SECOND AMENDMENT TO AMENDMENT TO DEBENTURES AND WARRANTS, AGREEMENT AND WAIVER
EXHIBIT 10.2
SECOND
AMENDMENT TO
AMENDMENT
TO DEBENTURES AND WARRANTS,
THIS
SECOND AMENDMENT TO AMENDMENT TO DEBENTURES AND WARRANTS, AGREEMENT AND WAIVER
(this “Agreement”) is
entered into on July 2, 2009 by and among Ecotality, Inc., a Nevada
corporation (the “Company”), on the one hand,
and Enable Growth Partners LP
(“EGP”), Enable Opportunity Partners LP (“EOP”), Xxxxxx Diversified
Strategy Master Fund LLC, Ena (“Xxxxxx”, together with EGP,
EOP and Xxxxxx, the “Enable
Funds”), and BridgePointe Master Fund Ltd. (“BridgePointe,” together with
the Enable Funds, each individually referred to as an “Existing Holder” and
collectively as the “Existing
Holders” or the
“Existing Investors”). Capitalized terms not defined in this Agreement
shall have the meanings ascribed to such terms in the May 2009 Amendment (as
defined below).
Recitals
WHEREAS, the Debtors and the
Existing Holders entered into an Amendment to Debentures and Warrants, Agreement
and Waiver on or about May 15, 2009, as amended by the First Amendment (the
“May 2009
Amendment”);
WHEREAS, on or about June
, 2009, the Existing Investors entered into a First Amendment to
Amendment to Debentures and Warrants, Agreement and Waiver (the “First Amendment”);
and
WHEREAS, the Company and the
Investors now desire that the terms of the May 2009 Amendment be further
modified and clarified and have entered into this Agreement to document their
agreement regarding such modifications.
NOW THEREFORE, in
consideration of the mutual promises and agreements contained herein, and
intending to be legally bound hereby, the undersigned parties hereby agree as
follows:
A. Incorporation of Preliminary
Statements. The Recitals set forth above by this reference hereto are
hereby incorporated into this Agreement.
B. Amendment to Section 11(b)
of the May 2009 Amendment.
(1) The
following definition is added in Section 11(b) of the May 2009 Amendment,
immediately following the definition of “Included Holder’s Fully Diluted
Amount”:
“Included Holder’s
Augmented Fully Diluted Amount” shall mean the sum of (i) the Included
Holder’s Fully Diluted Amount, plus (ii) the number of shares of Common Stock of
the Company that have been issued to the Included Holder by the Company
pursuant to the conversion of the Included Holder’s Debentures and the exercise
of the Included Holder’s Warrants, since their respective issuance dates, and
regardless of whether or not such shares of Common Stock have been sold by the
Included Holder.
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(2) Amendment to Section 12 of
the May 2009 Amendment. In the first sentence of Section 12 of the May
2009 Amendment, the phrase “Included Holder’s Fully Diluted Amounts” is hereby
replaced with the phrase “Included Holder’s Augmented Fully Diluted Amounts” and
the phrase “Included Holder’s Fully Diluted Amount” is hereby replaced with the
phrase “Included Holder’s Augmented Fully Diluted Amount.”
The
amendments described in this Section B are conditioned upon, and shall not take
effect until, substantively identical revisions are made to any warrants issued
or issuable in connection with the Bridge Notes (as defined in the May 2009
Amendment).
(3) Amendment to Section 4 of
the May 2009 Amendment. The date in the first sentence of Section 4 of
the May 2009 Amendment which reads “June 30, 2009” is hereby amended and
replaced with “July 2, 2009.”
C. Agreement and Clarification
Regarding Amended and Exchanged Securities.
(1) In
conjunction with the May 2009 Amendment, the Company signed Amended and Restated
Warrants (the “Amended and
Restated Warrants”), in the form of Exhibit A attached hereto, in the
name of each Existing Investor to include the Increased Amount of Warrants set
forth in Schedule A to the May 2009 Amendment Agreement. The Company and the
Existing Holders each hereby agree and acknowledge that the Amended and Restated
Warrants (as they may be further adjusted by the June 30 True-Up, as defined in
the May 2009 Amendment) were and are being issued in substitution for and not in
satisfaction of the Warrants originally issued in November, 2007 and December
2007, respectively, and for no additional cash consideration.
In
addition, to the extent that amended and restated Debentures are issued to
reflect the amendments of the May 2009 Amendment, the Company and the Existing
Holders each hereby agree and acknowledge that such amended and restated
Debentures are being issued in substitution for and not in satisfaction of the
Debentures originally issued in November, 2007 and December 2007, respectively,
and for no additional cash consideration.
