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EXHIBIT AB
PHOENIX INFORMATION SYSTEMS CORP.
February 12, 1996
S-C Phoenix Partners
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Additional Warrant
Gentlemen:
Reference is made to the Convertible Note Purchase Agreement
(as amended, "Agreement") dated December 9, 1994 between the undersigned
("Company") and you ("S-C Partners"), as most recently amended by letter
agreement dated September 15, 1995 ("September Letter"). Capitalized terms are
used herein as defined in the Agreement and September Letter. Pursuant to the
September Letter, the Company agreed to issue to S-C Partners Additional
Warrants, and to adjust the Conversion Price of the Tranche D Note converted
pursuant to the September Letter, in the event that a certain event or events
did not occur by January 15, 1996.
The parties wish to modify the September Letter as follows:
1. The Company will issue the Additional Warrants, the
exercise price for which shall be $3.23 per share, pursuant to the Warrant
Agreement annexed hereto as Exhibit A.
2. The Conversion Price for the Tranche D Note issued
and converted pursuant to the September Letter shall be deemed to have been
$.80 per share and the Company shall issue an additional 300,000 shares
("Adjusted Conversion Shares") to S-C Partners to reflect such adjustment.
3. S-C Partners hereby represents and warrants as
follows:
(a) The Adjusted Conversion Shares and the
Additional Warrants ("Securities") being acquired by S-C
Partners are being acquired for investment for its own account
and not with the view to, or for resale in connection with,
any distribution or public offering thereof. S-C Partners
understands that such Securities have not been registered under
the Securities Act of 1933, as amended (the "Securities Act")
or any state securities laws by reason of their contemplated
issu-
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ance in transactions exempt from the registration requirements
of the Securities Act pursuant to Section 4(2) thereof and
applicable state securities laws, and that the reliance of the
Company and others upon these exemptions is predicated in part
upon this representation by S-C Partners. S-C Partners further
understands that such Securities may not be transferred or
resold without (i) registration under the Securities Act and
any applicable state securities laws, or (ii) an exemption from
the requirements of the Securities Act and applicable state
securities laws.
(b) S-C Partners understands that an exemption
from such registration is not presently available pursuant to
Rule 144 promulgated under the Securities Act by the
Securities and Exchange Commission (the "Commission") and
that, in any event, S-C Partners may not sell any such
Securities pursuant to Rule 144 prior to the expiration of a
two-year period after it has acquired such Securities. S-C
Partners understands that any sales pursuant to Rule 144 can
be made only in full compliance with the provisions of Rule
144.
(c) The address of S-C Partner's principal office
is set forth on its Certificate of Representations dated the
date hereof. S-C Partners qualifies as an "accredited
investor" for purposes of Regulation D promulgated under the
Securities Act for the reasons specified in such Certificate
of Representations. S-C Partners acknowledges that the
Company has made available to it at a reasonable time prior to
the execution of the Certificate of Representations the
opportunity to ask questions and receive answers concerning
the terms and conditions of the sale of securities
contemplated by the Agreement, and to obtain any additional
information (which the Company possesses or can acquire
without unreasonable effort or expense) as may be necessary to
verify the accuracy of the information furnished to it. S-C
Partners (i) is able to bear of loss of its entire investment
in the Securities being acquired by it without any material
adverse effect on its business, operations or prospects, and
(ii) has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits
and risks of the investment to be made by it pursuant to the
Agreement and pursuant hereto.
4. Except as modified hereby, the Agreement
remains in full force and effect.
5. This Agreement (a) represents the entire
agreement among the parties with respect to the subject matter hereof,
superseding all prior agreements and understandings, written or oral, (b) may
be amended only in writing, (c) may be executed in counterparts, each of which
shall be deemed an original and all of which shall constitute one agreement,
(d) shall
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inure to the benefit of, and be binding upon, the parties hereto and their
respective successors and assigns and (e) shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts
entered into and to be performed wholly within such State.
If the foregoing accurately reflects our agreement, please
sign where indicated below.
Very truly yours,
AGREED:
S-C PHOENIX PARTNERS
By S-C Phoenix Holdings, L.L.C.,
its general partner
By: /s/
-----------------------------
Name:
Title:
