WAIVER AND AGREEMENT
Exhibit
10.38
A. IQ
Micro
Inc., a Colorado corporation (“IQ Micro”), entered into (i) a Second Amended and
Restated Investor Registration Rights Agreement (the “2006 Agreement”) with
Cornell Capital Partners, L.P. (“Cornell”) dated March 29, 2006 and (ii) a
Registration Rights Agreement dated February 15, 2007 (the “2007 Agreement”)
(the 2006 Agreement and the 2007 Agreement are collectively referred to herein
as the “Agreements”).
B. Section
2(a) of the 2006 Agreement requires IQ Micro to file a registration statement
(the “2006 Registration Statement”) with the Securities and Exchange Commission
(“SEC”) no later than 90 days after the date of the 2006 Agreement.
C. IQ
Micro
and Cornell have entered into three waivers with respect to the 2006 Agreement
and the 2006 Registration Statement (dated, respectively, June 26, 2006, October
5, 2006, and January 8, 2007 and collectively referred to herein as the “2006
Waivers”) pursuant to which the deadline for the filing of the 2006 Registration
was extended to February 28, 2007.
D. Section
2(a) of the 2007 Agreement requires IQ Micro to file a registration statement
(the “2007 Registration Statement”) with the SEC on or prior to the
30th
calendar
day following the date that Cornell delivers written notice requesting IQ Micro
to file the 2007 Registration Statement.
E. IQ
Micro
and Cornell hereby agree that it is in all parties’ best interests (i) to hereby
amend the 2006 Agreement and the 2007 Agreement so that all the Registrable
Securities (as defined in the Agreements) shall hereafter be covered by the
2007
Agreement alone and so that the 2006 Agreement shall be terminated hereby as
of
the date hereof, (ii) to hereby agree and provide that all the securities that
would have been included in the 2006 Registration Statement governed by the
2006
Agreement shall be included in one registration statement which shall be the
2007 Registration Statement governed by the 2007 Agreement, (iii) to hereby
amend the deadline for IQ Micro’s filing of the 2007 Registration Statement, and
hereby amend the 2007 Agreement, so that IQ Micro shall file the 2007
Registration Statement pursuant to the demand registration right provided for
in
the 2007 Agreement on or prior to the 45th
calendar
day following the date that Cornell delivers written notice requesting IQ Micro
to file the 2007 Registration Statement.
X. Xxxxxxx
hereby (i) waives the requirement contained in Section 2(a) of the 2006
Agreement, as modified by the 2006 Waivers, that IQ Micro file the 2006
Registration Statement no later than February 28, 2007, (ii) authorizes, agrees
and consents that IQ Micro will now be required to file the 2007 Registration
Statement with the SEC on or before the 45th
calendar
day following the date that Cornell delivers written notice requesting IQ Micro
to file the 2007 Registration Statement, (iii) covenants and agrees not to
exercise any rights or privileges that would be or would have been available
to
it under the 2006 Agreement and/or the 2007 Agreement if the original 2006
Registration Statement filing deadline had not been modified as contemplated
herein; (iv) covenants and agrees that the effective date of the waiver of
the
deadline granted to IQ Micro in this document shall be the date of execution
hereof as set forth below and (v) agrees hereby to all the other terms set
forth
herein.
G. IQ
Micro
and Cornell hereby confirm that each party has no claims against the other
party
for default under the Agreements and that the parties hereby waive and release
any and all default-related liquidated damages, penalty interest, late fees
and
other penalties of any kind in connection with the Agreements through and
including the date hereof.
H. All
other
rights and obligations of the parties contained in the 2007 Agreement shall
remain in full force and effect in accordance with their terms.
I. Each
party hereby accepts, approves and covenants and agrees to be bound by the
terms
and conditions of this Waiver and Agreement.
J. IQ
Micro
and Cornell represent and warrant to each other that the officer who signs
this
Waiver and Agreement on their behalf is duly authorized and empowered to do
so
by all required action.
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CORNELL
CAPITAL PARTNERS, L.P.
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By:
Yorkville Advisors, LLC
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Its:
General Partner
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By:
/s/ Xxxx
Xxxxxx
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Name:
Xxxx
Xxxxxx
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Title:
Portfolio
Manager
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| Date: May 21, 2007 |
AGREED
TO AND ACCEPTED:
By:
/s/
Xxxxxx X.
Xxxxxx
Xxxxxx X. Xxxxxx
Chief Financial Officer
Date:
May
21, 2007
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