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AMENDMENT TO DEBENTURE AND INVESTOR REGISTRATION RIGHTS AGREEMENT
THIS AMENDMENT TO DEBENTURE AND REGISTRATION RIGHTS AGREEMENT (the
"Amendment") is made and entered into effective as of October 30, 2006, to amend
that certain Investor Registration Rights Agreement (the "Agreement") dated
December 30, 2005 by and among CIRTRAN CORP., a Nevada corporation (the
"Company") and CORNELL CAPITAL PARTNERS, LP (the "Investor"). The Company and
the Investor may each be referred to herein as a "Party" and collectively as the
"Parties."
Recitals:
WHEREAS, on or about December 30, 2005, the Company and the Investor
entered into a series of financing agreements (the "December Transaction
Documents"), including, without limitation a Securities Purchase Agreement, a
convertible debenture issued pursuant thereto, and an Investor Registration
Rights Agreement, pursuant to which, among other things, the Investor agreed to
advance the Company the aggregate of One Million Five Hundred Thousand Dollars
($1,500,000) in exchange for the issuance by the Company of a secured
convertible debenture; and
WHEREAS, on or about August 23, 2006, the Parties entered into another
series of financing agreements (the "August Transaction Documents"), including,
without limitation a Securities Purchase Agreement, a convertible debenture (the
"August Debenture") issued pursuant thereto, and an Amended and Restated
Investor Registration Rights Agreement (the "Amended IRRA"), pursuant to which,
among other things, the Investor agreed to advance the Company the aggregate of
One Million Five Hundred Thousand Dollars ($1,500,000) in exchange for the
issuance by the Company of a secured convertible debenture
WHEREAS, the parties hereto desire to amend the August Debenture and
the Amended IRRA to extend certain deadlines contained therein; and
WHEREAS, all terms in the August Debenture and the Amended IRRA, except
as modified herein, and the terms contained in the December Transaction
Documents and the August Transaction Documents, shall remain in full force and
effect.
NOW, THEREFORE, in consideration of the premises and the mutual
promises, conditions and covenants contained herein and other good and valuable
consideration, receipt of which is hereby acknowledged, the parties hereto agree
as follows:
1. Recitals. The foregoing recitals are hereby incorporated
herein by reference and acknowledged as true and correct by
the parties hereto.
2. Amended IRRA. Section 2(a) of the Amended IRRA is hereby
amended and restated in its entirety to read as follows:
"(a) Subject to the terms and conditions of this
Agreement, the Company shall prepare and file with the SEC, no
later than December 31, 2006 (the "Scheduled Filing
Deadline"), a registration statement on Form S-1 or SB-2 (or,
if the Company is then eligible, on Form S-3) under the 1933
Act (the "Initial Registration Statement") for the
registration for the resale by all Investors who purchased
Convertible Debentures pursuant to the Securities Purchase
Agreement 206,900,000 shares of Common Stock to be issued upon
conversion of the Convertible Debentures issued pursuant to
the Securities Purchase Agreement and the Securities Purchase
Agreeement dated December 30, 2005, as well as fifteen million
(15,000,000) shares of Common Stock to be issued upon
converstion of the Warrant dated August 23, 2006, and ten
million (10,000,000) shares of Common Stock to be issued upon
conversion of the Warrant dated December 30, 2005. The Company
shall cause the Initial Registration Statement to remain
effective until all of the Registrable Securities have been
sold. Prior to the filing of the Registration Statement with
the SEC, the Company shall furnish a copy of the Initial
Registration Statement to the Investors for their review and
comment. The Investors shall furnish comments on the Initial
Registration Statement to the Company within twenty-four (24)
hours of the receipt thereof from the Company."
3. August Debenture. The August Debenture is hereby amended as
follows:
(A) Section 1.02(b) is amended and restated to read in its
entirety as follows:
(b) The Holder agrees that it may onlyt convert any
amount of principal or interest of the Debenture in
accordance with the terms and conditions of the
Lock-up Agreement by and between the parties hereto
dated July 27, 2006, until the Company has
effectuated an increase in its authorized capital. In
the event that the Company has not effectuated such
increase in its authorized capital by December 31,
2006, such failure shall constitute an event of
default on parallel with those set forth in Section
3.01 below and subject to the same consequences as
those listed in Section 3.01 below.
(B) Section 2.01 is amended and restated to read in its
entirety as follows:
Section 2.01 Amendments and Waiver of Default. The
Debenture may only be amended upon the written
consent of both the Company and the Holder.
Notwithstanding the above, without the consent of the
Holder, the Debenture may be amended to cure any
ambiguity, defect or inconsistency, or to provide for
assumption of the Company obligations to the Holder.
(C) Paragraph 4.03 is amended and restated to read in its
entirety as follows:
Section 4.03 Termination of Conversion Rights. The
Holder's right to convert the Debenture into the
Common Stock in accordance with Section 4.01 hereof
shall terminate on April 23, 2009, and this Debenture
shall be automatically converted on that date in
accordance with the formula set forth in Section 4.01
hereof, and the appropriate shares of Common Stock
and amount of interest shall be issued to the Holder.
(D) Schedule 1.01 is amended and restated to read in its
entirety as follows:
SCHEDULE 1.01
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REPAYMENT SCHEDULE
March 23, 2007 $200,000
June 23, 2007 $200,000
September 23, 2007 $200,000
December 23, 2007 $200,000
March 23, 2008 $200,000
June 23, 2008 $200,000
September 23, 2008 $200,000
April 23, 2009 $100,000 plus any accrued and unpaid interest.
[SIGNATURE PAGES TO IMMEDIATELY FOLLOW]
IN WITNESS WHEREOF, the parties have signed and delivered this
Amendment Agreement on the date first set forth above.
CIRTRAN CORP. CORNELL CAPITAL PARTNERS, LP
By: /s/ Xxxxx X. Xxxxxxxx By: Yorkville Advisors, LLC
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Name: Xxxxx X. Xxxxxxxx Its: General Partner
Title: President & CEO
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Portfolio Manager
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