Exhibit 4.13.1
AMENDMENT AND AGREEMENT
This Amendment and Agreement (this "AMENDMENT"), dated as of April 29,
2005, is entered into by and between EPIXTAR CORP., a Florida corporation (the
"COMPANY"), and LAURUS MASTER FUND, LTD., a Cayman Islands company ("LAURUS"),
for the purpose of amending the terms of (i) the Secured Convertible Term Note,
dated May 14, 2004 (as amended, modified or supplemented from time to time, the
"TERM NOTE") issued by the Company to Laurus, (ii) the Common Stock Purchase
Warrant I, dated May 14, 2004 (as amended, modified or supplemented from time to
time, "WARRANT I") issued by the Company to Laurus, (iii) the Common Stock
Purchase Warrant II, dated May 14, 2004 (as amended, modified or supplemented
from time to time, "WARRANT II") issued by the Company to Laurus, (iv) the
Common Stock Purchase Warrant, dated August 27, 2004 (as amended, modified or
supplemented from time to time, "AUGUST 2004 WARRANT") issued by the Company to
Laurus, (v) the Common Stock Purchase Warrant, dated February 28, 2005 (as
amended, modified or supplemented from time to time, "FEBRUARY 2005 WARRANT"
and, together with Warrant I, Warrant II, the August 2004 Warrant and the
February 2005 Warrant, the "WARRANTS" and each, a "WARRANT") issued by the
Company to Laurus, (vi) the Securities Purchase Agreement, dated as of May 14,
2004, by and between the Company and Laurus (as amended, modified or
supplemented from time to time, the "PURCHASE AGREEMENT") and (vii) that certain
Registration Rights Agreement, dated as of May 28, 2004, by and between the
Company and Laurus (as amended, modified or supplemented from time to time, the
"REGISTRATION RIGHTS AGREEMENT"). Capitalized terms used herein without
definition shall have the meanings ascribed to such terms in the Term Note.
WHEREAS, the Company and Laurus have agreed to make certain changes to
the Term Note, the Warrants and the Registration Rights Agreement as set forth
herein;
NOW, THEREFORE, in consideration of the above, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Section 2.1(a) of the Term Note is hereby amended by deleting
the last sentence thereof and inserting the following new sentence in lieu
thereof:
"For purposes hereof, the "FIXED CONVERSION PRICE" means $1.00, subject
to further adjustment as set forth herein."
2. Laurus and the Company hereby agree that the "Exercise Price"
under and defined in each Warrant is hereby amended to mean $1.00, subject to
further adjustment after the date hereof as provided in each of said Warrants.
3. The Company hereby agrees to add to its pending Registration
Statement originally filed with the SEC on June 18, 2004 a sufficient number of
shares that would be convertible into Common Stock of the Company assuming the
full conversion of the Term Note (after giving effect to any adjustments to the
Fixed Conversion Price (as defined in the Term Note) made in accordance with
Section 1 of this Amendment) and the complete exercise of all Common Stock
Purchase Warrants issued to Laurus by the Company (after giving effect to any
adjustments to the exercise price set forth in such warrants made in accordance
with Section 2 of this Amendment. Any failure to so include such shares shall
constitute an "Event" as set forth in clause (i) of Section 2(b) of the
Registration Rights Agreement. Furthermore, the Company and Laurus hereby agree
that all Warrants shall be included with the definition of "Warrants" set forth
in the Registration Rights Agreement.
4. The Company and Laurus hereby agree that notwithstanding
anything to the contrary contained in Warrant II, the "Effective Date", under
and as defined in Warrant II, occurred on July 6, 2004.
5. The Company hereby represents and warrants to Laurus that (i)
each agency that the Company and its Subsidiaries (as defined in the Purchase
Agreement) utilize to bill accounts receivable owed to the Company and its
Subsidiaries and related to the Company and its subsidiaries' internet service
provider ("ISP") business ("ISP Accounts Receivable") are set forth on Schedule
I hereto (collectively, the "Existing Billing Agencies" and each, an "Existing
Billing Agency"), (ii) all ISP Accounts Receivable are collected by the Existing
Billing Agencies, and (iii) each Existing Billing Agency has been irrevocably
instructed by the Company and/or the applicable Subsidiary of the Company to
direct all ISP Accounts Receivable, and all reserves, holdbacks or similar
amounts (each a "Reserve" and collectively, the "Reserves") maintained by such
Existing Billing Agencies to the extent no longer required by such Existing
Billing Agencies, to the Reserve Restricted Account (as defined in the Reserve
Restricted Account referred to in Purchase Agreement).
