Agreement, Waiver and Limited Release between BigString Corporation and Noteholders (November 30, 2007)

Summary

BigString Corporation and certain investors (the Releasors) agree to resolve issues arising from a previous subscription agreement. The Company will issue 1,000,000 unregistered shares of its common stock to the Releasors. In return, the Releasors waive and release any claims related to liquidated damages, additional securities, and certain closing conditions, but retain rights under the original purchased securities. The agreement also includes a covenant not to sue regarding these waived claims. The agreement is governed by New Jersey law.

EX-10.37 2 ex10-37.txt EXHIBIT 10.37 AGREEMENT, WAIVER AND LIMITED RELEASE THIS AGREEMENT, WAIVER AND LIMITED RELEASE (this "Agreement"), dated as of November 30, 2007, is by and among BigString Corporation, a Delaware corporation (the "Company"), and the parties identified on the signature pages hereto (each a "Releasor" and collectively the "Releasors"). WHEREAS, the Company and the Releasors previously entered into that certain Subscription Agreement, dated as of May 1, 2007 (the "Subscription Agreement"), pursuant to which the Releasors purchased convertible notes in the aggregate principal amount of $800,000 (the "Outstanding Convertible Notes"), which are convertible into shares of the Company's common stock, par value $0.0001 per share ("Common Stock"), and warrants to purchase up to 1,777,779 shares of Common Stock (collectively the "Purchased Securities"); WHEREAS, as provided for in the Subscription Agreement, the Releasors agreed to purchase additional convertible notes in the aggregate principal amount of $800,000 and warrants to purchase up to 1,777,779 shares of Common Stock (collectively, the "Additional Securities"), for a total subscription of $1,600,000, provided that the Company registered the shares of Common Stock underlying the Purchased Securities and the Additional Securities by September 13, 2007 and met certain other closing conditions (collectively, the "Second Closing Condition"); WHEREAS, the Company was unable to register the shares of Common Stock underlying the Purchased Securities and the Additional Securities by September 13, 2007, and, as a result, the Releasors did not purchase the Additional Securities; WHEREAS, under the terms of the Outstanding Convertible Notes, the Company is required to pay liquidated damages in the amount of $24,267 (the "Liquidated Damages") for the period following September 13, 2007 through November 13, 2007, the date on which the Company's registration statement (the "Registration Statement") registering the shares underlying the Purchased Securities, was declared effective by the Securities and Exchange Commission; and WHEREAS, the Company and the Releasors desire to set forth their agreement and understanding to date regarding the above referenced matters, including the issuance by the Company to the Releasors of 1,000,000 unregistered shares of the Company's Common Stock as more fully provided for herein. NOW, THEREFORE, in consideration of the mutual covenants and other agreements contained herein, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and the Releasors hereby agree as follows: 1. Payment of Consideration. The Company hereby grants to each Releasor ------------------------ the number of unregistered shares of Common Stock designated on the signature pages hereto (collectively, the "Shares"). The certificates representing the Shares will be issued in the names of the Releasors and shall contain a customary legend that the Shares represented by the certificates have not been registered under the Securities Act of 1933, as amended, and therefore are subject to certain transfer restrictions. Such legend will be substantially similar to the one contained in Section 4(h) of the Subscription Agreement. In consideration of the issuance of the Shares by the Company, the Releasors hereby covenant, agree and bind themselves unto the Company as set forth below. It is the understanding of the parties that the Company is under no duty, nor is it obligated, to register any of the Shares for the benefit of the Releasors. 2. Waiver and Limited Release. In consideration of the covenants and -------------------------- promises of the Company contained herein, each Releasor hereby waives, releases and gives up any and all direct and indirect present and future claims and rights which it may have against the Company, arising out of or related to the Liquidated Damages, the Additional Securities and the Second Closing Condition. This means that each Releasor waives, releases and gives up any and all claims and rights, including those of which it is not aware, which it may have against the Company as to the payment of the Liquidated Damages and purchase of the Additional Securities. The Company agrees that, notwithstanding the foregoing, the Releasors are not releasing or giving up any claims or rights they may have against the Company under any of the Purchased Securities or the Subscription Agreement as it relates to the Purchased Securities. The Releasors will not seek any further consideration from the Company for making this waiver and release of claims and rights, including, but not limited to, attorneys' fees or costs of suit. Each Releasor is bound by this waiver and release of claims and rights. Anyone who succeeds to the rights and responsibilities of any or all of the Releasors is also bound. 