EXHIBIT 2.2
FIRST AMENDMENT TO
STOCK EXCHANGE AGREEMENT
This First Amendment to the Stock Exchange Agreement (the
"Amendment") is entered into in the City of Haifa, Israel, effective as of
January 26, 2001, by and among (i) Xxxx Xxxxxx ("Xxxxxx"), Technion
Entrepreneurial Incubator Company Ltd. ("TEIC", and collectively with Xxxxxx,
the "Founding Organitech Shareholders"); (ii) D. G. Pizza Ltd. and Arie and Xxxx
Xxxxxx (the "Outside Organitech Shareholders", and, collectively with the
Founding Organitech Shareholders, the "Organitech Shareholders"); (iii)
Organitech Ltd, a company formed under the Israeli Companies law ("Organitech");
(iv) Incubate This! Inc., a Delaware corporation ("Incubate"), successor by
merger to Incubate This! Inc., a Colorado corporation, and (v) Xxxxxxx Xxxxxxxxx
("Xxxxxxxxx").
BACKGROUND
Organitech, the Organitech Shareholders, Incubate and
Xxxxxxxxx are parties to a Stock Exchange Agreement (the "Original Agreement"),
providing for the exchange by the Organitech Shareholders of Organitech stock
for Incubate stock, such that Organitech shall become a wholly-owned subsidiary
of Incubate. The parties now desire to amend the Original Agreement. Capitalized
terms used in this Amendment, and not otherwise defined, shall have the meanings
ascribed to them in the Original Agreement.
NOW THEREFORE, in consideration of the premises and of the
mutual promises, covenants, representations and warranties made in this
Amendment, the parties hereto, intending to be legally bound, hereby agree to
amend the Original Agreement as follows:
1. Section 3.2.1.5 of the Original Agreement shall be amended by adding
the phrase "attached as Schedule 3.2.1.5" after the phrase "An opinion
letter of Organitech's Israeli counsel".
2. Section 4.28.11 of the Original Agreement shall be amended by adding
the following at the end of the Section:
2.1. "As a result of the postponement of the closing of the
Original Agreement Organitech resources available for salaries
and other operational payments were exhausted by December 31,
2000. Organitech was under legal obligations to give all of
its employees advanced notice of termination of employment at
the beginning of December 2000 which notice became effective
at the beginning of January 2001. Upon receipt of notice from
Incubate on a tentative closing date, the board of directors
of Organitech authorized the continuation of the employment of
the employees through January 15, 2001 at minimum salary
permitted by law. Most of the employees have expressed their
desire to resume their employment upon the closing of the
Original Agreement and the availability of funds.
"In the opinion of the President of Organitech, Organitech is
not in breach of any of the agreements listed in Schedule
4.28. However, it is represented that Net Alim, a party to the
Organitech Le'Ami Agreement dated February 24, 2000, is
claiming that performance of the 2 beta version prototypes are
not satisfactory. The main argument made by Net Alim is the
issue of the weight of the heads of lettuce produced by the
systems. They are claiming that the weight of the lettuce does
not comply with the weight orally represented to them. The
agreement specifically states that the machines to be
delivered to it are the first two machines assembled by
Organitech and as such they are experimental equipment and may
suffer from defects.
"It is further represented that under the Memorandum of
Understanding ("MOU") between Agronaut and Organitech dated
July 9, 2000, Organitech is obligated to deliver two beta site
models by January 2001 for experiments in Singapore. It was
orally agreed by the parties that the delivery of the two
machines would be delayed to a date to be agreed upon by the
parties in order to allow further testing and experimental
running at the premises of Organitech prior to shipment. There
is no documentation confirming the above."
The Company and its President, Xxxx Xxxxxx, represent that in
their bona fide opinion should any of the employees, Agronaut
or Net Alim bring an action against the Company for any of the
issues referred to above, the potential award (if any) shall
not materially adversely affect the Company.
2.2. No employee has received registration rights under the U.S.
Security Act of 1933, as amended, preemptive or tag along
rights.
