AMENDMENT NO. 1 TO
SECURITY AGREEMENT
THIS
AMENDMENT NO. 1 TO SECURITY AGREEMENT (“
Amendment
”) is made as of June 9, 2008, by and among Auriga
Laboratories, Inc., a Delaware corporation (the “
Company
”), and the parties listed on the signature page hereto
as “Secured Parties”.
R E C I T A L S
WHEREAS,
the Company and Prospector Capital Partners, LLC entered into
that certain Security Agreement, dated February 13, 2008 (the
“ Security
Agreement ”);
WHEREAS,
the Company and Prospector Capital Partners, LLC desire to
amend the Security Agreement to specify that the
“Notes” (as defined in the Security Agreement)
shall be defined as the Amended and Restated Senior Secured
Promissory Note originally issued under the Senior Secured
Note and Warrant Purchase Agreement, dated February 13, 2008,
and amended as of the date hereof (the “Amended Prior
Note”) as well as the Notes issued to Prospector Capital
Partners II, LLC pursuant to the Senior Secured Convertible
Promissory Note Purchase Agreement, dated as of the date
hereof, by and between the Company and Prospector Capital
Partners II, LLC, and to make certain other changes to the
Security Agreement as set forth below; and
WHEREAS,
pursuant to Section 7.6 of the Security Agreement, any term of
the Security Agreement may be amended with the written consent
of the Company and Prospector Capital Partners,
LLC.
NOW,
THEREFORE, in consideration of the promises and conditions
contained herein, the parties hereby agree as
follows:
1.
The
first recital of the Security Agreement be, and it hereby is,
amended and restated to read as follows:
“WHEREAS,
the Company issued and may issue additional Notes to the
Secured Parties;
2.
The
following definitions are hereby added to Section 1.1 of the
Security Agreement:
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