3. Covenant Not to Sue. Each Releasor acknowledges that this Agreement ------------------- is a legally binding document and that by signing it, each Releasor represents that it has not, will not, and cannot file, commence, assist in or maintain any arbitration, grievance, charge, or complaint or other proceeding with any governmental unit, administrative agency, or court of law or equity and any government institution against the Company relating to any matters involving the Company arising out of or related in any way to the Liquidated Damages, the Additional Securities and the Second Closing Condition. Each Releasor acknowledges that by agreeing to the terms and conditions of this Agreement, it is expressly and knowingly giving up its rights to pursue any and all claims it may have against the Company arising out of or related in any way to the Liquidated Damages, the Additional Securities and the Second Closing Condition, except for those claims and rights under any of the Purchased Securities or the Subscription Agreement as it relates to the Purchased Securities or relating to the enforcement of this Agreement. Each Releasor further agrees that no fact, evidence, event or transaction currently unknown to it but which hereinafter may become known to it shall affect in any way or manner the final and unconditional nature of this Agreement. 4. Releasor Representations and Warranties. As to the issuance and --------------------------------------- receipt of the Shares hereunder, each Releasor hereby reaffirms the representations and warranties made by it in Sections 4(d), (e), (f), (h), (l) and (m) of the Subscription Agreement. Such representations and warranties are incorporated herein by reference and, for purposes of this Agreement, are being made in connection with the Company's issuance of the Shares to the Releasors hereunder, and thereby should be read and construed to that effect. 5. Delivery of Unlegended Shares. As to the Shares, the Company agrees ----------------------------- to comply with the delivery requirements and related obligations set forth in Section 11.7 of the Subscription Agreement. 2 6. Choice of Law and Forum. The parties agree that this Agreement is ----------------------- made and entered into in the State of New Jersey and shall in all respects be interpreted, enforced and governed under the laws of the State of New Jersey, with regard to the conflict of laws principles thereof. The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any party. For purposes of any proceeding involving this Agreement or any of the obligations hereunder, the parties hereby submit to the exclusive jurisdiction of the courts of the State of New Jersey. 7. No Violation. This Agreement shall in no way be construed as an ------------ admission by any party of the violation of any law, regulation or prohibition or of any duty owed to any other party. 8. Construction. Wherever herein the singular number is used, the same ------------ shall include the plural, and the masculine gender shall include the feminine and neuter genders, and vice versa, as the context shall require. 9. Counterparts. This Agreement may be executed in two or more ------------ counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument. 10. Severability. Should any provision of this Agreement be declared or ------------ determined by any court of competent jurisdiction to be illegal or invalid, the validity of the remaining provisions shall not be affected and the illegal or invalid provisions shall be deemed not to be a part of this Agreement. 11. Entire Agreement. This Agreement contains the entire agreement and ---------------- understanding between the Parties with respect to the subject matter hereof and fully supersedes any and all prior agreements and understandings, written or oral, between the parties pertaining to such subject matter. 12. Section Headings. The section headings in this Agreement are ---------------- inserted only as a matter of convenience and reference and are not to be given any effect whatsoever in construing any provision of this Agreement. 13. Notices. Any notices, requests, demands and other communications ------- relating to this Agreement shall be in writing and shall be effective upon delivery to any party hereto either (a) in person, (b) by reputable overnight courier with charges prepaid, or (c) by certified or registered mail, postage prepaid. The addresses for any such communications shall be as follows: If to the Company: BigString Corporation 3 Harding Road Suite E Red Bank, New Jersey 07701 Attn: Darin M. Myman, President and Chief Executive Officer 3 With a copy to: Paul T. Colella, Esq. Giordano, Halleran & Ciesla, P.C. U.S. Postal Service Address: P.O. Box 190 Middletown, New Jersey 07748 or Hand Delivery and Overnight Service Address: 125 Half Mile Road Red Bank, New Jersey 07701 If to the Releasors: To the addresses indicated on the signature pages hereto With a copy to: Grushko & Mittman, P.C. 551 Fifth Avenue Suite 1601 New York, New York 10176. 