FIRST AMENDMENT TO MERGER AGREEMENT
Exhibit
10.25
FIRST
AMENDMENT
This
FIRST AMENDMENT TO MERGER AGREEMENT (this “Amendment”)
is
dated as of March 29, 2007 and entered into by and among GoFish Corporation,
a
Nevada corporation (the “Buyer”),
BM
Acquisition Corp Inc., a Delaware corporation and wholly owned subsidiary of
the
Buyer (the “Transitory
Subsidiary”),
Bolt,
Inc., a/k/a Bolt Media, Inc., a Delaware corporation (the “Company”),
and
Xxxx Xxxxx, (the “Indemnification
Representative”),
with
reference to that certain Agreement and Plan of Merger dated as of February
11,
2007, by and among the Buyer, the Transitory Subsidiary, the Company and the
Indemnification Representative (the “Merger
Agreement”).
Capitalized terms used in this Amendment without definition shall have the
meanings set forth in the Merger Agreement.
WHEREAS,
the parties hereto have agreed to amend certain provisions of the Merger
Agreement;
NOW,
THEREFORE, in consideration of the mutual agreements herein contained and
intending to be legally bound hereby, the parties hereto hereby agree as
follows:
ARTICLE
I
AMENDMENTS
TO PURCHASE AGREEMENT
1.1 Section
4.7 of the Merger Agreement is hereby replaced in its entirety with the
following:
(a) Except
as
set forth in Article VI and the Escrow Agreement, each of the Parties shall
bear its own costs and expenses (including legal fees and expenses and the
fees
and expenses of each Party’s own financial advisors and investment bankers)
incurred in connection with this Agreement and the transactions contemplated
hereby (the “Transaction Expenses”). Notwithstanding the foregoing, the Buyer
has agreed to pay prior to the Closing on behalf of the Company $200,000 of
Transaction Expenses incurred by the Company prior to the Closing (the “Bridge
Payment”). Immediately prior to the Closing, the Company will provide to Buyer
an itemized and complete list (the “Transaction Expenses List”) of all
Transaction Expenses incurred or to be incurred by the Company prior to or
in
connection with the Closing. Any of the Company’s Transaction Expenses that were
not paid by the Company prior to the Closing, shall be paid by the Buyer or
the
Surviving Corporation to the extent that such Transaction Expenses, including
the Bridge Payment, do not exceed $250,000. In the event that the Company’s
Transaction Expenses that were not paid by the Company prior to the Closing
exceed $250,000 (such expenses, “Excess Transaction Expenses”), then such Excess
Transaction Expenses shall be paid by Buyer or the Surviving Corporation and
Buyer shall have the right to be reimbursed by the Escrow Agent from the Escrow
Fund on a dollar-for-dollar basis. If the Closing does not occur, the Company
shall reimburse Buyer for the Bridge Payment as provided in Section
7.2.
(b) In
addition, notwithstanding anything herein to the contrary, Buyer shall not
be
responsible for (i) any fees, costs, expenses or other obligations or
liabilities of the Major Stockholders, the Management Shareholders or any other
of the Company Stockholders or (ii) any fees, costs, expenses or other
obligations or liabilities of the Company incurred in connection with the Merger
except those that are solely and directly related to the Merger within the
meaning of Revenue Ruling 73-54. Schedule 4.7 sets forth the Company’s good
faith estimate of the Transaction Expenses by vendor, category and amount.
Notwithstanding any other provision of this Agreement, the fees and expenses
of
counsel with respect to the Record Label Litigation shall be deemed to be
Transaction Expenses. At the Closing, the Buyer shall issue to Savvian, LLC
a
number of shares of Buyer Common Stock equal to $750,000 divided by (y) the
Average Pre-Signing Price and shall issue additional shares of Buyer Common
Stock to Savvian, LLC in accordance with Schedule 1.5(a)(v).
1.2 Article
V
of the Merger Agreement is amended by adding the following to the end
thereof:
5.4 Effect
of
Actions. Effect
of
Actions. The Company acknowledges that it is aware of that certain civil action
captioned Securities and Exchange Commission v. Xxxxx X. Xxxxx, et al., case
no.
07-Civ-1439 (LAP) and the criminal action captioned United States v. Xxxxx
X.
Xxxxx (collectively, the “Actions”) and that on March 12, 2007 the Buyer
delivered to the Company copies of the civil and criminal complaints filed
in
the Actions and other information which constitutes all of the material
information the Buyer is aware of with respect to the Actions. The Company
and
the Buyer each agree that the filing of the Actions and the existence of the
facts underlying them that have been disclosed by the Buyer to the Company
shall not be deemed to have caused a Material Adverse Effect with respect to
the
Buyer and that such filing and existence shall not be deemed a breach of any
representation or warranty made by the Buyer or the Transitory Subsidiary in
the
Agreement. Section
7.1(e)
of the
Merger Agreement is hereby replaced in its entirety with the
following:
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(iii) the
Buyer
may terminate this Agreement if the Closing shall not have occurred on or before
May 31, 2007 (the “Termination Date”) by reason of the failure of any condition
precedent under Section 5.1 or 5.2 hereof (unless the failure results primarily
from a breach by the Buyer or the Transitory Subsidiary of any representation,
warranty or covenant contained in this Agreement):
1.3 Section
7.2
of the
Merger Agreement is hereby replaced in its entirety with the
following:
Effect
of Termination.
