EXHIBIT 4.10
SALIVA DIAGNOSTICS SYSTEMS, INC.
00000 XX 00XX XXXXXX
XXXXXXXXX, XX 00000
TEL: 360/000-0000
FAX: 360/000-0000
June 27, 1997
Tail Wind Fund Ltd.
Xxxxxx Xxxxxxx
c/o Xxxxxxx X. Xxxxx
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
This letter will confirm that, notwithstanding anything to the
contrary contained in that certain Convertible Securities Subscription Agreement
dated as of March 12, 1997 (the "Subscription Agreement") and that certain 7.5%
Convertible Debenture referenced in the Subscription Agreement (the
"Debenture"), the Tail Wind Fund Ltd. and Xxxxxx Xxxxxxx, on or prior to June
30, 1997, shall convert to common stock in one or more transactions a minimum of
$700,000 of principal amount of Debentures pursuant to the conversion terms and
conditions set forth in the Subscription Agreement and the Debenture (the "Early
Conversions"). The shares received upon the Early Conversions shall be defined
as the Early Conversion Shares. Each of you shall further be entitled to shares
of common stock of the Company in addition to the Early Conversion Shares if,
during any monthly period prior to January 1, 1998 designated in writing to us
(the "Designation Period"), the average daily low bid price for each day during
the Designation Period as reported by the Nasdaq Stock Market (the "Additional
Share Conversion Price") would be less than the Conversion Price, as defined in
the Debenture, attributable to such Early Conversions. The number of such
additional shares to be issued to you shall be the difference between (i) the
number of shares which would have been issued upon conversion of the Early
Conversion amount at the Additional Share Conversion Price, and (ii) the number
of Early Conversion Shares. All such additional shares have been registered as
provided in the Registration Rights Agreement described in the Subscription
Agreement, and the Company shall promptly file a post-effective amendment to its
Registration Statement (No. 333-26795) filed with the Securities and Exchange
Commission and declared effective on June 13, 1997, to reflect the Early
Conversions.
In consideration of the Company's agreement to issue the
additional shares as herein provided, each of you agrees not to sell, commit to
sell or otherwise transfer any of the Early Conversion Shares and additional
shares (collectively the "Early Conversion Shares")
Tail Wind Fund Ltd.
June 27, 1997
Page 2
except as follows: (a) up to one-third of the Early Conversion Shares at any
time from and after June 12, 1997; (b) up to an aggregate of two-thirds of the
Early Conversion Shares at any time from and after July 12, 1997, and (c) up to
an aggregate of 100% of the Early Conversion Shares at any time from and after
August 12, 1997; provided, however, that you may not sell, commit to sell or
otherwise transfer any Early Conversion Shares prior to the date on which the
post-effective amendment to the registration statement under which such shares
were registered has been declared effective by the Securities and Exchange
Commission.
The Company shall not, unless required by law, make any public
announcement of any 13D or similar filing made by the Tail Wind Fund Ltd.
Except as otherwise herein provided, all of the other terms
and provisions of the Letter Agreement, the Subscription Agreement and all
documents referenced therein shall remain in full force and effect.
If the foregoing correctly sets forth our understanding,
please execute this agreement in the lower left hand side whereupon it shall
become a binding agreement.
Sincerely,
Saliva Diagnostic Systems, Inc.
By: /s/ Xxxxxxx X. XxXxxxxxx
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Xxxxxxx X. XxXxxxxxx, President
Agreed and accepted:
The Tail Wind Fund Ltd.
By: /s/ Xxxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxxx Xxxxxxxx
/s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
