[COMPANY LOGO] |
| September 15, 2003 |
Weichert Enterprise LLC DL Holdings I, LLC |
| Re: | Eos International, Inc./Weichert Enterprise LLC/ DL Holdings I, LLC |
Reference is made to the Agreement by and among Eos International, Inc. (“Eos”), Weichert Enterprise LLC (“Weichert”), and DL Holdings I, LLC (“DL Holdings,” and together with Weichert, the “Former Bridge Lenders”), dated as of January 14, 2003 (the “Agreement”), pursuant to which (i) the Former Bridge Lenders exchanged certain Eos notes payable and warrants to purchase shares of Eos common stock held by the Former Bridge Lenders for cash, shares of Eos Series D Preferred Stock (“Series D Preferred Stock”), and new warrants to purchase shares of Eos common stock, and (ii) Eos segregated $1.2 million (the “Redemption AccountFunds”) into an account selected with the approval of the Former Bridge Lenders, to be used solely for purposes specified in the Agreement as “Qualified Expenses” (“Qualified Expenses”). Section 3 of the Agreement provides that the Redemption Account Funds may only be used for paying Qualified Expenses or redeeming outstanding shares of Series D Preferred Stock, and that Qualified Expenses include, in addition to the other uses specified in Section 3, any expenditures upon which the parties mutually agree. Eos and each of the Former Bridge Lenders hereby agree that the expenditures set forth onSchedule A attached hereto (“Schedule A”) constitute Qualified Expenses and that Eos may use $225,000.00 of the Redemption Account Funds for the expenditures set forth onSchedule A. By countersigning this agreement where indicated below and returning it to Eos, each of the Former Bridge Lenders agrees to, and accepts, the terms of this agreement. |
Please indicate your confirmation of the foregoing by signing where indicated below and promptly returning this letter to Eos. |
| Sincerely, EOS INTERNATIONAL, INC. By: PETER A. LUND —————————————— Name: Peter A. Lund Title: Chairman |
| AGREED UPON AND ACCEPTED BY: WEICHERT ENTERPRISE LLC By: GERALD C. CROTTY —————————————— Name: Gerald C. Crotty Title: President |
DL HOLDINGS I, LLC By: MARC A. SCHWARTZ —————————————— Name: Marc A. Schwartz Title: Authorized Signatory |
Schedule A 2003 Update (8/31/03) Use of Proceeds Through October 31, 2003 (Eos Only) |
| 8/14/03 | 8/14 to 8/31/03 Activity | Carryover August | September | October | Total Carryover Aug.- Oct. 2003 | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Remaining Operating Funds | ||||||||||||||||||||
| Eos Chase Operating | 62 | -2 | 60 | |||||||||||||||||
| USB Paine Webber | 27 | 0 | 27 | |||||||||||||||||
| Total Operating Accounts | 89 | -2 | 87 | |||||||||||||||||
| Redemption Account | 988 | -32 | 956 | |||||||||||||||||
| Total Accounts | 1,077 | -34 | 1,043 | |||||||||||||||||
| Operating Expenses Payment Schedule | ||||||||||||||||||||
| From Operating Accounts | ||||||||||||||||||||
| Beginning Balance | 89 | 87 | 73 | 44 | ||||||||||||||||
| New York Staff Incl. Fringe | 6 | 0 | 12 | 12 | 24 | |||||||||||||||
| New York Office Rent | 20 | 0 | 10 | 10 | 20 | |||||||||||||||
| Other (Cobra Reimburse.) | -2 | 0 | -1 | -1 | -2 | |||||||||||||||
| Travel | 0 | 2 | 5 | 7 | ||||||||||||||||
| Regal Mgmt. Fee | -88 | -88 | ||||||||||||||||||
| Other | 4 | 14 | ** | 6 | 7 | 27 | ||||||||||||||
| Transfer from Restricted Account | -33 | 0 | ||||||||||||||||||
| Other Transfer to Payroll Account | 7 | 0 | ||||||||||||||||||
| Total Net Payments | 2 | 14 | 29 | -55 | -12 | |||||||||||||||
| Ending Balance | 87 | 73 | 44 | 99 | ||||||||||||||||
| From Redemption Account | ||||||||||||||||||||
| Beginning Balance | 988 | 956 | 843 | 726 | ||||||||||||||||
| Accounting Staff Incl. Fringe | 19 | 0 | 19 | 19 | 38 | |||||||||||||||
| CEO | 27 | * | 27 | |||||||||||||||||
| CFO | 19 | * | 19 | |||||||||||||||||
| Recruiting Fees | 0 | |||||||||||||||||||
| Interest Income | -1 | 0 | ||||||||||||||||||
| Investment Banking Expenses | 14 | 0 | 0 | |||||||||||||||||
| Total Approved | 32 | 0 | 19 | 65 | 84 | |||||||||||||||
| Legal Fees (Pitney) | 81 | 73 | 38 | 192 | ||||||||||||||||
| Legal Fees (Other) | 7 | 7 | ||||||||||||||||||
| Accounting Fees (BDO) | 32 | 20 | 52 | |||||||||||||||||
| Accounting Fees (Other) | 5 | 5 | ||||||||||||||||||
| Printing (Reg. Stmt.) | 20 | 20 | ||||||||||||||||||
| Total Other | 0 | 113 | 98 | 65 | 276 | |||||||||||||||
| Total Net Payments | 32 | 113 | 117 | 130 | 360 | |||||||||||||||
| Ending Balance | 956 | 843 | 726 | 596 | ||||||||||||||||
| Total Payments All Accounts | 34 | 127 | 146 | 75 | 348 | |||||||||||||||
| Ending Balance All Accounts | 1,043 | 916 | 770 | 695 | ||||||||||||||||
* Not Committed at This Time ** Greenbridge Payable |
