EXHIBIT 2.2
AMENDMENT
TO
AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
THIS AMENDMENT TO AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
("Amendment") is made and entered into as of July 25, 2000, by and among: DITECH
COMMUNICATIONS CORPORATION, a Delaware corporation ("Parent"); OXYGEN
ACQUISITION CORPORATION, a Delaware corporation and a wholly owned subsidiary of
Parent ("Merger Sub"); and ATMOSPHERE NETWORKS, INC., a Delaware corporation
(the "Company"). Certain other capitalized terms used in this Amendment are
defined in Exhibit A to the Reorganization Agreement (as defined below).
RECITALS
A. The parties entered into an Agreement and Plan of Merger and
Reorganization dated as of June 21, 2000 (the "Reorganization Agreement"),
pursuant to which the parties have agreed to effect a merger of Merger Sub with
and into the Company in accordance with the Reorganization Agreement and
Delaware General Corporation Law.
B. The parties wish to amend the Reorganization Agreement for the
limited purposes described below.
AGREEMENT
NOW, THEREFORE, in consideration of these premises and of the mutual
agreements, representations, warranties and covenants herein contained, the
parties do hereby agree as follows:
SECTION 1. AMENDMENT OF REORGANIZATION AGREEMENT
1.1 AMENDMENT OF SECTION 1.8(C). Section 1.8(c) of the
Reorganization Agreement is hereby amended and restated in its entirety to
read as follows:
For purposes of this Section 1.8, "Escrow Fraction" shall mean a
fraction (A) whose numerator is the number of shares representing 10%
of the sum of (i) the Fully Diluted Company Shares, (ii) the Series B
Escrow Share Adjustment (as defined below), and (iii) the Series C
Escrow Share Adjustment (as defined below), and (B) whose denominator
is the sum of (1) the number of shares of the
2.
Fully Diluted Company Shares that are actually issued and outstanding
immediately prior to the Effective Time, (2) the Series B Escrow
Share Adjustment, and (3) the Series C Escrow Share Adjustment. With
respect to those Merger Stockholders whose shares of Company Common
Stock are subject to repurchase by the Company (pursuant to a
restricted stock purchase agreement or otherwise), and who exchange
such shares for shares of Company Series A Preferred Stock in the
Recapitalization Transaction, the number of Escrow Shares deposited
on behalf of each such Merger Stockholder shall be prorated between
such Merger Stockholder's shares subject to repurchase ("Unvested
Shares") and such Merger Stockholder's shares not subject to
repurchase ("Vested Shares") based on the respective number of
Unvested Shares and Vested Shares held by such Merger Stockholders
immediately prior to the Effective Time. The "Series B Escrow Share
Adjustment" shall be the product obtained by multiplying (A) the
number of shares of Company Series B Preferred Stock outstanding
immediately prior to the Effective Time, by (B) a fraction having a
numerator equal to the excess (if any) of $3.2937 over the Common
Share Price, and a denominator equal to the Common Share Price. The
"Series C Escrow Share Adjustment" shall be the product obtained by
multiplying (A) the number of shares of Company Series C Preferred
Stock outstanding immediately prior to the Effective Time, by (B) a
fraction having a numerator equal to the excess of $6.53 over the
Common Share Price, and a denominator equal to the Common Share
Price.