6. The Company and the Amendment Subsidiaries (as defined below)
hereby assign all amounts collected in the Reserve Restricted Account to secure
the Obligations (as defined in each of the Master Security Agreement referred to
in the Purchase Agreement (as amended, modified or supplemented from time to
time, the "2004 Master Security Agreement") and the Master Security Agreement
referred to in the 2005 Purchase Agreement (as amended, modified or supplemented
from time to time, the "2005 Master Security Agreement")) owed to Laurus
(collectively, the "Laurus Obligations"), and the Company and the Amendment
Subsidiaries hereby agree that all such amounts shall be maintained in the
Reserve Restricted Account until such date (the "Work Station Date") as one
thousand (1,000) additional work stations have become Operational (as defined
below) in the call centers of Voxx Corporation and/or its Subsidiaries located
in the Phillippines. Upon the occurrence of the Work Station Date, so long as no
Event of Default has occurred and is continuing under, and as defined in, any of
(i) the Term Note, the Purchase Agreement or any Related Agreement referred to
in the Purchase Agreement or (ii) that certain Secured Term Note issued by the
Company and Voxx Corporation, a Florida corporation ("Voxx"), to Laurus on the
date hereof (as amended, modified or supplemented from time to time, the "2005
Term Note"), the Purchase Agreement referred to in the 2005 Term Note (as
amended, modified or supplemented from time to time, the "2005 Purchase
Agreement") or any Related Agreement referred to in the 2005 Purchase Agreement,
the amounts maintained in the Reserve Restricted Account shall be as promptly as
practicable distributed as follows (such date of distribution, the "Distribution
Date"): (i) 50% of such amounts shall be distributed to Laurus to repay the
Laurus Obligations in any order that Laurus may elect (without being subject to
a prepayment penalty referred to in Section 2.3 of the Term Note) and (ii) the
remainder of such amounts shall be distributed to the Company. Furthermore,
after the Distribution Date, the Company and the applicable Subsidiaries shall
instruct the Billing Agencies to deposit 50% of all ISP Accounts Receivable and
100% of all Reserves into the Reserve Restricted Account to be held as security
for the Laurus Obligations; provided that the Company and the Amendment
Subsidiaries hereby agree that Laurus may withdraw amounts from the Reserve
Restricted Account at any time to repay overdue amounts that are owed by the
Company or any of its Subsidiaries to Laurus. Furthermore, the Company and the
Amendment Subsidiaries hereby agree that, notwithstanding the foregoing, at any
time upon the occurrence and during the continuance of an Event of Default,
Laurus may withdraw amounts from the Reserve Restricted Account and apply such
amounts to repay the Laurus Obligations in accordance with the terms of each of
the aforementioned Master Security Agreements. For the purposes of this
Amendment, "Operational" shall mean, with respect to any individual work station
in a call center of Voxx Corporation and/or any of its Subsidiaries located in
the Phillippines, such work station is enabled to receive or make calls
consistent with the design and business intent of the call centers, in each case
in a manner reasonably satisfactory to Laurus
7. Notwithstanding anything to the contrary contained in the
Purchase Agreement, the Term Note or any Related Agreement referred to in the
Purchase Agreement, the Company hereby agrees that it shall not, and shall not
permit any of its Subsidiaries to, without the consent of Laurus, instruct or
agree with any Existing Billing Agency or, following the establishment thereof,
any Additional Billing Agency (as defined below), to (i) direct any proceeds of
any ISP Accounts Receivable or any Reserve to any location other than to the
Escrow Account or (ii) modify the calculation with respect to the amount of any
Reserve required to be returned to the Company or such Subsidiary, as the case
may be, and placed in the Escrow Account (or, in each case, the procedure
therefore). The Company agrees to notify, and cause its Subsidiaries to notify,
the Purchaser in the event that any of the Company or any of its Subsidiaries
intends to enter into a relationship with a billing agency other than the
Existing Billing Agencies (such billing agency, an "Additional Billing Agency"
and, together with the Existing Billing Agencies, the "Billing Agencies") to
collect ISP Accounts Receivable. In such an event, the Company hereby agrees to,
and to cause the applicable Subsidiary to, execute documentation in form and
substance satisfactory to Laurus, redirecting ISP Accounts Receivables and
Reserves maintained by such an Additional Billing Agency to the Escrow Account
(or such other deposit account agreed to by Laurus in writing) and have such
documentation acknowledged and agreed to by such Additional Billing Agency.