14. Review. Each party has been advised to consult with an attorney ------ prior to executing this Agreement. Each party acknowledges and agrees that it has carefully considered this Agreement, that it is competent to execute this Agreement, that it has carefully read and fully understands this Agreement, and that it has executed this Agreement voluntarily and with full understanding of its terms and consequences. Each party further represents that any waiver or release of claims is given in return for consideration specified in this Agreement. This Agreement shall become enforceable and effective upon the complete execution of this Agreement by all parties hereto. [Signature Pages Follow.] 4 SIGNATURE PAGE TO AGREEMENT, WAIVER AND LIMITED RELEASE ------------------------------------------------------- Please acknowledge your acceptance of the foregoing Agreement, Waiver and Limited Release by signing and returning a copy to the undersigned whereupon it shall become a binding agreement between us. BIGSTRING CORPORATION a Delaware corporation By: /s/ Darin M. Myman ------------------------------------ Name: Darin M. Myman Title: President and Chief Executive Officer Dated: As of November 30, 2007 ----------------------------------------------------------- RELEASOR NUMBER OF UNREGISTERED SHARES OF COMMON STOCK ----------------------------------------------------------- ALPHA CAPITAL ANSTALT 312,500 Pradafant 7 9490 Furstentums Vaduz, Lichtenstein Fax: 011-42-32323196 /s/ Konrad Ackerman -------------------------------- (Signature) By: Konrad Ackerman ----------------------------------------------------------- SIGNATURE PAGE TO AGREEMENT, WAIVER AND LIMITED RELEASE ------------------------------------------------------- Please acknowledge your acceptance of the foregoing Agreement, Waiver and Limited Release by signing and returning a copy to the undersigned whereupon it shall become a binding agreement between us. BIGSTRING CORPORATION a Delaware corporation By: /s/ Darin M. Myman ------------------------------------ Name: Darin M. Myman Title: President and Chief Executive Officer Dated: As of November 30, 2007 ----------------------------------------------------------- RELEASOR NUMBER OF UNREGISTERED SHARES OF COMMON STOCK ----------------------------------------------------------- WHALEHAVEN CAPITAL FUND LIMITED 312,500 c/o FWS Capital Ltd. 3rd Floor, 14 Par-Laville Road Hamilton, Bermuda HM08 Fax: (441) 295-5262 /s/ Brian Mazzella -------------------------------- (Signature) By: Brian Mazzella, C.F.O. ----------------------------------------------------------- SIGNATURE PAGE TO AGREEMENT, WAIVER AND LIMITED RELEASE ------------------------------------------------------- Please acknowledge your acceptance of the foregoing Agreement, Waiver and Limited Release by signing and returning a copy to the undersigned whereupon it shall become a binding agreement between us. BIGSTRING CORPORATION a Delaware corporation By: /s/ Darin M. Myman ------------------------------------ Name: Darin M. Myman Title: President and Chief Executive Officer Dated: As of November 30, 2007 ----------------------------------------------------------- RELEASOR NUMBER OF UNREGISTERED SHARES OF COMMON STOCK ----------------------------------------------------------- CHESTNUT RIDGE PARTNERS LP 156,250 50 Tice Boulevard Woodcliff Lake, NJ 07677 Fax: (201) 802-9450 /s/ Kenneth Holz -------------------------------- (Signature) By: Kenneth Holz, C.F.O. ----------------------------------------------------------- SIGNATURE PAGE TO AGREEMENT, WAIVER AND LIMITED RELEASE ------------------------------------------------------- Please acknowledge your acceptance of the foregoing Agreement, Waiver and Limited Release by signing and returning a copy to the undersigned whereupon it shall become a binding agreement between us. BIGSTRING CORPORATION a Delaware corporation By: /s/ Darin M. Myman ------------------------------------ Name: Darin M. Myman Title: President and Chief Executive Officer Dated: As of November 30, 2007 ----------------------------------------------------------- RELEASOR NUMBER OF UNREGISTERED SHARES OF COMMON STOCK ----------------------------------------------------------- IROQUOIS MASTER FUND LTD. 156,250 c/o Iroquois Capital Management, LLC 641 Lexington Avenue, 26th Floor New York, NY 10022 Fax: (212) 207-3452 /s/ Joshua Silverman -------------------------------- (Signature) By: Joshua Silverman ----------------------------------------------------------- SIGNATURE PAGE TO AGREEMENT, WAIVER AND LIMITED RELEASE ------------------------------------------------------- Please acknowledge your acceptance of the foregoing Agreement, Waiver and Limited Release by signing and returning a copy to the undersigned whereupon it shall become a binding agreement between us. BIGSTRING CORPORATION a Delaware corporation By: /s/ Darin M. Myman ------------------------------------ Name: Darin M. Myman Title: President and Chief Executive Officer Dated: As of November 30, 2007 ----------------------------------------------------------- RELEASOR NUMBER OF UNREGISTERED SHARES OF COMMON STOCK ----------------------------------------------------------- PENN FOOTWEAR 62,500 Line and Grove Streets P.O. Box 87 Nanticoke, PA 18634 Attn: Jeff Davidowitz, President Fax: (570) 735-0251 /s/ Jeff Davidowitz -------------------------------- (Signature) By: Jeff Davidowitz, President -----------------------------------------------------------