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EXHIBIT 2.2
AGREEMENT OF MERGER
OF
STORMEDIA ACQUISITION CORPORATION
AND
AKASHIC MEMORIES CORPORATION
This Agreement of Merger, dated as of the 31st day of December, 1997
("MERGER AGREEMENT"), is entered into by and between StorMedia Acquisition
Corporation ("MERGER SUB"), a Delaware corporation and a wholly owned subsidiary
of StorMedia Foreign Sales Corporation, a U.S. Virgin Islands corporation
("STORMEDIA"), and Akashic Memories Corporation, a California corporation
("AKASHIC" or the "SURVIVING CORPORATION").
RECITALS
A. Akashic was incorporated in the State of California on September
26, 1996 and as of December 31, 1997 had 23,335 shares of its Common Stock,
$0.001 par value, outstanding ("AKASHIC COMMON") and 19,200,000 shares of its
Series A Preferred Stock, $0.79828 par value outstanding ("Akashic Preferred").
The Akashic Common and the Akashic Preferred are herein collectively referred to
as the "AKASHIC CAPITAL STOCK".
B. Merger Sub was incorporated in the State of Delaware on December
31, 1997, and on the date hereof has 1,000 shares of its Common Stock, $.001 par
value, outstanding, all of which are owned by StorMedia.
C. The parent of StorMedia (which assigned its interest in such
agreement to StorMedia), Akashic and certain other entities which are direct or
indirect shareholders of Akashic have entered into an Agreement and Plan of
Reorganization dated as of November 28, 1997 (the "REORGANIZATION AGREEMENT")
providing for certain representations, warranties, covenants and agreements in
connection with the transactions contemplated hereby. This Agreement of Merger
and the Reorganization Agreement are intended to be construed together to
effectuate their purpose.
D. The shareholders of Akashic and Merger Sub and the Board of
Directors of StorMedia deem it advisable and in their mutual best interests and
in the best interests of the shareholders of Akashic and Merger Sub,
respectively, that Merger Sub be merged with and into Akashic (the "MERGER").
E. The Boards of Directors of StorMedia, Akashic and Merger Sub and
the shareholders of Merger Sub and Akashic have approved the Merger.
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AGREEMENTS
The parties hereto hereby agree as follows:
1. Merger Sub shall be merged with and into Akashic, and Akashic
shall be the Surviving Corporation.
2. The Merger shall become effective at 4:00 p.m. California time
on December 31, 1997 (the "EFFECTIVE TIME").
3. As of the Effective Time, each outstanding share of Common
Stock, $.001 par value, of Merger Sub shall be converted into and exchanged for
one (1) share of Common Stock, $.01 par value, of the Surviving Corporation.
4. a) Upon the Effective Time of the Merger, each outstanding share
of Akashic Preferred shall, by virtue of the Merger and without any action on
the part of the holder thereof, no longer be outstanding and shall be canceled
and retired and cease to exist, and shall automatically be converted into and
exchanged for the rights to receive $0.52 per share (the "Merger
Consideration"). In no event shall the aggregate consideration paid pursuant to
this Section 4(a) exceed $10,000,000.
b) Upon the Effective Time of the Merger, each outstanding share
of Akashic Common shall, by virtue of the Merger and without any action on the
part of the holder thereof, no longer be outstanding and shall be canceled. No
cash, securities of StorMedia or other consideration shall be paid or delivered
for any share of Akashic Common.
5. As of the Effective Time, all certificates representing shares
of Akashic Capital Stock, issued and outstanding immediately prior to the
Effective Time, shall no longer be outstanding and shall automatically be
canceled and retired and shall cease to exist, and each holder of a certificate
representing any such shares of Akashic Capital Stock shall cease to have any
rights with respect thereto except in the case of Akashic Preferred, the right
to receive the appropriate portion of the Merger Consideration upon surrender of
such certificate.
6. Any shares ("DISSENTING SHARES") of any holder of Akashic
Capital Stock who has demanded and perfected appraisal rights for such shares in
accordance with the California Corporation Code and who, as of the Effective
Time, has not effectively withdrawn or lost such appraisal rights, shall not be
converted into Merger Consideration but shall be converted into the right to
receive such consideration as may be determined to be due with respect to such
Dissenting Shares pursuant to the California Corporation Code. If, after the
Effective Time, any Dissenting Shares shall lose their status as Dissenting
Shares, then as of the occurrence of the event which causes the loss of such
status, such shares shall be converted into Merger Consideration in accordance
with Section 4 hereof.
