EXHIBIT 4.2
ESCROW AGREEMENT
AGREEMENT, dated as of October 17, 1996, by and among American Stock
Transfer & Trust Company, a New York corporation (hereinafter referred to as the
"Escrow Agent"), Digital Video Systems, Inc., a Delaware corporation (the
"Company") and Dr. Edmund Sun (the "Stockholder").
WHEREAS, the Company contemplates a public offering ("Public Offering") of
Units ("Units"), each Unit consisting of a maximum of 100 IPO units ("IPO
Units"), with each IPO Unit consisting of one share of its Common Stock, par
value $.0001 per share (the "Common Stock"), one redeemable Class A Warrant (the
"Class A Warrant") and one redeemable Class B Warrant ("Class B Warrant")
through X.X. Xxxxx Investment Banking Corp. as underwriter ("Xxxxx") pursuant to
the registration statement on Form SB-2, as amended (the "Registration
Statement"), filed with the Securities and Exchange Commission (the "SEC").
WHEREAS, in connection with the Public Offering, the Stockholder has agreed
to deposit in escrow 140,760 shares of Common Stock into an escrow.
In consideration of the mutual covenants and promises herein contained, the
parties hereto agree as follows:
1. The terms and conditions of that certain escrow agreement dated as of
April 23, 1996, by and among American Stock Transfer and Trust Company, the
Company, the stockholders of the Company listed on Exhibit A thereto and the
holders of options listed on Exhibit B thereto (the "IPO Escrow Agreement") are
hereby incorporated herein by reference in their entirety. Notwithstanding the
foregoing, for purposes of this Agreement (i) "Effective Date" shall mean the
date hereof, (ii) "Escrow Securities" shall mean 140,760 shares of the Company's
common stock delivered to the Escrow Agent on the date hereof by Dr. Edmund Sun,
and (iii) this Agreement may be modified with the written consent of the parties
hereto and no other consents shall be required.
2. (a) The Escrow Securities are subject to release to the Stockholder
only in the event the conditions set forth herein are met. The Escrow Agent,
upon notice to such effect from the Company as provided in paragraph 5 thereof,
shall deliver the Escrow Securities, together with stock powers executed in
blank, and the Escrow Property deposited in escrow with respect to such Escrow
Securities, to the Stockholder, if, and only if, one of the following conditions
is met:
(i) 70,380 of the Escrow Securities (and the related Escrow
Property) will be released in the event that 50% of the securities escrowed
pursuant to the IPO Escrow Agreement are released to the securityholders parties
thereto pursuant to the terms of the IPO Escrow Agreement; and
(ii) the remaining 70,380 of the Escrow Securities (and the
related Escrow Property) will be released in the event that the remaining 50% of
the securities
escrowed pursuant to the IPO Escrow Agreement are released to the
securityholders parties thereto pursuant to the terms of the IPO Escrow
Agreement.
3. Each notice, instruction or other certificate required or permitted by
the terms hereof shall be in writing and shall be communicated by personal
delivery, fax or registered or certified mail, return receipt requested, to the
parties hereto at the addresses set forth below, or at such other address as any
of them may designate by notice to each of the others:
(i) If the Company, to:
Digital Video Systems, Inc.
0000 Xxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Dr. Edmund Sun
(ii) If to the Stockholder to his addresses as set forth under his
name on the signature pages hereto.
(iii) If to the Escrow Agent, to:
American Stock Transfer & Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxx
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers on the day and year first above
written.
DIGITAL VIDEO SYSTEMS, INC.
By:________________________
Name:
Title:
AMERICAN STOCK TRANSFER
& TRUST COMPANY
By:________________________
Name:
Title:
___________________________
Dr. Edmund Sun
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