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Exhibit 2.3
DEBENTURE PURCHASE AGREEMENT
THIS DEBENTURE PURCHASE AGREEMENT (this "Agreement"), dated as of
March 2, 2001, is made by and among Xxxxx Road LLC, a Cayman Island limited
liability company (the "Seller"), WILC Acquisition Corporation, a Delaware
corporation (the "Purchaser") and Wasatch Interactive Learning Corporation, a
Washington corporation (the "Company").
RECITALS
A. The Company and the Seller are parties to a Securities Purchase
Agreement, dated March 16, 2000 (the "Xxxxx Road Initial Purchase
Agreement), as amended by a letter dated December 19, 2000 ( the "
Xxxxx Road Amendment", and together with the Xxxxx Road Initial
Purchase Agreement, the "Xxxxx Road Purchase Agreement"), pursuant to
which the Company issued and sold to the Seller US$4,000,000 aggregate
principal amount of the Company's 7% Convertible Debenture due March
16, 2003 (the "Debenture").
B. As of the date hereof, the Seller owns the Debenture in an aggregate
principal amount of US$3,787,957.06 (the "Outstanding Principal
Amount").
C. The Purchaser desires to purchase from the Seller, and the Seller
desires to assign and sell to the Purchaser, the Debenture upon the
terms and subject to the conditions set forth herein (the "Debenture
Purchase").
D. The Purchaser and the Company are parties to that certain Agreement
and Plan of Merger, dated January 31, 2001, by and among the
Purchaser, the Company and PLATO Learning, Inc., a Delaware
corporation ("PLATO"), as amended by that certain Amendment No. 1 to
Agreement and Plan of Merger, dated February 20, 2001, by and among
the Purchaser, the Company and PLATO (the "Merger Agreement"),
pursuant to which the parties thereto have agreed, among other things,
to merge the Company with and into the Purchaser (the "Merger").
E. Pursuant to the Merger Agreement, as a condition to the consummation
of the Merger, the Company shall hereby consent to and permit the
Debentures Purchase and the corresponding assignment of the Debenture
from the Seller to the Purchaser, as contemplated herein.
AGREEMENTS
In consideration of the recitals and the respective agreements,
covenants, representations and warranties contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
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ARTICLE I
SALE AND PURCHASE OF DEBENTURE
1.1 Sale and Purchase of Debenture. Upon the terms and subject to the
satisfaction of the conditions set forth herein, the Seller hereby agrees to
sell, convey and assign to the Purchaser, and the Purchaser hereby agrees to
purchase and acquire from the Seller, at the Closing (as hereinafter defined),
the Debenture having an aggregate principal amount equal to the Outstanding
Principal Amount or such lesser aggregate principal amount of the Debenture
outstanding as of the Closing that may have been reduced from time to time by
the Company solely as a result of the Company's redemption obligations pursuant
to Paragraph 1 of the Xxxxx Road Amendment (the "Closing Date Principal
Amount"), free and clear of all Liens (as hereinafter defined), in exchange for
the payment of the total purchase price equal to the sum of: (A) the Closing
Date Principal Amount; (B) an amount equal to the product of (i) ten percent
(10%) and (ii) the Closing Date Principal Amount; and (C) all accrued interest
due and owing on the Debenture as of and including the date of the Closing
calculated in accordance with the terms and conditions of the Xxxxx Road
Purchase Agreement (collectively, the "Purchase Price").
1.2 Closing. The closing of the purchase and sale of the Debenture
hereunder (the "Closing") will take place at the offices of Winston & Xxxxxx, 00
Xxxx Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx on the date immediately prior to the
consummation of the transactions contemplated under the Merger Agreement,
designated by Purchaser. No later than one (1) business day prior to the
Closing, the Purchaser shall deliver written notice to Seller setting forth the
calculation of the Purchase Price. At the Closing:
(a) the Seller will deliver to the Purchaser the certificate for the
Debenture purchased by the Purchaser, duly assigned, transferred or
conveyed to the Purchaser; and
(b) the Purchaser will deliver to the Seller by wire transfer to any
account designated in writing by the Seller or in any other manner
acceptable to the Seller, a payment equal to the amount of cash of the
Purchase Price.
ARTICLE II
CONDITIONS TO CLOSING
2.1 Conditions to Closing for Purchaser. The obligation of the Purchaser
to purchase the Debenture at the Closing is subject to the fulfillment to its
satisfaction of each of the following conditions (unless waived in writing by
the Purchaser):
(a) Representations and Warranties. The representations and warranties
made by the Seller in Article III hereof shall be true and correct.
(b) Performance. All covenants, agreements and conditions contained in
this Agreement to be performed or complied with by the Seller at or prior
to the Closing shall have been performed or complied with by the Seller.
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(c) Legal Investment. As of the Closing, the purchase of the
Debenture by the Purchaser shall be legally permitted by all laws and
regulations to which the Purchaser and the Seller are subject.
(d) Conditions to Merger. As of the Closing, all covenants, agreements
and conditions contained in the Merger Agreement to be performed or
complied with by the parties thereto at or prior to the Closing shall have
been performed, complied with, satisfied or waived by the parties to the
Merger Agreement.
