Exhibit 10.3
August 31, 2010
The Cellular Connection, Ltd
XX Xxx 000
Xxxxxxxx Xxxx, Xxxxxxx
X0X 0X0
Re: Side Letter Agreement regarding the Convertible Secured Promissory Note
by and between Vital Products, Inc. (hereinafter the "Company") and you
Dear Sirs:
This Side Letter Agreement ("Agreement") entered into on the date of this
letter, by and between the Company and you will serve to amend and add certain
terms to the Convertible Secured Promissory Note issued by Vital Products, Inc.
on April 30, 2009 (the "Note"). Capitalized terms used herein which are not
otherwise defined shall have the same meaning as those given to them in the
Note.
For good and valuable consideration, both parties agree that the Note will be
amended as follows:
Face Amount of the Note
As of August 31, 2010, the Face Amount of the Note became U.S. $29,545.52
Article 5.2 Conversion Privilege
The text under subsection (c) of Article 5.2 will be removed and replaced with
the following:
(c) Conversion Rate - The Conversion Price for the Note shall be set at $0.0001
and shall be subject to adjustment as follows:
(i) If the Company, at any time while this Note is
outstanding: (i) subdivides outstanding shares of Common
Stock into a larger number of shares, (ii) combines
(including by way of reverse stock split) outstanding
shares of Common Stock into a smaller number of shares,
or (iii) issues by reclassification of shares of the
Common Stock any shares of capital stock of the Company,
then in each case the Conversion Price shall be
multiplied by a fraction of which the numerator shall
be the number of shares of Common Stock (excluding
treasury shares, if any) outstanding immediately before
such event and of which the denominator shall be the
number of shares of Common Stock outstanding immediately
after such event. Any adjustment made pursuant to this
Article 5.3(c)(i) shall become effective immediately
after the record date for the determination of
stockholders entitled to receive such dividend or
distribution and shall become effective immediately
after the effective date in the case of a subdivision,
combination or re classification. For purposes of
clarity, the reverse split on August 27, 2010 will not
affect the conversion rate.
(ii) The Company shall not amend its Articles of Incorporation
(as amended from time to time), its By-laws or
participate in any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action for the purpose
of avoiding or seeking to avoid the observance or
performance of any of the terms of this Note to be
observed or performed by the Company, including without
limitation this Article 5.3(c), but shall at all times
in good faith assist in carrying out all such action as
may be reasonably necessary or appropriate in order to
protect the rights of the Investor against dilution or
other impairment as provided herein.
(iii) All calculations under this Article 5.3(c) shall be
made to the nearest cent.
(iv) The Company shall not be required upon the exercise of
this Note to issue any fractional shares.
No other terms, rights or provisions of the Note should be considered to have
been modified by the terms of this Agreement and each party retains all other
rights, obligations, privileges and duties contained in the Note.
Sincerely,
/s/Xxxxxxx Xxxxxx
-------------------
Xxxxxxx Xxxxxx
AGREED AND ACCEPTED:
Signature: /s/Xxxxxx Xxxx
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Printed Name: Xxxxxx Xxxx
Date: August 31, 2010
