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EXHIBIT 4.2
FIRST AMENDMENT TO WARRANT AGREEMENT
This First Amendment to Warrant Agreement (the "First Amendment") is
made as of August 8, 2000, among Video Network Communications, Inc. (formerly,
Objective Communications, Inc.), a Delaware corporation with its offices at 00
Xxxxxxxxxxxxx Xxxxx, Xxxxxxxxxx, Xxx Xxxxxxxxx 00000 (the "Company"),
Continental Stock Transfer & Trust Company, a New York corporation with its
offices at 0 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Warrant Agent"), and
EarlyBirdCapital, Inc., a Delaware corporation with its offices at Xxx Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (formerly, Southeast Research Partners, Inc.
and referred to in this First Amendment as "EarlyBirdCapital" or the "Placement
Agent").
WHEREAS, the Company is engaged in a private placement of units (the
"Private Placement"), each unit ("Unit") consisting of one share of common stock
of the Company, par value $.01 per share (the "Common Stock") and one Redeemable
Common Stock Purchase Warrant to purchase one share of Common Stock;
WHEREAS, in the Offering, the Company proposes to issue and deliver up
to (i) 1,760,000 additional Redeemable Common Stock Purchase Warrants (the "New
Warrants") that are the same as the outstanding Public Warrants, (ii) an
aggregate of 264,000 Redeemable Common Stock Purchase Warrants to
EarlyBirdCapital or its designees upon exercise of the options to be issued to
them (the "Placement Agent's Warrants" and, together with the New Warrants, the
"Additional Warrants"), and (iii) extra warrants ("Extra Warrants") in an
indeterminate amount to be issued to subscribers and the Placement Agent (and
its designees) in an amount in accordance with the terms of an Agency Agreement
dated as of August 8, 2000 between the Company and the Placement Agent ("Agency
Agreement"), each of such Additional Warrants and Extra Warrants, if issued,
evidencing the right of the holder thereof to purchase one share of the
Company's Common Stock for an initial exercise price equivalent to the exercise
price of the public warrants of the Company currently trading on Nasdaq under
the symbol "VNCIW" ("Public Warrant"); and
WHEREAS, the Company and the Warrant Agent are parties to a Warrant
Agreement dated June 18, 1999 (the "Warrant Agreement"), pursuant to which the
Warrant Agent acts on behalf of the Company with respect to the issuance,
registration, transfer, exchange and exercise of the outstanding Warrants (as
defined in the Warrant Agreement); and
WHEREAS, the Additional Warrants are, and if issued the Extra Warrants
will be, the same as the Warrants covered by the Warrant Agreement, other than
the date of initial issuance; and
WHEREAS, the Company and the Warrant Agent wish to amend the Warrant
Agreement as set forth in this First Amendment to provide that the Additional
Warrants and the Extra Warrants, if issued, will be covered by the Warrant
Agreement and that the Warrant Agent will also act on behalf of the Company with
respect to the issuance, registration, transfer, exchange and exercise of the
Additional Warrants and the Extra Warrants, if issued;
WHEREAS, all acts and things have been done and performed that are
necessary to (i) make the Additional Warrants and the Extra Warrants, if issued,
when executed on behalf of the
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Company and countersigned by or on behalf of the Warrant Agent, as provided
herein, the valid, binding and legal obligations of the Company and to (ii)
authorize the execution and delivery of this First Amendment.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained, the parties hereto agree as follows:
1. Appointment of Warrant Agent for Additional Warrants; Definition
of "Warrants." The Company hereby appoints the Warrant Agent to act as the
Warrant Agent for the Additional Warrants and the Extra Warrants, if issued, and
the Warrant Agent hereby accepts such appointment and agrees to perform the same
in accordance with the terms and conditions set forth in the Warrant Agreement
and this First Amendment. The Company and the Warrant Agent hereby agree that
the Warrant Agreement shall be amended as of the date of this First Amendment to
include the Additional Warrants and the Extra Warrants, if issued. The defined
term "Warrants" in the Warrant Agreement shall be amended to include the
Additional Warrants and the Extra Warrants, if issued, and all references to
"Warrants" in the Warrant Agreement shall include, as of the date of this
Agreement, the Additional Warrants and, if issued, the Extra Warrants as of the
date such Extra Warrants are issued.
2. Warrants; Form and Exercise Period.
2.1 Form of Additional Warrants and Extra Warrants, if any. For
purposes of Section 2.1 of the Warrant Agreement, the registered form of each
certificate issued evidencing an Additional Warrant and Extra Warrants, if any,
shall be in substantially the same form as the Public Warrant.
2.2 Additional Warrants Not Detachable. The Warrant Agent
understands that the shares of Common Stock and the Additional Warrants that
comprise the units being issued in the Offering by the Company will be
separately certificated and that the Company will not issue any separate
certificates evidencing the units in the Offering. Accordingly, the provisions
of Section 2.5 of the Warrant Agreement shall have no force and effect with
respect to the Additional Warrants and Extra Warrants, if any.
2.3 Exercisability of Additional Warrants -- Six-Month Restriction.
Notwithstanding anything to the contrary contained herein, in the Warrant
Agreement or in the Certificate representing the Warrant, the Warrant Agent
understands that the Additional Warrants and Extra Warrants, if any, may not be
exercised until one day after the six-month anniversary of the closing of the
Offering ("Closing").
3. Redemption.
3.1 Limitation on Company's Right to Redeem Additional Warrants.
Notwithstanding contrary terms in the Warrant Agreement, the Warrant Agent
understands and acknowledges that the Company has agreed not to redeem the
Warrants (even if the conditions to redemption set forth in the Warrant
Agreement have been satisfied), without the prior written consent of
EarlyBirdCapital, which consent will not be withheld unreasonably, until (a) one
day following the six-month anniversary of the Closing of the Private Placement
and (b) the Additional War-
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rants and Extra Warrants, if any, and the shares of Common Stock included in the
Units, and underlying the Additional Warrants and Extra Warrants, if any, are
then the subject of an effective registration statement filed with the
Securities and Exchange Commission.
4. Warrant Agreement In Full Force and Effect. The Warrant Agent and
the Company acknowledge and agree that the provisions of the Warrant Agreement,
as amended by this First Amendment, remain in full force and effect.
5. Capitalized Terms. Capitalized terms used in this First Amendment
but not defined in this First Amendment shall have the meanings given such terms
in the Warrant Agreement.
IN WITNESS WHEREOF, this First Amendment has been duly executed by the
parties hereto under their respective corporate seals as of the day and year
first above written.
VIDEO NETWORK COMMUNICATIONS, INC.
Attest:
By:
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Name:
Title:
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
Attest:
By:
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Name:
Title:
EARLYBIRDCAPITAL, INC.
Attest:
By:
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Name:
Title:
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