EXHIBIT 2.3
SIDE AGREEMENT TO MERGER AGREEMENT
DATED MARCH 8, 1999
ImaginOn, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 0
Xxx Xxxxxx, XX 00000
March 8, 1999
Will Xxxxxx
Network Specialists, Inc.
0000 Xxxx Xxxx Xxxxx, Xxxxx 00
Xxxxxx Xxxxxxx, XX 00000
Re: SIDE AGREEMENT TO THE MERGER AGREEMENT
Dear Xx. Xxxxxx:
This letter sets forth the side agreement (the "Side Letter") between
ImaginOn, Inc., a Delaware corporation ("Parent"), Network Specialists, Inc., a
Nevada corporation ("Target"), and iNOW, a California corporation.
As you know, the parties signed that certain Merger Agreement and Plan
of Reorganization Agreement dated as of February 9, 1999, as amended March 8,
1999 (the "Merger Agreement"). (Unless otherwise defined herein, capitalized
terms used in this Side Letter have the meaning ascribed to them in the Merger
Agreement.) The Merger Agreement requires Parent to pay $230,000 in cash at the
Closing to the shareholders of Target, the target of the Merger. After the
execution of the Merger Agreement, certain liabilities of Target were discovered
which amount to $25,000, including liabilities to American Express Card Services
and Xxxxxxx Xxxxx, Xx. In order to provide for the payment of the liabilities,
the parties hereby agree to the following changes at the Closing:
1. Instead of paying $230,000 at the Closing as required by Section 3.1
of the Merger Agreement, Parent shall pay $205,000 in immediately negotiable
checks to the shareholders of Target at the Closing as follows: $102,500 made
payable to Xxxxxxx Xxxxxx and $102,500 made payable to Xxxxxxx Xxxxx;
2. At the Closing, Parent shall deliver to Target a check in the amount
of $25,000;
3. At the Closing, Target shall deliver a check made payable to Xxxxxxx
Xxxxx, Xx. in the amount of $8,750;
Xxxxxxx Xxxxxx
Network Specialists, Inc.
March 8, 1999
Page 2
4. At the Closing, Target shall deliver a check made payable to
American Express Card Service in the amount of $7,500; and
5. Target hereby covenants to retain in an account $8,750 of the
$25,000 check described in Paragraph No. 2 above in order to pay any additional
liabilities which are discovered after the Closing. After satisfaction of any
outstanding liabilities, the remainder of the $8,750 shall be distributed by
Target in equal amounts to Xxxxxxx Xxxxxx and Xxxxxxx Xxxxx after September 30,
1999.
Except as modified above, the Merger Agreement shall remain in full
force and effect. The parties hereby acknowledge and agree that this Side Letter
is deemed to be a part of and a supplement to the Merger Agreement,
notwithstanding Section 13.4 of the Merger Agreement.
This Side Letter may be executed in counterparts and all counterparts
so executed shall constitute one Side Letter binding on all the parties hereto.
It shall not be necessary for each party to execute the same counterpart.
If this Side Letter accurately describes our agreement, please sign the
Side Letter (and the enclosed counterparts) where indicated and return the
original to me. Please keep a counterpart for your files.
Thank you for your cooperation.
Very truly yours,
ImaginOn, Inc.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------
Xxxxx X. Xxxxxxxx, President
Accepted and Agreed to this 8th day of
March, 1999:
Network Specialists, Inc.
By: /s/ Xxxxxxx Xxxxxx
------------------------------
Xxxxxxx Xxxxxx, President
iNOW
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Xxxxx X. Xxxxxxxx, President