8. The Company, Voxx and Laurus hereby agree that, simultaneously
with the occurrence of an initial public offering of the common stock of Voxx,
Laurus shall have the option (but shall not be required) to convert all
outstanding Obligations (as defined in the 2004 Master Security Agreement) into
the common stock of Voxx at a conversion price equal to 70% of the price of the
common stock of Voxx offered in such an initial public offering.
9. The Company hereby agrees that any violation by the Company or
any of its Subsidiaries of any agreement made by the Company contained in this
Amendment, or any misrepresentation by the Company of any representation or
warranty contained in this Amendment shall, in each case, constitute an "Event
of Default" under, and as defined in, each of (i) the Term Note, the Purchase
Agreement, the Related Agreements referred to in the Purchase Agreement and (ii)
the 2005 Term Note, the 2005 Purchase Agreement and any Related Agreement
referred to in the 2005 Purchase Agreement.
10. Article IV of the Term Note is hereby amended by deleting
Section 4.12 thereof and inserting the following new Section 4.12 in lieu
thereof:
"4.12 2005 Note, Sands Documents and Related Agreements. An Event of
Default, under and as defined in any of (i) that certain Secured
Convertible Term Note, dated April __, 2005, issued by EPXR and Voxx
Corporation, a Florida corporation, to the Holder (as amended, modified
or supplemented from time to time, the "2005 Note"), (ii) the Purchase
Agreement referred to in the 2005 Note (as amended, modified or
supplemented from time to time, the "2005 Purchase Agreement"), (iii)
the Related Agreements referred to in the 2005 Purchase Agreement, (iv)
the Sands Securities Purchase Agreement (as defined in the 2005
Purchase Agreement) or (v) the Related Agreements referred to in the
Sands Securities Purchase Agreement, shall have occurred and be
continuing."
11. This Amendment shall be effective as of the date hereof
following the execution and delivery of same by each of the Company, each
Subsidiary of the Company set forth below (each, an "Amendment Subsidiary" and,
collectively, the "Amendment Subsidiaries") and Laurus.
12. Except as specifically set forth in this Amendment, there are
no other amendments to the Term Note, the Purchase Agreement, any Warrant or the
Registration Rights Agreement, and all of the other forms, terms and provisions
of such documents remain in full force and effect.
13. The Company hereby represents and warrants to Laurus that as
of the date hereof, after giving effect to this Amendment, (i) no Event of
Default has occurred and is continuing and (ii) all representations, warranties
and covenants made by Company and its Subsidiaries in connection with the Term
Note, the Purchase Agreement, the Warrants, the Registration Rights Agreement
and the Related Agreements referred to in the Purchase Agreement are true,
correct and complete and all of Company's and its Subsidiaries' covenant
requirements set forth in such documents have been met.
14. This Amendment shall be binding upon the parties hereto and
their respective successors and permitted assigns and shall inure to the benefit
of and be enforceable by each of the parties hereto and its successors and
permitted assigns. THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. This Amendment may be
executed in any number of counterparts, each of which shall be an original, but
all of which shall constitute one instrument.
* * * *
IN WITNESS WHEREOF, each of the Company, the Amendment Subsidiaries and
Laurus has caused this Amendment to be effective and signed in its name
effective as of the date set forth above.
EPIXTAR CORP.
By: /s/ Ilene Kaminsky
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Name: Ilene Kaminsky
Title: CEO
NOL GROUP, INC.
By: /s/ Deborah Gambone
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Name: Deborah Gambone
Title: Vice President
NATIONAL ONLINE SERVICES, INC.
By: /s/ Deborah Gambone
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Name: Deborah Gambone
Title: Vice President
LIBERTY ONLINE SERVICES, INC.
By: /s/ Deborah Gambone
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Name: Deborah Gambone
Title: Vice President
AMERIPAGES, INC.
By: /s/ Deborah Gambone
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Name: Deborah Gambone
Title: Vice President
B2B ADVANTAGE, INC.
By: /s/ Deborah Gambone
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Name: Deborah Gambone
Title: Vice President
EPIXTAR INTERNATIONAL CONTACT
CENTER GROUP, INC.
By: /s/ Ilene Kaminsky
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Name: Ilene Kaminsky
Title: CEO
VOXX CORPORATION
By: /s/ Ilene Kaminsky
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Name: Ilene Kaminsky
Title: CEO
EPIXTAR MARKETING CORP.
By: /s/ Ilene Kaminsky
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Name: Ilene Kaminsky
Title: CEO
LAURUS MASTER FUND, LTD.
By: /s/ Authorized Officer
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