2.2 Conditions to Closing for Seller. The obligation of the Seller to
sell, convey and assign the Debenture at the Closing is subject to the
fulfillment to its satisfaction of each of the following conditions (unless
waived in writing by the Seller):
(a) Representations and Warranties. The representations and warranties
made by the Purchaser in Article IV hereof shall be true and correct.
(b) Performance. All covenants, agreements and conditions contained in
this Agreement to be performed or complied with by the Purchaser at or
prior to the Closing shall have been performed or complied with by the
Purchaser.
(c) Legal Investment. As of the Closing, the sale of the Debenture by
the Seller shall be legally permitted by all laws and regulations to which
the Purchaser and the Seller are subject.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As a material inducement to the Purchaser to enter into this Agreement and
consummate the transactions contemplated hereby, including without limitation,
the sale and purchase of the Debenture, the Seller represents and warrants to
the Purchaser as follows:
3.1 Organization and Qualification. The Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of
the Cayman Islands and is duly qualified and in good standing in such
jurisdiction. The Seller has the corporate or equivalent power and authority
necessary to own, lease, operate or otherwise hold its properties and assets and
to carry on its business as presently conducted.
3.2 Authority. The Seller has the requisite capacity to execute and
deliver this Agreement and to perform its obligations hereunder. This Agreement
is binding upon, and enforceable against, the Seller in accordance with its
terms, subject to bankruptcy, insolvency, reorganization and other laws
affecting creditors' rights generally and by general principles of equity
(whether in a proceeding at law or in equity).
3.3 No Conflicts. Neither the execution or delivery of this Agreement by
the Seller nor the performance by the Seller of its obligations under this
Agreement will conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any contract or permit to which
the Seller is a party or is bound, the operating agreement of the Seller or any
applicable law, statute, order, judicial decree, judgment or regulation to which
the Seller is a party or by which the Seller is bound.
3.4 No Violations. The Seller has not violated any law, statute, order,
judicial decree, judgment or regulation in connection with the offer for sale or
sale of the Debenture.
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3.5 Ownership of Debenture. The Seller owns the Debenture, free and
clear of any lien (statutory or other), mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance or preference, priority or security
agreement or preferential arrangement of any kind or nature whatsoever
(including, without limitation, the interest of a vendor or lessor under any
conditional sale, capitalized lease or other title retention agreement)
(collectively, "Liens"). The Seller is the record and beneficial owner of the
Debenture. The Debenture to be sold by the Seller constitute all of the issued
and outstanding Debenture of the Company and upon delivery of and payment by
the Purchaser to the Seller of the Purchase Price in respect of the Debenture,
Purchaser will acquire good and marketable title to the Debenture free and
clear of all Liens.
3.6 Consents. No consent, approval, order or authorization of, or
registration, declaration or filing with, any governmental, regulatory or
administrative body, agency or authority, any court of judicial authority, any
arbitrator or any public, private or industry regulatory authority, whether
foreign, federal, state or local or any other person is required to be obtained
or made by Seller in connection with the execution and delivery of this
Agreement or the performance by Seller of its obligations hereunder.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As a material inducement to the Seller to enter into this Agreement and
consummate the transactions contemplated hereby, including without limitation,
the sale and purchase of the Debenture, the Purchaser represents and warrants
to the Seller as follows:
4.1 Organization and Qualification. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is duly qualified and in good standing in such jurisdiction. The
Purchaser has the corporate power and authority necessary to own, lease, operate
or otherwise hold its properties and assets and to carry on its business as
presently conducted.
4.2 Authority. The Purchaser has the requisite capacity to execute and
deliver this Agreement and to perform its obligations hereunder. This Agreement
is binding upon, and enforceable against, the Purchaser in accordance with its
terms, subject to bankruptcy, insolvency, reorganization and other laws
affecting creditors' rights generally and by general principles of equity
(whether in a proceeding at law or in equity).
4.3 No Conflicts. Neither the execution or delivery of this Agreement by
the Purchaser nor the performance by the Purchaser of its obligations under this
Agreement will conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any contract or permit to which
the Purchaser is a party or is bound, the by-laws of the Purchaser or any
applicable law, statute, order, judicial decree, judgment or regulation to which
the Purchaser is a party or by which the Purchaser is bound.
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4.4 No Violations. The Purchaser has not violated any law, statute, order,
judicial decree, judgment or regulation in connection with the offer for the
purchase or purchase of the Debenture.
4.5 Consents. No consent, approval, order or authorization of, or
registration, declaration or filing with, any governmental, regulatory or
administrative body, agency or authority, any court of judicial authority, any
arbitrator or any public, private or industry regulatory authority, whether
foreign, federal, state or local or any other person is required to be obtained
or made by Purchaser in connection with the execution and delivery of this
Agreement or the performance by Purchaser of its obligations hereunder.
4.6 Accredited Investors. The Purchaser is an accredited investor as
defined in Rule 501(a) promulgated under the Securities Act of 1933, as amended.
