RE: Letter Agreement for additional consideration and addendums to Convertible Note (“Note Agreement”), Warrant (“Warrant Agreement”), and Registration Rights Agreements (“Reg Rights Agr”), (all three collectively, the “Investment Document”) with...
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October
6, 2007
RE:
Letter Agreement for additional consideration and addendums to Convertible
Note
(“Note Agreement”), Warrant (“Warrant Agreement”), and Registration Rights
Agreements (“Reg Rights Agr”), (all three collectively, the “Investment
Document”) with Future Now, Inc. (the “Company”)
We
are
pleased to inform you that we are in the final stages of our transaction whereby
the Company will effectively merge into Future Now Group, Inc (“FNGI”), a fully
reporting public entity, traded on the NASDAQ Over the Counter Bulletin Board
under the symbol FUTR (the “Transaction”). This Transaction will provide the
Company access to the public capital markets to accelerate its business
expansion and financing plans. Following the closing of the Transaction, the
Company and its management will take over control of FNGI. Furthermore, on
or
about the closing date of the Transaction, FNGI is expected to close on
additional funding which we anticipate will provide FNGI with approximately
$1
million in capital, net of fees, including, but not limited to, commissions,
placement and legal fees (the “New Financing”)
The
Transaction or the New Financing do not qualify as a redemption event as
provided for under Section 2(b) of your Note Agreement, which states; “the Notes
shall be redeemed at the earlier of (i) three years from issuance date, or;
(ii)
the date upon which the Company completes the sale of Common Stock (or like
security, including convertible debt instruments) for aggregate proceeds of
at
least $2,500,000 (“Qualified Financing”), or; (iii) the closing of a material
acquisition of the Company and Change of Control, as defined, whether by merger,
recapitalization, sale of assets or other similar material transaction
(“Acquisition”). Change of Control shall mean the sale and/or transfer of in
excess of 50% of then outstanding voting stock of the Company.” However, please
note that this New Financing will be credited toward the aggregate proceed
calculation for a Qualified Financing that would trigger Note
repayment.
To
facilitate with the closing of the New Financing and the success of the
Transaction, please acknowledge your agreement to the following addendums (the
“Addendums”). THESE
ADDENDUMS ONLY RELATE TO THE TRASACTION DISCUSSED HEREIN AND IF NO CLOSING
SHOULD OCCUR THIS LETTER AGREEMENT WILL BECOME NULL AND
VOID.
| a) |
To
Note Agreement - Section 2(2) will be amended as follows; ““Conversion
Price” means the lower of the (i) price per share in a Qualified Financing
or Acquisition, at a 20% discount, or (ii) the five (5) day average
closing price of FNGI stock from the day of Closing, or (iii) the
conversion price of the convertible note as provided for in with
the New
Financing, at a 20% discount.”
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| b) |
To
the Warrant Agreement - Section 1(b) will be amended as follows;
“Subject
to the adjustments contained in Paragraph 8, the “Exercise Price” per
Warrant Share shall be at the lower of the (i) exercise price granted
for
any warrant issued as part of the New Financing, or (ii) the five
(5)
trading day average closing price of FNGI stock from the day of
Closing.”
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“Persuading
Customers When They Ignore Marketing”
000
Xxxxxxx Xxxxxx, 0xx
Xxx, Xxxxxxxx, XX 00000
Phone:
(000) 000-0000 • Fax: (000) 000-0000
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| c) |
To
the Registration Rights Agreement - Section 1(a) will be amended
as
follows; “The Holders agree to amended their piggyback registration rights
such that they allow for any required registration provisions applicable
to the New Financing to be first
met.
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As
consideration (the “Consideration”) for your agreement to the above Addendums,
you will receive: Additional
warrant certificates equal to 100% of the current warrants presently in your
possession priced at the same discounted terms as described in item (a)
above.
Please
note that all other terms and conditions of your Investment Documents will
remain the same including the Note Redemption Feature which calls for the
automatic redemption of the Notes in an amount applied which represents three
and one-half percent (3.5%) of the Company’s gross revenue. Some of you have
received your first six month interest coupon with others based upon investment
date will be receiving theirs shortly.
As
we are
in the process of gathering all closing documents, please sign below and return
in the self-addressed express mail envelope enclosed. Please feel free to
contact Xxxxxxx X. Xxxxxxx, our Chief Financial Officer or myself with any
questions. We look forward to closing this Transaction and continuing to
maximize our shareholders value. As required per the Investment Document you
will receive new Investment Documents reflecting the above Addendums and
Consideration. For your reference we have also attached hereto the Consolidated
Audited Financial Statements for the Company as of December 31, 2005 and
2006.
If
you
have any further questions on this, please also note that we will be having
a
general conference call with our current investors on Thursday, October 11,
2007
at 11:00 eastern standard time. To attend this discussions please follow the
instructions below:
| Call into: | 000-000-0000 | ||||||
| When prompted code | |||||||
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In
the following:
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12342154# |
We
appreciate your continued support and look forward to much success in the
future.
Sincerely,
Xxxxxxx
Xxxxxxxxx
Chief
Executive Officer
“Persuading
Customers When They Ignore Marketing”
000
Xxxxxxx Xxxxxx, 0xx
Xxx, Xxxxxxxx, XX 00000
Phone:
(000) 000-0000 • Fax: (000) 000-0000
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As
acknowledged and agreed to as of the date first provided above,
Specific
Investment Document References:
10.5%
Convertible Promissory Note, Face Amount $____ dated ____, 2007
Warrant
Agreement and Warrant Certificate #__ both dated _____ , 2007
Registration
Rights Agreement dated _______, 2007
By:
the
Registered Holder or Authorized Party
to
the
Investment Documents Referenced Above
“Persuading
Customers When They Ignore Marketing”
000
Xxxxxxx Xxxxxx, 0xx
Xxx, Xxxxxxxx, XX 00000
Phone:
(000) 000-0000 • Fax: (000) 000-0000