7. The conversion of Akashic Capital Stock as provided by this
Agreement of Merger shall occur automatically at the Effective Time of the
Merger without action by the holders thereof. Each holder of Akashic Capital
Stock shall thereupon be entitled to receive Merger Consideration in
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accordance with Section 4 hereof. Promptly after the Effective Time, such
shareholder shall be entitled to receive cash in the amount payable to such
shareholder under this Agreement of Merger, without interest thereon, upon
surrender as set forth in the Reorganization Agreement of such shareholder's
certificates which immediately prior to the Effective Time represented
outstanding shares of Akashic Capital Stock.
All Merger Consideration delivered upon the surrender for
exchange of shares of Akashic Capital Stock in accordance with the terms hereof
shall be deemed to have been delivered in full satisfaction of all rights
pertaining to such Akashic Capital Stock. If, after the Effective Time of the
Merger, certificates are presented to the Surviving Corporation for any reason,
they shall be canceled and exchanged as provided in this Section 7.
8. At the Effective Time of the Merger, the separate existence of
Merger Sub shall cease, and Akashic shall succeed, without other transfer, to
all of the rights and properties of Merger Sub and shall be subject to all the
debts and liabilities thereof in the same manner as if Akashic had itself
incurred them.
9. Upon the Merger becoming effective, the Articles of
Incorporation of the Surviving Corporation shall be amended in full to read as
set forth in Exhibit I attached hereto.
10. (a) Notwithstanding the approval of this Agreement of Merger by
the shareholders of Akashic and Merger Sub, this Agreement of Merger may be
terminated at any time prior to the Effective Time of the Merger by mutual
agreement of the Boards of Directors of StorMedia and Akashic, and the
shareholders of Akashic.
(b) Notwithstanding the approval of this Agreement of Merger by
the shareholders of Akashic and Merger Sub, this Agreement of Merger shall
terminate forthwith in the event that the Reorganization Agreement shall be
terminated.
(c) In the event of the termination of this Agreement of Merger
as provided above, this Agreement of Merger shall forthwith become void and
there shall be no liability on the part of Akashic, StorMedia or Merger Sub or
their respective officers or directors.
(d) This Agreement of Merger may be signed in one or more
counterparts, each of which shall be deemed an original and all of which shall
constitute one agreement.
(e) This Agreement of Merger may be amended by the parties
hereto any time before or after approval hereof by the shareholders of Akashic
and Merger Sub, but, after such approval, no amendments shall be made which by
law require the further approval of such shareholders without obtaining such
approval. This Agreement of Merger may not be amended except by an instrument in
writing signed on behalf of each of the parties hereto.
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IN WITNESS WHEREOF, the parties have executed this Merger Agreement as
of the date first written above.
STORMEDIA ACQUISITION CORPORATION
/s/ XXXXXXX X. XXXXX
-----------------------------------------
Xxxxxxx X. Xxxxx, President
/s/ XXXXXX X. X'XXXXX
-----------------------------------------
Xxxxxx X. X'Xxxxx, Secretary
AKASHIC MEMORIES CORPORATION
/s/ XXX XXXXXXX
-----------------------------------------
President
/s/ XXXX XXXXXX
-----------------------------------------
Secretary
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EXHIBIT I
RESTATED ARTICLES OF INCORPORATION
OF
AKASHIC MEMORIES CORPORATION
I
The name of this corporation is Akashic Memories Corporation.
II
The purpose of the corporation is to engage in any lawful act or
activity for which a corporation may be organized under the Corporation Code of
California other than the banking business, the trust company business or the
practice of a profession permitted to be incorporated by the California
Corporations Code.
III
This corporation is authorized to issue only one class of shares of
stock, designated as Common Stock; and the total number of shares which this
corporation is authorized to issue is 1000, $0.01 par value.
