Exhibit 2.2
AMENDMENT NO. 1 TO MERGER AGREEMENT
THIS AMENDMENT NO. 1 TO MERGER AGREEMENT, dated as of November 22, 2005
(this "Amendment"), is made by and among Euroseas Ltd., a corporation organized
under the laws of the Republic of the Xxxxxxxx Islands ("Euroseas"), Euroseas
Acquisition Company Inc., a corporation organized under the laws of the State of
Delaware ("EuroSub"), Cove Apparel, Inc., a Nevada Corporation ("Cove"), Xxxxx
Xxxxxxxx ("X. Xxxxxxxx"), Xxxxx Xxxxxxxx ("X. Xxxxxxxx"), Xxxx Xxxxxx ("Xxxxxx")
and Xxxxxx Xxxxxxx ("Xxxxxxx" and together with X. Xxxxxxxx, X. Xxxxxxxx and
Xxxxxx, each a "Cove Principal" and collectively, the "Cove Principals").
W I T N E S S E T H:
WHEREAS, the parties executed that certain Agreement and Plan of Merger,
dated as of August 25, 2005 (the "Merger Agreement");
WHEREAS, the parties hereto have agreed to amend the Merger Agreement on
the terms hereinafter set forth;
NOW, THEREFORE, in consideration of the agreements herein contained, the
parties hereto agree as follows:
ARTICLE I
AMENDMENTS
SECTION 1.1. Amendments to the Merger Agreement.
(a) Effective as of the date hereof, the definition of "Pledged Shares"
in Section 1.1 of the Merger Agreement is hereby deleted in its entirety and
replaced by the following:
"PLEDGED SHARES means 475,000 Euroseas Shares (subject to adjustment
for any reverse stock split by Euroseas) to be received in
connection with the Merger, acquired in private transactions, in the
open market or otherwise) that are pledged to Euroseas by the Cove
Principals or other pledgors reasonably acceptable to Euroseas and
deposited with an independent collateral agent in accordance with
Section 9.2 below to secure the indemnification obligations of the
Cove Principals under Article IX of this Agreement."
(b) Effective as of the date hereof, the first sentence of Section
3.2(a) of the Merger Agreement is hereby deleted in its entirety and replaced by
the following:
"(a) As of immediately prior to the Closing, the authorized capital
stock of Euroseas shall consist solely of 100,000,000 common shares,
$0.01 par value, and 20,000,000 preferred shares, $0.001 par value,
of which 29,754,166 common
shares (subject to adjustment for any reverse stock split by
Euroseas and excluding any shares and warrants to be issued in the
Private Placement Transaction), and no preferred shares, will be
issued and outstanding."
(c) Effective as of the date hereof, the third and fourth lines of
Section 5.1 of the Merger Agreement are hereby amended by deleting the words
"the other party" and replacing them with the words "either Euroseas or Cove, as
applicable...."
(d) Effective as of the date hereof, Section 5.1(b) of the Merger
Agreement is hereby deleted in its entirety and replaced by the following:
"(b) It shall not (i) split, combine or reclassify its outstanding
capital stock or declare, set aside or pay any dividend or
distribution payable in cash, stock, property or otherwise (other
than (A) a reverse stock split by Euroseas, or (B) any declaration
and payment of dividends, so long as the appropriate amount of such
dividends are held in trust and paid to the Cove stockholders if the
Merger is consummated or paid to Friends if the Merger is not
consummated), (ii) spin-off any assets or businesses, (iii) engage
in any transaction for the purpose of effecting a recapitalization,
or (iv) engage in any transaction or series of related transactions
which has a similar effect to any of the foregoing;"
(e) Effective as of the date hereof, Section 7.2(a) of the Merger
Agreement is hereby amended by deleting the words "each of the Cove Principals
and" in the last line of such section.
(f) Effective as of the date hereof, Section 8.3 of the Merger Agreement
is hereby deleted in its entirety and replaced by the following:
"This Agreement may not be amended except by an instrument in
writing signed by Euroseas and Cove."
(g) Effective as of the date hereof, the first sentence of Section
9.2(c) of the Merger Agreement is hereby deleted in its entirety and replaced by
the following:
"In furtherance of the foregoing, on or prior to the Closing Date,
the Cove Principals shall pledge or cause to be pledged to Euroseas
an aggregate of at least 475,000 Euroseas Shares (after giving
effect to the Merger and the exchange of Cove Common Stock for
Euroseas Shares in connection therewith and subject to any
adjustment for any reverse stock split by Euroseas) by pledgors
reasonably acceptable to Euroseas and such Pledged Shares shall be
deposited with an independent collateral agent to secure the
indemnification obligations of the Cove Principals under this
Article IX
(h) Effective as of the date hereof, Section 10.11 of the Merger
Agreement is hereby deleted in its entirety.
2
(i) Effective as of the date hereof, footnote 1 in Exhibit 2.6 to the
Merger Agreement is hereby deleted in its entirety and replaced by the
following:
"Assumes all outstanding securities in Cove and Euroseas are
exchanged for, or converted to, Euroseas Shares and gives effect to
the contemplated Private Placement Transaction but does not include
any warrants issued in the Private Placement Transaction and does
not take into account any reverse stock split by Euroseas."
ARTICLE II
MISCELLANEOUS
SECTION 2.1. Rules of Construction; Definitions. Capitalized terms not
otherwise defined herein shall have the meanings assigned to such terms in the
Merger Agreement.
SECTION 2.2. No Other Amendment or Waiver. Except for the amendments set
forth herein, the text of the Merger Agreement shall remain unchanged and in
full force and effect, and is hereby ratified and confirmed by the parties. Each
reference in Merger Agreement to "this Agreement" shall mean the Merger
Agreement, as amended by this Amendment, and as hereinafter amended or restated.
SECTION 2.3. Successors and Assigns. This Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and permitted assigns.
SECTION 2.4. Counterparts. This Amendment may be executed by the parties
hereto in several counterparts, each of which when executed and delivered shall
be deemed to be an original and all of which shall constitute together but one
and the same agreement.
SECTION 2.5. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
3
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective authorized officers as of the day and year first
above written.
EUROSEAS ACQUISITION COMPANY, INC.
By: /s/ Xxxxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: President
EUROSEAS LTD.
By: /s/ Xxxxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: President
COVE APPAREL, INC.
By: /s/ Xxxxx Xxxxxxxx
------------------------------
Name: Xxxxx Xxxxxxxx
Title: President
/s/ Xxxxx Xxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxx
/s/ Xxxxx Xxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxx
/s/ Xxxx Xxxxxx
-------------------------------------
Xxxx Xxxxxx
/s/ Xxxxxx Xxxxxxx
-------------------------------------
Xxxxxx Xxxxxxx
4
