Exhibit 10.4
 
February ___, 2012
 
Castlerigg Master Investments Ltd.
c/o Sandell Asset Management
40 West 57th Street, 26th Floor
New York, New York 10019

Ladies and Gentlemen:
 
Reference is hereby made to that certain (a) Loan Restructuring Agreement, dated
December 16, 2010, (the “Loan Agreement”), among Broadcast International Inc., a
Utah corporation (“Borrower”) and Castlerigg Master Investments Ltd. (“Lender”),
and (b) the other Transaction Documents, as defined in the Loan Agreement
(collectively, the “Debt Documents”).
 
Lender hereby certifies to Borrower that Lender (i) is the legal and beneficial
holder of any and all promissory notes and other instruments that evidence the
loans or other advances made pursuant to the Debt Documents, and (ii) has all
requisite power and authority to deliver this letter.
 
In exchange for $2,750,000 (the “Payoff Amount”) and the receipt of 2,000,000
shares of restricted common stock of the Borrower (the “Shares”), Lender hereby
agrees to (a) terminate the Debt Documents and all of the commitments of the
parties thereunder, and (b) to accept the Payoff Amount and the Shares as
satisfaction and accord for all obligations of the Borrower under the Debt
Documents (the “Obligation”).
 
Lender hereby further certifies and confirms to Borrower and Buyer that, upon
satisfaction of all of the Payoff Conditions (as defined below), the following
shall occur without further action by Borrower, Lender or any other person or
entity:
 
(a)           the Obligations shall be deemed to have been paid and performed in
full, each of the Debt Documents shall terminate, and Borrowers and all other
persons and entities obligated therefor, whether by guaranty, pledge of property
or otherwise, shall be released and discharged from any and all liability,
obligations, covenants and agreements under the Debt Documents, including,
without limitation, any further obligation to make any other payments of any
kind under the other Debt Documents; and
 
(b)           all liens and other security interests or security titles granted
in favor of Lender in any and all real or personal property, or other tangible
or intangible assets of Borrower or any other person or entity (the “Property”)
pursuant to the Debt Documents shall automatically terminate and be released.
 
The parties hereto hereby further agree that, upon satisfaction of all of the
Payoff Conditions (as defined below): (i) Borrower and its designees shall be
authorized to prepare and file Uniform Commercial Code termination statements
with respect to all financing statements filed in connection with the Debt
Documents and such other documents as may be reasonably required to terminate
Lender’s liens upon any Property; and (ii) Lender shall execute and deliver to
Borrower or its designees, at Borrower’s sole cost and expense, such other or
further documents or instruments as Borrower or its designees may reasonably
request to effect or otherwise evidence the satisfaction of the Obligations and
the release of all liens, security interests, assignments, pledges and other
interests Lender may have in the assets of Borrower or any other person or
entity pursuant to the Debt Documents.
 
 
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As used in this letter agreement, the “Payoff Conditions” shall mean all of the
following conditions precedent:
 
(a)           Lender’s receipt of the Payoff Amount, in immediately available
funds;
 
(b)           Lender’s delivery of all promissory notes, guarantees or other
evidences of indebtedness pursuant to the Debt Documents to U.S. Bank National
Association, Attn:  Georgina Thomas, 633 W. 5th Street, 24th Floor, Los Angeles,
CA 90071 (the “Escrow Agent”); and
 
(c)           executed counterparts of this letter agreement from each of the
parties hereto will be delivered to the Escrow Agent.
 
The Payoff Amount shall be wire transferred to the following account:
 
[________Bank _______]
ABA:  ___________
Acct:   ___________
Attn:  ____________
REF:  ____________
 
Upon notification by the Borrower, the Escrow Agent will wire the money to the
Lender, and will deliver the promissory notes, guarantees or other evidences of
indebtedness to the Borrower.  Within five (5) business days of the date the
money is transferred to the Lender, Borrower will deliver a certificate
evidencing the Shares to the Lender.
 
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This letter agreement may be executed in counterparts and be delivered by
facsimile or other electronic transmission.  This shall constitute an agreement
made in, and governed by, the internal laws of the State of Utah.
 
 

 
Very truly yours,
         
BROADCAST INTERNATIONAL, INC.
                 
 
By:
      Name:          Title:             

 
 

 
Acknowledged and agreed:
 
 
CASTLERIGG MASTER INVESTMENTS LTD.
 

 
By:
    Name:        Title:           

 
 
 
 
                                              

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