IV
1. Limitation of Liability. The liability of the directors of this
corporation for monetary damages shall be eliminated to the fullest extent
permissible under California law. This corporation is also authorized, to the
fullest extent permissible under California law, to indemnify its agents (as
defined in Section 317 of the California Corporations Code), whether by by-law,
agreement or otherwise, in excess of the indemnification expressly permitted by
Section 317 and to advance defense expenses to its agents in connection with
such matters as they are incurred. If, after the effective date of this Article,
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California law is amended in a manner which permits a corporation to limit the
monetary or other liability of its directors or to authorize indemnification of,
or advancement of such defense expenses to, its directors or other persons, in
any such case to a greater extent than is permitted on such effective date, the
references in this Article to "California law" shall to that extent be deemed to
refer to California law as so amended.
2. Repeal or Modification. Any repeal or modification of the
foregoing provisions of this Article IV shall not adversely affect any right of
indemnification or limitation of liability of an agent of this corporation
relating to acts or omissions occurring prior to such appeal or modification.
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OFFICERS' CERTIFICATE
OF
AKASHIC MEMORIES CORPORATION
Xxx Xxxxxxx, President, and Xxxx Xxxxxx, Secretary, of Akashic Memories
Corporation, a corporation duly organized and existing under the laws of the
State of California (the "CORPORATION"), do hereby certify:
1. They are the duly elected, acting and qualified President and
the Secretary, respectively, of the Corporation.
2. The authorized capital stock of the Corporation consists of
36,556,583 shares of Common Stock, $.001 par value, of which there are 23,335
shares outstanding and entitled to vote on the Agreement of Merger in the form
attached, and 31,756,583 shares of Preferred Stock, of which 19,200,000 shares
are designated Series A Preferred Stock, $.79828 par value, 19,200,000 of which
are outstanding and entitled to vote on the Agreement of Merger in the form
attached, and $.001 par value, 12,556,583 shares are designated Series B
Preferred Stock, none of which are outstanding and entitled to vote on the
Agreement of Merger in the form attached.
3. The Agreement of Merger in the form attached was duly approved
by the shareholders of the Corporation in accordance with the Corporation Code
of the State of California and has been approved by the Board of Directors.
4. The shareholder approval was by the holders of 86.8% of the
outstanding shares of Common Stock and 100% of the outstanding shares of
Preferred Stock of the Corporation. The required vote was a majority of the
outstanding shares of Common Stock of the Corporation and a majority of the
outstanding shares of Preferred Stock of the Corporation, voting as a separate
class.
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Each of the undersigned declares under penalty of perjury that the
statements contained in the foregoing certificate are true of their own
knowledge. Executed in San Jose, California, on December 31, 1997.
/s/ XXX XXXXXXX
--------------------------------------------
President
/s/ XXXX XXXXXX
--------------------------------------------
Secretary
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OFFICERS' CERTIFICATE
OF
STORMEDIA ACQUISITION CORPORATION
Xxxxxxx X. Xxxxx, President, and, Xxxxxx X. X'Xxxxx, Secretary, of
StorMedia Acquisition Corporation, a corporation duly organized and existing
under the laws of the State of Delaware (the "CORPORATION"), do hereby certify
that:
1. They are the duly elected, acting and qualified President and
the Secretary, respectively, of the Corporation.
2. There is only one authorized class of shares of the Corporation,
consisting of 1,000 shares of Common Stock, $.001 par value, and the total
number of issued and outstanding shares is 1,000.
3. The Agreement of Merger in the form attached was approved by the
board of directors and the shareholder of the Corporation in accordance with the
Corporation Code of the State of California.
4. The shareholder approval was by the holder of 100% of the
outstanding shares of the Corporation. The required vote was a majority of the
outstanding shares of Common Stock, $.001 par value, of the Corporation.
5. No vote of the stockholders of StorMedia Foreign Sales
Corporation ("StorMedia") (the sole shareholder of the Corporation and the
parent of the Corporation) was required by the Corporation Code of the State of
Delaware or the U.S. Virgin Islands or by the Certificate of Incorporation or
Bylaws of StorMedia or the Corporation.
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The undersigned declare under penalty of perjury that the statements
contained in the foregoing certificate are true of their own knowledge. Executed
in Santa Clara, California, on December 31, 1997.
/s/ XXXXXXX X. XXXXX
--------------------------------------------
Xxxxxxx X. Xxxxx, President
/s/ XXXXXX X. X'XXXXX
--------------------------------------------
Xxxxxx X. X'Xxxxx, Secretary
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