Re: Amendment to December 2007 Subscription Agreement
November
20, 2008
Re:
Amendment to December 2007 Subscription Agreement
Dear
Investor:
Purple
Beverage Company, Inc. (the “Company”) has been offered the opportunity to
receive financing from a third party lender pursuant to which the Company shall
issue and sell to the lender one or more debentures at a conversion price that
will be set at a 20% discount to market. Subject to certain conditions and
at
the option of the lender, the Company may raise up to a maximum aggregate amount
of $6,000,000 in connection with this financing, in four tranches of up to
$1.5
million each, with a minimum of $250,000 to be advanced at the initial closing.
Although the Company is currently negotiating definitive documents with the
lender, there can be no assurance that this financing will be
consummated.
In
addition, the Company has been offered, and in the future may be offered, other
opportunities to receive financings that would involve issuing a security priced
at market or at a discount to market. Such financings are imperative to the
Company’s ongoing survival but are prohibitive due to restrictions and
provisions that would trigger substantial anti-dilution adjustments set forth
in
our December 2007 Subscription Agreement, as amended.
Therefore,
we are writing to obtain your consent to eliminate certain restrictions set
forth in the December 2007 Subscription Agreements, as amended, that preclude
the issuances of variable priced equity linked instruments (which restrictions
are set to expire on December 12, 2008) and certain provisions set forth in
our
December 2007 Subscription Agreement, as amended, that would trigger substantial
anti-dilution adjustments in the event that such instruments are priced at
below
the $0.10 per share (which adjustments are set to expire on June 12, 2009)
with
respect to financings consummated on or prior to January 31, 2009.
Accordingly,
by executing this consent and amendment in the space provided below, you hereby
agree that all restrictive covenants (including, without limitation, Section
9(r)) and all most favored nation price protection features applicable to shares
and warrants (including, without limitation, Section 12) set forth in the
Subscription Agreement, as amended, are hereby eliminated in connection with
any
financings to be consummated by the Company on or prior to January 31, 2009
whereby the Company issues securities at a price below $0.10 per share, or
issues securities priced at market or at a discount to market.
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Best
regards,
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/s/
Xxxxxxxx Xxxxxxxxxx
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Xxxxxxxx
Xxxxxxxxxx
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Chief
Executive Officer
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Please
return signed letter to Xxxxxxx Xxxxxxxxx - Fax 000.000.0000, or
xxxxxxxxxx@xxxxxxxxxxxxxxxx.xxx
Stockholder’s
Name: _____________________ Signature: _______________________ Date:
________
000
X Xxx
Xxxx Xxxxxxxxx, Xxxxx 000 x Xx. Xxxxxxxxxx, Xxxxxxx 00000 ∙ P:
954.462.8382
xxx.XxxxxXxxxxx.xxx
