March 7, 2000
Constellation 3D, Inc.
000 Xxxx Xxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxx
President and CEO
Re: Amendment No. 2 to Placement Agency Agreement
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Dear Xx. Xxxxxx:
The parties hereto, Constellation 3D, Inc. (f/k/a C3D Inc.), a Florida
corporation (the "Company") and Sands Brothers & Co., Ltd., a Delaware
corporation ("Sands Brothers") have entered into that certain placement agency
agreement (hereinafter the "Agency Agreement") dated as of December 1, 1999, as
amended December 22, 1999.
In connection therewith, the parties hereto agree that the Agency
Agreement is hereby amended as follows:
1. The introductory paragraph of the Agency Agreement is hereby deleted
in its entirety and in its place and stead the following is inserted:
"The undersigned, Constellation 3D, Inc. (f/k/a/ C3D Inc.), a
corporation organized under the laws of the state of Florida (together
with any of its subsidiaries, affiliates, successors or assigns the
"Company"), proposes to offer for sale to certain "accredited
investors, through Sands Brothers & Co., Ltd., in accordance with the
terms and conditions specified in the letter agreement dated October
25, 1999 between the parties hereto (the "Letter Agreement"), as
exclusive placement agent ("Sands Brothers" or the "Placement Agent")
on a best efforts basis, a minimum of $4,000,000 (the "Minimum Amount")
and a maximum of $120,000,000 (the "Maximum Amount") of (a) the
Company's capital stock (whether Common Stock or Preferred Stock
convertible into Common Stock) (collectively, the "Capital
Constellation 3D, Inc.
March 7, 2000
Page 2
Stock"), at a price equal to a 30% discount to the average of the bid
price for the 30 day period prior to the Closing (the "Minimum Offering
Price") with respect to the Minimum Amount, and with respect to an
amount in excess of the Minimum Amount and up to the Maximum Amount, at
the Minimum Offering Price but in no event less than $12.00 per share
and/or (b) any other similar form of debt financing transactions
(hereinafter, collectively "Other Financing"). The Capital Stock and
Other Financing instruments (the "Securities") to be offered pursuant
to the Offering Documents (as hereinafter defined) and Other Financing
transactions to be consummated are sometimes hereinafter referred to
collectively as the "Financing" or the "Offering."
2. Paragraph 4(e) of the Agency Agreement is hereby deleted in its
entirety and in its place and stead the following is inserted:
"(e) Issuance of Placement Agent Warrants. At each Closing as provided
in paragraph 4(a) above, the Company shall issue to the Placement Agent
or its designee(s), subject to the ratable adjustment of the shares
underlying the Placement Agent Warrants (hereinafter defined) and the
exercise price thereof in the event of any Company dividend, stock
split or reclassification declared after the date hereof, (i) with
respect to the sale of the Minimum Amount, warrants to purchase 350,000
shares of the Company's Common Stock ("Initial Placement Agent
Warrants") and (ii) 200,000 warrants for each $1,000,000 of all
Securities sold in the Financing up to an aggregate of $25,000,000
("the Additional Placement Agent Warrants") (collectively referred to
as the "Placement Agent Warrants"). The Initial Placement Agent
Warrants shall be exercisable for five (5) years, commencing upon the
date of their issuance, at a price of $11.00 per share of Common Stock.
The Additional Placement Agent Warrants shall be exercisable for five
(5) years, commencing upon the date of their issuance, at a price equal
to a 40% discount to the average of the bid price of the Common Stock
for the 60 day period prior to any Closing, but in no event less than
of $15.00 per share. The Placement Agent Warrants shall be in the form
attached hereto as Exhibit B, and will be governed by the terms of the
Warrant Agreement attached hereto as Exhibit C. The certificates
representing the Placement Agent Warrants will be in such denominations
and such names as the Placement Agent may request prior to each
closing. The Placement Agent Warrants may not be assigned by Sands
Brothers, except to Sands Brothers' employees, without the written
consent of the Company. All issuance of Placement agent warrants will
be done in full compliance with applicable law."
3. Except as set forth herein, the Agency Agreement shall remain in
full force and effect.
Constellation 3D, Inc.
March 7, 2000
Page 3
IN WITNESS WHEREOF, the Company and Sands Brothers have caused
this Agreement to be executed by its duly authorized representative.
CONSTELLATION 3D, INC. SANDS BROTHERS & CO., LTD.
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx Xxxxx
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Name: Xxxxxx Xxxxxx Name: Xxxx Xxxxx
Title: President Title: Managing Director
Date: March 7, 2000 Date: March 7, 2000
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