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Exhibit
10.5
EXECUTION
COPY
FIRST AMENDMENT TO
ADDITIONAL INVESTMENT SENIOR SECURED
CONVERTIBLE PROMISSORY
NOTES
FIRST AMENDMENT TO
ADDITIONAL INVESTMENT SENIOR SECURED CONVERTIBLE PROMISSORY
NOTE (this “ First Amendment ”), dated as of
May 8, 2008, by and between Distributed Energy Systems Corp.,
a Delaware corporation (the “ Company ” )
and Perseus Partners VII, L.P., a Delaware limited partnership (the
“ Holder ”). Unless otherwise indicated, all
capitalized terms used herein and not otherwise defined have the
respective meanings provided such terms in the Purchase Agreement
and the Notes referred to below.
WITNESSETH
:
WHEREAS , the Company
and the Holder are parties to a Securities Purchase Agreement,
dated as of May 10, 2007 and amended on March 13, 2008
(as further amended, modified and/or restated from time to time,
the “ Purchase Agreement ”);
WHEREAS , under the
terms of the Purchase Agreement, on March 13, 2008 the Company
issued to the Holder a senior secured convertible promissory note
in the principal amount of $1,500,000.00 (the “ Additional
Investment Note ”);
WHEREAS , on
April 1, 2008, the Company issued to the Holder an additional
senior secured convertible promissory note in the principal amount
of $488,304.12 as payment for interest due and payable on the
Additional Investment Note (the “ PIK Note ”,
and together with the Additional Investment Note, the “
Notes ”, and each individually, a “ Note
”); and
WHEREAS , the Company
has requested an amendment of certain provisions of the Notes as
herein provided;
NOW, THEREFORE, it is
agreed:
Amendment of Each Note .
The Holder and the Company hereby agree that as of the First
Amendment Effective Date (as defined below) and through the close
of business on May 16, 2008, Section 4(i) of each Note is
amended by:
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(a) |
replacing the Net Working Capital benchmark of $3,500,000 set
forth in Section 4(i)(i) with a new benchmark of $2,000,000;
and |
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(b) |
replacing the unrestricted cash and cash equivalents benchmark
of $1,000,000 set forth in Section 4(i)(ii) with a new
benchmark of $2,000,000. |
After the close of business on
May 16, 2008, each benchmark will revert to the benchmark in
place prior to the First Amendment Effective Date.
Representations and Warranties
. The representations and warranties of the Company contained
in the Purchase Agreement or in any other Transaction Document that
are qualified as to materiality are true and correct, and all other
representations and warranties of the Company contained in the
Purchase
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