MSTI Holdings, Inc.
Exhibit
10.4
000-000
Xxxxxx Xxxx
Xxxxxxxxx,
Xxx Xxxxxx 00000
September
6, 2007
To
the
Investors of Units:
Reference
is made to that certain Registration Rights Agreement dated May 24, 2007 (the
“Agreement”),
as
supplemented by the addendum thereto, dated as of May 24, 2007 (the
“Addendum”),
by
and among MSTI Holdings, Inc., a Delaware corporation (the “Company”),
and
each investor identified on the signature pages thereto (each, including its
successors and assigns, a “Investor”
and,
collectively, the “Investors”).
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Agreement.
Extension
of Effectiveness Date
Pursuant
to Section 1.2(a) of the Agreement, the Company must cause the Initial
Registration Statement to be declared effective by the Commission by the
Effectiveness Date. Pursuant to Section 1.2(b), if the Initial Registration
Statement is not declared effective by the Commission by the Effectiveness
Date,
on such Effectiveness Date and on each monthly anniversary of such Effectiveness
Date (if such Registration Statement has not been declared effective by the
Commission by such date) until such Registration Statement is declared effective
by the Commission, the Company shall pay to each Investor an amount in cash,
as
partial liquidated damages.
The
Company does not believe that it can cause the Initial Registration Statement
to
be declared effective by the Commission by the current Effectiveness Date.
The
undersigned Investors hereby grant the Company a one-time extension of the
Effectiveness Date for the Initial Registration Statement to November 21, 2007
(the “Extension
Date”).
Accordingly, the
undersigned Investors hereby waive any non-compliance with the aforementioned
Section 1.2(b) of the Agreement with respect to the Initial Registration
Statement, and waive any Default or Event of Default, and any breach or
threatened breach, arising under the Agreement or any Transaction Document,
including, without limitation, the Debentures and the Warrants, and waive any
and all penalties, damages, and claims, including, without limitation, any
and
all liquidated damages, resulting or that could result, as a result of the
Initial Registration Statement being declared effective on or before the
Extension Date and not being declared effective by the Effectiveness Date.
Notwithstanding the foregoing, in the event that the Initial Registration
Statement is not declared effective by the Extension Date, the Event Date for
purposes of Section 1.2(b)(iv) of the Agreement shall remain the Effectiveness
Date.
Waiver
of Other Provisions
Pursuant
to Section 1.2(b) of the Agreement, if prior to the effective date of a
Registration Statement, the Company fails to file a pre-effective amendment
and
otherwise respond in writing to comments made by the Commission in respect
of
such Registration Statement within 10 Trading Days after the receipt of comments
by or notice from the Commission that such amendment is required in order for
such Registration Statement to be declared effective, the Company shall pay
to
each Investor an amount in cash, as partial liquidated damages. Pursuant to
paragraph 5 of the Addendum, not less than 5 Trading Days prior to the filing
each such Registration Statement, the Company shall furnish to each Investor
copies of all documents proposed to be filed.
The
undersigned Investors hereby grant the Company a one-time waiver in order to
waive any non-compliance with the aforementioned Section 2(b) of the Agreement
and paragraph 5 of the Addendum with respect to comments made by the Commission
on August 21, 2007 (the “SEC
Comment Letter”)
and
waive any Default or Event of Default, and any breach or threatened breach,
arising under the Agreement or any Transaction Document, including, without
limitation, the Debentures and the Warrants, and waive any and all penalties,
damages, and claims, including, without limitation, any and all liquidated
damages, resulting or that could result, as a result of the Company’s failure to
file a pre-effective amendment within 10 Trading Days of receiving the SEC
Comment Letter and to furnish the Investors with copies of all such documents
proposed to be filed in response to the SEC Comment Letter 5 Trading Days prior
to filing such documents with the Commission.
The
Company hereby represents and warrants to the Investors that there is no other
Default or Event of Default under the Agreement except as described
herein.
Subject
to the waivers provided herein, the Agreement shall remain in full force and
effect. Except as expressly set forth herein, this letter agreement shall not
be
deemed to be a waiver, amendment or modification of any provisions of the
Agreement or of any right, power or remedy of the Investors, or constitute
a
waiver of any provision of the Agreement (except to the extent herein set
forth), or any other document, instrument and/or agreement executed or delivered
in connection therewith, in each case whether arising before or after the date
hereof or as a result of performance hereunder or thereunder. The Investor
reserves all rights, remedies, powers, or privileges available under the
Agreement, at law or otherwise. This letter agreement shall not constitute
a
novation or satisfaction and accord of the Agreement or any other document,
instrument and/or agreement executed or delivered in connection
therewith.
Except
as
expressly provided above, nothing contained in this letter or any other
communication between the Company and the Investors shall constitute a waiver
of
any past, present or future violation, Default or Event of Default of the
Company under the Agreement. Similarly, except as expressly set forth in this
letter agreement, the Investors hereby expressly reserve any rights, privileges
and remedies under the Agreement that it may have with respect to any violation,
Default or Event of Default.
The
Company hereby agrees and covenants that it will file a current report on Form
8-K with the Commission disclosing the material terms of this letter agreement
by 9:30 a.m. Eastern
time
on
the first Trading Day immediately following the execution of this letter
agreement by the Company and Investors holding a majority of the outstanding
Registrable Securities (the “Majority
Investors”).
Please
indicate your acknowledgment of and agreement to the foregoing by signing a
copy
of this letter and returning an executed original to the Company.
Pursuant
to Section 4.2 of the Agreement, this letter will become effective and binding
on all of the Investors upon execution of this letter agreement by the Majority
Investors. This letter agreement may be executed by the parties hereto in
counterparts, and execution may be evidenced by facsimile or other electronic
transmission of a signed signature page by any party hereto, and all of such
counterparts together shall constitute one and the same instrument.
Sincerely,
Xxxxx
Xxxxxxxxx
Chief
Executive Officer
ACCEPTED
AND AGREED:
“Investor”
_____________________________
[print
name above line]
Dated:_______________,
2007
By:_______________________________
Name:_____________________________
Title:
_____________________________