4.7 Financial. The Purchaser has the resources or the ability to secure
the resources to finance the Debenture Purchase pursuant to the terms and
conditions contained herein.
ARTICLE V
AGREEMENTS OF COMPANY
5.1 Consent to Debenture Purchase. Company irrevocably consents to the
sale, assignment and conveyance of the Debenture contemplated by this
Agreement, which consent shall be sufficient to satisfy any and all consent or
other rights that Company may have with respect to a sale, disposition or other
transfer of the Debenture by the Seller pursuant to the Xxxxx Road Purchase
Agreement or otherwise.
5.2 Record Holder. Company agrees that, upon the consummation of the
purchase and sale of the Debenture contemplated by this Agreement, the
Purchaser shall be the record holder of the Debentures, with all of the rights
and privileges of a record holder of such Debentures under the Xxxxx Road
Agreement and the Debenture, and the agreements and registrations entered into
in connection therewith.
5.3 Release. If the Purchase Price pursuant hereto is paid in full in
accordance with the terms hereof, then based on the good and valuable
consideration exchanged between Company and the Seller, each of the Seller and
Company (as such, a "RELEASOR") hereby releases and discharges the other and its
predecessors, successors, and affiliates, employees, officers, directors,
agents, representatives, and assigns (collectively, "RELEASEES"), from all
actions, causes of action, suits, debts, dues, assessments, late fees, sums of
money, expenses, accounts, reckonings, bonds, bills, specialties, covenants,
contracts, controversies, agreements, promises, variances, trespasses, damages,
judgments, executions, obligations, duties, claims, matters, liabilities,
violations of law, fines, penalties, responsibilities, attorneys' fees,
maintenance charges, and demands whatsoever, in law, admiralty or equity, which
against the RELEASEES (or any of them) the RELEASORS, RELEASOR's successors or
assigns ever had, now have or hereafter can shall or may have, for, upon or by
reason of any matter, cause or thing whatsoever from the beginning of the world
to the date of this Agreement.
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ARTICLE VI
TERMINATION
6.1 Termination by Mutual Consent. This Agreement may be terminated and
the Debenture Purchase may be abandoned at any time prior to the Closing by the
mutual written consent of the Seller and the Purchaser.
6.2 Termination by the Purchaser. This Agreement may be terminated and the
Debentures Purchase may be abandoned at any time prior to the Closing by action
of the Purchaser if the Merger Agreement shall be terminated for any reason by
any party.
6.3 Termination by the Seller. This Agreement may be terminated and the
Debenture Purchase may be abandoned at any time prior to the Closing, by action
of the Seller if the Debenture Purchase shall not have been consummated on or
prior to May 1, 2001.
ARTICLE VII
MISCELLANEOUS
7.1 Successors and Assigns. This Agreement will bind and inure to the
benefit of the respective successors and assigns of the parties hereto.
7.2 Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience of reference only and do not constitute a part of and
shall not be utilized in interpreting this Agreement.
7.3 Notices. Any notices required or permitted to be sent hereunder shall
be delivered personally, sent by United Stated mail, registered certified mail,
return receipt requested, with postage prepaid, or sent by reputable overnight
courier service, with all charges prepaid, to the following addresses, or such
other address as any party hereto designates by written notice to the Seller,
and shall be deemed to have been given upon delivery, if delivered personally,
three days after mailing, if mailed as provided above, or one business day after
delivery to the courier, if deposited with an overnight courier service as
provided above:
If to the Seller to:
Xxxxx Road LLC
x/x Xxxxx Xxxxxxxx (Xxxxxx) Limited
Commercial Centre, P.O. Box 31106
SMB
Grand Cayman, Cayman Islands British West Indies
Attention:
If to the Purchaser to:
WILC Acquisition Corporation
00000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxx Xxxxx
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With a copy to:
Winston & Xxxxxx
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
If to the Company to:
Wasatch Interactive Learning Corporation
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxxx Xxxx, Xxxx 00000
Attention: Xxxx Xxxxxxxx
7.4 Governing Law. This Agreement shall be governed by the laws of the
State of Illinois.
7.5 Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.
7.6 Specific Performance. Each of the Seller and the Purchaser are
entitled to specific performance of the obligations of the parties under this
Agreement. Each party to this Agreement agrees that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach of its
obligations described in the foregoing sentence and hereby agrees to waive in
any action for specific performance of any such obligation the defense that a
remedy at law would be adequate
7.7 Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, and such counterparts together shall constitute one
instrument.
[remainder of page intentionally left blank.
signature page follows.]
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The parties hereto have executed and delivered this Agreement as of the
date first set forth above.
SELLER:
XXXXX ROAD LLC
By: /s/ Navigator Management Ltd.
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PURCHASER:
WILC ACQUISITION CORPORATION
By: /s/ Xxxx X. Xxxxx
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Its: Vice President Finance and Chief
Financial Officer
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COMPANY:
WASATCH INTERACTIVE LEARNING CORPORATION
By: /s/ Xxxxxxx Xxxxxx
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Its: President
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