

     

    (b)     Provided,
      however, in any event, the Principal Amount and all accrued and unpaid interest
      on the Principal Amount will be payable on or before January 31, 2008. All
      payments will be applied first to accrued and then unpaid interest and the
      balance, if any, will be applied to the Principal Amount.

     

    (c)     Provided
      further, subject to the provisions of the preceding subparagraphs (a) and (b),
      at such time as the New Stream Commercial Finance, LLC financing, the Gottbetter
      Capital Finance, LLC financing, and the Cotton Sellers have been paid all sums
      owed to them by the Maker (the “Third Party Debt”), the Maker agrees that any
      receivable proceeds in excess of sums needed to operate the Maker’s C & B
      Holdings subsidiaries, Crochet & Borel Services, Inc and Cotton Holdings,
      will be paid to the Holder to reduce the Principal Amount. As used herein,
      (i)
      the New Stream Commercial Finance, LLC financing means the financing of accounts
      receivable of Crochet & Borel Services, Inc., as described in an 8-K filed
      by the Maker with the Securities and Exchange Commission on September 8, 2006,
      and the New Stream Commercial Finance, LLC financing of accounts receivable
      of
      Ayin Tower Management Services Inc., as described in an 8-K filed by the Maker
      with the Securities and Exchange Commission on September 8, 2006, (ii) the
      Gottbetter Capital Finance, LLC financing means the financing as described
      in an
      8-K filed by the Maker with the Securities and Exchange Commission on September
      6, 2006, and (iii) the Cotton Sellers means those parties to the loan agreements
      identified in an 8-K filed by the Maker with the Securities and Exchange
      Commission on December 14, 2006.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    2.     From
      and
      after November 30, 2006, through the Maturity Date, or, if sooner, the date
      on
      which this Note has been paid in full, simple interest shall accrue on the
      unpaid Principal Amount at the applicable federal short-term rate (such rate
      being determined from a one-month average of market yields from marketable
      obligations of the United States with maturities of three years or less) for
      May
      2006 of 4.74% as set forth in IRS Rev. Rul. 2006-22 calculated on the basis
      of
      365 days per year and actual days elapsed and computed on the daily unpaid
      Principal Amount.

     

    3.     To
      the
      extent of $19,000,000, plus accrued interest on such amount since June 5, 2006,
      this Note is given in renewal and extension (and not in cancellation) of that
      certain Seller’s Note by and between the Maker and the Holder dated June 5,
      2006.

     

    4.     This
      Note
      is secured by a Security Agreement of even date herewith as described in
Schedule
      2
      attached
      hereto (the “Security Agreement”). Notwithstanding anything herein contained to
      the contrary, the Maker shall have no obligation with respect to the Security
      Agreement until such time as all lien holders described in Schedule
      3
      attached
      hereto have consented to execution of this Note and the Security
      Agreement.

     

    5.     In
      the
      event of any conflict between the terms of this Note or any of the other
      agreements executed by the Maker and the Holder with respect to the subject
      matter hereof, or any of the attachments referred to therein or herein, the
      terms of this Note shall control.

     

    6.     This
      Note
      shall be construed and enforceable in accordance with the laws of the State
      of
      Texas.

     

    IN
      WITNESS WHEREOF,
      the
      Maker has executed this Note effective as of the ___ day of November,
      2006.

     

     

    
      	 	
              CHARYS
                HOLDING COMPANY, INC.

            
	 	 	 
	 	 	 
	 	
              By

            	 
	 	 	
              Billy
                V. Ray, Jr.,

            
	 	 	
              Chief
                Executive Officer

            

    

    

    Payment
      of this Note is hereby guaranteed by all the undersigned corporations, jointly
      and severally:

    

    
      	
              C
                & B HOLDINGS, INC.

            	 	
              CROCHET
                & BOREL SERVICES, INC.

            	 	
              AYIN
                HOLDING COMPANY, INC.

            
	 	 	 	 	 
	 	 	 	 	 
	
              By

            	 	 	
              By

            	 	 	
              By

            	 
	 	
              Billy
                V. Ray, Jr.,

            	 	 	
              Troy
                D. Crochet,

            	 	 	
              Jimmy
                Taylor,

            
	 	
              Chief
                Executive Officer

            	 	 	
              President

            	 	 	
              President

            

    

     

    Attachments:

    Schedule
      1 - Bond Offering Use of Proceeds

    Schedule
      2 - The Security Agreement

    Schedule
      3 - Consent of Lien Holders

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
    

    
       

      Schedule
        1

      

      Bond
        Offering Use of Proceeds

      

      $150,000,000
        Target Raise

      

      
        	
                CTSI/MSAI
                  Seller Note

              	 	
                $

              	
                77,613,000

              	 
	
                Cotton
                  Sellers Note 

              	 	 	
                27,500,000

              	 
	
                C&B
                  Sellers Note 

              	 	 	
                25,000,000

              	 
	
                Redemption
                  of Convertible Debenture (A) 

              	 	 	
                25,000,000

              	 
	
                Working
                  Capital 

              	 	 	
                887,000

              	 
	
                Cash
                  Provided from Acquisitions (B)

              	 	 	
                (6,000,000

              	
                )

              
	
                Total
                  Raise

              	 	
                $

              	
                150,000,000

              	 

      

       

      

        
          

        

      

      NOTES:

      

      
        	 	
                (A)

              	
                Includes
                  the redemption premium.

              

      

      
        	 	
                (B)

              	
                Acquisitions
                  include CTSI, MSAI, Cotton.

              

      

       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      2

    The
      Security Agreement

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      3

    Consent
      of Lien Holders

     

      Consents
        must be obtained from the following:

      

      Cotton
        Holdings I, Inc.

      

      Cotton
        Commercial USA, LP

      

      Cotton
        Restoration, LP

      

      Chad
        Weigman

      

      Blake
        Stansell

      

      Bryan
        Michalsky

      

      James
        Scaife

      

      Randall
        Thompson

      

      Pete
        Bell

      

      Daryn
        Ebrecht

      

      Russell
        White

      

      Johnny
        Slaughter

      

      Imperium
        Master Fund, Ltd.

      

      New
        Stream Commercial Finance, LLC

      

      Gottbetter
        Capital Finance, LLC

      

      Fort
        Mason Master, LP

      

      UBS
        Alternative & Quantitative Investments, LLC

      

      Fort
        Mason Partners, LP

      

      GCA
        Strategic Investment Fund Limited

      

      PCM
        II,
        LLC

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