Exhibit 10.40
                                  -------------



                                  AMENDMENT TO

                        AND ASSIGNMENT AND ASSUMPTION OF

                                LETTER AGREEMENT



         THIS AMENDMENT TO AND  ASSIGNMENT  AND  ASSUMPTION OF LETTER  AGREEMENT
(the  "Amendment and  Assignment")  is made effective as of July 2, 2002, by and
among CATEGORY 5 TECHNOLOGIES,  INC., a Nevada corporation (the "Company"),  SBI
E2-Capital USA Ltd. ("SBI E2"), and SBI-USA, LLC ("SBI-USA").

                                    RECITALS:

         WHEREAS,  by letter dated July 2, 2002,  the Company and SBI E2 entered
into that certain agreement,  a copy of which is attached hereto as Annex I (the
"Letter  Agreement"),  pursuant to which the  Company  engaged SBI E2 to provide
financial  services and a fairness opinion to the Company in connection with the
merger of the Company with and into MindArrow Acquisition Corp. (the "Merger").

         WHEREAS, the Company and SBI E2 desire to amend the Letter Agreement to
delete all references in the Letter  Agreement to the stock fee equal to 1/2% of
the transaction  value of the Merger,  as more fully set forth in this Amendment
and Assignment.

         WHEREAS,  SBI E2 desires to assign to SBI-USA,  and SBI-USA  desires to
assume,  all of  SBI  E2's  rights,  title  and  interest  in and to the  Letter
Agreement,  including but not limited to all  contractual  obligations of SBI E2
arising under the Letter Agreement.

         WHEREAS, the Company desires to consent to the assignment of all of SBI
E2's rights,  title and interest in and to the Letter Agreement to SBI-USA,  and
the  assumption by SBI-USA of all of SBI E2's  contractual  obligations  arising
thereunder.

         NOW, THEREFORE,  for good and valuable  consideration,  the receipt and
sufficiency of which are hereby acknowledged,  Company, SBI E2 and SBI-USA agree
as follows:

                                  1. Amendment

         (a) Amendment.  Section 5 of the Letter  Agreement is hereby deleted in
its entirety and replaced with the following provision:

         "5.  For our  services  in  connection  with  serving as  Advisor,  the
              Company shall pay, or cause to be paid, to SBI a cash fee equal to
              $175,000 in the following increments:

              a.     $25,000  in cash  upon  acceptance  and  execution  of this
                     agreement;
              b.     $50,000 in cash by July 15, 2002; and
              c.     $100,000  in cash  upon the  later of (i)  delivery  of the
                     fairness opinion and (ii) closing of the merger agreement."

         (b) No Other  Amendment.  Except as expressly  amended pursuant to this
Amendment and Assignment, the terms of the Letter Agreement shall remain in full
force and effect.

                                       1
<PAGE>

                          2. Assignment and Assumption

         (a)  Assignment  and  Assumption  of  Letter  Agreement.  SBI E2 hereby
transfers,  conveys and assigns to SBI-USA,  and SBI-USA hereby assumes,  all of
SBI E2's rights, title and interest in and to the Letter Agreement,  and SBI-USA
hereby  agrees to perform and fully  discharge all of SBI E2's  obligations  and
liabilities arising thereunder.

         (b) Defenses and Claims.  Nothing  contained  herein shall be deemed to
deprive  SBI-USA of any defenses,  setoffs,  or  counterclaims  which SBI E2 may
have,  had, or shall have with  respect to the Letter  Agreement  (collectively,
"Defenses and Claims"). SBI E2 hereby transfers,  conveys and assigns to SBI-USA
all Defenses and Claims.

         (c)  Consent  of  the  Company.  The  Company  hereby  consents  to the
assignment  of all of SBI E2's  rights,  title and interest in and to the Letter
Agreement to SBI-USA,  and the assumption by SBI-USA of all SBI E2's obligations
and liabilities arising thereunder,  pursuant to the terms of this Amendment and
Assignment.

                                3. Miscellaneous

         (a) Counterparts.  This Amendment and Assignment may be executed in one
or more counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same document.

         (b) Applicable Law. This Amendment and Assignment shall be governed by,
and  construed and  interpreted  in  accordance  with,  the laws of the State of
California, without giving effect to the conflict of laws rules thereof.

                           [Signature Page to Follow]


                                       2
<PAGE>


<PAGE>


         IN WITNESS WHEREOF,  the Company,  SBI E2 and SBI-USA have executed and
delivered  this  Amendment  and  Assignment  as of the day and year first  above
written.



                                         CATEGORY 5 TECHNOLOGIES, INC.
                                         a Nevada corporation


                                         /s/ Paul S. Anderson
                                         ---------------------------------------
                                         Name:  Paul S. Anderson
                                         ---------------------------------------
                                         Title:   CEO
                                         ---------------------------------------



                                         SBI E2-CAPITAL USA, LTD.


                                         /s/ Matthew McGovern
                                         ---------------------------------------
                                         Name:   Matthew McGovern
                                         ---------------------------------------
                                         Title:  Vice President
                                         ---------------------------------------



                                         SBI-USA, LLC


                                         /s/ Jon Buttles
                                         ---------------------------------------
                                         Name:   Jon Buttles
                                         ---------------------------------------
                                         Title:  Senior Vice President
                                         ---------------------------------------


                                       3
<PAGE>



                                     ANNEX I
                                     -------


                                Letter Agreement



                                       4
<PAGE>