Exhibit 2.2
AGREEMENT
TO AMEND THE AGREEMENT OF MERGER
AND TERMINATE THE EMPLOYMENT AGREEMENT
This is an Agreement, effective as of January 18, 2002, by and among
Semotus Solutions, Inc. ("Semotus") and Xxxx Xxxxxx, to amend the Agreement of
Merger dated as of April 30, 2001, between Semotus, ADA Acquisition, Inc., a
Delaware corporation ("Sub"), Application Design Associates, Inc., a Colorado
corporation, (the "Company"), and Xxxx Xxxxxx (the "Shareholder"), and to
terminate the Employment Agreement by and among Xxxx Xxxxxx and ADA Acquisition
Inc. (now named Application Design Associates, Inc.).
WHEREAS, the Company was merged with Sub, and the Shareholder received a
certain number of Parent Shares on the Closing Date, and has the right to
potentially receive a certain additional number of Parent Shares as part of an
earn-out, in accordance with the terms and conditions of the Agreement of
Merger; and
WHEREAS, the parties desire to sell a portion of the Company's stock to a
third party, 2007978 Ontario Inc (the "Purchaser"), and concurrently with the
execution of this Agreement, the parties will execute a Stock Purchase Agreement
and other ancillary agreements (the "Stock Purchase Transaction").
WHEREAS, the parties desire to amend the Agreement of Merger and terminate
the Employment Agreement, so as to be consistent with the purpose of the Stock
Purchase Transaction and the terms and conditions of the Stock Purchase
Agreement.
NOW, THEREFORE, the parties, intending to be legally bound, hereby agree
as follows:
1. The parties agree that upon the Closing Date of the Stock Purchase
Agreement, the Shareholder shall transfer and assign the 250,000 Parent
Shares in the name of the Shareholder that are currently held by Arapahoe
Bank as security for the Acquisition Loan, and such shares shall be
released at the time replacement security is provided by the Purchaser
pursuant to Section 6.8 of the Stock Purchase Agreement.
2. The parties agree that upon the Closing Date of the Stock Purchase
Agreement, Sections 3.3 and 3.4 of the Agreement of Merger shall be
terminated in their entirety and be of no further force or effect.
3. Amendment of Article III, Sections 3.1 and 3.2 of the Agreement of Merger.
Article III, Sections 3.1 and 3.2 of the Agreement of Merger are hereby
amended such that the Shareholder hereby agrees that any Additional Parent
Shares earned and issued pursuant to the Merger Agreement after the date
hereof, up to and including the Option Closing Date, are hereby
transferred and assigned to the Purchaser, and such Additional Parent
Shares shall be issued to the Purchaser instead of to the Shareholder, and
held by the Purchaser until the Option Closing Date, at which time the
shares shall be released per the terms of the Stock Purchase Agreement.
Thereafter, Sections 3.1 and 3.2 of Article
III to the Agreement of Merger shall be terminated and deleted in their
entirety and be of no further force or effect as of the Option Closing
Date.
4. Section 10.1 of the Agreement of Merger is hereby terminated and of no
further force or effect. Both parties are hereby released of any and all
obligations or responsibilities, past, present or future, in connection
with the terms and conditions of Section 10.1 of the Merger Agreement.
5. The Employment Agreement is hereby terminated and of no further force or
effect. Both parties are hereby released of any and all obligations or
responsibilities, past, present or future, in connection with any and all
of the terms or conditions of the Employment Agreement, including all
provisions related to termination of the Employment Agreement.
Shareholder, or `Executive', as defined in the Employment Agreement, is
also released from any and all other non-compete provisions with the
Company or Semotus.
6. The Executive shall continue to be employed by the Company as President of
the Company and continue to serve as a member of the Company's board of
directors through the Option Closing Date, and as part of Executive's
compensation, Executive's stock options pursuant to Semotus' 1996 Stock
Option Plan shall continue to vest and be in full force and effect.
However, the total number of Executive's stock options shall be reduced by
100,000, for a total of 75,000 options. Additionally, all of Executive's
outstanding stock options as of the Effective Date of this Agreement shall
be repriced and have an exercise price of $0.76 per share. If the Option
is exercised by the Purchaser pursuant to the Stock Purchase Agreement,
all of Executive's 75,000 stock options shall accelerate and be fully
vested as of the Option Closing Date; Executive shall then have 90 days to
exercise any part or the whole of these stock options in accordance with
Semotus' Stock Option Plan.
7. Xx. Xxxxxx shall use his best efforts to obtain discharges to the
following seven Colorado UCC Filings against the Company: Report Nos.
902045169; 952038087; 962054769; 19972066893; 19972081718, A8198288,
20002005813.
8. Miscellaneous. All other terms and conditions of the Agreement of Merger
shall remain in full force and effect. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original, and
all of which taken together shall constitute one and the same instrument.
9. Fax Signatures. The parties hereby agree that signatures transmitted and
received via facsimile or other electronic means shall be treated for all
purposes of this Agreement as original signatures and shall be deemed
valid, binding and enforceable by and against both parties.
10. Capitalized terms used and not otherwise defined in this Agreement shall
have the meanings ascribed to them in the Agreement of Merger, the
Employment Agreement and/or the Stock Purchase Agreement, as applicable.
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11. This Agreement is contingent upon the simultaneous execution of The Stock
Purchase Agreement and all other ancillary agreements necessary to
finalize the Stock Purchase Transaction.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SEMOTUS SOLUTIONS, INC.
By: /s/ Xxxxxxx X. XxXxxx
-----------------------------
Name: Xxxxxxx X. XxXxxx
Title: President and CEO
APPLICATION DESIGN ASSOCIATES, INC.
(formerly ADA Acquisition, Inc.)
By: /s/ Xxxxxxx X. XxXxxx
-----------------------------
Name: Xxxxxxx X. XxXxxx
Title: CEO
SHAREHOLDER
By: /s/ Xxxx Xxxxxx
-----------------------------
Name: Xxxx Xxxxxx
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