Exhibit 10.4
EXECUTION
WAIVER LETTER NO.
2
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Dated as of
September 8, 2009
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To Prides Capital Fund I, L.P.,
LLC
as purchaser
(the “ Purchaser ”)
under the
Note and Warrant Purchase
Agreements
referred to below
Ladies and Gentlemen:
We refer to the following
agreements: (i) the Note and Warrant Purchase Agreement dated
as of August 31, 2007 between eDiets.com, Inc. (the “
Company ”) and the Purchaser (the “ August
2007 Note and Warrant Purchase Agreement ”);
(ii) the Note and Warrant Purchase Agreement dated as of
May 30, 2008 between the Company and the Purchaser (the
“ May 2008 Note and Warrant Purchase Agreement ”
and together with the August 2007 Note and Warrant Purchase
Agreement, the “ Note and Warrant Purchase Agreements
”); (iii) the Senior Secured Note dated as of
May 30, 2008 (the “ May 2008 Note ”) in the
original principal amount of $2,595,000 issued by the Company to
the Purchaser; and (iv) the Senior Secured Note dated as of
November 13, 2008 (the “ November 2008 Note
” and together with the May 2008 Note, the “
Notes ”) in the original principal amount of
$2,550,000 issued by the Company to the Purchaser (the Note and
Warrant Purchase Agreements and the Notes being referred to
collectively herein as the “ Purchase Documents
”). Capitalized terms not otherwise defined in this Waiver
Letter No. 2 have the same meanings as specified in the May
2008 Note and Warrant Purchase Agreement.
Section 4 of the Note and
Warrant Purchase Agreements provide in part that, except as
otherwise consented to or waived by the Majority Holders, the
Company will not (and will not permit any of its Subsidiaries to),
for so long as any amount due under any Note is
outstanding:
4.2 Enter into any transaction with
any person or entity that is affiliated with, controls or is
controlled by, the Company, except for transactions in the ordinary
course of business and on terms not less favorable to the Company
than it would obtain in a transaction between unrelated
parties.
Section 1.3 of the Notes
provides as follows:
1.3 Mandatory Prepayment .
Not later than 15 days after the closing of any public or private
sale by the Company of its equity except for Exempt Sales (as
defined below), the Company shall prepay 100% of the outstanding
Notes plus any accrued and unpaid interest to the date of such
prepayment, provided , however, that (i) if any such
prepayment is made on or before June 30, 2009, such prepayment
shall include a prepayment premium of 5% of the prepaid amount, and
(ii) if any such prepayment is made after June 30, 2009
and on or before June 30, 2010, such prepayment shall include
a prepayment premium of 3% of the prepaid
EXECUTION
amount, and provided , further ,
that any such prepayment made pursuant to subclause (i) or
(ii) of this Section 1.3 shall include accrued interest
on the amount so prepaid. For the purposes of this
Section 1.3, “Exempt Sales” shall mean the
issuance of shares of Common Stock and/or options, warrants or
other Common Stock purchase rights and the Common Stock issued
pursuant to such options, warrants or other rights (as adjusted for
any stock dividends, combinations, splits, recapitalizations and
the like after the date hereof) issued or to be issued after the
date hereof (i)&nbs
