EMAGIN CORPORATION
2070 ROUTE 52
HOPEWELL JUNCTION, NEW YORK 12533
March 1, 2004
To: The Parties Listed on the Signature Pages Attached Hereto
Reference is hereby made to the Master Amendment Agreement (the "Amendment
Agreement") entered into as of February 17, 2004 by and among eMagin
Corporation, a Delaware corporation (the "Company"), and each of the parties
listed on the attached signature page (unless identified specifically by name,
individually an "Investor", and collectively, the "Investors"). Capitalized
terms used and not otherwise defined herein that are defined in the Amendment
Agreement shall have the meanings given such terms in the Amendment Agreement.
In connection therewith, the Company and the Investors hereby agree to
amend and replace Section 2 of the Amendment Agreement in its entirety, as
follows:
"2. Issuance of the Warrants. In consideration of the
foregoing, eMagin will issue an aggregate of 2,500,000 common stock
purchase warrants to the Investors to be distributed on a pro-rata
basis as set forth in Schedule 3 attached hereto (the "Warrants"). The
Warrants shall have an exercise price equal to $2.76 per share of
Common Stock, which is 105% of the closing price of eMagin's Common
Stock on the day immediately preceding the Effective Date of this
Amendment Agreement. 1,500,000 of the Warrants will expire on the later
of (i) twelve months from the effective date of the Registration
Statement (as defined below in Section 3), and (ii) December 31, 2005.
In addition, the remaining 1,000,000 of the Warrants shall expire
forty-eight months after the effective date of the Registration
Statement, subject to adjustment as set forth in each warrant
agreement. The Warrants shall be substantially in the form attached to
this Amendment Agreement as Exhibit B."
In addition to the foregoing, the Investors hereby agree to convert the
accrued, but unpaid, interest on the Notes into shares of Common Stock at the
conversion price of $2.48 per share, the closing price of eMagin's Common Stock
on February 27, 2004.
This letter agreement shall be governed in all respects by the internal
laws of the State of New York as applied to agreements entered into among New
York residents to be performed entirely within New York, without regard to
principles of conflicts of law.
This letter agreement may be executed in any number of counterparts, each
of which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
Except as amended hereby, the terms and provisions of the Amendment
Agreement shall remain in full force and effect, and the Amendment Agreement is
in all respects ratified and confirmed. On and after the date of this letter
agreement, each reference in the Amendment Agreement to the "Agreement",
"hereinafter", "herein", "hereinafter", "hereunder", "hereof", or words of like
import shall mean and be a reference to the Amendment Agreement as amended by
this letter agreement.
This letter agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which taken together shall
constitute a single agreement.
Sincerely,
eMAGIN CORPORATION
By /s/ Gary Jones
---------------------------------------------
Name:Gary Jones
Title:CEO
VIRTUAL VISION, INC.
By /s/ K.C. Park
---------------------------------------------
Name:K.C. Park
Title: President
ORIGINAL SECURED PARTIES:
STILLWATER LLC
/s/ Mortimer D.A. Sackler
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Mortimer D.A. Sackler
President
Address: 15 East 62nd Street
New York, NY 10021
with a copy to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112
Attention: Stuart D. Baker, Esq.
Telecopy: (212) 541-5369
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GINOLA LIMITED
By:/s/J.G. White
-----------------------------------------------
Name:J.G. White
Title:Director
/s/Jack Rivkin
-----------------------------------------------
Jack Rivkin
Address:
NEW INVESTORS:
STILLWATER LLC
/s/ Mortimer D.A. Sackler
----------------------------------------------
Mortimer D.A. Sackler
President
Address: 15 East 62nd Street
New York, NY 10021
with a copy to:
Chadbourne & Parke LLP
30 Rockefeller Plaza
New York, New York 10112
Attention: Stuart D. Baker, Esq.
---------
Telecopy: (212) 541-5369
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GINOLA LIMITED
By: /s/ J.G. White
-----------------------------------------------
Name: J.G. White
Title: Director
/s/ Jack Rivkin
-----------------------------------------------
JACK RIVKIN
Address:
4
EMERALD ADVANTAGE FUND LP
By: /s/Joseph E. Besecker
-----------------------------------------------
Name: Joseph E. Besecker
Title: Managing Member
Address:
500 North Gulph Road
Suite 101
King of Prussia, Pa. 19406
EMERALD ADVANTAGE OFFSHORE FUND LTD
By: /s/Joseph E. Besecker
-----------------------------------------------
Name: Joseph E. Besecker
Title: Managing Member
Address:
500 North Gulph Road
Suite 101
King of Prussia, Pa. 19406
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EMERALD VENTURE CAPITAL I LP
By: /S/Joseph E. Besecker
-----------------------------------------------
Name: Joseph E. Besecker
Title: President
Address:
1703 Oregon Pike
Lancaster, PA. 17601
/s/ Robert N. Verratti
----------------------------------------------
Robert N. Verratti
Address:
13766 Sunset BLVD
Pacific Palisades, CA. 90272
/s/ George Haywood
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George Haywood
Address:
642 Second Street
Brooklyn, NY 11215
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