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It is
expressly agreed and understood that, pursuant to Rule 144, the holding period for
the Debentures, as amended (and for the underlying shares issuable upon
the conversion thereof) and for the Amended and
Restated Warrants (and for the underlying shares issuable upon the
cashless exercise thereof) shall each tack back (the “Rule 144 Tacking”) to the
original November 2007 or December 2007 issue date (as applicable) of the
Warrants and Debentures, respectively. In addition, in lieu of the issuance any
new warrant certificates in satisfaction of the Make-Up Warrants under Section
12 of the May 2009 Amendment, the Company and Existing Holders agree that in
lieu thereof, and for no new cash consideration, each Existing Holder shall
exchange its Amended and Restated Warrant held immediately prior to the
Triggering Issuance giving rise to the Make-Up Warrant issuance for an Amended
and Restated Warrant reflecting the aggregate amounts required to be held by
such Existing Holder following such Triggering Issuance under Section 12 of the
May 2009 Amendment, with the holding period of such warrants tacking back to the
original November 2007 or December 2007 issue date, as applicable. The Company
agrees not to take a position contrary to this Section C. In addition to, and
without limiting the rights and obligations of the parties under the Transaction
Documents (including, without limitation, the provisions of Section 4.1 of the
Securities Purchase Agreements), the Company agrees to take all actions,
including, without limitation, use its best efforts to cause the issuance by its
legal counsel of any necessary legal opinions, to issue to the Existing Holders
any Debentures, as amended (and for the underlying shares issuable upon the
conversion thereof) and the Amended and Restated Warrants (and the underlying
shares issuable upon the cashless exercise thereof) without restriction and not
containing any restrictive legend without the need for any action by the
Existing Holder, except as otherwise provided herein, such issuance to otherwise
be made in accordance with the terms and conditions of the applicable
Transaction Documents.
(2) Upon
an Existing Holder’s conversion of a Debenture, as amended or cashless exercise
of any of the Amended and Restated Warrants, following the receipt by the
Company of a standard Rule 144 representation letter from such Existing Holder,
the Company shall issue the applicable number of unrestricted and unlegended
shares to such Existing Holder in such exercise, provided that:
(a) the
Company shall not require any legal opinion from the Existing Holders as to the
Rule 144 Tacking,
(b) the
Company may require reasonable backup from the exercising holder regarding its
non-affiliate status for Rule 144 purposes, provided that the Company shall not
require another opinion of counsel as to non-affiliate status from BridgePointe
Master Fund Ltd. (“BridgePointe”) in addition to
the BridgePointe Opinion (as defined below) previously provided, so long as
BridgePointe represents in the applicable Rule 144 Representation Letter (i)
that BridgePointe does not have an appointee sitting on the Company’s board of
directors, and (ii) there has been no other material change of facts or law that
could reasonably be expected to change BridgePointe’s non-affiliate status since
the date of the BridgePointe Opinion. For purposes hereof, the “BridgePointe Opinion” shall
mean the opinion of counsel provided, on or about June 26, 2009, by the Law
Office of Xxxx X. Xxxxxxxx, APC to Xxxxxxxx Stock Transfer, Inc. on
BridgePointe’s behalf.
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(3) At
the option of any Existing Holder, in addition to, and without limiting the
rights and obligations under the Transaction Documents and Section (C)(1) and
(2) above, upon an Existing Holder’s conversion of a Debenture, as amended or
cashless exercise of any of the Amended and Restated Warrants in reliance on
Rule 144, if the Company’s transfer agent requires a legal opinion with respect
to the issuance of Common Stock without a restrictive legend in connection
therewith, following the receipt by the Company of a Rule 144 opinion from
outside counsel to the applicable Existing Holder, the Company shall issue the
applicable number of unrestricted and unlegended shares to such Existing Holder
otherwise in accordance with, and subject to the terms and conditions of the
applicable Transaction Documents.
D. No Further
Amendments. Except as set forth above, the May 2009 Amendment shall
remain in full force and effect in accordance with its terms.
E. Counterparts. This
Agreement may be executed in counterparts and delivered by facsimile and all so
executed and delivered shall constitute a single original.
[signature
pages follow]
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IN WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first written
above.
ECOTALITY, INC., a
Nevada corporation
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By:
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Name:
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Title:
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President
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[signature page of Holders/Investors
follows]
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Convertible
Debenture Holders’ Signature Page
By:
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Name:
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Title:
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ENABLE
GROWTH PARTNERS LP
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By:
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Name:
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Title:
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ENABLE
OPPORTUNITY PARTNERS LP
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By:
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Name:
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Title:
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XXXXXX
DIVERSIFIED STRATEGY MASTER FUND LLC, ENA
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By:
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Name:
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