(a) If
any
Party terminates this Agreement pursuant to Section 7.1, other than a
termination by the Company pursuant to Section 7.1(c) or 7.1(f) or a termination
by Company or the Buyer pursuant to Section 7.1(g), all obligations of the
Parties hereunder shall terminate without any liability of any Party to any
other Party (except for any liability of any Party for willful breaches of
this
Agreement); provided, however, that in the event of any termination, the Company
shall, within fifteen business days of the date of termination, repay to Buyer
the Bridge Payment.
(b) In
the
event of a termination on or before the Termination Date by the Company or
pursuant to Section 7.1(g) then, the Company shall pay the Buyer the greater
of
(x) $5,000,000 or (y) 25% of the amounts payable to the Company or its
stockholders pursuant to such Superior Offer. In either case of (x) or (y),
the
amount held in escrow pursuant to Section 1.9(d) shall be released to the Buyer
upon the termination of this Agreement and the additional amounts payable shall
be paid to the Buyer upon the closing pursuant to the Superior Offer.
(c) In
the
event of a termination by the Company pursuant to Section 7.1(c) or 7.1(f)
then,
the Buyer shall immediately pay the Company in cash an amount equal to
$1,500,000, provided
that
such
amount shall be reduced by (i) the Bridge Payment, (ii) any other Transaction
Expenses of the Company paid by the Buyer prior to termination and (iii) any
amounts paid by the Buyer on behalf of the Company to Lessor for rent
obligations.
(d) The
Buyer
acknowledges that the Company has entered into a Settlement Agreement and Mutual
Release dated as of March 6, 2007 by and between the Company, UMG Recordings,
Inc., Universal Music Corp., Songs of Universal, Inc, Universal-Polygram
International Publishing, Inc., and Rondor Music International and others (the
“Settlement
Agreement”)
to
settle, compromise and resolve the Record Label Litigation. In the event of
a
termination by the Company pursuant to Section 7.1(f) then, the Buyer shall,
within five business days after the Termination Date, pay to the Company an
amount equal to seventy-five percent (75%) of any incremental amount in excess
of the Initial Payment (as defined in the Settlement Agreement), whether by
means of penalty or otherwise, payable by the Company for failure to timely
pay
the Initial Payment.
(e) Each
Party acknowledges that the agreements contained in Section 7.2(b) and 7.2(c)
are an integral part of the transactions contemplated by this Agreement and
constitute liquidated damages and not a penalty, and that, without these
agreements, the other Parties would not enter into this Agreement.
(f) Notwithstanding
the foregoing provisions of this Section 7.2, the obligations of the Parties
pursuant to Section 4.5(c) (Confidentiality) shall survive any termination
of this Agreement.
ARTICLE
II
MISCELLANEOUS
2.1
Effect
on
Merger Agreement.
On and
after the date of this Amendment each reference in the Merger Agreement to
“this
Agreement,”
“hereunder,”
“hereof,” “herein,” or words of like import referring to the Merger Agreement
shall mean and be a reference to the Merger Agreement as amended by this
Amendment. Except as specifically amended by this Amendment, the Merger
Agreement shall remain in full force and effect and is hereby ratified and
confirmed.
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2.2
Governing Law. This Amendment shall be governed by and construed in
accordance with the internal laws of the State of Delaware without
giving
effect to any choice or conflict of law provision or rule (whether of the State
of Delaware or any other jurisdiction) that would cause
the application of laws of any jurisdictions other than those of the State
of
Delaware.
2.3
Counterparts; Facsimile. This Amendment may be executed in two or more
counterparts, each of which shall be deemed an original and all
of
which
together shall constitute one and the same instrument, and facsimile signatures
shall be deemed, for the purposes of this Amendment, original
signatures.
2.4
Severability. Any term or provision of this Amendment that is
invalid or unenforceable in any situation in any jurisdiction shall not
affec
the validity or enforceability of the remaining terms and provisions hereof
or
the validity or enforceability of the offending term or
provision
in any other situation or in any other jurisdiction. If the final judgment
of a
court of competent jurisdiction declares that any term or
provision hereof is invalid or unenforceable, the Parties agree that the court
making the determination of invalidity or unenforceability shall
have the power to limit the term or provision, to delete specific words or
phrases, or to replace any invalid or unenforceable term or
provision with a term or provision that is valid and enforceable and that comes
closest to expressing the intention of the invalid or
unenforceable term or provision, and this Amendment shall be enforceable as
so
modified.
IN
WITNESS WHEREOF, the Parties hereto have caused this Amendment to be duly
executed and delivered as of the date first above written.
GOFISH
CORPORATION
By:
/s/
Xxxxxxx Xxxxxx __________________
Name: Xxxxxxx
Xxxxxx __________________
Title: President________________________
BM
ACQUISITION CORP INC.
By:
/s/
Xxxxxxx Xxxxxx __________________
Name: Xxxxxxx
Xxxxxx ___________________
Title: President________________________
BOLT,
INC.
By:
/s/
Xxxxx Cohen________________
___
Name: Xxxxx
Xxxxx ____________________
Title: Chief
Executive Officer______________
INDEMNIFICATION
REPRESENTATIVE.
By:
/s/
Xxxx Davis_____________________
Name: Xxxx
Xxxxx ______________________
Title: ________________________________
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