Exhibit 4.24.1
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FIRST AMENDMENT TO
STOCK PURCHASE WARRANT
RIGHT TO PURCHASE 76,364 SHARES OF COMMON STOCK
DATED MARCH 31, 1999
THIS FIRST AMENDMENT to the Stock Purchase Warrant Agreement between ValueStar
Corporation (the "Corporation" or "Company") and _______________ (Holder) shall
be effective this 15th day of July 1999. The Stock Purchase Warrant is amended
as follows:
Section 2 - Redemption is hereby amended to such that the redemption
may only be triggered by a Closing Bid Price (as defined) of 363.63%
(initially $5.00) of the Warrant Exercise Price. This amount shall be
adjusted consistent and proportionate to the adjustments described in
Section 3 therein.
In addition the following two new sections are added to the Stock Purchase
Warrant:
10. Registration Rights.
As long as the cashless option described in Section 1(b) of the Stock Purchase
Warrant is not exercised then the holder shall have the following registration
rights subject to the following lockup limitation.
Holder shall have the right, at any time and from time to time until March 31,
2004, to include all of the shares purchased or purchasable upon the exercise of
this Warrant ( the "Registrable Shares") within any Registration Statement of
the Corporation filed by the Corporation covering shares of its Common Stock
other than a Registration Statement filed solely with respect to any employee
benefit plan of the Corporation or an offering solely related to an acquisition
or for which such Registrable Shares cannot, in the sole judgment of the
Company, be appropriately registered. The Corporation shall promptly give
written notice to Holder of any intended registration of its Common Stock not
less than thirty (30) days prior to the anticipated effective date of the
Registration Statement, and Holder shall, within fifteen (15) days of receipt
thereof, notify the Corporation of the number of Registrable Shares it desires
to include in the Registration Statement. The number of Registrable Shares which
may be included by the Holder in any such Registration Statement may be
restricted by the Corporation if, (i) in the opinion of the Corporation's
managing underwriter, the number of shares proposed to be sold by the Holder and
by the Corporation in such offering exceeds the number of securities which can
be sold in such offering or (ii) in the sole opinion of the Corporation, such
registration would conflict with the rights or impair the success of any
registration effected by the Corporation, whether pursuant to the registration
rights granted under that certain Shareholders Agreement dated March 31, 1999,
and any amendments thereto or otherwise. In such event, the Registrable Shares
of Holder to be included within such Registration Statement shall not exceed the
number approved for inclusion therein by the Corporation and/or its managing
underwriter in their sole discretion. Except for the expenses of each Holder's
underwriting fees, discounts, or commissions relating to its sale of Registrable
Shares, all costs or expenses, incident to the registration, qualification or
listing of such securities shall be paid by the Corporation. The Corporation
shall comply with all reasonable requests of Holder made in connection with the
registration, qualification, listing or sale of Registrable Shares under the
provisions set forth herein.
Each Holder of Warrants and Warrant Shares to be sold pursuant to any
Registration Statement (each, a "Distributing Holder") shall severally, and not
jointly, indemnify and hold harmless the Company, its officers and directors,
each underwriter and each person, if any, who controls the Company and such
underwriter, against any loss, claim, damage, expense or liability, joint or
several, as incurred, to which any of them may become subject under the
Securities Act or any other statute or at common law, in so far as such loss,
claim, damage, expense or liability (or actions in respect thereof) arises out
of or is based upon any untrue statement or alleged untrue statement of any
material fact contained in any such Registration Statement, any preliminary
prospectus or final prospectus contained therein, or any amendment or supplement
thereto, or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, in each
case to the
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extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Distributing Holder specifically for use therein. Such Distributing Holder shall
reimburse the Company, such underwriter and each such officer, director or
controlling person for any legal or other expenses reasonably incurred by any of
them in connection with investigating or defending any such liability, as
incurred. Notwithstanding the foregoing, such indemnity with respect to such
preliminary prospectus or such final prospectus shall not inure to the benefit
of the Company, its officers or directors, or such underwriter (or such
controlling person of the Company or the underwriter) if the person asserting
any such loss, claim, damage, expense or liability purchased the securities that
are the subject thereof and did not receive a copy of the final prospectus (or
the final prospectus as then amended, revised or supplemented) at or prior to
the time such furnishing is required by the Securities Act in any case where any
such untrue statement or omission of a material fact contained in the
preliminary prospectus was corrected in the final prospectus (or, if contained
in the final prospectus, was subsequently corrected by amendment, revision or
supplement).
11. Public Offering Lock-Up.
In connection with any public registration of this Company's securities, the
Holder (and any transferee of Holder) agrees, upon the request of the Company or
the underwriter(s) managing such underwritten offering of the Company's
securities, not to sell, make any short sale of, loan, grant any option for the
purchase of, or otherwise dispose of this Warrant, any of the shares of Common
Stock issuable upon exercise of this Warrant or any other securities of the
Company heretofore or hereafter acquired by Holder (other than those included in
the registration) without the prior written consent of the Company and such
underwriter(s), as the case may be, for a period of time not to exceed fourteen
(14) days before and one hundred eighty (180) days after the effective date of
the registration. Upon request by the Company, Xxxxxx (and any transferee of
Xxxxxx) agrees to enter into any further agreement in writing in a form
reasonably satisfactory to the Company and such underwriter(s). The Company may
impose stop-transfer instructions with respect to the securities subject to the
foregoing restrictions until the end of said 180-day period. Any shares issued
upon exercise of this Warrant shall bear an appropriate legend referencing this
lock-up provision.
IN WITNESS WHEREOF, the Corporation has caused this First Amendment to the Stock
Purchase Warrant to be executed by its duly authorized officers and the
corporate seal hereunto affixed effective on the 15th day of July, 1999.
VALUESTAR CORPORATION ACCEPTANCE BY HOLDER
/s/ XXXXX XXXXX __________________________
Xxxxx Xxxxx, President and CEO
/s/ XXXXX X. XXXXXX
Xxxxx X. Xxxxxx, Secretary
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