3. Section 5 of the Original Agreement shall be amended as follows:
3.1. Section 5.1 is hereby amended by:
3.1.1. substituting the word "Delaware" for the word
"Colorado" in the first sentence thereof; and
3.1.2. substituting the word "including" for the phrase
"other than."
3.2. Section 5.3 is hereby amended by adding the phrase "Incubate
has been advised by counsel that" after the word "Agreement"
as it appears for the first time in the last sentence thereof.
3.3. Section 5.4 is hereby amended by:
3.3.1. replacing the last sentence thereof with the text
"All shares issued by Incubate are tradable only in
accordance with Rule 144, including those held by
persons deemed to be affiliates of Incubate"; and
3.3.2. deleting "12 million shares" and replacing it with
"11,100,000 shares" and
3.3.3. deleting "4.5M shares" and replacing it with "3.6M
shares".
3.4. Section 5.7 is hereby amended by deleting the number
"$3,000,000" and inserting in its place the number
"$2,400,000".
3.5. Section 5.8 is hereby amended by:
3.5.1. substituting the phrase "December 31, 1998 and 1999
and unaudited statements for September 30, 2000" for
the phrase "December 31, 1998, 1999 and June 30, 2000
YTD"; and
3.5.2. substituting the word "September" for the word "June"
as it appears in the second to last sentence thereof.
3.6. Section 5.9 is hereby amended by substituting the word
"September" for the word "June".
3.7. Section 5.12 is hereby amended by substituting the phrase
"with the Form D executed prior to the Closing for filing
immediately after the Closing" for the phrase "prior the
Closing [Form D?]."
3.8. Section 5.33 is hereby amended by adding the phrase "Except as
specifically set out in the Information Statement filed with
the SEC as part of the meeting of the shareholders to approve
the Agreement and the transaction contemplated therein," at
the beginning of the first and fourth sentences thereof.
3.9. Section 5.34 is hereby amended by deleting "Three Million U.S.
Dollars (US$3,000,000)" and adding in its place "Two Million
Four Hundred Thousand U.S. Dollars (US$2,400,000)".
3.10. Section 5.35 is hereby amended by adding the phrase "other
than current obligations for legal and accounting work in an
amount not in excess of $5,000.00 in the aggregate and
obligations incurred by Incubate in the ordinary course of
business in amount not in excess of $[1,000] per payee." at
the end of the sentence thereto.
3.11. Section 5.41 is hereby amended by substituting the phrase "at
or in a reasonable amount of time following" for the word
"prior."
4. Schedules. Any Schedule or Exhibit attached hereto as Appendix 1 shall
substitute the corresponding Schedule or Exhibit of the Original
Agreement. In the event that such Exhibit or Schedule was not attached
to the Original Agreement at the time of the signing of the Original
Agreement, such Schedule or Exhibit shall constitute an integral part
of the Original Agreement as if it would have originally attached.
5. Allocation of Marketing Rights. The parties anticipate that the
research and development and manufacturing of the Organitech products
will be conducted by Organitech Ltd. (Israel) and that the marketing of
Organitech's commercial product, when completed will be carried out,
overseen and controlled by Incubate and/or its present and future
direct subsidiaries as Incubate's board of directors may determine from
time to time.
6. Balance of Original Agreement. All other terms and conditions of the
Original Agreement not specifically amended by this Amendment shall
remain in full force and effect and are hereby ratified and confirmed
by the parties to the Original Agreement.
7. Amendment. This Amendment and the Original Agreement may be further
modified or amended only by a writing duly executed by or on behalf of
each of the parties thereto.
IN WITNESS WHEREOF, the parties have executed this First
Amendment to the Stock Exchange Agreement on the date first written above.
Organitech Ltd. Incubate This! Inc.
By: By:
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Xxxx Xxxxxx, President Xxxxxxx Xxxxxxxxx, President
Technion Entrepreneurial D. G. Pizza Ltd.
Incubator Company Ltd.
By: By:
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Xxxx Xxxxxx Xxxx Xxxxxx
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Xxxx Xxxxxx Xxxxxxx Xxxxxxxxx