1.2 ADDITION OF SECTION 1.12. A new section 1.12 of the
Reorganization Agreement is hereby added to the Reorganization Agreement,
which shall read in its entirety as follows:
At the Effective Time, each Company Warrant that is then outstanding
shall be assumed by Parent. Each Company Warrant so assumed by Parent
under this Agreement will continue to have, and be subject to, the same
terms and conditions of such Company Warrant immediately prior to the
Effective Time (including any terms of such Company Warrant permitting
the "net exercise" thereof), except that (a) each Company Warrant
assumed by Parent may be exercisable solely for shares of Parent Common
Stock, (b) the number of shares of Parent Common Stock subject to each
assumed Company Warrant shall be equal to the product of the number of
shares of Company Preferred Stock that were issuable upon exercise of
such Company Warrant immediately prior to the Effective Time multiplied
by the Applicable Fraction, rounded to the nearest whole number of
shares of Parent Common Stock, (c) the per share exercise price for the
shares of Parent Common Stock issuable upon exercise of such assumed
Company Warrant will be equal to the quotient determined by dividing
(1) the exercise price per share of Company Preferred Stock issuable
upon the exercise of such Company Warrant immediately prior to the
Effective Time, by (2) the Applicable Fraction, such quotient rounded
up to the nearest whole cent, and (d) all restrictions on the exercise
of each such assumed Company Warrant shall continue in full force and
effect, and the term, exercisability and other provisions of such
Company Warrant shall otherwise remain unchanged; PROVIDED, HOWEVER,
that each such assumed Company Warrant shall, in accordance with its
terms, be subject to further adjustment as appropriate to reflect any
stock split, reverse stock split, stock
3.
dividend, recapitalization or other similar transaction effected by
Parent after the Effective Time. The Company and Parent shall take
all action that may be necessary to effectuate the provisions of this
Section 1.12.
1.3 FULLY DILUTED PRE-TERMINATION SHARES. The definition of "Fully
Diluted Pre-Termination Shares" in Section 1.5(b)(iv) of the Reorganization
Agreement is hereby amended and restated in its entirety to read as follows:
The "Fully Diluted Pre-Termination Shares" shall be the sum of (A) the
aggregate number of shares of Company Common Stock outstanding
immediately prior to the Effective Time (including any such shares that
are subject to a repurchase option or risk of forfeiture under any
restricted stock purchase agreement or other agreement), (B) the
aggregate number of shares of Company Common Stock issuable upon
conversion of all shares of Company Preferred Stock outstanding
immediately prior to the Effective Time, (C) the aggregate number of
shares of Company Common Stock purchasable under or otherwise subject
to all Company Options outstanding immediately prior to the Effective
Time (including all shares of Company Common Stock that may ultimately
be purchased under Company Options that are unvested or are otherwise
not then exercisable), (D) an additional 33,580 shares of Company
Common Stock (which the parties have agreed to in consideration of the
outstanding Company Warrants as of the Effective Time, whether or not
such Company Warrants are ultimately exercised), and (E) the aggregate
number of shares of Company Common Stock issuable upon conversion of
all other convertible securities of the Company outstanding immediately
prior to the Effective Time.
1.4 NO OTHER AMENDMENTS. Except as it has been specifically amended
pursuant to Sections 1.1, 1.2 and 1.3, the Reorganization Agreement shall
from and after the date hereof continue in full force and effect.
SECTION 2. ADDITIONAL PROVISIONS
2.1 ENTIRE AGREEMENT AND MODIFICATION. The Reorganization Agreement
(including the exhibits thereto), together with this Amendment, constitutes
the entire agreement among the parties with respect to the subject matter
thereof and hereof and supersedes any prior understandings, agreements, or
representations by or among the parties, written or oral, to the extent they
related in any way to the subject matter hereof and thereof. The
Reorganization Agreement, as amended by this Amendment, may not be further
amended except by a written agreement executed by all parties.
2.2 COUNTERPARTS. This Amendment may be executed in counterparts,
each of which shall be deemed an original but all of which together will
constitute one and the same instrument.
2.3 HEADINGS. The Section headings contained in this Amendment are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Amendment.
4.
2.4 SEVERABILITY. Any term or provision of this Amendment that is
invalid or unenforceable in any situation in any jurisdiction shall not
affect 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.
5.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first written above.
PARENT: DITECH COMMUNICATIONS CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and Chief Financial Officer
MERGER SUB: OXYGEN ACQUISITION CORPORATION
By: /s/ XXXXXXX X. XXXXXXX
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and Chief Financial Officer
COMPANY: ATMOSPHERE NETWORKS, INC.
By: /s/ XXXXXX X. XXXXXX
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Name: Xxxxxx X. Xxxxxx
Title: Chief Executive Officer and President
6.
